Today - Thursday, December 18, 2014
- On top of red ink and sluggish sales, and just days after Paula Schneider was named CEO, American Apparel's (NYSEMKT:APP) board is facing another headache.
- More than 30 execs have asked the board to reconsider their decision to fire Dov Charney, saying that he is what "makes this thing tick," and he should be a part of the retailer’s future by helping the next CEO improve the chain.
- APP +2.9% AH
- Takata (OTCPK:TKTDY) CEO Shigehisa Takada, who has not made a public appearance since June, said the company was analyzing collected inflators to determine the cause of defects with its air bags.
- "Takata is prioritizing the supply of replacement parts. We have sufficient funds put aside, and we are not concerned that we are under-capitalized," announced Takada.
- The Japanese air bag supplier has so far put aside $774M to deal with recalls, but it faces dozens of class-action lawsuits as well as a U.S. criminal investigation.
- After seeing the NYSE's market share erode to just 20% from nearly 80% a decade ago, ICE (NYSE:ICE) is pushing for a major overhaul that would restore the role of exchanges at the center of trading.
- Under the proposal, the NYSE would lower its fee for trading stocks by more than 80% if Wall Street banks and other new competitors agreed to a rule that would move more trading away from their so-called dark pools and off-exchange venues.
- Japanese shares rallied today following the Fed's upbeat assessment on the U.S. economy and report that the country will spend up to $30B in stimulus.
- Prime Minister Shinzo Abe plans to finalize the stimulus package on Dec. 27, as part of efforts to lift the economy out of a recession caused by the hit from a sales tax hike in April.
- Pulling away from a 6-1/2-week low, Japan's Nikkei share average jumped 2.3%, ending up 17,210.
- ETFs: DXJ, EWJ, DFJ, NKY, DBJP, EZJ, EWV, JPNL, DXJS, SCJ, JSC, ITF, JPP, HEWJ, FJP, QJPN, JPMV, DXJT, DXJR, DXJH, DXJC, DXJF
Wednesday, December 17, 2014
- "It's never going to happen," says Netflix (NASDAQ:NFLX) exec Cliff Edwards.
- Other streaming video services such as BBC iPlayer have added oflline download support, as have Spotify and many other music streaming services. However, Netflix (per Edwards) believes offline downloads are just a "short term fix for a bigger problem." Namely, getting reliable, high-quality Wi-Fi access away from home.
- Netflix might have another motive for opposing offline viewing: Keeping its huge bandwidth costs down. Whereas Netflix currently incurs bandwidth charges only when a user is actually watching a show, offline support raises the possibility users would download large volumes of content they'd never get around to seeing.
- Earlier: Netflix strikes deal with Dish
- A U.S. District Court today rejected Vale’s (NYSE:VALE) request to dismiss a lawsuit alleging it conspired with Israeli billionaire Benjamin Steinmetz to take a West African mine away from rival Rio Tinto (NYSE:RIO).
- The judge also dismissed Vale’s argument that the suit should be brought in an English court, saying Rio’s choice of a U.S. court is justified based on the plaintiff’s likelihood of obtaining jurisdiction over all of the defendants.
- The civil lawsuit, filed in April, alleges that Vale and its former partner Steinmetz worked together to take Rio’s rights to the Simandou iron ore deposit through corruption.
- Barrick Gold (NYSE:ABX) probably will take steps - perhaps as soon as tomorrow - to stop production at its Zambian operation after the country increased mining royalties, Bloomberg reports.
- Zambia's parliament approved the government's 2015 budget proposals, which will replace corporate income tax on mines with increased royalties and increase the rates on open-pit mines such as ABX’s Lumwana to 20% from 6%.
- The BP-led partnership developing Iraq’s giant Rumaila oilfield is set to invest $1.7B next year in a drive to increase production by 50% at the project to 2.1M bbl/day by the end of the decade.
- The figure represents an increase of 800K bbl/day from current production and will account for 3% of global oil production, according to BP’s Energy Outlook 2035.
- The agreement was made under a recently revised technical service contract that extended the partnership to 2034; Rumaila in September reached accumulated production of 2B bbl under the contract, which was initially signed in 2009.
- Citing stronger-than-expected iPhone/iPad accessory sales, ZAGG now expects 2014 revenue of $250M-$255M, above a $232.5M consensus. The outlook implies Q4 revenue of $91.8M-$96.8M, far above a $73.3M consensus.
- In addition, thanks to a mix shift towards high-margin screen protector sales, gross margin is now expected to be in the low-30s, better than prior guidance for the high-20s. Adjusted EBITDA guidance has been hiked to $30M-$32M from $15M-$20.
- Shares have recovered a big chunk of the losses they saw on Nov. 5 thanks to Zagg's Q3 EPS miss and soft gross margin/EBITDA guidance.
- Boeing (NYSE:BA) will deliver a record 754 commercial aircraft in 2015, an Y/Y increase of up to 5.5%, according to a forecast from the U.S. Aerospace Industries Association which is in-line with Boeing's current production plans and reflects expectations of steadily rising production.
- The trade group forecast comes amid concern that Boeing may have to cut production of some models to keep the assembly lines from running out of orders.
- The AIA also predicts a 6% rise in overall U.S. civil aircraft sales in 2015, which would be slower than the 8% increase in 2014.
- Carl Icahn has upped his Hertz (NYSE:HTZ) stake to 51.9M shares (good for an 11.34% stake), per a new 13-D.
- Icahn is less than a month removed from disclosing he increased his Hertz stake to 49.3M shares from a prior 38.8M.
- The car rental giant remains below where it traded before Icahn first reported a stake on Aug. 20.
- At today's closing price, $50M would be good for nearly 11% of the float. Dynex (NYSE:DX) says it will only repurchase shares when the price of the stock is less than the company's most recent estimate of book value.
- As of Sept. 30, book value was $9.14, putting today's close at nearly an 8% discount to book.
- Source: Press Release
- Corning (NYSE:GLW) and Dow Chemical (NYSE:DOW) disclose their 50/50 Dow Corning JV is shutting down its Hemlock Semiconductor facility in Clarksville, TN, which makes polysilicon for solar cells and semiconductors. (8-Ks: Corning, Dow)
- The decision was made after a "review of sustained adverse market conditions and continued oversupply, the cost of operating the facility and the ongoing impact of tariffs on polycrystalline silicon imported into China." A $1.5B-$1.6B pre-tax charge will be taken.
- At the same time, Dow Corning has cut its estimate for the company's future liability related to its 1998 breast implant settlement by $1.3B; the liability stood at $1.7B at the end of Q3.
- Corning and Dow Chemical each expect to see a $500M post-tax hit from the closing of the Hemlock plant, and a $400M post-tax benefit from the liability estimate cut.
- GLW +0.9% AH.
- Marathon Oil (NYSE:MRO) says it expects a 2015 capital spending budget of $4.3B-$4.5B, or ~20% below 2014 levels, adding that it needs extra time to finalize the budget given continuing changes in oil prices and the expected impact on oilfield service costs.
- MRO says the capital program will reflect a significant weighting to its high return investment opportunities in its U.S. resource plays and lower exploration spending, with total 2015 production growth (excluding Libya) anticipated in the high single digits.