Raphael Stevens

Greenlight Capital’s David Einhorn told investors that Peloton’s stock is significantly undervalued.
The hedge fund boss made the pitch while riding a Peloton, a source familiar with the comments told CNBC.
Peloton, known for its Bike and Tread machines, is in the middle of a turnaround and currently looking for a new CEO.

David Einhorn speaking at the 2024 Sohn Conference in New York City on April 3, 2024.
Adam Jeffery | CNBC

Shares of Peloton spiked more than 11% on Wednesday after Greenlight Capital’s David Einhorn said shares of the company are significantly undervalued, CNBC has learned. 
Einhorn made the pitch at the Robin Hood Investors Conference. It was not immediately clear what Einhorn believed Peloton shares should trade at.

He made the case for the company as he was riding a Peloton bike, a person familiar with his remarks said. 
Over the summer, Greenlight Capital, the hedge fund that Einhorn founded in 1996, disclosed it had a $6.8 million stake in the company as of June 30. 
Peloton’s stock tends to be volatile and is up a little more than 1% so far this year, as of Tuesday’s close. 
Einhorn’s comments come one day after the company announced it was partnering with Costco to sell its Bike+ in the retailer’s stores and online as it looks to reach younger, wealthier consumers with the discretionary income to buy pricey exercise equipment. 
The company is currently being led by two board members after CEO Barry McCarthy stepped down earlier this year. It is in the process of finding a new CEO and expects to announce its next top executive this year.

When reporting earnings in August, Peloton indicated it was ready to focus more on profitability over growth after completing a massive refinancing that pushed out its debt maturities and bought it some time to affect a turnaround. 
Peloton did not immediately respond to CNBC’s request for comment. 

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Abercrombie & Fitch said federal prosecutors have its full cooperation as they continue to investigate the brand’s former CEO Mike Jeffries for sex trafficking and prostitution.
“We are appalled and disgusted by the alleged behavior of Mr. Jeffries,” a company spokesperson told CNBC in a statement.
Jeffries was arrested on charges of sex trafficking and interstate prostitution for allegedly coercing aspiring Abercrombie models into sex acts in exchange for modeling gigs, among other acts.

Former Abercrombie & Fitch Chairman and CEO Mike Jeffries addresses stockholders during the company’s annual meeting at its headquarters in New Albany, Ohio, on May 22, 2003.
Will Shilling | Via Reuters

Abercrombie & Fitch washed its hands of its former CEO Mike Jeffries after he was arrested on federal sex trafficking charges, saying in a Wednesday statement the company is “committed to fully cooperating with law enforcement as the legal process continues.” 
“As we shared when the accusations were first made public in October 2023, we are appalled and disgusted by the alleged behavior of Mr. Jeffries, whose employment with Abercrombie & Fitch Co. ended nearly ten years ago,” a company spokesperson said in a statement to CNBC. 

“For close to a decade, we have successfully transformed our brands and culture into the values-driven organization we are today,” the spokesperson added. “We have zero tolerance for abuse, harassment or discrimination of any kind.” 
Shares of Abercrombie were down about 5% on Wednesday.
On Tuesday, Jeffries — who helmed the legacy apparel brand from 1992 to 2014 — along with his partner Matthew Smith and another associate, were arrested on charges of sex trafficking and interstate prostitution that prosecutors allege happened during his tenure at Abercrombie. 
Jeffries and Smith are accused of coercing aspiring Abercrombie models into sex acts in exchange for modeling gigs, among other acts.
“Many of the victims, at least one of whom was as young as 19 years old, were financially vulnerable and aspired to become models in the fashion industry, a notoriously cut-throat world,” prosecutors wrote in a court filing.

“Indeed, some of the men they recruited had previously worked at Abercrombie stores or modeled for Abercrombie.”
Under Jeffries’ tenure, Abercrombie became known for its sexually charged marketing and its efforts to market exclusively to kids perceived as good-looking and cool. But the abuse he allegedly perpetrated did not become widely known until the BBC published an explosive investigation into his practices last year. 
Soon after the investigation was published, Jeffries and Abercrombie were sued by a man who said he was victimized by the former CEO in the 2010s when he was recruited for a modeling opportunity.
Nearly a year later, federal prosecutors brought a case against Jeffries. His attorney, Brian Bieber, told NBC News on Tuesday it would respond to the allegations in more detail at a later date.
“We will respond in detail to the allegations after the Indictment is unsealed, and when appropriate, but plan to do so in the courthouse — not the media,” Bieber said.
The longtime retailer was ousted from Abercrombie in 2014 following a long sales decline. Under the direction of its new CEO Fran Horowitz, Abercrombie is now one of the best-performing apparel companies in the industry. It has introduced inclusive sizing and jeans that are designed for curvier bodies, and has made it clear in its marketing that it is no longer after a single customer from one type of racial background. 
In its statement, Abercrombie said it supports the victims who have come forward. 
“Speaking up and coming forward is not easy,” the spokesperson said. “Our thoughts remain with those who have bravely raised their voices as part of the federal investigation.”

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Coca-Cola CEO James Quincey said an E. coli outbreak linked to its biggest restaurant customer, McDonald’s, isn’t likely to hurt the beverage company’s sales at this stage.
The CDC said its investigation has linked the outbreak to the fast-food chain’s Quarter Pounder burger.
The burger will be temporarily unavailable in some McDonald’s locations, and the company said it’s also taken steps to remove onions that might also be contaminated.

Coca-Cola President and CEO James Quincey attends a press conference with International Olympic Committee (IOC) president and China Mengniu Dairy CEO and Executive Director, as part of the 134th Session of the International Olympic Committee (IOC) at the SwissTech Convention Centre in Lausanne, on June 24, 2019.
Fabrice Coffrini | AFP | Getty Images

Coca-Cola CEO James Quincey said the company doesn’t expect an E. coli outbreak linked to McDonald’s to hurt the beverage company’s sales.
“When one looks at what’s in the media so far, in terms of the states that have been affected, I would say at this stage it’s not going to be a large, significant impact to the business,” Quincey said on Coke’s third-quarter earnings call Wednesday.

McDonald’s is Coke’s largest restaurant customer, and the two companies’ symbiotic relationship has existed for nearly seven decades. Most recently, CNBC reported that Coke contributed marketing funds to McDonald’s this summer for its $5 value meal, which includes a small soft drink, to make it more attractive to franchisees who can otherwise be wary of steep discounts.
“We’re a big partner of McDonald’s, they’re a big partner of ours,” Quincey said. “We’ll be helping them in any way we can as they work through whatever’s happening here.”
On Tuesday, the Centers for Disease Control and Prevention announced that it has linked an E. coli outbreak in 10 states to McDonald’s Quarter Pounder burgers. The agency said 49 cases have been reported, with one fatality.
CDC investigators have narrowed in on two ingredients as the potential cause: the burger’s onions and its fresh beef patties. Both ingredients are unique to the Quarter Pounder burgers, although cooking the patty at the correct internal temperature should kill the bacteria.
McDonald’s said in a statement on Tuesday that Quarter Pounders will be temporarily unavailable in several Western states, including Colorado, Kansas, Utah and Wyoming, and portions of other states. The company also said it’s instructed all local restaurants to remove slivered onions from their supply and has paused the distribution of that ingredient in the affected area.

“We are very confident that you can go to McDonald’s and enjoy our classics. We took swift action yesterday to remove the Quarter Pounder from our menu,” McDonald’s USA President Joe Erlinger said on NBC’s “TODAY” show on Wednesday morning.
At this point, it’s unclear what impact the outbreak will have on McDonald’s own sales.
The outbreak comes as consumers broadly have been spending less at restaurants, hurting both McDonald’s and Coke. McDonald’s and its fast-food rivals have been leaning into discounts in the hopes that deals will bring back customers, while Coke has been chipping in to market the combo meals to boost its own sales.
Despite sluggish consumer spending, Coke’s third-quarter earnings and revenue topped Wall Street’s estimates, thanks to higher prices. Shares of the company fell more than 2% in morning trading.

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McDonald’s said the CDC told the company late last week about a potential link between its Quarter Pounder burgers and an E. coli outbreak.
Company spokespeople said McDonald’s decided to pull the menu item from restaurants in the affected area before the CDC issued its advisory notice.
Roughly a fifth of McDonald’s U.S. restaurants are not selling Quarter Pounder burgers at this time.

A customer walks out of a McDonald’s restaurant in Omaha, Nebraska, on Oct. 23, 2024.
Mario Tama | Getty Images

The Centers for Disease Control and Prevention told McDonald’s late last week about a potential link to an E. coli outbreak, company spokespeople said Wednesday.
At that time, the number of connected cases was smaller than it is now, though the company did not say how many cases there were then. As of Tuesday, the CDC has attributed 49 cases and one fatality across 10 states to the outbreak, which has been linked to McDonald’s Quarter Pounder burgers.

Once notified about the link, McDonald’s started working with the CDC, the U.S. Department of Agriculture and the U.S. Food and Drug Administration. By the time the CDC had issued its advisory notice Tuesday afternoon, McDonald’s had already decided to pull the Quarter Pounder burgers from restaurants in the affected areas, the spokespeople said.
Roughly a fifth of McDonald’s U.S. restaurants are not selling Quarter Pounder burgers at this time.
The CDC has interviewed 18 people with confirmed cases, as of Tuesday. Of those patients, 12 recalled eating a Quarter Pounder burger before falling ill.
The outbreak comes as McDonald’s tries to win back diners who balked at years of price increases. It adds to the risks facing the company at a time when it hopes a $5 value meal deal will drive consumers back to its restaurants.
The fast-food chain issued a statement on the outbreak Tuesday evening, shortly after the CDC issued its advisory. Cesar Pina, the company’s North American chief supply chain officer, said in the statement that the company is removing the Quarter Pounder from restaurants in the affected area, which includes Colorado, Kansas, Utah, Wyoming and parts of eight other states.

The CDC is investigating both the Quarter Pounder’s uncooked onions and its beef patty as the potential culprit for the outbreak. However, McDonald’s uses multiple beef suppliers in the region, and its burgers are supposed to be cooked to an internal temperature that would kill the bacteria.
That would leave the onions as the more likely contaminant. In that geography, McDonald’s uses a single onion supplier, which washes and slices the vegetable. The company has paused its distribution of the ingredient and asked local restaurants to remove their onion supply.
Based on reported cases so far, the outbreak took place between Sept. 27 and Oct. 11. Over a two-week period, McDonald’s typically sells roughly one million Quarter Pounders in the affected region, the company spokespeople said.
Shares of McDonald’s are trading down 5% in afternoon trading, as investors worry that the outbreak could lead to a sales slump for the fast-food giant.

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Novo Nordisk asked the Food and Drug Administration to prevent compounding pharmacies from making cheaper versions of its popular weight loss injection Wegovy and diabetes treatment Ozempic.
The Danish drugmaker contends the medications are too complex for those manufacturers to make safely. 
The FDA still has to make a final decision on whether to bar those unapproved versions of semaglutide, the active ingredient in Ozempic and Wegovy.

Boxes of Ozempic and Wegovy made by Novo Nordisk are seen at a pharmacy.
Hollie Adams | Reuters

Novo Nordisk on Tuesday asked the Food and Drug Administration to prevent compounding pharmacies from making unapproved and often cheaper versions of its popular weight loss injection Wegovy and diabetes treatment Ozempic, arguing that the medications are too complex for those manufacturers to make safely. 
The FDA still has to make a final decision on whether to bar compounded versions of semaglutide, the active ingredient in Ozempic and Wegovy. In a statement, the agency said it is reviewing the petition and will respond directly to Novo Nordisk.

The move is Novo Nordisk’s latest attempt to crack down on potentially harmful copies of semaglutide after it filed 50 lawsuits against several clinics, compounding pharmacies and other manufacturers over the last year. It comes as the Danish drugmaker tries to ramp up the supply of semaglutide to meet unprecedented demand in the U.S.
Patients have turned to compounded versions of semaglutide amid intermittent U.S. shortages of the branded drugs, which carry hefty price tags of $1,000 per month before insurance and other rebates. Many health plans don’t cover semaglutide for weight loss, making compounded versions a more affordable alternative.
Compounded medications are custom-made alternatives to branded drugs designed to meet a specific patient’s needs. When a brand-name medication is in shortage, compounding pharmacies can prepare copies of the drug if they meet FDA requirements. 
The active ingredient in Wegovy and Ozempic, semaglutide, has been in intermittent shortages over the past two years. The lowest dose of Wegovy is currently in short supply, but all other doses of the drug and Ozempic are listed as available, according to the FDA’s drug shortage database. 
But Novo Nordisk late Tuesday nominated semaglutide to the FDA’s “Demonstrable Difficulties for Compounding” lists, which include complex drugs that compounders are not allowed to make, even during shortages, because they could potentially pose safety risks. 

“Semaglutide products fit this description due to their inherent complexity and the potential dangers associated with attempting to compound them,” Novo Nordisk said in a statement. 
The Danish drugmaker cited several risks with compounded versions of semaglutide, including unknown impurities, incorrect dosage strengths and instances where a compounded product contained no semaglutide at all. 
“These drugs are inherently complex to compound safely, and the risks they pose to patient safety far outweigh any benefits,” Novo Nordisk said in a statement. The company said its “aim with this nomination is to ensure that patients receive only FDA-approved, safe, and effective semaglutide products.”
The FDA has previously warned about the risks of using compounded versions of so-called GLP-1s such as semaglutide. That refers to a buzzy class of medications that mimic hormones produced in the gut to tamp down a person’s appetite and regulate their blood sugar. 
Earlier this month, the FDA said compounded versions of semaglutide and similar drugs can be risky for patients because they are unapproved, meaning the agency does not review their safety, effectiveness and quality before they are put out in the market. 
The FDA in August also said it had received reports of patients overdosing on compounded semaglutide due to errors such as patients self-administering incorrect amounts of a treatment. 
Both Wegovy and Ozempic are under patent protection in the U.S. and abroad, and Novo Nordisk and its rival Eli Lilly do not supply the active ingredients in their drugs to outside groups. The companies say that raises questions about what some manufacturers are selling and marketing to consumers.
Tirzepatide is the active ingredient in Eli Lilly’s weight loss injection Zepbound and diabetes treatment Mounjaro. 
Like Novo Nordisk, Eli Lilly has sued several weight loss clinics, medical spas and compounding pharmacies across the U.S. over the past year. 
Notably, the FDA took tirzepatide off its shortage list earlier in October after more than a year, even as some pharmacies say they are still struggling to stock up on the branded versions of that drug. A trade group representing some compounders sued the FDA, which led the agency to say it will reconsider its decision to remove tirzepatide from its shortage list.

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