Tesla disrupted by traditional mechanics 4 Jun 2021 May orders nearly halved in China, The Information reports, after safety concerns. This week’s triple recall in the United States makes a deeper dent in its reputation. Car upstarts have quality crises like everyone else, but they do more damage on the bleeding technology edge.
Aussie M&A silly season gets sillier 4 Jun 2021 Link Group and investment bank Barrenjoey managed to get a better IPO deal for PEXA. But Roc Partners’ brawl over Vitalharvest is getting messier, and Betmakers’ $3 bln bid for a Tabcorp unit is blowing up. It sends a message to this unusually fractious market: “Calm down.”
GoTo steers e-tail to smarter, fiercer last mile 4 Jun 2021 The enlarged Indonesian tech group will make gains in data analytics, helping it keep pace with $130 bln Sea. Getting goods closer to customers will trim order costs and boost on-demand services. It hints at complexities in the pair’s reliance on third-party logistics too.
Test-tube baby-making market is ready to pop 3 Jun 2021 Declining sperm counts, delayed fertility decisions and lower birth rates are trends fueling an investment segment casually known as “femtech.” Societal and governmental reluctance can get in the way of financial returns. But for investors, where there's a will, there’s a way.
AMC’s valuation is a date with derangement 3 Jun 2021 The cinema chain’s adoption by speculative stock traders has pushed its valuation up to $37 billion. That might make sense, if AMC can entice an extra 360 million couples to share a movie and snacks, quadrupling revenue from 2019’s level. Investors are seemingly in La La Land.
BlackRock may find Uncle Sam a tough customer 3 Jun 2021 The New York Fed’s decision to ask Larry Fink’s firm to help sell corporate bonds bought last year is logical. Yet BlackRock won’t get much reward for its patriotic duty. Having eschewed a competitive process, regulators may feel pressure to show they’re not playing favorites.
Babylon’s $4 bln SPAC is big bet on U.S. pivot 3 Jun 2021 The healthcare app sealed a merger with blank-cheque company Alkuri Global Acquisition. Its roots are in the UK, where its artificial intelligence received a mixed welcome. Babylon’s future rests on managing similar blowback and rivals’ competition in the U.S.
Airbus sprints past Boeing in two-horse race 3 Jun 2021 The European plane-maker’s short-haul jet is flying off the shelves, helping Airbus close the revenue gap as Boeing’s 737 MAX woes drag on. Yet the U.S. giant’s valuation premium is as big as it has been. Airbus’s recent surge could last. It’s about time the market catches on.
AMC traders open the Greater Fool portal 3 Jun 2021 Retail investors have propelled the cinema chain’s market value to over $30 billion and its stock price to a level more than 15 times Wall Street’s median target. The company is now selling more stock while warning investors against buying it. The alternate reality can’t last.
Jay Powell’s oil price bet counts on green inertia 3 Jun 2021 The Fed boss and his peers expect rebounding energy costs will only temporarily lift inflation. But if Western oil majors cut capex to please investors, crude could grow more expensive in coming years. Rate-setters are implicitly banking on a more gradual eco-friendly shift.
Viewsroom: Vaccine carrots and sticks, plus donuts 3 Jun 2021 Governments and companies are dangling incentives for people to get jabbed against Covid-19. But it will take more than free weed, lottery tickets and beer to reach herd immunity, Jeff Goldfarb explains. And Dasha Afanasieva says take the pastries, leave the Krispy Kreme shares.
Chancellor: This time isn’t different, but scarier 3 Jun 2021 By any number of proven valuation measures American stocks are poised to deliver negative returns in future years. To believe otherwise is to suggest that “this time is different” – four of the most dangerous words in investing parlance. Active managers will have their day.
GSK’s radical surgery is only a partial fix 3 Jun 2021 GlaxoSmithKline CEO Emma Walmsley is breaking up the $96 bln drugmaker. Spinning off the consumer unit may unlock value and give what’s left firepower for deals and drugs. Yet the split carries risks and will still leave the embattled pharma group facing a lengthy turnaround.
Yuan bulls prod U.S.-China trade talks 3 Jun 2021 Beijing is trying to slow a blistering rally reinforced by foreign capital. The currency’s strength has yet to dent China’s goods surplus, but it could further saddle U.S. consumers with higher prices. That puts pressure on the White House to cut tariffs without losing face.
China’s Zillow can clean up its dual-class house 3 Jun 2021 The late founder of $59 bln Ke left behind a 39% economic stake in his online real estate broker with 81% of the voting rights. There’s no good reason for a trust to wield such feudal control over a company. Converting the shares to common ones would be the right thing to do.
Capital Calls: Russia and US, Clothing IPOs, Food 3 Jun 2021 Concise views on global finance: The Kremlin tells its national state fund to get out of greenback-denominated assets; Rent the Runway thinks about going public; the FAO’s global food index hits its highest level in nearly a decade.
Marqeta asks $13 bln for fintech picks and shovels 2 Jun 2021 That’s the market cap at the top of the IPO range proposed by the issuer of digital payment cards. Marqeta is riding a big trend, mostly serving Square. That brings protection, but also exposure – not only to rivals, but to customers’ own capabilities and their customers’ whims.
Markets are too tranquil for their own good 2 Jun 2021 Measures of expected asset-price volatility have fallen as the U.S. economy roars ahead, Fed boss Jay Powell keeps his foot on the accelerator, and firms and consumers regain some confidence. The recovery is now so fully priced in that even small setbacks could rattle investors.
AT&T augurs a renaissance in corporate breakups 2 Jun 2021 After going gaga for carveouts and spinoffs a few years ago, U.S. companies unleashed just $200 bln of them last year. Investors reward corporations that ditch sprawl for specialization. Ma Bell’s neatly structured Time Warner deal provides a catalyst to break more things up.
BlackRock’s green activism fires on some cylinders 2 Jun 2021 The $9 trln asset manager voted with a hedge fund against Exxon Mobil and for tougher emissions targets at Chevron. That’s progress. Still, its voting record with other oil majors like Royal Dutch Shell suggests it sometimes gives polluters a pat rather than the required shove.
Krispy Kreme IPO looks half-baked 2 Jun 2021 Five years after buying it, JAB is listing the doughnut maker. In that time, it’s opened shops and developed new treats. But growth and profitability are patchy, and demand for sugary pastries may ease as punters become more health-conscious. A mooted $4 bln valuation looks bold.
Capital Calls: AMC craziness, Pro lacrosse 2 Jun 2021 Concise views on global finance: The movie-theater chain raised $230 million from a hedge fund, which promptly sold the shares at a profit; New England Patriots owner Robert Kraft and Alibaba's Joe Tsai are betting on the latest U.S. effort to professionalize the preppy sport.
Japan exchange has a problem with its landlord 2 Jun 2021 The owner of Tokyo’s stock exchange premises regularly appoints directors from its top tenant. Bourse operator JPX has been in the vanguard of official efforts to improve boardroom governance and end such cosy ties. A hedge fund is right to push for better oversight closer to home.
End the Olympics once and for all 2 Jun 2021 The Tokyo games are a Covid calamity. Beijing as 2022 host is turning into a bitter referendum over human rights. Pierre de Coubertin’s noble mission has been corrupted, distorting sports and urban economies. Sponsors and athletes have other options. Pass the torch elsewhere.
Unloved Cloudera tries $5.3 bln revamp in private 1 Jun 2021 The cloud software company went public in 2017 when its hype was already fading, and competition from Amazon has only intensified. A low return on the current business for the private equity buyers suggests the upside is chasing bigger markets rather than cutting costs.
Porsche family applies some gas to VW untangling 1 Jun 2021 The 135 bln euro carmaker’s controlling shareholder could take a direct stake in the eponymous luxury marque if it listed. Getting the Porsche-Piech family, VW bosses and public investors to play ball could be tricky, but they could all get something out of a deal.
The Exchange: Steering Europe’s green transition 1 Jun 2021 Frans Timmermans has a key leadership role in the European Union’s quest to reduce its 2030 emissions by 55% compared to 1990 levels. Ahead of a major set of green policy updates next month, he talks to George Hay about both these and November’s COP26 conference.
Pizza-oven takeover may offer extra toppings 1 Jun 2021 Italy’s Ali Group is barging into America’s fast-food kitchens with gusto, throwing down $3.3 bln in cash to upset Welbilt’s agreed sale to Middleby. It’s a spicy move for an unlisted, virtually unknown family firm without fancy corporate-finance tools. And it just may work.
Vaccine lollipops will give way to bitter medicine 1 Jun 2021 Qantas plans to award frequent flyer miles as Hong Kong waives quarantine for bankers, expanding a list of incentives to get immunised. Tougher tactics like denying the uninoculated entry to venues are also starting. It augurs an ugly divide between the jabbed and the jab-nots.
D.Telekom’s U.S. call is mixed investor blessing 1 Jun 2021 CEO Tim Hoettges may splash $12 bln to take majority control of T-Mobile. Option contracts allow him to keep would-be rivals away at a discount price. But since the big U.S. holding gets scant credit in the German parent’s valuation, it may not be money well spent.