Author Archive

• Earnings from Fiserv and Silgan
  Eddy Elfenbein, April 27th, 2022 at 11:49 am

  Hectic morning today in the markets. Stocks started off well, then dipped lower and now are back up again. I see that shares of Twitter are down to $48 per share. Perhaps there are some deal doubters out there.

  We had two Buy List earnings report this morning. Fiserv (FISV) earned $1.40 per share. That’s up 20% from last year and it topped Wall Street by five cents. Adjusted revenue grew by 10% to $3.91 billion. Organic revenue growth was up 11%.

  Fiserv stuck by its full-year forecast of $6.40 to $6.55 per share. That works out to growth of 15% to 17%.

  Also this morning, Silgan Holdings (SLGN) said it made 78 cents per share for its Q1. That was two cents more than estimates. Business is going so well that Silgan raised its full-year guidance range to $3.90 to $4.05 per share. The previous range was $3.80 to $4.00 per share. In February, the company bumped up its quarterly dividend from 14 to 16 cents per share.

  AFLAC and FICO will report after the close.

• Morning News: April 27, 2022
  Eddy Elfenbein, April 27th, 2022 at 7:07 am

  Russia Stops Gas to Poland and Bulgaria, Opens New Front in Economic War

  Can Japan Keep the Lights On? The Ukraine War Upends a Big Energy Bet.

  Four European Gas Buyers Made Ruble Payments to Russia

  Oil Exporters Bagging $818 Billion Windfall Are Cautioned by IMF

  Why U.S. Oil Companies Aren’t Riding to Europe’s Rescue

  With Inflation, Gold Notes and Cards Find Their Way into America’s Wallet

  Stock Market Meltdowns Have FAANGs Looking Increasingly Toothless

  Alphabet Earnings Show Slowing Sales Growth on Digital-Ad Tumult

  Facebook Parent Meta Expected to Post Slowest Revenue Growth Since IPO

  Microsoft Earnings Rose Last Quarter With Demand for Cloud Services

  Elon Musk Bets Twitter Users Will Like a More Freewheeling Platform

  Musk Is a Problem Masquerading as a Solution

  Hot Job Market, an Economic Relief, Is a Wall Street Worry

  Deutsche Bank Joins UBS in Flagging Challenge of Soaring Pay

  The 400 Airplanes That Russia Seized Have Become an Epic Insurance Struggle

  The Biden Student Debt Question: Will He or Won’t He?

  Be sure to follow me on Twitter.

• Morning News: April 26, 2022
  Eddy Elfenbein, April 26th, 2022 at 7:08 am

  Nuclear Power Could Help Europe Cut Its Russia Ties, but Not for Years

  Beijing Starts Testing 20 Million to Try to Avoid a Lockdown Like Shanghai’s

  Supply Chain Chaos Roars Back as Covid Grips China

  The $67 Billion Tariff Dodge That’s Undermining U.S. Trade Policy

  Inflation Got You Down? At Least You Don’t Live in Argentina.

  Real Yields Wade Toward Positive Territory, Denting Stocks

  Fidelity to Allow Retirement Savers to Put Bitcoin in 401(k) Accounts

  Senate Tees Up Votes on Biden’s Fed Nominees

  Twitter Takeover Was Brash and Fast, With Musk Calling the Shots

  Twitter Employees Search for Answers as Musk Takeover Becomes Reality

  Musk’s Twitter Deal Heralds Potential Social-Media Shift

  UBS Beats Expectations for the First Quarter; Continues to Reduce Russia Exposure

  Google Investors Warn Saudi Arabia Data Project Could Be Used By ‘Top Hitmen’

  Facebook Is Opening Its First Showroom to Sell VR Headsets

  Ford Hurries Out F-150 Lightning to Grab Share of Electrics Market

  PepsiCo Beats Q1 Profit Forecast, Lifts 2022 Sales Outlook On Snacks Strength

  Times Square Plots Its Comeback, and It Looks Like Las Vegas

  Be sure to follow me on Twitter.

• Your Terms Are Acceptable
  Eddy Elfenbein, April 25th, 2022 at 3:07 pm

  It really happened. Twitter’s board has unanimously accepted Elon Musk’s offer. The stock has been halted. From the NYT:

  Elon Musk struck a deal on Monday to buy Twitter for roughly $44 billion, in a victory by the world’s richest man to take over the influential social network frequented by world leaders, celebrities and cultural trendsetters.

  Twitter agreed to sell itself to Mr. Musk for $54.20 a share, a 38 percent premium over the company’s share price this month before he revealed he was the firm’s single largest shareholder. It would be the largest deal to take a company private — something Mr. Musk has said he will do with Twitter — in at least two decades, according to data compiled by Dealogic.

  “Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated,” Mr. Musk said in a statement announcing the deal. He said he wanted “to make Twitter better than ever.”

  Wow. I didn’t think it was really going to happen. There’s no getting around the fact that Twitter simply isn’t that profitable. The company is due to report earnings on Thursday. Wall Street had been expecting earnings of three cents per share.

• Otis Earns 77 Cents per Share
  Eddy Elfenbein, April 25th, 2022 at 9:39 am

  We had more good earnings news this morning. Otis Worldwide (OTIS) reported Q1 earnings of 77 cents per share. That was up 6.9% over last year and it was three cents more than expectations. Organic sales rose 3.1% to $3.4 billion.

  The quarter was even stronger than it may appear. Q1 cash flow from operations was $504 million. Free cash flow was $474 million, or 152% of net income.

  “Otis delivered a strong first quarter with broad based growth in New Equipment orders and maintenance portfolio units, nearly 6% Service organic sales growth, 30 basis points of Otis adjusted margin expansion and high-single digit adjusted EPS growth. In addition, year-to-date, we have made progress on our capital allocation strategy by successfully increasing our ownership in Zardoya Otis that will result in its automatic delisting in early May, repaying $500 million of debt and returning cash to shareholders through $200 million in share repurchases and a more than 20% increase in our dividend,” said Judy Marks, Chair, CEO & President. “These achievements, and the progress we are making on our ESG initiatives, demonstrate the strength of our strategy, our ability to execute and the resilience of our business. Looking ahead, despite the intensifying macro challenges, including the impact from the crisis in Ukraine, we expect to achieve 3 to 4% organic sales growth and 10% adjusted EPS growth, at the midpoint.”

  During the quarter, Otis bought back $200 million of stock and repaid $500 million of debt. Otis’s operating profit expanded from 22.4% to 22.9%.

  Otis also revised its full-year outlook, excluding business in Russia. The company now expects sales of $14.1 to $14.3 billion and EPS of $3.22 to $3.27. The previous range was $3.20 to $3.30 per share.

  The stock has been as high as 3.5% today.

• Morning News: April 25, 2022
  Eddy Elfenbein, April 25th, 2022 at 7:01 am

  Ukraine’s Grim Economic Toll From War Confronts World Governments

  Russia’s War Is Bringing the Dirtiest Fuel Back from the Dead

  Gas-Engine Bans Drive Landscapers Toward Electric Mowers and Blowers

  Oil Sinks Below $98 as China’s Lockdowns Imperil Demand Outlook

  Warren Buffett Faces Renewed Climate Change Challenge by Investors

  Indonesia’s Palm Oil Export Ban Leaves Global Buyers With No Plan B

  Covid Outbreak in Beijing Prompts Panic Buying and Lockdown Fears

  Covid Lockdowns Revive the Ghosts of a Planned Economy

  Global Auditing Firms Struggle to Leave Russia

  The Fed Wants to Raise Rates Quickly, but May Not Know Where to Stop

  U.S. Trucking Downturn Foreshadows Possible Economic Gloom

  Some Job-Switchers Are Having Second Thoughts

  Crypto Industry Can’t Hire Enough Lawyers

  Twitter Warms to Elon Musk’s $43 Billion Takeover as Talks Proceed

  Inside the Implosion of CNN+

  Coca-Cola Earnings Beat Wall Street Estimates As Revenue Jumps 16%

  Be sure to follow me on Twitter.

• Otis Raises Its Dividend by 20.8%
  Eddy Elfenbein, April 22nd, 2022 at 4:20 pm

  After the closing bell, Otis Worldwide (OTIS) raised its quarterly dividend from 24 cents to 29 cents per share.

  The Otis Worldwide Corporation (NYSE: OTIS) Board of Directors today declared a quarterly dividend of $0.29 per share of Otis’ common stock, which represents a 20.8% increase. The dividend will be payable on June 10, 2022, to shareholders of record at the close of business on May 20, 2022.

  “Today’s dividend increase demonstrates our commitment to disciplined capital management and our confidence in future cash flow growth,” said Judy Marks, Otis Chair, CEO and President. “We have now raised the dividend by 45% since becoming a public company and will continue to drive value creation for our customers, colleagues, and shareholders.”

• The S&P 500 Drops Below 4,400
  Eddy Elfenbein, April 22nd, 2022 at 11:07 am

  The S&P 500 has dipped below its low from the past month. We had a nice rally during the latter half of March, and now we seem to be giving it back.

  

  Not everyone is feeling the pain. Yesterday, the Consumer Staples ETF (XLP) made a new 52-week high.

  Yesterday, Jerome Powell basically sealed the deal on the Fed raising rates by 0.5% at its next meeting.

  From the WSJ:

  “It is appropriate in my view to be moving a little more quickly” than the Fed has in the recent past, Mr. Powell said Thursday. “I also think there’s something in the idea of front-end loading” those moves.

  The odds are now very likely that the Fed raises by 0.5% in two weeks, and then by 0.75% in mid-June.

• Morning News: April 22, 2022
  Eddy Elfenbein, April 22nd, 2022 at 7:02 am

  Plunge in China’s Markets Intensifies as Yuan Hits One-Year Low

  Expat Bankers Fleeing Hong Kong See No Easy Escape to Singapore

  Russian Oligarchs’ Billions Prove Hard for Investors to Shake Off

  Budweiser Brewer Pulls Out of Russia as Multinationals Weigh Options

  Ukraine Sounds Alarm on Chinese Drones, Opening Skies to U.S. Startups

  As Europe Approves New Tech Laws, the U.S. Falls Further Behind

  Dollar’s Rally May Be Nearing ‘Tipping Point’ As Fed Readies Big Hikes

  Fed’s Powell Seals Expectations of Half-Point Rate Rise in May

  Fewest Americans Collecting Jobless Aid Since 1970

  Disney to Lose Special Tax Status in Florida Amid ‘Don’t Say Gay’ Clash

  CNN+ Streaming Service Will Shut Down Weeks After Its Start

  Musk Tears Up Buyout Playbook With $46.5 Billion Twitter Financing

  Companies Try to Sell Videogaming as the Next Big Advertising Channel

  What You Don’t Know About Amazon

  Netflix, Facing Reality Check, Vows to Curb Its Profligate Ways

  France Issues International Arrest Warrant for Carlos Ghosn

  Be sure to follow me on Twitter.

• Morning News: April 21, 2022
  Eddy Elfenbein, April 21st, 2022 at 7:07 am

  Russian Oil Flows, But Increasingly Under the Radar

  For Oil Refiners, Now Is the Summer of Distillate Content

  Hunger and Blackouts Are Just the Start of an Emerging Economy Crisis

  How Inflation Has Shrunk Your Dollar

  Fed’s Daly Calls for ‘Expeditious’ Rate Increases to End Year at Neutral Levels

  Zero to Neutral in 9 Months Marks a Defining Pivot for Fed, Powell

  Tech Wage Inflation Puts Pressure on Companies

  Tesla Posts Record $3.3 Billion Quarterly Profit

  Tesla’s Stock Stands Apart From the Growth Pack

  Why Volkswagen Wants to Be Relevant in America Again

  Lotus Adds an S.U.V., With Eyes on Mainstream Appeal

  Ackman Loses More Than $430 Million on 3-Month Netflix Bet

  Netflix’s Stumble Could Be a Warning Sign for Streaming Industry

  U.S. Home Prices Hit a Record of $375,300 in March

  TurboTax’s Fight Against Free Tax Filing

  Goldman Sachs to Scrap Free Car Rides for Bankers — A Day After Scrapping Free Lunch

  Be sure to follow me on Twitter.