Seeking Alpha
  • Today - Thursday, November 27, 2014

  • 3:56 PM
  • 1:27 PM
    • Monitise (OTCPK:MONIF) gets a £49.2M investment from strategic partners Telefonica (NYSE:TEF), Santander (NYSE:SAN) and Mastercard (NYSE:MA).
    • They will buy 161M ordinary shares at 30.5p/share (Nov. 26's close), representing 8.2% of the existing issued ordinary share capital.
    • Monitise also says it's in discussions to expand its commercial relationships with above partners "to support the development and accelerated rollout of its global platform capabilities."
    • IBM has agreed to deploy Watson in support of Monitise’s new technology platform.
    • Monitise also reiterates current year and longer-term guidance.
    • Short interest is ~11% of float.
    • Monitise was best performer on FTSE AIM 100 index today.
    • Source: press release
    | 2 Comments
  • 12:11 PM
    • CEO Nick Hayek (OTCPK:SWGAY) says it's Apple (NASDAQ:AAPL) that's under pressure, not the Swiss watch industry.
    • Apple's watch is "not yet ready for mass production," and that this "would not have happened under Steve Jobs."
    • Smart-watches "won't revolutionize" the watch industry, he says, any more than clock-equipped smartphones did.
    • Hayek thinks the Apple Watch could spur business, because many customers will opt to buy normal watches instead.
    • Source: Handelsblatt
    | 50 Comments
  • 7:52 AM
    • European Parliament lawmakers overwhelmingly voted in favor of a resolution urging antitrust regulators to consider splitting Internet search engines, such as Google (NASDAQ:GOOG), from other commercial services.
    • The controversial initiative will have no binding power over the European Commission, the bloc’s top antitrust regulator, but proponents of the measure hope it will add pressure.
    | 16 Comments
  • 5:31 AM
    • Renewing its push into the Internet TV market, Alibaba (NYSE:BABA) and partner Haier Electronics (OTCPK:HRELY) have launched new TVs in China that provide users with access to the e-commerce company’s Taobao and Tmall online marketplaces as well as movies and video games.
    • Last year, Alibaba launched a smart TV with Chinese TV manufacturer Skyworth (OTCPK:SWDHY), but the product failed quickly because its online entertainment offerings were limited.
    | 3 Comments
  • Wednesday, November 26, 2014

  • 6:58 PM
    • Pivotal, which EMC and VMware (NYSE:VMW) spun off from their core ops in late 2012, is laying off 60 employees, sources tell CRN. The company reportedly has 1,800 workers.
    • Though EMC announced IPO plans for Pivotal back in March 2013, no offering appears to be on the horizon for now. The company's product line is headlined by its Greenplum analytics database and Cloud Foundry app platform (PaaS); each faces plenty of competition. A Big Data Suite featuring Greenplum and several other analytics-focused products was launched in April.
    • Pivotal had Q3 revenue of $58M (+23% Y/Y), and an op. loss of $52M. GE paid $105M last year to buy a 10% stake.
    | Comment!
  • 6:25 PM
    • Though Samsung "has taken the majority of Apple's iPhone chip orders for 2015," TSMC (NYSE:TSM) is believed to have landed all of the iPad-related orders for Apple's next-gen A9 processor, and is set to receive a combined 40%-50% of iPhone/iPad A9 orders, Digitimes reports.
    • In December, TSMC will reportedly begin taping out A9 processors that leverage its next-gen 16nm FinFET manufacturing process. Samsung, however, is said to have won orders by offering aggressive prices for its 14nm FinFET process (previous). TSMC expects to begin 16nm mass-production in Q2 2015.
    • The Korea Times reported last week Samsung will handle 80% of A-series processor output starting in 2016. TSMC is currently manufacturing the A8, and has received a huge top-line boost from doing so.
    | Comment!
  • 6:02 PM
    • Sony (NYSE:SNE) is prepping a smartwatch whose "face and wrist band will be made from a patented material that allows the entire surface area to function as a display and change its appearance," Bloomberg reports. The product could arrive as soon as next year.
    • Aside from providing more usable surface area, an e-paper smartwatch might also be less power-hungry than rival offerings using LCDs or OLEDs. The product is reportedly being developed by a new business unit created by CEO Kazuo Hirai to fast-track promising ideas (previous).
    • Sony's existing SmartWatch 3 (launched in September) features a 1.6" LCD, and (like many rival offerings) runs on Google's Android Wear platform. All signs suggest initial sales have been limited. The Apple Watch is expected to begin shipping in early 2015.
    | Comment!
  • 5:33 PM
    • After being prodded by the FCC on the issue, AT&T (NYSE:T) insists CEO Randall Stephenson's Nov. 12 remarks about halting fiber investments until neutrality rules are set only applied to new investments rather than ones already planned.
    • Stephenson's remarks - "We can't go out and invest that kind of money deploying fiber to 100 cities not knowing under what rules those investments will be governed." - appeared to refer to AT&T's April announcement about bringing its U-verse GigaPower service to up to 100 cities in 21 metro areas, depending on local support. AT&T now says that plan is still on track.
    • The original remarks came two days after Pres. Obama backed tough neutrality rules, and five days after AT&T announced it would be spending ~14% less on capex in 2015 than it would in 2014.
    | 23 Comments
  • 4:08 PM
    • Melvyn Morris, KING Digital's chairman since 2003, has "stepped down from the role of Chairman of the Board and will take a leave of absence from the Board for personal reasons."
    • Director Gerhard Florin, formerly an exec at Electronic Arts and BMG, is King's new chairman.
    | Comment!
  • 4:02 PM
    • SemiLEDs (NASDAQ:LEDS): FQ4 EPS of -$0.17
    • Revenue of $2.27M (-32.8% Y/Y).
    • Press Release
    | Comment!
  • 4:00 PM
    • Shanda Interactive has sold 48.8M Shanda Games (GAME -0.2%) Class B shares to a company controlled by acting CEO Yingfeng Zhang, and an equal number of shares to an affiliate of Hong Kong-based Ningxia.
    • Following the sale, Ningxia owns 24.1% of GAME's Class A and B shares, and 40.1% of its voting rights. Zhang's company respectively owns 9.1% and 34.5%. Shanda Interactive "no longer beneficially owns any ordinary shares of the Company."
    • Shanda Interactive doesn't intend to remain a member of the consortium that has offered $1.9B ($6.90/ADS) to buy Shanda Games. However, Ningxia and Zhang remain a part of it.
    • GAME also announces Zhang is now the company's chairman. He replaces Shanda Interactive co-founder Tianqiao Chen, who is leaving the board. Ningxia chairman Shengming Ma is joining the board.
    | Comment!
  • 2:52 PM
    • Chip stocks are outperforming after Analog Devices (ADI +5.2%) beat FQ4 estimates and offered in-line FQ1 guidance. The Philadelphia Semi Index (SOXX +1.9%) has made new highs.
    • Notable gainers include many analog/mixed-signal and telecom IC firms: TXN +3%. LLTC +2.7%. SMTC +3.1%. ISIL +3.3%. SWKS +3.7%. AVGO +2.9%. OVTI +3.2%. FSL +3.1%. EZCH +2.5%. XLNX +2.3%. ALTR +2.1%. MX +4.3%. PMCS +2.7%. BRCM +2%.
    • On its CC (transcript), ADI noted its telecom equipment chip sales are holding up well in spite of weak capex, aided by the fact its dollar content for 4G base stations is "at least 20% to 30% better" than for 3G base stations. The company also mentioned its lead times were stable in FQ4.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | 3 Comments
  • 2:24 PM
    • UniPixel (NASDAQ:UNXL) is rallying ahead of a Dec. 4 analyst day (co-hosted with Kodak) where it will show off its InTouch manufacturing process, whose full commercialization has been repeatedly delayed. 138K shares have changed hands vs. a 3-month average of 108K.
    • Many shorts have taken profits in recent months: While 2.4M shares (22% of the float) remained shorted as of Nov. 14, that figure is down sharply from 4.5M as of June 30, and 6.3M as of Nov. 15, 2013.
    | 10 Comments
  • 2:08 PM
    • On top of providing light Q4 sales guidance, Ctrip (NASDAQ:CTRP) guided on its CC (transcript) for a Q4 op. margin of -12% to 17%, down sharply from Q3's 11% and Q4 2013's 20%. Gross margin is expected to account for 3% of the Y/Y drop, sales/marketing spend 12%, R&D 18%, and G&A 2%.
    • The outlook has led Barclays, UBS, and Raymond James to downgrade the Chinese online travel leader to neutral ratings. Several other firms have slashed their targets.
    • Piper (Neutral, PT cut to $49): "Management reiterated expectations of 20%-30% PF op margins long-term, but visibility on multi-year margin trajectory is low due to increasing competition. Furthermore, beyond Q4, the company suggested that Q1 PF op margin may be flattish q/q and 2015 PF op margin may be similar to 2014 (low to mid single digits)."
    • Goldman (Neutral, PT cut to $59) likes Ctrip's mobile metrics - mobile was respectively 45% and 35% of hotel and air ticket volume - and notes Ctrip's open platform now claims 1K+ hotel agency partners and 800+ local travel agencies.  But it also expects spending on R&D, rebates (due to price competition), branding, and product coverage expansion to remain heavy.
    • Rivals Qunar (QUNR -2.2%) and eLong (LONG -2.4%) are following Ctrip lower.
    | 1 Comment
  • 1:48 PM
    • Bloomberg reports Amazon (AMZN -0.5%) has finished internal talks to buy top Indian online fashion retailer Jabong. VCCircle reports Amazon has "completed its first level of talks" to buy Jabong, and that the deal could be worth $1.1B-$1.2B.
    • Jabong had a 1H14 GMV of INR5.1B ($82.9M) courtesy of 3.2M orders, up 3x Y/Y. The company is backed by German e-commerce VC firm/incubator Rocket Internet.
    • Indian restrictions on retail foreign investment could stand in Amazon's way. However, the new government is reportedly open to loosening e-commerce-related restrictions.
    • Amazon committed to investing $2B in India earlier this year, where it faces off against local giant Flipkart and eBay-backed marketplace Snapdeal. Alibaba just stated it plans to expand its Indian presence.
    | 2 Comments
  • 12:58 PM
    • Facebook (FB +2.1%) and Twitter (TWTR +2.6%) are rallying on a sleepy pre-Thanksgiving trading day. The companies have respectively seen 21.9M and 16.1M shares traded thus far vs. 3-month averages of 38.3M and 28.1M.
    • Several other Internet stocks (both U.S. and Chinese) are also moving higher. Z +2.3%. TRLA +3%. BITA +5.1%. EJ +6.7%. SFUN +2.6%. VIPS +3.3%. SOHU +2.9%.
    • Facebook is at its highest levels since selling off in late October due to its Q4 revenue and 2015 spending guidance.
    | 8 Comments
  • 12:39 PM
    • Down yesterday after a grand jury declined to indict Darren Wilson for the shooting of Michael Brown, Digital Ally (NASDAQ:DGLY) is rallying today as protests over the decision continue.
    • Benjamin Crump, the attorney for Brown's family, is among those calling for police officers to wear body cameras. "We won’t have to play this game of witnesses’ memories and secret grand jury procedures ... It would just be transparent, and we could see it ourselves." A 2013 survey found 25% of polled police officers already used body cameras.
    • DGLY is up over 4x since protests first erupted in mid-August.
    | 2 Comments
  • 12:13 PM
    • GoPro (GPRO +3.7%) "plans to start selling multi-rotor helicopters equipped with high-definition cameras late next year, aiming for a price tag between $500 and $1,000," sources tell the WSJ.
    • As it is, GoPro's cameras are often mounted onto drones sold by third parties. The report comes as a top consumer drone maker, China's DJI, begins selling drones featuring its own cameras instead of GoPro's.
    • A drone product launch would mesh with GoPro's ambitious online video efforts: Though the consumer drone market is still in its infancy, YouTube is already full of popular videos of drone footage.
    • GoPro has spiked following the report, adding to the gains it saw today thanks to Piper's note.
    | 21 Comments
  • 11:55 AM
    • ZAYO has received 11 bullish ratings on underwriter coverage day, and no neutral or bearish ones.
    • Goldman (Buy, $30 target) calls the fiber network owner "a pure-play opportunity on 20%+ secular growth in data traffic expected over the next few years," and thinks the market for fiber infrastructure service can post a 7% CAGR through 2020. "Our [sum-of-the-parts] analysis suggests the market is giving little credit to revenue visibility and incremental margins of the physical infrastructure business."
    • "Zayo owns one of the largest collections of fiber in the U.S. and primarily targets customers with heavy and complex bandwidth needs," says Morgan Stanley. "Consolidated adjusted EBITDA margins for Zayo are ~58%, meaningfully higher than its peers due to its focus on the higher margin products like dark fiber (~70% margins) ... Even if individual product margins remain flat, consolidated margins can grow due to a mix shift."
    • MS also observes the fiber services market has seen huge consolidation, and that mobile, cloud, and online video traffic growth is boosting demand.
    • Zayo now +39% from October's $19 IPO price. Peers Level 3 (LVLT +1%) and Cogent (CCOI +1.8%), for whom many of the bullish arguments for Zayo also apply, are trading higher.
    | 1 Comment
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