Seeking Alpha
  • Wednesday, October 1, 2014

  • 7:04 PM
    • With carriers turning cautious amid slowing subscriber growth and intense price pressure, R$5.8B ($2.4B) was spent during a closely-watched auction for Brazilian 4G spectrum, far less than the R$8B the government was hoping to raise.
    • America Movil (NYSE:AMX) bought a chunk of the airwaves, as did Telefonica's (NYSE:TEF) Vivo (NYSE:VIV) and Telecom Italia's (NYSE:TI) TIM Participacoes (NYSE:TSU). Oi (NYSE:OIBR), looking to strengthen its balance sheet follow the Portugal Telecom deal, decided to pass.
    • All 4 carriers have been the subject of M&A intrigue in recent months. Oi has reportedly been looking to merge with TIM, while TI is believed to have mulled a takeover of Oi. AMX says it's interested in partnering with Oi on a bid for TIM, and Telefonica has struck a deal to buy Brazilian wireline carrier GVT.
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  • 6:39 PM
    • Waters Corp. (WAT -0.7%) will report Q3 results on October 21 before the open. The conference call will begin at 8:30 am ET.
    • Consensus view is EPS of $1.29 on revenues of $487M.
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  • 6:15 PM
    • Windstream (NASDAQ:WIN) has bought Business Only Broadband, a provider of fixed wireless broadband services in Chicago, NYC, North Jersey, and Milwaukee. Terms are undisclosed.
    • The company plans to "expand the Business Only Broadband network into additional markets beginning in 2015." A map of Windstream's fiber network shows plenty of potential locations.
    • Windstream's business revenue rose fractionally Y/Y in Q2 to $749M, as voice customer losses offset data growth.
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  • 6:00 PM
    • Digital Ally's (NASDAQ:DGLY) shelf filing allows Hudson Bay Capital to sell up to 1.19M shares. The shares are tied to an August private placement in which both convertible notes (due 2016) and a common stock purchase warrant were issued to Hudson Bay.
    • Though down 57% from a Sep. 2 high of $33.59, DGLY remains well above where it traded at the time of the private placement.
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  • 5:31 PM
    • Liquidity Services (NASDAQ:LQDT) is cutting 130 full-time and temporary jobs on account of "the new terms and scope" of its DoD surplus auction contract. The company has ~1,300 full-time employees. (PR)
    • Liquidity lost the DoD's rolling stock surplus contract this spring. It held onto the non-rolling stock contract, but at terms that disappointed investors.
    • The company is also launching a "transformation plan" said to focus on "the priorities and areas which we believe will deliver profitable, sustainable growth."
    • As part of the overhaul, Capital Assets Group chief Tom Burton has been moved over to the new position of EVP, Federal Sector, and Roger Gravley is replacing Bob Debardelaben as head of the GovDeals unit. Liquidity exec Gardner Dudley is the new Capital Assets Group chief.
    | 1 Comment
  • 5:12 PM
    • The multi-year deal with the NFL is said to expand DirecTV's (NASDAQ:DTV) "exclusive rights to carry NFL Sunday Ticket and its package of every Sunday afternoon out-of-market game."
    • It also expands DirecTV's rights to stream Sunday Ticket games on the Web and mobile devices, and gives DirecTV subs online access to NFL Network streams.
    • Deal terms are undisclosed. Sports Business Daily previously reported DirecTV would be paying $1.3B-$1.4B/year, up from the $1B/year it currently pays.
    • DirecTV is up 1.9% AH. Acquirer AT&T (NYSE:T) is up 0.4%. AT&T had the right to walk away from the DirecTV deal if Sunday Ticket wasn't renewed.
    • Update: Re/code reports the new deal is good for 8 years.
  • 5:01 PM
    • Apple (NASDAQ:AAPL) has been granted its motion for summary judgment on invalidity and non-infringement in its patent battle against Wi-Lan (NASDAQ:WILN). The motion covers two 4G Wi-Lan patents asserted against Apple.
    • Wi-Lan says it's "reviewing the ruling" with its law firm. The company also notes it has a second suit against Apple, through which it's alleging the infringement of 5 4G patents.
    • A number of other patent licensing firms have also received adverse rulings in recent months.
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  • 4:38 PM
    • Enterprise cloud storage/file-syncing leader BOX's IPO "probably won’t happen until 2015 because of volatile market conditions," Bloomberg reports. Box filed a public S-1 back in March, and was once expected to go public by this summer (if not sooner).
    • Market volatility, of course, didn't stop Alibaba from recently doing a blockbuster IPO. Box has been looking to soothe investor concerns about the cash burn caused by its heavy sales/marketing spend (still larger than revenue as of the 3 months ending April 30).
    • Box raised $150M in July at a $2.4B valuation. The funds extended the company's IPO runway. Since then, Amazon has launched a competing service, and Microsoft has aggressively slashed prices for its offerings.
    | 1 Comment
  • 4:30 PM
    • EMC has hired Zane Rowe, who has done stints as United Continental's CFO and Apple's North American sales chief, to be its CFO.
    • Rowe's predecessor, David Goulden, was named the head of EMC's core storage hardware/software ops in January. Goulden is now viewed as a potential successor to CEO Joe Tucci, if not the frontrunner.
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  • 4:13 PM
    • TrueCar (TRUE +2.5%) has rallied on a weak day for equities after top automakers generally posted healthy September sales figures, aided by strong truck demand. Autodata believes U.S. car/truck sales rose 9% Y/Y to 1.2M.
    • For its part, TrueCar estimates the average transaction price for U.S. light vehicle sales fell 1.9% M/M and 1.4% Y/Y to $31,014. Industry incentive spend per vehicle is estimated to have totaled $2,801, down 6.2% M/M but up 13.1% Y/Y.
    • "The industry is operating within healthy post-recession levels," says TrueCar exec Larry Dominique. "We'll be watching incentive levels for unhealthy behavior as brands look to steal some year-end market share."
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  • 4:08 PM
    • Wi-LAN (NASDAQ:WILN) has been waging an infringement suit against Apple. Apple has requested a summary judgment clearing it of infringement.
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  • 2:53 PM
    • Stephane Richard, the CEO of giant French telco Orange (ORAN -2.6%), has confirmed to Le Monde Orange will offer Netflix's (NFLX -2.8%) services to pay-TV clients through its set-tops. "The negotiations were tough but are finished. There is no reason to penalize Orange customers, who will have a much better experience using Netflix through the box."
    • Orange had 5.78M French TV subs at the end of Q2. Netflix launched in France (and several other European markets) last month, and has already struck a deal with Orange rival Bouygues.
    • European pay-TV providers have generally been more willing to partner with Netflix than their American peers, who often view the company as a threat.
    | 1 Comment
  • 2:38 PM
    • Ericsson (ERIC -1%) has bought Ambient, a smart grid networking tech provider that recently filed for Chap. 11. Ericsson had previously submitted a $7.5M stalking-horse bid.
    • Ambient's platform features hardware and software that allows utilities to run multiple smart grids in parallel, and to do so using a variety of telecom technologies (inc. cellular and Wi-Fi, which Ericsson has plenty of experience with).
    • Ambient also has a sizable smart grid patent portfolio, and offers various consulting/installation services. Ericsson client Verizon is a mobile network partner. Silver Spring (SSNI -4.7%) is among Ambient's rivals.
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  • 2:07 PM
    • Major Chinese software vendor Kingsoft has begun using Seagate's (STX -3.5%) Nytro PCIe server flash cards to speed up the performance of its numerous cloud services. Seagate states Kingsoft "benchmarked [Nytro] with other comparable PCIe offerings and found that the response time performance with Nytro was significantly better."
    • The Nytro line was obtained through Seagate's purchase of LSI/Avago's flash storage product unit; it competes against offerings from SanDisk/Fusion-io (the market leader), Western Digital, and Intel, among others. Many Web/cloud services firms have embraced PCIe cards due to their fast response times (crucial for cloud apps).
    • Seagate is counting on both the LSI/Avago products and its SSD lineup to neutralize the enterprise/data center share gains seen by flash storage at the expense of hard drives. The fact Seagate isn't able to source NAND flash at cost (unlike SanDisk, Toshiba, Samsung, Micron, and Intel) remains a challenge.
    • Like many other tech names, Seagate is selling off today.
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  • 1:20 PM
    • Volatile and heavily-shorted 3D printing names are among the bigger decliners as the Nasdaq posts a 1.4% drop. Volumes for several names are already near or above their 3-month daily averages.
    • ExOne (XONE -10.6%) has tumbled to a fresh post-IPO low, and Voxeljet (VJET -3%) is close to its post-IPO low of $12.85. Also selling off: DDD -4.5%. SSYS -5.2%. CAMT -8.7%. ONVO -3.8%. OTCPK:AMAVF -5.9%.
  • 1:11 PM
    • A JV between SunEdison's (SUNE -2%) semiconductor materials unit (SEMI +0.3%) unit and Samsung has begun producing polysilicon using technology SunEdison promises will deliver "the lowest cost in the world."
    • The technology, known as HP-FBR, is said to "produces high purity polysilicon 10 times more efficiently and with 90% less energy used than non-FBR technologies."
    • SunEdison predicts it will allow the cost of the polysilicon needed for panel production to fall to "less than $0.05 per watt peak by 2016," and will let the company "deliver a 400-watt peak solar panel at a cost of $0.40 per watt peak by 2016."
    • Separately, SunEdison has announced the closing of $50M in debt financing for a 23.8MW Jordanian solar project expected to see construction start in Q4. The deal follows SunEdison's confidential IPO filing for an Asian/African solar project YieldCo.
    | 1 Comment
  • 12:46 PM
    • Globalstar (NYSEMKT:GSAT) has tumbled amid rumors Kerrisdale Capital is about to disclose a short position.
    • Kerrisdale has a long history of sparking selloffs with bearish columns.
  • 12:34 PM
    • Jeff White, formerly a Cisco exec holding dual management roles, has been named Extreme Networks' (EXTR +0.2%) chief revenue officer. That puts him in charge of the company's sales/marketing ops.
    • At Cisco, White was in charge of sales and financial operations for an Indian unit with $1B/year in sales. He was also responsible for "an 11,000-person organization spread across the functions of engineering, services, marketing and operations."
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  • 12:21 PM
    • Jason Kelly, most recently the CEO of e-commerce ad sales firm Sociomatic, has been named the president of Millennial (NYSE:MM) Managed Media business. That puts him in charge of the struggling mobile ad network owner's "global brand and performance sales teams."
    • Kelly has also held senior sales roles at Time, Virgin America, and Google-acquired Admeld. His hiring follows the departure of sales EVP Mollie Spilman to Criteo, and comes on the heels of Millennial's deal to purchase programmatic mobile ad tech provider Nexage.
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  • 12:03 PM
    • In an article embargoed until 5AM ET Thursday, Jeremy Raper predicts LookSmart (NASDAQ:LOOK) will run out of cash in a quarter or two, given it only has $2.65M, is burning ~$2M/quarter, and likely has no access to capital markets.
    • Raper adds the search/social media ad services firm is competing with the likes of Facebook, Oracle, and Salesforce for new business, and declares Monday's 50% jump (on no news) provides "an excellent entrypoint" for shorts. He notes borrowing costs (1-2%) remain low.
    | 1 Comment
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