MARKET CURRENTS
real-time news and commentary for investors
MARKET CURRENTS
-
Monday, June 17, 2013
-
5:57 PM U.S. online retail sales rose 14.6% Y/Y in May, says comScore. That sits well with Cantor, which is reiterating a Buy on Amazon (AMZN) and eBay (EBAY). Though May's rate is down from April 16.9%, it's above Q1 13.3%. Mobile activity is providing a lift - comScore estimates mobile made up 48% of time spent on U.S. retail e-commerce activity in Q1 (34% from smartphones, 14% from tablets). Meanwhile, eBay CEO John Donahoe predicts China will give PayPal a license, thus allowing it to take on Alibaba's dominant AliPay service. eBay currently handles $6B/year worth of Chinese transactions, much of it from local merchants selling abroad. Analysys predicts the Chinese online payments market will soon top CNY1T ($163B). Comment!
-
5:08 PM Campbell (CPB) is acquiring Denmark's Kelsen Group, owner of the Kjeldsens and Royal Dansk baked snack brands (the latter is known to U.S. consumers for its butter cookies), from P-E firm Maj Invest for an undisclosed sum. Kelsen had 2012 sales of $180M, has been growing at a "compound double-digit rate" since '09, and has seen its Chinese sales grow at a 28% CAGR over the last 3 years. The deal will bolster a baked snack business that includes the Pepperidge Farm cookie/cracker brand, and the Arnotts Australian biscuit brand. It's expected to be "modestly accretive" starting in 2014. Comment!
-
3:47 PM Shares of Orchard Supply (OSH +12.7%) are higher today after announcing earlier it would voluntarily file for bankruptcy in an effort to sell itself to Lowe's (LOW). The stock initially soared over 90% on news that the deal would be worth around $205M, or approximately $34.17 per share, a massive premium to Friday's close of $1.88. However, details in the press release showed the numbers are a little more convoluted than previously thought. LOW will assume the debt owed to nearly all of OSH's supplier partners, which means the actual per share value of the deal is contingent on how much debt gets wiped out in bankruptcy court. Comment!
-
3:33 PM Hasbro (HAS +0.2%) strikes an expanded licensing deal with Rovio to develop more toys and games based on the Angry Birds brand. As part of the deal, a collaboration between Angry Birds Star Wars from Rovio Entertainment and LucasFilm will also be expanded. Comment!
-
3:27 PM Goldman (Buy, PT $62) says last Friday's sell-off in shares on Monster Beverage (MNST +0.3%) "seems overdone" as a proposal up for debate by the AMA "does not seem to contain new information." Comment!
-
-
2:54 PM Ingersoll-Rand (IR +0.3%) announces a private offering of senior notes, consisting of three tranches. The company intends to use the proceeds to fund the redemption of IR Global's existing $600M of 6.00% Senior Notes due in 2013 and $655M of its 9.5% Senior Notes due 2014, and to fund expenses related to the spin-off of its commercial and residential security businesses. Comment!
-
2:39 PM Out with the old. The Netflix-DreamWorks Animation deal signals an important change in the way content is distributed, according to industry watchers The most important part of the deal is that it focus on exclusive fresh content for Netflix (NFLX +6.8%) from DreamWorks (DWA +4%) - instead of just filling up a library with older titles. The big picture: A bidding war for new films from Hollywood studios (LGF, SNE, VIA, CMCSA, DIS) could help the industry maximize profits. George Lucas and Steven Spielberg called it (I, II) last week when they predicted giant upheaval for the film industry. 5 Comments
-
1:50 PM Natural Grocers by Vitamin Cottage (NGVC +7.7%) trades higher as stocks related to organic foods continue to draw attention. SA author Stephen Simpson draws an important distinction between the company and Whole Foods Market by noting the grocery concern is more of a pure-play on the organic industry and has its eyes set on a smaller square-footage footprint. Comment!
-
1:30 PM Nissan (NSANY.OB) is threatening to put a damper on the summer profits of the Big Three (GM, F, FIATY.PK) automakers with new aggressive pricing stemming from a lower yen and an urge to gain market share in the U.S. What to watch: Nissan's "scorched-earth" pricing policy is running up against an onslaught of new models from Detroit with positive reviews. The U.S. automakers may hold the line on prices - unless Toyota (TM) gets aggressive as well and forces the issue. 1 Comment
-
1:23 PM Macau gambling revenue rose 39% over the last week as both high VIP turnover and generous win percentage rates boosted sales for operators (LVS, MGM, MPEL, WYNN) in the region. Even if the pace slows down for the rest of June, the monthly revenue tally could easily exceed analyst estimates according to both RBC and Citi. 2 Comments
-
1:19 PM Alliant Techsystems (ATK +0.6%) says it's landed a $50M contract from Rolls-Royce (RYCEY.PK +0.2%) to produce aft fan composite cases for the new Trent XWB-97 engine. The contract has the potential to grow to more than $200M. Comment!
-
12:46 PM Cheesecake Factory (CAKE +1.1%) is back in a growth phase with new restaurants in Kuwait and Dubai as well as additional debuts planned for Asia. In the U.S., the company has kept a measured approach to growth since 2008, holding nearly steady at 162 outlets. What to watch: The company's Grand Lux Cafe and RockSugar Pan Asian Kitchen brands hold some interesting potential. Comment!
-
11:45 AM Deutsche Bank's Doug Mitchelson doesn't think Charter Communications (CHTR +1.6%) and Time Warner Cable (TWC -2.1%) can complete a deal that would pay TWC shareholders in the $110-$125 range. Instead, the analyst believes TWC shareholders would have to receive a price closer to $146 in order to satisfy the board. Also in the mix is Liberty Media (LMCA +0.7%) with its 27% stake in Charter. Comment!
-
11:07 AM Shares of Restoration Hardware (RH +2.6%) are up gain again to brush aside a negative take in Barron's amid Friday's earnings-inspired rally. SA contributor Brian Nichols called it over the weekend, noting that despite the recent rally the company still only trades at 1.8X sales and has upside potential to improve margins. Comment!
-
10:59 AM Ford (F +2.2%) thinks it can cut into losses in Europe as new higher-margin vehicles start to sell amid higher demand on the continent. Ford's head of sales in the region, Roelant de Waard, forecast sales in Ford’s main markets in Europe will increase about 3.7% Y/Y to about 14M in 2014. 1 Comment
-
10:49 AM Frontline (FRO +23%) soars after John Fredriksen backs the sector for gains due to "high growth" in LPG production. Other shipping stocks on the move: Ship Finance International (SFL) +1.5%, Seadrill (SDRL) +1.2%, StealthGas (GASS) +3.4%, GasLog (GLOG) +3.2%. 7 Comments
Latest Consumer Articles
