Saudi Aramco, Twitter, Uber, Okta, and Jobs Friday - 5 Things You Must Know

Saudi Aramco unveils record $1.7 trillion IPO; Twitter enlists $700 million worth of junk-bond 'followers'; Uber details some rough rides; Okta posts mixed results; and 180,000 new jobs are expected to have been added to the U.S. economy last month.
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Here are five things you must know for Friday, Dec. 6:

1. -- Stock Futures Point to Higher Open Ahead of November Jobs Report

U.S. stock futures were pointing moderately towards a positive open on  Friday ahead of November's U.S. jobs report, which economists are anticipating showed positive job creation last month.

Asian markets gained on Friday after a senior Chinese official said negotiations for a phase-one trade deal with the U.S. are progressing.

Gao Feng, China’s minister of commerce, said Thursday that negotiators are in “close communication,” indicating an initial deal ahead of the next round of expected tariffs is imminent. 

However, he also emphasized that China continues to press on a rollback of existing tariffs to be included as a part of any resolution.

Stocks closed modestly higher on Thursday as investors continued to play a proverbial tennis match in terms of reacting positively and negatively about a possible U.S.-China trade deal.

The Dow Jones Industrial Average, which had been wavering most of the day, finished up 28 points, or 0.10%, to 27,677. The S&P 500 rose 0.15% and the Nasdaq advanced 0.05%.

Meantime, state-owned oil giant Saudi Aramco priced its initial public offering Thursday at the high end of the targeted range,  giving it a total value of $1.7 trillion in the world’s biggest-ever IPO.

Saudi Arabian Oil Co., known as Aramco, said it would sell 3 billion shares, or a 1.5% stake of the company, at 32 Saudi riyals ($8.53), or at the top of the targeted range of 30 to 32 riyals for a total of $25.6 billion.

That exceeds Alibaba Group’s $25 billion IPO in 2014, currently the world record. Still, the share sale falls short of the initial $2 trillion valuation targeted by Saudi Crown Prince Mohammed bin Salman.

By contrast, Apple Inc., (AAPL) - Get Report, the largest U.S. company by valuation, currently carries a market cap of $1.2 trillion.

On the earnings front, Big Lots (BIG) - Get Report and Genesco (GCO) - Get Report will report on Friday.

2. – Uber Report Details Thousands of Sexual Assaults Over Two-Year Span

Ride-hailing people- and food-delivering service Uber Technologies (UBER) - Get Report on Thursday revealed that more than 3,000 sexual assaults were reported last year, including 229 rapes across the company’s 1.3 billion rides that took place in 2018. 

The report, which Uber touted as the first of its kind, provides a rare, detailed look into the traffic deaths, murders and reported sexual assaults that took place during billions of annual rides arranged in the U.S. 

The company noted that drivers and riders were both attacked, and that some assaults occurred between riders.

In 2017, the company counted 2,936 reported sexual assaults during 1 billion U.S. trips. Uber bases its numbers on reports from riders and drivers, meaning the actual numbers could be much higher.

“I suspect many people will be surprised at how rare these incidents are; others will understandably think they’re still too common,” Uber CEO Dara Khosrowshahi said in a tweet following the report's release.

“Some people will appreciate how much we’ve done on safety; others will say we have more work to do. They will all be right.”

Uber’s share price was down 0.64% at $28.01 in premarket trading on Friday.

3. – Twitter Gains $700 Million Worth of Junk Bond Followers

Digital soap box Twitter (TWTR) - Get Report racked up more than $700 million worth of junk-bond followers this week in a two-day bond sale that far exceeded the social media platform’s own expectations.

The parcel of unsecured eight-year bonds due in 2027 was increased on Thursday from an initial size of $600 million, at par with a 3.875% coupon.

It was Twitter's first-ever unsecured bond sale, and came in at a lower interest rate than initially expected, reflecting robust demand from investors drawn to the social-media company’s ample cash flow.

Indeed, strong investor interest allowed the company to increase the size of the issuance by $100 million while lowering the yield from initial guidance of 4.5%, according to the Wall Street Journal.

S&P Ratings gave the new bonds a BB+ rating, which places them just one notch below investment-grade status. In its rationale, the credit-ratings firm said Twitter had “ample financial flexibility” via its $5.8 billion cash balance and a modest debt burden.

J.P. Morgan led the deal alongside Goldman Sachs, Morgan Stanley, Bank of America Merrill Lynch and Wells Fargo.

Shares of Twitter were up 0.2% at $30.10 in premarket trading. The stock is down 27% on the quarter to date as of end of trading Thursday.

4. – Okta Posts Strong Revenue Growth, Smaller-Than-Expected Loss

Shares of Okta (OKTA) - Get Report fell in after-hours trading Thursday after the cloud firm posted strong revenue growth and a smaller-than-expected quarterly net loss, though a still-wider overall loss on a year-over-year basis..

For the third quarter, Okta reported 45% growth in revenue to $153 million and billings growth of 42% to $175.6 million. Its net loss of 7 cents per share beat analysts’ forecasts of 12 cents per share, but was higher than its loss of 4 cents per share for the same period last year.

“We’re demonstrating that we can generate cash, and a combination of high growth and moving towards profitability,” Todd McKinnon, Okta’s CEO, told TheStreet's Annie Gaus.

Okta counts the healthcare IT firm Athenahealth among its enterprise customers, and the companies said on Thursday that Athenahealth had implemented Okta’s Identity Cloud offering, which facilitates a secure point of access for an organization’s customers and employees, into its patient portal.

Earlier this fall, Okta rolled out a slate of new security and access management offerings with large organizations in mind. McKinnon told TheStreet that there’s a clear demand for products that simplify those two functions, and that early reception has been strong.

Shares of Okta were down 0.65% at $118.38 in premarket trading on Friday.

5. – Jobs Friday: Nonfarm Payrolls Expected to Show Robust Job Growth in November

The U.S. jobs market is expected to have remained in high gear in November, with employers adding jobs at a solid clip during the month, keeping the unemployment rate at its lowest level in a generation, the government is expected to report on Friday.

At 8:30 am, the Bureau of Labor Statistics will release the November jobs report, which is expected to show 180,000 new nonfarm jobs were added to the economy last month, up from 128,000 in October, based on a survey of economists by data provider FactSet. 

The unemployment rate is expected to have held steady at a generation low of 3.6%. The jobless rate has logged in at or below 4% for 20 straight months, the longest such stretch since the 1960s.

Specifically, a rebound in employment activity from General Motors (GM) - Get Report workers heading back to work after striking in October is expected to help drive November job growth after October's manufacturing-led lull. 

Employment growth has cooled this year as the U.S. economic growth has responded to a global slowdown. Employers added an average 167,000 payrolls each month in 2019, down from an average of 223,000 in 2018.