Morning News: February 9, 2017
Posted by Eddy Elfenbein on February 9th, 2017 at 6:54 am

Can Golf Diplomacy Help Abe Score Win-Win on Trade And Defense?

Is A Strong Or Weak Dollar Good For The U.S.? The $16 Trillion Question

What You Need To Know About Denied RALs & Other Tax Refund Loan Questions

The Unanswered Question in Trump’s Announcement of a $7 Billion Intel Investment

Snapchat Parent’s IPO Filing Omits Monthly Data

Iger Tries Hard to Tease Disney’s On-Demand Sports Service to Soothe ESPN Worries

Judge, Citing Harm to Customers, Blocks $48 Billion Anthem-Cigna Merger

Boeing Wins $13.8 Billion Wide-Body Jet Order From Singapore Air

Infosys Founders Said to Question Payments for CEO, Executives

Nokia Seeks t Buy Finnish Telecom Firm Comptel for $370 Million

New York Times Offers Free Spotify Service to Boost Subscribers

Whole Foods to Shrink Store Count for First Time Since Recession

The World According to a Free-Range Short Seller With Nothing to Lose

Josh Brown: This Is What We’re Dealing With

Cullen Roche: The Biggest Myths in Investing, Part 4 – Indexing is Average

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Fiserv Earns $1.16 per Share
Posted by Eddy Elfenbein on February 8th, 2017 at 4:12 pm

After the bell, Fiserv (FISV) reported Q4 earnings of $1.16 per share which matched the Street’s consensus. For the year, the company made $4.43 per share.

Adjusted operating margin expanded 140 basis points to 32.1 percent in the fourth quarter and 50 basis points to 32.2 percent for the full year compared to the prior year periods.

Free cash flow increased 8 percent to $1.08 billion for the full year compared to the prior year. Cash distributions from StoneRiver of $151 million in 2016 related to the sale of a business interest have been excluded from the company’s free cash flow results.

Sales performance increased 22 percent in the fourth quarter and 21 percent for the full year compared to the prior year periods.

The company repurchased 11.9 million shares of common stock for $1.20 billion in 2016, which included 2.6 million shares of common stock for $265 million in the fourth quarter. The company announced a new 15 million share repurchase authorization in the quarter and had 20.5 million remaining shares authorized for repurchase as of December 31, 2016.

Fiserv expects its internal revenue to grow between 4% and 5%, and EPS to range between $5.03 and $5.17. That would be a growth rate of 14% to 17%. Wall Street had been expecting $4.97 per share.

Earnings from Axalta and Cognizant
Posted by Eddy Elfenbein on February 8th, 2017 at 10:54 am

We had two more Buy List earnings reports this morning. Axalta Coating Systems (AXTA) reported earnings of 28 cents per share which was one penny below estimates. Quarterly revenues rose 2% to $1.03 billion, which was a little better than estimates. In constant currency, sales rose 5.6%.

Despite the miss, this was a decent quarter for Axalta.

“Axalta’s 2016 financial period ended on a strong note, with fourth quarter net sales and operating performance slightly exceeding the expectations set in October, driven by volume and favorable product mix. For the full year, we also met our key objectives in terms of financial and operating performance, despite a somewhat greater foreign currency headwind,” said Charles W. Shaver, Axalta’s Chairman and Chief Executive Officer. “We are proud of the progress we made this year, including achieving positive growth in a tough global economy, successfully executing on our M&A strategy, meeting our leverage target ahead of plan, and improving productivity through our Axalta Way initiatives. Key milestones were also met in new product technology introduction, refinancing our capital structure, and progressing our product globalization and commercial excellence objectives. We look forward to ongoing momentum in each of these areas in 2017.”

The company doesn’t provide EPS guidance, but here are the numbers they’re expecting for 2017:

• Net sales growth of 1-3% as-reported; 4-6% ex-FX, including acquisition contribution of 2-3%
• Adjusted EBITDA of $930-980 million
• Interest expense of ~$150 million
• Income tax rate, as adjusted, of 22-24%
• Free cash flow of $440-480 million
• Capital expenditures of ~$160 million
• Depreciation and amortization of ~$335 million
• Diluted shares outstanding of 246-249 million

The stock is currently down about 1.6%.

Cognizant Technology Solutions (CTSH) said it made 87 cents per share last quarter, which beat estimates by one penny. For the year, Cognizant made $2.55 per share.

They company offered Q1 guidance of 83 cents per share, and full-year guidance of $3.63 per share. That’s a bit below expectations.

But the more important news is that the company has reached an agreement with Elliott Management. They’re adding three new board members from Elliott. Cognizant also plans to return $3.4 billion to shareholders in the next two years. The company currently has a bank account of more than $2 billion. They also plan to start a dividend of 15 cents per share in Q2.

The stock is up about 4% today.

Morning News: February 8, 2017
Posted by Eddy Elfenbein on February 8th, 2017 at 7:09 am

IMF Revives Greek Euro-Exit Warning Amid Deadlocked Bailout Talks

Bonds Face Worst Loss Since 2013 as India Signals End to Easing

Chinese FX Reserve Crosses Risky Line in Sand

Oil Prices Fall On Bloated U.S. Fuel Inventories, Stalling China Demand

Saudi Aramco Picks Moelis to Advise on Biggest IPO

Dodd-Frank Rollback May Fall Short of G.O.P. Hopes

Why Silicon Valley Wouldn’t Work Without Immigrants

German Automakers Step Up to Silicon Valley Challenge

Why Some Investors May Boycott Snapchat’s IPO

Maersk Slumps as It Unveils Second Loss Since World War II

Japan’s Sharp May Begin Construction on $7 Billion Plant Before June 30

This Japanese Billionaire CEO Expects to Benefit from Trump’s Deregulation

Oreo Maker Mondelez’s Sales, Profit Miss Estimates

Jeff Carter: The Series B Investor

Howard Lindzon: The White House is Spamming Me and Apple is Planning on Leaving Planet Earth

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Should the S&P’s Quiet Streak Affect Your Investing Strategy?
Posted by Eddy Elfenbein on February 7th, 2017 at 7:09 pm

Apple Surges to Two-Year High
Posted by Eddy Elfenbein on February 7th, 2017 at 3:54 pm

I was on CNBC’s “Trading Nation” this afternoon. True story. I was in the green room at the DC studio. I heard a voice behind me say, “nice tie.” It was Howard Dean.

I said, “it’s from Vermont!”

He said, “really?”

I told him I was kidding. He said it didn’t look like a Vermont tie.

Anyway, here’s my tie and me on Apple.

IntercontinentalExchange Beats and Raises Dividend
Posted by Eddy Elfenbein on February 7th, 2017 at 11:21 am

Good news this morning from IntercontinentalExchange (ICE). The stock exchange operator reported Q4 earnings of 71 cents per share, which was two cents better than estimates. Revenues rose 30.1% to $1.14 billion, which matched estimates.

“Amidst a volatile and dynamic environment, we delivered our eleventh consecutive year of record revenue,” said ICE Chairman and CEO Jeffrey C. Sprecher. “Despite the challenges of market volatility driven by geopolitics, we achieved our objectives by working closely with our customers across trading, risk management and data to again deliver strong revenue growth, margin expansion and double-digit profit increases. We are excited about collaborating with our customers in 2017 given the range of ways we are working to serve their evolving trading, listing, data and risk management needs.”

Scott A. Hill, ICE CFO, added: “In the first year of our integration of Interactive Data, we surpassed our synergy target and met our ambitious revenue growth target while expanding margins. We also generated record operating cash flow of $2.1 billion in 2016, which enabled us to reduce our debt by approximately $1 billion, announce our third double digit increase in our dividend, and increase our share repurchases for 2017. Our strategy, execution, and disciplined capital allocation has led to significant value creation and future growth opportunities.”

ICE also raised their quarterly dividend from 17 to 20 cents per share. For 2017, ICE sees revenues adjusted for currency rising by 6%.

Morning News: February 7, 2017
Posted by Eddy Elfenbein on February 7th, 2017 at 6:57 am

European Central Bank to Trump: ‘We Are Not Currency Manipulators’

Greek Two-Year Yields Approach 10% Amid IMF Standoff With EU

Euro, European Bonds Unnerved By French Political Jitters

China Jan FX Reserves Fall Below $3 Trillion For First Time In Nearly 6 Years

Wall Street Is Confused By President Trump’s Memo on the Broker Advice Rule

Trump’s H1-B Visa Crackdown Threatens Cutting-Edge U.S. Medicine

Offshore Wind Moves Into Energy’s Mainstream

Honda and Hitachi Are Forming an Electric Vehicle Motor Company

BP Misses Fourth Quarter Profit Estimate as Refining Margins Offset Higher Oil Prices

Tyson Reveals Subpoena Linked To Alleged Price Fixing

Rio Gifts India Diamond Mine to Madhya Pradesh Government

Uber Hires Veteran NASA Engineer to Develop Flying Cars

Snapchat Thinks Its Ads Are Better Than TV’s — Here’s Why

Josh Brown: The Riskalyze Report: The Untold Story of 2017 So Far

Roger Nusbaum: A Job Report For Everybody!

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HBO’s Warren Buffett Documentary
Posted by Eddy Elfenbein on February 6th, 2017 at 3:32 pm

34 Day Streak of Less than 1% Ranges
Posted by Eddy Elfenbein on February 6th, 2017 at 12:00 pm

The S&P 500 has gone 34 days in a row with the distance between the daily high and low being less than 1%.

This looks to be the longest such streak in 40 years.