Luxury companies’ largesse is born of necessity 13 Feb 2018 Kering is joining LVMH in hiking dividends. A 30 percent jump in its cash payout comes on top of the Puma stake that Gucci’s parent is handing over to shareholders. With valuations high and cash piling up, lavish generosity is needed to keep hard-to-please investors happy.
Heineken’s number two status brings marginal costs 12 Feb 2018 The Dutch brewer is one of the few global groups still increasing beer volumes. However, acquisitions will weigh on operating margins in 2018. Heineken needs to invest in its new Brazilian brands to take on market leader AB Inbev. That limits the scope for boosting profitability.
China’s prank video app is common man’s unicorn 12 Feb 2018 Kuaishou is closing in on an $18 bln valuation, just behind WeWork. The Tencent-backed startup caters to viewers who enjoy watching people stuff fireworks in their pants. Competition is fierce, and censorship intense. This fuse could burn quickly.
Newell proxy combatants share flawed strategy 9 Feb 2018 Starboard wants to replace the Elmer’s-to-Rubbermaid group’s board with a slate led by former managers of Jarden, which it bought two years ago. Newell has failed to hit targets, but Jarden’s rollup model was running out of gas too. A breakup would be a better activist ambition.
Viewsroom: The Fed’s belated Wells Fargo beating 8 Feb 2018 Chair Janet Yellen forbids the $2 trln lender from growing bigger - on her last day in the job, and 17 months after Wells’ fake-accounts scandal hit. Meanwhile, fellow financial watchdog CFPB seems to be giving hacked Equifax a free pass. Plus: how Nintendo made a comeback.
Tesco pay showdown contains a wider warning 8 Feb 2018 A claim that female shop workers should get the same wage as male warehouse staff could cost the UK grocer up to 4 billion pounds. It’s a lesser-known twist on equal pay. While retailers Asda and Sainsbury’s face similar legal challenges, all sectors may be exposed.
Yum China looks appetising despite iffy pizza 8 Feb 2018 The mainland operator of KFC grew revenue 8 pct last year and boosted operating profit by 23 pct. Pizza Hut is a work in progress, but shows signs of improvement. Overall, Yum’s spinoff strategy has delivered a straightforward and affordable bet on Chinese consumer appetite.
Wanda thriller casts Jack Ma in supporting role 6 Feb 2018 The troubled conglomerate is selling a $750 mln stake in its Chinese cinema chain to Alibaba. Dalian Wanda improves its financial picture and maybe its chances to add production to theatres. Ma, whose company just wrote down its studio investment, gets a shot to play hero.
Airshow buoyancy masks turbulence ahead 6 Feb 2018 Aviation bosses gathering in Singapore may want a serving of scepticism alongside the champagne. Rising oil prices, creaking infrastructure and too many seats will limit the gains from a regional boom in cheap flights. Full-service carriers could also hit air pockets.
CFPB scores too low on Equifax transparency 5 Feb 2018 The consumer-finance watchdog is dialing back its probe of the $15 bln U.S. credit-scoring firm’s massive data breach last year. Trump’s CFPB head says the regulator has gone too far in the past. Perhaps – but if protecting vital data isn’t its remit, he needs to explain what is.
San Miguel serves up an enticing spread 5 Feb 2018 The conglomerate run by Filipino billionaire Ramon Ang is uniting beer, liquor and food using a complex share swap. San Miguel Pure Foods, a maker of liver paste and other fare, trades below the implied $9.1 bln valuation. There are reasons to think that financial gap will close.
Ola puts SoftBank in back seat with overseas drive 5 Feb 2018 The Indian ride-hailing outfit wants a slice of the action in Australia. The intrusion into one of Uber’s strongholds will irk SoftBank, which is a big investor in both firms. The Japanese group’s minority stakes clearly are not enough to stop fights between taxi startups.
Airbnb wisely tidies up before guests arrive 1 Feb 2018 The home-rental app ruled out going public in 2018 after its finance chief abruptly quit. With positive cash flows, boss Brian Chesky doesn’t need to rush. The naming of a chief operating officer also shows Airbnb has learned from some of its Silicon Valley peers’ mistakes.
Unilever success hinges on quick house-cleaning 1 Feb 2018 The Dove soap owner is on track to meet sales and profit targets that it set after rejecting Kraft Heinz’s $143 billion bid. Its next big tasks are to pick a new head office and the next CEO. Getting both out of the way quickly will allow the company to focus on taking on rivals.
Copier companies spit out an M&A original 31 Jan 2018 Fujifilm is taking control of $8 bln Xerox, whose storied brand became a verb. The premium being paid hinges on some financial engineering of a 56-year-old joint venture. It’s an odd deal, but one that should deliver savings without straining the Japanese company's balance sheet.
Ericsson merits a dysfunctionality discount 31 Jan 2018 The Swedish telecoms-kit maker reported an operating loss for the fifth consecutive quarter and sales fell 10 percent in 2017. Boss Borje Ekholm promises an improvement this year but the core mobile market is shrinking. A valuation premium to Nordic peer Nokia is hard to justify.
H&M’s unfashionable stock demands total revamp 31 Jan 2018 The retailer’s operating profit fell by a third in the fourth quarter and operating margin has more than halved in a decade. Its valuation has fallen toward that of dowdier peers. Stopping the rot will at the least require an aggressive online strategy and more store closures.
Consoles power up Nintendo like nothing else 31 Jan 2018 A near four-fold leap in quarterly operating profit to $1.1 bln accentuates the popularity of the recently launched Switch. Some lean years fed angst about apps and IP. Like the iPhone's significance to Apple, though, what really matters to Nintendo is getting the device right.
Samsung stock split is an illusory value boost 31 Jan 2018 A plan to split its stock 50-fold, unveiled alongside detailed results, helped push the tech giant’s shares up sharply. That is puzzling: this won’t do much except entice a few more small investors. Issues like shareholder returns and corporate restructuring matter far more.
Bull market lets activists see virtue in passivity 26 Jan 2018 Bill Ackman, who lost his fight with ADP, has taken a stake in Nike but isn’t pushing for change. Dan Loeb sat back as Honeywell’s new boss ignored his advice and beat his targets anyway. Even pushy hedge funds can be tempted to simply ride the waves when a rally lifts all boats.