Today - Tuesday, May 5, 2015
2:56 PM| Comment!
- Chinese heavyweight automakers Dongfeng (OTCPK:DNFGY, OTCPK:DNFGF) and FAW Group are reported to be in talks on a merger.
- Both companies have fallen under the eyes of the government amid President Xi Jinping's effort to reel in corruption.
- A combination of the two automakers would create the 6th largest car manufacturer globally.
- Fomento Económico Mexicano (NYSE:FMX) confirms it has asked for government authorization to sell alcoholic beverages in a small retail format in Texas.
- The company says it will invest $850M to open 900 stores in the state if regulators clear the plan.
- The development coincides with Wal-Mart also trying to get clearance to sell alcohol in Texas which has restrictive policies for publicly-traded companies in the beverage category.
- Costco (NASDAQ:COST) is a step ahead by partnering with Texas-owned WB Liquors, but is also pushing the state for reform.
- Kroger (NYSE:KR) has also reportedly been making noise about selling liquor in its Texas outlets.
- Previously: Wal-Mart pushes for right to sell alcohol in Lone Star State (Apr. 27 2015)
- Macy's (M -0.9%) plans to open four discount stores around New York City this fall in a test of a new retail concept.
- The company, which tipped off in the past it would consider launching a discount brand, spent about six months developing Macy's Backstage.
- The off-price stores will be about 30K square feet in size.
- A larger roll-out could provide new competition for the T.J. Maxx and Marshalls chains from TJX Companies (TJX -0.4%).
11:08 AM| Comment!
- Mattress Firm (MFRM -2.5%) trades lower after Piper Jaffray downgrades the stock to a Neutral rating after having it slotted previously at Overweight.
- Piper sets a price target of $62 on MFRM.
- Yesterday, Mattress Firm disclosed that CEO Stephen Stagner peeled off a minor amount of shares.
- SEC Form 4
- Nautilus (NLS +20.6%) pops after blasting past estimates with its Q1 report.
- The company saw a big jump in margins on a favorable shift in product mix.
- Operating expenses were up 23% to $36.284M to trail the 34% top-line growth.
- Direct-to-consumer sales of the Bowflex Max Trainer were strong during the quarter.
- Previously: Nautilus beats by $0.10, beats on revenue (May. 04 2015)
- Adidas (OTCQX:ADDYY, OTCPK:ADDDF) reports sales rose 9% to €4.083B ($4.556B) in Q1 on a currency-neutral basis.
- Sales in Europe +11% to €1.143B ($1.276B).
- Sales in North America +7% to €591M ($659.6M).
- China was a bigger contributor during the quarter with the region seeing sales growth of 21% to €597M ($666.45M).
- Reebok sale were up 9% as training and studio products showed strong demand.
- Net profit came in at 221M ($246M) vs. €234M consensus estimate.
- Adidas earnings press release (.pdf)
- Texas Roadhouse (TXRH +4.9%) trades higher after a narrow EPS beat with its Q1 report.
- The company delivered an 8.9% increase in comparable-store sales at company restaurants and an 8.0% gain at franchised outlets.
- Sales volume helped reduce the impact of commodity inflation, although the restaurant margin rate was still down 20 bps Y/Y to 19.0%.
- Texas Roadhouse expects to open 25 to 30 restaurants this year.
- RevPAR increased 3.8% at Hyatt's (H -1.3%) company-owned and leased hotels in Q1.
- Systemwide RevPAR was up 4.6% (7.4% ex-currency), led by a strong 8.4% rise for U.S. full service hotels.
- The lift in sales helped the company boost margin rates in the quarter.
- Property count +12 Q/Q to 599.
- The company's net income dropped year-over-year due in part to reduced gains from real estate sales.
- Previously: Hyatt Hotels misses by $0.08, beats on revenue
- KapStone Paper and Packaging KS acquires Victory Packaging for $615M in cash.
- The deal terms call for payouts of another $45M if certain terms are met over the next four years.
- The company says a $100M tax benefit associated with the acquisition will lower the net purchase price to $515M.
- Previously: KapStone misses by $0.11, misses on revenue
- Previously: Volume down in Q1 for KapStone Paper and Packaging
- Jefferies jumps into the coverage universe on Tesla Motors (TSLA +2.6%) with a Buy rating and $350 price target.
- The investment firm is taking a long view on the company's potential in China, despite a stuttering start in the region by Tesla.
- A consumer survey leaned on by Jefferies indicates that it's "feasible" for Tesla to sell 500K cars a year by 2020 and dismisses the impact of a possible entry by Google or Apple into the EV segment.
- The 500K cars a year by 2020 forecast was also pushed out by Panasonic CEO Joe Taylor at CES this year and has been alluded to by Tesla CEO Elon Musk.
- Jefferies talks batteries: "The company's relentless drive to improve battery energy storage capacity (car range is 3x the typical BEV), longevity, power delivery and performance while lowering cost per kilowatt-hour (the Gigafactory should reduce battery pack cost/kWh by ~30%) results in a key competitive advantage that helps TSLA."
- KapStone Paper and Packaging (NYSE:KS) reports volume fell 1.8% to 661K tons of paper sold.
- The average selling price during the quarter was down $2 to $683 per ton.
- Adjusted EBITDA margin -160 bps to 15.8%.
- Guidance: "I expect to see our operations perform better in the second quarter," stated CEO Roger Stone.
- Previously: KapStone misses by $0.11, misses on revenue
- KS -0.1% premarket.
9:13 AM| Comment!
- Avon Products (NYSE:AVP) is having a hard time landing bids for its North American business or the company itself, reports New York Post.
- Sources tip logical suitor Coty (NYSE:COTY) is more interested in buying the CoverGirl and Max Factor brands from Procter & Gamble (NYSE:PG).
- Procter & Gamble is in the middle of a broad brand-shedding program.
- Shares of Coty are up 19.8% YTD compared to the 13% drop in Avon.
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