Top 10 News Items for 10/29 - 11/02: Hurricane Sandy Hits NYC, East Coast; U.S. Adds More Payrolls in Oct.; Disney's Big, Big Acquisition; Mulally to Stick with Ford
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Top 10 new items for 10/29 - 11/02:
1. U.S. markets were on the longest weather-related hiatus since 1888, closing on Monday and Tuesday as Superstorm Sandy pounded the East Coast with wind, rain, and devastation. Amid markets coming back online, there are still many without power in New York City and other major metropolises also suffering the aftermath.
All in all, volume on Wednesday was minimal and most markets ended the shortened week higher.
Winds hit about 90 mph in some areas while snowfall was as much as 34 inches. That snowfall number, by the way, was recorded in Tennessee, miles away from the Eastern U.S. and averages about 45 degrees to 50 degrees Fahrenheit in the coldest parts of winter.
2. The U.S. added 171,000 payrolls in the month of October, according to the latest data from the Bureau of Labor Statistics. The number was 37 percent better than economist expectations of 125,000 jobs.
Long-term unemployed numbers were firm at 5 million, accounting for 40.6 percent of the total. The BLS noted that October employment rose in professional and business services, health care, and retail trade. The mining segment lost jobs in the month, while manufacturing,, wholesale trade, transportation and warehousing, information, financial activities, and government, showed little change over the month."
For 2012, the average monthly gain was 157,000, versus 153,000 in the same period last year.
3. On Tuesday, Disney (NYSE: DIS) announced that it entered into an agreement to acquire Lucasfilm Ltd., proprietor of the Star Wars franchise and ILM.
Under the terms of the agreement and based on the closing price of Disney stock on October 26, 2012, the transaction value is $4.05 billion, with Disney paying approximately half of the consideration in cash and issuing approximately 40 million shares at closing. The final consideration will be subject to customary post-closing balance sheet adjustments.
4. Many questions have been raised as to whether or not Ford (NYSE: F) CEO Alan Mulally would stick around for a little while longer. Those questions were laid to rest on Thursday when Ford said that Mulally would stick around through the end of 2014. The automaker is also lining up succession for Mulally, appointing North America President Mark Fields as Chief Operating Officer, a role he'll assume on December 1st. To read more on the management change's at Ford, click here.
5. PVH Corp. (NYSE: PVH) and The Warnaco Group, Inc. (NYSE: WRC) entered an agreement where PVH would acquire Warnaco. The deal would provide Warnaco holders with $51.75 in cash and 0.1822 of a share of PVH common stock for each share of Warnaco common stock.
The holders of Warnaco common stock will receive $51.75 in cash and .1822 of a share of PVH common stock for each share of Warnaco common stock. The transaction values Warnaco at approximately $2.9 billion.
Warnaco brands include Calvin Klein, Speedo, and Chaps.
6. Netflix (Nasdaq: NFLX) investors got a pleasant surprise earlier in the week when activist investor Carl Icahn disclosed nearly a 10 percent stake in the content streaming giant. Icahn said he holds 5,514,066 shares of Netflix, equal to about 9.98 percent of all outstanding common. Shares ended Wednesday's session up 13.9 percent.
According to the 13D filed with the U.S. SEC: "The Reporting Persons ("Icahn") acquired the Shares with the belief that the Shares were undervalued due to the Issuer's ("Netflix") dominant market position and international growth prospects. The Reporting Persons believe Netflix may hold significant strategic value for a variety of significantly larger companies that are engaging in more direct competition with one another due to the evolution of the internet, mobile, and traditional industry. The Reporting Persons are considering ways for the Issuer to maximize shareholder value but have reached no conclusion. The Reporting Persons may in the future seek to have discussions with the Issuer."
7. Apple's (Nasdaq: AAPL) iPad Mini went on sale Friday, with mixed expectations and reports all around. Piper's Gene Munster said anywhere from 1 million to 1.5 million of the unit should be sold, while BTIG analyst Walter Piecyk said that number should be closer to 3 million units. Intraday, Topeka Capital said Apple's New York City flagship store was sold out of the device.
Investors will be anxiously awaiting Monday when some firmer numbers are out from analysts following channel checks over the weekend. Maybe Apple itself will event issue a rare comment on the numbers.
8. According to the ISM on Thursday, its Manufacturing PMI rose to 51.7 percent in October, from 51.5 percent the prior month. The Street consensus expected a dip to 51 flat. The reading is the highest for the index since last May.
Leading growth for the month were Petroleum & Coal Products, Furniture & Related Products, and Apparel, Leather & Allied Products.
New Orders rose 1.9 points to 54.2, which was the second consecutive month of growth for the metric. Production popped 2.9 points to 52.4 percent for the month, reversing two months of contration in the segment.
9. The other big acquisition this week was Riverbed Technology (Nasdaq: RVBD) moving to acquire OPNET Technologies, Inc. (Nasdaq: OPNT) for $43 per share in a cash and stock deal. The amount represents an equity value of $1 billion and enterprise value of $921 million. Under the terms of the agreement between Riverbed and OPNET, Riverbed will acquire all of the outstanding shares of OPNET common stock pursuant to an exchange offer, followed by a second step merger. In the exchange offer and the merger, OPNET stockholders will receive for each OPNET share they own: (i) $36.55 in cash; and (ii) 0.2774 of a share of Riverbed common stock.
More than anything else, the acquisition will enhance Riverbed's networking communications business and even open up another revenue stream for the device maker.
10. Some notable earnings reports from the week:Ford Motor Co. (NYSE: F) reported Q3 EPS of $0.40, $0.10 better than the analyst estimate of $0.30. Revenue for the quarter came in at $32.1 billion versus the consensus estimate of $31.32 billion.
Pfizer, Inc. (NYSE: PFE) reported Q3 EPS of $0.53, in-line with the analyst estimate of $0.53. Revenue for the quarter came in at $14 billion versus the consensus estimate of $14.64 billion.
Exxon Mobil (NYSE: XOM) reported Q3 EPS of $2.09, $0.13 better than the analyst estimate of $1.96.
General Motors (NYSE: GM) reported Q3 EPS of $0.93, $0.33 better than the analyst estimate of $0.60. Revenue for the quarter came in at $37.6 billion versus the consensus estimate of $35.92 billion.
Visa (NYSE: V) reported Q4 EPS of $1.54, $0.05 better than the analyst estimate of $1.49. Revenue for the quarter came in at $2.73 billion versus the consensus estimate of $2.67 billion.
Mastercard, Inc. (NYSE: MA) reported Q3 EPS of $6.17, $0.26 better than the analyst estimate of $5.91. Revenue for the quarter came in at $1.92 billion versus the consensus estimate of $1.94 billion.
American International Group (NYSE: AIG) reported Q3 EPS of $1.00, $0.14 better than the analyst estimate of $0.86.
Electronic Arts, Inc. (NASDAQ: EA) reported Q2 EPS of $0.15, $0.04 better than the analyst estimate of $0.11. Revenue for the quarter came in at $1.08 billion versus the consensus estimate of $1.08 billion.
Barrick Gold Corp. (NYSE: ABX) reported Q3 EPS of $0.85, $0.14 worse than the analyst estimate of $0.99. Revenue for the quarter came in at $3.44 billion versus the consensus estimate of $3.61 billion.
Linkedin (NYSE: LNKD) reported Q3 EPS of $0.22, $0.11 better than the analyst estimate of $0.11. Revenue for the quarter came in at $252 million versus the consensus estimate of $243.9 million.
1. U.S. markets were on the longest weather-related hiatus since 1888, closing on Monday and Tuesday as Superstorm Sandy pounded the East Coast with wind, rain, and devastation. Amid markets coming back online, there are still many without power in New York City and other major metropolises also suffering the aftermath.
All in all, volume on Wednesday was minimal and most markets ended the shortened week higher.
Winds hit about 90 mph in some areas while snowfall was as much as 34 inches. That snowfall number, by the way, was recorded in Tennessee, miles away from the Eastern U.S. and averages about 45 degrees to 50 degrees Fahrenheit in the coldest parts of winter.
2. The U.S. added 171,000 payrolls in the month of October, according to the latest data from the Bureau of Labor Statistics. The number was 37 percent better than economist expectations of 125,000 jobs.
Long-term unemployed numbers were firm at 5 million, accounting for 40.6 percent of the total. The BLS noted that October employment rose in professional and business services, health care, and retail trade. The mining segment lost jobs in the month, while manufacturing,, wholesale trade, transportation and warehousing, information, financial activities, and government, showed little change over the month."
For 2012, the average monthly gain was 157,000, versus 153,000 in the same period last year.
3. On Tuesday, Disney (NYSE: DIS) announced that it entered into an agreement to acquire Lucasfilm Ltd., proprietor of the Star Wars franchise and ILM.
Under the terms of the agreement and based on the closing price of Disney stock on October 26, 2012, the transaction value is $4.05 billion, with Disney paying approximately half of the consideration in cash and issuing approximately 40 million shares at closing. The final consideration will be subject to customary post-closing balance sheet adjustments.
4. Many questions have been raised as to whether or not Ford (NYSE: F) CEO Alan Mulally would stick around for a little while longer. Those questions were laid to rest on Thursday when Ford said that Mulally would stick around through the end of 2014. The automaker is also lining up succession for Mulally, appointing North America President Mark Fields as Chief Operating Officer, a role he'll assume on December 1st. To read more on the management change's at Ford, click here.
5. PVH Corp. (NYSE: PVH) and The Warnaco Group, Inc. (NYSE: WRC) entered an agreement where PVH would acquire Warnaco. The deal would provide Warnaco holders with $51.75 in cash and 0.1822 of a share of PVH common stock for each share of Warnaco common stock.
The holders of Warnaco common stock will receive $51.75 in cash and .1822 of a share of PVH common stock for each share of Warnaco common stock. The transaction values Warnaco at approximately $2.9 billion.
Warnaco brands include Calvin Klein, Speedo, and Chaps.
6. Netflix (Nasdaq: NFLX) investors got a pleasant surprise earlier in the week when activist investor Carl Icahn disclosed nearly a 10 percent stake in the content streaming giant. Icahn said he holds 5,514,066 shares of Netflix, equal to about 9.98 percent of all outstanding common. Shares ended Wednesday's session up 13.9 percent.
According to the 13D filed with the U.S. SEC: "The Reporting Persons ("Icahn") acquired the Shares with the belief that the Shares were undervalued due to the Issuer's ("Netflix") dominant market position and international growth prospects. The Reporting Persons believe Netflix may hold significant strategic value for a variety of significantly larger companies that are engaging in more direct competition with one another due to the evolution of the internet, mobile, and traditional industry. The Reporting Persons are considering ways for the Issuer to maximize shareholder value but have reached no conclusion. The Reporting Persons may in the future seek to have discussions with the Issuer."
7. Apple's (Nasdaq: AAPL) iPad Mini went on sale Friday, with mixed expectations and reports all around. Piper's Gene Munster said anywhere from 1 million to 1.5 million of the unit should be sold, while BTIG analyst Walter Piecyk said that number should be closer to 3 million units. Intraday, Topeka Capital said Apple's New York City flagship store was sold out of the device.
Investors will be anxiously awaiting Monday when some firmer numbers are out from analysts following channel checks over the weekend. Maybe Apple itself will event issue a rare comment on the numbers.
8. According to the ISM on Thursday, its Manufacturing PMI rose to 51.7 percent in October, from 51.5 percent the prior month. The Street consensus expected a dip to 51 flat. The reading is the highest for the index since last May.
Leading growth for the month were Petroleum & Coal Products, Furniture & Related Products, and Apparel, Leather & Allied Products.
New Orders rose 1.9 points to 54.2, which was the second consecutive month of growth for the metric. Production popped 2.9 points to 52.4 percent for the month, reversing two months of contration in the segment.
9. The other big acquisition this week was Riverbed Technology (Nasdaq: RVBD) moving to acquire OPNET Technologies, Inc. (Nasdaq: OPNT) for $43 per share in a cash and stock deal. The amount represents an equity value of $1 billion and enterprise value of $921 million. Under the terms of the agreement between Riverbed and OPNET, Riverbed will acquire all of the outstanding shares of OPNET common stock pursuant to an exchange offer, followed by a second step merger. In the exchange offer and the merger, OPNET stockholders will receive for each OPNET share they own: (i) $36.55 in cash; and (ii) 0.2774 of a share of Riverbed common stock.
More than anything else, the acquisition will enhance Riverbed's networking communications business and even open up another revenue stream for the device maker.
10. Some notable earnings reports from the week:
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