Sep. 3, 2013, 8:11 AM
- Microsoft (MSFT) tumbles 4.5% premarket after agreeing to buy Nokia's handset business for $7.2B. The sell side isn't terribly enthusiastic.
- "Nokia deal not likely well-received by shareholders," says Rick Sherlund who just upgraded MSFT 10 days ago. "New management is unlikely to simply break up the company."
- We see this acquisition as incrementally negative," says Bernstein. Doubling down on mobile phones highlights lack of attention on the enterprise side.
- A "hail mary pass," says Oppenheimer's Shaul Eyal. The transaction is a "call option on mobile," he says, where Microsoft stands to maybe see a positive result without risking too much money. The catalysts of a dividend hike, a potential new CEO, and shareholder activism could outweigh any negativity from this deal, he hopes, maintaining his Buy rating and $37 price target.
- NOK +45% premarket.
Sep. 3, 2013, 4:47 AM
- Nokia (NOK) shares jump 37% in Helsinki following news that it's selling its mobile phone unit to Microsoft (MSFT) as part of a deal worth $7.17B.
- SA author Charles Fox reckons a major motive behind the transaction is that Nokia CEO Stephen Elop is now a dead certainty to replace Steve Ballmer as Microsoft boss.
- Shorn of a big loss maker and sitting on a nice cash mountain, the future seems bright for Nokia, although its potential could now be limited.
- Some might think that Microsoft is overpaying for a business "many investors and analysts wrote off as dead," but Fox thinks $5B "seems like chump change for a...division that once ruled the phone market" and could come back.
- Jacob Steinberg echoes these sentiments. "Nokia's phone business deserves a much better price than $5B considering how it generated $20.38B in revenues last year," says Steinberg.
Sep. 2, 2013, 11:51 PM
- Microsoft (MSFT) is paying €3.79B for Nokia's (NOK) Devices & Services ops, and €1.65B to obtain a 10-year non-exclusive license to Nokia's patents. The deal is expected to close in Q1 2014.
- 32K Nokia workers will be joining Microsoft. Stephen Elop and other senior Nokia execs (Jo Harlow, Juha Putkiranta, Timo Toikkanen, and Chris Weber) are expected to be among them. Elop has already been viewed by many as a top candidate to replace Steve Ballmer as Microsoft's CEO.
- Elop is resigning as Nokia's CEO, and from the company's board, to avoid signs of conflicts of interest. He's now head of Devices & Services. Chairman Risto Siilasmaa has been named interim CEO.
- Microsoft is also licensing Nokia's Here mapping platform, and providing Nokia with €1.5B in new financing. Nokia will now focus its efforts on NSN (telecom equipment), Here, and IP licensing; with no phones to obtain licenses for, Nokia now has more leverage in patent negotiations.
- Nokia will "maintain and own" the Nokia brand. Microsoft has obtained a license to use the Nokia brand with Series 30 and Series 40 phones, but apparently not Lumia phones (which presumably will be Microsoft-branded). Nokia won't be able to use its brand "on Nokia's own mobile devices" until the end of 2015.
- Nokia will hold a shareholder's meeting on Nov. 19 to vote on the sale. The company expects the deal to be "significantly accretive to earnings." The deal has a $750M termination fee.
- PRs: Microsoft, Nokia
- Previous: Nokia, Microsoft held advanced talks about phone unit sale
Aug. 23, 2013, 9:15 AM
Aug. 23, 2013, 9:06 AM| Aug. 23, 2013, 9:06 AM | 32 Comments
Aug. 22, 2013, 8:12 AM
- Original bull Rick Sherlund (formerly Goldman, now Nomura) puts Microsoft (MSFT) back on his Buy list due to the "anticipated benefits of shareholder activism." ValueAct owns less than a 1% stake in the company, but is likely to have plenty of support as it presses its case for change says Sherlund. A proxy contest could be a catalyst (the company must be notified by August 30), but the board may just capitulate before that and offer a seat to someone amenable to the activist agenda.
- He's cutting his EPS estimate as he thinks margins will be talked lower at the September 19 Financial Analyst Meeting, but "We do not think fundamentals matter so much over the next six months."
- Shares +1.6% premarket.
Aug. 15, 2013, 10:23 AM
- Greenlight Capital's latest 13F indicates David Einhorn dumped his 6.1M-share Microsoft (MSFT -1.8%) stake, and his 5.4M-share Seagate (STX -3.4%) stake, in Q2.
- Einhorn also took some profits in Marvell (MRVL -1.3%), paring his position to 44.3M shares from 51.8M shares at the end of Q1. But that still leaves him with a ~9% stake in the chipmaker, which has been on a tear this year.
- Einhorn still has sizable positions in Apple (AAPL -0.4%), Vodafone (VOD -1.1%), and Computer Sciences (CSC -1.6%).
Aug. 13, 2013, 9:45 AM
- Microsoft (MSFT -1.6%) has been cut to Hold by Stifel due to Windows division sales, pricing and spending concerns. Evercore upgraded Microsoft recently on account of Office/Server & Tools optimism.
- RetailMeNot (SALE -0.3%) has been assigned 3 bullish and 4 neutral ratings on underwriter coverage day.
- Marvell (MRVL +2.8%) has been upgraded to Top Pick from Outperform by RBC ahead of its Aug. 22 FQ2 report.
- Constant Contact (CTCT +3.9%) has been upgraded to Buy by Lazard.
- Allot (ALLT -1.4%) has been cut to Sector Perform by RBC in the wake of last week's Q2 miss.
- E2open (EOPN +0.7%) has been started at Outperform by Northland.
Aug. 8, 2013, 9:44 AM
- Microsoft (MSFT +0.4%) has been upgraded to Overweight by Evercore.
- Groupon (GRPN +24.8%) had been upgraded to Neutral by UBS, and to Market Perform by Raymond James, following its Q2 revenue beat (I, II), buyback news, and CEO announcement.
- Sina (SINA +2.3%) has been upgraded to Buy by Maxim ahead of its Aug. 12 Q2 report.
- Fusion-io (FIO -22.8%) has been cut to a neutral rating by BofA, Mizuho, Monness Crespi, and Benchmark due to the light guidance provided with its mixed FQ4 results.
- Quad/Graphics (QUAD +3.5%) has been upgraded to Sector Perform by RBC following yesterday's Q2 report.
Jul. 29, 2013, 10:01 AM
- Microsoft (MSFT -0.1%) has been cut to Neutral by Atlantic Equities.
- 3D Systems (DDD +3.7%) and Stratasys (SSYS +1.9%) have been started at Buy by Brean Capital.
- Riverbed (RVBD -1.6%) has been cut to Market Perform by Northland.
- RF Micro (RFMD -2.9%) has been cut to Equal Weight by Barclays.
- Baidu (BIDU +1.8%) has been named a Long Research Tactical Idea by Morgan Stanley.
- Celestica (CLS +1.6%) has been upgraded to Buy by Canaccord.
Jul. 26, 2013, 2:13 PM
Jul. 19, 2013, 12:45 PM
Jul. 19, 2013, 11:55 AMMicrosoft (MSFT -11%) is plunging following its FQ4 miss, and is taking other PC-related names lower with it. HPQ -4.2%. INTC -1.4%. NVDA -2.2%. Goldman (Sell) predicts lower Windows price points for smaller/touch devices and emerging markets piracy will lead Windows sales growth to lag already-weak PC shipment growth. Nomura (Buy) thinks activism (led by ValueAct?) is now more likely, and could drive shares higher. Some bright spots: SQL Server and System Center revenue grew 16% and 14% Y/Y; Lync revenue rose 30%; over 50% of the Fortune 500 is using Azure; and "Windows Phone" revenue (much of it consists of Android royalties) rose by $222M . (FQ4: I, II, III) (transcript) | Jul. 19, 2013, 11:55 AM | 20 Comments
Jul. 19, 2013, 9:54 AMA roundup of tech analyst ratings changes: 1) Microsoft (MSFT -9.2%) has been downgraded to Market Perform by Raymond James and Cowen following its FQ4 miss. 2) AMD (AMD -14.5%) has been downgraded to Underweight by Morgan Stanley, and to Underperform by Credit Suisse, following its Q2 beat. 3) Skyworks (SWKS +10.1%) has been upgraded to Buy by Needham following its FQ3 beat. 4) BlackBerry (BBRY +0.5%) has been upgraded to Market Perform by BMO. 5) IGT (IGT -4.2%) has been downgraded to Underperform by Credit Suisse. 6) SAP (SAP -1.3%) has been downgraded to Neutral by JPMorgan a day after posting a Q2 miss. 7) Ultratech (UTEK -4%) has been downgraded to Hold by Noble Financial. | Jul. 19, 2013, 9:54 AM | Comment!
Jul. 19, 2013, 9:11 AM
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