MA posts
Posted Jun 30th 2009 1:20PM by Tom Taulli
Filed under: Deals, Competitive strategy
Dan Duncan, who is a billionaire, understands the importance of patience (especially in creating lots of wealth). An example of this is his latest deal; that is, his company, Enterprise Products Partners LP (NYSE: EPD), has been pursuing Teppco Partners LP (NYSE: TPP) since March. At that time, Duncan offered about $2.8 billion for the company. And yes, according to the senior management at Teppco, it was too low.
Well, after some wrangling, there is now a deal. Of course, the price tag is higher -- at $3.3 billion (it's a stock-for-stock swap).
Continue reading Energy billionaire strikes again with Enterprise-Teppco deal
Posted Jun 26th 2009 5:00PM by Tom Taulli
Filed under: General Motors (GM), China
Forging a cross-border buyout deal is always difficult. But, it is even more complicated if the seller needs to get the deal done fairly quickly.
No doubt, this is the case with GM, which is in the process of unloading its Hummer unit. The interested buyer is Sichuan Tengzhong, which is based in China. The price tag on the deal: $500 million.
However, this week we got a bombshell; that is, the BBC reported that the Chinese government wanted to kill the deal.
Continue reading Hummer: Deal or no deal?
Posted Jun 26th 2009 11:00AM by Tom Johansmeyer
Filed under: Pfizer (PFE), JPMorgan Chase (JPM), Goldman Sachs Group (GS), Morgan Stanley (MS)
Mergers and acquisitions aren't delivering the fees that investment bankers used to enjoy, but fortunately, the money's coming from elsewhere. Data from Thomson Reuters reports a 29% increase in capital markets and M&A fees for the first time in more than a year. Share sales (e.g., rights offerings) were where dealmakers found the action. In the shrinking M&A space, Morgan Stanley (NYSE: MS) has taken the lead spot.
Since there are fewer banks in the marketplace than there were a year ago -- and they have less money -- the capital is starting to come from elsewhere. Because they aren't lending at their previous pace, companies are issuing bonds and equity to replenish their coffers. Pfizer (NYSE: PFE), for example, raked in more than $23 billion from the bond market to fund its acquisition of Wyeth (NYSE: WYE), and Roche nabbed Genentech with the help of a $30 billion debt issuance.
Continue reading M&A plunges, investment banks find money elsewhere
Posted Jun 18th 2009 3:40PM by Todd Harrison
Filed under: MasterCard Inc'A' (MA), CA Inc (CA), Stocks to Buy, NASDAQ
This post was written by Minyanville contributor Quint Tatro
While the Philly Fed Numbers's are just about unbelievable, in the real sense of the word, it has been enough to halt the slide at least for now. Regardless of the back and forth, I continue to be sitting on my hands watching as the market discourages those trying to find a shorter term edge. I stand firmly planted in the land of the Swiss, with a thesis that before the next swing tradeable move, Mr. Market will do a great job in depleting as much emotional capital as he can. My one current short in
the FlexFolio,
Mastercard (NYSE:
MA)still looks good and with a stop above 175 still presents some decent risk reward.
Going into the afternoon, I am keeping my eye on
CA Incorporated NASDAQ:
CA)and
FLIR Systems (NASDAQ
:FLIR) with alerts to enter short on a break of the day low. If they trigger, my stops will be the day high.
Enjoy the break, don't get caught up in the ticks and keep the emotional capital at highs. We're going to need it soon.
Posted Jun 18th 2009 1:50PM by Steven Mallas
Filed under: Earnings reports, American Express (AXP), MasterCard Inc'A' (MA), Visa Inc. (V)
Discover Financial Services (NYSE:
DFS), a credit-card company that competes with
Visa (NYSE:
V),
MasterCard (NYSE:
MA), and
American Express (NYSE:
AXP), reported earnings for the second quarter. According to this
news summary, Discover beat expectations by posting a loss of $0.18 per share. The market thought that the loss would be as high as $0.29 per share.
If you read the actual press release, you'll see that Discover, on a reported basis, made $0.43 per share. However, we must remember that this profit included an antitrust settlement sourced to Visa and MasterCard. So, once you get rid of that money, you come up with a loss for the quarter.
Continue reading Discover Financial Services beats in Q2 -- buy the stock?
Posted Jun 11th 2009 12:45PM by Eric Buscemi
Filed under: Analyst reports, Analyst upgrades and downgrades, Bank of New York (BK), MasterCard Inc'A' (MA), Analyst initiations, American Eagle Outfitters (AEO)
Analyst upgrades:
- Keefe Bruyette upgraded Bank of America (NYSE:BAC) to Outperform from Market Perform due to valuation and the company's better balance sheet following capital raises. The firm raised its target on shares to $16.50.
- Merriman upgraded Blue Coat Systems (NASDAQ:BCSI) to Buy from Neutral to reflect stabilizing demand and merger synergies from the Packeteer acquisition.
- Thomas Weisel upgraded Genomic Health (NASDAQ:GHDX) to Overweight from Market Weight based on valuation, a new colon cancer assay expected in 2010, and upside from new sales hires.
- Plexus (NASDAQ:PLXS) was upgraded to Outperform from Neutral at Baird.
- Great Plains Energy (NYSE:GXP) was raised to Buy from Neutral at Goldman.
- Ericsson (nASDAQ:ERIC) was upgraded at Societe Generale to Buy from Hold.
Continue reading Analyst upgrades, downgrades and initiations: BAC, ERIC, UNH, WRC
Posted Jun 5th 2009 8:00AM by Tom Taulli
Filed under: BHP Billiton Ltd ADR (BHP), Rio Tinto plc ADS (RTP)

It was certainly a big-time bet: Chinalco agreed to invest a whopping $19.5 billion in
Rio Tinto (NYSE:
RTP), which is the #3 ore miner. However, over the past couple months, there was some doubt as to whether this transaction would come to fruition.
Well, this week, we got an answer. That is, Rio decided to dump Chinalco and instead
form a joint venture (JV) with
BHP Billiton (NYSE:
BHP), which is the #2 player in the global ore industry (keep in mind that both firms had a buyout deal that blew up last year).
Now, the JV has lots of merit. For example, there will be huge cost synergies, which could amount to more than $10 billion.
Continue reading Rio Tinto passes on $19.5 billion
Posted May 6th 2009 2:30PM by Tom Taulli
Filed under: Dell (DELL), Oracle Corp (ORCL)
Back in 2002 to 2003, Oracle's (NASDAQ: ORCL) CEO, Larry Ellison, realized that the tech industry was maturing -- and the best strategy would be to engage in aggressive mergers & acquisitions (M&A). It was certainly prescient.
However, other major tech operators have been slow to the game. Just look at Dell (NASDAQ: DELL). While the company has struck some deals -- such as for EqualLogic in 2007 -- the activity has been muted.
Continue reading Dell gears up for M&A action
Posted May 4th 2009 12:00PM by Eric Buscemi
Filed under: Analyst reports, Analyst upgrades and downgrades, Intel (INTC), Adobe Systems (ADBE), MasterCard Inc'A' (MA), Research in Motion (RIMM), Burger King Hldgs (BKC), Analyst initiations, Urban Outfitters (URBN)
Analyst upgrades:
- Jefferies upgraded Cytec Industries (NYSE: CYT) to Buy from Hold on valuation and believes liquidity concerns are overdone. The firm raised its target on the stock to $27 from $20.
- Morgan Stanley upgraded Intel (NASDAQ: INTC) to Overweight from Equal Weight and raised its price target to $19 from $15. Morgan Stanley's survey indicates positive trends in the business supply chain and the analysts expects estimates to move higher from increased server MPU sales and growth in Windows 7.
- Pali upgraded Urban Outfitters (NASDAQ: URBN) to Buy from Neutral on valuation and believes the company's tough Q2 compares are already priced into the stock. The firm has a $25 target on shares.
- Research in Motion (NASDAQ: RIMM) was upgraded to Conviction Buy from Buy at Goldman.
- MasterCard (NYSE: MA) was lifted to Buy from Hold at Deutsche Bank.
- Burger King (NYSE: BKC) was raised to Buy from Neutral at Banc of America/Merrill.
Continue reading Analyst upgrades, downgrades and initiations: INTC, RIMM, BKC, MA, ADBE ...
Posted May 1st 2009 2:00PM by Tom Taulli
Filed under: Citigroup Inc. (C)
Since the 1980s, Sandy Weill spent billions on deal-making to build the Citigroup (NYSE: C) empire. Now it is in the process of being dismantled. The company has little choice as it must deal with its precarious capital base (the firm is the beneficiary of $45 billion in federal government loans).
So this week, Citigroup announced a deal to sell a variety of its Nikko units to Sumitomo Mitsui Financial Group for roughly $7.9 billion or 774.5 billion yen. Keep in mind that Citigroup purchased the division in 2007 for 1.6 trillion yen. Yes, it's a big-time haircut.
Nikko is a major player in the Japanese marketplace, with operations in brokerage and underwriting. In fact, the sale is going to be a game-changer in Japan as Sumitomo will have now more scale against rivals like M.U.F.G. and Mizuho Financial Group.
Continue reading Citigroup starts to dismantle its far-flung empire
Posted Apr 30th 2009 9:30AM by Steven Mallas
Filed under: Earnings reports, American Express (AXP), MasterCard Inc'A' (MA), Visa Inc. (V)
Visa (NYSE: V), whose colleagues include American Express (NYSE: AXP), MasterCard (NYSE: MA), and Discover Financial Services (NYSE: DFS), reported a Q2 profit on Wednesday that was surprisingly strong. On an adjusted basis, earnings came in at 73 cents per share. Analysts were banking on only 64 cents per share, according to Reuters.
Quite frankly, I can see the disparity between Wall Street's thinking and the ultimate reality. I mean, the economy has been bad (to state the obvious), and people aren't spending as much. This means that they aren't using their credit cards like they used to. Ergo, you might expect Visa to post a lower number.
Continue reading Let's give Visa some credit for its Q2 performance
Posted Apr 27th 2009 1:00PM by Melly Alazraki
Filed under: Walgreen Co (WAG), Novartis AG ADS (NVS), Baxter Intl (BAX), CVS Corp (CVS), Hormel Foods (HRL), Tyson Foods'A' (TSN), Smithfield Foods (SFD), Gilead Sciences (GILD), Agriculture

I remember Toronto during SARS. As one of the harder hit areas, it was not a happy place. It was the end of winter, but that miserable, cold winter just didn't want to end. People walked the streets in a gloomy haze, afraid to take the subway and giving dirty looks to anyone brazen enough to cough in public. Worse, I couldn't even visit a friend in the hospital. All things considered though, in global pandemic terms, it was over relatively quickly. Let's hope swine flu will be the same.
In the meantime, let's put on our investors hats and see what's in store for some stocks:
Travel and tourist stocksThis is one of the worst hit areas, especially airlines, as people may cancel their travel plans. For example,
AMR Corp. (NYSE:
AMR) traded over 9 percent lower an hour after the open.
Royal Caribbean Cruises (NYSE:
RCL) was down over 15 percent. In fact UBS downgraded these airlines and hotels this morning: AMR,
Continental Airlines (NYSE:
CAL),
Host Hotels and Resorts (NYSE:
HST),
Lasalle Hotel Properties (NYSE:
LHO),
Marriott (NYSE:
MAR),
United Airlines (NASDAQ:
UAUA),
US Airways (NYSE:
LCC).
Carnival Cruise Lines (NYSE:
CCL) also declined considerably. Best to stay away from the sector.
Continue reading Don't fear the swine flu . . . trade it
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