Broker disruption can grow beyond housing 1 Nov 2023 A $1.8 bln verdict against real estate agents could cut into commissions and deflate sky-high home prices. Industries with similar middlemen were already disrupted. Residential brokers are due for a reckoning. Others, like investment banking, could use dismantling, too.
Aussie winemaker ferments risky US deal vintage 1 Nov 2023 Treasury Wine is spending $900 mln on California’s fast-growing Daou. It’s the latest step in the Penfolds maker’s recovery from Chinese tariffs that corked a third of earnings. But listed US rivals have struggled. And the $5.5 bln buyer has suffered American hangovers before.
Capital Calls: Ford, Amazon 26 Oct 2023 Concise views on global finance: The loss per car at the $45 bln automaker’s electric-vehicle unit has jumped 51% in a year. So-so earnings at the $1.2 trln e-commerce giant’s cloud division beat the even lower bar set by rival Alphabet.
Hess deal would be higher-octane with cash added 25 Oct 2023 The takeover target’s rich valuation grants it a chunky stake in an enlarged Chevron. But the $53 bln merger now offers no premium and only shares in an underperforming acquiror. Chevron CEO Mike Wirth may have to bid against himself by throwing in a sweetener with hard currency.
If Amazon, why not Walmart? 25 Oct 2023 Lina Khan’s FTC argues the e-commerce giant’s dominance leaves sellers and customers little choice, even though shopping habits vary. The agency also targets common pricing strategies. By this logic, it’s hard to see what’s so different from the Walton family’s mega-retailer.
Alphabet’s present looks brighter than its future 24 Oct 2023 Revenue at the Google parent rose more than 10% for the first time since mid-2022 because of a recovery in online advertising, its bread-and-butter. But a stumble in its fast-growing cloud computing unit suggests it will be tough for Alphabet to catch up with weightier rivals.
GM earnings give its restive workers an inch 24 Oct 2023 The automaker’s strong third-quarter earnings have raised the stakes in a strike costing it $200 million a week. The union continues to push aggressively. But with Detroit’s gas guzzlers doing relatively well, a tough-but-survivable compromise seems possible.
Capital Calls: P&G’s pricing power 18 Oct 2023 Concise views on global finance: The $350 bln maker of Pampers diapers and Pantene shampoo charged another 7% more on average for its stable of products, but it can afford to keep squeezing shoppers because of the $1.1 trln Americans have in the bank.
Rite Aid can do more wrong in bankruptcy 17 Oct 2023 Ill-advised acquisitions, mismanagement, and the growth of more diversified rivals contributed to the drugstore chain’s demise. But its role in the US opioid epidemic was the real killer. Rite Aid wants to restructure, but an eventual sale may be the end game.
Stolen genetic data points to mutating cyber risk 17 Oct 2023 Biotech firm 23andMe may have fallen victim to hackers, joining other sabotage targets Clorox and MGM. Companies can strengthen their systems, but human error plays a role too – with customers and employees as potential vulnerabilities. That adds a new front to an ongoing battle.
Rubik’s Cube owner solves eternal M&A puzzle 13 Oct 2023 After Spin Master agreed to buy toymaker Melissa & Doug for up to $1.1 bln, its shares jumped 10%. Defying screen-time culture is a risky deal game. But paying a discount to where rivals trade for a company growing faster than the market is the way to play well with investors.
Capital Calls: Birkenstock flop 11 Oct 2023 Concise views on global finance: The sandal maker took a tumble, as its shares opened more than 10% below the IPO price, leaving questions about its venue and valuation.
Pepsi has long way to go to win Ozempic challenge 10 Oct 2023 The $222 bln maker of Mountain Dew and Cheetos increased operating profit 14% after its seventh consecutive quarter of jacking up prices by at least 10%. Volume is slumping, however, and anti-obesity drugs are just starting to make their mark. Growth is bound to get tougher.
India’s consumers are surprisingly fragile 5 Oct 2023 Despite near-8% economic growth, weak demand is prompting Unilever and Nestle’s local units to launch multiple low-priced packs of soap and noodles. More official handouts, like an extension to a free food scheme, will be something for companies to both cheer and worry about.
Elon Musk’s X is a black hole of value 3 Oct 2023 Boss Linda Yaccarino is set to present her plans for the social network to bankers holding $13 bln of debt used to buy it. But X may be worth as little as $8 bln. Lead lender Morgan Stanley may have to pick up the pieces just as X threatens to consume whatever value is left.
Meta’s EU subscription looks suspiciously pricey 3 Oct 2023 The Instagram owner may allow Europeans to pay $14 a month to avoid ads. It’s hard to see many users signing up, and the price is far higher than Meta’s regional revenue per user. Regulators and courts, which effectively pushed for this outcome, may get a phantom solution.
Visa takes charge of one risk as another grows 28 Sep 2023 The payments network devised a way for banks such as JPMorgan to gradually offload their collective 20% stake, worth about $96 bln. It would help avoid a mad dash to the exit. With credit card usage, and possibly fees, rising, however, fresh legal and regulatory concerns abound.
Amazon has a poor man’s monopoly 27 Sep 2023 Trustbusters sued the $1.3 trln retailer over how it restricts merchants on its site. But it has lost ground to rivals like Walmart thanks to bad M&A and retail losses. Amazon gets the worst of two worlds: strong enough to worry regulators, vulnerable enough to concern investors.
Coty’s listing treatment is just cosmetic 26 Sep 2023 The $10 bln US-traded beauty firm is going against the tide with a dual listing in Paris. That may give it more visibility with European investors and the funds will cut its debt. But it won’t reduce the risk of its luxury clients boosting their own cosmetic and perfume arms.
Listing duo offers followers a cautious playbook 21 Sep 2023 Chip designer Arm and grocery delivery company Instacart have secured relatively successful stock launches, offering hope of a wider reopening of the IPO market. In this Viewsroom podcast, Breakingviews columnists explain how cornerstone investors and lowly valuations helped.