Wells Fargo, J.C. Penney, Amazon.com: Stocks That Defined the Week

By Francesca Fontana 

Wells Fargo & Co.

U.S. lenders are preparing for a flood of loans to go bad, a sign of how deep the economic downturn will be. Profits at Wells Fargo and its peers sank after the banks set aside billions for loan losses expected from millions of Americans now out of work. These banks rode consumer spending and borrowing to big profits for years. Now, they are preparing to struggle alongside their customers. Wells Fargo shares fell 4% Tuesday.

Roku Inc.

With Americans sequestered at home, millions more are relying on Roku to stream their favorite movies and TV shows. The maker of digital media players said late Monday that it has added nearly three million accounts in the first three months of the year. Streaming hours for the period were up 49% from the year before. Roku, which takes a fee when users subscribe to paid apps on its devices, said it started to log the effects of large numbers of homebound consumers people late in the quarter. The company also withdrew its financial guidance for the year, citing uncertainties about the ultimate business impact from the pandemic. Roku shares gained 10% Tuesday.

J.C. Penney Co.

The bankruptcy clock is ticking for J.C. Penney. The department-store chain skipped a $12 million interest payment owed to bondholders, J.C. Penney said Wednesday in a securities filing, kicking off a 30-day grace period before a debt default becomes official. Struggling amid coronavirus-related closures and furloughs, the company has been in negotiations with lenders to restructure its obligations or secure financing for a potential bankruptcy filing. Other struggling retail chains, including Neiman Marcus Group Inc. and J.Crew Group Inc., also have been in negotiations with creditors this month. J.C. Penney shares plummeted 27% Wednesday.

Verizon Communications Inc.

Now that online videoconferencing has achieved mass popularity, Verizon wants to dial in. The carrier will pay less than $500 million for Blue Jeans Network Inc., a videoconferencing company that has surged in use while more people work remotely during the coronavirus pandemic. BlueJeans, the company's brand name, is aimed at business users and isn't available free to consumers, unlike Zoom Video Communications Inc. and Microsoft Corp.'s Skype. BlueJeans offers encrypted videoconferencing, where Zoom has faced public backlash over its security practices. Its CEO Eric Yuan vowed earlier this month to create end-to-end encryption after the platform's surging popularity attracted trolls and hackers. Verizon shares rose 1.3% Thursday.

UnitedHealth Group Inc.

The coronavirus pandemic is rippling through all corners of the health-care system. The impact was evident in numbers released Wednesday by the biggest U.S. insurer. UnitedHealth said its insurance arm gained from widespread cancellations of medical procedures in the recent quarter but its surgery centers were hurt by falling volumes as the deadly virus spread across the U.S. Across the nation, surgeries have been canceled as hospitals and other health-care providers make room for the surge of coronavirus patients. Americans also are avoiding clinics and emergency rooms amid infection fears and stay-at-home orders. Meanwhile, in places such as New York, hospitals are overwhelmed by patients sick with Covid-19, the illness caused by the novel virus. UnitedHealth shares gained 4.1% Wednesday.

Amazon.com Inc.

Amazon.com now has an unusual goal: sell less. The online retailer, struggling to meet a huge surge in order volumes during the coronavirus pandemic, is retooling its website to get shoppers to buy fewer items, The Wall Street Journal reported Thursday. Last month, Amazon began removing fixtures of its site designed to get customers to make additional purchases, like most of its popular recommendation widgets that show what other shoppers with similar items in their basket also bought. The company also decided to cancel its Mother's Day and Father's Day promotions, and its annual Prime Day shopping event has been pushed back indefinitely. Amazon shares added 4.4% Thursday.

Procter & Gamble Co.

Shoppers rushing to stock up on medicine and cleaning supplies boosted P&G to its biggest U.S. sales increase in decades. The consumer-products giant said Friday that the demand for household goods more than offset steep declines in China where closures stymied production and buying. The strongest growth was in P&G's health-care unit, which includes Vicks cold medicine, and its fabric and home care division. Essentials such as laundry detergent and toilet paper drove much of the increase; P&G executives say they believe increased consumption of its products will persist after the pandemic passes. P&G shares gained 2.6% Friday.

Write to Francesca Fontana at [e-mail]

(END) Dow Jones Newswires

April 17, 2020 18:33 ET (22:33 GMT)

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