United States of America

Salesforce visualizes M&A benefits, market doesn’t

10 June 2019

The $125 bln software firm is paying $15 bln for Tableau. Founder Marc Benioff says the combination will allow sales reps to see data better, and that makes sense. Wall Street, though, is looking askance at a premium price that comes in at 11 times Tableau’s forecast revenue.

The Exchange: Dick’s sticks to its guns

10 June 2019

Dick’s Sporting Goods lost sales, customers and suppliers when it banned assault-style weapons from its stores last year. Over a year later, boss Ed Stack tells Breakingviews what he learned from taking a stand on gun violence, and addresses his newer challenge of China tariffs.

UTC plunges into some hasty M&A aerobatics

10 June 2019

The aerospace group plans to fuse with $52 bln defense firm Raytheon, months after it closed another large deal and while in the middle of a breakup. Even if UTC can convince investors that the merger makes sense, it may be wiser to wait until its own re-engineering is complete.

Mexico truce is sad episode in trade reality show

10 June 2019

U.S. President Trump scrapped planned import taxes after Mexico pledged more action on migrant crossings – something it had already offered to do. It reinforces the illusion that levies are a potent way to tackle non-trade issues, and sets the scene for more unproductive drama.

Elliott tries to rip up the retail history books

7 June 2019

The investment firm could make a handsome return buying U.S. bookseller Barnes & Noble for about $500 mln and copying the formula that revived its UK chain Waterstones. The challenge is that Barnes & Noble is far bigger, while retail has a habit of getting lost in translation.

Cool U.S. jobs report helps Fed run economy hot

7 June 2019

Employment gains in May were weak. The volatile data doesn’t yet reflect the latest trade tensions. Meanwhile, traders are betting the central bank will soon cut rates rather than stand pat. Weak inflation and rising productivity give the Fed room to do so, but it may take time.

Review: Rockonomics nicely reflects the real world

7 June 2019

Alan Krueger’s posthumous work on the finances of rock and roll functions in equal parts as a basic industry primer, a textbook on broader economic concepts and a guidebook for musicians wanting to start a band. It’s also a window, if an imperfect one, into the author’s soul.

Beyond Meat gets extra fire from being rare

7 June 2019

The meatless-burger maker reported first-quarter numbers only a hair better than it already estimated yet the stock, which had already quadrupled since its IPO a month ago, surged more than 15%. A $7 bln valuation is too hot – but then it’s the only item of its kind on the menu.

Facebook coin may aid crypto-rivals more than self

6 June 2019

Mark Zuckerberg’s social network could launch its own digital currency as a way into global payments, but it faces daunting trust and regulatory issues. Still, if some of its 2.4 bln users get hooked, that would boost the likes of bitcoin as well as blockchain technology overall.

Millennials help JPMorgan learn from failure

6 June 2019

The $350 bln U.S. lender is closing a clumsily conceived digital account for young professionals. JPMorgan has made bigger gaffes, and companies like Alphabet make a feature of their mistakes. The ability to weather flops is why innovation favors those with big balance sheets.

Cloud stocks have drifted too high

6 June 2019

Software as a service deserves some of its hype. But high valuations for companies like Veeva and Shopify can make missteps into disasters. Look at the plunging share prices of Cloudera and Pivotal. It doesn’t help that scrutiny of big tech has dulled the prospect of M&A exits.

Fiat-Renault M&A collapse creates losers all round

6 June 2019

The Italian-American carmaker withdrew a merger offer after the French state sought to delay a decision. The companies lose 5 bln euros of synergies, while Renault and Nissan remain stuck in a frayed alliance. Paris has flubbed an opportunity to show its pro-business credentials.

Wells Fargo CEO hunt is chicken-and-egg dilemma

6 June 2019

The scandal-racked U.S. lender may make its interim chief permanent, a suggestion it can’t find an outsider to take the job. Wells Fargo needs a strong boss to mend regulatory fences – but with so much hostility, it may be hard and expensive to get someone who fits the bill.

SEC’s new conflict rule does investors few favors

5 June 2019

The U.S. securities watchdog is tightening conduct standards a bit for brokers while loosening them for investment advisers. The industry-friendly fudge leaves investors to fend for themselves. Sharp dissent within the commission underscores the weakness of that approach.

Canada is caught in America’s trade-war crossfire

5 June 2019

President Donald Trump’s threat to impose tariffs on Mexico puts at risk the new version of the three-way NAFTA trade deal. Canada’s arrest of Huawei’s CFO at America’s request upset China. And its uranium exports may now face levies, too. Ottawa can’t catch a break.

Fed could do worse than mimic Donald Rumsfeld

5 June 2019

George W. Bush’s defense secretary famously talked of known knowns, known unknowns, and unknown unknowns. The U.S. central bank, seeking better communication, could borrow the categories. They help explain why markets now expect interest-rate cuts while Fed rate-setters don’t.

Thrice-ditched Aussie telco has its work cut out

5 June 2019

Swedish fund EQT has dropped its toppy $2.3 bln bid for Vocus after due diligence. Shares dropped 20%. It’s the third financial buyer to walk since 2017. It casts doubt on the target’s efforts to integrate deals. New boss Kevin Russell has to find a way to dial up confidence.

Uber analysts ride dreams to common destination

4 June 2019

They expect the $70 bln ride-hailing app to lose money for years but see various grounds for optimism, from cross-platform synergies to flying cars to demographics. Yet most roads lead to a forecast price upside of around 25%. It’s Wall Street’s form of herd immunity.

Mexico tariffs may lead to more bills for America

4 June 2019

The southern neighbor hopes to avoid import taxes by doing more to stop migrant crossings. But a weak economy and lower oil revenue have already forced Mexico to cut its 2019 budget. President Donald Trump may need to stump up even more aid to help the country meet his demands.

China’s censors expose a truth about corporate JVs

4 June 2019

Reuters’ 30th anniversary coverage of Tiananmen was blocked by Blackstone-backed partner Refinitiv in China amid pressure from Beijing. The $20 bln data provider’s priorities deviate from those of the news publisher. It’s a prime example of how partnerships can be strained.