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Global Stocks Trending in the News for May 8th, 2019

May 08, 2019

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Global Consumer Stocks Trending in the News

  • Anheuser-Busch InBev (BUD) confirmed its plans for an IPO for its Asian arm.  Anheuser-Busch InBev confirmed the plans wile reporting first quarter results that beat expectations.   Inbev is looking at plans to list the Asian arm on the Hong Kong exchange and use the proceeds to pay down some of its large debt load.  InBev did not give details of valuation but analyst estimate the unit will be valued between $40 billion and $50 billion.  Inbev has a market cap of about $130 billion in total.  Anheuser-Busch InBev is rated “Neutral” in our European Large-Cap Global Top Stock Ideas
  • Aramark (ARMK) shares slipped after the company announced adjusted earnings guidance for FY2019 that trailed previously offered guidance. Aramark expects adjusted EPS of between $2.20 and $2.30 during FY2019 compared to between $2.30 and $2.40 previously offered. Aramark’s top-line revenue of $4.00 billion during its fiscal second quarter was in line with consensus of $4.01 billion. Aramark is rated “Neutral” in our US Large-Cap and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Coty (COTY) reported net revenue that missed consensus.  Coty fiscal third quarter net revenue of $1.99 billion trailed $2.06 billion.  Fiscal third quarter adjusted EPS of 13 cents came a touch ahead of 12 cents consensus.  Coty reaffirmed guidance for fiscal 2019 of adjusted operating income moderately below fiscal 2018.  Coty is rated “Unattractive” in our US Large-Cap and “Attractive” in our US Consumer Discretionary Global Top Stock Ideas.
  • Dean Foods Co. (DF) shares traded higher after CEO Ralph Sozzafava said that the firm has, “been in conversations with folks,” regarding potential strategic alternatives. CEO Sozzafava did warn, however, that, “it’s possible we won’t do anything and execute the plan we have.” Dean Foods is rated “Neutral” in our US SMID-Cap and “Top Short” in our US Consumer Staples Global Top Stock Ideas.
  • Ferrari (RACE) reported first quarter results that beat expectations.  Ferrari first quarter adjusted ebitda was 311 million euros, ahead of 279.2 million euros consensus.  Ferrari posted first quarter revenue of 940 million euros, beating 865.9 million consensus.  First quarter EPS of 0.95 euros beat 0.83 euros consensus.  Ferrari said it will introduce 5 new models in 2019.  Ferrari is rated “Top Buy” in our European Large-Cap Global Top Stock Ideas.
  • Lyft (LYFT) reported a 95% growth in revenue when it reported its first quarterly results.  Lyft reported $776 million in revenue in the first quarter of the year, a 95% hike that was greater than many analysts expected.  Lyft posted a $1.1 billion loss due to heavy stock-based compensation.  Its adjusted loss was $211.5 million, much better than the $274 million loss expected.  Lyft also announced an expanded partnership with Alphabet’s (GOOGL) Google unit Waymo to work more closely on self-driving cars.  Alphabet is rated “Top Buy” in our US Large-Cap and “Top Buy” in our US Information Technology Global Top Stock Ideas.  
  • Office Depot (ODP) reported full year adjusted ebitda that beat consensus.  Office Depot sees full yar adjusted ebitda of $525 million to $550 million while consensus is $525 million.  Full year sales are expected to be between $10.8 billion and $10.9 billion.  Office Depot reported first quarter adjusted EPS of 7 cents, beating 6 cents consensus.  Office Depot is rated “Neutral” in our US SMID-Cap and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Sony (TSE: 6758) shares rose by nearly 7% after the company announced quarterly earnings that beat the average analyst expectation. Sony generated an operating profit of 82.7 billion yen during the fiscal fourth quarter, well ahead of analyst consensus of 69.1 billion yen. Sony expects operating profit for the upcoming fiscal year of 810 billion yen, trailing consensus expectations of 843 billion yen. Sony is rated “Attractive” in our Japan Large-Cap Global Top Stock Ideas.
  • Tyson Foods (TSN) said today that it will introduce meatless protein product through 2019 as it looks to take on Beyond Meat (BYND).  Tyson held 6.5% of Beyond Meat and unloaded the shares just before its IPO last week, missing out on the 163% run-up in its first day of trading.  Tyson will introduce its meatless products on a limited basis mid-2019 with a more complete rollout later in the year.  Tyson Foods is rated “Neutral” in our US Large-Cap and “Attractive” in our US Consumer Staples Global Top Stock Ideas.  Beyond Meat is not yet rated in our Global Top Stock Ideas.

Global Information Technology and Communication Services Stocks Trending in the News

  • Advanced Micro Devices (AMD) said the US Department of Energy chose its chips for its next supercomputer.  Researchers at the Oak Ridge National Lab are building the supercomputer to work on artificial intelligence, weather patterns and subatomic particles.  The new machine with AMD chips will be 50 times faster than the current system when it comes online in 2021.  Advanced Micro Devices is rated “Top Short” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas.  
  • Alphabet’s (GOOGL) Google may introduce tools to limit tracking cookies, WSJ is reporting.  Google may introduce the tools for its Chrome browser at its developer conference next week.  The tools will limit cookies from third-party profit-seeking companies.  Importantly, the tools are not expected to hinder Google’s ability to collect user data.  Alphabet is rated “Top Buy” in our US Large-Cap and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Electronic Arts (EA) reported profit that beat consensus.  Electronic Arts fiscal fourth quarter adjusted EPS of $1.31 beat consensus of 96 cents.  Revenue of $1.36 billion beat consensus of $1.21 billion.  Electronic Arts gave fiscal first quarter guidance of a 5 cents per share loss, much better than the 23 cents per share loss that is present consensus.  Electronic Arts Arts gave fiscal full year EPS guidance of $5.37, well above $4.51 consensus.  Electronic Arts is rated “Neutral” in our US Large-Cap and “Attractive” in our US Information Technology Global Top Stock Ideas.  
  • Facebook (FB) COO Sheryl Sandberg spent today meeting with Senators on Capitol Hill as the company awaits news on up to a $5 billion fine from the Federal Trade Commission.  The meetings were set up a long time ago, Facebook said, and have nothing to do with the impending fine.  Sandberg is meeting with members of both parties and Congress discusses whether new privacy and data regulations.  Facebook is rated “Unattractive” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas.  
  • Marvell Technology (MRVL) agreed to acquire Aquantia (AQ) in a $452 million deal.  Marvell agreed to pay $13.25 per share for Aquantia in cash for all outstanding shares.  Marvell said the deal will immediately be accretive to earnings and will generate run-rate synergies of $40 million annually after 12 months.  The deal is expected to close by the end of 2019.  Aquantia is rated “Neutral” in our US Large-Cap and “Unattractive” in our US Information Technology Global Top Stock Ideas.  
  • New York Times (NYT) reported adjusted earnings that beat consensus.  NY Times first quarter adjusted EPS of 20 cents beat consensus of 9 cents.  Revenue in the quarter was $439 million, in line with $436 million consensus.  NY Times saw 2323,000 net new digital subscribers, with a total of 4.5 million subscribers.  NY Times is rated “Unattractive” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas. 
  • Oracle (ORCL) is alleging that Amazon (AMZN) offered 2 Department of Defense employees jobs while they were working on the $10 billion cloud contract, these allegations are included in its lawsuit.  Oracle says these employees designed the project to be favorable to Amazon’s chances of winning the contract and later were offered a lucrative employment and bonus package.  Oracle has since been eliminated from the competition the winner of which is expected to be announced in July.  Oracle is rated “Attractive” in our US Large-Cap and “Top Buy” in our US Information Technology Global Top Stock Ideas.    Amazon is rated “Neutral” in our US Large-Cap and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.  
  • Softbank (TSE:9984) stands to reap a huge windfall in the wake of Uber’s IPO due this week.  Softbank could see up to a $3 billion gain in just a matter of 16 months, WSJ highlights.  Softbank bought 15% of Uber for $7.7 billion in early 2018 with its Vision Fund when Uber was valued at $48 billion, it is expected to seek a valuation between $80 billion and $90 billion in its IPO.  This would be Softbank’s Vision Fund’s biggest gain yet.  Softbank is rated “Top Buy” in our Japan Large-Cap Global Top Stock Ideas
  • Walt Disney (DIS) updated its film release schedule in the wake of its acquisition of 21st Century Fox entertainment assets.  The biggest change was Disney moving “Avatar 2” to 2021 from 2020; it was to be its biggest film in 2020.  Additional sequels will also be pushed back with “Avatar 5” coming out in 2027.  Disney informed that the next Star Wars episodes, after “The Rise of Skywalker” in December, will hit theaters in December 2022 and December 2024.  Walt Disney is rated “Attractive” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas.  
  • Zayo (ZAYO) is being acquired by the funds Digital Colony and EQT Infrastructure fund.  The funds are paying $35 per share, a 32% premium to Tuesday’s close.  The deal values Zayo at $14.2 billion and will see the company taken private.  Zayo reported fiscal third quarter EPS of 15 cents at the same time, while 17 cents was consensus.  Zayo is rated “Neutral” in our US Large-Cap and “Attractive” in our US Information Technology Global Top Stock Ideas.

Global Industrials Stocks Trending in the News

  • Boise Cascade (BCC) reported first quarter sales that missed consensus.  Boise Cascade first quarter sales of $1.04 billion missed $1.18 billion consensus.  First quarter ebitda of $40.7 million also missed $41.1 million consensus.  Boise said it sees slower demand growth in 2019, saying extreme weather in the first quarter plus capacity additions due to come on line soon will weigh on results.  Boise Cascade is rated “Neutral” in our US SMID-Cap Global Top Stock Ideas
  • Fluor (FLR) was downgraded to neutral from buy at Godman Sachs.  Fluor also saw its price target cut to $28 from $44, the lowest target in the market.  Goldman Sachs cited the “unclear medium-term margin outlook” in its downgrade of Fluor.  Fluor is transitioning to a new CEO and Goldman in not sure the company can maintain its backlog.  Fluor is rated “Top Short” in our US Large-Cap and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas  
  • Marathon Petroleum (MPC) said its MPLX LP is buying Andeavor Logistics in a $9 billion deal.  Marathon Petroleum also said it is not going ahead with the expansion of the Garyville Coker 3 project.  Marathon report a 1 cent per share loss in the first quarter.  Revenue of $28.82 billion trailed $29.5 billion consensus.  First quarter refinery utilization as at 95%, up from 93% a year ago.  Marathon Petroleum is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas
  • Siemens AG (DB: SIE) announced intentions to carve out and list its flagging gas and power division and plans to cut more than 10,000 jobs across the German giant. Siemens aims to spin-off its energy unit into a separately managed entity by September 2020. Siemens will maintain a less than 50% stake in the new entity. Siemens is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.
  • Vale (VALE) reported a steep drop in iron ore production in the first quarter.  Vale saw iron ore production drop to 72.9 million tons from 82 million tons a year ago.  The drop reflects the sharp curtailing of production in the wake of its tailings dam disaster.  Vale removed 93 million ton of annual production to focus on safety, most of which has not fully returned.  Vale is rate “Attractive” in our Brazil All-Cap Global Top Stock Ideas. 

 

 

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Global Financials Stocks Trending in the News

  • AIG (AIG) reports first quarter adjusted earnings that beat consensus strongly.  AIG reported first quarter EPS of $1.58, well ahead of $1.05.  First quarter ROE of 11.6% is a massive improvement over 7.7% a year ago.  AIG posted net investment income of $3.9 billion, up from $3.3 billion a year ago.  Results overall came above expectations and showed a huge improvement from a year ago.  AIG is rated “Top Short” in our US Large-Cap Global Top Stock Ideas
  • Banco Bradesco (BBD), Brazil’s second largest bank, is acquiring Florida-based BAC Florida Bank in a $500 million deal.  The deal will give Bradesco access to 13,000 private banking clients.  Bradesco has never had this size present outside of Brazil.  BAC Florida has $862 million in assets under custody.  Banco Bradesco is rated “Unattractive” in our Brazil All-Cap Global Top Stock Ideas

Global Commodities & Energy Stocks Trending in the News

  • Anadarko Petroleum (APC) said on Monday that the offer from Occidental Petroleum (OXY) is superior to that it received from  Chevron (CVX).  Anadarko said it informed Chevron that the $33 billion deal it agreed to is terminated.  Chevron now has 4 business days to make a counteroffer and if it does not make one, Anadarko will owe Chevron a $1 billion breakup fee.  Occidental said it was pleased Anadarko has accepted its offer.  Occidental removed the need for a shareholder vote and was said to be key to moving forward.  Anadarko Petroleum is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.  Occidental Petroleum is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.  Chevron is rated “Neutral” in our US Large-Cap Global Top Stock Ideas.
  • Mosaic (MOS) shares fell notably lower after the Minnesota-based company said it expects normal demand for US fertilizer during the Spring despite a flooded and wet start to the season. Mosaic also warned investors that its earnings during the second quarter could be adversely impacted by currency fluctuations and Southeast Asian demand. Mosaic will incur up to $100 million in costs during the second quarter as the fertilizer company addresses tailings dam regulatory changes. Mosaic is rated “Top Short” in our US Large-Cap Global Top Stock Ideas.
  • Vale (VALE) suffered another production setback when a court ruled its massive Brucutu mine must stop production.  Brucutu produced 30 million tons of iron ore and was recently reopened only to have a court halt operations again.   Vale said with the disruption, annual production should be at the low end of its 307 to 332 million tons of guidance.  Vale is rated “Attractive” in our Brazil All-Cap Global Top Stock Ideas 

Global Health Care Stocks Trending in the News

  • Allergan (AGN) reported Botox sales above consensus while upping full year EPS guidance.  Allergan reported Botox sales of $868 million, beating $761 million consensus.  First quarter EPS of $3.79 beat $3.55 consensus while revenue of $3.6 billion beat $3.56 billion consensus.  Allergan gave full year 2019 EPS guidance of $16.55 to $16.75, ahead of $16.43 consensus and full year revenue guidance of $15.1 billion to $15.4 billion, a hike from $15 billion to $15.3 billion.  Allergan is rated “Neutral” in our US Large-Cap Global Top Stock Ideas
  • Mylan NV (MYL) shares slid to their lowest levels since 2012 after the generic drug manufacturer disappointed investors looking for an updated turnaround plan for the second quarter in a row. Although Mylan’s board of directors explained that it will create a special committee to examine, “a wide range of alternatives to unlock the true value,” it was not enough to appease anxious investors. Mylan is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • Regeneron Pharmaceuticals (REGN) reported a huge miss with first quarter adjusted earnings.  Regeneron reported first quarter adjusted EPS of $4.45 while consensus was $5.71.  Revenue of $1.71 billion trailed $1.79 billion consensus.  Regeneron’s CEO said the company will continue to invest in a broad immune-oncology portfolio.  Regeneron Pharmaceuticals is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas

 

 

Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS
Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS