Tiffany seen as a take-over target

Tiffany seen as possible target for big European luxury player

Tiffany seen as a take over target. Stockwinners.com
Tiffany seen as a take over target

Shares of Tiffany (TIF) are on the rise after Citi analyst Paul #Lejuez upgraded the stock to Buy, citing currency tailwinds, tax reform and the increasing probability the jewelry retailer becomes a takeover target of an European luxury conglomerate.

BUY TIFFANY

In a research note to investors, Citi’s Lejuez upgraded Tiffany to Buy from Neutral and raised his price target on the shares to $115 from $92.

The third quarter brought several positive inflection points, he contended, noting that it was the first quarter in several years that the company saw strength in both the fashion category and the high/fine/solitaire category at the same time.

Further, Lejuez argued that the shares look attractive as currency tailwinds and tax reform should benefit the company’s earnings.

The analyst also told investors that he sees increasing probability that the jewelry retailer will become a target of an European luxury conglomerate, making Tiffany’s risk/reward that much more favorable.

Management seems to understand the challenges and opportunities and they are not sitting still, he pointed out, making the analyst more optimistic that the changes he has seen thus far have Tiffany on a better path for success.

WHAT’S NOTABLE

Earlier in the month, KeyBanc analyst Edward #Yruma also upgraded Tiffany to Overweight from Sector Weight, with a $115 price target, saying he believes the positive 1% Americas comparable sales growth in the third quarter points to the early stages of a more broad-based sales recovery.

Recent strength in silver jewelry is now being augmented by early signs of improvement in higher-end jewelry, Yruma argued, adding that he views Tiffany as a “strong brand.”

PRICE ACTION

In Thursday’s trading, shares of Tiffany have gained over 3% to $99.27.


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Teva Pharmaceutical suspends its dividend

Teva to cut over 25% of workforce, suspends dividend 

14,000 people will lose their jobs

Teva suspends its dividend

Teva Pharmaceutical Industries (TEVA) announced a restructuring plan intended to “significantly reduce its cost base, unify and simplify its organization and improve business performance, profitability, cash flow generation and productivity.”

The two year restructuring plan is intended to reduce Teva’s total cost base by $3B by the end of 2019, out of an estimated cost base for 2017 of $16.1B.

More than half of the reduction is expected to be achieved by the end of 2018.

The company expects to record a restructuring charge as a result of the implementation of the plan in 2018 of at least $700M, mainly related to severance costs, with additional charges possible following decisions on closures or divestments of manufacturing plants, R&D facilities, headquarters and other office locations.

These steps are expected to result in the reduction of 14,000 positions globally – excluding the impact of any future divestments – over 25% of Teva’s total workforce – over the next two years.

The majority of the reductions are expected to occur in 2018, with most of the affected employees being notified within the next 90 days.

Restructuring efforts will be done in accordance with applicable local requirements.

Consultations with the relevant employee representatives will begin in the near term.

In addition to the restructuring plan, Teva is announcing the following measures to address the company’s financial situation: The company will immediately suspend dividends on ordinary shares and ADSs, while dividends on mandatory convertible preferred shares will be evaluated on a quarterly basis per current practice; Teva’s annual bonus for 2017 will not be paid due to the fact that the company’s financial results are significantly below our original guidance for the year; The company will continue to review the potential for additional divestment of non-core assets;

Teva will provide full guidance for 2018 in February with the annual results and will share a longer-term strategic direction for the company later in 2018.

TEVA closed at $15.70. It last traded at $17.65.


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Ampio Pharmaceuticals reports positive osteoarthritis data

Ampio says Phase 3 clinical trial of Ampion met its primary endpoint

Ampio says Phase 3 clinical trial of Ampion met its primary endpoint. Stockwinners
Ampio says Phase 3 clinical trial of Ampion met its primary endpoint

Ampio Pharmaceuticals (AMPE) reported that the Phase 3 clinical trial of Ampion met its primary endpoint with 71% of Ampion treated patients meeting the OMERACT-OARSI responder criteria, which exceeds the physician reported threshold of 30% for a meaningful treatment in severe osteoarthritis of the knee (p less than 0.001).

Osteoarthritis, commonly known as wear-and-tear arthritis, is a condition in which the natural cushioning between joints — cartilage — wears away. When this happens, the bones of the joints rub more closely against one another with less of the shock-absorbing benefits of cartilage. The rubbing results in pain, swelling, stiffness, decreased ability to move and, sometimes, the formation of bone spurs.

While it can occur even in young people, the chance of developing osteoarthritis rises after age 45. According to the Arthritis Foundation, more than 27 million people in the U.S. have osteoarthritis, with the knee being one of the most commonly affected areas. Women are more likely to have osteoarthritis than men.

Responders experienced, on average a 53% decrease in pain as measured by WOMAC A and a 50% improvement in function as measured by WOMAC C and a 45% improvement in quality of life as measured by Patient Global Assessment.

In the secondary endpoints, Ampion treated patients achieved statistical significance in a composite endpoint of pain and function from baseline in both categories at 12 weeks (p less than 0.001), which was supported by an increase in quality of life as measured by patient global assessment (p less than 0.001).

When treated with Ampion (n=144), patients experienced significant improvement in a composite endpoint of pain and function compared to all KL 4 saline-treated patients (n=206) in Ampion phase 3 clinical trials (p less than 0.001).

Ampion was well tolerated with treatment-emergent adverse events comparable to those of placebo in all single-injection studies of Ampion. There were no drug-related serious TEAEs associated with the Ampion arm.

The safety and tolerability profile of Ampion is consistent with previous studies. To date, Ampion has been given to over 900 patients with no reported drug-related serious TEAEs.

Ampio plans to present a more detailed analysis of the Phase 3 and pooled data at an upcoming scientific meeting as well as submission for publication.

AMPE closed at $1.75.


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Disney goes shopping

Disney to acquire 21st Century Fox after spinoff of certain units for $52.4B

Disney to acquire 21st Century Fox for $52.4B

The Walt Disney Company (DIS) and Twenty-First Century Fox, Inc. (FOXA, FOX) announced that they have entered into a definitive agreement for Disney to acquire 21st Century Fox, including the Twentieth Century Fox Film and Television studios, along with cable and international TV businesses, for approximately $52.4B in stock.

Building on Disney’s commitment to deliver the highest quality branded entertainment, the acquisition of these complementary assets would allow Disney to create more appealing content, build more direct relationships with consumers around the world and deliver a more compelling entertainment experience to consumers wherever and however they choose.

Immediately prior to the acquisition, 21st Century Fox will separate the Fox Broadcasting network and stations, Fox News Channel, Fox Business Network, FS1, FS2 and Big Ten Network into a newly listed company that will be spun off to its shareholders.

Under the terms of the agreement, shareholders of 21st Century Fox will receive 0.2745 Disney shares for each 21st Century Fox share they hold.

The exchange ratio was set based on a 30-day volume weighted average price of Disney stock. Disney will also assume approximately $13.7B of net debt of 21st Century Fox.

The acquisition price implies a total equity value of approximately $52.4B and a total transaction value of approximately $66.1B which includes consolidated assets along with a number of equity investments.

SKY NEWS

Prior to the close of the transaction, it is anticipated that 21st Century Fox (FOX, FOXA) will seek to complete its planned acquisition of the 61% of Sky (SKYAY) it doesn’t already own. 21st Century Fox remains fully committed to completing the current Sky offer and anticipates that, subject to the necessary regulatory consents, the transaction will close by June 30, 2018.

Assuming 21st Century Fox completes its acquisition of Sky prior to closing of the transaction, The Walt Disney Company (DIS) would assume full ownership of Sky.

DIS closed at $107.61. FOX closed at $32.34.


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