Continue reading Citigroup Upgrades Royal Bank of Scotland, Downgrades Barclays

Citigroup Upgrades Royal Bank of Scotland, Downgrades Barclays originally appeared on BloggingStocks on Fri, 10 Sep 2010 10:20:00 EST. Please see our terms for use of feeds.

Do you feel good about $173 billion of your tax money helping to keep American International Group (NYSE: AIG) from going bust? If you made the decisions that put AIG at death's door you might be. But the odds are pretty good that you had absolutely nothing to do with AIG's failure and received not a penny of compensation during the time when its executives were reporting profits -- and getting millions in compensation that they're not paying back now that it's losing money.

That's one of the reasons why I was arguing on KCRW's To the Point that the U.S. ought to disclose who is getting the taxpayer money that goes to AIG. After all, they just got another $30 billion this week after reporting history's biggest quarterly loss of $61 billion. A professor on the program suggested that we should not disclose the names of the recipients because it would threaten the stability of the financial system. I thought this professor's argument was unpersuasive -- and now we'll get a chance to see who was right.

Continue reading How much of AIG's $173 billion bailout went to European banks?

How much of AIG's $173 billion bailout went to European banks? originally appeared on BloggingStocks on Sat, 07 Mar 2009 14:42:00 EST. Please see our terms for use of feeds.

Back on May 21st, the $34.1 billion buyout deal for BCE (NYSE: BCE) looked bleak. A Quebec court ruled that the process had to stop -- so as to evaluate the impact on bondholders. As a result, BCE's stock price plunged from $37.83 to $33.10.

Of course, the decision was immediately appealed to Canada's Supreme Court. And, it was a savvy move. Today, the high court agreed to allow the BCE deal to move forward (this is according to a report in the Wall Street Journal, which is a paid publication). In fact, there was no rationale provided (instead, this will be provided at a later date).

However, there are still headwinds on the buyout. Simply put, the credit crunch is still lingering and making it extremely difficult to pull off mega financings. The banks on the deal include Citigroup (NYSE: C), Deutsche Bank (NYSE: DB), Royal Bank of Scotland, and Toronto-Dominion Bank. Of course, they don't want to sustain any more losses on their balance sheets.

Then again, this does not mean the deal will fall apart. Rather, there will likely be pressure to renegotiate the price tag on the transaction. After all, this is what happened with the buyout of Clear Channel.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

BCE buyout gets a good call from Canada's Supreme Court originally appeared on BloggingStocks on Sat, 21 Jun 2008 08:40:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Chip suppliers for cellphones including Qualcomm Incorporated (NASDAQ: QCOM), Texas Instruments Incorporated (NYSE: TXN) and Nvidia Corporation (NASDAQ: NVDA) are moving aggressively to make products for Intel Corporation's (NASDAQ: INTC) new breed of pocket-size portable devices, called MIDs, the Wall Street Journal reported.

• According to the UK Times, Barclays Plc (NYSE: BCS) and The Royal Bank of Scotland Group Plc (NYSE: RBS) were raided by the Office of Fair Trading as part of the investigation into price fixing loans to professional services firms.

• Almost three dozen of the largest U.S. companies may have to slash their dividends, since the dividends greatly exceed their cash flow, Bloomberg reported. Large companies in this situation include General Motors Corporation (NYSE: GM), Motorola Inc (NYSE: MOT), and The New York Times Company (NYSE: NYT).
• China Telecom Corporation Limited (NYSE: CHA) may announce today that it has bought the mobile phone assets of China Unicom Limited (NYSE: CHU) and its parent company for more than $14.4B, Bloomberg reported, citing the South China Morning Post. China Unicom could say that it is merging with China Netcom Group Corporation (NYSE: CN) as early as today, the newspaper added.

Newspaper wrap-up: Barclays and RBS raided by Office of Fair Trading originally appeared on BloggingStocks on Mon, 02 Jun 2008 08:00:00 EST. Please see our terms for use of feeds.

If we needed another sign that private equity is passe, we need go no further than to look at the current issue of Fortune, which shares a parent, Time Warner Inc. (NYSE: TWX), with BloggingStocks. To be fair, Fortune added an update to its web site about the tottering deal. It's a shame because the Fortune article paints such a glowing portrait of Providence Equity Partner's CEO Jonathan Nelson and praises him for doing the biggest deal ever -- the $51 billion takeover of Bell Canada parent BCE (NYSE: BCE) whose stock is down 5.7% this morning.

Regrettably for Nelson and Fortune, the New York Times reports this morning that the deal looks to be imperiled. It quotes one executive who read the revised bank terms: "It's patently obvious that the banks have no intention of closing the deal." These banks -- led by Citigroup Inc. (NYSE: C), Deutsche Bank, and the Royal Bank of Scotland -- sent revised terms to the consortium of buyers. which included higher interest rates, tighter loan restrictions and stronger protections for the banks, far exceeding the original terms.

Fortune has a photo of Nelson sitting in a comfortable chair with his hands in a position that communicates "I am smarter than you." It will be interesting to see whether he can use those smarts to close this $51 billion deal. If he does, then he will certainly deserve the encomiums that Fortune heaps on him. Fifteen months ago I appeared on CNBC to discuss whether private equity had peaked. I think Fortune's Private Money 2008 package answers that question in the affirmative -- with the cover story jinx.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns Citigroup shares and has no financial interest in the other securities mentioned.

Is the bell tolling for Providence Equity Partners' $51 billion Bell Canada buyout? originally appeared on BloggingStocks on Mon, 19 May 2008 11:40:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• According to people familiar with American International Group Inc's (NYSE: AIG) board, some directors feel that another big loss in the current quarter could prompt them to re-evaluate their support for CEO Martin Sullivan. The sources said a decision on Sullivan's fate isn't likely to be made until the company sees results over the next several months, the Wall Street Journal reported.
• The Financial Times reported that Kohlberg Kravis Roberts, The Blackstone Group LP (NYSE: BX) and Apax Partners are among the private equity groups that have been blocked from bidding int he first round of the GBP7B auction of The Royal Bank of Scotland Group Plc's (NYSE: RBS) insurance business.

• The Boeing Company (NYSE: BA) closed a helicopter production line for several hours yesterday due to possible irregularities found in two military helicopters, the Seattle Times reported. The company did not disclose exactly why it shut down the production of the H-47 Chinooks.

• According to Mac Rumors, citing French LeMatin.ch, a source in Swisscom AG (OTC: SCMWY) said Switzerland will be getting the iPhone device from Apple Inc (NASDAQ: AAPL) this summer, and it will feature GPS, Video Conferencing and Mobile TV.

Newspaper wrap-up: Boeing temporarily shuts down helicopter production line originally appeared on BloggingStocks on Wed, 14 May 2008 08:00:00 EST. Please see our terms for use of feeds.

RBS seen cutting 7,000 investment banking jobs originally appeared on BloggingStocks on Mon, 28 Apr 2008 13:38:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Warren Buffett's Berkshire Hathaway Inc (NYSE: BRK.A) and Mars are in talks to purchase Wm. Wrigley Jr. Co. (NYSE: WWY) for over $22B, the Wall Street Journal reported. An announcement may come as soon as today.
• The Royal Bank of Scotland Group Plc (NYSE: RBS) will start the integration of ABN Amro Holding's (NYSE: ABN) investment bank into its global markets division, the Financial Times reported. This process will most likely result in the paring of 7,000 jobs.

• According to the New York Post, IAC/InterActiveCorp. (NASDAQ: IACI) Chairman Barry Diller is expected to meet with his board this week to restart the process of breaking up his company into five separate pieces, sources said. At the same time, Diller and Liberty Media Corporation (NASDAQ: LMDIA) Chairman John Malone are continuing to talk about a deal that would trade one or more of IAC's assets for Liberty's ownership stake in IAC.
• The UK Times has learned that Numis Securities, the stockbroking group headed by Michael Spencer, is in "advanced talks" to buy the UK equities business of The Bear Stearns Companies Inc (NYSE: BSC). Numis may look to hire a team of 25 from Bear.

Newspaper wrap-up: Buffett, Mars to buy Wm. Wrigley originally appeared on BloggingStocks on Mon, 28 Apr 2008 08:40:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• In an effort to refocus on coffee, the Wall Street Journal reported that Starbucks Corporation (NASDAQ: SBUX) will attempt overhaul its entertainment business.
• Private equity players Apax Partners and Kohlberg Kravis Roberts, along with Lehman Brothers Holdings Inc (NYSE: LEH) in a supporting role, are looking to form a consortium to examine a bid for the insurance assets of The Royal Bank of Scotland Group Plc (NYSE: RBS), the Financial Times reported.

• Yahoo! Inc (NASDAQ: YHOO) is going to let outside developers create applications across its network of sites, the New York Times contended. The search engine is also going to combine its online services under the social profile concept in an attempt to allow its users to replicate the social experience that social networks like News Corporation's (NYSE: NWS) MySpace and Facebook have made so popular.

• Research In Motion Limited (NASDAQ: RIMM) will reportedly delay the launch of its new hotly anticipated 3G BlackBerry phone, Fortune reported, which the company is developing for AT&T Inc (NYSE: T). The phone, originally supposed to be launched in June, may not be released until as late as August, inside sources said.

Newspaper wrap-up: New 3G BlackBerry may be delayed until August originally appeared on BloggingStocks on Fri, 25 Apr 2008 08:05:00 EST. Please see our terms for use of feeds.

Continue reading RBS's recapitalization seen renewing bank sector writedown concerns

RBS's recapitalization seen renewing bank sector writedown concerns originally appeared on BloggingStocks on Tue, 22 Apr 2008 12:48:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Private equity firm Corsair Capital and several of the banks bigger shareholders are expected to inject over $6B into Cleveland regional bank National City Corporation (NYSE: NCC), the Wall Street Journal reported.
• According to sources, the Financial Times reported that Bank of America Corporation (NYSE: BAC) is planning to sell a portion of its 9% stake in China Construction Bank in order to raise capital. However, Bank of America will offset some of the share sales by exercising options it holds to buy additional stakes in the bank at levels that are now well below market rates.

• The UK Times said The Royal Bank of Scotland Group Plc (NYSE: RBS) confirmed that it is considering a rights issue that is expected to raise up to GBP10B for the British bank.
• The UK Telegraph reported that the BBC is talking to private equity firms to join in a bid for Virgin Media Inc's (NASDAQ: VMED) Virgin Media Television, which owns a percentage of the UKTV content business that the BBC doesn't already own.

Newspaper wrap-up: National City expected to receive $6B-plus capital infusion originally appeared on BloggingStocks on Mon, 21 Apr 2008 08:57:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• The Wall Street Journal reported that New York state's attorney general, Andrew Cuomo, has launched an investigation into auction-rate securities and is seeking information from some of Wall Street's biggest institutions including UBS AG (NYSE: UBS), Citigroup Incorporated (NYSE: C) and Merrill Lynch & Co Inc (NYSE: MER), a person familiar with the matter said.
• According to the Financial Times, Deutsche Bank AG (NYSE: DB) and other investment banks are working on plans to develop a clearing house for the credit derivatives markets. In an attempt to reduce counterparty risk, the banks are trying to develop a system that would only allow institutions with strong capital bases and credible trading histories to clear trades in the credit default swap markets with a central counterparty.

• The news that The Royal Bank of Scotland Group Plc (NYSE: RBS) is planning a rights issue of between GBP5B and GBP12B received mixed reviews from British analysts and investors, the Telegraph reported. The analysts expect the bank to cut its dividend.

• DigiTimes reported that Nvidia Corporation (NASDAQ: NVDA) is planning to launch the GeForce 9600 GSO GPU in May to compete with Advanced Micro Devices' (NYSE: AMD) Radeon HD 3830, according to sources at graphics card makers.

Newspaper wrap-up: Mixed views of Royal Bank rights issue originally appeared on BloggingStocks on Fri, 18 Apr 2008 09:15:00 EST. Please see our terms for use of feeds.

For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Best Stocks for 2008 report.

"Banco Santander (NYSE: STD) is a 'swashbuckling Spaniard,'" jests Frida Ghitis, contributing editor for Global Investing.

In referring to her conservative favorite for 2008 she explains, "While the big ships of the financial industry struggled to weather a storm of their own creation in the credit markets, a solidly built craft sailed full speed ahead undeterred by the turbulence, proudly flying the Spanish flag into new and old markets.

"Banco Santander, which trades as an ADR in the US, apparently managed to tack clear of the siren call of easy subprime money in America. Instead, following in the tradition of the conquistadors, it went in search of new riches in the old world and the new.

"With branches in Europe, Africa, and the Americas, Grupo Santander has grown to become the largest bank in Europe by market capitalization, even as its competitors see their market cap wither during difficult times.

Continue reading Best Stocks for 2008: Latin America banks on Banco Santander (STD)

Best Stocks for 2008: Latin America banks on Banco Santander (STD) originally appeared on BloggingStocks on Sat, 22 Dec 2007 14:45:00 EST. Please see our terms for use of feeds.

Here are a few highlights of this past week's earnings coverage from BloggingStocks:

• Big Lots Inc. (NYSE: BIG) reported a record quarter due in part to improved distribution.
• Blyth Inc. (NYSE: BTH) trounced EPS estimates and raised its guidance.
• ConAgra Foods Inc. (NYSE: CAG) raised its earnings forecast for Q2 on strength in merchandising.
• Donaldson Co. (NYSE: DCI) beat estimates due to strength in international markets.
• J. Crew Group (NYSE: JCG) posted a solid quarter due to strength in both store and direct sales.
• Krispy Kreme Doughnuts Inc. (NYSE: KKD) narrowed its loss, but foresees further store closures.
• Liquidity Services Inc. (NASDAQ: LQDT) posted a strong quarter, benefiting from the sluggish economy.
• Merck & Co. Inc.'s (NYSE: MRK) earnings forecasts for 2007 and 2008 fall short of expectations.
• Netezza Corp. (NYSE: NZ) beat expectations of both earnings and revenue.
• Palm Inc. (NASDAQ: PALM) forecast a loss for the current quarter due to product delays.
• Royal Bank of Scotland's (NYSE: RBS) better-than-expected forecast buoyed European banks.
• SeaChange International (NASDAQ: SEAC) reported a profit when analysts expected a loss.
• Sigma Designs (NASDAQ: SIGM) had a "blowout" quarter, beating even the most optimistic analyst.
• SkillSoft (NASDAQ: SKIL) beat expectations of both earnings and revenue.
• Toll Brothers Inc. (NYSE: TOL) posted a lower-than-expected loss, its first quarterly loss in 21 years.

Also, Brian White looks at how loss of market share contributed to Dell Inc.'s (NASDAQ: DELL) recent results. Both Douglas McIntyre and Jim Cramer mull the effect on the cable industries of Comcast Corp.'s (NASDAQ: CMCSA) lowered guidance. And Target Corp. (NYSE: TGT) is among retailers warning about earnings in the current quarter.

Upcoming results to watch for include: H&R Block (NYSE: HRB), Kroger Co. (NYSE: KR), Costco (NASDAQ: COST), and Lehman Bros. (NYSE: LEH).

Visit AOL Money & Finance for more earnings coverage.

Earnings highlights: Revised forecasts for Merck, Comcast, Target, ConAgra originally appeared on BloggingStocks on Sun, 09 Dec 2007 09:40:00 EST. Please see our terms for use of feeds.

Barclays, UBS rise on Royal Scottish's not-too-shabby showing originally appeared on BloggingStocks on Thu, 06 Dec 2007 15:45:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Jefferies initiated Longtop Financial (NYSE:LFT) with a Buy rating and $29 target, as they expect strong earnings growth over the next several years from an acceleration in P&L performance and the company's attractive secular demand backdrop.
  
• Morgan Stanley resumed coverage of Royal Bank of Scotland (NYSE:RBS) with an Underweight rating, as they believe investors will begin to question the sustainability of the company's dividend as earnings fall.
  
• Oppenheimer views the outlook for W-H Energy Services (NYSE:WHQ) as compelling given its geographic expansion, international growth prospects, technological focus, and strong balance sheet. The firm started shares with a Buy rating and $73 target..

• HSBC initiated Diageo (NYSE:DEO) with an Overweight rating.
  
• Banc of America resumed coverage of the softlines retailing sector, starting shares of Urban Outfitters (NASDAQ:URBN) and Pacific Sunwear (NADAQ:PSUN) with Buy ratings and a $32 target and $20 target, and Aeropostale (NYSE:ARO) with a Neutral rating.

Analyst initiations: LFT, RBS and WHQ originally appeared on BloggingStocks on Tue, 04 Dec 2007 11:14:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Caris initiated shares of Athenahealth (NASDAQ: ATHN) with an Average rating and $26 target, as they believe an unachievable growth rate is priced into shares at current levels.
• Brocade Communications Systems (NASDAQ: BRCD) was initiated with a Neutral rating at UBS.
  
• Royal Bank of Scotland (NYSE: RBS) was initiated with an Underweight rating at Lehmen.
  
• JP Morgan resumed coverage of Human Genome Sciences (NASDAQ: HGSI) with a Neutral rating.

• Lazard resumed coverage of Zoran (NASDAQ: ZRAN) with a Hold rating and Sigma Designs (NASDAQ: SIGM) with a Buy rating.
  
• Stifel initiated Tortoise Energy Capital (NYSE: TYY) with a Buy rating and $32 target.
  
• HSBC initiated DSG International (OTC: DSITY) with an Overweight rating.

Analyst initiations: ATHN, BRCD, RBS and HGSI originally appeared on BloggingStocks on Thu, 01 Nov 2007 11:20:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY: Clayton, PharmaNet Development, Royal Bank of Scotland, Progressive Gaming and WSFS Financial were today's noteworthy downgrades:

• JMP Securities downgraded shares of Clayton Holdings Inc (NASDAQ: CLAY) to Market Perform from Outperform citing lack of visibility in the non-agency MBS market. William Blair also downgraded shares to Market Perform from Outperform after the company's in-line quarter, to reflect lowered estimates and uncertainty regarding a recovery time.
• Jefferies downgraded shares of PharmaNet Development Group Inc (NASDAQ: PDGI) to Hold from Buy as they believe departures of board and management executives have introduced new risk.
• The Royal Bank of Group PLC (NYSE: RBS) was lowered to Sell from Buy at Citigroup, as they are negative on the company's acquisition of ABN Amro Holding NV (NYSE: ABN).
• ThinkEquity downgraded shares of Progressive Gaming International Corporation (NASDAQ: PGIC) to Accumulate from Buy following Friday's announcement that it lost its post-trial motions and will proceed to appeals court in the Webb lawsuit. PGIC will have to post a $20M bond, which is more than the firm expected.
• B. Riley downgraded shares of WSFS Financial Corporation (NASDAQ: WSFS) to Neutral from Buy after they lowered their estimates to reflect the company's higher projected on-interest expense.

• Goldman removed Hewlett-Packard Company (NYSE: HPQ) from its Conviction Buy List.
• Calyon downgraded VeraSun Energy Corporation (NYSE: VSE) to Add from Buy.
• Merrill Lynch downgraded Aetna Incorporated (NYSE: AET) to Neutral from Buy.
• Friedman Billings downgraded Baker Hughes Incorporated (NYSE: BHI) to Market Perform from Outperform.

Analyst downgrades: CLAY, PDGI, RBS, PGIC and WSFS originally appeared on BloggingStocks on Mon, 29 Oct 2007 10:57:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Mattel Inc (NYSE: MAT) is expected to soon announce another recall of toys made in China, reported the Wall Street Journal.
• Merck and Co. Inc (NYSE: MRK) CFO Judy Lewent sold 200K shares for $10.3M from July 26 through Aug. 7, at an average price of $51.31 per share, reported Barron's Online's "Inside Scoop" column.
• The Royal Bank of Scotland (OTC: RBSPY)-led consortium seeking to purchase Dutch bank ABN Amro Holdings NV (NYSE: ABN) raised its stake in ABN to more than 3% between Friday and Monday, reported the Financial Times.

• The Independent reported that Barclays' (NYSE: BCS) bid for Dutch bank ABM Amro was approved by the Netherlands' Ministry of Finance yesterday.
• A highly publicized civilian nuclear deal with the U.S. still allows India to test nuclear weapons, according to Prime Minister Manmohan Singh, reported the Associated Press.

Newspaper wrap-up: Mattel (MAT) to recall more toys originally appeared on BloggingStocks on Tue, 14 Aug 2007 09:15:00 EST. Please see our terms for use of feeds.

RBS gets the chills with private equity lending originally appeared on BloggingStocks on Wed, 06 Jun 2007 12:37:00 EST. Please see our terms for use of feeds.