Fiat shareholders opt for hope over adversity 28 Jan 2015 The automaker hit 2014 earnings targets. But its margins are abysmal, its debt load high and the dividend’s still suspended. There’s some progress, though, even in Europe. The upcoming Ferrari IPO, boss Sergio Marchionne’s reputation and a weak euro are keeping the stock purring.
Apple shines as Cook dishes up Chinese feast 27 Jan 2015 The tech giant overcame a strong dollar and stiff competition from Samsung in the Middle Kingdom, helping it to record Q1 iPhone sales of 74 mln worldwide. With the company’s watch near market and Apple Pay doing well, CEO Tim Cook has found a recipe to rival Steve Jobs’ success.
Yahoo’s Alibaba spinoff gives Mayer one more year 27 Jan 2015 Offloading the $40 bln stake to shareholders, without a tax hit, is a long-awaited move. It will, however, leave Yahoo’s smaller core exposed, with Mayer’s two-and-a-half-year turnaround not yet bringing sales or profit growth. Luckily she has cover from Alibaba until late 2015.
U.S. deficit danger deferred but not defeated 27 Jan 2015 Congress’s wonks see debt-to-GDP shrinking for a few years as the $500 bln yearly federal shortfall steadies. Baby-boomer retirement and healthcare costs will, sadly, help reverse the trend. Decade-long forecasts are guesses but suggest lawmakers still have hard choices to make.
Motown star faces tough encore in Atlantic City 27 Jan 2015 Fresh off managing Detroit’s $18 bln bankruptcy, Kevyn Orr is New Jersey Governor Christie’s pick to tackle the gambling hub’s reeling casinos and soaring debts. It’s a smaller job, but this time Orr may not have a court to help. Other troubled U.S. cities will be watching closely.
Microsoft’s Satya Nadella needs a better OS 27 Jan 2015 The software giant’s CEO had a simple plan for his first year in charge: don’t repeat predecessor Steve Ballmer’s errors. He has not been that successful, as weak quarterly earnings show. Providing a clear long-term strategy would be more useful than just avoiding past mistakes.
DuPont’s macro woes hand Nelson Peltz advantage 27 Jan 2015 The $67 bln chemical giant is promising more cuts and a bigger buyback to fend off the activist investor. But it’s already barely hitting estimates. A stronger dollar and falling commodity prices will make that even harder in 2015. DuPont boss Ellen Kullman is on the back foot.
New York mayor gets his snowy Wall Street moment 26 Jan 2015 Bill de Blasio warns the coming blizzard may be the biggest ever, a more reasonable assessment than Goldman claims of 20-plus standard deviation trading events. It’s high time Big Apple politicians stopped ignoring tail risks and generated political capital from them instead.
An $18 bln deal straightens out twisted pipelines 26 Jan 2015 The convoluted structure at Energy Transfer Equity isn’t doing it any favors. Combining two master limited partnerships it controls may generate some savings. More importantly, it makes the company slightly easier for increasingly skeptical oil and gas investors to understand.
Pentagon, Davos add more on cyber risks than Obama 26 Jan 2015 The U.S. military knows it has a problem and wants to defend itself better. The World Economic Forum hopes to quantify the dangers for companies. But the White House, while right to talk up the issue, seems more focused on getting information than protecting it.
U.S. $16 bln paper deal requires precise folding 26 Jan 2015 Rock-Tenn and MeadWestvaco shareholders will split their combined company evenly, with a balanced board. Investors are already inking in $300 mln of annual cuts, pushing both stocks up. Mergers that look equal, though, can still provoke business and cultural upheaval.
Obama’s nuclear gift to Modi is shrewd investment 26 Jan 2015 The U.S. president has unblocked a stalled nuclear power deal with India, allowing Prime Minister Narendra Modi to build new reactors. While that will boost orders for GE-Hitachi and Westinghouse, bigger gains to the U.S. economy will come from ending India’s energy deficit.
More Wall Street CEO cash is hint for shareholders 23 Jan 2015 JPMorgan is paying a portion of Jamie Dimon’s bonus in hard money for the first time since 2011. Goldman is boosting Lloyd Blankfein’s cash. Meanwhile, stock gains are slowing. Bank bosses still get most of their comp in shares. But the switch may suggest equity has less to offer.
Capital One slips on Main Street bank victory lap 23 Jan 2015 A slew of mid-sized lenders like BB&T, U.S. Bancorp and PNC beat fourth-quarter estimates as Wall Street giants faltered. Capital One, though, fell short as loan loss provisions rose. Though small, it’s a sign that an industry slowdown may be more likely than an earnings boom.
Review: The Mad Men are watching you 23 Jan 2015 A lot happens in a split second online, much of it good for the ad industry but worrying for privacy advocates. Instant auctions to push tailored ads to individuals are growing fast, says “Targeted” author Mike Smith. The ad men will need ever more personal data to fuel them.
Siemens faces big oil deal debacle 23 Jan 2015 The collapsing oil price turns the German engineer’s dash for shale into a costly blunder. Its $7.6 bln September bid for U.S. oilfield kit maker Dresser-Rand will stain CEO Joe Kaeser’s reputation. With shares of Dresser’s peers clobbered, a major impairment is looming.
Google fans flames of wireless price war 22 Jan 2015 The search giant plans to sell relabeled service from Sprint and T-Mobile US. This virtual carrier is a cheap way to intensify the battle for customers raging between these two, AT&T and Verizon. Consumers should benefit – Google, too, if it can avoid getting burned.
Oil billionaire pumps Kinder Morgan for tidy gain 22 Jan 2015 Continental boss Harold Hamm sold Hiland Partners, his private pipeline firm, to its giant rival for $3 bln. That ends a conflict arising from his initial stake in Hiland and covers his $1 bln divorce. Kinder, meanwhile, gets a prized – if pricey – foothold in the Bakken shale.
RBC’s foray south a pricey bet that two’s a charm 22 Jan 2015 The Canadian bank is paying $5.4 bln for U.S. lender City National, a 26 pct premium that planned cost cuts don’t justify. The so-called banker to Hollywood stars is growing well. But RBC’s last venture into American retail banking was a mess. It needs to prove it can do better.
Portuguese scandal breeds oddest of M&A activists 22 Jan 2015 The $9 bln sale of Portugal Telecom’s old domestic unit to France’s Altice is at risk. The unlikely foe? The lawyer who runs PT’s own investor meetings. Resistance to the deal is understandable after PT’s history of bad management. But halting the disposal would be self-sabotage.