TSMC reports record sales, Sundial acquiring Alcanna, JPM upgrades Oatly stock

Yahoo Finance's Brian Sozzi and Julie Hyman break down the morning top stock movers, including TSM & OTLY.

Video transcript

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JULIE HYMAN: This is "Yahoo Finance Live." We are just about, oh, 5 and 1/2 minutes until the open here this morning. And we are taking a look at futures in the wake of a jobs report that came in much lower than estimated in terms of non-farm payrolls, 194,000 jobs added last month, 500,000 is what was estimated, as the unemployment rate ticked down to 4.8%. All of that equaling a little bit of upside in stocks here this morning.

Let's take a look at some individual stocks as well. We had some news on the chip front, not from here in the United States, however, important implications perhaps for the chip industry writ large. And TSM, Taiwan Semiconductor, does trade here in the United States. The company's quarterly sales jumping to a record, so obviously it is benefiting from the chip shortage and still seeing a decent amount of demand.

So again here, the company says revenue in the third quarter is going to be the US equivalent of about $14.8 billion. And the company tends to see pre-holiday orders give it a boost in its third quarter. So that seems to be what's going on here.

At the same time, we also got numbers from Samsung, another big chip maker. That company's operating profit up more than 25% in its third quarter. Samsung, of course, not just chips, but also makes stuff that has those chips in it, including smartphones. But still, a couple of interesting reads on what is going on in the chip industry, Sozz.

BRIAN SOZZI: Yeah, you really get the sense, Julie, that this chip supply shortage is not getting much better. You know, I remember talking to Ford CEO Jim Farley about a week and a half ago. Now, he told me he does see improvement quarter over quarter in the availability of chips.

But I mean, this notion that things are going to dramatically improve just because the calendar changes in 2022 I think is just not proving to be correct, and this will continue to plague a lot of industries, perhaps increasingly the PC sector. We saw HP downgraded a couple of weeks ago because of concerns about getting chips into PCs and overall PC demand here. So this is a problem, really, it's going be sticking around for quite some time.

JULIE HYMAN: Yeah, I mean, I think on an incremental basis, it is getting better. And that's something we heard from the chip makers that it would start to alleviate into the end of this year and then continue to get better going into next year while at the same time demand remains robust. So we'll see if that is actually how it plays out.

Another stock I'm watching this morning is a perennial one on the meme stock list. It's one that tends to be on trending tickers lists. And I've got to be honest with you, for a while there when it came up, I would have to remind myself what it did. Now I remember. It's a cannabis company.

It's called Sundial Growers. And as I say, it tends to be on the list whether there's news or not. But there actually is news on this company today. It's making an acquisition. So Sundial Growers is buying Alcanna. Alcanna not a household name here in the US. It is a liquor and pot retailer in Canada. $276 million is the price on this thing.

And so looking for a new channel through which to sell Sundial product, I guess. You can see here, the stock still trades at less than $1, but it's up by 14% here this morning. So apparently Alcanna has 171 alcohol shops, most of them in Alberta. They're called Liquor Depot.

And then they have a cannabis retail chain as well that was a separate company. They spun off into a separate company called Nova Cannabis, but they still own a 63% stake in Nova Cannabis. So a little bit of a complicated corporate structure there, but bringing together-- another attempt to bring together alcohol and weed under one umbrella.

BRIAN SOZZI: Yeah, sure does seem to make sense, Julie, light one up, chug a 40. A merger makes sense to me, at least on paper. But it also brings up this thought to me, at what point does Constellation Brands-- they took that stake several years ago in Canopy Growth. And I don't think it has worked out to the extent Constellation would have liked. But when you see an acquisition like this, if you're a Constellation, do you just say, you know what, it's finally time to bring Canopy Growth inside of our doors, make them part of us and run the company accordingly?

JULIE HYMAN: Yeah, we'll see if that's exactly how it plays out. As we get to the opening bell this morning, we're still about a minute away, but just, again, wanted to reiterate what we're seeing in terms of the action. And I also, as we're looking at the jobs report this morning, I got to mention a tweet that's getting some attention, or actually sort of a tidbit from the report that's getting attention from a couple of different quarters, because I think it is important here.

A couple of folks talking about that the disappointing jobs report driven by women leaving the workforce, continuing to leave the workforce. And Sozz, this is interesting because kids are back in school. And there was this expectation that once kids were back in school more women would go back to work. But school day is not, you know-- it's not the full workday. So people still need to get childcare after school is done. And maybe that's part of what the disconnect is here.

BRIAN SOZZI: Yeah, a major problem--

JULIE HYMAN: Let's pause for the-- Yeah. Sorry. Go ahead, Sozz.

BRIAN SOZZI: Go ahead, Julie.

JULIE HYMAN: I was just going to say we got the opening bell. Tricon Residential, which we spoke to yesterday Gary Berman, the president and CEO, ringing the opening bell after we talked to him yesterday and after the company listed there on the NYSE. And of course, our opening bell coverage is brought to you by PIMCO. Brian Sozzi, so talk to me here. What do you think-- what are your thoughts on women leaving the workforce?

BRIAN SOZZI: This is a major problem. And I just talked to former PepsiCo chairman and CEO Indra Nooyi. And her whole entire book, really, is on this very issue and how to address the problem. I encourage everyone to Google search her name. You'll see my story out there.

And I encourage you to give it a read, because you're continuing to see women leave the workforce for a number of reasons here. There has been a lot of studies out there recently on this. And it is a major problem and a major problem that I really do-- that really, Julie, is holding back, I think, these jobs report.

JULIE HYMAN: Yeah, most definitely. So we'll continue to look at that and talk about that with our guests. But finally this morning on the movers front, one of your perennial favorites, Oatly, the company moving this morning on an analyst call, and moving in a pretty big way. And Oatly has had a tough run of it since it came public, right. The stock has been falling, sliding pretty steadily here. But I believe it's going in the opposite direction this morning. Oh, and how. It's up about 9%, Sozz. What's up?

BRIAN SOZZI: Investors are drinking up this research note, Julie, from my man Ken Goldman, JP Morgan, really one of the best names on the Street in terms of food and consumer staples coverage. He is noting this, and to your point, Oatly shares are down 49% from their June 11 peak. So it has been a tough go.

And now Goldman really lays out some of the concerns here. He doesn't hide them or bury them on page 97. One, there is concern among investors about inflation and how Oatly tackles that. Also noting that Oatly continues to be on sale a good bit.

I know our producer Val Caval's very excited about that, an avid Oatly consumer. Now she can go get it on sale at a good price and help her out there and help her budget out. And also, third quarter sales, when they report in a couple of weeks, might slightly miss estimates.

Now having said all that, this main call by Goldman really is on valuation. It says, really, Oatly shares are just too cheap to ignore at current levels, looking for a 43% upside in Oatly shares over the next 12 months, overweight rating. I do find this one interesting too. At the bottom of the report, Julie, Goldman mentions it might be good to get long Oatly, or what they call a pair trade, so get long Oatly and get more concerned on Beyond Meat. Expectations for Beyond Meat might be a little too high as sales growth has slowed down a little bit in recent months.

JULIE HYMAN: Very interesting. So plant-based milk over plant-based meat.

BRIAN SOZZI: And now plant-based food. Mm-hmm.

JULIE HYMAN: Ah, at least for the moment.