Coty’s makeover is stuck at foundation stage 26 Aug 2021 New CEO Sue Nabi, who spent 20 years at L’Oreal, has cut the $7 bln U.S. beauty firm’s costs and revamped management. Pivoting CoverGirl to middle America also looks smart. Yet shrinking sales and $5 bln of net debt suggest Coty’s chunky discount to its French rival will persist.
Capital Calls: Pennies matter to dollar stores 26 Aug 2021 Concise views on global finance: Low-margin U.S. retailers are suffering from supply-chain cost inflation, a direct hit to their business model.
Maersk’s green ships have first-mover disadvantage 26 Aug 2021 The $53 bln container giant is buying eight vessels powered by carbon-neutral methanol. Maersk gets a green halo, and customers could shoulder its increase in costs. The catch is that clean fuel alternatives currently in development are likely to be cheaper, and greener.
DWS greenwash probe could be ESG tipping point 26 Aug 2021 The German asset manager’s shares slumped 12% amid a U.S. investigation into alleged overstatement of its green credentials. A lack of consistent ESG metrics and terminology is a long-running, sector-wide problem. The desire to avoid similar attention could fast-track a cleanup.
Xiaomi is primed to scale Mount Microchip 26 Aug 2021 The $82 bln Chinese company shipped 53 mln handsets in the second quarter, overtaking Apple to become the world’s No. 2 producer behind Samsung. With greater heft, boss Lei Jun’s ambitions in semiconductors should be within reach soon. Favourable policies from Beijing will help.
Viewsroom: China’s push for common prosperity 26 Aug 2021 Markets have been hit by a series of crackdowns in private tutoring, data security and more. Underlying this is Beijing’s effort to limit rich excesses and boost middle-class wealth, which could curb the performance of the country’s biggest and best-known private companies.
Pork feud stirs up another giant China risk factor 26 Aug 2021 WH Group is embroiled in a nasty clash with the octogenarian chairman’s son, who alleged financial misdeeds after being ousted. Denials didn’t prevent $2 bln of lost market value. Succession quandaries in graying corporate China add one more item to a growing investor checklist.
Old-timers’ property brawl needs knockout blow 25 Aug 2021 Barry Sternlicht’s Starwood is trading bids with Chicago veteran Sam Zell for $2 bln U.S. industrial real-estate outfit Monmouth. The increments are too small to be decisive. The Monmouth board is sticking with Zell for now, but it's time for a best and final punch from each.
Dating outscores gaming in app store showdown 25 Aug 2021 A U.S. judge is considering an antitrust suit against Apple’s online shop as lawmakers pile pressure on the iPhone maker and rival Google. Despite games dominating their outlets’ $111 bln in annual sales, a cut in the tech giants’ 30% fee may boost daters like Match more.
Financially isolating Afghanistan is pointless 25 Aug 2021 Much of the budget has evaporated with the abrupt halt on aid, and an effective U.S. freeze on central bank reserves is compounding the chaos. An economic collapse will only fan extremism and refugee outflows. Targeted support is urgently needed to preserve development gains.
Capital Calls: Delta Air Lines’ vaccine stick 25 Aug 2021 Concise views on global finance: The U.S. carrier will charge unvaccinated stateside employees $200 per month towards healthcare. Adding some push to the pull of incentives makes sense.
KKR’s Aussie lenders are short of investor credit 25 Aug 2021 Pepper Money and Latitude have shown they can weather pandemic lockdowns and thrive thereafter. Even so, the two non-banks backed by the buyout shop are trading below their IPO prices earlier this year. Some caution is warranted, but the discount to bigger peers looks overdone.
Pinduoduo’s largesse masks bigger profit problem 25 Aug 2021 China's $124 bln e-commerce group swung into the black in the quarter as it reduced subsidies. But slowing growth, alongside a $1.5 bln philanthropic pledge in rural projects, suggest that is not sustainable. Beijing’s crackdown on the sector has also emboldened rivals like JD.
Federer injects Swiss topspin into On sneaker IPO 24 Aug 2021 The trainer maker favored by The Rock and First Lady is bypassing Zurich for New York, with a mooted valuation of some $6 bln, a pack-leading 7 times sales. Athleisure wear is a crowded space, but On is growing fast. Like its marathoning clients, it’ll need endurance on its side.
Santander performs an acceptable U.S. U-turn 24 Aug 2021 The Spanish bank is paying $2.5 bln to buy out a 20% minority stake in its profitable U.S. consumer financing arm. It only listed the business in 2014, and has had to hike its offer price. But Santander is doing the same deals elsewhere, and it makes capital and earnings sense.
Capital Calls: Cook defeats Apple crumble risk 24 Aug 2021 Concise views on global finance: The CEO replaced the ailing Steve Jobs exactly 10 years ago. Despite fears at the time, Cook’s must be one of the most lucrative successions of all time for shareholders.
Beijing and ByteDance are killing a video-app star 24 Aug 2021 Kuaishou has shed $190 bln from a peak struck shortly after its February listing. Its adjusted net loss is forecast to hit $3 bln this year as it struggles with regulators and TikTok’s owner. Barring a turnaround, it may prove to be China tech's shortest-lived flash in the pan.
Branson’s second space SPAC draws awkward parallel 23 Aug 2021 Virgin Orbit, an offshoot of Galactic, inked a blank-cheque deal valuing it at $3.2 bln. With just three successful satellite launches, the projections are a leap of faith. But Orbit is using Galactic’s inflated multiples for validation. It underscores SPACs’ otherworldliness.
Capital Calls: Pfizer M&A, Uber driver status 23 Aug 2021 The drugmaker has agreed to acquire Trillium Therapeutics for $2.3 billion, looking to its broader post-coronavirus strategy; a California judge has struck down a law exempting tech companies from treating drivers as full employees, complicating their push to keep costs down.
China’s middle-class push has luxury silver lining 23 Aug 2021 President Xi Jinping’s plans to rein in the super-rich may mean more, not less, conspicuous consumption. With China accounting for 40% of designer demand, LVMH and others are nervous. But wealth reallocation may swell the ranks of bourgeoisie. The luxury selloff looks excessive.