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Global Stocks Trending in the News for December 31, 2018

Dec 31, 2018

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Global Consumer Stocks Trending in the News

  • Amazon (AMZN) is in talks with the New York Yankees about buying the regional sports network YES from Disney (DIS), according to the Wall Street Journal.  The Yankees already own 20% of YES and have first rights on buying the rest.  Disney is said to be seeking USD$5-6 billion for the network.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.  Disney is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Amazon (AMZN) is making a big push in India to train shoppers on using its website.  Amazon has added Hindi and videos to its ordering screen to help residents on the Indian countryside, according to a report in the Wall Street Journal today.   Amazon is also adding small stores where shoppers can learn and a fleet of local delivery people what can accept payment when delivering.  Amazon is focused on the interior in Indian where 800 million people live and often d not have access to a retailer.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Canadian marijuana producer Aphria Inc. (TSX: APHA) said that a proposed CAD$2.8bn (USD$2.1bn) hostile offer by Green Growth Brands Ltd. is significantly undervalued. The proposed bid is roughly 23% below Aphria’s 20-day average share price. “The board has determined that the GGB proposal, as it currently stands, significantly undervalues the company,” said Aphria Chairman Irwin Simon. Aphria is not rated in our Global Top Stock Ideas.
  • Canada Goose (TSX: GOOS) opened its first store in China this past Friday.  The store is located in Shanghai and has seen heavy crowds since its opening.  This despite the diplomatic tension between Canada and China after Canada detained a Huawei executive at the US’s request.  Canada Goose is not rated in our Global Top Stock Ideas.
  • Distribuidora Internacional de Alimentacion SA (BME: DIA) shares are trading higher after reporting that it closed an agreement to refinance its bank debt, which will allow the grocer to continue its turnaround plan. The deal includes a new liquidity line of 200mm euros (USD$228mm) and the sale of two units. DIA is rated “Top Short” in our European SMID-Cap Global Top Stock Ideas. 
  • HMV Group (LSE: HMV) has filed for insolvency for the second time in 6 years after observing disappointing sales over the holiday period. The 97-year old music and entertainment retailer’s potential liquidation threatens 2,025 jobs. In January 2013, HMV entered insolvency procedures after the trend towards online streaming services dragged down sales. HMV is not rated in our Global Top Stock Ideas.
  • Phillip Morris International (PM) was reiterated as an overweight rating by Piper Jaffray on Friday.  Phillip Morris International price target of USD$110 implies a 65% upside.  Piper Jaffray says “Phillip Morris International’s cigarette business is strong with pricing power intact.”  Phillip Morris International is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and is rated “Neutral” in our US Consumer Discretionary Global Top Stock Ideas
  • Sony (SNY, TSE: 6758) said it will boost production of chips for next-generation 3D cameras for mobile phones after interest from phone manufactures.  Sony said it will ramp up mass production of the chips this summer when they will already be powering a number of mobile phones.  Sony did not give production estimates but said the unit is already profitable.  Sony is rated “Top Buy” in our Japan Large-Cap Global Top Stock Ideas.
  • On Friday, Tesla (TSLA) instituted the changes it agreed to with the US Securities and Exchange Commission.  The SEC required Tesla to add 2 new independent board members, who started on Friday.  Additionally, it wants CEO Elon Musk’s tweets monitored much more closely for inappropriate content.  Telsa is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.

Global Information Technology and Communication Services Stocks Trending in the News

  • The European Union (EU) has published draft guidelines for ethical artificial intelligence (AI) development that will impact tech giants like Alphabet Inc. (GOOGL) and Microsoft Inc. (MSFT). The EU plans to invest 1.5bn euro in AI by 2020 while working to ensure privacy and ethics in the process. Alphabet is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas. Microsoft is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • CenturyLink (CTL) suffered an outage in its data and voice management service that interrupted 911 service for millions of people.  The FCC said it is going to investigate the incident that was reported yesterday (see Verizon below).  The FCC action was reported in an email from the Chairman of the FCC, Ajit Pai.  CenturyLink is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Dell Technologies (DELL) returned to the public equity markets Friday with its stock relisted on the Nasdaq stock market.  JP Morgan rated Dell an overweight rating, describing it as “one of the largest, most comprehensive, most integrated product and service companies in the IT space”.  JP Morgan set Dell’s price target at USD$60, implying 33% upside.  Dell is not yet rated in our Global Top Stock Ideas.
  • Facebook’s (FB) recent data scandal has brought many criticisms of inaction at the Federal Trade Commission, according to a New York Times report today.  Facebook was not responsible for consultant’s misuse of Facebook user data, the Commission rules, rankling many proponents of stronger data protection rules.  Facebook is rated is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Tencent (TCEHY, SEHK: 700) was not the beneficiary of any approval for video games as China published approval for 80 new games titles.  China’s State Administration of Press, Publication, Radio, Film, and Television published the approvals online today.  China suspended approval of all new games earlier this year throwing a cloud of uncertainty over the sector.  Tencent Amazon is rated “Neutral” in our China All-Cap Global Top Stock Ideas.
  • Verizon (VZ) customers suffered nationwide telecom service disruption after CenturyLink, a contractor that handles data network traffic management for Verizon, suffered a failure in its network.  Verizon did not say how many people were affected but data and mobile service was affected in various parts of the United States.  Verizon is rated “Attractive” in our US Large-Cap Global Top Stock Ideas

Global Industrials Stocks Trending in the News

  • Airbus (ENXTPA: AIR) is reportedly doing everything possible to hit its 800-plane delivery target by year’s end. To hit its target, Airbus will need to deliver at least 127 aircrafts to customers in December. Airbus Marketing chief Christian Scherer and his team are reportedly still on the road, meeting with customers and chasing new orders. Airbus is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.
  • American Airlines (AAL) suffered flight cancellations and delays in New York after an electrical outage.  Its operations at LaGuardia airport were interrupted after the airport briefly lost power last night.  American Airlines canceled flights and delayed others as the airport switched to backup generators.  American flights were expected to return to normal on Friday.  American Airlines is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Industrials Global Top Stock Ideas.
  • Boeing (BA) has won an order for 11 737-Max jets from BOC Aviation Ltd. (SEHK: 2588), according to press reports out of Asia.  BOC Aviation Ltd. has signed a lease with unidentified airlines for the jets.  BOC Aviation Ltd. will have the option for an undisclosed number of additional jets from Boeing, according to the report.  BOC Aviation Ltd. is rated “Attractive” in our China All-Cap Global Top Stock Ideas.  Boeing is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Industrials Global Top Stock Ideas.
  • HMV Group (LSE: HMV) has filed for insolvency for the second time in 6 years after observing disappointing sales over the holiday period. The 97-year old music and entertainment retailer’s potential liquidation threatens 2,025 jobs. In January 2013, HMV entered insolvency procedures after the trend towards online streaming services dragged down sales. HMV is not rated in our Global Top Stock Ideas.
  • Jet Airways Limited (BSE: 532617) is reportedly in talks with the State Bank of India pertaining to a short-term 15bn rupee loan to meet working capital needs and current payment obligations. Reports by Press Trust of India highlights that Jet Airway’s partner Etihad may guarantee the loan. Jet Airways is rated “Top Buy” in our India All-Cap Global Top Stock Ideas.
  • Nissan (TSE: 7201) said it will cut car production by 20% on less China demand.  Nissan will cut production by 30,000 units in the next quarter, according to press reports.  Nissan produced 400,000 cars in China in the last quarter.  Also, ousted chairman Carlos Ghosn will remain in jail until January 19th as prosecutors won more detention time for him.  Mr. Ghosn has been detained since November 19th for alleged financial crimes related to his personal finances. Nissan is rated “Top Buy” in our Japan Large-Cap Global Top Stock Ideas.
  • Vestas Wind Systems A/S (CPSE: VWS) has received its first order from China State Power Investment Corporation, one of China’s five largest power companies. The order is a 19MW order of 4MW platform turbines. Additionally, the order includes a 5-year Active Output Management 4000 service agreement with delivery and commissioning expected to be completed in 3Q2019. Vestas Wind Systems is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.

Global Financials Stocks Trending in the News

  • Aflac (AFL) said it will enter reinsurance agreements on certain products with Singapore Life.  Aflac will make an initial USD$20mn minority investment in the concern as Aflac seeks to enter new markets.  Aflac describes the venture as a good example of its ability to leverage digital technology to enter new markets.  Aflac is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.
  • JPMorgan Chase & Co. (JPM) has been fined HK$12.5mm (USD$1.6mm) by the Hong Kong Monetary Authority for failing to meet anti-money laundering and counter-terrorist financing law requirements. JPMorgan Hong Kong reportedly violated 6 different provisions of the laws between April 2012 and February 2014 relating to lack of customer due diligence and improper handling of wire transfers. JPMorgan is rated "Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Wells Fargo (WFC) reached a settlement with 50 states and the District of Columbia over its past sales practices.  Wells Fargo will pay USD$575mn to settle issues with sales practices from 2002-2017 including opening fake accounts and charging unnecessary fees.  This settlement covers charges previously disclosed.  Wells Fargo is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.

Global Commodities Stocks Trending in the News

  • Consolidated Edison (ED), the electricity provider for New York City, suffered an explosion at a substation in Queens.  The explosion illuminated the night sky with a blue light that could be seen for miles.  Residents called police reporting a plane crash with some believing that aliens had landed.  The explosion cut electricity to LaGuardia airport temporarily.  Consolidated Edison is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • A Pacific Gas and Electric Co. (PCG) worker has been hospitalized following the explosion of a company transformer. California’s Division of Occupational Safety and Health will conduct an official investigation into the matter. PG&E is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Royal Dutch Shell (ENXTAM: RDSA) has officially completed the sale of its operations in New Zealand. The sale includes Royal Dutch Shell's Maui, Pohokura, and Tank Farm assets in addition to its interest in the Great South Basin venture. Royal Dutch Shell is rated “Top Buy” in our European Large-Cap Global Top Stock Ideas and “Attractive” in our United Kingdom All-Cap Global Top Stock Ideas. 
  • Transocean (RIG) has signed a five-year drilling contract and rig design and construction management contract with Chevron USA (CVX). The deal will see the completion of two ultra-deepwater drillships that are already under construction. The drilling contract alone is worth an estimated USD$830mm. Transocean is not rated in our Global Top Stock Ideas. Chevron is rated “Attractive” in our US Large-Cap Global Top Stock Ideas.

 

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