Big Business This Week is a guided tour through the biggest market stories of the week, from winning stocks to brutal dips to the facts and forecasts generating buzz on Wall Street.
The electric vehicle manufacturer spooked investors this week by issuing a $1.5 billion bond to raise money – after raising $1.3 billion earlier this year. However, the company insists cash is not an issue; it is trying to get ahead of borrowing that could get costlier in the future. Rivian announced this week that it is on track to begin construction on a Georgia factory, which comes in addition to work that is expected to begin on sites in Colorado, Texas and California in the next few months. Rivian stock dropped almost 13 percent this week.
Costco CEO W. Craig Jelinek is stepping down, but his replacement is already well-versed on the warehouse store. President Ron Vachris, a 40-year veteran of Costco, will take over in January. Jelinek will stay on until April to help with the transition. No word on the fate of the $1.50 hot dog and soda combo deal that Jelinek has held onto for decades. The stock dropped slightly on the news of his departure, down almost 3 percent for the week.
Wireless network giant Nokia is about to cut 14,000 jobs globally in the face of a weak market and falling profits. The company aims to cut its costs nearly in half by the end of 2026. It hopes the development of cloud computing and artificial intelligence becomes a boon to its own business, as tech companies will continue to need the networks it provides. The stock was down nearly 11 percent this week.
Wyndham Hotels & Resorts could be up for sale, but not for the $8 billion offered by Choice Hotels, the parent company of brands like Radisson, Quality Inn and Park Plaza. Apparently, the companies had been negotiating a potential deal out of the public eye for months, but when talks broke down Choice announced its bid. Wyndham's board unanimously turned it down and said it was "underwhelming, highly conditional and subject to significant business, regulatory and execution risk." Choice Hotels CEO indicated more negotiations may be possible. Wyndham stockholders were pleased with the decision, sending the stock up 8 percent this week, while Choice Hotels investors pulled back with the stock dropping 9 percent.
RITE AID BANKRUPTCY
The week started with bad news from pharmacy chain Rite Aid. It filed for Chapter 11 bankruptcy protection as it tries to work its way out of a mess of hundreds of millions of dollars of fiscal losses and opioid lawsuit settlements. It says it has already secured $3.45 billion in financing to get through restructuring, but it'll close more than 150 stores in the process - about 7 percent of its total footprint. Rite Aid stock closed the week up a whopping 47 percent, although that only brought the stock price up to 26 cents per share.