>>> US Gapping down

Gapping down

In reaction to disappointing earnings/guidance: VOXX -21.5% (also downgraded to Neutral from Buy at B. Riley & Co), RGSE -14.7%, XONE -13.4%, NTES -7.8%, WX -6.3%, PT -6.1%, SEAS -3.5%, KSS -3.4%, WMT -3.2%, DANG -2.9%, JACK -2.8%, A -1.5%, USU -1.1%, (USEC Inc. reports large Q1 net loss -- Chapter 11 process continues; co anticipates emerging this summer).

M&A news: BSX -0.4% (announces definitive agreement to acquire interventional division of Bayer AG for $415 mln in cash), AAPL -0.2% (acquisition of Beats has been moved back by 7 days, according to reports).

Other news: LIQD -30.4% (thinly traded, still checking on catalyst), SRNE -17.9% (prices 4,765,000 shares of common stock at a public offering price of $5.25 per share), NBG -13.3% (still checking), INCY -8.8% ( following release of ASCO abstracts; Presents data from two trials involving ruxolitinib), AMRN -7.9% (announces private exchange transactions regarding outstanding Senior Exchangeable Notes), SIR -5.2% (announces proposed public offering of 8 mln common shares ), DCIX -5.1% (still checking), SIR -4.9% (prices 9 mln shares of common stock at $29.00 per share), DK -1.9% (prices 9.2 mln shares of its common stock offered by Delek Hungary y (the Selling Stockholder) at $30.00 per share), ALU -1.5% (still checking), DDD -0.9% and SSYS -0.5% (following XONE results), PCYC -0.6% ( highlights new data for IMBRUVICA (ibrutinib) in B-cell malignancies).

Analyst comments: MTGE -1.6% (downgraded to Mkt Perform from Mkt Outperform at JMP Securities), VOD -1.3% ( downgraded to Neutral from Buy at Goldman ), ITC -1.1% (ITC Holdings downgraded to Neutral from Overweight at JPMorgan), BMY -0.2% (downgraded to Mkt Perform from Outperform at BMO Capital Mkts ), O -0.1% ( downgraded to Neutral from Buy at Ladenburg Thalmann)

>>> US Gapping up

Gapping up

In reaction to strong earnings/guidance: TNK +9.9% (ticking higher), VIPS +8%, CSCO +7.2%, TSEM +6.7%, SANW +6.6%, (light volume), OPWR +4.1%, (light volume), AGYS +3.4%, (light volume), CA +3.1%, AEG +1.4% (light volume), GOL +0.5% .

M&A news: GTIV +52.2% (Gentiva Health Svcs receives proposal to be acquired by Kindred Healthcare for a combination of $7.00 per share in cash and $7.00 of Kindred common stock ), DTV +0.5% (AT&T has hired Lazard to advise on DTV buyout, according to reports).

Tech/CSCO peers trading higher: SYMC +2.8% (ValueAct disclosed stake; also following CSCO results), JNPR +1.6%, FFIV +1.5%, CIEN +1.1%, VMW +0.8%, FTNT +0.8%,

Select financial related names showing strength: HSBC +1.9%, BCS +1.4%, IBN +0.8%.

A few miners are trading higher: BBL +1.3%, RIO +1.1%, BHP +0.3%.

Biotech/drug names higher: CLVS +8.2% (confirmed clinical data to be presented at 2014 ASCO Annual Meeting; also mentioned by Adam Feuerstein -- highlights lung cancer related names ), MNTA +4.7% (on TEVA Copaxone news), ISIS +4.5% (ISIS Pharm earns a $3.0 mln milestone payment from GlaxoSmithKline (GSK) related to the initiation of a natural history study), XNPT +3.7% (Xenoport and Reckitt Benckiser Pharmaceuticals Enter Into Global Licensing Agreement for Arbaclofen Placarbil), CLDX +1.7% (announces Varlilumab (CDX-1127) Phase 1 clinical data to be presented at ASCO Annual Meeting 2014), MYL +1.6% (comments on ruling against Teva in their suit against the FDA, which denied Teva's motion to block FDA from approving generic versions of Copaxone and dismissed the case for lack of jurisdiction).

Select China internet names getting boost following VIPS results: WUBA +1%, YY +0.7%, QIHU +0.7%, SINA +0.5%, VNET +0.3%

Other news: NWBO +17.8% (announces first data from ongoing DCVAX-Direct trial; evidence indicates substantial tumor necrosis and initial tumor regression), DRL +10.9% (calls on the Puerto Rico government to honor its obligations), AMED +3.6% (following GTIV news), DQ +2.8% (modestly rebounding), WILN +2.2% (concludes strategic review, formulates growth plan; to increase dividend 25%), DNDN +1.9% (announces presentation of PROVENGE and DN24-02 immuno-oncology data at the 2014 ASCO annual meeting), RATE +1.6% (following CEO insider buy), JDSU +1.5% (following A results), DQ +1.4% (prices 2 mln ADSs at $29.00 per share ), WWE +1.3% (following late move higher on tv contract speculation), UL +0.9% (still checking), HFC +0.8% (announces increase in regular dividend by 6.6% to $0.32 per share and declares additional $0.50 special dividend), BDBD +0.8% (positive MadMoney mention), MUR +0.3% ( announces additional $125 mln share repurchase program; also may sell Malaysia oil and gas assets for $ 2 bln, according to reports ), EXPD +0.2% (ValueAct discloses updated portfolio positions in 13F filing).

Analyst comments: NMBL +7.8% (upgraded to Buy from Neutral at Goldman; tgt lowered to $34 from $46), PLUG +6% (upgraded to Outperform from Mkt Perform at Cowen; tgt lowered to $6 from $7.50), MILL +2.3% (assumed with a Buy (from hold) at Brean Capital), KMI +1.9% (added to Conviction Buy list at Goldman), TWTR +1.1% ( upgraded to Neutral from Underweight at Atlantic Equities), SRC +1% (upgraded to Buy from Neutral at Ladenburg Thalmann)

>>> Tubos Reunidos looks for acquisitions and JVs as part of its growth strategy

Tubos Reunidos looks for acquisitions and JVs as part of its growth strategy, source says


Tubos Reunidos [MCE: TRG], the Spanish, listed seamless steel tubes maker, is looking for acquisitions and joint ventures as part of its 2014-2017 business plan, a company source said.

Any deals or JVs would have to help the company execute its new business plan, the source said. The main points of the plan are specializing in premium products, developing new products, increasing its regional presence and growing its services division, Almesa.

The company will study the acquisition of companies that complete its range of products, strengthen Almesa or help it enter target markets such as the US, the source said. In the US, Tubos Reunidos would be particularly interested in buying a company that specialises in finishing tubular products or a company that can offer value-added services to its clients, the source said.

Tubos Reunidos is also interesting in increasing its presence in Latin America, North Africa and the Middle East, the source said. The company could study buying a target or entering a JV with a local player, the source added.

The company has an in-house team to analyse markets and suggestions from advisors, the source said, adding that it would like to hear from advisors with more proposals.

Tubos Reunidos could also study commercial agreements with other tubular products makers, the source said.

Meanwhile, the company is not planning a rights issue, the source said. In case a big deal arises, it could finance it in the markets (with bonds or a bullet loan) or with a rights issue, the source added.

Although the company is not looking for a merger, possible opportunities must be analysed, the source said.

Tubos Reunidos hit EUR 42m in EBITDA and EUR 350m in revenues last year.

A spokesperson for the company declined to comment.

by Iñaki Miguel in Madrid


Source Proprietary Intelligence

>>> Gazprom OAO Reportedly Gazprom and China National Petroleum Corporation (CNP


Gazprom OAO Reportedly Gazprom and China National Petroleum Corporation (CNPC) will sign a 30-year natural gas delivery contract when Russia President Putin visits China next week - press
- The 30-year delivery contract between Gazprom and CNPC for 38 billion cubic meters of natural gas per year, with the potential to expand the annual capacity to 61 billion cubic meters 
- Construction of the pipeline between China and Russia will likely begin by the end of the year, and with operations beginning in 2018.

(BFW) EDF CEO Says Alstom Sale Would Have Consequences for Utility...

 BN 05/15 11:48 *EDF CEO SPEAKS ON ALSTOM FOLLOWING PARIS SHAREHOLDERS' MEETING
 BN 05/15 11:48 *EDF WANTS TO SAFEGUARD ITS OWN INTERESTS ON ALSTOM, CEO SAYS
 BN 05/15 11:47 *EDF CEO SAYS ALSTOM SALE WOULD HAVE CONSEQUENCES FOR UTILITY
EDF CEO Says Alstom Sale Would Have Consequences for Utility
2014-05-15 11:55:46.495 GMT


By Tara Patel
     May 15 (Bloomberg) -- The potential sale of Alstom SA’s
energy assets would have consequences for Electricite de France
SA, the world’s biggest nuclear operator, CEO Henri Proglio told
reporters today following a shareholders’ meeting in Paris.
     “We will find a way to safeguard our own interests,” he
said, noting that Alstom is a “big supplier and long-term
partner” for EDF.
     Asked whether EDF could play a bigger role in the tussle
for Alstom, Proglio said it would be “derisory and not
relevant.”
  * NOTE: Alstom supplies equipment such as steam generators for
    EDF nuclear reactors

Link to Company News:{ALO FP <Equity> CN <GO>}
Link to Company News:{EDF FP <Equity> CN <GO>}
Link to Company News:{GE US <Equity> CN <GO>}
Link to Company News:{SIE GR <Equity> CN <GO>}

For Related News and Information:
First Word scrolling panel: {FIRST<GO>}
First Word newswire: {NH BFW<GO>}

To contact the editor responsible for this story:
Tara Patel at +33-1-5365-5058 or
tpatel2@bloomberg.net

(Makor) Special Situations - Sky Deutschland: BUY


SpecialSituation-RARe©Trading                          Sky Deutschland (SKYD GR)

BUY

SKYD GR: Eur 6.62; target: Eur 6.90

May 12, 2014

On May 12, BSkyB acknowledged that it is in preliminary discussions with 21st Century Fox to evaluate the potential acquisition of its pay-tv assets in Germany (Sky Deutschland – SKYD) and Italy (unlisted). Fox owns ~57% of SKYD, 39% of BSkyB, and 100% of Sky Italia. BSkyB also noted that under German legislation, it would be required to launch a buyout offer for the SKYD’s minorities and it would expect, subject to German minimum offer price rules, to make this offer without a premium. Under the German minimum price rules, a bid price would be the higher of the last three-month VWAP or the highest price paid by a bidder in the preceding six months to acquire target shares. On this basis, we believe that the floor for a potential SKYD bid has been set around ~€6.7 (last three month VWAP).

Unlike other cable operators in Europe, SKYD is a growth stock, whose revenue and EBITDA are forecast to grow well into 2020s on the back of improving pay-tv penetration (currently below 10%) in the German market. Presently, consensus forecasts a three-year revenue CAGR of 14% and a three-year EBITDA CAGR of ~129%. On a relative basis (PE vs revenue growth), SKYD looks undervalued and we would value it around €7.90 a share. On a DCF basis, we value SKYD at €7.50 a share. Recent precedent transactions in the European cable sector are not comparable given SKYD’s growth profile. However, we note that on EV/Sub basis, SKYD (~€1800/sub) is valued at the high end of the precedent multiple range. If we apply, the EV/Sub paid for Virgin Media by Liberty (highest in our list), we would value SKYD at around ~€8.0 a share.

Overall, we are skeptical that BSkyB will pay a control premium to SKYD minorities, at least immediately. However, should BSkyB decides to consolidate the SKY’s European operations, SKYD minorities could benefit from backend transactions (e.g. domination agreement / outright bid etc.) that are likely to be pitched at higher premiums. We estimate a risk adjusted “efficient” price of ~€6.90 assuming (i) a bid at a price of €7.90 (30% probability), (ii) bid at 3m VWAP of ~€6.7 (40% probability), and (iii) no deal and SKYD trades around ~€6.3 (30% probability).  On this basis, we would buy SKYD.

FULL REPORT ATTACHED

WSJ : IBM's Earnings Target Doesn't Compute

IBM's Earnings Target Doesn't Compute

For IBM, talk isn't exactly cheap.

That much was clear in the reaction to Big Blue's analyst meeting on Wednesday, at which it maintained its target of delivering $20 in operating earnings per share in 2015. Despite that promise, shares of International Business Machines IBM -1.81% slipped, adding to a steady decline since the company reported disappointing first-quarter results last month.

Even more notable is how the stock has lost nearly 6% against a 30% increase in the Nasdaq Composite since IBM's last analyst day in February 2013. The $20-per-share target was promised there as well, but investors have grown more skeptical since.

IBM had a reputation as a reliable generator of earnings-per-share growth despite challenges to expand its enormous revenue base. But that is looking tarnished these days. Earnings fell more than 15% in the first quarter from the year-ago period, with IBM reporting its eighth consecutive quarterly revenue decline year over year.

Today's tech investors are all about revenue growth, and IBM chief Virginia Rometty went on the offensive Wednesday, promising growth "in the right places," which includes hot areas such as big data and the cloud.

But that stopped short of promising revenue growth for the company as a whole, which is a bigger ask for a business of IBM's size. The company said it has made 43 acquisitions since the beginning of 2010, but revenue has expanded by just a little over 4% in that time. To deliver 10% annual revenue growth now would require IBM to find about $10 billion in new sales in a market where its big rivals are hunting for precisely the same thing.

The challenge of doing that explains why IBM maintains its focus on delivering higher earnings growth. But the target of $20 a share for 2015 implies growth of almost 23% over a two-year period, which looks ambitious. And IBM admitted Wednesday that it faces a "tax headwind" of about $1.50 a share against that goal. Moreover, based on the company's current forecast, share buybacks will account for less than half of the expected growth.

So reaching next year's earnings goal is no sure thing. The revenue picture remains unclear and the company must deliver on promises to arrest the losses in its hardware business. At about 10 times forward earnings, the stock's valuation isn't terribly demanding. But given the uncertainty around IBM's growth potential, and the risk that it misses its earnings goal, investors shouldn't see that as a compelling reason to buy.