Tesla in focus ahead of shareholder vote on CEO compensation

Tesla in focus ahead of shareholder vote on compensation

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Tesla in focus ahead of shareholder vote on compensation

Shares of Tesla (TSLA) are in focus amid the upcoming shareholder vote on a proposed $2.6B compensation package for chief executive officer Elon Musk.

SHAREHOLDER VOTE

Tesla shareholders will vote on the package for Musk at a special shareholder meeting on Wednesday, Bloomberg reported.

The package, which would give Musk an unprecedented ten-figure award of stock options, is linked to Tesla meeting a number of goals and needs support from investors holding a majority of the share.

Shareholders Baillie Gifford & Co. and T. Rowe Price (TROW) have signaled they’re likely to support the plan.

PAY PLAN DETAILS

On January 23, Tesla announced a new ten-year performance award for Musk with vesting entirely contingent on achieving market cap and operational milestones.

In order to fully vest, Tesla’s market cap would have to grow to $650B, an increase of almost $600B, and important revenue and profitability goals would also have to be achieved.

Musk will receive no guaranteed compensation of any kind — no salary, no cash bonuses and no equity that vests simply by the passage of time. Instead, his only compensation will be a 100% at-risk performance award. The performance award consists of a ten-year grant of stock options that vests in 12 tranches.

Each of the 12 tranches vest only if a pair of milestones is met. To meet the first market cap milestone, Tesla’s current market cap must increase to $100B.

For each of the remaining 11 milestones, Tesla’s market cap must continue to increase in additional $50B increments.

For Musk to fully vest in the award, Tesla’s market cap must increase to $650B.

To meet the operational milestones, Tesla must meet a set of escalating revenue and adjusted EBITDA targets designed to ensure that as Tesla’s market cap grows, the company is also executing well on both a top-line and bottom-line basis.

For each of the 12 tranches that is achieved, Musk will vest in stock options that correspond to 1% of Tesla’s current total outstanding shares. If none of the 12 tranches is achieved, Musk will not receive compensation.

For vesting to occur when the milestones are met, Musk must remain as Tesla’s CEO or serve as both executive chairman and chief product officer with all leadership reporting to him.

PROXY FIRM RECOMMENDATIONS

Proxy advisory firm Glass Lewis has recommended Tesla stakeholders vote against the proposal, saying if Musk were to receive the full grant, he would own 28.3% of the car maker, Reuters reported in March.

“The cost of the grant is staggering relative to executive compensation levels among public companies worldwide,” Glass Lewis said. In addition, proxy firm ISS recommended shareholders reject the pay package, saying the “unprecedented” stock award is too rich, Reuters reported.

The award “locks in unprecedented high pay opportunities for the next decade, and seemingly limits the board’s ability to meaningfully adjust future pay levels in the event of unforeseen events or changes in either performance or strategic focus,” ISS said.

TESLA UNDER PRESSURE

Tesla has also seen executives depart the company in the last month with Susan Repo, corporate treasurer and VP of finance, leaving to take on a chief financial officer position at another firm and chief accounting officer Eric Branderiz departing for “personal reasons”.

Additionally, the company lost Jon McNeill, president of global sales and service, in February and former CFO Jason Wheeler in 2017. Tesla is also expected to report production and deliveries results for its Model 3 Sedan, which has faced challenges including quality issues and a production halt. Musk has delayed manufacturing goals several times for Model 3.

PRICE ACTION

Tesla rose 2.6% to $318.54 in Wednesday’s trading.


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CSRA receives $44 a share buyout offer

CSRA confirms receipt of unsolicited proposal

 

CSRA receives $44 a share buyout offer. Stockwinners.com
CSRA receives $44 a share buyout offer. Stockwinners.com

CSRA (CSRA) confirmed receipt of an unsolicited proposal from CACI International (CACI) to acquire all of the outstanding shares of CSRA common stock for a combination of CACI common stock and cash, consisting of CACI common stock based on a fixed exchange ratio of 0.184 shares of CACI common stock for each share of CSRA common stock, and cash equal to $15 per share.

The combination of cash and stock is equal to approximately $44 per share, based upon CACI’s closing price on March 16, 2018 of $157.45 per share.

As previously announced on February 12, 2018, following unanimous approval from the company’s Board of Directors, CSRA entered into an Agreement and Plan of Merger with General Dynamics Corporation (GD) under which a wholly owned subsidiary of General Dynamics has agreed to acquire all outstanding shares of CSRA common stock for $40.75 per share in cash. Pursuant to the Merger Agreement, a wholly owned subsidiary of General Dynamics has commenced a tender offer to acquire all of the outstanding shares of CSRA common stock for $40.75 per share in cash.

The Offer is scheduled to expire at 11:59 p.m., New York City time, on April 2, 2018, unless extended or earlier terminated in accordance with the Merger Agreement.

CSRA’s Board of Directors, in consultation with its legal and financial advisors, will carefully review and consider the Proposal. CSRA remains subject to the Merger Agreement.

The CSRA Board of Directors has not changed its recommendation that CSRA stockholders tender their shares of CSRA common stock pursuant to the Offer.


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Tesla drops as executives leave

Tesla drops as second executive departs in less than a week

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Tesla drops as executives leave

Shares of Tesla (TSLA) dropped in Wednesday trading following a report that said a top financial executive is leaving the company, the second executive departure in less than a week at the electric car maker.

LATEST EXECUTIVE DEPARTURE

Susan Repo, Tesla’s corporate treasurer and VP of finance who joined the company in 2013, has departed the company to take on a CFO position at another firm, Bloomberg reported last night, citing a person familiar with the matter.

Repo’s departure comes less than a week after Tesla Chief Accounting Officer Eric Branderiz left the company for “personal reasons,” Tesla disclosed on March 7.

The departures of Repo and Branderiz are the latest in a string of executive departures at Tesla over the last 12 months.

In addition to Repo and Branderiz, Tesla has also lost Jon McNeill, president of global sales and service, who left the company in February to become Lyft’s COO.

The company also lost former CFO Jason Wheeler in 2017. Other departures include Chris Lattner, who left after leading Tesla’s Autopilot engineering team for less than six months, Lyndon and Peter Rive, Kurt Kelty and and Diarmuid O’Connell.

Model 3 Tesla

TESLA UNDER PRESSURE

Tesla is expected to report production and deliveries results for its Model 3 Sedan, which has faced challenges including quality issues and a production halt.

Elon Musk, the company’s CEO, has delayed manufacturing goals several times for Model 3. Reuters said last week that Tesla had to temporarily suspend Model 3 factory lines in February to “improve automation” and “increase production rates.”

Additionally, Green Car Reports said on March 9 that the quality of the 2018 Tesla Model 3 is “terrible,” and that the build quality was “the worst we have seen on any new car from any maker over the last 10 years.”

WHAT’S NOTABLE

Tesla shareholders are expected to vote whether to approve CEO Musk’s $2.6B pay package, which the board recommends and proxy firms ISS and Glass Lewis do not, at a meeting of shareholders on March 21.

Musk has said that he will not accept the package unless the company reaches a market cap of $650B.

VOLKSWAGEN CHALLENGE

Tesla is also facing challenges from other automakers in the electric car space, including Volkswagen (VLKAY), which said it will equip 16 factories to produce electric vehicles by the end of 2022, compared with three currently.

As of next year, the group plans to roll out a new battery-powered model “virtually every month,” CEO Mathias Mueller said.

“When the technology and the price are right, customers are ready to change over. With the I.D. family, we will take the lead in the electric movement,” Volkswagen executive Herbert Diess said yesterday.

PRICE ACTION

Tesla dropped 2.2% to $334.42 in Wednesday’s trading.


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Micron Breaks Out!

Micron shares in ‘early stages of another major breakout

Micron Breaks Out. Stockwinners.com
Micron Breaks Out!

Shares of Micron (MU) are rising after two analysts raised their price targets on the stock, citing memory market changes and potential capital returns.

‘BUY THE BREAKOUT’

On Monday, Nomura Instinet analyst Romit Shah raised his price target for Micron Technology to $100 from $55 citing multiple expansion.

After consolidating over the last four months, Micron shares are in the “early stages of another major breakout,” Shah tells investors in a research note.

The analyst said he sees key catalysts for #Micron, including a resumption of an upward trend in dynamic random-access memory pricing in the second quarter, a first-time dividend and share buyback announcement in May, continued margin expansion in NAND and increased merger and acquisition discussions. #Shah expects another 10% increase in DRAM pricing over the next six months and an announcement by the company for a comprehensive capital return program that will show the management’s confidence in future cash flows.

In addition, Shah expects additional margin expansion in NAND in 2018 and 2019 as weaker prices are offset by a stronger mix and cheaper cost per bit.

The analyst also believes Micron stands out as a potential acquisition target as it is one of the few remaining U.S. chip companies that has scale, it is expanding its presence in NAND and its valuation looks attractive. The analyst kept a Buy rating on the name.

MEMORY MARKET CHANGES

In addition, Evercore ISI analyst C.J. Muse raised his price target on Micron to $80 from $60, stating that he thinks the memory market is “absolutely” different now with the DRAM industry consolidated to three players, all of whom are acting rational, and memory has become increasingly critical while the rising complexity has limited the magnitude of new supply.

His sense is that Micron will move forward with capital returns “regardless of what we hear from the rating agencies” and predicts the company’s analyst day on May 21 should bring more news about planned capital returns starting in fiscal year 2019. #Muse, who thinks Micron can earn $13 or more in earnings per share in calendar 2019, kept an Outperform rating on Micron shares.

PRICE ACTION

Micron rose 7.14%, or $3.90, to $58.49 in Monday morning trading.


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Clorox to acquire Nutranext for $700M

Clorox agrees to acquire Nutranext

Clorox agrees to acquire Nutranext. Stockwinners.com
Clorox agrees to acquire Nutranext. 

Clorox (CLX) announced that it has entered into a definitive agreement to acquire Nutranext, a health and wellness company based in Sunrise, Florida, which manufactures and markets leading dietary supplement brands in the retail and e-commerce channels as well as in its direct-to-consumer business.

The Nutranext acquisition brings significant scale and breadth to Clorox’s dietary supplements business.

It follows the company’s May 2016 acquisition of the RenewLife brand, a leader in digestive health. Clorox’s brand-building capabilities and retail execution behind the RenewLife brand have led to strong growth in the e-commerce channel and expanded distribution in the retail channel. In calendar year 2017, Nutranext generated sales of about $200M.

Clorox will pay $700M to acquire Nutranext, with the purchase price representing about 3.5 times calendar year 2017 sales.

The company expects to fund the transaction through a combination of available cash and debt financing, while maintaining a Debt/EBITDA ratio within its target range of 2.0x to 2.5x.

The transaction is subject to certain closing conditions, including customary regulatory approvals, and is expected to close in the company’s fiscal fourth quarter, which ends June 30, 2018.

Clorox’s preliminary estimates indicate the acquisition will dilute earnings per share by 7-11c in the fourth quarter of its current fiscal year, ending June 30, 2018, and by 8c-12c in fiscal year 2019 and be accretive to earnings per share in fiscal year 2020.


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Humana, WellCare dive after Cigna buys Express Scripts

Humana, WellCare fall Cigna agrees to buy Express Scripts for $67B

Cigna to acquire Express Scripts for $67B. Stockwinners
Cigna to acquire Express Scripts for $67B. 

Shares of Humana (HUM) and WellCare (WCG) are in the red after Cigna (CI) announced that it has agreed to acquire Express Scripts (ESRX) in a cash and stock transaction valued at about $67B.

Commenting on the news, Piper Jaffray argued that the deal makes it less likely in the near-term that Cigna would buy a Medicaid or Medicare Advantage plan.

EXPRESS SCRIPTS ACQUISITION:

Cigna and Express Scripts announced that they have entered into a definitive agreement whereby Cigna will acquire Express Scripts in a cash and stock transaction valued at approximately $67B, including Cigna’s assumption of approximately $15B in Express Scripts debt. The merger consideration will consist of $48.75 in cash and 0.2434 shares of stock of the combined company per Express Scripts share.

Upon closing of the transaction, Cigna shareholders will own approximately 64% of the combined company and Express Scripts shareholders will own approximately 36%. Upon closing, the combined company will be led by David Cordani as President and CEO. Tim Wentworth will assume the role of President, Express Scripts.

igna to acquire Express Scripts for $67B. Stockwinners
Express Scripts sold for $67B

MEDICAID, MA DEAL LESS LIKELY

Piper Jaffray analyst Sarah #James told investors that she does not foresee any issues with approval, even though a Cigna/Express Scripts combination would increase annual script volume to 848M, making it the third-largest pharmacy benefit manager.

However, the analyst noted that she does not expect Cigna’s script volume to transition over to a combined company until 2023 when its contract with UnitedHealth’s (UNH) OptumRx ends.

Nonetheless, James argued the deal makes it less likely that Cigna will buy a Medicaid or Medicare Advantage plan near-term, consistent with management’s softened language around using M&A to win long-term services and supports, or LTSS, contracts.

Two names that have been seen as potential targets in the sector are Humana and WellCare.

 Humana, WellCare dip after Cigna agrees to buy Express Scripts. Stockwinners
Humana, WellCare dip after Cigna buys Express Scripts 

WHAT’S NOTABLE:

Some Wall Street analysts had previously seen Cigna as a potential takeover target for Amazon (AMZN) as they speculated what the next step would be for the e-commerce giant, especially following its health care venture with Berkshire Hathaway (BRK.A., BRK.B) and JPMorgan (JPM).

 Humana, WellCare dip after Cigna agrees to buy Express Scripts. Stockwinners
Humana, WellCare dip after Cigna agrees to buy Express Scripts

PRICE ACTION

In Thursday’s trading, shares of Cigna have plunged about 9.5% to $175.90, while Express Script’s stock has gained over 11% to $81.63.

Shares of Humana are fractionally down to $272.27, and WellCare’s stock has slipped almost 1% to $193.03.


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Netflix introduces PIN protection, Shares jump

Netflix introduces PIN protection, enhancements for ‘informed’ viewing

Disney loss having minimal impact on Netflix subscribers. See Stockwinners.com Market Radar to read more
Netflix introduces PIN protection, enhancements for ‘informed’ viewing

Mike Hastings, a director of enhanced content at Netflix (NFLX), said in a blog post: “At Netflix, we offer a wide variety of series and films catering to an equally broad variety of tastes and sensibilities.

With that in mind, we are improving some long-standing Netflix features that provide members with the information and tools they need to make wise decisions about what’s right for themselves and for their families.

We’re rolling out these improvements across the many devices used by Netflix members, and across our global markets, in the coming months. The first change involves introducing a PIN parental control for individual movies and series to give parents and guardians more specific control over what children can watch on the service.

We understand that every family is different and that parents have differing perspectives on what they feel is appropriate to watch at different ages.

While we already provide PIN protection for all content at a particular maturity level for Netflix accounts, PIN protection for a specific series or film provides families with an additional tool to make decisions they are comfortable with.

In addition, we will also begin displaying more prominently the maturity level rating for a series or film once a member hits play on a title. While these maturity ratings are available in other parts of the experience, we want to ensure members are fully aware of the maturity level as they begin watching.

We are also continuing to explore ways to make this information more descriptive and easier for our members to understand with just a quick glance. One of the great benefits of internet TV is that it allows for amazing variety and provides viewers with complete control over their experience.

At Netflix, we are proud to create and deliver to our members a large catalog of compelling stories crossing many genres from all over the world, while also giving them great control over how and when to enjoy them.

These latest steps are part of our continuous efforts to keep members better informed, and more in control, of what they and their families choose to watch and enjoy on Netflix.”

NFLX is up $11.0 to $312.89.


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Student Transportation sold for $7.50 a share

Student Transportation to be acquired by investors led by CDPQ

Student Transportation sold for $7.50 a share. Stockwinners.com
Student Transportation sold for $7.50 a share.

Student Transportation (STB) announced that it entered into a definitive agreement with a company sponsored by Caisse de depot et placement du Quebec and Ullico Inc. pursuant to which the Purchaser Group will acquire all of the company’s outstanding common shares by way of a plan of arrangement under the Business Corporations Act.

Student Transportation Inc. (STB) provides school bus transportation and management services to public and private schools in North America. The company offers contracted, managed, special needs transportation, direct-to-parent, and charter services. It operates approximately 290 contracts with a fleet of 13,000 vehicles.

Shareholders of STI will receive $7.50 per common share in cash, representing a 27% premium to the 20-day volume weighted average price per common share on the Toronto Stock Exchange for the period ending February 27, 2018, based on an exchange rate of $1.2776 Canadian dollars per U.S. dollars as of February 27, 2018.

Holders of STI’s 6.25% Convertible Unsecured Subordinated Debentures will receive the product of $7.50 and the number of Common Shares that the holders would be entitled to receive upon the conversion of their 2013 Debentures in accordance with their terms immediately following the closing date of the Arrangement, including those issuable upon a “Cash Change of Control”, plus the sum of accrued and unpaid interest on such debentures up to but excluding the Closing Date and the interest that would have otherwise accrued from and including the Closing Date to but excluding 32 days thereafter.

Holders of STI’s 5.25% Convertible Unsecured Subordinated Debentures will receive the product of $7.50 and the number of Common Shares that the holders would be entitled to receive upon the conversion of their 2016 Debentures in accordance with their terms immediately following the Closing Date, including those issuable upon a “Cash Change of Control”, plus the sum of accrued and unpaid interest on such debentures up to but excluding the Closing Date and the interest that would have otherwise accrued from and including the Closing Date to but excluding 32 days thereafter.


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Positive data reported on uterine fibroids

Phase 3 ELARIS UF-I study of elagolix met primary endpoint

Phase 3 ELARIS UF-I study of elagolix met primary endpoint. Stockwinners.com
Phase 3 ELARIS UF-I study of elagolix met primary endpoint.

AbbVie (ABBV) in cooperation with Neurocrine Biosciences (NBIX), announced that the Phase 3 ELARIS UF-I study of elagolix met its primary endpoint.

Results from the first of two pivotal Phase 3 studies demonstrated at month six that elagolix, in combination with low-dose hormone (add-back) therapy, reduced heavy menstrual bleeding with 68.5 percent (pless than 0.001) of women with uterine fibroids achieving clinical response compared to placebo (8.7 percent), as measured by the alkaline hematin method.

Uterine fibroids are noncancerous growths of the uterus that often appear during childbearing years. Also called leiomyomas (lie-o-my-O-muhs) or myomas, uterine fibroids aren’t associated with an increased risk of uterine cancer and almost never develop into cancer.

Fibroids range in size from seedlings, undetectable by the human eye, to bulky masses that can distort and enlarge the uterus. You can have a single fibroid or multiple ones. In extreme cases, multiple fibroids can expand the uterus so much that it reaches the rib cage. Many women have uterine fibroids sometime during their lives. But most women don’t know they have uterine fibroids because they often cause no symptoms.

Clinical response was defined as menstrual blood loss volume of less than 80 mL during month six and a 50 percent or greater reduction in menstrual blood loss volume from baseline to month six.

The study also met all ranked secondary endpoints (pless than 0.001) at month six.

Both stocks are higher in pre-market trading.


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Fogo De Chao sold for $560 million

Fogo De Chao to be acquired by Rhone for $15.75 per share in cash

Fogo De Chao to be acquired by Rhone for $15.75 per share in cash. Stockwinners.com
Fogo De Chao to be acquired by Rhone for $15.75 per share in cash.

Fogo de Chao (FOGO) announced an agreement to be acquired by investment entities affiliated with Rhone Capital.

Under the terms of the agreement, Rhone will acquire the Company in an all cash transaction valued at $560M.

The Company’s stockholders will receive $15.75 per share, representing a 25.5% premium to the closing share price of the Company’s shares on February 16, 2018.

The transaction is the result of a comprehensive strategic alternatives review process taken by the Company’s Board of Directors.

The transaction has been unanimously approved by Fogo’s Board of Directors. Funds affiliated with Thomas H. Lee Partners, L.P. and certain of Fogo’s directors and executive officers, which collectively hold more than 60 percent of Fogo’s shares, have approved the transaction by written consent.

The acquisition is expected to be completed during the second calendar quarter of 2018, subject to regulatory approvals and other customary closing conditions.


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Qualcomm raises NXP Semiconductors offer to $127.50 a share

Qualcomm agrees with NXP Semiconductors to increase purchase price to $127.50/sh 

Qualcomm agrees with NXP Semiconductors to increase purchase price to $127.50/sh. Stockwinners.com
Qualcomm raises NXP Semiconductors offer  to $127.50/sh 

Qualcomm (QCOM) announced that Qualcomm River Holdings, an indirect wholly owned subsidiary of Qualcomm, has reached an agreement with NXP Semiconductors N.V. (NXPI) to increase to $127.50 per share its previously announced cash tender offer to purchase all outstanding shares of NXP.

The amended agreement, which was approved by the Qualcomm and NXP Boards of Directors, also lowers the minimum tender condition from 80% of NXP’s outstanding shares to 70%.

Qualcomm also announced that Qualcomm River Holdings B.V. has entered into binding agreements with nine NXP stockholders who collectively own more than 28% of NXP’s outstanding shares (excluding additional economic interests through derivatives) to tender their shares at $127.50 per share.

These stockholders include funds affiliated with Elliott Advisors Limited and Soroban Capital Partners LP. Under the terms of the revised agreement, the currently pending tender offer of Qualcomm River Holdings B.V. to acquire all of the issued and outstanding shares of NXP will be amended as described above and the expiration time for the offer will be extended to the end of day, one minute after 11:59 p.m. New York City time, on March 5, 2018.

Qualcomm intends to fund the additional consideration with cash on hand and new debt. The amended tender offer is not subject to any financing condition.

The offer is conditioned on at least 70% of the outstanding ordinary shares of NXP being validly tendered and not withdrawn prior to the expiration of the offer.

Qualcomm’s acquisition of NXP has received antitrust clearance from eight of the nine required government regulatory bodies around the world. The transaction remains contingent on clearance from the Ministry of Commerce in China. Qualcomm is optimistic it will receive MOFCOM clearance in the near term.


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Barron’s in bullish on Citi, bearish on GE

Barron’s, the weekly publication owned by the Wall Street Journal, in its latest issue mentions several names:

Stockwinners offers Barron's review of Stockwinners offers stocks to buy, stocks to watch, upgrades, downgrades, earnings, Stocks to Buy On Margin
Stockwinners offers Barron’s review of stocks to buy, stocks to watch

BULLISH   MENTIONS: 

Hovnanian (HOV) stock too cheap to ignore- Hovnanian Enterprises offers an interesting speculative bet, because more than a decade’s worth of problems are reflected in the price, Brett Arends writes in this week’s edition of Barron’s. A successful resolution of its legal issues, a corporate turnaround, a takeover, or a continued recovery in the U.S. real estate market are all potential catalysts, he adds.

JPMorgan, Walmart cash flow yields exceed dividend yields – The cash flow yields of JPMorgan (JPM), Johnson & Johnson (JNJ), Walmart (WMT), Pfizer (PFE), Cisco (CSCO), AbbVie (ABBV), PepsiCo (PEP), 3M (MMM), Bristol-Myers (BMY), United Technologies (UTX), Texas Instruments (TXN) and Abbott Laboratories (ABT) exceed their dividend yields, a good signal for dividend coverage and growth, Lawrence Strauss writes in this week’s edition of Barron’s.

Alphabet, Citi well positioned for later stages of market rally – It is time for investors to think about how and when bull markets end, Jack Hough writes in this week’s edition of Barron’s. Groups to favor now include financials, which benefit from rising interest rates, and industrials, he notes, adding that technology still looks attractive. Alphabet (GOOG; GOOGL), Lam Research (LRCX), Citigroup (C), and Cummins (CMI) are all well positioned for the later stages of a long market rally, Hough contends.

Bears, bulls battle over Under Armour – In a follow-up story, Barron’s says that Under Armour (UA) reported fourth quarter revenue that beat Wall Street’s estimate, but is difficult to tell whether the revenue upside represents a turning point for the business. Bulls and bears both found something to support their arguments, as revenue increased but gross margin declined while inventories swelled and store count rose 22%, the report notes.

BEARISH  MENTION:

General Electric stock could drop another 10% – General Electric (GE) lost $6B in 2017 after a series of charges and impairments, cut its dividend by 50%, and its accounting is under investigation by the Securities and Exchange Commission, but lately it has been attracting fresh attention from value-oriented investors, Andrew Bary writes in this week’s edition of Barron’s. Nonetheless, the stock is not a bargain and could drop another 10% or more, he contends


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Intel says 32 lawsuits have been filed against company

Intel says 32 lawsuits have been filed against company over security flaws

Intel says 32 lawsuits have been filed against company. Stockwinners.com
Intel says 32 lawsuits have been filed against company
In a regulatory filing, Intel (INTC) said that “On January 3, 2018, information on the security vulnerabilities was publicly reported, before software and firmware updates to address the vulnerabilities were made widely available.
Numerous lawsuits have been filed against Intel and, in certain cases, our executives and directors, in U.S. federal and state courts and in certain courts in other countries relating to the Spectre and Meltdown security vulnerabilities.
As of February 15, 2018, 30 customer class action lawsuits and two securities class action lawsuits have been filed.
The customer class action plaintiffs, who purport to represent various classes of end users of our products, generally claim to have been harmed by Intel’s actions and/or omissions in connection with the security vulnerabilities and assert a variety of common law and statutory claims seeking monetary damages and equitable relief.
The securities class action plaintiffs, who purport to represent classes of acquirers of Intel stock between July 27, 2017 and January 4, 2018, generally allege that Intel and certain officers violated securities laws by making statements about Intel’s products and internal controls that were revealed to be false or misleading by the disclosure of the security vulnerabilities.
Additional lawsuits and claims may be asserted on behalf of customers and shareholders seeking monetary damages or other related relief. We dispute the claims described above and intend to defend the lawsuits vigorously.
Given the procedural posture and the nature of these cases, including that the proceedings are in the early stages, that alleged damages have not been specified, that uncertainty exists as to the likelihood of a class or classes being certified or the ultimate size of any class or classes if certified, and that there are significant factual and legal issues to be resolved, we are unable to make a reasonable estimate of the potential loss or range of losses, if any, that might arise from these matters.
In addition to these lawsuits, in January 2018, Joseph Tola, Joanne Bicknese, and Michael Kellogg each filed a shareholder derivative action in the Superior Court of the State of California in San Mateo County against certain members of our Board of Directors and certain officers.
The complaints allege that the defendants breached their duties to Intel in connection with the disclosure of the security vulnerabilities and the failure to take action in relation to alleged insider trading.
The complaints seek to recover damages from the defendants on behalf of Intel.”


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CSRA sold for $9.6 billion

General Dynamics to acquire CSRA for $40.75 per share or $9.6B in cash 

CSRA sold for $9.6 billion. Stockwinners.com
CSRA sold for $9.6 billion

General Dynamics (GD) and CSRA (CSRA) announced that they have entered into a definitive agreement under which General Dynamics will acquire all outstanding shares of CSRA for $40.75 in cash.

The transaction is valued at $9.6 billion, including the assumption of $2.8 billion in CSRA debt.

General Dynamics expects the transaction to be accretive to GAAP earnings per share and to free cash flow per share in 2019, and expects to generate estimated annual pre-tax cost savings of approximately 2% of the combined company’s revenue by 2020.

General Dynamics state: “We are committed to maintaining our strong credit ratings and using our robust cash flow for reduction of debt from the transaction, continuation of our dividend policy and the flexible deployment of capital, including ongoing investment in the business.”

CSRA Inc. delivers a range of information technology solutions and professional services to its U.S. government customers to modernize legacy systems, protect networks and assets, and enhance the mission-critical functions for war fighters and citizens. The company offers digital platforms and services, data and analytics, intelligent business processes, enterprise business services, and cyber security services.


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Amazon.com enters delivery business

Amazon.com to directly compete with United Parcel Service and FedEx

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Amazon.com to directly compete with United Parcel Service and FedEx

Amazon.com Inc. (AMZN) is preparing to launch a delivery service for businesses, positioning it to directly compete with United Parcel Service Inc. and FedEx Corp.

Amazon is planning to launch a delivery services for businesses called “Shipping with Amazon” that would compete with FedEx (FDX) and UPS (UPS), The Wall Street Journal reports.

The service would involve Amazon picking up packages from businesses and shipping them to consumers, people familiar with the matter say.

The tech giant expects to roll out the SWA service in Los Angeles “in the coming weeks” with third-party merchants that sell products through its website, the people say, and could expand the service to more cities as soon as this year.

Amazon’s business delivery is expected to roll out in Los Angeles in the coming weeks with third-party merchants that sell goods via its website. More cities are to follow.

UPS said it is still a partner of Amazon.

“UPS continues to support Amazon and many other customers and we don’t make comments about their business strategies or decisions regarding their utilization of UPS services,” a spokesperson for the company said.

In pre-market trading, FedEx is down about 2% and UPS dropped 3.5%.


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This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.