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Coronavirus jitters take toll in Tri-Counties

By and   /   Friday, March 13th, 2020  /   No Comments

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Editor’s note: The content below was published at 2 p.m. March 16.

National financial markets and tri-county stocks continued to plunge March 16 in defiance of new fiscal stimulus as states imposed new restrictions over the weekend on restaurants, movie theaters and other businesses.

President Donald Trump warned that the economic impact of the coronavirus epidemic could last through the summer. 

The S&P 500 fell 12 percent in the selloff, and the Dow Jones Industrial Average dove 13 percent. The Tri-Counties fared somewhat better, falling 10 percent overall, including a 6.6 percent decline for regional giant Amgen to $188.68 per share.

Atara Biotherapeutics plunged 26 percent, followed by declines of more than 25 percent for financial stocks PennyMac Financial and PennyMac Mortgage. 

Camarillo semiconductor company Semtech fell nearly 23 percent. Regional software firms also saw declines, including a 20 percent drop for Ventura adtech firm The Trade Desk, and a 16 percent fall for Goleta property management software developer AppFolio to a new 52-week low. 

Aerospace and instrumentation stock Teledyne also fell 13 percent, but drone maker AeroVironment rose slightly, ending the day up 1.2 percent to $51.01. 

A few small-cap stocks defied the market plunge, including Goleta electronics maker Resonant, which ended up 6.7 percent, and Camarillo-based Salem Media, which rose 2.8 percent. CDTi Advanced Materials, based in Oxnard, gained 3 cents, a 27 percent gain for the day.

Editor’s note: The content below was published at 11 a.m. March 16.

All three of the Tri-Counties now have confirmed cases of the coronavirus and the rapid spread of the disease prompted state and federal officials over the weekend to suggest banning gatherings of more than 50 people and closing bars, tap rooms and wineries.

In Ventura County, the first of the three counties to report an active case, four more people were presumed to be positive for coronavirus after initial testing came back positive March 13. Of those cases, one is in question, as an 8-year-old was later retested and found negative.

In Santa Barbara County, there is only one confirmed case so far: a resident in their 60s with no history of traveling in the past six weeks. Because of the lack of history, this case is also being considered the first cases of community transmission in the county.

In San Luis Obispo, two confirmed cases were announced over the weekend. San Luis Obispo County Health Officer Penny Borenstein said both cases are from community transmission.

Public health officials in both Santa Barbara and San Luis Obispo counties said they are reaching out to people who may have come in contact with the confirmed cases, including friends, family members and health care professionals.

Those people will be monitored and tested for coronavirus, if needed.

To slow the spread of coronavirus through the country, the Centers of Disease Control and Prevention has recommended people limit gathering in groups of 50 or more for the next eight weeks.

Gov. Gavin Newsom on March 15 asked all Californians over the age of 65 to isolate themselves from others, and said all residents with underlying health issues — such as problems like blood disorders, recent pregnancies and compromised immune systems — should do the same.

Newsom also called for the closure of all bars, wineries, nightclubs and brewpubs. He didn’t put the same restrictions on restaurants, but said they could only serve half as many of their regular occupants.

More closures, restrictions and guidance are expected to come as city, county and state officials learn more about the spread of the disease.

Tri-County stocks continued their slide March 16, dipping another 4.5 percent as of 10:30 a.m., with Westlake Village-based PennyMac Financial Services leading the fall, down 22 percent. 

Software firms The Trade Desk and AppFolio fell 17 percent and 15 percent respectively. Thousand Oaks drug development firm Arcutis Biotherapeutics fell 16.5 percent. 

PennyMac Mortgage Investment Trust was not far behind, with a 16.2 percent drop, and LTC properties declined 14 percent. 

Regional biotech giant Amgen fell 2.6 percent to $196.90, with declines for other regional biotech firms including Atara Biotherapeutics, MannKind and GT Biopharma. 

Among high-end consumer goods manufacturers, Santa Barbara speaker maker Sonos fell 14 percent to $7.26 and Goleta footwear and apparel company Deckers fell 11.4 percent to $114.88. 

Interlink Electronics continued to climb despite the market declines, gaining a penny to reach $4.26. Goleta-based Resonant had gained 8.7 percent, following earnings results that surpassed analyst estimates. 

Community West Bancshares gained 5 percent to $8.13. 

Tri-County stocks continued their slide March 16, dipping another 4.5 percent as of 10:30 a.m., with Westlake Village-based PennyMac Financial Services leading the fall, down 22 percent. 

Software firms The Trade Desk and AppFolio fell 17 percent and 15 percent respectively. Thousand Oaks drug development firm Arcutis Biotherapeutics fell 16.5 percent. 

PennyMac Mortgage Investment Trust was not far behind, with a 16.2 percent drop, and LTC properties declined 14 percent. 

Regional biotech giant Amgen fell 2.6 percent to $196.90, with declines for other regional biotech firms including Atara Biotherapeutics, MannKind and GT Biopharma. 

Among high-end consumer goods manufacturers, Santa Barbara speaker maker Sonos fell 14 percent to $7.26 and Goleta footwear and apparel company Deckers fell 11.4 percent to $114.88. 

Interlink Electronics continued to climb despite the market declines, gaining a penny to reach $4.26. Goleta-based Resonant had gained 8.7 percent, following earnings results that surpassed analyst estimates. 

Community West Bancshares gained 5 percent to $8.13. 

Editor’s note: The content below was published on March 13.

Coronavirus jitters were shaking up business across the Tri-Counties even before the World Health Organization declared COVID-19 a pandemic on March 11.

Coronavirus has been putting pressure on health systems for months, putting regional stocks into throes of a bear market, disrupting the flow of supplies, tourism and education and putting small businesses at the precipice of distress.

While the only case of COVID-19 in the Tri-Counties is a Ventura County resident already in quarantine, the United States has more than 1,200 confirmed cases, with more than 15 percent in California.

The Ventura County resident contracted the disease while traveling on the cruise ship Grand Princess, which had been scheduled to arrive in Santa Barbara on March 24 before that cruise was canceled.

There were no reported community-transmission cases of COVID-19 in any of the three counties at press time.

It isn’t expected to stay that way. Public health agencies in all three counties are approaching the disease with the expectation that coronavirus will spread through communities, and are creating and implementing plans to limit the spread.

HEALTH CARE

Of the state’s 32 public health labs, 18 are testing for coronavirus, including labs in San Luis Obispo and Ventura counties. The state has also allowed commercial labs to start testing for coronavirus, a move Ventura County Public Health Officer Robert Levin praised when he spoke to the Pacific Coast Business Times on March 9.

He said the move will make it easier for people to get tested. Ventura County had tested 55 people at press time. “If it’s there, we’re going to find it,” Levin said.

Not all counties are approaching coronavirus in the same way. In San Luis Obispo County, both Tenet Health and Dignity Health, the two major hospital chains, have agreed to forgo sending potential coronavirus cases to be tested at commercial labs.

Instead, they’re sending tests to the public health lab. Dr. James Beebe, laboratory director for the San Luis Obispo Public Health Department, said the results will come back faster.

“We can control the disease much better if the patient is in house,” Beebe said.

Coronavirus is still early in its progression, and Levin doesn’t have a time frame for what to expect from the disease and when. All three counties have recommended that residents practice social distancing as a way to interrupt the spread of the disease.

Social distancing is a practice of avoiding areas with concentrations of people and increasing the distance between people. Coronavirus is a respiratory illness spread through droplets, which means actions like coughing, sneezing and touching the face can spread the illness between people.

By interrupting how the disease spreads, public health officials are hoping to protect populations of people who are more vulnerable to the disease. These populations include those over 60 years old, as well as people who have compromised immune systems.

Social distancing applies to many areas, including entertainment, and the CDC issued recommendations for more vulnerable populations to avoid large crowds by stocking up on groceries and staying home.

Public health agencies in the county are also preparing for what’s seen as the eventuality of treating people who have coronavirus. Dr. Douglas Metz, the deputy director of the Santa Barbara County Public Health Department, said the agency is communicating with area hospitals on a daily basis.

The Santa Barbara County Public Health Department runs eight clinics, and it had a stash of sanitation supplies on hand. Metz expects to run through the stash.

“If (the crisis) lasts much longer, we’re going to rely on manufacturers to speed up their production,” Metz said. “We’re going to have issues with supplies, but no more than anyone else.”

Metz said the region is fortunate in a few ways. Because there isn’t a reported outbreak in the tri-county region at press time, counties have the opportunity to learn from other areas that are dealing with outbreaks.

Additionally, the county has recent experience dealing in public emergencies from multiple natural disasters in the past five years.

Metz recommended people keep calm and get the flu shot as a way to protect themselves — not from the coronavirus, which has no vaccine, but from the regular flu season, which is still going.

“There’s no reason to go to Costco and clear the shelf of toilet paper,” Metz said. “You’re more likely to get ill with the flu than with COVID-19, at least on the Central Coast.”

STOCK MARKET

Markets fell into bear territory at press time March 11 as the coronavirus was officially labeled a pandemic, ending more than a decade-long bull run for the Dow Jones Industrial Average. Stocks in the Tri-Counties gave back the gains they’d made in the prior day’s recovery and shed some $12.6 billion in value over three days.

Shares for Goleta breast implant manufacturer Sientra cratered to a new low of $2.44, down 33.9 percent during the period.

LTC Properties, the Westlake Village real estate firm that invests in senior housing, and technology firms Resonant, Atara Biotherapeutics, CDTi Advanced Materials and Interlink Electronics all had losses that topped 20 percent.

The region’s software firms also lost ground. Goleta-based AppFolio fell 16.4 percent, while Summerland firm QAD and Ventura-based digital advertising platform The Trade Desk lost more than 11 percent apiece.

Biotech giant Amgen accounted for around half of the lost market value, falling just 5.7 percent over the period, the fourth best performance among tri-county stocks.

Alone among tri-county stocks, the micro-cap Westlake Village drug developer GT Biopharma rose 44 percent, after it announced plans to manufacture and test its technology for seriously ill victims of coronavirus in partnership with a Chinese firm.

On March 11, the S&P 500 index had lost 17 percent since its prior Friday close, and the Nasdaq slid 9 percent. The Dow Jones was down 7.2 percent, 20 percent below the high it set Feb. 12, putting it in a bear market. The market selloff hit the smaller-cap Russell 2000 index hardest, driving it down 12.7 percent during the period.

LOGISTICS

U.S. ports reported shortages of shipping containers, particularly for refrigerated goods, but the Port of Hueneme said its ability to move cargo has not been impacted by the global outbreak. The port only does around 2.3 percent of its trade with China, and any ships going to or coming from China first stop at ports in other countries, it said in a status update.

It has instituted a continuity of operations plan and been in touch with county health officials, the U.S. Coast Guard, and U.S. Customs and Border Protection for crew risk identification and mitigation, the notice said. To date, there have been no reported cases of infected individuals arriving at any U.S. seaports, including the Port of Hueneme.

TOURISM

The State Department urged Americans to avoid both cruises and extended air travel on March 8.

Cruises docking in Santa Barbara typically provide a significant economic boost for businesses on State Street but Santa Barbara Mayor Cathy Murillo asked all cruise companies to avoid disembarking in Santa Barbara through the rest of the cruise season.

There were 11 cruises left of the 28 scheduled to come through Santa Barbara this season, including the Grand Princess, which was scheduled to return to the city on March 24. Cruise ship passengers usually spend an estimated $3 million to $4 million at restaurants and retail locations in Santa Barbara each year.

While the loss of cruise and international travelers will be significant, local tourism organizations like Visit Ventura are hoping to take the sting out of the loss. Visit Ventura has pivoted its marketing to focus more on areas people can drive from, especially with states like Colorado and Texas.

“Things are still moving forward,” said Marlyss Auster, CEO of Visit Ventura. “Business just looks a little different.”

EDUCATION

UC Santa Barbara made the decision March 10 to have all classes through April taught remotely as part of social distancing. The university is also asking students, staff and faculty to be prepared to be away from campus through April, even though the campus’ dining and housing is staying open for students living on site.

UCSB is the only higher education institute in the tri-county area that has switched to remote instruction only, but other schools are preparing for the possibility. Santa Barbara City College is seeking approval from the State Chancellor’s Office to move in-person courses to an online format.

University systems all over California have canceled non-essential international travel, and UCSB encouraged its students, staff and faculty to strongly reconsider any personal travel, international or domestic. Cal Poly encouraged students not to travel for spring break but said it would hold in-person classes.

Elizabeth Say, provost of CSU Channel Islands, announced in a letter that all university-sponsored travel needed to be reviewed and approved, even if it was already approved, and the California State University system suspended all international and non-essential domestic travel through May 31.

Part of the canceled travel includes study abroad programs, such as Westmont College’s Singapore program, which has been canceled for the year.

Contact Amber Hair at [email protected] and Marissa Nall at [email protected]

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Staff Writer at Pacific Coast Business Times, Inc.

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