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STAG Industrial misses by $0.01, beats on revenue
STAG Industrial (NYSE:STAG): Q4 FFO of $0.37 misses by $0.01.
Revenue of $50.03M (+33.7% Y/Y) beats by $3.52M.
Valeant Pharmaceuticals reports Q4 results
Valeant Pharmaceuticals (NYSE:VRX): Q4 EPS of $2.58
Revenue of $2.28B (+10.7% Y/Y)
Shares +1.15% PM.
Valeant Pharmaceuticals reports Q4 results
Valeant Pharmaceuticals (NYSE:VRX): Q4 EPS of $2.58
Revenue of $2.28B (+10.7% Y/Y)
Shares +1.15% PM.
Pacific Drilling beats by $0.03, beats on revenue
Pacific Drilling (NYSE:PACD): Q4 EPS of $0.32 beats by $0.03.
Revenue of $319.74M (+59.4% Y/Y) beats by $7.49M.
Tower Semiconductor beats by $0.25, beats on revenue
Tower Semiconductor (NASDAQ:TSEM): Q4 EPS of $0.83 beats by $0.25.
Revenue of $235.29M (+74.8% Y/Y) beats by $0.31M.
Shares +6.87% PM.
Apple to invest €1.7B in new data centers
Apple (NASDAQ:AAPL) has announced a €1.7B plan to build and operate two European data centers, powering its online services, including the iTunes Store, App Store, iMessage, Maps and Siri, for customers across Europe.
Like all Apple data centers, the two 166K sq. meter facilities will run entirely on clean, renewable energy sources, and are expected to begin operations in 2017.
Good morning everyone !
S&P 500 Futures 2,102.45 -4.55 -0.22%
Gold 1,194.90 -10.00 -0.83%
Silver 16.235 -0.085 -0.52%
Copper 2.569 -0.022 -0.87%
Crude Oil 49.62 -1.20 -2.35%
Natural Gas 3.022 +0.050 +1.68%
GM Jim ...
Wait till I start shorting some stocks, it will turn green in no time ... lol
Notable earnings before Monday’s open
AER, AWI, AXL, CIE, CTB, DISH, DNOW, EDR, KOS, PACD, STAG
http://finviz.com/screener.ashx?v=211&t=,AER,AWI,AXL,CIE,CTB,DISH,DNOW,EDR,KOS,PACD,STAG
Time to get your money back ... < maybe !
How's the roof lee ?
< Confirmed: Valeant to acquire Salix for $158/share in cash
Transaction represents total EV of $14.5B.
Expected to achieve run-rate cost synergies of more than $500M within six months.
Conference call on Monday at 8:00 AM.
Press Release:
Valeant To Acquire Salix Pharmaceuticals For $158.00 Per Share In Cash
Sun February 22, 2015 4:00 PM|PR Newswire | About: VRX
LAVAL, Quebec and RALEIGH, N.C., Feb. 22, 2015 /PRNewswire/ --
Salix is the Leader in the Growing U.S. Gastrointestinal Market
Transaction Creates a New Specialty Platform for Growth
Key Promoted Products Showing Strong, Double Digit Volume Growth, Far Exceeding the Market
Expected Near-Term Approval for IBS-D Indication of Xifaxan Additional Catalyst for Future Growth
Additional Upside from Expected Approval of Relistor Oral as well as Strong Near-Term Pipeline
Transaction Represents Total Enterprise Value of Approximately $14.5 Billion
Fully Committed Financing from a Syndicate of Banks Led by Deutsche Bank and HSBC
Expected to Achieve Run Rate Cost Synergies of Greater Than $500 Million From Combined Company Cost Base Within Six Months
Synergy Estimate Does Not Include Any Benefits of Valeant's Corporate Structure
No Planned Reductions to Salix's Specialty Sales Forces or Hospital, Key Account and Field Reimbursement Teams; Optimal size of Primary Care Sales Force to be determined
Transaction Expected to Close in the Second Quarter of 2015
Expected to be Over 20% Accretive to Cash EPS in 2016
Due to Reduction of Wholesaler Inventory Levels, Modest Accretion Expected to 2015 Cash EPS
No Change Expected to Valeant's Credit Ratings
Valeant to Hold Conference Call to Discuss Salix Transaction and Fourth Quarter and Full Year 2014 Earnings at 8:00 am ET on Monday, February 23
Valeant Pharmaceuticals International, Inc. (VRX) (TSX: VRX) and Salix Pharmaceuticals, Ltd. (SLXP) today announced that they have entered into a definitive agreement under which Valeant will acquire all of the outstanding common stock of Salix for $158.00 per share in cash, or a total enterprise value of approximately $14.5 billion. The transaction was approved by the Boards of Directors of both companies.
Salix Pharmaceuticals is a widely recognized gastrointestinal market leader with a portfolio of 22 total products, including well-known prescription brands Xifaxan, Uceris, Relistor, and Apriso, as well as a strong near- term pipeline of innovative, new assets.
"Salix's market-leading gastrointestinal franchise is an ideal strategic fit for Valeant's diversified portfolio of specialty products," said J. Michael Pearson, Valeant's chairman and chief executive officer. "The growing GI market has attractive fundamentals, and Salix has a portfolio of terrific products that are outpacing the market in terms of volume growth and a promising near-term pipeline of innovative products. With strong brand recognition among specialist GI prescribers, a highly rated specialty sales force, and a significant product and commercial presence across the undertreated and underserved gastrointestinal market, this acquisition offers a compelling opportunity for Valeant to create a strong platform for growth and business development."
Thomas W. D'Alonzo, Chairman of the Board and Acting Chief Executive Officer of Salix, stated, "We are pleased to have reached an agreement with Valeant, which is a logical partner and importantly, creates immediate value for our shareholders. Combining Salix's leading market position in gastroenterology with Valeant's scale and resources will create a stronger and more diverse business committed to providing better health solutions to health care providers and their patients. We are proud of the accomplishments of our Salix team. Together, we have built our company into the leading gastrointestinal specialty pharmaceutical company, providing solutions for patients and healthcare providers. We look forward to working with the Valeant team to ensure a smooth transition."
The combination is expected to yield greater than $500 million in annual cost savings from the cost base of the combined company. Synergies are expected to be achieved within six months of close, primarily from reductions in corporate overhead and R&D rationalization, with the cost to achieve these synergies to be approximately 65%. Valeant and Salix will determine how best to integrate the two companies to leverage the combined strengths of both while ensuring a smooth and orderly transition. Consistent with Valeant's approach to integrating Bausch + Lomb, there are no planned reductions to Salix's highly rated specialty sales forces or hospital, key account and field reimbursement teams and we will determine the optimal size of Primary Care Sales Force through the integration process.
On November 6, 2014, Salix reported five to nine month wholesaler inventory levels for its top four products. Valeant has conducted extensive due diligence on Salix's stand-alone wholesaler inventory levels, stand-alone inventory work down plan, and associated potential litigation and regulatory exposure. Valeant expects to work down wholesale inventory and plans to target two months or less of wholesale inventory by year-end 2015. The net impact of the excess inventory on 2015 revenues is expected to be greater than $500 million.
Transaction Details
The acquisition is structured as an all-cash tender offer for all of the outstanding shares of Salix common stock at a price of $158.00 per share followed by a merger in which each remaining untendered share of Salix common stock would be converted into the right to receive the same $158.00 cash per share consideration as in the tender offer.
The all-cash offer will be financed through a combination of bank debt and bonds. As a result of the need to draw down inventories, EBITDA will be artificially low in 2014 and 2015, resulting in the initial net leverage ratio of approximately 5.6. Valeant is committed to reducing its net leverage ratio to be below 4.0 by the second half of 2016. As a result of the plan to reduce wholesaler inventory levels in 2015, the transaction is expected to be modestly accretive to 2015 cash EPS, but over 20% accretive to 2016 cash EPS.
Valeant does not expect any change to its credit ratings as a result of the transaction.
The transaction, which is expected to close in the second quarter of 2015, is subject to customary closing conditions and regulatory approval.
Sullivan & Cromwell LLP served as Valeant's legal counsel, and Salix was advised by Cadwalader, Wickersham & Taft LLP. Deutsche Bank and HSBC acted as financial advisors to Valeant. Centerview Partners and J.P. Morgan acted as financial advisors to Salix. Fully committed debt financing has been provided by Deutsche Bank Securities Inc., HSBC, Mitsubishi UFJ Securities (USA), Inc., DNB Bank ASA and SunTrust Robinson Humphrey, Inc.
Conference Call and Webcast Information
Valeant will host a conference call and a live Internet webcast along with a slide presentation tomorrow at 8:00 a.m. ET (5:00 a.m. PT), February 23, 2015 to discuss the acquisition of Salix and its fourth quarter financial results for 2014. The dial-in number to participate on this call is (877) 876-8393 confirmation code 90757812. International callers should dial (973) 200-3961, confirmation code 90757812. A replay will be available approximately two hours following the conclusion of the conference call through March 7, 2014 and can be accessed by dialing (855) 859-2056, or (404) 537-3406, confirmation code 90757812. The live webcast of the conference call may be accessed through the investor relations section of the Company's corporate website at www.valeant.com.
About Valeant
Valeant Pharmaceuticals International, Inc. is a multinational specialty pharmaceutical company that develops, manufactures and markets a broad range of pharmaceutical products primarily in the areas of dermatology, eye health, neurology and branded generics. More information about Valeant can be found at www.valeant.com.
About Salix
Salix Pharmaceuticals, Ltd., headquartered in Raleigh, North Carolina, develops and markets prescription pharmaceutical products and medical devices for the prevention and treatment of gastrointestinal diseases. Salix's strategy is to in-license late-stage or marketed proprietary therapeutic products, complete any required development and regulatory submission of these products, and commercialize them through the Company's 500-member specialty sales force.
Salix trades on the NASDAQ Global Select Market under the ticker symbol "SLXP".
Forward-Looking Statements
This press release may contain forward-looking statements, including, but not limited to, statements regarding the proposed acquisition by Valeant of Salix, expected timing and benefits of the transaction, and the impact of the transaction on Valeant's future cash earnings per share. Forward-looking statements may generally be identified by the use of the words "anticipates," "expects," "intends," "plans," "should," "could," "would," "may," "will," "believes," "estimates," "potential," "target," or "continue" and variations or similar expressions. These statements are based upon the current expectations and beliefs of management of Valeant and Salix and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include, but are not limited to, the risk that the acquisition will not close when expected or at all; the risk that Valeant's business and/or Salix's business will be adversely impacted during the pendency of the acquisition; the risk that the operations of the two companies will not be integrated successfully; and risks and uncertainties discussed in Valeant's and Salix's most recent annual or quarterly report and detailed from time to time in Valeant's and Salix's other filings with the Securities and Exchange Commission (the "SEC (SCUR)") and, with respect to Valeant, the Canadian Securities Administrators, which factors are incorporated herein by reference. Readers are cautioned not to place undue reliance on any of these forward-looking statements. These forward-looking statements speak only as of the date hereof. Valeant and Salix undertake no obligation to update any of these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect actual outcomes.
Additional Information
The tender offer described in this press release has not yet commenced and this communication is not a recommendation or an offer to purchase or a solicitation of an offer to sell shares of Salix. At the time the tender offer is commenced Sun Merger Sub, Inc. and Valeant will file a Tender Offer Statement on Schedule TO, containing an offer to purchase, form of letter of transmittal and related tender offer documents, with the SEC, and Salix will file a Solicitation/Recommendation Statement on Schedule 14D-9 relating to the tender offer with the SEC. Valeant and Salix intend to mail these documents to the stockholders of Salix. These documents, as they may be amended from time to time, will contain important information about the tender offer and stockholders of Salix are urged to read them carefully when they become available. Stockholders of Salix will be able to obtain a free copy of these documents, when they become available, at the website maintained by the SEC at www.sec.gov. In addition, the Tender Offer Statement and other documents that Valeant files with the SEC will be made available to all stockholders of Salix free of charge at www.valeant.com. The Solicitation/Recommendation Statement and the other documents filed by Salix with the SEC will be made available to all stockholders of Salix free of charge at www.salix.com.
Contact Information:
Valeant Investors:
Salix Investors:
Laurie W. Little
Timothy J. Creech / Michael Freeman
949-461-6002
919-862-1000
laurie.little@valeant.com
Valeant Media Contacts:
Salix Media Contacts:
Sard Verbinnen & Co
Teneo Strategy
Renee Soto/ Meghan Gavigan/Jared Levy
Stephen Cohen
212-687-8080
347-489-6602
http://photos.prnewswire.com/prnvar/20101025/LA87217LOGO
Logo - http://photos.prnewswire.com/prnh/20101025/LA87217LOGO
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/valeant-to-acquire-salix-pharmaceuticals-for-15800-per-share-in-cash-300039442.html
SOURCE Valeant Pharmaceuticals International, Inc.
< Confirmed: Valeant to acquire Salix for $158/share in cash
Transaction represents total EV of $14.5B.
Expected to achieve run-rate cost synergies of more than $500M within six months.
Conference call on Monday at 8:00 AM.
Press Release:
Valeant To Acquire Salix Pharmaceuticals For $158.00 Per Share In Cash
Sun February 22, 2015 4:00 PM|PR Newswire | About: VRX
LAVAL, Quebec and RALEIGH, N.C., Feb. 22, 2015 /PRNewswire/ --
Salix is the Leader in the Growing U.S. Gastrointestinal Market
Transaction Creates a New Specialty Platform for Growth
Key Promoted Products Showing Strong, Double Digit Volume Growth, Far Exceeding the Market
Expected Near-Term Approval for IBS-D Indication of Xifaxan Additional Catalyst for Future Growth
Additional Upside from Expected Approval of Relistor Oral as well as Strong Near-Term Pipeline
Transaction Represents Total Enterprise Value of Approximately $14.5 Billion
Fully Committed Financing from a Syndicate of Banks Led by Deutsche Bank and HSBC
Expected to Achieve Run Rate Cost Synergies of Greater Than $500 Million From Combined Company Cost Base Within Six Months
Synergy Estimate Does Not Include Any Benefits of Valeant's Corporate Structure
No Planned Reductions to Salix's Specialty Sales Forces or Hospital, Key Account and Field Reimbursement Teams; Optimal size of Primary Care Sales Force to be determined
Transaction Expected to Close in the Second Quarter of 2015
Expected to be Over 20% Accretive to Cash EPS in 2016
Due to Reduction of Wholesaler Inventory Levels, Modest Accretion Expected to 2015 Cash EPS
No Change Expected to Valeant's Credit Ratings
Valeant to Hold Conference Call to Discuss Salix Transaction and Fourth Quarter and Full Year 2014 Earnings at 8:00 am ET on Monday, February 23
Valeant Pharmaceuticals International, Inc. (VRX) (TSX: VRX) and Salix Pharmaceuticals, Ltd. (SLXP) today announced that they have entered into a definitive agreement under which Valeant will acquire all of the outstanding common stock of Salix for $158.00 per share in cash, or a total enterprise value of approximately $14.5 billion. The transaction was approved by the Boards of Directors of both companies.
Salix Pharmaceuticals is a widely recognized gastrointestinal market leader with a portfolio of 22 total products, including well-known prescription brands Xifaxan, Uceris, Relistor, and Apriso, as well as a strong near- term pipeline of innovative, new assets.
"Salix's market-leading gastrointestinal franchise is an ideal strategic fit for Valeant's diversified portfolio of specialty products," said J. Michael Pearson, Valeant's chairman and chief executive officer. "The growing GI market has attractive fundamentals, and Salix has a portfolio of terrific products that are outpacing the market in terms of volume growth and a promising near-term pipeline of innovative products. With strong brand recognition among specialist GI prescribers, a highly rated specialty sales force, and a significant product and commercial presence across the undertreated and underserved gastrointestinal market, this acquisition offers a compelling opportunity for Valeant to create a strong platform for growth and business development."
Thomas W. D'Alonzo, Chairman of the Board and Acting Chief Executive Officer of Salix, stated, "We are pleased to have reached an agreement with Valeant, which is a logical partner and importantly, creates immediate value for our shareholders. Combining Salix's leading market position in gastroenterology with Valeant's scale and resources will create a stronger and more diverse business committed to providing better health solutions to health care providers and their patients. We are proud of the accomplishments of our Salix team. Together, we have built our company into the leading gastrointestinal specialty pharmaceutical company, providing solutions for patients and healthcare providers. We look forward to working with the Valeant team to ensure a smooth transition."
The combination is expected to yield greater than $500 million in annual cost savings from the cost base of the combined company. Synergies are expected to be achieved within six months of close, primarily from reductions in corporate overhead and R&D rationalization, with the cost to achieve these synergies to be approximately 65%. Valeant and Salix will determine how best to integrate the two companies to leverage the combined strengths of both while ensuring a smooth and orderly transition. Consistent with Valeant's approach to integrating Bausch + Lomb, there are no planned reductions to Salix's highly rated specialty sales forces or hospital, key account and field reimbursement teams and we will determine the optimal size of Primary Care Sales Force through the integration process.
On November 6, 2014, Salix reported five to nine month wholesaler inventory levels for its top four products. Valeant has conducted extensive due diligence on Salix's stand-alone wholesaler inventory levels, stand-alone inventory work down plan, and associated potential litigation and regulatory exposure. Valeant expects to work down wholesale inventory and plans to target two months or less of wholesale inventory by year-end 2015. The net impact of the excess inventory on 2015 revenues is expected to be greater than $500 million.
Transaction Details
The acquisition is structured as an all-cash tender offer for all of the outstanding shares of Salix common stock at a price of $158.00 per share followed by a merger in which each remaining untendered share of Salix common stock would be converted into the right to receive the same $158.00 cash per share consideration as in the tender offer.
The all-cash offer will be financed through a combination of bank debt and bonds. As a result of the need to draw down inventories, EBITDA will be artificially low in 2014 and 2015, resulting in the initial net leverage ratio of approximately 5.6. Valeant is committed to reducing its net leverage ratio to be below 4.0 by the second half of 2016. As a result of the plan to reduce wholesaler inventory levels in 2015, the transaction is expected to be modestly accretive to 2015 cash EPS, but over 20% accretive to 2016 cash EPS.
Valeant does not expect any change to its credit ratings as a result of the transaction.
The transaction, which is expected to close in the second quarter of 2015, is subject to customary closing conditions and regulatory approval.
Sullivan & Cromwell LLP served as Valeant's legal counsel, and Salix was advised by Cadwalader, Wickersham & Taft LLP. Deutsche Bank and HSBC acted as financial advisors to Valeant. Centerview Partners and J.P. Morgan acted as financial advisors to Salix. Fully committed debt financing has been provided by Deutsche Bank Securities Inc., HSBC, Mitsubishi UFJ Securities (USA), Inc., DNB Bank ASA and SunTrust Robinson Humphrey, Inc.
Conference Call and Webcast Information
Valeant will host a conference call and a live Internet webcast along with a slide presentation tomorrow at 8:00 a.m. ET (5:00 a.m. PT), February 23, 2015 to discuss the acquisition of Salix and its fourth quarter financial results for 2014. The dial-in number to participate on this call is (877) 876-8393 confirmation code 90757812. International callers should dial (973) 200-3961, confirmation code 90757812. A replay will be available approximately two hours following the conclusion of the conference call through March 7, 2014 and can be accessed by dialing (855) 859-2056, or (404) 537-3406, confirmation code 90757812. The live webcast of the conference call may be accessed through the investor relations section of the Company's corporate website at www.valeant.com.
About Valeant
Valeant Pharmaceuticals International, Inc. is a multinational specialty pharmaceutical company that develops, manufactures and markets a broad range of pharmaceutical products primarily in the areas of dermatology, eye health, neurology and branded generics. More information about Valeant can be found at www.valeant.com.
About Salix
Salix Pharmaceuticals, Ltd., headquartered in Raleigh, North Carolina, develops and markets prescription pharmaceutical products and medical devices for the prevention and treatment of gastrointestinal diseases. Salix's strategy is to in-license late-stage or marketed proprietary therapeutic products, complete any required development and regulatory submission of these products, and commercialize them through the Company's 500-member specialty sales force.
Salix trades on the NASDAQ Global Select Market under the ticker symbol "SLXP".
Forward-Looking Statements
This press release may contain forward-looking statements, including, but not limited to, statements regarding the proposed acquisition by Valeant of Salix, expected timing and benefits of the transaction, and the impact of the transaction on Valeant's future cash earnings per share. Forward-looking statements may generally be identified by the use of the words "anticipates," "expects," "intends," "plans," "should," "could," "would," "may," "will," "believes," "estimates," "potential," "target," or "continue" and variations or similar expressions. These statements are based upon the current expectations and beliefs of management of Valeant and Salix and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include, but are not limited to, the risk that the acquisition will not close when expected or at all; the risk that Valeant's business and/or Salix's business will be adversely impacted during the pendency of the acquisition; the risk that the operations of the two companies will not be integrated successfully; and risks and uncertainties discussed in Valeant's and Salix's most recent annual or quarterly report and detailed from time to time in Valeant's and Salix's other filings with the Securities and Exchange Commission (the "SEC (SCUR)") and, with respect to Valeant, the Canadian Securities Administrators, which factors are incorporated herein by reference. Readers are cautioned not to place undue reliance on any of these forward-looking statements. These forward-looking statements speak only as of the date hereof. Valeant and Salix undertake no obligation to update any of these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect actual outcomes.
Additional Information
The tender offer described in this press release has not yet commenced and this communication is not a recommendation or an offer to purchase or a solicitation of an offer to sell shares of Salix. At the time the tender offer is commenced Sun Merger Sub, Inc. and Valeant will file a Tender Offer Statement on Schedule TO, containing an offer to purchase, form of letter of transmittal and related tender offer documents, with the SEC, and Salix will file a Solicitation/Recommendation Statement on Schedule 14D-9 relating to the tender offer with the SEC. Valeant and Salix intend to mail these documents to the stockholders of Salix. These documents, as they may be amended from time to time, will contain important information about the tender offer and stockholders of Salix are urged to read them carefully when they become available. Stockholders of Salix will be able to obtain a free copy of these documents, when they become available, at the website maintained by the SEC at www.sec.gov. In addition, the Tender Offer Statement and other documents that Valeant files with the SEC will be made available to all stockholders of Salix free of charge at www.valeant.com. The Solicitation/Recommendation Statement and the other documents filed by Salix with the SEC will be made available to all stockholders of Salix free of charge at www.salix.com.
Contact Information:
Valeant Investors:
Salix Investors:
Laurie W. Little
Timothy J. Creech / Michael Freeman
949-461-6002
919-862-1000
laurie.little@valeant.com
Valeant Media Contacts:
Salix Media Contacts:
Sard Verbinnen & Co
Teneo Strategy
Renee Soto/ Meghan Gavigan/Jared Levy
Stephen Cohen
212-687-8080
347-489-6602
http://photos.prnewswire.com/prnvar/20101025/LA87217LOGO
Logo - http://photos.prnewswire.com/prnh/20101025/LA87217LOGO
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/valeant-to-acquire-salix-pharmaceuticals-for-15800-per-share-in-cash-300039442.html
SOURCE Valeant Pharmaceuticals International, Inc.
Done for now ... may be back later !
Yellen Testimony, Macy's Earnings: What to Watch in the Week Ahead
For the week ahead, we keep an eye on notable earnings, U.S. economic data, and other events that could move the markets. On Tuesday, Federal Reserve chair Janet Yellen testifies before the Senate Banking Committee on the U.S. economy, monetary policy and the global outlook. The following day, she will testify before the House Financial Services Committee in Washington. It's a very busy week on the earnings front. We look for quarterly financial results from HSBC (HSBC), Macy's (M), Comcast (CMCSA), Home Depot (HD), Hewlett Packard (HPQ), Target (TGT), Dollar Tree (DLTR), J.C. Penney (JCP), Gap (GPS), and Anheuser-Busch (BUD). On the economic calendar we point out existing home sales, consumer confidence, consumer price index, and the fourth quarter GDP revision. TheStreet's Kurumi Fukushima reports in New York.
http://www.thestreet.com/video/13053381/yellen-testimony-macys-earnings-what-to-watch-in-the-week-ahead.html
Yellen Testimony, Macy's Earnings: What to Watch in the Week Ahead
For the week ahead, we keep an eye on notable earnings, U.S. economic data, and other events that could move the markets. On Tuesday, Federal Reserve chair Janet Yellen testifies before the Senate Banking Committee on the U.S. economy, monetary policy and the global outlook. The following day, she will testify before the House Financial Services Committee in Washington. It's a very busy week on the earnings front. We look for quarterly financial results from HSBC (HSBC), Macy's (M), Comcast (CMCSA), Home Depot (HD), Hewlett Packard (HPQ), Target (TGT), Dollar Tree (DLTR), J.C. Penney (JCP), Gap (GPS), and Anheuser-Busch (BUD). On the economic calendar we point out existing home sales, consumer confidence, consumer price index, and the fourth quarter GDP revision. TheStreet's Kurumi Fukushima reports in New York.
http://www.thestreet.com/video/13053381/yellen-testimony-macys-earnings-what-to-watch-in-the-week-ahead.html
Read: Warning: Stocks Will Collapse by 50%
Saturday, 21 Feb 2015 02:03 PM
It is only a matter of time before the stock market plunges by 50% or more, according to several reputable experts.
“We have no right to be surprised by a severe and imminent stock market crash,” explains Mark Spitznagel, a hedge fund manager who is notorious for his hugely profitable billion-dollar bet on the 2008 crisis. “In fact, we must absolutely expect it."
Unfortunately Spitznagel isn’t alone.
“We are in a gigantic financial asset bubble,” warns Swiss adviser and fund manager Marc Faber. “It could burst any day.”
Faber doesn’t hesitate to put the blame squarely on President Obama’s big-government policies and the Federal Reserve’s risky low-rate policies, which, he says, “penalize the income earners, the savers who save, your parents — why should your parents be forced to speculate in stocks and in real estate and everything under the sun?”
Billion-dollar investor Warren Buffett is rumored to be preparing for a crash as well. The “Warren Buffett Indicator,” also known as the “Total Market Cap to GDP Ratio,” is breaching sell-alert status and a collapse may happen at any moment.
So with an inevitable crash looming, what are Main Street investors to do? One option is to sell all your stocks and stuff your money under the mattress, and another option is to risk everything and ride out the storm.
But according to Sean Hyman, founder of Absolute Profits, there is a third option.
“There are specific sectors of the market that are all but guaranteed to perform well during the next few months,” Hyman explains. “Getting out of stocks now could be costly.”
How can Hyman be so sure?
He has access to a secret Wall Street calendar that has beaten the overall market by 250% since 1968. This calendar simply lists 19 investments (based on sectors of the market) and 38 dates to buy and sell them, and by doing so, one could turn $1,000 into as much as $178,000 in a 20-year time frame.
Editor's Note: Sean Hyman Reveals His Secret Wall Street Calendar in This Controversial Video, Click Here.
“But this calendar is just one part of my investment system,” Hyman adds. “I have also designed a Crash Alert System that is designed to warn investors before a major correction as well.”
(The Crash Alert System was actually programmed by one of the individuals who coded nuclear missile flight patterns during the Cold War so that it could be as close to 100% accurate as possible).
Hyman explains that if the market starts to plunge, the Crash Alert System will signal a sell signal warning investors to go to cash.
“You would have been able to completely avoid the 2000 and 2008 collapses if you were using this system based on our back-testing,” Hyman explains. “Imagine how much more money you would have if you had avoided those horrific sell-offs.”
One might think Sean is being too confident, but he has proven himself correct in front of millions of people time and time again.
In a 2012 interview on Bloomberg Television, Hyman correctly predicted that Best Buy would drop down to $11 a share and then it would rally back up to $40 a share over the next few months. The stock did exactly what Hyman predicted.
Then, during a Fox Business interview with Gerri Willis in early 2013, he forecast that the market would rally to new highs of 15,000 despite the massive sell-off that was haunting investors. The stock market almost immediately rebounded and hit Hyman’s targets.
“A lot of people think I am lucky,” Hyman said. “But it has nothing to do with luck. It has everything to do with certain tools I use. Tools like the secret Wall Street calendar and my Crash Alert System.”
With more financial uncertainty than ever, thousands of people are flocking to Sean Hyman for his guidance. He has over 114,000 subscribers to his monthly newsletter, and his investment videos have been seen millions of times.
http://www.moneynews.com/MKTNewsIntl/stock-market-crash-warren-buffett-indicator/2014/10/03/id/598461/?dkt_nbr=ufos34vz&utm_source=taboola&utm_medium=referral
I doubt Canada would go that far ... but what do I know
Another Big Reason to Think Oil Prices Aren't Going Up Soon
Inventories bursting at the seams
Oil just had its first weekly decline in a month, breaking a rally in crude prices. A bit of context: After what's happened over the last year, "rally" seems a bit of an overstatement.
Oil 'Rally'
One big factor that may be driving prices down this week: The U.S. is pumping so much oil it's running out of places to stash it.
Crude oil in storage in the U.S. has jumped to the highest levels in at least 80 years, according to a Bloomberg Industries analysis. The EIA this week reported that U.S. inventories rose 7.7 million barrels to 425.6 million. That's more than 20 percent higher than the five-year average.
U.S. Oil Inventories Reach 80-Year High
The buildup of supply has been "colossal" and is responsible for oil prices falling this week, Thomas Finlon, director of Energy Analytics Group LLC, told Bloomberg News.
Winter weather and refinery outages have contributed to the supply glut. Even when those conditions subside, topped-out inventories and continued production growth may continue to suppress oil prices for the near- and medium-term, according to Bloomberg Industries.
Meanwhile, the U.S. is pumping oil at a faster pace than any time since 1972.
Greek Bonds May Lead Periphery Higher After Funding Deal Struck
(Bloomberg) -- Greece’s government bonds may open higher this week after euro-area finance ministers agreed to extend the nation’s bailout funds for four months, avoiding a cash crunch that threatened to push it out of the currency bloc.
The securities of the region’s other higher-yielding nations, including Portugal and Spain, may be boosted by the deal, as concern dissipates that contagion from Greece would spread. Finance chiefs still need to approve a list of economic measures the Greek government will undertake as part of the agreement, leaving the potential for more volatility.
“The biggest political roadblocks to a deal have now been crossed,” Lena Komileva, chief economist at G Plus Economics Ltd. in London, wrote in an e-mailed note. “This creates the setting for a strong market risk rally and some decompression in core yields in favor of peripheral markets on Monday,” she wrote, referring to rates debt from the euro area’s higher-and lower-rated securities.
Greece’s three-year notes posted their first weekly drop this month in the five days through Feb. 20 as negotiations continued on the country’s future financing plans. The yield on the securities increased 78 basis points to 16.62 percent as finance ministers grappled for a plan to extend the bailout program, which was due to expire at the end of February.
The text of the agreement struck in Brussels after European debt markets closed on Friday allows the Mediterranean nation to lower previously agreed targets on reaching a primary budget surplus. That may free up money to meet some of the newly elected Syriza party’s anti-austerity election pledges.
‘Happy Ending’
The euro swung between gains and losses in New York after the agreement was announced, falling from its highs of the day versus the dollar on news parts of the deal still needed to be approved by creditors. Greece’s government must submit a list of measures that finance ministers will discuss in a conference call Tuesday. If the deal is approved it will be put to national parliaments.
“The happy ending will still have an effect on global markets, as more investors jump on the risk bandwagon, while some of the hedge trades would be unwound,” Societe Generale SA analysts including Vincent Chaigneau, the Paris-based global head of fixed-income and foreign-exchange strategy, wrote in an investor note. “An extension of the Greek bailout is not fully priced in.”
Bondholders remained relatively calm through the negotiations. The Bloomberg Greece Sovereign Bond Index, a market-value weighted measure of Greek bonds, was at 91.83 on Friday, up 1 percent this year and 26 percent above its five-year average.
At 9.89 percent, Greece’s 10-year yield is also below its five-year average of 13.86 percent, and an all-time high of 44.21 percent set in 2012. That shows the contrast with movements in debt markets earlier this decade, which toppled governments, pushed countries to accept financial bailouts and took the region to the brink of breakup.
To contact the reporters on this story: Eshe Nelson in London at enelson32@bloomberg.net; David Goodman in London at dgoodman28@bloomberg.net
To contact the editors responsible for this story: Paul Dobson at pdobson2@bloomberg.net
Greek Bonds May Lead Periphery Higher After Funding Deal Struck
(Bloomberg) -- Greece’s government bonds may open higher this week after euro-area finance ministers agreed to extend the nation’s bailout funds for four months, avoiding a cash crunch that threatened to push it out of the currency bloc.
The securities of the region’s other higher-yielding nations, including Portugal and Spain, may be boosted by the deal, as concern dissipates that contagion from Greece would spread. Finance chiefs still need to approve a list of economic measures the Greek government will undertake as part of the agreement, leaving the potential for more volatility.
“The biggest political roadblocks to a deal have now been crossed,” Lena Komileva, chief economist at G Plus Economics Ltd. in London, wrote in an e-mailed note. “This creates the setting for a strong market risk rally and some decompression in core yields in favor of peripheral markets on Monday,” she wrote, referring to rates debt from the euro area’s higher-and lower-rated securities.
Greece’s three-year notes posted their first weekly drop this month in the five days through Feb. 20 as negotiations continued on the country’s future financing plans. The yield on the securities increased 78 basis points to 16.62 percent as finance ministers grappled for a plan to extend the bailout program, which was due to expire at the end of February.
The text of the agreement struck in Brussels after European debt markets closed on Friday allows the Mediterranean nation to lower previously agreed targets on reaching a primary budget surplus. That may free up money to meet some of the newly elected Syriza party’s anti-austerity election pledges.
‘Happy Ending’
The euro swung between gains and losses in New York after the agreement was announced, falling from its highs of the day versus the dollar on news parts of the deal still needed to be approved by creditors. Greece’s government must submit a list of measures that finance ministers will discuss in a conference call Tuesday. If the deal is approved it will be put to national parliaments.
“The happy ending will still have an effect on global markets, as more investors jump on the risk bandwagon, while some of the hedge trades would be unwound,” Societe Generale SA analysts including Vincent Chaigneau, the Paris-based global head of fixed-income and foreign-exchange strategy, wrote in an investor note. “An extension of the Greek bailout is not fully priced in.”
Bondholders remained relatively calm through the negotiations. The Bloomberg Greece Sovereign Bond Index, a market-value weighted measure of Greek bonds, was at 91.83 on Friday, up 1 percent this year and 26 percent above its five-year average.
At 9.89 percent, Greece’s 10-year yield is also below its five-year average of 13.86 percent, and an all-time high of 44.21 percent set in 2012. That shows the contrast with movements in debt markets earlier this decade, which toppled governments, pushed countries to accept financial bailouts and took the region to the brink of breakup.
To contact the reporters on this story: Eshe Nelson in London at enelson32@bloomberg.net; David Goodman in London at dgoodman28@bloomberg.net
To contact the editors responsible for this story: Paul Dobson at pdobson2@bloomberg.net
< Roof Collapses Mount Across Boston Region in Weekend Snow, Rain
(Bloomberg) -- Roofs continue to collapse under record snow across the Boston area, most over warehouses and barns, as the latest weekend storm brings three to five inches of snow, topped off by up to a half-inch of rain in some areas.
Sunday’s tally shows 128 roofs have failed in the last two weeks, up from 106 roofs on Friday, according to Peter Judge, spokesman for the Massachusetts Emergency Management Agency, MEMA.
A barn roof collapse in Andover, Massachusetts, where several horses were rescued Sunday is typical of what local and state emergency personnel are seeing, Judge said. Cave-ins on residential property have been limited to attached garages, decks and other structures that are not inhabited. There have been no serious injuries, he said.
A winter weather advisory has been posted for the region until 1 p.m. local time Sunday as light snow, sleet and some freezing continued to fall, according to Frank Nocera, a meteorologist at the National Weather Service in Taunton, Massachusetts.
The areas of prime concern for more structural failures are southeastern Massachusetts including Cape Cod where a half-inch of rain fell in some spots overnight and Rhode Island, he said.
Nocera said his agency had received a report of a partial roof collapse over a Lowe’s Home Improvement Center in Warwick, Rhode Island, in this latest batch of precipitation.
In Massachusetts, the number is expected to climb over the next few days, Judge said.
Sagging roofs, leaks inside the house and cracked or split wood in the structural makeup of the dwelling are all signs of trouble, MEMA said on its website.
To ease the roof’s load, the state recommends a snow rake - - if you can find one for sale. Start from the edge and work inward, shaving the piles down to two or three inches. Scraping the roof clean will risk damage to shingles and other roofing material, MEMA advises.
As of late last week, Boston had received 98.7 inches (about 250 centimeters) at Logan International Airport, making the current winter the snowiest on record behind 1995-1996, when 107.6 inches fell.
To contact the reporter on this story: Tom Moroney in Boston at tmorrone@bloomberg.net
To contact the editors responsible for this story: Gary Putka at gputka@bloomberg.net Stephen Cunningham, Bruce Rule
But for us ... men, the pain is different ! LMAO
If wifey hears that, i'm a dead body ...
Morning girl ...
It's been so cold here lately, all my bones hurt
Good morning Larry, fuzzy & all !
Well ... it's 9:00am somewhere, right
My body clock is outta sync ... Morning !
Apple Shares Could Return 25% in a Year
Apple’s earnings are expected to jump 32% this year, to $8.53 a share—and earnings are surely understated.
By Jack Hough
February 21, 2015
Apple ’s success with bigger iPhone screens has helped expand its stock valuation. The shares have climbed to $129 from a split-adjusted $76 since we recommended them nearly a year ago (“For Apple, Bigger Is Surely Better,” March 24, 2014). They now go for 14.8 times projected earnings for the next four quarters, up from 12 times.
The last time Apple (ticker: AAPL) hit a major peak, at about $100 in September 2012, its shares had a slightly lower price-to-earnings ratio than now, and a more diversified business mix, with iPhones making up barely half of sales, versus closer to two-thirds now. The shares went on to tumble 40% in less than a year. Might Apple now be topping out again?
Unlikely. Look for the stock price to rise to $160 over the next year for a 25% return including dividends. Expect a big dividend hike when the company updates its capital-return program, likely in April. The current yield looks undersized at 1.5%.
Put product speculation aside for the moment, and consider a few things about the stock valuation. First, Apple sits on cash and investments worth $30 a share, up from $18 a share back in September 2012. Net of this cash, the shares are cheaper than they appear.
Second, Apple’s earnings are unusually clean. Management doesn’t point investors toward a spiffed-up measure of earnings that excludes things like the cost of issuing stock to employees, as many big tech firms do. The $8.53 a share that Wall Street predicts Apple will earn in its current fiscal year, through September, is calculated under generally accepted accounting principles, or GAAP. Contrast that with, say, Facebook, which is expected to report adjusted earnings of $1.96 a share this year, but GAAP earnings of only 96 cents. Or Google, projected to earn an adjusted $28.71 a share, but $23.11 under GAAP. Apples to apples, you know who shines.
Third, Apple’s free-cash generation—what matters in the long run for paying dividends, buying back shares, and investing in new gadgets and services—easily exceeds its earnings. Only part of the difference is explained by stock compensation reducing earnings but not free cash. Apple whips through merchandise so quickly that it enjoys what’s called a negative cash-conversion cycle, meaning it collects money from customers faster than it pays suppliers. That’s rare. Wall Street expects Apple’s free cash flow to total $10.17 a share this fiscal year, or 19% more than its earnings.
Put it all together and Apple trades at an enterprise value—a measure that adjusts the stock market value for debt and cash holdings—of 10.1 times projected free cash flow for calendar 2015. That puts it on par with Hewlett-Packard (HPQ), and makes it 11% cheaper than Microsoft (MSFT). Companies like General Mills (GIS) and Procter & Gamble (PG), which investors flock to precisely for the ability to turn out steady cash, carry enterprise values closer to 25 times free cash flow.
That raises the question of whether Apple can continue to grow after the runaway success of the iPhone 6. It already enjoys about a 20% market share in smartphone units—and more than a 90% share in smartphone profits, in part because its average selling prices are more than double the industry average. That would seem to set Apple up for impossible comparisons starting around this Christmas, when it will lap the first full quarter of iPhone 6 sales. And yet, earnings estimates for more distant quarters have been rising. For example, Wall Street now predicts that Apple will earn $2.28 a share in the quarter a year from now, ending in March 2016. Five months ago, the estimate for that quarter was under $2.
ONE REASON THAT DISTANT estimates are pushing higher may be gathering confidence that the iPhone has more upside. Only 15% or so of the user base has upgraded to the 6 so far. If history repeats, Apple will launch a 6s model in the fall with a similar design and improved specs and software. Confidence may also be rising in the forthcoming Apple Watch, which bulls say could add 10% to fiscal-2016 revenue (“The Apple Watch Could Bring In $23 Billion Next Year,” Tech Trader, Feb. 16). If the watch is a hit, Apple Pay could be, too. Piper Jaffray Apple analyst Gene Munster thinks that Apple will launch a new Apple TV set-top box this fall with gaming and home-automation capabilities and perhaps bundled content to compete with cable. That could pave the way for a television. And Apple is reportedly gearing up to produce a car by 2020.
None of these alone will send the stock soaring. For example, an Apple car might sound exciting, but even adding Ford’s market value to Apple’s would lift shares just 9%—and Apple is surely not going to become Ford anytime soon. But together, the products and rumors suggest that the Appleverse is still expanding, as Apple finds new pain-in-the-neck activities it can make sleeker and easier with a combination of hardware and software.
As the numbers stand now, Wall Street forecasts a 32% earnings-per-share jump this fiscal year on the strength of the iPhone 6, followed by 7% and 6% increases in the two following years. A rise to $160 in a year would put the shares at 17 times forward earnings estimates, where the Standard & Poor’s 500 index trades today. Considering Apple’s understated earnings, its cash hoard, its avenues for growth, and its history of beating expectations, it’s time for the stock to carry at least a market valuation, if not a premium.
E-mail: editors@barrons.com
To Nasdaq 5000 and Beyond
The dot-com era Nasdaq was a product of dreams. Now, strong profits drive its rise. When the index finally tops 5000 again, it’s likely to stay.
By Alexander Eule
February 21, 2015
Looking back, it seems like a mirage. For a few days in March 2000, the Nasdaq Composite hovered above 5000. That same week, as Barron’s chronicled, Procter & Gamble (ticker: PG) tumbled 39%. The Dow Jones Industrial Average, meanwhile, was down 14% on the year, against the Nasdaq’s 24% gain. The New Economy was making its mark.
Until it wasn’t. The Nasdaq held 5000 for barely 48 hours before crashing 80% in the next 31 months.
P&G recovered its losses in two years. The Nasdaq is still trying, though it seems to be a matter of days now. The high-tech index closed last week at 4956, just 1% from 5000 and 2% from its all-time closing high of 5049.
This time, the 5000 level could stick. “What was propelling the Nasdaq in the year 2000 was a dream. What’s driving the Nasdaq today is reality,” says Gavin Baker, who runs the Nasdaq-focused Fidelity OTC Portfolio fund (FOCPX). “The current valuation is very well supported by earnings and cash flows and if those earnings and cash flows continue growing, the Nasdaq should continue going up.”
Patience and fundamentals have been force-fed on Nasdaq investors. The nearly 3,900-point recovery has taken 12 years. In the 1990s, the Nasdaq had managed the same 350% gain in just three. The dot-com rally, of course, was powered by wildly inflated multiples. In March 2000, the Nasdaq traded at well over 100 times earnings. Today, the Nasdaq has a price/earnings multiple of 21, a few ticks above the Standard & Poor’s 500, at 17.5.
“You had a lot of very immature companies that didn’t have real business models. They were entirely depending on the capital markets for funding,” says Baker, originally a tech analyst who has run Fidelity’s OTC fund since 2009. The OTC name is a throwback to the fund’s 1984 inception, when the Nasdaq was colloquially known as the over-the-counter market. Today, Fidelity OTC is one of just a handful of mutual funds that benchmarks against the Nasdaq. That gives Baker a unique view of the index. “In a lot of ways the reality that we are living in is more incredible than the dream that was driving the Nasdaq” 15 years ago, he says.
But that hasn’t stopped P/Es from tumbling to Earth. “That’s what the story is,” Baker adds. “The earnings of the Nasdaq have grown significantly. The P/E has dramatically compressed.” Valued at 2000’s P/E level, today’s Nasdaq would be priced somewhere around 30,000, Baker notes.
It’s worth pointing out that, in real terms, Nasdaq investors are still waiting to be made whole. Despite a relatively modest inflation rate of 2.2% over the last 15 years, Nasdaq 5000 is actually Nasdaq 7000.
Only Microsoft (MSFT) and Intel (INTC) were on the index’s Top 10 list 15 years ago and remain there today. Oracle (ORCL), with a market value of $192 billion, would rank No. 5, but it changed its listing to the New York Stock Exchange in 2013.
EVEN NASDAQ 7000 is not impossible in the coming years. The index is now a mature group; the largest contributors to the index carry reasonable P/Es (see table). Earnings alone could drive the Nasdaq up 18% in the coming year, if analysts’ estimates are correct. According to FactSet, combined earnings for the index are forecast to be $235 per share in 2015, up from last year’s $199.
The Nasdaq’s performance, meanwhile, is now backstopped by the world’s largest company. Apple (AAPL) makes up 10% of the index. At just 14.7 times earnings estimates for the next 12 months, Apple shares could easily head higher, as Barron’s points out in “Apple Shares Could Return 25% in a Year.”
There are still bubble-type stocks, of course. Fifteen years after the crash, investors continue to pay up for Amazon.com (AMZN), even though it struggles to turn a profit. SolarCity (SCTY), a solar-panel installer, is up 579% since its December 2012 initial public offering and now fetches a market value of $5.2 billion. The company has never produced an annual profit and is likely to lose $531 million this year.
Still, if the dot-com edition of Nasdaq 5000 left a legacy, it’s a more discriminating class of technology investors, at least in the public arena. Underwriters know better than to come to market with a half-baked idea. Last year, just 53 technology companies came public, according to University of Florida professor Jay Ritter, compared with 371 in 1999 and 261 in 2000. It’s a different Nasdaq. Soon 5000 could be just another number.
E-mail: editors@barrons.com