Twitter to raise $1.82B at market cap of $14.2B. Twitter (NYSE:TWTR) is due to debut on the NYSE today after pricing its IPO at $26, above an already increased range of $23-$25. Twitter will raise $1.82B by selling 70M shares and it will have a market cap of $14.2B despite generating no profits. That may be because CEO Dick Costolo seems to be following the Jeff Bezos playbook. "There's nothing structural about Twitter that prevents us from having the kind of margin profiles of our peer group," Costolo said. "We are investing for the long term."
Square reportedly exploring 2014 IPO. Just as one Jack Dorsey company (Twitter) gets ready to go public, his other big success, mobile payments upstart Square, is reportedly considering an IPO in 2014. Square, whose mobile card readers and iPad register app are beloved by many small businesses, raised a funding round last year at a $3.25B valuation. The company expects to generate $550M in 2013 sales on the back of $20B in processed transactions, as well as revenue of $1B next year. However, like Twitter, Square is unprofitable.
U.S. economy seen slowing. Q3 GDP data is due out this morning, with economists estimating that growth slowed to 2% on year from 2.5% in Q2. High Frequency Economics said that the causes of the deceleration included a smaller gain in homebuilding, partly because of a pickup in mortgage rates, and a narrower trade gap.
Top Stock News
Siemens' earnings fall; to buy back €4B in shares. Siemens' (SI) FQ4 income from continuing operations fell 13% to €1.08B but topped forecasts of €997M, while revenue slipped 1.3% to €21.2B. Siemens, which is carrying out a major restructuring after falling behind rivals such as GE (NYSE:GE), took a €688M charge related to the overhaul. However, the conglomerate expects its FY 2014 EPS to rise 15% from €5.08 in FY 2013. It also intends to buy back up to €4B of stock over the next two years. Shares were +3.15% premarket.
ArcelorMittal's core profit surges 19%, shares jump. ArcelorMittal's (NYSE:MT) Q3 earnings topped Street predictions as EBITDA climbed 19% to $1.71B, boosted by a 1-2% rise in steel shipments, a 20% increase in iron-ore shipments sold at market prices, and cost cuts. Sales at the world's largest steel maker slipped to $19.64B from $19.72B. "The bottom of the cycle is behind us," said CEO Lakshmi Mittal. "Although operating conditions remain challenging, as economic indicators are improving, we are cautiously optimistic about the prospects for 2014." Shares jumped 5.2% premarket.
Lenovo continues to grow PC sales as net profit surges 36%. Lenovo's (OTCPK:LNVGF) FQ2 earnings topped expectations as net profit rose 36% to $219.7M, lifted by higher margins in China and increased sales of smartphones. Revenue at the world's largest PC maker climbed 13% to $9.77B and beat consensus of $9.41B. Lenovo's world-wide PC shipments edged up 2% vs a sector-wide decline of 7.6%, while smartphone shipments soared by over 78% to 12.3M units.
Toll Bros. to buy California business for $1.6B; FQ4 sales leap. Toll Brothers (NYSE:TOL) has agreed to acquire the house-construction business of privately owned Shapell Industries for $1.6B in a transaction that will boost the luxury home-builder's presence in California. News of the purchase comes just a few days after Tri Pointe Homes (NYSE:TPH) agreed to merge with Weyerhaeuser's (NYSE:WY) home-building division in a $2.7B deal. Meanwhile, Toll estimated that its FQ4 revenue rose a preliminary 65% to $1.04B, topping consensus of $921.03M. Shares were +1% premarket.
Top Economic & Other News
Spanish industry grows for first time in 2 1/2 years. Spain continues to experience green shoots of recovery, with industrial output surprisingly rising 1.4% on year in September after falling 2.1% in August and beating consensus for a drop of 1.5%. The increase represents the first time that production has grown since February 2011 and adds to preliminary data showing that the economy emerged from recession in Q3.
Ireland poised to leave bailout process. The Troika is due to approve the final funds of Ireland's €85B ($114B) bailout today, which would allow the country to become the first to exit its rescue process, a move it could make by the end of the year. A question remains over whether Ireland will request a precautionary credit line when the bailout ends. The government has indicated that it may not, as it has enough funding to take it to 2015.
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In Asia, Japan -0.8% to 14228. Hong Kong -0.7% to 22881. China -0.5% to 2129. India -0.35% to 20823.
In Europe, at midday, London -0.2%. Paris -0.1%. Frankfurt flat.
Futures at 6:20: Dow -0.1%. S&P -0.15%. Nasdaq -0.2%. Crude +0.2% to $95.02. Gold -0.2% to $1315.20.
Ten-year Treasury Yield flat at 2.64%.
Today's economic calendar:
Chain Store Sales
8:30 Initial Jobless Claims
8:30 GDP Q3
9:45 Bloomberg Consumer Comfort Index
10:30 EIA Natural Gas Inventory
3:00 PM Consumer Credit
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Notable earnings before today's open: AAWW, AEE, AES, AMCX, AMRC, AMSC, ANSS, APA, APO, ARQL, ATK, BCE, BDBD, BKCC, BR, BZH, CBB, CCO, CMLP, CNK, CNQ, CNSL, COTY, CPN, CQB, DYN, EOG, FCN, FLO, FLY, FNP, FSYS, FUN, FUR, FWLT, FWM, GLP, GOLD, GTN, HII, HNT, IGT, IRC, IT, JRCC, KIOR, KLIC, LNT, LRN, MFC, MLM, MT, MWIV, MWW, NVAX, NWN, NXTM, RDN, RGEN, RGLD, ROK, SFUN, SMG, SNI, SSYS, STWD, THI, TICC, TK, TTI, TW, USAC, VC, VNDA, VTG, WEN, WIN, WLK, WMC, WWAV
Notable earnings after today's close: ADES, ADUS, AIRM, AL, ALJ, ANAC, ARAY, AREX, ARNA, ATLS, ATW, AUQ, AVG, BCEI, BEBE, BIO, BNNY, BPZ, CFN, CLNE, CUBE, DAR, DIS, DMD, EAC, EBS, ECPG, ELON, ENOC, EZPW, FEYE, FF, FUEL, FXEN, GERN, GRPN, GXP, HTGC, IL, KRO, KTOS, LCI, LFVN, MCP, MDRX, MITK, MNST, MNTX, MSCC, NES, NFG, NKTR, NOG, NVDA, OCLR, OLED, PCLN, PEGA, PODD, RNDY, SF, SGMS, SLXP, SNTS, SQNM, SWIR, TSRO, TUMI, UBNT, UNXL, VVC, WIFI, WR, WTR, XNPT, XTEX, YRCW
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