WeWork (WE) shares tumbled further today after issuing a reverse stock split to maintain its listing on the New York Stock Exchange. Mastercard (MA) denies reports from the Wall Street Journal it is raising credit card fees for retailers.
Yahoo Finance Live takes a look at several trending stocks and top headlines after Tuesday's closing bell.
Video Transcript
ALEXANDRA CANAL: Similar to the box office being under pressure, WeWork shares are under pressure today. The company's 40 to 1 reverse stock split going into effect today. You're seeing shares closing down a whopping 19%. And Seana, this is just a company that has had a disastrous run as a publicly traded company.
If you recall, at one point, this company was valued at $47 billion. Today it's below $3 billion trading as a penny stock at this point. They have said they are looking at different types of ways to turn the business around-- negotiating more favorable lease terms, generating new sales, seeking additional capital efforts. But it's hard to know where this company goes from here.
SEANA SMITH: It is very hard to know where this company goes from here. When we talked about why they made this move, they did it so they could still stay listed on the New York Stock Exchange. When you take a look at some of the rules, some of the guidelines from the NYSE, you have to have a closing price above $1, so they did this as one of their last ditch efforts here. They're trying to turn around the business.
But we know WeWork is not alone when you take into account the pressure that we are seeing in the office space right now. So many companies-- obviously WeWork having an outsized impact because of this, but so many companies are trying to figure out what they're going to do with their office spaces. WeWork dealing with elevated costs, a cash burn, that high turnover rate.
People simply are not renewing their memberships here with WeWork, so the company has a very, very, very challenging several months ahead of themselves. They talked about that turnaround strategy that you mentioned, saying that it's critical that they execute on that in order to stay in business. So we'll see what happens here for the future of WeWork.
Let's also take a look at Mastercard. Now, Mastercard denying reports that it's planning to raise credit card fees on merchants. Bloomberg and the Wall Street Journal previously saying last week that the company was going to start charging retailers more starting next month. We're looking at Mastercard closing off just about 1%.
Now, we talk about the massive run up in fees and what some of these credit card companies-- Mastercard included-- charge these vendors, charge these third parties in order to use a credit cards. Clearly that fee level has been climbing very, very steadily over the last several years. And it means something to consumers too because, a lot of time, merchants are being forced to pass along some of those higher costs to consumers in the form of how they're pricing their products in order to offset some of the pressure from fees. But Mastercard coming out saying that, at least for right now, they don't have plans to raise their fees.
ALEXANDRA CANAL: And that was my question mark. Is it going to happen later and it's just not going to happen now? But as we were [? mentioning, ?] I mean, these fees are so high. Merchants in the US paid an estimated $93 billion in both Mastercard fees along with Visa fees as well. And Visa also said that recent press coverage on the issue was, quote, misleading and that its fees on visa transactions have been flat for the past decade. So good news for merchants and the consumer, as you were mentioning, especially considering this macro environment is so uncertain right now.
