United States of America

Lufax slips softly priced IPO past Ant hullaballoo

30 October 2020

The Ping An-backed Chinese fintech outfit has garnered less hype than Jack Ma’s record-shattering rival. It isn’t growing as fast, but its online lending unit is profitable and established. A $33 bln valuation, at 13 times forecast 2021 earnings, makes for a compelling option.

Apple’s reinvention risks are yet to be priced in

29 October 2020

Services revenue surged 16% in its last quarter to $14.5 bln. With iPhone markets mature, it's the main reason Apple's stock price has doubled in two years. Yet rivals and regulators have that business in their sights. The company's $1.9 trln valuation assumes they get nowhere.

Facebook nears moment when world is not enough

29 October 2020

The summer’s ad boycott made no dent on revenue, which grew 22% in the third quarter, and didn’t deter the social network’s users. Facebook’s apps now reach 41% of the global population. Expansion on that front is bound to slow down. Revenue per user will get more important.

Amazon’s twin engines ready for the stratosphere

29 October 2020

The company had a stellar quarter from e-commerce and cloud computing. Those businesses were already good, and 2020’s challenges made them better. With a market value of $1.6 trln, Amazon is either a bargain or an antitrust target. Threading the needle is getting harder.

The Biden portfolio is mainly the Trump portfolio

29 October 2020

It might matter for mini sectors, like solar power and cannabis, who wins next week’s U.S. presidential election. But as Trump’s impact on coal shows, it’s not that predictable. Instead the Fed, stimulus, taxes and the post-Covid economy are cause for an asset-allocation rethink.

Biden win would clear multiple green roadblocks

29 October 2020

The Democratic nominee will rejoin the Paris agreement on emissions cuts if he wins the U.S. election. That’s good, but largely symbolic. More important are a pledge to hike clean energy spending and the scope for his administration to advance green financing and carbon pricing.

Ford accelerates turnaround with pickup pricing

29 October 2020

The $30 bln automaker blew past third-quarter estimates, reporting $2.4 bln in earnings. Vehicle prices benefited from low Covid-affected supply and hearty demand. That's a helpful bequest from the old CEO. It's now down to the new boss to deliver on electric-vehicle promises.

Viewsroom: What we’re expecting on election night

29 October 2020

If Joe Biden wins Donald Trump’s place as POTUS on Nov. 3, and the Senate turns Democrat, lots of things will change – chief among them tax and economic policy. But big tech companies and China’s Communist Party will gain no reprieve. Rob Cox, Gina Chon and John Foley discuss.

Arnault’s Tiffany tantrum was not worth the fuss

29 October 2020

The luxury tycoon trashed the U.S. jeweller’s management, went to legal war in Delaware and enlisted Paris to wriggle off the hook. In a U-turn, LVMH will now swallow its target for a discount of perhaps below $290 mln. That’s far less than the long-term hit to LVMH’s reputation.

Big Tech backlash will hurt Little Tech more

28 October 2020

Facebook, Twitter and Google hide behind a law that protects them from liability for toxic content but lets them censor when they see fit. Removing that shield, as some lawmakers want to do, would be inconvenient and expensive for them, but brutal for smaller rivals like Yelp.

Boeing’s question is not how much but how long

28 October 2020

The $86 bln aerospace firm jettisoned $5.1 bln of cash in the latest quarter, not much better than the three months before. Other airborne industries are suffering too, but despite a reasonable balance-sheet cushion, Boeing is even less suited to endure prolonged disruptions.

Apollo would carry on just fine without Leon Black

28 October 2020

The 30-year-old investment shop is under intense scrutiny because of revelations about its co-founder’s dealings with the late sex offender Jeffrey Epstein. At this stage, credit eclipses buyouts anyway. And the firm has deepened its bench enough to move forward without Black.

Argentina’s creditors made two silly mistakes

28 October 2020

Some investors say their newly restructured bonds have tanked due to President Fernandez’s lousy policies. They’re right. But they’re shouting in the wind, because they agreed to a debt rejig based on unenforceable promises, and gave up what leverage they had in the process.

Fiat and Peugeot need each other more than ever

28 October 2020

Jeep-maker FCA made a strong profit in its key North American market. That’s helpful for marriage partner Peugeot, whose European heartland faces new pandemic lockdowns. Neither has much business in rebounding China. Their 5 bln euros of merger savings can’t come soon enough.

GE boss reaches milestone in Sisyphean trial

28 October 2020

Larry Culp managed to offset damage from grounded planes and declining power-sector demand with helpfully timed payments to report positive cash flow in the third quarter. Other challenges remain, from debt to GE’s insurance business. Then there’s the existential part.

It’s time for Sheldon Adelson to leave Las Vegas

28 October 2020

His $37 bln casino company may sell U.S. assets for $6 bln to double down on fast-growing Asian markets. That would thin its hedge against risks in Chinese Macau, but Nevada contributes barely 10% of earnings. Las Vegas Sands could use the cash for deals – and debts.

Big banks are ill-suited to be biodiversity cops

28 October 2020

Under pressure from investors and regulators, lenders have woken up to the financial risks of climate change. Activists are pushing for similar urgency in protecting the world’s variety of plants, animals and insects. But any big shift requires governments to lay down the law.

Remember TikTok? Send an indulgence to deal gods

28 October 2020

The Chinese-backed video platform is waiting for a U.S. court ruling, Trump administration approval, and then Beijing has to have a word. That’s all before integration with Oracle and Walmart even starts. With the U.S. election forthcoming, TikTok is stuck in M&A purgatory.

Microsoft can flip the antitrust script

27 October 2020

The software giant and the rest of Big Tech have benefited from pandemic conditions. It saw a 12% jump in revenue. But having been through the anticompetitive ringer, it’s largely escaped the current D.C. scrutiny of its rivals. That gives it an edge in focusing more on growth.

Health insurers put Google market power to shame

27 October 2020

Anthem, Humana and UnitedHealth stocks have outperformed the tech giant's parent Alphabet over the past decade. U.S. insurers benefit from near-monopolies in many regions. Americans have few choices among hospitals too. Maybe Big Health is a better antitrust target than Big Tech.