Investors haven't been quite sure what to do about the stock market during the month of February, as major market benchmarks haven't been able to sustain their upward momentum from the beginning of the year. Yet Wall Street seemed to be in a good mood coming out of the weekend, and stock index futures suggested that the Nasdaq Composite (^IXIC 2.02%) could climb about half a percent when the regular trading session starts Monday morning.
Helping to boost the Nasdaq, Li Auto (LI 6.69%) posted a nice advance as investors reacted to the latest news from the Chinese electric vehicle manufacturer. Yet another company listed on the Nasdaq enjoyed an even bigger gain, as Seagen (SGEN) could be in line to get an acquisition bid if reports prove correct.
Li moves into the fast lane
Shares of Li Auto had a nice gain early Monday, rising 6% in premarket trading. The EV maker posted its fourth-quarter financial results, and investors reacted positively to what they saw as continued success for the company even in a competitive environment within China.
Li reported a nice bump higher in deliveries during the fourth quarter, putting 46,319 of its vehicles in the hands of customers. That was up 32% year over year, and it capped a year in which Li delivered 133,246 vehicles, up from just under 90,500 in 2021. Revenue of $2.5 billion was up 66% from year-ago levels, and although margin levels fell slightly, adjusted net income of $140 million was up 41% versus the fourth quarter of 2021.
Investors were also pleased with recent product releases from Li. The automaker officially launched its L7 five-seat SUV in early February, offering an attractive mix of long range, driver assistance systems, and premium audio-visual equipment. The new vehicle supplements Li's lineup of larger SUVs, and founder/CEO Xiang Li sees it as a key part of its broader strategy to embrace the needs of families.
Li has attracted positive attention from competitors in the EV industry, and it has been growing at a breakneck pace lately even as some of its rivals have slowed. Even if demand becomes sluggish for a period of time within China, the long-term trends favoring the industry remain in place, and that should give Li a chance to shine in the years ahead.
Seagen could get buyout interest
Seagen shares got an even bigger boost on Monday morning, jumping 13% in premarket trading. The move came after reports that a giant in the pharmaceutical industry could be looking to purchase the biotech stock and its stable of treatments for cancer.
Pfizer has begun discussions with Seagen in pursuit of a possible buyout, according to a report from The Wall Street Journal. The report suggests that a deal could have a price tag well in excess of $30 billion, offering new hope after previously reported talks with Pfizer rival Merck failed to result in a definitive acquisition agreement.
The benefits for Pfizer are clear. Like most drugmakers, Pfizer faces the continual need to replace blockbuster drugs that are losing patent exclusivity with new treatments. Despite having made a number of smaller acquisitions in recent years, Pfizer could find Seagen and its antibody-drug conjugate treatments for various forms of cancer extremely attractive in promoting future sales.
Seagen jumped earlier in February after reporting strong fourth-quarter financial results that were better than most investors had anticipated.
