Posts Tagged ‘News Corp’
Frontrunning: May 20
Monday, 20 May 2013 06:32
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  • Obama’s Counsel Was Told of IRS Audit Findings Weeks Ago (WSJ)
  • North Korea fires sixth missile in three days (Reuters)
  • Enron No Lesson to Traders as EU Probes Oil-Price Manipulation (BBG)
  • Don’t cry for me, Eurozone: Thinking the Unthinkable – Quitting a Currency (WSJ)
  • H-1B Models Strut Into U. (Read more…)S. as Programmers Pray for Help (BBG)
  • Gold Bear Bets Reach Record as Soros Cuts Holdings (BBG)
  • Yahoo has agreed to pay $1.1 billion for Tumblr (WSJ)
  • JPMorgan Holders Led by Chairmen-CEOs to Vote on Dimon (BBG)
  • Apple faces grilling over US tax rate (FT)
  • Nissan to Sell First Joint Minicar to Expand in Japan Market (BBG)
  • Fierce battle for corporate loans sparks US bank risk concerns (FT)
  • Microsoft Updates Xbox as Apple to Facebook Gain in Games (BBG)

Overnight Media Digest

WSJ

* New York’s top financial regulator subpoenaed a handful of Wall Street investment firms about their entries into a corner of the insurance industry that guarantees steady payments to hundreds of thousands of retirees and other consumers.

The New York Department of Financial Services on Sunday sent subpoenas to Apollo Global Management LLC, Guggenheim Partners and Harbinger Group Inc as part of an investigation seeking more information on investments that back so-called fixed annuities, according to people familiar with the inquiry. ()

* Chesapeake Energy Corp has picked 46-year-old executive Robert Douglas Lawler from rival Anadarko Petroleum Corp to succeed its co-founder, Aubrey McClendon, as chief executive of the nation’s second-largest natural-gas producer.

* As 787 Dreamliner commercial flights resume after a lengthy grounding for battery problems, Boeing Co and its customers are refocusing on fixing the host of other technical and mechanical issues that affect the reliability of the cutting-edge aircraft.

* DirecTV is weighing a potential bid for Hulu, the latest company to show interest in the six year-old video site, according to a person familiar with the matter.

Other firms that have bid or expressed interest in Hulu include cable operator Time Warner Cable Inc, Guggenheim Partners, Yahoo Inc and former News Corp president Peter Chernin’s investment group.

* Roger Carr, chairman of U.K. gas utility Centrica Plc , is the front runner to replace Dick Olver as chairman of Britain’s defense contractor BAE Systems Plc, a person familiar with the matter said.

 

FT

Hennes & Mauritz is looking at sourcing clothes from Latin America and Africa for the first time with the retailer rethinking its sourcing strategy following the Bangladesh factory collapse.

Apple Inc Chief Executive Tim Cook will appear before the U.S. Senate’s permanent investigations subcommittee on Tuesday where he is likely to face questions over Apple’s tax planning.

U.S. hedge fund Monarch Capital plans to open an office in London as it looks to ramp up its European business at a time when financial institutions are increasingly selling troubled assets and undervalued loans.

Barry Sternlicht’s Starwood Capital is in talks with the developers of London’s Heron Tower to provide a 250 million pound loan to refinance the tallest skyscraper in the City.

Tesco Plc is looking at setting up a joint venture in China so it can keep expanding in the market but in way that will help it contain capital expenditure.

Yahoo Inc has agreed a deal to buy blogging and social networking site Tumblr for about $1 billion.

Bank of England Governor Mervyn King has warned finance minister George Osborne that his scheme to boost mortgage lending could cause future problems.

 

NYT

* Yahoo’s move to purchase Tumblr aims to make up for years of missing out on the growth of social networks and mobile devices.

* Three months after hackers working for a cyber unit of China’s People’s Liberation Army went silent amid evidence that they had stolen data from scores of American companies and government agencies, they appear to have resumed their attacks using different techniques, according to computer industry security experts and American officials.

* The Swedish retail giant H&M faced public pressure to accelerate its efforts to improve garment factory conditions, though it had no ties to a disaster in Bangladesh.

* Executives from Silicon Valley say that the Senate immigration bill imposes too much regulatory control over a company’s hiring of temporary foreign workers or laying off an American worker.

* At JPMorgan Chase, the move to split the jobs of chairman and chief executive, now held by Jamie Dimon, comes as the bank is actually prospering.

* Gary Pruitt, the head of The Associated Press, said the Obama administration’s handling of a leak investigation had already diminished journalists’ capacity to report on the government.

* Given the more generous subsidies offered in other states and countries, major studios including NBCUniversal, Paramount and Disney all have large-scale, long-term expansion plans.

 

Canada

THE GLOBE AND MAIL

* Prime Minister Stephen Harper’s chief of staff has resigned over his role in the C$90,000 ($87,600) bailout of former Conservative Senator Mike Duffy’s expense account. Nigel Wright issued a statement Sunday morning to announce his resignation, which Harper has accepted.

* The federal government is spending hundreds of thousands of dollars advertising a program that does not yet exist. Prime-time ads began airing this week during NHL playoff games – currently the priciest advertising real estate on the dial – that tout a new Canada Jobs Grant for training workers. The trouble is, the freshly announced program is at present little more than a concept that has yet to be negotiated with provincial governments, and requires buy-in from employers as well.

Reports in the business section:

* PBF Energy Inc is making a big bet to bring Alberta crude by train to its refinery near Philadelphia. The company is already receiving 40,000 barrels per day of Alberta’s oil sands bitumen by rail at its Delaware City refinery on the U.S. East Coast, and is working to double that capacity to 80,000 barrels each day. But the rail strategy of PBF and other energy players took a knock this week from Prime Minister Stephen Harper, who questioned the environmental impacts of crude by rail.

NATIONAL POST

* A group that includes some prominent Canadian actors, writers and politicians is calling on Prime Minister Stephen Harper to change the name of Victoria Day. Author Margaret Atwood, Green Party leader Elizabeth May and actor Gordon Pinsent are among those behind an online petition to rename the public holiday, which is celebrated on Monday, as “Victoria and First Peoples Day.”

FINANCIAL POST

* In 2008, Ottawa took bold steps explicitly designed to shake up a wireless communications sector dominated by three big players, determined to give consumers more choice and a break on pricing. Five years later, competition may have has cropped up in some regions, but new entrants serving Ontario, Alberta and British Columbia are floundering and the federal government’s strategy looks to have failed, leaving many wondering what went wrong and whether there’s any hope for a viable fourth competitor in those markets.

* Canada’s Competition Bureau is gearing up to launch a formal inquiry into the business practices of Google Inc’s Canadian operations. Google was recently notified by the Competition Bureau of the watchdog organization’s intentions to investigate the Silicon Valley giant’s business in Canada.

 

China

CHINA SECURITIES JOURNAL

- More cities are expected to be included in a property tax pilot scheme, which now involves only Shanghai and Chongqing, sources said.

- The price of newly built commercial homes rose 0.95 percent in April in 70 large and medium cities, 0.14 percentage points slower than the pace of growth between February and March, which is the first such decline in seven months.

SECURITIES TIMES

- Investment in the real estate industry in Shanghai surged 50.4 percent to 21.27 billion yuan ($3.46 billion) in April.

CHINA DAILY

- A higher court in Hunan province has accepted the appeal of a woman sentenced to “re-education through labour” and who is now seeking an apology and compensation from the government. The woman was sentenced after repeatedly petitioning the government for justice for her daughter, who was kidnapped, raped and forced into prostitution.

SHANGHAI DAILY

- A draft amendment of the consumer rights law will mandate a minimum compensation of 500 yuan for consumers if they are found to be victims of fraud, said a senior official at Shanghai’s market watchdog. The existing regulation stipulates compensation equal to the price of the product.

GLOBAL TIMES

- The situation in the China-India border areas is much better than that on Diaoyu Islands and other disputed islands in South China Sea, an editorial said. India and China have both been trying to divert the focus of their relationship from border disputes to other areas and share a common will in terms of preventing border problems.

Corporate Finance

* Greece’s second-largest lender Piraeus Bank SA has hired four international investment banks as advisers on its 7.33-billion-euro ($9.4 billion) share issue, two bankers close to the procedure told Reuters on Saturday.

* Yahoo Inc’s board has approved a deal to buy blogging and social networking site Tumblr for $1.1 billion in cash, the Wall Street Journal cited people familiar with the matter as saying on Sunday.

* The offer for miner Eurasian Natural Resources Corp made by its founding shareholders and the Kazakh government included shares in rival miner Kazakhmys Plc, a British newspaper reported on Sunday.

* Bus and rail operator FirstGroup Plc plans to announce a 600-million-pound ($918.48 million) rights issue in the coming days to help pay off debt, British media reported on Sunday.

* The French stock market authority has found LVMH Moet Hennessey Louis Vuitton secretly bought shares in rival Hermes International SCA to build a stake, and not merely make a financial investment as the luxury group has claimed, a newspaper reported.

* Qatar Holding and an Italian state-controlled investment fund are interested in investing in Italian fashion house Versace, Il Sole 24 Ore said on Saturday.

 

Fly On The Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

Abbott (ABT) upgraded to Buy from Neutral at Goldman
Accenture (ACN) upgraded to Buy from Neutral at Goldman
NetEase.com (NTES) upgraded to Buy from Neutral at Citigroup
Northrop Grumman (NOC) upgraded to Fair Value from Sell at CRT Capital
Pandora (P) upgraded to Equal Weight from Underweight at Barclays
priceline.com (PCLN) upgraded to Buy from Hold at Deutsche Bank
Realogy (RLGY) upgraded to Buy from Fair Value at CRT Capital
T-Mobile (TMUS) upgraded to Buy from Hold at Deutsche Bank
Vectren (VVC) upgraded to Outperform from Neutral at RW Baird
WNS Holdings (WNS) upgraded to Buy from Neutral at Goldman

Downgrades

Artisan Partners (APAM) downgraded to Market Perform from Outperform at Keefe Bruyette
Bank of America (BAC) downgraded to Market Perform from Outperform at Keefe Bruyette
Bed Bath & Beyond (BBBY) downgraded to Hold from Buy at Jefferies
BlackRock (BLK) downgraded to Market Perform from Outperform at Keefe Bruyette
Cavium (CAVM) downgraded to Market Perform from Outperform at JMP Securities
Charles Schwab (SCHW) downgraded to Underperform from Market Perform at Keefe Bruyette
Dunkin’ Brands (DNKN) downgraded to Neutral from Buy at Longbow
Equifax (EFX) downgraded to Neutral from Buy at Goldman
Leap Wireless (LEAP) downgraded to Sell from Hold at Deutsche Bank
Lowe’s (LOW) downgraded to Perform from Outperform at Oppenheimer
MicroStrategy (MSTR) downgraded to Market Perform from Outperform at JMP Securities
NetApp (NTAP) downgraded to Underperform from Neutral at RW Baird
NeuStar (NSR) downgraded to Neutral from Buy at Goldman
Red Hat (RHT) downgraded to Market Perform from Outperform at BMO Capital
Ruby Tuesday (RT) downgraded to Market Perform from Outperform at Wells Fargo
Synovus (SNV) downgraded to Sell from Neutral at Goldman
TD Ameritrade (AMTD) downgraded to Underperform from Market Perform at Keefe Bruyette
Thoratec (THOR) downgraded to Neutral from Buy at Goldman

Initiations

M/I Homes (MHO) initiated with an Overweight at JPMorgan
Michael Kors (KORS) initiated with a Buy at Canaccord
MusclePharm (MSLP) initiated with a Strong Buy at Ascendiant Capital
Taylor Morrison (TMHC) initiated with a Buy at Citigroup
Taylor Morrison (TMHC) initiated with an Outperform at Credit Suisse
Taylor Morrison (TMHC) initiated with an Overweight at JPMorgan

HOT STOCKS

GE Capital board to pay $6.5B of dividends to parent GE (GE) in 2013
Accenture (ACN) acquired Acquity Group (AQ) for $316M
Fitch affirmed Verizon’s (VZ) IDR at ‘A’, outlook stable
Elan (ELN) announced transactions to transform company, $200M share repurchase plan
Live Nation (LYV) formed JV with Lushington Entertainments in Asia

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
JA Solar (JASO)

Companies that matched consensus earnings expectations include:
Qihoo 360 (QIHU)

NEWSPAPERS/WEBSITES

  • The New York Department of Financial Services yesterday sent subpoenas to Apollo Global Management (APO), Guggenheim Partners and Harbinger Group (HRG) as part of an investigation seeking more information on investments that back so-called fixed annuities, sources say, the Wall Street Journal reports
  • As Home Depot (HD) and Lowe’s (LOW) report fiscal Q1 results this week, the reconstruction phase from last year’s superstorm Sandy will be looming large as cooler-than-normal temperatures delay spring selling, the Wall Street Journal reports.
  • Danone Group (DANOY) will invest $417M in two deals with China Mengniu Dairy Co., marking a comeback for the French group in China where scandals have hurt confidence in food safety, Reuters reports
  • The Nikkei share average surged to a new 5 1/2 year high today, boosted by further weakness in the yen and optimism over the growth outlook after the Japanese government raised its assessment of the economy for the first time in two months, Reuters reports
  • The longest decline in Treasuries this year has left U.S. government debt the cheapest since March 2011 when measured by real yields and the best relative value compared with German bunds in more than two decades, Bloomberg reports
  • As JPMorgan Chase’s (JPM) Jamie Dimon prepares for a vote Tuesday on whether he should keep his chairman and CEO titles, he may take comfort knowing that seven of the bank’s 10 largest owners are run by CEOs who are also chairmen, Bloomberg reports

BARRON’S

Cisco (CSCO) looks the best of tech comeback stocks (MSFT, INTC)
Walter Energy (WLT) executives bought shares near lows
Ryder (R) shares could see $75
Tencent Holdings (TCEHY) stock could rise 20%
France Telecom (FTE) could provide investors with short-term gains but Telefonica (TEF),   Deutsche Telekom (DTEGY) are better long-term options
ING U.S. (VOYA) could see 30% or more jump in share price as ING Groep (ING) must fully divest by December 31, 2016
Northfield Bancorp (NFBK) looks attractive
Time to ring the cash register in Big 5 Sporting (BGFV)
Bears’ arguments for Orbitz (OWW) are more convincing
Six Flags (SIX) may eventually disappoint

SYNDICATE

CombiMatrix (CBMX) files to sell 1.06M shares for holders
PLX Technology (PLXT) files to sell $30M of common stock, depositary shares
Saul Centers (BFS) files to sell 15.5M shares for holders
Ubiquiti Networks (UBNT) files to sell 7.7M shares for holders

    



 
Frontrunning: May 9
Thursday, 09 May 2013 06:24
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  • Einhorn’s advice to investors: don’t take my advice (Reuters)
  • Next: floating dead vegetables: Chinese inflation rises on soaring vegetable prices (FT)
  • The scramble for the bottom dollar is on: McDonald’s, Wendy’s Battle for Value-Centric Customers (WSJ)
  • Cheaper iPhone coming after all: Apple supplier Pegatron boosts China workforce by 40 percent in second quarter (Reuters)
  • House set to pass tactical Republican debt bill (Reuters)

    • (Read more…)

  • Underwriting bonanza: Goldman Said to Earn $500 Million Arranging Malaysia Bond (BBG)
  • G7 finance chiefs to discuss bank reform push (Reuters)
  • Big Banks Push Back Against Tighter Rules (WSJ)
  • University endowments trim holdings in US Treasuries (FT)
  • Ex-Pakistan PM’s son abducted as Taliban threaten poll (Reuters)
  • China Dowry Filled With Gold Signals Gains for Jewelers (BBG)
  • As discussed here over a year ago: China inflation data shows central bank policy dilemma (Reuters)
  • Police Report Describes Nightmare Scenario of Three Women Chained in Cleveland Home (WSJ)
  • GM Says Most Silverado Sales This Year Will Be Old Truck (BBG)

 

Overnight Media Digest

WSJ

* The nation’s biggest banks are going on the offensive to fend off growing efforts in Washington to rein them in.

* Across the U.S., earnings season came and went with few signs that companies are taking advantage of the SEC’s green light to tweet or post market moving information.

* Enron’s former president and CEO Jeffrey Skilling and the Justice Department have reached an agreement that would cut his federal prison sentence to as little as 14 years from 24 years.

* In-flight Internet speeds could rival those on the ground under a proposal expected to move forward on Thursday. U.S. airlines have been rolling out internet service on flights for several years. But the service, which typically uses Earth-based antennas, is often too slow for today’s data-guzzling Web apps.

* Samsung’s Galaxy S4 smartphone takes advantage of the South Korean electronics company’s chip and display manufacturing prowess to get its materials costs close to Apple’s iPhone 5.

 

FT

Former Enron CEO Jeffrey Skilling could see his sentence shortened by 10 years as part of a deal with the U.S. Department of Justice.

JPMorgan has been warned that the U.S. Federal Energy Regulatory Commission “intends to recommend” an enforcement action against the bank and “certain firm personnel.”

Coca-Cola will adopt clearer calorie-count labels, promote diet drinks and back a pledge not to market to children under 12 in an attempt to help fight obesity.

BAE forecast modest growth as it attempts to offset shrinking defence spending in the U.S. and Europe with new business from countries like Saudi Arabia.

Sainsbury Chief Executive Justin King has asked the government to “think hard” on the lack of a level playing field on tax between international internet retailers and high street stores.

The Financial Conduct Authority has begun a new probe looking at banks and asset managers’ activities that help pension funds make significant changes to their investment portfolios.

Prime Minister David Cameron made immigration the central point of his Queen’s Speech in an attempt to slow down the rise of the UK Independence party.

 

NYT

* Three weeks after checks sent to homeowners as compensation for foreclosure abuses were rejected for insufficient funds, Rust Consulting, the consulting firm at the center of the mishap, erred again: a fresh round of checks was written for the wrong amounts.

* With fair-trade coffee and organic fruit now prolific, consumers concerned with working conditions and environmental issues are demanding more disclosure about what they wear.

* The advocacy group Fwd.Us, created by Facebook’s Mark Zuckerberg and others, has shocked some liberals with its tactics in a campaign to support immigration reform.

* Should U.S. President Barack Obama approve the 1,700-mile Keystone XL pipeline, some foes of the project say he ought to address climate policy at the same time.

* A bipartisan group of senators introduced legislation that would deny the Iranian government access to its foreign exchange reserves parked in the banks of other countries, estimated to be worth as much as $100 billion, mostly in euros.

* A combination of weak exports and slowly rising consumer spending in China prompted concerns among economists about sustaining even modest growth.

 

Canada

THE GLOBE AND MAIL

* Canada’s Natural Resources Minister Joe Oliver is raising the prospect of a trade fight with the European Union over its proposal to label oil sands crude as dirty even as both sides try to seal a major deal to liberalize two-way trade.

* The Quebec government is preparing to table a Mining Act that will require companies to be socially and environmentally accountable to the local communities they operate in while being closely monitored to ensure the rules will be followed.

Reports in the business section:

* Wireless upstart Mobilicity has scoured the globe to find a willing buyer but despite “extensive marketing efforts,” the Vaughan, Ontario-based carrier has yet to clinch a binding sale agreement. And time is running out for it to do so before its debt holders vote on two plans of arrangement related to its restructuring later this month.

NATIONAL POST

* Amid rising speculation about a suspicious package found at Department of National Defence headquarters, an Ottawa bomb squad commander said Wednesday it contained “elements” of an improvised explosive device, but lacked the crucial explosive materials needed to make a real bomb.

* Ontario Premier Kathleen Wynne has reshuffled her cabinet after one of her ministers was rushed to hospital. Officials say Government Services Minister Harinder Takhar has resigned due to medical issues after being rushed to hospital during his mother’s funeral.

FINANCIAL POST

* Canada’s condominium sector continues to show signs of a serious slowdown and a report Wednesday suggests lenders are growing wary of the country’s largest highrise market.

* First Nations from British Columbia urged Enbridge Inc on Wednesday to start an exit strategy for its proposed Northern Gateway oil sands pipeline, or face lengthy legal action. But Chief Executive Al Monaco said Enbridge is focused on the regulatory review that is nearing completion and that the company wants to continue to engage with those affected to build a better project.

 

China

SHANGHAI SECURITIES NEWS

– China has already drafted plans to crack down on the issue of oversupply in industries including steel, cement and glass, authoritative sources told the official paper. All new projects will be strictly controlled, while those that go against regulations will be harshly punished.

– Surprisingly good export data has been met with some mistrust in China. The official paper asked whether Wednesday’s data showed real improvement or was just a “flash in the pan”.

CHINA SECURITIES JOURNAL

– China is currently formulating policies to assist top agriculture companies establish co-operatives. Bodies including the agriculture and finance ministries will allocate 5 billion yuan ($814.20 million) to fund the development with the aim of boosting agricultural productivity.

CHINA DAILY

– China plans to double its number of offshore air patrols by 2015 as tensions continue to simmer in the East and South China Seas, according to a official report from the China Institute for Marine Affairs.

SHANGHAI DAILY

– China’s financial hub is set to launch a plan to remove toxic materials from the soil around former industrial and chemical sites, Wu Qizhou, deputy director of the Shanghai Environment Protection Bureau said on Wednesday.

– The number of cases involving financial fraud in Shanghai rose to 2,490 in 2012, a 78.5 percent increase against a year earlier, according to data from the Shanghai City Procuratorate.

PEOPLE’S DAILY

– China’s public expenditure on education hit 2.2 trillion yuan ($358.25 billion) in 2012, accounting for 4 percent of the country’s GDP, the Ministry of Finance said on Wednesday.

 

Fly On The Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

American Water (AWK) upgraded to Outperform from Market Perform at Wells Fargo
Banco Bilbao (BBVA) upgraded to Buy from Hold at Societe Generale
Maidenform (MFB) upgraded to Buy from Hold at Brean Capital
Rackspace (RAX) upgraded to Overweight from Equal Weight at Stephens
ViaSat (VSAT) upgraded to Outperform from Perform at Oppenheimer

Downgrades

BlackRock (BLK) downgraded to Neutral from Buy at Citigroup
Chesapeake Lodging (CHSP) downgraded to Hold from Buy at Deutsche Bank
Compass Diversified (CODI) downgraded to Neutral from Buy at Janney Capital
LivePerson (LPSN) downgrade to Underperform from Neutral at Credit Suisse
Orthofix (OFIX) downgraded to Market Perform from Outperform at JMP Securities
Orthofix (OFIX) downgraded to Neutral from Buy at Janney Capital
Orthofix (OFIX) downgraded to Neutral from Buy at Mizuho
Rackspace (RAX) downgraded to Equal Weight from Overweight at Evercore
Rackspace (RAX) downgraded to Sector Perform from Outperform at RBC Capital
Rackspace (RAX) downgraded to Sell from Underperform at CLSA
Tesla (TSLA) downgraded to Neutral from Buy at Goldman
Tim Hortons (THI) downgraded to Equal Weight from Overweight at Barclays
Transcept (TSPT) downgraded to Market Perform from Outperform at Leerink
Transmontaigne Partners (TLP) downgraded to Neutral from Buy at BofA/Merrill
Tumi (TUMI) downgraded to Neutral from Buy at Citigroup

Initiations

Chicago Bridge & Iron (CBI) initiated with a Buy at Deutsche Bank
Fluor (FLR) initiated with a Buy at Deutsche Bank
Infinity Pharmaceuticals (INFI) initiated with an Outperform at Wells Fargo
Jacobs Engineering (JEC) initiated with a Hold at Deutsche Bank
KBR (KBR) initiated with a Buy at Deutsche Bank
MasTec (MTZ) initiated with a Buy at Deutsche Bank
McDermott (MDR) initiated with a Hold at Deutsche Bank
Merit Medical (MMSI) initiated with a Hold at Benchmark Co.
Ocean Power (OPTT) initiated with a Strong Buy at Ascendiant Capital
Quanta Services (PWR) initiated with a Buy at Deutsche Bank

HOT STOCKS

Green Mountain (GMCR), Starbucks (SBUX) entered into long-term strategic partnership
JPMorgan (JPM) received ‘wells-type’ notice from Federal Energy Regulatory Commission
on energy probe, Bloomberg reports
MarkWest Energy (MWE) to acquire certain midstream assets in the Anadarko Basin from a Chesapeake Energy (CHK) subsidiary for $245M
Greenlight Capital’s (GLRE) David Einhorn said he was bullish on Oil States International (OIS) at the Sohn Conference
Aflac’s (AFL) A+ rating affirmed by A.M. Best
Six Flags (SIX) announced two-for-one stock split
Outdoor Channel (OUTD) to receive $10.25 per share in merger with Kroenke Sports

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
Visteon (VC), Delek US (DK), Sun Life Financial (SLF), Neenah Paper (NP), RLJ Lodging Trust (RLJ), Medifast (MED), Sunoco Logistics (SXL), Tesla (TSLA), Rosetta Stone (RST), CenturyLink (CTL), Activision Blizzard (ATVI), Green Mountain (GMCR)

Companies that missed consensus earnings expectations include:
Bombardier (BDRBF), AES Corp. (AES), Kronos Worldwide (KRO), Regency Energy Partners (RGP), Cenveo (CVO), Transocean (RIG), McDermott (MDR), Quantum (QTM), Monster Beverage (MNST)

Companies that matched consensus earnings expectations include:
Fifth Street Finance (FSC), Denison Mines (DNN), Groupon (GRPN), News Corp. (NWSA)

NEWSPAPERS/WEBSITES

  • The rush into junk bonds passed another milestone, showing investors are putting aside concerns about the health of the U.S. economy. The Barclays U.S. Corporate High Yield index fell to a record low of 4.96%, only the second time the benchmark tracking debt issued by weaker U.S. companies dropped below 5%, the Wall Street Journal reports
  • McDonald’s (MCD) and Wendy’s (WEN) are struggling to attract cost-conscious consumers who are demanding better deals than even these low-price fast-food chains offer, the Wall Street Journal reports
  • Greenlight Capital’s (GLRE) David Einhorn, one of the most closely followed managers in the $2T hedge fund industry, had some blunt advice for his fellow investors: “It doesn’t make sense to blindly follow me or anyone else into a stock. “Do your own work,” Reuters reports
  • Pegatron Corp, an assembler of Apple’s (AAPL) iPhone and iPad, said it would increase its number of workers in China by up to 40% in the second half of the year, fueling market speculation of a new cheaper iPhone, Reuters reports
  • Mining companies led by BHP Billiton (BHP) are holding the biggest ever sale of assets this year–about $48B–just as commodity prices head into a bear market. What’s bad timing for the miners might be the opposite for private equity, Bloomberg reports
  • Citigroup (C) reduced Deutsche Bank’s (DB) lead as the biggest currency trader in a Euromoney Institutional Investor poll, helped by its larger share of emerging-market transactions, Bloomberg reports

SYNDICATE

American Residential Properties (ARPI) 13.7M share IPO priced at $21.00
Cyan (CYNI) 8M share IPO priced at $11.00
Ellington Financial (EFC) announces public offering of 5M common shares
Emerge Energy Services (EMES) 7.5M share IPO priced at $17.00
Health Care REIT (HCN) 20M share Spot Secondary priced at $73.50
Isis Pharmaceuticals (ISIS) 9M share Secondary priced at $19.00
PennyMac Financial (PFSI) 11.1M share IPO priced at $18.00
Quintiles Transnational (Q) 23.68M share IPO priced at $40.00
Receptos (RCPT) 5.2M share IPO priced at $14.00
Resolute Energy (REN) 13.25M share Secondary priced at $8.00
SS&C Technologies (SSNC) files to sell 7.5M shares for holders
TriState Capital (TSC) 5.7M share IPO priced at $11.50

ACTIVIST/PASSIVE FILINGS

SAC Capital reports 5.3% passive stake in Nexstar (NXST)
Corvex confirms 5.77% stake in tw telecom (TWTC)

    



 
Frontrunning: March 26
Tuesday, 26 March 2013 06:32
No Comments
  • Berezovsky Died of Hanging Without Struggle, Police Say (BBG)
  • BRICS Nations Plan New Bank to Bypass World Bank, IMF (BBG)
  • China pledges more investments to Africa (FT)
  • BOJ’s Kuroda signals targeting longer-dated JGBs (Reuters)
  • North Korea orders artillery to be combat ready, targeting U. (Read more…)S. bases (Reuters)
  • Supreme Court to take up gay marriage for the first time (Reuters)
  • U.S. Cracks Down on ‘Forced’ Insurance (WSJ)
  • Japanese courts press Abe on electoral reform (FT)
  • Vietnam accuses China of attack on fishermen in South China Sea (Reuters)
  • Italy’s High Court Overturns Knox Acquittal (WSJ)
  • Facebook’s Zuckerberg Said to Explore Forming Political Group (BBG)

 

Overnight Media Digest

WSJ

* Dell Inc said it received two alternative acquisition proposals from Blackstone and activist investor Carl Icahn, following a $24.4 billion deal last month to be taken private by founder Michael Dell.

* The BlackBerry Z10 phone from BlackBerry has received tepid marketing support from AT&T since its debut in stores on Friday, dealing the company an early setback in its drive to improve sales in the crucial U.S. market.

* Boeing Co began the first in a series of 787 Dreamliner test flights on Monday, preparing for regulators to evaluate changes to its lithium-ion battery system and marking another step in the plane maker’s effort to return the jet to commercial service.

* Centrica Plc, one of the UK’s main energy providers, has signed a deal to buy billions of cubic meters of liquefied natural gas from a U.S. plant, in the first deal clearly intended to bring gas from North America to the UK.

* The U.S. Department of Transportation proposed a $1.7 million fine against Exxon Mobil Corp for failing to properly prepare for what the department says were known flooding risks to one of its pipelines that ruptured in 2011 and spilled 1,500 barrels of crude into Montana’s Yellowstone River.

* T-Mobile USA has become the first major wireless carrier in the United States to drop smartphone subsidies, moving away from a model that has helped companies like Apple Inc bank large profits at a steep cost to carriers’ margins.

* Oracle Corp on Monday said it agreed to acquire telecommunications software provider Tekelec, continuing a recent effort to profit from the explosion of smartphones and tablet computers burdening carriers’ networks.

* Beijing-based Li Ning Co Ltd said in a statement to the Hong Kong Stock Exchange that it plans to downsize after reporting a $318.8 million loss for 2012 and a 25 percent drop in revenue.

* Online video site Hulu has had talks with several potential buyers including Guggenheim Partners, one of several options the company, owned by News Corp and Walt Disney Co, is considering as it tries to resolve uncertainty about its strategic direction.

* A Kuwaiti sheik alleges that a senior executive at Switzerland’s UBS AG offered $20 million to get the bank an advisory role on one of the biggest-ever acquisitions in the Middle East, but the bank later backed out of the deal, according to the sheik’s testimony in a Dubai court case.

* Canada’s Bombardier Inc has condensed its production plans for a second, larger version of its CSeries jetliners to try to keep its tight schedule for the first deliveries of the new planes, according to people familiar with the matter.

* Law firm Howrey LLP was in a “death spiral” for nearly two years, according to new lawsuits that claim the firm’s partners didn’t seem to know the depth of its financial problems.

 

FT

Fund manager Schroders Plc is to pay 424 million pounds ($646 million) for smaller rival Cazenove Capital, as it moves to bulk up its private banking arm running money for wealthy clients. Michael Dell is willing to explore the possibility of working with Blackstone Group LP and Carl Icahn regarding alternative offers for Dell

U.S. regulators approved Nasdaq OMX Group’s $62 million compensation plan for firms that lost money in Facebook Inc’s glitch-ridden market debut.

Yahoo Inc has snapped up mobile news aggregator Summly, founded by 17-year-old Nick D’Aloisio two years ago from his home in London.

Cynthia Carroll, the outgoing chief executive of Anglo American , warned mining industry shareholders to either get out of the sector or adjust their expectations.

Dutch package delivery firm TNT Express said the sale process of its Chinese business is underway and that it is pursuing the sale of its Brazilian arm.

Britain’s Centrica Plc signed a long-term deal to import U.S. natural gas at a time when the domestic gas production continues to decline while U.S. output hits record highs.

 

NYT

* Michael Dell considers Blackstone Group LP’s preliminary proposal for Dell Inc to be potentially friendly to management and may reach out to talk later this week, a person briefed on the matter said on Monday.

* Facebook Inc is no longer relying solely on what its users reveal. Instead, it is tapping outside data sources to learn even more about them, and to sell more finely targeted ads.

* Concord Music Group, an independent music company with an artist roster that includes Paul McCartney, Paul Simon and Creedence Clearwater Revival, has been sold to Wood Creek Capital Management, a private equity firm that has been quietly building a collection of music assets.

* Rengan Rajaratnam pleaded not guilty on Monday to insider trading charges while he worked for the now-defunct Galleon Group, coming nearly two years after the conviction of his older brother, the fallen hedge fund titan Raj Rajaratnam.

* Shares in Bankia SA, the giant Spanish mortgage lender whose collapse last year led to a banking crisis in Spain, slumped on Monday in the first day of trading after regulators wiped out most of the stock’s value.

Regulators said on Friday that Bankia shares would be revalued at 1 cent each as the custodial managers who now oversee the bank try to create a clean slate. The new valuation was a condition of Bankia getting a capital injection of 10.7 billion euros ($13.9 billion) from European rescue funds.

* A survey of 800 large and midsize employers including PepsiCo Inc and Wal-Mart Stores Inc found that employers are increasingly trying to lower healthcare costs by using incentives to persuade workers to make better lifestyle choices.

* Puerto Rico has gone on a campaign to promote tax incentives that took effect last year, marketing its beautiful beaches, private schools and bargain costs in an effort to lure affluent American hedge fund managers and business executives to its shores.

* Messages from the world’s largest law firm, DLA Piper, disclosed in a dispute over fees, will likely add to a perception that law firms inflate bills by performing superfluous tasks and overstaffing assignment

 

Canada

THE GLOBE AND MAIL

* Companies hoping to snag a piece of the biggest roadwork contract in Quebec’s history will first have to prove they’re corruption-free, a major test for the province as it aims to fix its failing infrastructure while tackling graft in the construction industry.

* Ontario premier Kathleen Wynne has stepped up her push for new taxes or tolls to pay for public transit expansion, warning that without such measures, badly needed infrastructure will never see the light of day.

Reports in the business section:

* Finance Minister Jim Flaherty says Canada is nearing an elusive free-trade agreement with South Korea, but some Canadian exporters warn they are years behind other countries that already have deals with the Asian manufacturing powerhouse.

* Canada’s New Democratic Party (NDP) is about to reintroduce legislation designed to ensure Canadian companies are not using conflict minerals in their supply chain – and that consumers can be certain their smartphones and other electronics are free of minerals fuelling violence in the Democratic Republic of the Congo.

NATIONAL POST

* Conservative MP Mark Warawa, who wants Canadian parliamentarians to condemn sex-selection abortions, is refusing to back down after his motion was deemed out of order last week by a House of Commons committee.

Warawa is urging MPs to reverse that decision and allow a vote in the Commons on the issue. He will plead his case on Wednesday to the Commons’ procedural affairs committee.

FINANCIAL POST

* The apparently lacklustre sales of BlackBerry’s new flagship Z10 handset in the United States have caused some observers to wonder if the delayed launch in the smartphone maker’s most important market have dealt a blow to its chance at a comeback.

 

China

CHINA SECURITIES JOURNAL

– China Investment Corporation has signed a contract with Russian companies to work together in promoting infrastructure investment and development in far eastern Russia, according to an official announcement.

– Dongfeng Automobile Co Ltd reported a 95 percent fall in net profit to 21.7 million yuan and a 17 percent fall in revenue to 17.7 billion yuan in 2012, according to the company’s annual report.

– Bright Dairy and Food Co. reported a 31 percent rise in 2012 net profit to 311 million yuan. The firm hopes to achieve 15.8 billion yuan in revenue this year.

SHANGHAI SECURITIES NEWS

– China’s inflation could fall to around 2 percent in March from a year earlier and the whole year number is likely to be around 2.6 percent, said Song Guoqing, member of the Central Bank Monetary Policy Committee, adding that gross domestic product (GDP) could grow 8.3 percent.

– China’s Securities Regulatory Commission, Beijing branch said it will promote securities companies to list in the stock market.

PEOPLE’S DAILY

– Chinese President Xi Jinping will be invited to the opening ceremony of the Boao Forum for Asia (BFA) Annual Conference 2013 and he will deliver a keynote speech.

– China should crack down on ‘naked officials’ — officials who have most of their assets and close family abroad — and seek to regulate and identify which cadres fall into this category.

 

Fly On The Wall 7:00 Market Snapshot

ANALYST RESEARCH

Upgrades

BroadSoft (BSFT) upgraded to Market Perform from Underperform at Raymond James
Electronic Arts (EA) upgraded to Overweight from Neutral at Piper Jaffray
Green Dot (GDOT) upgraded to Outperform from Market Perform at JMP Securities
LaSalle Hotel (LHO) upgraded to Outperform from Market Perform at BMO Capital
Peabody Energy (BTU) upgraded to Outperform from Market Perform at Raymond James
RF Micro Devices (RFMD) upgraded to Outperform from Perform at Oppenheimer

Downgrades

Ashland (ASH) downgraded to Neutral from Buy at Longbow
Cabot Oil & Gas (COG) downgraded to Hold from Buy at Stifel
Gordmans Stores (GMAN) downgraded to Hold from Buy at Stifel
Gordmans Stores (GMAN) downgraded to Neutral from Overweight at Piper Jaffray
Kraton Performance (KRA) downgraded to Perform from Outperform at Oppenheimer
Magellan Health (MGLN) downgraded to Market Perform from Outperform at Raymond James
MeadWestvaco (MWV) downgraded to Neutral from Buy at UBS
Southwestern Energy (SWN) downgraded to Hold from Buy at Stifel

Initiations

Brookfield Residential (BRP) initiated with a Buy at Citigroup
Fusion-io (FIO) initiated with a Perform at Oppenheimer
Luminex (LMNX) initiated with a Neutral at Wedbush
ON Semiconductor (ONNN) initiated with a Buy at BofA/Merrill
TRI Pointe Homes (TPH) initiated with an Outperform at FBR Capital

HOT STOCKS

Raytheon (RTN) said it will consolidate its businesses to streamline operations, and sees a workforce reduction of about 200 employees. The company also named Thomas Kennedy as COO
Magellan Health Services (MGLN) said that Magellan Complete Care of Arizona, a joint venture owned 80% by Magellan and 20% by Vanguard/Phoenix Health Plan, was notified by the state of Arizona that it was not selected as the Regional Behavioral Health Authority in GSA6; Maricopa County
Onyx Pharmaceuticals (ONXX) and Bayer (BAYRY) announced approval of Stivarga in Japan for the treatment of patients with metastatic colorectal cancer
Green Mountain (GMCR) appointed Michael Degnan Chief Legal Officer, General Counsel

EARNINGS/GUIDANCE

Companies that beat consensus earnings expectations last night and today include:
Children’s Place (PLCE), Gordmans Stores (GMAN)

Companies that missed consensus earnings expectations include:
Cascade Bancorp (CACB), U.S. Auto Parts (PRTS), Focus Media (FMCN)

Companies that matched consensus earnings expectations include:
AuRico Gold (AUQ), Sonic (SONC)

NEWSPAPERS/WEBSITES

  • The board of Hulu, which is owned by News Corp (NWSA) and Disney (DIS), has reached out to potential buyers to gauge interest in acquiring the company, according to Reuters.
  • T-Mobile (DTEGY) has decided to drop smartphone subsidies, becoming the first major wireless carrier in the U.S. to do so, reports the Wall Street Journal.
  • Several Supreme Court justices seemed skeptical about the practice of brand name pharmaceutical companies paying generic companies to keep their cheaper drugs off the market for a longer time, according to The New York Times.
  • Zynga (ZNGA) CIO Debra Chrapaty is leaving the company to become CEO of Nirvanix, an enterprise cloud storage company, according to an AllThingsD report.

SYNDICATE

ARCA Biopharma (ABIO) files to sell $20M in common stock, warrants
Arcos Dorados (ARCO) files to sell 2.3M shares of common stock for holders
Calumet Specialty Products (CLMT) files to sell 5.25M shares of common stock
Coastal Contacts (COA) files to sell common stock
Rainmaker Systems (RMKR) files to sell $7.2M in common stock
The First Bancorp (FNLC) 662K share Spot Secondary priced at $16.25