Dec. 13, 2013, 9:38 AM
- Amazon (AMZN +1.3%) has been upgraded to Strong Buy by ISI.
- Stratasys (SSYS +2.5%) has been started at Overweight by Stephens.
- Ciena (CIEN +1.5%) has been upgraded to Outperform by BMO a day after posting mixed FQ4 results and slightly disappointing FQ1 revenue guidance (midpoint below consensus).
- Ubiquiti (UBNT +1.1%) has been started at Outperform by Wells Fargo.
- Procera (PKT +2.1%) has been started at Buy by D.A. Davidson.
- China Mobile Games (CMGE +3%) has been started at Buy by Brean.
Dec. 3, 2013, 11:10 AM
- Rackspace (RAX -5.9%) is once more falling (previous) due to a product announcement from a cloud infrastructure (IaaS) rival, only this time the culprit is Google (GOOG +0.5%) rather than Amazon (AMZN -1.8%). The search giant has taken its Compute Engine IaaS platform out of beta, and has cut computing and persistent storage prices by 10% and 60%, respectively.
- Amazon is also lower, as are Red Hat (RHT -1.3%) and data center owner Equinix (EQIX -0.9%). Like Racksapce, Red Hat is a major supporter of the OpenStack IaaS platform.
- In addition to cutting prices, Google has greatly expanded Compute Engine's feature set. The company has added support for more Linux variants (inc. Red Hat and rival distributions) and popular app deployment tool Docker, and is launching a 16-core computing instance and high-I/O storage instances for intense workloads.
- Amazon, which just unveiled several new cloud services, still has a big edge on Google in terms of scale, feature set, and developer support. But consulting firm Scalr declares Google to be ahead of Amazon in terms of performance and reliability. They're considered even on pricing.
- Moreover Google's IT and engineering resources, together with its expertise in creating cheap, high-performance, data center hardware, should make it a solid rival in time, at least for basic computing/storage services.
- Previous: Amazon dominates cloud infrastructure
Nov. 14, 2013, 2:21 PM
- Several analysts argue Amazon's (AMZN +3.1%) cloud-based WorkSpaces PC virtualization platform could prove to be a long-term threat to Citrix (CTXS -5.4%) and VMware's (VMW -2.9%) on-premises offerings.
- Nomura notes WorkSpaces is initially focused on SMBs, who tend to shy away from expensive on-premises deployments, rather than the enterprises Citrix derives a large portion of its sales from. But it still thinks the platform could become "a serious and broader-based competitor if it ends up vying for larger enterprises." Jefferies, meanwhile, calls WorkSpaces attractively priced and a threat to the majority of Citrix's business.
- Stifel is defending Citrix. The firm argues Amazon is "targeting the low-end of the DaaS market as it doesn’t offer the full range of features (or deployment options) that Citrix’s desktop solutions offer." It's worth noting many cloud-based apps/services initially targeted SMBs before gradually moving upmarket.
- Also: Amazon has launched AppStream, a service that allows apps hosted on its cloud infrastructure to be streamed to mobile devices (and perhaps eventually PCs). The service could end up acting as competition for Citrix and VMware's app virtualization platforms.
- In addition to Amazon, Cisco's guidance is likely pressuring Citrix and VMware. Citrix and Cisco have an application delivery controller partnership, and VMware (though competing with Cisco in some areas) maintains a multi-faceted software alliance with the networking giant.
- Last month, VMware bought Desktone, developer of a PC virtualization platform than can enable cloud-based services. VMware has promised to cross-sell Desktone's platform to its 11K service provider partners.
Nov. 13, 2013, 1:43 PM
- At its annual re:Invent conference, Amazon Web Services (AMZN +1.2%) has unveiled WorkSpaces, a PC virtualization offering that allows businesses to host virtual desktops on Amazon's cloud infrastructure.
- PC virtualization/thin client software leader Citrix (CTXS -3.7%) dived following the product launch, but has recouped some of its losses following news the company is an AWS PC virtualization partner. Top Citrix rival VMware (VMW +0.2%) has fallen moderately, but is still near breakeven.
- Amazon asserts WorkSpaces is easier to manage than traditional PC virtualization offerings, and also carries much lower up-front costs. AWS chief Andy Jassy: "Virtual desktops are difficult to set up, they’re difficult to manage, you have to worry about the hardware, the virtual desktop infrastructure ... We wondered if there were an easier way."
- WorkSpaces is priced fairly aggressively - Amazon is charging $35-$60/month per user, depending on the plan, and doesn't require any long-term commitments.
- Also: AWS, which has depended heavily on Internet companies for its early growth, has bolstered its enterprise chops by adding support for SAML 2.0, a commonly-used identity management protocol. Adding SAML 2.0 support makes it easier for enterprises to manage access to, and enable single sign-on for, AWS-hosted services.
Oct. 28, 2013, 2:17 PM
- Standpoint Research enters the debate on Amazon (AMZN -1.1%) by initiating coverage on the company with a Sell rating and a soft price target of $280.
- Though the ratings snub from the investment firm is creating a bit of a selling ripple in afternoon trading, it's an inside baseball blog post from an ex-Amazon employee on the company's misunderstood business model that could prove to be the more insightful read.
Oct. 25, 2013, 11:33 AM
- Raymond James has upped Amazon (AMZN +8%) to Strong Buy following its Q3 revenue beat, while setting a PT of $446. It's far from alone in raising its PT; RBC has set an upside scenario target of $500, while declaring the quarter "something of an inflection point."
- Jefferies observes Amazon's op. income has topped the high end of guidance for 8 straight quarters. Evercore likes the fact Amazon's North American 33% electronics & general merchandise (EGM) sales growth (~2x U.S. e-commerce growth) beat the firm's 27% estimate.
- Accelerating growth - Q3 rev. growth of 24% topped Q2's 22% - and ongoing gross margin improvement - Q3 GM rose 240 bps Y/Y to 27.7% - are getting attention. Global media revenue ($5.03B) +9% Y/Y in Q3 vs. +7% in Q2, EGM ($11.05B) +29% vs. +28%.
- Amazon's total Q3 paid unit growth was 29%, even with Q2, and 3rd-party sellers still made up 40% of unit sales. Active accounts +9M Q/Q to 224M after rising by 6M in Q2. Also, North American "Other" sales (dominated by AWS) rose 56% Y/Y to $1.01B.
- At the same time, Amazon's aggressive spending isn't letting up. Fulfillment spend rose to 11.5% of revenue from 10.5% a year ago, and tech/content spend to 9.2% from 7.8%. TTM capex +$320M Q/Q to $4.59B.
- Interestingly, eBay (EBAY -1.6%) is lower even as Amazon soars. When contrasted with Amazon's figures, eBay's Q3 Marketplaces numbers and Q4 guidance point to further share losses on a relative basis.
- Q3 results, details/guidance, CC transcript
Oct. 25, 2013, 9:22 AM
Oct. 24, 2013, 4:25 PM
- Amazon (AMZN) grew product sales at a fast clip of 19.6% in Q3, and services sales rose even faster at 45%, but total operating expenses didn't just go away as the company's cost of sales rose 20% to $12.366B during the period.
- Sales grew 31% for the company's North America segment and 15% for International as the net sales mix moved 3 bps back toward North America.
- The company sees Q4 revenue of of $23.5B - $26.5B to top its earlier forecast, but with a mid-point below the analysts' consensus estimate of $25.9B.
- The guidance for Q4 operating income is -$500M to +$500M, a nifty $1B range for a single quarters' worth of sales. (PR)
- AMZN +6.0% AH to $351.36.
Oct. 18, 2013, 10:29 AM
- "We believe that Google's (GOOG +12.8%) ability to monetize experiences through engagement-based services will allow it to disrupt many hardware and software layers over time," writes Evercore's Ken Sena, exemplifying the glowing analyst commentary that has followed Google's Q3 beat.
- Sena, who is raising his PT to $1,100, sees Google's services investments pressuring near-term margins, but also creating "a stronger platform ecosystem in which more collected data, better predictive analytics, and an increased amount of screen connectivity will lead to better overall search economics in addition to new opportunities."
- Needham and Jefferies have raised their PTs to $1,150, and Deutsche has raised its target to $1,220. YouTube's mobile growth, strong paid click volumes, and the potential for Enhanced Campaigns to lift search ad sales (after doing less damage than expected in Q3) are all mentioned as reasons to stay bullish.
- U.S. Internet peers continue to rally in sympathy: FB +4.1%. LNKD +3.7%. YELP +7.8%. AMZN +3.3%. Z +3.9%. TRLA +4.8%. ZNGA +2.8%.
- Foreign Internet names are also moving higher: BIDU +5%. YOKU +6.9%. SINA +3.7%. RENN +4.4%. QIHU +4.9%. DANG +5.9%. YNDX +4%. SIFY +3.4%.
- Google's Q3 results, details, CC remarks, transcript
Oct. 18, 2013, 9:34 AM
- AMD (AMD -12.7%) has been cut to Neutral by BofA/Merrill after beating Q3 estimates and providing above-consensus Q4 revenue guidance, but also reporting a 15% Y/Y drop in CPU division sales due to PC weakness.
- Verizon (VZ +0.8%) has been upgraded to Buy by Stifel a day after beating Q3 estimates and reporting better-than-expected mobile subscriber adds.
- Amazon (AMZN +2.4%) has been upgraded to Buy by UBS ahead of its Oct. 24 Q3 report.
- VMware (VMW +2.8%) has been upgraded to Overweight by JPMorgan ahead of Monday's Q3 report.
- T-Mobile USA (TMUS +2.7%) has been added to Goldman's Conviction Buy list ahead of its Nov. 5 Q3 report.
- Intuit (INTU +2.6%) has been upgraded to Buy by BofA/Merrill.
- Align Technology (ALGN +24.4%) has been upgraded to Buy by Cantor following its Q3 beat.
- LG Display (LPL -0.2%) has been cut to Hold by Craig-Hallum after issuing a Q4 warning.
- Ultratech (UTEK -10.2%) has been cut to Hold by Canaccord following its Q3 miss.
- Sierra Wireless (SWIR -1%) has been cut to Market Perform by Raymond James; Q3 results arrive on Nov. 7.
- Aspen Technology (AZPN -0.9%) has been cut to Neutral by JPMorgan.
- Analog chipmakers International Rectifier (IRF -1.7%) and Monolithic Power (MPWR -1.3%) have been cut to Market Perform by Wells Fargo.
- U.S. Cellular (USM -1.2%) has been started at Underperform by FBR.
Oct. 16, 2013, 4:42 PM
- EBAY expects Q4 revenue of $4.5B-$4.6B and EPS of $0.79-$0.81, below a consensus of $4.64B and $0.83. In a quote talking up eBay's Q3 numbers, CEO John Donahoe calls the macro environment "fairly lackluster." Back in July, European and Korean macro issues were blamed for eBay's below-consensus Q3 guidance.
- Payments division (PayPal) growth remained strong in Q3: sales +19% Y/Y (to $1.62B) vs. +20% in Q2. Payment volume +25% (to $43.8B) vs. +24%, active accounts rose by 5M Q/Q to 137M (+17% Y/Y). Merchant services (non-eBay) transaction volume +30% Y/Y.
- Marketplaces revenue +12% Y/Y (to $2.03B) vs. +10% in Q2; mobile provided a lift. GMV (exc. vehicles) +13%, even with Q2. U.S. GMV +15% vs. +16%, international +12% vs. +11%. Total listings topped 500M. Active users rose by 3.9M vs. 3.5M in Q2, +14% Y/Y and reaching 124M.
- EBAY -4.2% AH. AMZN -1.2% in sympathy. CC at 5PM ET.
- Q3 results, PR
Oct. 3, 2013, 9:44 AM
- PayPal (EBAY -0.1%) is partnering with a handful of retailers to provide free two-day shipping within the U.S. for a limited time on purchases paid via PayPal. Partners include Levi's, Sports Authority, Aeropostale, and iRobot.
- No word on whether PayPal plans to expand the test, or eventually offer some kind of permanent service (perhaps for a fee). The test appears squarely aimed at Amazon Prime (AMZN -0.2%), which provides free two-day shipping on millions of items on Amazon's site, in exchange for a $79/year fee. Amazon was estimated in March to have 10M Prime subs.
- Separately, Groupon (GRPN +2.4%) announces it has hired Amazon Prime VP Robbie Schweitzer to be its SVP of operations. The company has also hired Angie's List (ANGI -14.7%) e-commerce exec David Kerr to help create "a marketplace experience for Groupon customers to find, schedule and purchase deals from local service providers" (will likely compete with Angie's).
- Two other hires: A VP to head the Groupon Reserve high-end restaurant reservation/deals service (Lisa Kennedy), and one to head Groupon's commercial finance ops (Hoke Horne).
- Yesterday: Angie's List testing price cuts
Aug. 13, 2013, 11:13 AM
- BlackBerry (BBRY +9%) is now up 27% since Reuters first reported the company is thinking of going private. The company's enterprise value (excludes $3.1B in cash/investments) has grown to $3B.
- While Prem Watsa reportedly talks to both P-E firms and "industry players" about a deal, the NY Post reports BlackBerry would prefer to be acquired by a "Google-like" buyer rather than a P-E firm. One source speculates Amazon (AMZN - believed to be interested back in 2011, and possibly able to leverage BlackBerry's NOCs to bolster AWS) could be an option.
- AllThingsD reports Silver Lake "has no interest in working with Watsa or BlackBerry" on a bid.
- Another upgrade has come in: Scotia Capital has lifted shares to Outperform.
- More on BlackBerry
Jul. 18, 2013, 11:12 AMNeedham downgrades eBay (EBAY -6.4%) to Hold following its Q2 revenue miss and light Q3 guidance, citing international softness and "slowing Marketplace fundamentals." Though granting eBay is taking steps to revamp Marketplaces, the firm doesn't "expect any single investment to serve as a momentum-changing catalyst in the near term." Top-rated sellers (22% Q2 same-store sales growth) and mobile (2M new users, 5.6M listings/week, $20B+ in 2013 transactions expected) remain areas of strength for Marketplaces. Amazon (AMZN -1.2%) continues to follow eBay lower, but Overstock (OSTK +15.7%) is soaring after trouncing Q2 estimates and reporting a 170 bps Y/Y increase in gross margin to 19.7%. (eBay transcript) | Comment!
Jul. 17, 2013, 4:36 PMeBay (EBAY) is guiding for Q3 revenue of $3.85B-$3.95B and EPS of $0.61-$0.63, below a consensus of $3.97B and $0.65. 2013 guidance is for revenue of $16B-$16.5B and EPS of $2.70-$2.75 vs. a consensus of $16.3B and $2.75. The company says "macroeconomic headwinds in Europe and Korea will continue to be a challenge" in 2H. PayPal revenue +20% Y/Y in Q2, up from Q1's 18%. But Marketplaces revenue (exc. a tax gain) only +10%, down from Q1's +13%. Shares -5.5% AH. Amazon (AMZN) -0.7% in sympathy. CC at 5PM ET (webcast). (Q2 results) (slides) (PR) | Comment!
Jul. 17, 2013, 1:59 PMMore bad news for leading Groupon (GRPN +5.7%) rival LivingSocial: the company has shuttered both its NYC office and local events unit in an effort to pare costs. The moves come a month after the company closed its Seattle office and requested employees work remotely. LivingSocial, 29%-owned by Amazon (AMZN), posted a $50M net loss in Q1 to go with revenue of $135M (+23% Y/Y). | 1 Comment
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Amazon.com Inc is an online retailer. The Company sells its products through the website which provides services, such as advertising services and co-branded credit card agreements. It also offerselectronic devices like Kindle e-readers and Fire tablets.
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