Seeking Alpha
  • Today - Thursday, October 2, 2014

  • 10:47 AM
    • GoPro (NASDAQ:GPRO) founders Nicholas and Jill Woodman have gifted 5.8M shares to a "charitable organization" under their names. Lead IPO underwriter JPMorgan has agreed to release the lockup restrictions on the organization's shares.
    • The Woodmans sold over 5M GoPro shares through the IPO. They still held 50.8M shares post-IPO, good for a 47.4% stake.
    | Comment!
  • 10:33 AM
    • Just a week after launching coverage at Hold, Topeka's Victor Anthony has upgraded Pandora (P +1.4%) to Buy.
    • Anthony observes shares have fallen 9% since last week's coverage launch, and 43% from their March high. "The pullback creates a favorable risk-reward scenario, with 62% upside to our bull case model vs. 35% downside to our bear case model."
    • Shares are moderately higher. Albert Fried, previously quite bearish on Pandora, upgraded shares to Market Perform on Tuesday.
    | 2 Comments
  • 10:29 AM
    • After pricing its 11M-share IPO at $29 (above a $25-$28 range), Wayfair (NYSE:W) has opened at $36.00 and is now at $36.89, up 27%.
    • The online furniture kingpin is worth $3.05B, or 3.3x 2013 sales. Wayfair had 1H14 revenue of $574.1M (+50% Y/Y), and a net loss of $63.2M. Direct retail active customers totaled 2.6M at the end of June.
    • Prospectus, IPO preview, analysis
    | 1 Comment
  • 10:11 AM
    • Aixtron (NASDAQ:AIXG) is selling off after LED component/lighting giant Cree warned its Sep. quarter revenue will miss guidance due to weak component sales.
    • Aixtron soared last week after announcing a major Chinese LED equipment order, and subsequently catching a Morgan Stanley upgrade.
    | Comment!
  • 10:07 AM
    • BofA/Merrill's Krish Sankar has downgraded Enphase (NASDAQ:ENPH) to Neutral, albeit while hiking his target by $3 to $16.
    • Sankar likes the solar microinverter maker's management and products, but thinks it will be hard-pressed to maintain its dominant U.S. residential share without sacrificing margins.
    • He sees 2016 EPS of $1.00 in a best-case scenario, and thinks earnings could decline afterwards.
    • The downgrade follows a 128% YTD gain.
    | Comment!
  • 10:01 AM
    • Citi, Credit Suisse, Cowen, and Morgan Stanley have upgraded Autodesk (ADSK +4.1%) following its investor day. Shares are making fresh highs.
    • The main catalyst: Autodesk disclosed it will stop selling up-front licenses in 12-24 months to further migrate its base to cloud/subscription-based services. Adobe made a similar move last year (in part to combat piracy), and the results have been solid thus far. Autodesk had 1.94M subscribers at the end of July, and has guided for 200K-250K FY15 subscriber adds.
    • Credit Suisse, which has also upped its target by $20 to $70: "We believe that several significant changes to its business model will result in meaningful long-term upside to revenue (at limited incremental cost) and, therefore, operating profitability that is not reflected in consensus estimates or the stock's valuation."
    • Autodesk also guided for a 12% billings CAGR from FY14-18, and that its value/account and subscriptions would respectively rise 20% and 50% over this time. The company hopes to get over 70% of its revenue from recurring streams by FY18, and to grow its op. margin to 30%. FY15 op. margin guidance is at 15%-16%.
    • Investor day slides
    • Yesterday: Autodesk names CFO, reiterates FY15 guidance
    | Comment!
  • 9:38 AM
    • Qihoo's (QIHU +4.6%) buyback is good for repurchasing 2.5% of shares at current levels. It arrives with shares having fallen 49% from an all-time high of $124.42.
    • The company notes it had $787M in cash at the end of Q2 (to go with $600M in long-term debt), and has since raised $1B through a convertible offering.
    | Comment!
  • 9:32 AM
    • Kandi's (NASDAQ:KNDI) SMA7001BEV EV has passed inspections carried out by the city of Nanjing, and a subsidiary of ride-sharing firm ZZY (Kandi has a 9.5% indirect stake through its JV) has been cleared to create a Nanjing subsidiary.
    • The company notes its EVs are eligible to receive both a national subsidy of RMV47.5K ($7,738), and (in Nanjing) a subsidy of equal size from municipal and provincial authorities.
    • Kandi has already made efforts to support EV ride-sharing programs to Shanghai, Beijing, and Chengdu. Its first supported program launched in the city of Huangzhou last year.
    | 4 Comments
  • 9:17 AM
    • Due to weak LED chip/component sales, CREE now expects FQ1 revenue of $428M, below prior guidance of $440M-$465M and a $455.3M consensus. GAAP EPS is expected to be below guidance of $0.25-$0.30; the non-GAAP consensus is $0.42.
    • Chip/component sales are expected to fall 13% Q/Q and 20% Y/Y to $174M; the latter is a bigger decline than FQ4's 8%. LED lighting sales are expected to rise 7% Q/Q and 51% Y/Y to $223M, and power/RF sales 8% Q/Q and 24% Y/Y to $31M. LED lighting sales were near the high end of target ranges.
    • A mix shift towards LED bulbs relative to chips/components will lead gross margin to be below prior targets; prior non-GAAP gross margin guidance was 37.5%. $54.3M was spent on buybacks during the quarter.
    • Cree adds FQ2 "order visibility remains limited and similar to this point in the first quarter."
    • Shares are making new 52-week lows. Cree has been dealing with tough LED chip/component competition in the mid-range, where (thanks to indoor LED lighting demand) much of the industry's growth has been concentrated. Goldman's downgrade was well-timed.
    | 4 Comments
  • 8:08 AM
    • Park Electrochemical (NYSE:PKE): FQ2 EPS of $0.24 misses by $0.17.
    • Revenue of $42.35M (-4.8% Y/Y) misses by $8.54M.
    • Press Release
    | Comment!
  • 7:50 AM
    • "Increasingly confident" Twitter's (NYSE:TWTR) user monetization gap with Facebook will narrow, JPMorgan boosts Twitter to Overweight with $64 price target.
    • Shares +2.5% premarket
    | 3 Comments
  • 2:42 AM
    • The FCC is prepping its upcoming auction of frequencies known as AWS-3, scheduled to begin on Nov. 13. The auction is expected to raise at least $10B and will include airwaves previously occupied by multiple federal users.
    • A total of 80 entities submitted initial applications, including Dish Network (NASDAQ:DISH) and three of the four largest U.S. wireless carriers - Verizon (NYSE:VZ), AT&T (NYSE:T) and T-Mobile (NYSE:TMUS).
    • Sprint (NYSE:S) is planning sit out on the auction to save firepower for a major sale of low-frequency airwaves scheduled for next year.
    | Comment!
  • 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.
    | Comment!
  • 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.
    | Comment!
  • 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.
    | Comment!
  • 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.
    | Comment!
  • 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.
    | 2 Comments
  • 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.
    | 1 Comment
  • 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
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