Today - Friday, November 21, 2014
- Down 3% yesterday after posting mixed Q3 results and reiterating its full-year module shipment guidance, JinkoSolar (NYSE:JKS) is shooting higher today. Volume (2.8M shares) is already above a 3-month average of 2.1M.
- SA author The Panoramic View remains bullish, citing Jinko's industry-leading manufacturing costs, growing downstream solar ops (1.8GW pipeline, with 461MW of projects expected to be connected in Q4), and low forward P/E (5.2 going into today).
- Bill Veghte, put in charge of H-P's (HPQ +0.1%) enterprise hardware ops a year ago, will now "be part of a three-person team to plan HP Enterprise’s strategy and guide it through its separation," Bloomberg reports, citing in an internal memo. Enterprise services chief Mike Mefkens and software chief Robert Youngjohns are the other team members.
- Antonio Neri, GM of H-P's server and networking units, will take over Veghte's job, albeit while still reporting to him. Chris Hsu, H-P's SVP of operational performance, will be in charge of splitting H-P's enterprise ops, and business PC SVP Enrique Lores will be in charge of splitting its PC/printing ops.
- The move comes ahead of H-P's Nov. 25 FQ4 report. Shares +5% since the Oct. 6 split announcement. As previously announced, Meg Whitman will be the CEO of H-P Enterprise, and PC/printing EVP Dion Weisler the CEO of HP Inc.
1:10 PM| 3 Comments
- Maxim Group has launched coverage on Nimble Storage (NMBL -4.1%) with a Hold rating and $28 target. The launch comes ahead of Nimble's Nov. 25 FQ3 report, and three days after the company officially added Fibre Channel support to its CS-series arrays.
- Meanwhile, founder/CTO Umesh Maheshwari has disclosed he sold 32K shares on Tuesday and Wednesday, and marketing chief Daniel Leary has disclosed the sale of 17K shares on Tuesday. Maheshwari had already unloaded a large chunk of his Nimble holdings earlier this year.
- Believing Satya Nadella has done little to address core problems, Jefferies' John DiFucci (formerly with JPMorgan) has launched coverage on Microsoft (MSFT -1.5%) with an Underperform rating and $40 target, as part of a broader software stock launch. Shares have turned negative after opening higher.
- "We believe the 'new' Microsoft will look very much like the 'old' Microsoft for some time," says DiFucci in his note. He observes the majority of Microsoft's op. profit is still tied to PCs (ed: much of it isn't directly linked to PC sales, but to Office subscriptions/volume licenses), and sees Chromebooks and cheap tablets eating into Windows' computing share.
- Going into today, shares had risen 56% since Steve Ballmer announced his retirement plans in August 2013.
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- "The 50-50 situation isn't a long-term scheme," says Orange (NYSE:ORAN) CEO Stephane Richard about his company's Everything Everywhere U.K. mobile JV with Deutsche Telekom (OTCQX:DTEGY). He adds "all options are open," but cautions investors not to "expect anything spectacular in the short-term."
- Bloomberg reported in October Orange and Deutsche were open to an EE sale, while adding an IPO was still "the most likely outcome" for the JV.
- With price competition remaining fierce and rivals narrowing EE's 4G coverage lead, the carrier saw its subscriber base (still the U.K.'s largest) fall by 2% Y/Y in Q3 to 24.5M. Both EE and rivals are now investing in offering triple-play packages.
- Orange has rallied on a good day for European equities. France's CAC 40 index is up 2.7%.
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- Though weak baseband processor sales are weighing on Marvell (NASDAQ:MRVL) near-term, management "expects their mobile business to turn around starting in the April quarter, and for mobile unit shipments to double y/y in FY16," notes Stifel's Kevin Cassidy. He's reiterating a Buy, albeit while cutting his target by $2 to $16 and voicing some concerns about ASP/margin erosion.
- RBC is also staying bullish, predicting mobile sales will rebound next year and that Marvell's $1.54B Carnegie Mellon infringement verdict will ultimately be lowered. The firm has also cut its target, and so have Nomura and Deutsche, but no downgrades have arrived.
- On the CC (transcript), CEO Sehat Sutardja mentioned mobile sales fell 13% Q/Q in FQ3 due to customer mix (read: weak Samsung demand) and a "shift from the carrier-driven models to the open market in China, which required full turnkey [platform] support." Turnkey revenue is expected to arrive in FQ2 of next year.
- Networking chip sales fell 7% Q/Q due to weak carrier capex, but is expected to be flat in FQ4. Storage revenue rose 3%, with both hard drive and SSD controller revenue growing. Marvell says it remains the top SSD controller vendor, and will begin seeing revenue from mobile SSD offerings next year.
- A mix shift away from mobile contributed to Marvell's better-than-expected gross margin.
- FQ3 results, guidance/details.
- Twitter (TWTR +0.5%) CEO Dick Costolo's family trusts sold 283.5K shares (half their holdings) in transactions on Nov. 3 and 17. Following the sales, Costolo directly owns 36K Twitter shares and 283.5K via the trusts, along with 509.8K restricted stock units.
- Costolo previously sold 17K shares in July, and 20.1K in October. On Nov. 3, he disclosed entering into a 10b5-1 trading plan. Other Twitter execs sold share following the company's May lockup expiration.
- The WSJ ran a less-than-glowing column on Nov. 6 regarding Costolo's management style, and the investor pressure he's facing to boost user growth/engagement. A slew of product changes were unveiled the following week at Twitter's analyst day, as were aggressive growth targets.
- Chinese online real estate plays SouFun (SFUN +13.9%), E-House (EJ +10.9%), and Leju (LEJU +12.1%) are responding quite well to the PBOC's decision to respectively cut its benchmark lending rates and one-year deposit rate by 40 bps and 25 bps. The Shanghai exchange saw a 1.4% rally overnight.
- All three companies had sold off this week in response to E-House/Leju's soft Q3 numbers and full-year guidance cuts.
- The NY Post reports Amazon (AMZN +1.7%) will launch an ad-supported video service next year that won't require a Prime subscription. "The main point is to bring in more users that you can eventually up-sell to Prime, or to get to a broader audience that doesn’t want to pay for Prime," says a source.
- The WSJ reported in March Amazon was prepping a free/ad-supported streaming service, but Amazon quickly denied it had plans to do so. The Post's sources state roughly half of Amazon's Prime subscriber base (recently estimated by RBC to total 40M-50M) uses Prime Instant Video.
- Netflix (NFLX -0.7%) is off slightly on a morning the Nasdaq is up 0.7%. The company (37M U.S. subs, 53M globally) has long been contending with ad-supported streaming services from Hulu and others.
- Yesterday: Amazon reportedly prepping travel service
- Update: An Amazon spokeswoman says the company hasn't "announced any plans" for an ad-supported services, but adds it's "often experimenting with new offers and experiences for customers."
- Chinese regulators have granted Youku (YOKU +2.5%) a license to provide mobile services as an MVNO. A reseller deal has been reached with #2 local carrier China Unicom (CHU +3.7%).
- Youku asserts becoming an MVNO will allow it to "add more customer behavioral data to its existing big data of users' content consumption behavior, and expand its reach beyond its current mix of customers as an online video service provider."
- Youku now gets over 60% of its video traffic from mobile. However, mobile's share of ad revenue is still only about half that figure.
- Youku and Unicom have joined many other Chinese companies in opening sharply higher.
- Alibaba (NYSE:BABA) is offering $300M of floating rate notes due 2017, $1B of 1.625% notes due 2017, $2.25B of 2.5% notes due 2019, $1.5B of 3.125% notes due 2021, $2.25B of 3.6% notes due 2024, and $700M of 4.5% notes due 2034.
- Issue prices per note range from 100% for the floating rate notes to 99.439% for the 2034 notes. The offering is expected to close on Nov. 28.
- Shares +2.7% premarket, aided by higher equity futures.
- Yesterday: Alibaba reportedly launches offering, sees huge demand
9:10 AM| Comment!
- Telecom Italia (NYSE:TI) will likely sell the mobile phone towers of its Brazilian unit TIM Participacoes (NYSE:TSU) to American Tower (NYSE:AMT) for almost €900M ($1.1B), says Reuters quoting two sources.
- Yesterday, Telecom Italia was reported to be weighing a deal between TIM and Brazil's Oi (NYSE:OIBR), saying it would ask its board for support today to "explore a potential transaction".
- Previously: Oi, PT rally; Telecom Italia reportedly weighing deal