>>>US Rumors

Rumor Activity was strong today.

* There were reports that Nelson Peltz has resumed calls to break up Pepsi (PEP). * There were reports that Bayer (BAYRY) and Novartis (NVS) are considering bids for Merck's (MRK) consumer health unit; may be worth $10-12 bln. * There were reports that Nokia (NOK) is considering bid for Juniper (JNPR).   * InvenSense (INVN) strength  attributed to M&A speculation following SWKS comments suggesting MEMS company acquisition interest. * RIT Technologies (RITT) strength attributed to positive blog mention making the rounds. * Citrix Systems (CTXS) strength attributed to analyst suggesting potential shareholder activist action in the near-term.

>>>Four Numbers That Explain Why Facebook

Sequoia Capital Sequoia Capital helps founders turn imaginative ideas into enduring companies. ( Four Numbers That Explain Why Facebook Acquired WhatsApp

WhatsApp Co-Founders Jan Koum and Brian Acton Earlier today, Facebook announced its acquisition of WhatsApp for $16 billion. It’s a spectacular milestone for the company’s co-founders Jan Koum and Brian Acton, and their remarkable team. From the moment they opened the doors of WhatsApp, Jan and Brian wanted a different kind of company. While others sought attention, Jan and Brian shunned the spotlight, refusing even to hang a sign outside the WhatsApp offices in Mountain View. As competitors promoted games and rushed to build platforms, Jan and Brian remained devoted to a clean, lightning fast communications service that works flawlessly. This approach has served WhatsApp well and its users better. WhatsApp has done for messaging what Skype did for voice and video calls. By using the Internet as its communications backbone, WhatsApp has completely transformed personal communications, which was previously dominated by the world’s largest wireless carriers. For the past three years, it’s been our privilege to work shoulder-to-shoulder with Jan and Brian as their close business partner and investor. It’s been a remarkable journey, and we could not be happier for these talented underdogs whose unshakeable beliefs and maverick natures epitomize the spirit of Silicon Valley. Those less familiar with WhatsApp and its wonderful product will marvel at how a young company could be so valuable. Many of those people will be in the U.S. because there’s no other home grown technology company that’s so widely loved overseas and so under appreciated at home. WhatsApp reminds us of other companies that we partnered with — like PayPal, and YouTube — whose founders chose a similar path to Jan and Brian. Today PayPal and YouTube are both household names around the world. Tomorrow the same will hold true for WhatsApp. Here are four numbers that tell the story of WhatsApp: 450, 32, 1 and 0. 450. WhatsApp has more than 450 million active users, and reached that number faster than any other company in history. It was just nine months ago that WhatsApp announced 200 million active users, which was already more than Twitter. Every day, more than a million people install the app and start chatting, and they remain more engaged with WhatsApp than on any other service. Incredibly, the number of daily active users of WhatsApp (compared to those who log in every month) has climbed to 72%. In contrast the industry standard is between 10% and 20%, and only a handful of companies top 50%. WhatsApp has tapped into our insatiable appetite for personal communication. It is part of a chain that over the past 150 years reaches from the Pony Express, Telegraph and airmail letter to the telephone and email. WhatsApp has become today’s flag-bearer for personal communications. Jan and Brian’s product caters to those you care about most: the people in the address book on your phone. WhatsApp is simple, secure, and fast. It does not ask you to spend time building up a new graph of your relationships; instead, it taps the one that’s already there. Jan and Brian’s decisions are fueled by a desire to let people communicate with no interference. 32. Even by the standards of the world’s best technology companies, WhatsApp runs lean. With only 32 engineers, one WhatsApp developer supports 14 million active users, a ratio unheard of in the industry. (WhatsApp’s support team is even smaller.) This L E G E N D A R Y crew has built a reliable, low-latency service that processes 50 billion messages every day across seven platforms using Erlang, an unusual but particularly well-suited choice. All that, while maintaining greater than 99.9% uptime, so users can rely on WhatsApp the way they depend on a dial-tone.

The note on Jan’s desk 1. Jan keeps a note from Brian taped to his desk that reads “No Ads! No Games! No Gimmicks!” It serves as a daily reminder of their commitment to stay focused on building a pure messaging experience. This discipline is reflected in WhatsApp’s unconventional approach to business. After one year of free use, the service costs $1 per year — with no SMS charges. This can save users trapped in expensive data plans up to $150 per year. It’s easy to take this novel model for granted. When we first partnered with WhatsApp in January 2011, it had more than a dozen direct competitors, and all were supported by advertising. (In Botswana alone there were 16 social messaging apps). Jan and Brian ignored conventional wisdom. Rather than target users with ads — an approach they had grown to dislike during their time at Yahoo — they chose the opposite tack and charged a dollar for a product that is based on knowing as little about you as possible. WhatsApp does not collect personal information like your name, gender, address, or age. Registration is authenticated using a phone number, a significant innovation that eliminates the frustration of remembering a username and password. Once delivered, messages are deleted from WhatsApp’s servers. It’s a decidedly contrarian approach shaped by Jan’s experience growing up in a communist country with a secret police. Jan’s childhood made him appreciate communication that was not bugged or taped. When he arrived in the U.S. as a 16-year-old immigrant living on food stamps, he had the extra incentive of wanting to stay in touch with his family in Russia and the Ukraine. All of this was top of mind for Jan when, after years of working together with his mentor Brian at Yahoo, he began to build WhatsApp. Facebook has assured Jan and Brian that WhatsApp will remain ad free and they will not have to compromise on their principles. We know that Jan, as a new member of Facebook’s board, will continue to champion the rights of WhatsApp users. 0. There may be no greater testament to the viral nature of WhatsApp than the fact that the company has accomplished all this without investing a penny in marketing. Unlike their smaller competitors, it hasn’t spent anything on user acquisition. The company doesn’t even employ a marketer or PR person. Yet like the world’s greatest brands, it’s created a strong emotional connection with consumers. All of WhatsApp’s growth has come from happy customers encouraging their friends to try the service. *** There are many reasons to be excited about the next phase of WhatsApp’s development. Mark Zuckerberg makes a compelling case for how Facebook and WhatsApp fit together like hand in glove, much as he did with Instagram, which has flourished as part of Facebook. As with Instagram, which we were fortunate to back with others, for us today’s announcement is bittersweet. Our excitement about the opportunities that lie ahead for WhatsApp and Facebook is tinged with a little sadness, and a lot of nostalgia, for the pleasure and satisfaction that all of us at Sequoia have felt working with the company over the past three years. From the time WhatsApp had fewer than ten users, Jan and Brian have been committed to building an enduring service. Now, on their way to a billion, they are just getting started. — Jim Goetz, on behalf of Sequoia whatsapp facebook Feb 19th, 2014 461 notes

robcol125 likes this dosht likes this theeconomicsofbeingborn reblogged this from sequoiacapital glimpsesofgreatness likes this dotnotfeathers likes this my-other-life00 likes this kimlud1 likes this partingtheveils reblogged this from sequoiacapital theonehunted likes this lukaszgrzesiak reblogged this from sequoiacapital aakashbarot reblogged this from sequoiacapital sebvanker reblogged this from sequoiacapital sirrah-alpheratz likes this freechancer likes this nuwagaba likes this rezaaba reblogged this from sequoiacapital and added: A very interesting read indeed on the acquisition of WhatsApp by Facebook from the private equity investors in the... dustyprogrammer likes this scorintha reblogged this from sequoiacapital jilldgriffin reblogged this from sequoiacapital doncatalog reblogged this from sequoiacapital mumukamu reblogged this from sequoiacapital mananshah212 likes this cthrin likes this mrmatt reblogged this from sequoiacapital thegongshow likes this jfly44 reblogged this from sequoiacapital aaaryanavar reblogged this from sequoiacapital alalchan reblogged this from sequoiacapital whitengray likes this karissananetta reblogged this from sequoiacapital and added: After reading this, maybe the $16B is justified. Whatsapp does have a compelling business model. jonoit reblogged this from sequoiacapital jonoit likes this mounibec likes this mounibec reblogged this from sequoiacapital galladeri reblogged this from sequoiacapital lagunas488 reblogged this from sequoiacapital blueberrymilkshake likes this narcink reblogged this from sequoiacapital designroomvcworld likes this btwak likes this tannerpowell likes this yousuftareen likes this kpvl likes this lancekey reblogged this from sequoiacapital and added: 450, 32, 1 and 0. Out of these, is the “biggest” one. Build something great, and you can enjoy that nice, round too. namitc likes this srini10000 reblogged this from sequoiacapital gbattle likes this bossmod3 likes this apaunchev likes this blizfulnsanity likes this Show more notes

>>> US Gapping down

Gapping down

In reaction to disappointing earnings/guidance: CONN -28.3%, HAWK -14.5% (also downgraded to Underperform from Neutral at Macquarie), MM -11.1%, GDP -7%, ACHC -5.2%, (ticking lower), AEG -5.2%, PVA -4.3%, (announces year-end 2013 proved reserves and provides operational update; FY13 proved oil and gas reserves increased by 22.9 MMBOE, or 20%, to 136.3 MMBOE from 113.5 MMBOE), DENN -3.6% (light volume), YNDX -3.5%, RBCN -3.1%, DNR -2.7%, CROX -1.7%, WMT -1.7% (also raises dividend and expanding small store format), PAAS -1.6%, RGP -1.6% (light volume), ALLE -1.2%, (light volume), WMB -1.2%, SNPS -0.4% (also announces acquisition of Coverity, a provider of software quality, testing, and security tools, for $375 mln, or $350 mln net of cash).

M&A news: FB -1.9% (to acquire WhatsApp, a mobile messenger, for $16 bln).

Select solar names showing early weakness: YGE -3.8%, TSL -1.6%, JKS -1.5%, RSOL -1%, .

Other news: ONTX -35.1% (announces results from Phase 3 ONTIME Trial of Rigosertib in higher risk myelodysplastic syndromes did not meet primary endpoint; downgraded at Janney and Piper), USU -14.3% (still checking), CYTK -8.1% (announces proposed public offering of common stock; size not disclosed), KYN -5.2% (announces public offering of 6.75 mln shares of its common stock), NCQ -3.7% (intends to raise a total of ~ $20 mln through the combination of a public offering and a private placement with its large shareholders), PLUG -3.1% (still checking), ALU -2.8% (still checking; may be attributed to NOK / JNPR speculation), MUX -2.4% (McEwen Mining El Gallo 1 Mine Expansion Nears Completion), HGG -2.1% (following CONN results), TRP -1.8% (WSJ discusses that Nebraska Judge has blocked his Keystone decision), BERY -1.4% ( announces secondary public offering of 9 mln shares of common stock by funds affiliated with Apollo Global Management).

Analyst comments: PPO -1.4% (downgraded to Mkt Perform from Outperform at William Blair ), ABB -1.2% (downgraded to Sell from Neutral at Goldman), AAPL -0.8% (Apple downgraded to Equal-Weight from Overweight at Barclays)

>>> US Gapping up

Gapping up

In reaction to strong earnings/guidance: TSLA +12.1%, IMAX +9.8%, DL +9.4% (light volume), AWAY +9.4%, PRAA +8.5% (also agrees to acquire Aktiv Kapital for $880 mln, while also agreeing to assume ~$435 mln of its corporate debt, resulting in an acquisition of estimated total enterprise value of $1.3 bln; expected to be immediately accretive to earnings), AVG +7.5%, TRN+4.5%, MONT +4%, ASGN +3.9%, JACK +3.6%, VECO +3.5%, SWY +3.4%, (also following late spike on PE speculation; confirmed discussions concerning a possible transaction involving the sale of co; plans to distribute Blackhawk shares to stockholders; also exploring monetization of its ownership in Casa Ley), WLT +3.1%, EIG +2.9%, ( downgraded to Mkt Underperform from Mkt Perform at JMP Securities), ARRS +2.4%, (light volume), AMTG +2.2%, (light volume), UPL +2%, HRL +2%, (ticking higher), CSGP +1.8%, MCHX +1.8%, (light volume), TRAK +1.6% (also upgraded to Outperform from Market Perform at Wells Fargo), WLK +1.6%, (light volume), EQIX +1.2%, (also downgraded to Neutral from Overweight at Piper Jaffray), ACT +1.2%.

M&A news: JNPR +2.9% (Nokia considering acquisition of JNPR, according to reports ).

Select oil/gas related names showing strength: SNP +2.9%, DO +1.6%, COP +1.0%, BP +1%, RDS.A +0.6%, SDRL +0.6%, PBR +0.6%, CVX +0.4%.

A few biotech/pharma names are higher: MRK +1.1%, AZN +1%, BMY +1.0%, GSK +1.0%

FB/WhatsApp news lifting select tech names/peers: MEET +13.1% BBRY +4.9% TWTR +0.5%

Other news: RPTP +7.2% (Announces Clinical Results With RP103 in Huntington's Disease Phase 2/3 Trial; 18 Month Clinical Results Showed Significantly Slower Progression of Total Motor Score in RP103 Treated Patients Without Tetrabenazine), ATRS +5.5% (announces positive results from the VIBEX QuickShot pharmacokinetic study in testosterone deficient men; rapid restoration and consistent maintenance of steady testosterone blood levels achieved with once-weekly subcutaneous administration using the QuickShot auto injector), KNDI +4.1% (TSLA sympathy), VE +3.3% (Veolia Environnement higher on contract win news), GRPN +2.8% (ahead of earnings after the close), SCTY +2.6% (TSLA/Musk sympathy), OMG +1.7% (OM Group company EaglePicher Technologies receives contract from Erigo Technologies to deliver a Flexible Microgrid Energy Storage System for DoD applications), SVU +1.3% (following SWY results and news), WRB +0.6% (increases share repurchase authorization back to its previous level of 10 mln shares of common stock), ALL +0.6% (increases quarterly dividend 12% to $0.28 from $0.24 per share; launches $2.5 bln common stock repurchase program), PCLN +0.5% and CTRP +0.5% (following AWAY results), NXPI +0.4% (repurchases 5 mln shs of common stock ), KR +0.3% (following SWY results and news).

Analyst comments: BLOX +3.2% (upgraded to Buy from Neutral at Goldman), BCRX +2.8% (initiated with a Buy at Mizuho; tgt $23 ), HSTM +1.4% (upgraded to Overweight from Equal Weight at First Analysis), G +1.3% (initiated with an Overweight at Piper Jaffray), ABX +1.2% (upgraded to Outperform from Sector Perform at RBC Capital), CAT +0.3% (initiated with a Buy at Deutsche Bank)

>>> Wal-Mart beats by $0.01, reports revs in-line; U.S. Q4 comparable store sale

Wal-Mart beats by $0.01, reports revs in-line; U.S. Q4 comparable store sales of -0.4%; guides Q1/FY15 EPS below consensus; sees FY15 revs at low end prior range (74.85)
Reports Q4 (Jan) earnings of $1.60 per share, $0.01 better than the Capital IQ Consensus 
Estimate of $1.59; revenues rose 1.5% year/year to $129.71 bln vs the $129.52 bln consensus

  • WMT reports U.S. Q4 comparable store sales of -0.4% vs guidance for slightly negative WMT reports Sam's Club Q4 comparable store sales of -0.1%; guided for slightly negative to 0-2% (excluding fuel). During the 14-week period, Walmart U.S. comp traffic decreased 1.7 percent, while average ticket increased 1.3 percent. E-commerce sales positively impacted comp sales by approximately 0.3 percent for the 14-week period. In the fourth quarter period, excluding fuel,1 Sam's Club comp traffic was up 1.2 percent, while ticket was down 1.3 percent. E-commerce sales positively impacted comp sales by approximately 0.4 percent for the 14-week period.
  • Co issues downside guidance for Q1, sees EPS of 1.10-1.20 vs. $1.23 Capital IQ Consensus Estimate. WMT sees U.S. Q1 comparable store sales relatively flat and Sam's Club comparable store sales relatively flat. Co issues downside guidance for FY15, sees EPS of 5.10-5.45 vs. $5.55 Capital IQ Consensus Estimate; sees FY15 revs of low end 3-5% (~$487.2 bln) vs. $491.13 bln Capital IQ Consensus Estimate.
  • "We expect economic factors to continue to weigh on our outlook... Some of the factors affecting our consumers include reductions in government benefits, higher taxes and tighter credit. Further, we have higher group health care costs in the U.S. These concerns, combined with investments in e-commerce, will make it difficult to achieve the goal we have of growing operating income at the same or faster rate than sales. In October, we forecasted a 3 to 5 percent net sales increase for fiscal 2015. Given these factors and the ongoing headwind from currency exchange, we expect to be toward the low end of the net sales guidance. "Additionally, all guidance provided today assumes currency exchange rates remain at current levels," added Holley. "If currency rates remain where they are today, net sales would be negatively impacted by approximately $3.5 billion for fiscal 2015. During the first quarter of this year, we will begin to anniversary the increased costs we incurred last year for FCPA matters, including compliance program enhancements and the ongoing investigations. We anticipate expenses for FCPA matters and compliance-related enhancements to range between $200 and $240 million for fiscal 2015." The company's pending sale of the Vips restaurant business in Mexico remains subject to regulatory approval and is now expected to be completed in the first quarter of fiscal 2015. The Vips results are recorded in discontinued operations, and the estimated future gain from the sale is expected to be approximately $0.06 per share.

>>> US Early premarket gappers

Early premarket gappers

Gapping up: TSLA +9.9%, DL +9.4%, PRAA +8.3%, AWAY +7.5%, AVG +7.5%, BBRY +6.5%, TRN +4.5%, KNDI +4.1%, ASGN +3.9%, JACK +3.6%, VECO +3.5%, SWY +3.4%, VE +3.3%, EIG +2.9%, SCTY +2.7%, ARRS +2.4%, AMTG +2.2%, CSGP +1.8%, MCHX +1.8%, OMG +1.7%, SVU +1.3%, EQIX +1.2%, BP +1%, NOK +0.7%, WRB +0.6%, ALL +0.6%

Gapping down: ONTX -35.1%, HAWK -13.3%, MM -11.1%, CYTK -8.1%, KYN -5.2%, ACHC -5.2%, GDP -5.2%, AEG -5.2%, OIBR -5.1%, PVA -4.3%, NCQ -3.7%, DENN -3.6%, RBCN -3.1%, GFI -2.8%, FB -1.9%, TRP -1.8%, RGP -1.6%, ALLE -1.2%, WMB -1.2%, RIO -1%

>>> Newmont Mining declares quarterly dividend of $0.15 per share vs $0.20 in pr

Newmont Mining declares quarterly dividend of $0.15 per share vs $0.20 in prior quarter; updates gold price-lined dividend policy to preserve financial flexibility 

Co announced its Board of Directors declared a quarterly dividend of $0.15 per share of common stock, payable on March 27, 2014, to holders of record at the close of business on March 13, 2014. The first quarter 2014 dividend is based on Newmont's gold price-linked policy and based on the average London P.M. Fix of $1,276 per ounce for the fourth quarter 2013.

Moving forward, Newmont continues to remain bullish on the long-term outlook for gold and will retain the dividend policy's link to the gold price. However, the Company will be adjusting the annual payout levels to provide financial flexibility in the current gold price environment while still offering investors continued leverage as prices rise.
Newmont's updated gold price-linked dividend policy includes a quarterly payable dividend based on the average London P.M. Fix for the preceding quarter. The first payout level will begin between $1,200 and $1,299 per ounce, with an annual dividend of $0.10 per share or $0.025 per quarter. The second payout will be between $1,300 and $1,399 per ounce, with an annual dividend of $0.20 per share or $0.05 per quarter. For each $100 per ounce additional increase in the average realized gold price above $1,300 per ounce, the annual payout will increase at a rate of $0.20 per share or $0.05 per quarter. For example, if the average London P.M. Fix for the preceding quarter was $1,400 per ounce, the annual dividend would be $0.40 per share or $0.10 per quarter.

>>> Tesla Motors beats by $0.12; guides FY14 deliveries above consensus

--> TSLA +12.6% in After hours - (1,390,181 shares traded @ 217.7906)...

Tesla Motors beats by $0.12; guides FY14 deliveries above consensus

Reports Q4 (Dec) earnings of $0.33 per share, excluding non-recurring items, $0.12 better than the Capital IQ Consensus Estimate of $0.21; non-GAAP rev (including deferred rev from lease accounting) rose 148.5% year/year to $761.3 mln vs the $673.14 mln consensus -- GAAP rev was $615 mln; Q4 deliveries 6892 -- co raised guidance to almost 6900 from slightly under 6000 on January 14.

Guidance:

"We expect to deliver over 35,000 Model S vehicles in 2014" vs. expectations of ~29K, representing a 55+% increase over 2013. Production is expected to increase from 600 cars/week presently to about 1,000 cars/week by end of the year as we expand our factory capacity and address supplier bottlenecks. Battery cell supply will continue to constrain our production in the first half of the year, but will improve significantly in the second half of 2014.

First quarter production is expected to be about 7,400 vehicles, which is significantly higher than the prior quarter production of 6,587 cars. However, as the number of cars in transit to Europe and Asia must grow substantially to support those markets, we plan to deliver ~6,400 vehicles in Q1. Deliveries will grow dramatically in future quarters as the logistics pipeline fills.

This year, we expect automotive gross margin to increase to about 28% (non-GAAP and GAAP) in Q4 through a series of small design improvements, better supplier prices and economies of scale. Q1 gross margin should increase very slightly from Q4. For the remainder of the year, gross margin should improve at a faster pace. Operating expenses and capital expenditures will increase significantly in 2014, as we plan to invest in the long term growth of Tesla. We plan to expand production capacity for Model S and Model X, invest in our store, service and Supercharger infrastructure, complete the development of Model X and start early design work on our third generation car. In Q1, operating expenses are expected to grow roughly 15%. R&D expenses will increase as design and engineering work accelerates on Model X.

We expect to have production design Model X prototypes on the road by end of year and begin volume deliveries to customers in the spring of 2015.

Conf Call Details :
- Seeing strong demand for Model X, despite no advertising; seems likely co will be unable to supply demand in China this year
Management said licensing for selling in China is not a problem, it is more local manufacturing. The company does not expect to need a local partner in China.
- Elon Musk provides color on media coverage of fires - initially saw a 'significant' drop in demand, but sales recovered after facts came out
Musk said sales have steadily improved since customers have realized that it was more of a media driven story and that Tesla cars are safe.
- Elon Musk says he thinks Model X demand will exceed Model S demand
Musk also said it seems likely that the company would continue to see demand of 1000 units per week for the Model S.
-Co is working on solutions for charging in China (193.64 -10.06)
A call participant asked how the company planned to address the issue of charging in China where owners are potentially more likely to live in apartment buildings as opposed to houses. Musk would not elaborate on the issue but said that the company plans to talk more about it in the coming months