Oct. 25, 2013, 9:22 AM
Oct. 24, 2013, 4:07 PM
Oct. 15, 2013, 7:15 AM
- "We think the stage is set for a series of value creating events to unfold over the next 18 months," says analyst Ross MacMIllan, upgrading Microsoft (MSFT) to Buy and lifting his price target to $42 from $33.
- Among those events is a new operating structure with greater transparency on the best assets, or what MacMillan calls "BestCo" - the commercial segment containing key assets transitioning to the cloud. "OtherCo" is the devices and consumer segment which carry less clear value. MacMillan sees the market allowing a higher valuation to the BestCo operations.
- As for the new CEO, MacMillan sees the potential for better portfolio focus - i.e. which assets should remain as core and what should be viewed as non-core - as well as someone who sees the company's massive recurring cash flows as opportunity to give more back to shareholders.
- Shares +1% premarket.
Sep. 20, 2013, 1:36 PM
- After meeting with Google Glass (GOOG) LCOS microdisplay supplier Himax (HIMX +5.3%), Chardan's Jay Srivatsa reports Google has prompted Himax to ramp production, and thinks Glass will see a full commercial launch in Q1 2014. He adds Google might launch more than one Glass model, to cater to those needing prescription glasses.
- Srivasta believes Himax has already raised microdisplay production to 500K units/month from a prior 200K/month, and is set to produce 850K/month by the end of Q1.
- Pricing for a commercial version of Glass remains a mystery. The developer edition was sold earlier this year for $1,500. Google has said it doesn't plan to run ads on Glass, and wants to profit from hardware sales.
- Himax also told Srivasta it's in the "early stages of ramping [microdisplay] production for another company," which the analyst believes is Microsoft (MSFT -2.5%). Himax thinks the company's product could launch in mid-2014.
- Meanwhile, TechCrunch reports Microsoft might spend up to $200M to buy wearable computing patents and assets from military contractor Osterhout Design. Osterhout has worked on head-mounted displays in the past, among many other products.
- Yesterday, Oppenheimer reported Himax is seeing "significant" interest in its microdisplays from other firms in the wake of the Google deal. Himax shares are making new highs again today.
Sep. 20, 2013, 12:12 PM
- Pac Crest (Sector Perform), reviewing yesterday's analyst day: "Microsoft (MSFT -2.4%) could not answer investors’ most pressing question ... Will Microsoft’s board allow a new CEO to fundamentally restructure the company?" The firm is also disappointed there management gave no sign it will do a breakup anytime soon. Calls for a breakup have grown lately.
- Morgan Stanley (Equal Weight) points out Microsoft is guiding for FY14 capex of $6.5B, up 51% from FY13's $4.3B and above the firm's estimate of $5.6B. Microsoft attributes the spending ramp to cloud services (Azure, Xbox Live, Office 365) needs. The firm is, however, pleased with the rapid FY13 growth reported for Office 365 seats (+350%), Azure (+200%), and cloud CRM software (+80%).
- Citi (Buy) had only been expecting FY14 capex guidance of $4.8B. But it likes Microsoft's new reporting structure, arguing it will "give more clear visibility into consumer vs commercial revenue and profit contribution."
- Analyst day details: I, II, III
- Presentation slides/transcripts
Sep. 4, 2013, 4:10 PM
- Sources tell the WSJ BlackBerry (BBRY +5.9%) is " aiming to run a fast auction process that could be wrapped up by November." The report led shares to spike just before the close.
- Meanwhile, sources tell Bloomberg Microsoft (MSFT -2.2%) is "keeping an eye" on BlackBerry in the wake of the Nokia deal. Given Microsoft's commitment to Windows Phone, any interest in BlackBerry from the software giant could be related to the company's BES/network operations center assets rather than its hardware ops.
- The reports come as analysts continue to cut estimates. BlueFin Research says its checks indicate there have been major BB10 production cuts, and that BlackBerry has "amassed significant component and finished goods internal inventories, while many carriers and retailers are not restocking."
Sep. 4, 2013, 10:12 AM
- Microsoft (MSFT -1.8%) has been cut to Equal Weight by Morgan Stanley in the wake of the Nokia deal.
- Nokia (NOK +2.1%) has been received four more upgrades - from Raymond James, Jefferies, BofA/Merrill, and BNP Paribas - on top of the upgrades it received yesterday. Meanwhile, Argus has cut shares to Hold.
- Angie's List (ANGI +3.8%) has been upgraded to Outperform by RBC.
- Guidewire (GWRE -4.4%) has been cut to Sell by Citi following its FQ4 report. Though the company beat estimates, it guided on its CC for FQ1 revenue of $61.4M-$63.4M and EPS of -$0.18 to -$0.15, below a consensus of $72M and $0.03. Likewise, FY14 revenue is expected to be in a range of $328.5M-$340.5M, below a $348M consensus.
- InvenSense (INVN +1.1%) has been upgraded to Outperform by Baird.
- Concur (CNQR -1.1%) has been cut to Hold by Wunderlich.
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.
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