Online reviews company Yelp reported a net loss yesterday and has yet to report a profit since it went public in 2012. Yet its shares were up by a whopping 27% today, hitting a record high of $32.38. They even rose slightly higher in-after hours trading.
When you’re picking a company to manage your investments, the least you’d expect is that it could competently manage its own public offering. So a few eyebrows were raised when the US arm of financial services firm ING Groep lowered the price target of its IPO last week to $19.50, from a previous price range of $21 to $24 a share set in April. But that caution was ultimately rewarded, as ING US shares rose a healthy 8.2% since its debut, avoiding a Facebook-style IPO mishap. It was the second largest IPO in the US so far this year.
Intel decided to play it safe with its choice of a new CEO, picking someone who has been at the company for more than 30 years. The world’s largest chipmaker announced today that COO Brian Krzanich will be its next leader. He is replacing Paul Otellini, who announced he was stepping down last year.
In a surprising move, the US insurance arm of the Netherlands’ ING Groep priced its IPO today at $19.50, which is lower than the share range it had announced earlier. But it increased the size of the offering by one million shares to 65.2 million shares. That suggests there was good demand for what is the second largest IPO in the US so far this year, but investors thought the price should be lower.
In a mushy ad posted on YouTube last night, JC Penney is pleading for its former customers to come back. It acknowledges that the department store chain has made mistakes but says JC Penney has learned to listen to its customer, “to hear what you need to make your life more beautiful.”
UBS surprised the market yesterday with its better-than-expected profit for the first quarter. The Swiss bank has been restructuring—including cutting 10,000 jobs–to focus more on its crown jewel wealth management business. And it appears to be having a positive impact.
The numbers: Drug retail chain CVS Caremark beat analyst estimates, reporting a higher net income of $956 million on revenue of $30.76 billion. CVS shares were up by about 1.2% today.
It’s natural for governments to be protective of their homegrown companies, but the French can be particularly touchy. And it doesn’t seem to matter what the product is: From bottled water to yogurt to energy, they are all considered to be strategic assets for the French government.
The Numbers: Pfizer missed analyst profit and sales estimates, reporting earnings of $2.75 billion on revenue of $13.5 billion. Shares of the world’s biggest drugmaker were down about 3% in morning trading.
The Numbers: Protein shakes company Herbalife beat analyst estimates, posting profits of $118.9 million on sales of $1.12 billion. Company shares were up 0.26% in after hours trading.
Apple once shunned outside financial advisers. Steve Jobs was known to look down on bankers, feeling Apple didn’t need their help. But in the Tim Cook era, the company is increasingly turning to Wall Street for advice, and Apple’s go-to bank is Goldman Sachs.
The family members of Huawei Technologies CEO Ren Zhengfei apparently don’t have vision, character or ambition. That’s why Ren said none of them will become the next CEO of the Chinese telecom equipment maker. It’s a surprising acknowledgement in the world of company founders, who often make their offspring their heir apparent.
How convenient. Just before it is due to go into recess, when many members fly back to their home states, the US Congress has passed a bill that will help put air traffic controllers back on a full-time work schedule. The furlough of these controllers—the result of “sequestration,” the sweeping federal budget cuts triggered by Congress’s inability to reach a fiscal deal at the start of the year—has led to thousands of flight delays and cancellations in the US this week, and lots of tweets like this one:
The Numbers: China’s CNOOC reported that oil and gas revenue increased by 13% in the first quarter to 55.31 billion yuan ($8.9 billion). The company didn’t release its first quarter net income.
Americans are becoming more health-conscious, and so it’s not surprising that Coca-Cola and Pepsi last week both reported a drop in sales volume in sodas for North America. But chocolate-maker Hershey today reported an increase in sales for the first quarter this year. The results show sugar is still very much a part of the American diet.
With traditional Wall Street favorites like Apple falling on hard times, Amazon is one of the darlings du jour for investors. It also looks like it will continue to be one of the most expensive stocks on the S&P 500, according to its ratio of forward stock price to earnings per share as calculated by FactSet. The guidance Amazon provides later today when it reports its earnings will show whether that will hold true. A big ratio means investors expect higher earnings growth in the future. It’s also a measure of how richly or cheaply a company is valued.
Inrix, a provider of road traffic and other data, will likely go public later this year and could raise up to $100 million. The IPO from the Microsoft spinoff is highly anticipated and will showcase the potential of what’s known as big data, involving the collection and rapid analysis of large amounts of information. Other big data firms like Splunk have soared in their IPOs.
Was it only last year that Citigroup executives and board members were dealing with angry shareholders at the bank’s annual meeting? At this year’s gathering, there was still concern from investors (video) at Citi’s lagging performance. But at least they didn’t revolt like last year. The bank’s shares even went up today.
Toyota retained the top spot in global auto sales for the first quarter this year. A depreciating yen is helping Toyota and other Japanese automakers. But possible headwinds are gathering force as the territorial dispute between Japan and China over islands claimed by both countries stirs again.
Apple slightly beat analyst estimates when it reported earnings today for its fiscal second quarter. But it also said that revenue for its fiscal third quarter (the quarter we’re in currently) could be lower than the same period last year, which could mark the first time its sales have declined year-over-year in 10 years.
While the first quarter of the year is usually slow for travel, Delta and US Airways both reported profits today that beat expectations, as they did better at filling seats and having customers pay more for flights. But airlines are expecting bad news for April.
Apple investors are preparing for the worst tomorrow when the company reports earnings. It is already expected to report a drop in profit for the first time in 10 years. The big question for shareholders: Has Apple’s share price bottomed out, or is there still room to drop?
Activist investors have gone after bigger targets in recent years, showing there are no more sacred cows left in the corporate world. Companies that were once seen as untouchable, like Apple or Procter & Gamble, have come under shareholder pressure because of their lagging stock price. The latest example is Microsoft. CNBC reported today that activist investor ValueAct Capital has taken a $2 billion stake in the software giant.
The defeat of gun control legislation in the US Senate yesterday (April 18) was, paradoxically, bad for gun company stocks. Before the bill was defeated, shares in gun makers and related companies had gone up, because some people feared that new laws would put limitations on gun purchases, and had rushed out to buy weapons before those regulations took hold. But investors clearly believed that those worries would dissipate with the defeat of the gun control bill.
