Barrons : Femsa Is More Than a Mexican Coca-Cola Bottler. Why It’s Time to Buy t

Femsa Is More Than a Mexican Coca-Cola Bottler. Why It’s Time to Buy the Stock.
With a growing convenience-store business, the company’s shares are looking attractive.

Coca-Cola is big business, and in Mexico, it’s big business for Fomento Económico Mexicano. Shares of Femsa, as it is known, look ready to pop.

Femsa is a holding company with a near-majority stake in Coca-Cola Femsa, the largest franchise bottler of Coke products in the world by volume, and a growing convenience-store business. The American depositary receipts, which trade under the symbol FMX, have slumped more than 9% this year to a recent $117.60 after Femsa announced the departure of its respected chief financial officer and chief corporate officer in February, events that followed the naming of an acting CEO last July. The Mexican presidential election, which resulted in victory for Claudia Sheinbaum and a sweep of Congress by her left-wing Morena party, pushed the shares another leg lower.

That all seems like an overreaction. Femsa’s bottling business is a solid, steady grower, while the company has been selling nonessential businesses, which will allow it to continue to return cash to shareholders in the form of buybacks and dividends. But the real story is its convenience-store business, which is set to expand in South America and Central America, and perhaps even in Texas. With the stock down from its peak, now looks like a good time to buy in.

“Despite share price volatility around executive departures and elections in Mexico, the long-term growth story remains intact,” says Derrick Irwin, portfolio manager for the Intrinsic Emerging Markets Equity team at Allspring Global Investments. “Shares are trading at a significant discount to our valuation assessment, while the growth opportunity for Oxxo convenience stores…remains excellent.”

Femsa might be best known for the Coca-Cola bottling business. It accounts for just about a third of Femsa’s sales, and while Mexico is its primary market, it has operations throughout Latin America, with products ranging from classic Coke to sugarless beverages and energy drinks. It’s also very profitable: Femsa’s bottling division sports industry-leading earnings before interest, taxes, depreciation, and amortization margins of about 19%.

But the real growth comes from Femsa’s convenience-store business, which operates under the name Oxxo. Every day, one in 10 Mexicans visits one of the more than 23,000 Oxxo locations in that country, and it’s expanding that C-store chain across Latin America, with an eye to ultimately coming to the U.S., as well. Femsa plans to open about 1,000 new stores in Mexico in 2024 alone, a year that has seen its 500 th store open in both Brazil and Colombia. For the U.S., Femsa may set up in Texas and other Southern markets. Given the extremely fragmented state of the industry in the U.S., the economics of convenience stores favor larger, well-funded operators like Femsa that can take market share from smaller rivals.

“Femsa has the best C-store business in the world,” says Richard Cook, co-founder and portfolio manager at Cook & Bynum Capital Management. “The growth potential is massive if the company can replicate its Mexican success in these other countries.”

Femsa’s Oxxo stores have margins of 10%, which Cook says are the highest of any convenience-store operator globally. Moreover, while investors may be worried about an uneven economic outlook for the region, that would not necessarily be as big a headwind for Femsa as for other companies, given that Oxxo has a growing financial-technology component.

“Their outlets are the origination point for an increasing number of cash-to-digital financial transactions, including paying utility bills, topping up mobile phone cards, buying Fortnite V-bucks, and paying for Amazon
AMZN

-0.34%
online purchases,” Cook explains. In May, Oxxo and Amazon.com announced an expanded partnership allowing customers to receive packages at Oxxo stores across Mexico.

Femsa will get a chance to show that the story is on track when it reports earnings on July 24. The consensus among analysts calls for earnings per share to be roughly flat this year at $5.41, but jump some 12% in 2025 to $6.05. Revenue is expected to grow in the high-single digits in both years, reaching $51.7 billion by 2026.


All of that cash will help fund Femsa’s continued stock buybacks. Last month, it completed its accelerated $400 million share repurchase plan, replacing it with a new $600 million mandate. It can amply afford to be generous given its divestitures—it’s expected to sell logistics and refrigeration assets this year—and the roughly $2 billion in cash it generates every year. The company has virtually no net debt at the corporate level.

Jefferies analyst Pedro Baptista reiterated a Buy rating on the shares on July 8 and increased his EPS estimates for this year and next to incorporate the buyback plan. Baptista estimates that Femsa will pay shareholders more than $2.7 billion this year, the equivalent of some 7% of its market capitalization, between repurchases and dividends. He expects that it will deliver about $8 billion, or 22% of its market value, over the next three years. Femsa also sports a 0.5% dividend yield. Baptista has a price target of 270 pesos, or $15.25, on Femsa’s local shares, which trade under the ticker FEMSAUBD, up 30% from Wednesday’s close.

Femsa’s ADRs trade at just over 20 times forward earnings, in line with their five-year average. That doesn’t sit right with Allspring’s Irwin, who notes that the multiple is lower than it was before the pandemic, despite the company having higher growth and doing a better job of returning capital to shareholders.

Femsa also trades at a discount to its net asset value, Irwin says. His sum-of-the-parts analysis suggests the company is worth $49.7 billion, compared with the market capitalization of $37 billion, suggesting a 26% discount to its value. The difference between the two “will continue to narrow,” he says, as the company rewards shareholders and builds out its core beverage and C-store businesses.

>>> Weekly Market Update

Weekly Market Update: Wild week Ends with Biden Candidacy Still in Question

Volatility resurfaced in a major way this week as investors absorbed a deluge of news making events. At the top of that list was a failed assignation attempt on Former President Trump over the weekend that reverberated across both the political landscape and markets. Odds of a Trump election victory and perhaps Republican sweep only climbed into the Republican convention, while the pressure on President Biden to bow out mushroomed. Small cap stocks continued to outperform megacap tech by a wide margin in a extension of the forced rotational trade that gripped markets last week. On Tuesday the Dow surged by more than 700 points helped in part by several Q2 earnings reports. June retails sales data bested expectations by a fairly wide margin suggesting the US economy may not be decelerating as quickly as some of the recent data has suggested. Nevertheless, the Fed's Kugler may have stoked the flames further by indicating she saw a rate cut coming, potentially sooner rather than later if the unemployment rate continues to move higher.

Midweek US stock markets rolled over in a big way and it was led by the semis despite strong earnings reports from TMSC and ASML. Both President Biden’s and former President Trump’s commentary appeared to be the catalyst that sent SMH below its 50-day moving average and the VIX above 16, both for the first time since April. Separately, US initial jobless claims rose to a 1-year high forcing the Fed’s Goolsbee to call the cooling jobs market “definitely an area of concern.” Also, the Fed's Beige book saw seven Districts report some level of increase in activity, five noted flat or declining activity—three more than in the prior reporting period. Equity markets continued to track lower into Friday’s session when worldwide IT outages for some enterprise Microsoft users cast a pall on trading. For the week the Dow rose 0.7%, S&P lost 2%, NASDAQ fell 3.7% and the Russell 2K added another 1.7%.

The ECB left rates unchanged as expected this week and Lagarde emphasized Sep is "wide open" in an attempt to illustrate the rate path has not been predetermined. Sticky UK core and services CPI data seemed to push back expectations for a BOE rate cut supporting the Pound. But Friday’s weak UK June retail sales data appeared to keep an Augusrt rate cut on table. The BOJ appeared to intervene on behalf of the Yen for the third time since the cooler than expected US CPI print earlier this month.

J&J and UNH helped power the Dow higher this week as both saw big movers up post earnings. Bank of America and Goldman Sachs also came in with significant earnings beats. Blackstone deployed $34B in the quarter which was the highest amount in 2-years while saying they believe they positioned to be the largest investor in AI infrastructure in the world. Homebuilders initially moved up on bullish comments and a beat by D.R. Horton. Domino's pizza slumped after US SSS missed estimates and management ratcheted back international expansion plans for this year. Netflix beat on the bottom line but top line growth and guidance seemed to disappoint. PPG industries and JB Hunt were just two of handful of disappointing cyclical/industrial firms globally to report disappointing results and or cut their outlook. On the other hand Steal Dynamics noted that inventories have plumbed to such low levels that prices is reached and inflection point to the upside. Consumers spent total $14B +10.5% y/y during Amazon prime days despite the offering steep discounts. On Friday the world was upended by bug in a software update from cybersecurity name Crowdstike causing wide spread IT outages for Microsoft windows users. CRWD shares sold of hard on real worries of lasting reputational damage and liability. Starbucks rallied late in the session report activist Elliott has taken a significant stake.

MON 07-15
(RU) Russia Dep PM Novak: Russia might decide by the end-July whether to reinstate a gasoline exports ban from Aug if the situation on the domestic fuel market gets tense
(UR) Hungary PM Orban reportedly sent Ukraine peace proposals to EU leaders after meeting Ukraine Pres Zelenskiy, Russia Pres Putin and Former US Pres Trump during last few weeks - press
(UR) Ukraine Pres Zelenskiy: Want Russia representative to join next peace summit; Aim to have all elements of peace plan ready for second summit to take place in Nov 2024; Changes in Ukraine govt being discussed; Ukraine will receive invitation to join NATO once the war has ended
(US) Reportedly 1.3M member Teamsters union considering withholding endorsement of both Biden and Trump candidacies - press [**Note: The Teamsters endorsed Biden in 2020]
(US) Newly-nominated Trump VP running-mate, J.D. Vance (R-OH): VP needs to support President in enacting agenda; China is the biggest threat to our country and we are completely distracted from it - first comments at RNC as running-mate
(US) Elon Musk says he commits ~$45M a month to pro-Trump SuperPAC – WSJ
(US) FORMER PRES TRUMP SELECTS SEN. J.D. VANCE (R-OH) AS VP RUNNING MATE - TRUTH SOCIAL POST
(US) US Pres Biden: I will be on the ballot 'unless I get hit by a train'; Will debate Trump again in Sept, as earlier agreed - interview comments [**Note: VP Harris also accepted debates with JD Vance]
(US) Reportedly Trump met with Robert F. Kennedy Jr. earlier today to seek possible endorsement - Politico (update)
(US) Fed's Goolsbee (non-voter for 2024): Rate cuts will soon be warranted; Last weeks mild June inflation reading makes him more confident that price pressures are easing in a way that supports lowering interest rates – WSJ
(US) Adobe Analytics estimates 2024 Prime Day expected to drive $14B online for US retailers
(US) JULY EMPIRE MANUFACTURING: -6.6 V -8.0E; New orders, Employment remain negative
BOSS.DE Reports prelim Q2 Rev €1.02B v €1.0B y/y; Cuts FY24 guidance, notes ongoing uncertainties regarding the future development of global consumer sentiment
BLK Reports Q2 $10.36 v $9.96e, Rev $4.81B v $4.86Be
BND *US 30-YEAR YIELD RISES ABOVE 2-YEAR YIELD FOR THE FIRST TIME SINCE JAN 2024
BRBY.UK Issues Q1 Trading Update: Retail Rev £458M v £589M y/y; Retail Comp Sales -21% v +18% y/y; Slowdown in trading continued into July; To halt dividends for FY25; Expect to report a H1 FY25 operating loss and FY25 operating profit to be below current consensus
GS Reports Q2 $8.62 v $8.52e, Rev $12.7B v $12.6Be; Notes improving, but complex environment
RWA.UK Issues Q2 Trading update: Q2 Net fee income £84.8M, -15% y/y, -12% y/y (cc); June Fees -18% (cc) y/y, whilst new job flow in the month was also weaker than expected
UHR.CH Reports H1 (CHF) Net 147M v 498M y/y, Op 204M v 500.2Me, Rev 3.45B v 3.77Be; Notes sharp drop in demand for luxury goods in China; Sees strong growth in Japan and the US in H2 2024

TUES 07-16
(DE) GERMANY JULY ZEW CURRENT SITUATION SURVEY: -68.9 V -74.8E; EXPECTATIONS SURVEY: +41.8 ADJ V +41.0E; Notes for the first time in a year, economic expectations for Germany are falling
(EU) ECB Q2 Bank Lending Survey: EU consumer loan demand rises for first time since 2022
(JP) BANK OF JAPAN (BOJ) ACCOUNTS DATA SUGGESTS ~¥2.1T (~$13B) OF FX INTERVENTION ON FRI, JULY 12TH - PRESS
(UR) Hungary PM Orban letter to EU leaders: It is generally observed that Russia-Ukraine military conflict will radically escalate in the near future; Trump ready to act as a peace broker immediately after his election
(US) Goldman Sachs analysts: Our base case remains for a September Fed rate cut, but we also see solid rationale for cutting as early as July
(US) Atlanta Fed GDPNow: Raises Q2 GDP forecast from 2.0% to 2.5% (update)
(US) US Pres Biden on conditions which would make him drop out of 2024 race: If I had some medical condition that emerged, if somebody, the doctors came and said you've got this problem, that problem; There is more to do, and I am reluctant to walk away - preview of interview to be aired on Wed, 22:00ET
(US) REPORTEDLY US PRES BIDEN TO ANNOUNCE SUPPORT FOR MAJOR SUPREME COURT CHANGES - Washington Post
(US) JUN NAHB HOUSING MARKET INDEX: 42 V 43E
(US) JUN ADVANCE RETAIL SALES M/M: 0.0% V -0.3%E; RETAIL SALES (EX-AUTO) M/M: +0.4% V +0.1%E; Retail Sales (control group) rose highest since March
(US) JUN IMPORT PRICE INDEX M/M: 0.0% V -0.2%E; Y/Y: 1.6% V +1.0%E
(US) Zillow: Inventory rose in June in all but five major metros while the nationwide deficit continues to shrink; Monthly home value growth, while still positive, hit a 14-year low for June as competition relaxes
005930.KR Reportedly plans new NAND flash production line at Pyeongtaek Plant 4 in South Korea; The move shows Samsung begins new investment in memory chips, ending prolonged output reduction - press
ADS.DE Reports better than expected prelim Q2 Rev €5.82B v €5.6Be, operating profit €346M; Raises FY outlook
BAC Reports Q2 $0.83 v $0.79e, Rev $25.4B v $25.2Be
CFR.CH Reports Q1 Rev €5.27B v €5.28Be; Notes low level of consumer confidence in China
FIVE Names Kenneth Bull as Interim CEO, effective immediately; Cuts Q2 $0.53-0.56 v $0.62e (prior $0.57-0.69), Rev $820-826M v $835Me (prior $830-850M)
JBHT TTN Earnings Call Summary: Cuts FY24 Capex $650-700M (prior: $800M-1.0B); On the demand side, Q2 felt more like what we're accustomed to seeing prior to the pandemic disruption; During June, did see a nice seasonal lift in volume, particularly toward the end of the month
LUV Partners with Amazon for Prime Day deal; Prime members can save up to 30% off base fares for travel on Southwest [**Note: the first airline partner for Amazon Prime Day]
PNC Reports Q2 $3.39 v $3.00e, Rev $5.41B v $5.30Be; Nonperforming loans +5%
UNH Reports Q2 $6.80 v $6.65e, Rev $98.9B v $98.7Be; Increases estimate for Cyberattack impact on FY24 EPS from $1.15-1.35/shr to $1.90-2.05/shr; Intends to sell remaining South American ops

WED 07-17
(US) Former House of Representatives speaker Pelosi reportedly told Pres Biden that polls show that he Cannot beat Trump; Pelosi said to have told she and other Democratic lawmakers worry that he’s dragging down the party; One Pelosi ally said it was possible she would press Biden publicly to give up his spot atop the Democratic ticket - US press [**Note: Axios piece earlier said Biden respects Pelosi's iconic stature, "he would listen to her"]
(AU) AUSTRALIA JUN EMPLOYMENT CHANGE: +50.2K V +20.0KE; UNEMPLOYMENT RATE: 4.1% V 4.1%E
(NZ) New Zealand sells total NZ$500M vs. NZ$500M indicated in 2029, 2034 and 2037 bonds
(UK) King's Charles III Speech: UK priority is planning reform, housebuilding; UK govt to legislate to ensure all significant tax and spending changes are subject to independent assessment by OBR; Will legislate to strengthen audit and corporate governance; UK economic policy to be based on stability - comments on first program for UK Labour government
(UK) JUN CPI M/M: 0.1% V 0.1%E; Y/Y: 2.0% V 1.9%E; Services CPI remains sticky
(US) JUN HOUSING STARTS: 1.353M V 1.300ME (bounce from pandemic lows); BUILDING PERMITS: 1.446M V 1.400ME
(US) Mid-July Manheim wholesale used vehicle Index: 199.7 v 196.1 prior; +1.8% m/m, -5.7% y/y
(US) TTN Note: During Tue, July 16th speech at N.A.A.C.P. conference, US Pres Biden said "Kamala Harris is not only a great vice president; She could be president of the US.”
(US) Unidos Official: US Pres Biden tests positive for Covid-19, noted that Biden said he could not appear at the Unidos event
ALLY Raises lower-end FY24 NIM 3.30% v 3.35% y/y (prior 3.25-3.30%); Peak loss timing of 2022 vintage is key driver of H1 2024 net charge-offs – slides
ANTO.UK Reports Q2 copper production 155.3Kt, +20% q/q; Sees FY24 production towards lower-end of outlook
ASML.NL Reports Q2 €4.01 v €3.54e, Rev €6.24B v €6.00Be; Q2 bookings strong, but guides Q3 below estimates; Still expect industry recovery to continue in H2 2024
BA IAM Union confirms that Seattle area factory workers approve strike with vote of >99% - financial press [**Note: IAM workers contract expires on Sept 12th]
CRM Announces Einstein Service Agent, Salesforce’s first fully autonomous AI agent; Einstein Service Agent interacts with large language models (LLMs) by analyzing the full context of the customer’s message and then autonomously determining the next actions to take
ELV Reports Q2 $10.12 v $9.99e, Rev $43.9B v $43.0Be; Affirms FY24
GTLB Said to be exploring a sale after attracting acquisition interest, including from Datadog – press
KRO Reports prelim Q2 Rev $495-510M v $568Me; Implemented TiO2 selling price increases – filing
JNJ Reports Q2 $2.82 v $2.71e, Rev $22.5B v $22.4Be; Cuts FY24 eps outlook as costs associated with recent strategic acquisitions more than offset improved performance
ROG.CH Unit Genentech announces positive Phase I results of oral once-daily GLP-1 receptor agonist CT-996 for treatment of people with obesity; Adj mean weight loss of -6.1% within four weeks; Notes CT-996 could potentially be dosed without regard to meal timing, thereby affording greater dosing flexibility for patients; Could potentially be used for oral weight maintenance therapy following weight loss induced by injectables
STLD Reports Q2 $2.73 v $2.67e, Rev $4.63B v $4.42Be; Cust inventories 'incredibly low' - Believe steel pricing has reached a pivot point to the upside
SYF Reports Q2 $1.55 v $1.35e, Rev $4.5B v $4.44Be

THRS 07-18
(EU) EU Commission President Von Der Leyen: I will launch clean industry deal to cut emissions and energy prices; Will appoint a Commissioner for Defense; Will focus on building a "True European Defence Union" over next five years - guidelines for next 5 years
(EU) ECB Chief Lagarde: Question of what to do in September 'wide open'; Determined not to have predetermined rate path - press conf comments
(EU) EU Commission President Von Der Leyen wins EU parliament vote to remain head of the commission
(EU) ECB LEAVES KEY RATES UNCHANGED; AS EXPECTED
(EU) ECB hawks said to be open to September rate cut provided upcoming data confirm disinflation is underway - press citing ECB sources
(EU) ECB officials reportedly consider if only one additional cut is feasible in 2024 - press
(FR) French lawmakers reelected the centrist candidate Braun-Pivet from Macron’s party to a second term leading the National Assembly; Three voting rounds were needed in indication of divisions – press
(JP) BANK OF JAPAN (BOJ) ACCOUNTS DATA SUGGESTS NO NEW INTERVENTION ON JULY 17TH – PRESS
(JP) JAPAN JUN NATIONAL CPI Y/Y: 2.8% V 2.9%E; CPI EX-FRESH FOOD (CORE) Y/Y: 2.6% V 2.7%E
(RU) Russian Deputy Foreign Min Ryabkov: Russia does Not exclude deployment of missiles with nuclear warheads in response to deployment of US missiles in Germany
(UK) UK Chancellor of the Exchequer (Fin Min) Reeves: Difficult decisions ahead to fix UK economy; Want to make it easier for UK firms to sell in EU; New UK fiscal lock to prevent Truss-style turmoil - tv interview
(US) JULY PHILADELPHIA FED BUSINESS OUTLOOK: 13.9 V 2.9E (above all estimates); New Orders: +20.7 v -2.2 prior (highest since March 2022)
(US) Reuters citing one Biden campaign official source on Biden candidacy: "Yes, it's over. Just a matter of time"; Another source said "Biden's soul searching is actually happening, I know that for a fact... He's thinking about this very seriously."
(US) INITIAL JOBLESS CLAIMS: 243K V 229KE (1-year high); CONTINUING CLAIMS: 1.867M V 1.856ME (highest since early Mar 2024)
(US) TTN Reminder: International Longshoremen's Association (ILA), which represents 45,000 dockworkers at US East and Gulf Coast ports, last week highlighted a lack of progress in negotiations with the United States Maritime Alliance (USMX) over a new 6-year master contract; Tier1 analysts see the lack of progress heightening the risk for a potential strike in October 2024 [**Note: current ILA contract set to expire on Sept 30th, 2024]
(US) Fed's Goolsbee (non-voter for 2024): We've had better months of inflation data; Inflation fight is not done, but feels much better
(US) Elon Musk denies speculation that he has committed ~$45M a month to pro-Trump SuperPAC - post on X
(US) Redfin: Pending sales down 5.6% y/y, the biggest decline in eight months; Redfin’s Homebuyer Demand Index—a measure of requests for tours and other buying services from Redfin agents—is down 15%; Daily average mortgage rates have dropped to their lowest level since February after last week’s cooler-than-expected inflation report
(US) Atlanta Fed GDPNow: Raised Q2 GDP forecast from 2.5% to 2.7% (update from July 17th)
005930.KR Reportedly Samsung union (~30K workers, about 25% of Samsung total) and Samsung management may resume wage talks as its strike enters into 11th day - press
005930.KR Follow up: Management re-starts talks with Samsung union (as expected) - financial press
ABBN.CH Reports Q2 Net $1.10B v $1.03Be, Rev $8.24B v $7.39Be; Orders miss estimates
DHI Reports Q3 $4.10 v $3.80e, Rev $9.97B v $9.68Be; Announces $4.0B share buyback
DHI Guides Q4 home sales gross margin similar q/q; Construction times have been falling; Buyer incentives remain elevated - earnings call
DPZ Reports Q2 $4.03 v $3.70e, Rev $1.10B v $1.10Be; To miss FY24 international store growth goal citing challenges in both openings and closures being faced by Domino's Pizza Enterprises
TSM *CFO: GUIDES Q3 REV $22.4-23.2B V $22.5BE (V $17.3B Y/Y); RAISES FY24 REV OUTLOOK NOTING "DEMAND IS SO HIGH AND ITS CUSTOMERS DOING VERY WELL" - EARNINGS CALL
MAN Reports Q2 $1.24 v $1.27e, Rev $4.52B v $4.52Be; Notes permanent recruitment activity softened slightly further q/q and employers in North America and Europe continue to remain cautious
NOKIA.FI Reports Q2 €0.06 v €0.05e, Adj Op €423M v €372Me, Rev €4.47B v €4.84Be; Board now intends to accelerate our on-going €600M buyback program with the view to completing it by the end-2024 v end-2025 prior
NFLX Ads will become a "meaningful contributor" to Rev by 2026; ARM on Ad tier lower than Non-Ad tier - earnings call
NFLX Reports Q2 $4.88 v $4.70e, Rev $9.56B v $9.53Be; To start facing out lowest-cost ad-free Basic plan in the US and France; Notes ad tier membership +34% q/q
NOVN.CH Reports Q2 Core EPS $1.97 v $1.85e, Rev $12.5B v $12.2Be
OPENAI.IPO Reportedly in talks with Broadcom about developing new AI chip, discussions are in an early stage - The Information
PPG Reports Q2 $2.50 v $2.48e, Rev $4.79B v $4.91Be; Cuts EPS outlook and guides Q3 below est; Notes global automotive builds weakened as the quarter progressed; US economic conditions have remained subdued in several end-use markets
TSM Reports Q2 (NT$) Net 247.8B v 238.8Be, Op 286.6B v 202.0B y/y, Rev 673.5B v 673.5B prelim (v 480.8B y/y)
WAL Reports Q2 $1.75 v $1.71e, NII $656.6M v $550.3M y/y

FRI 07-19
(UR) Hungary Foreign Min: Ukraine's decision to block Lukoil oil transfers to Hungary and Slovakia through Ukraine seriously endangers safety of supply over long run
(US) BOFA INSTITUTE: WEEK-TO-JULY 13TH TOTAL CARD SPENDING -1.6% Y/Y V -0.5% AVERAGE IN JUNE; The drop compared to last week was likely at least partly due to the impact of Hurricane Beryl
REPORTEDLY 'MANY' WINDOWS USERS GLOBALLY FACE MASSIVE OUTAGE AND EXPERIENCE BLUE SCREEN OF DEATH (BSOD) ERRORS DUE TO NEW CROWDSTRIKE UPDATE - PRESS
AXP Card Member Loans 30+ Days Past Due at 1.2% v 1.3% q/q v 1.5% pre-pandemic - earnings slides
CMCSA *SKY NEWS CHANNEL HAS NOT BEEN ABLE TO BROADCAST LIVE THIS MORNING – PRESS
CMCSA *SKY NEWS CHANNEL BACK ON AIR AFTER OUTAGE – PRESS
CRWD *REPORTEDLY NOW IN THE PROCESS OF ROLLING BACK THE UPDATE CAUSING OUTAGES GLOBALLY - CNBC [*Note: earlier, major US airlines grounded all flights, UK's LSE and major oil/gas trading platforms had tech issues, EU airports reported system incidents and UK supermarkets, key Australian banks, media and govt offices were experiencing outages]
CRWD *CEO: THIS IS NOT A SECURITY INCIDENT OR CYBERATTACK; ISSUE HAS BEEN IDENTIFIED, ISOLATED AND A FIX HAS BEEN DEPLOYED - COMMENTS ON X
ELUXB.SE Reports Q2 (SEK) adj Op 419M v -124M y/y, Rev 33.8B v 32.7B y/y; Market conditions in Q2 remained similar to the most recent quarters; Demand in North America has been stable year to date, supported by the aggressive pricing environment; Notes it outperformed the market in Europe and North America
HBAN Reports Q2 $0.30 v $0.28e, Rev $1.82B v $1.81Be
LLY Mufengda (tirpatide injection) approved by National Medical Products Administration (NMPA) for indication of long-term weight management
LSEG.UK *REPORTEDLY LSE PLATFORMS SUFFER OUTAGE PREVENTING PRESS RELEASES FROM BEING PUBLISHED – PRESS
MSFT *Statement: Underlying cause of global outage has been fixed
RF Reports Q2 $0.52 v $0.49e, Rev $1.78B v $1.75Be; Notes favorable credit trends
SBUX Reportedly Activist Elliott discloses large stake; Aims to push Starbucks privately to boost stock price - WSJ
TRV Reports Q2 $2.51 adj v $2.22e, Rev $11.3B v $11.5Be; Continue to be very confident in the outlook
WPRO.IN CEO: Seeing momentum in consumer business in US; No impact from Crowdstrike to WiPro - post earnings comments

>>> Europe : Brokers Upgrades & Downgrades - 19th of July 2024 V2(+)

>>> Up
* About You Raised to Buy at UBS; PT 6 euros (+)
* AJ Bell Raised to Buy at Jefferies; PT 485 pence
* ARM Holdings PLC ADRs Raised to Overweight at Morgan Stanley
* Barclays PT Raised to 341 pence from 335 pence at Jefferies
* Covivio Hotels Raised to Buy at Invest Securities SA (+)
* F-Secure Raised to Buy at SEB Equities; PT 2.30 euros
* Marathon Oil Raised to Overweight at Wells Fargo; PT $29
* Mips Raised to Buy at Jefferies; PT 645 kronor
* QinetiQ PT Raised to 570 pence from 470 pence at Deutsche Bank (+)
* Wulff-Group Raised to Accumulate at Inderes; PT 3 euros

>>> Down
* Bank of America Cut to Neutral at Phillip Secs; PT $45
* Choice Hotels Cut to Underweight at JPMorgan; PT $120
* Cogelec SACA Cut to Add at Gilbert Dupont; PT 11.90 euros (+)
* Enea Cut to Hold at ABG; PT 90 kronor
* Eni Cut to Hold at Stifel; PT 14.70 euros
* Gjensidige Cut to Underperform at Jefferies; PT 155.50 kroner
* Host Hotels Cut to Underweight at JPMorgan; PT $18
* Husqvarna Cut to Hold at Nordea; PT 95 kronor (+)
* Husqvarna Cut to Hold at Kepler Cheuvreux; PT 85 kronor (+)
* Molson Coors PT Cut to $57 from $69 at Piper Sandler
* NCC Cut to Underperform at Handelsbanken (+)
* Novartis Cut to Hold at Deutsche Bank (+)
* PepsiCo Cut to Hold at DZ Bank; PT $183 (+)
* Telia Cut to Hold at Kepler Cheuvreux; PT 32 kronor (+)
* Vitrolife Cut to Underperform at Handelsbanken (+)
* Vincit Cut to Reduce at Inderes; PT 2.60 euros

>>> Initiation
* Aedifica Rated New Overweight at JPMorgan; PT 70 euros
* Canada Goose Rated New Outperform at Wedbush; PT C$21
* Heidelberg Materials Rated New Buy at Redburn; PT 136 euros
* Holcim Rated New Neutral at Redburn; PT 95 Swiss francs
* Smurfit WestRock Rated New Overweight at Morgan Stanley
* VAT Rated New Neutral at BNPP Exane; PT 514 Swiss francs

>>> Call
* Gjensidige Downgraded at Jefferies on Risk of Cut to Dividend
* Goldman Strategists See Risk of a Setback for Stocks This Summer
* Mips Upgraded to Buy at Jefferies, Momentum Set to Continue
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Challenges : Arnault, Niel, Bettencourt Meyers… qui sont les 500 plus grandes fo

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Arnault, Niel, Bettencourt Meyers… qui sont les 500 plus grandes fortunes professionnelles de France en 2024 ?

500 fortunes. Malgré un climat tendu, le montant des richesses accumulées dans notre 29e palmarès progresse. Si les héritiers se taillent la part du lion, les créateurs d’entreprise gagnent du terrain.

Cette 29e édition des Fortunes de France est un cru particulier. Par sa date, d’abord. Décalée à la mi-juillet, à cause des élections législatives, c’est la parution la plus tardive de son histoire. Ensuite, parce que malgré une économie pas très florissante et un climat politique pour le moins tendu, où les riches sont la cible de projets fiscaux, les plus importants patrimoines professionnels continuent leur marche en avant. Les 500 fortunes semblent avoir adopté la devise olympique : « Plus vite, plus haut, plus fort. »

Pour la première fois, leur fortune cumulée dépasse les 1 200 milliards d’euros. Grâce à la bonne tenue de la Bourse (les cours retenus pour les estimations sont ceux du 7 juin dernier, juste avant la dissolution de l’Assemblée nationale) et aux bons résultats des entreprises mais aussi grâce à quelques entrées fracassantes, directement dans le cercle des milliardaires.


On y retrouve à la fois des entrepreneurs « à ­l’ancienne », comme les frères Marciano, fondateurs de la marque de jeans Guess cotée à New York, et des fortunes du numérique, qui se font très, très vite. Par exemple, le fondateur de la messagerie cryptée Telegram, Pavel Dourov, qui fait une entrée remarquée dans le classement, puisqu’il s’est vu attribuer la nationalité française. Ou les cofondateurs de Mistral AI, Guillaume Lample, Arthur Mensch et Timothée Lacroix. En un an, ces trentenaires ont déjà levé (en trois fois) plus d’1 milliard d’euros, valorisant leur licorne de l’intelligence artificielle autour d’une demi-douzaine de milliards.

gagnent du terrain.


Cette 29e édition des Fortunes de France est un cru particulier. Par sa date, d’abord. Décalée à la mi-juillet, à cause des élections législatives, c’est la parution la plus tardive de son histoire. Ensuite, parce que malgré une économie pas très florissante et un climat politique pour le moins tendu, où les riches sont la cible de projets fiscaux, les plus importants patrimoines professionnels continuent leur marche en avant. Les 500 fortunes semblent avoir adopté la devise olympique : « Plus vite, plus haut, plus fort. »

LIRE AUSSIDécouvrez le classement 2024 des 500 fortunes de France

Pour la première fois, leur fortune cumulée dépasse les 1 200 milliards d’euros. Grâce à la bonne tenue de la Bourse (les cours retenus pour les estimations sont ceux du 7 juin dernier, juste avant la dissolution de l’Assemblée nationale) et aux bons résultats des entreprises mais aussi grâce à quelques entrées fracassantes, directement dans le cercle des milliardaires.



On y retrouve à la fois des entrepreneurs « à ­l’ancienne », comme les frères Marciano, fondateurs de la marque de jeans Guess cotée à New York, et des fortunes du numérique, qui se font très, très vite. Par exemple, le fondateur de la messagerie cryptée Telegram, Pavel Dourov, qui fait une entrée remarquée dans le classement, puisqu’il s’est vu attribuer la nationalité française. Ou les cofondateurs de Mistral AI, Guillaume Lample, Arthur Mensch et Timothée Lacroix. En un an, ces trentenaires ont déjà levé (en trois fois) plus d’1 milliard d’euros, valorisant leur licorne de l’intelligence artificielle autour d’une demi-douzaine de milliards.



Une trajectoire express déjà prise de vitesse par la nouvelle pépite de l’IA française, baptisée H : le jour même du lancement de la jeune pousse, le 21 mai dernier, ses cofondateurs, Charles Kantor, Julien Perolat et Laurent Sifre, ont annoncé une levée d’amorçage deux fois plus élevée que celle de Mistral AI en juin 2023, soit 220 millions de dollars. Et ce auprès d’investisseurs de renom bien classés dans notre palmarès, comme Bernard Arnault ou Xavier Niel. A côté de ces fusées, Clément Delangue, Julien Chaumond et Thomas Wolf, les fondateurs d’Hugging Face, une plateforme d’outils open source pour l’IA, valorisée 4,5 milliards de dollars l’été dernier, huit ans après sa création, feraient presque figure d’escargots.

Des revers de fortune
A l’inverse, le millésime 2024 compte quelques impressionnants revers de fortune. Même si le secteur du luxe a trusté les premières places du classement ces dernières années, on observe que les patrimoines de Bernard Arnault et François Pinault ont reculé de plusieurs milliards d’euros, notamment en raison des difficultés du marché chinois.

Autre secteur qui souffre, avec la remontée des taux d’intérêt et le ralentissement des ventes depuis deux ans : l’immobilier. « Le marché français a connu un net recul cette année, il faut que vous en teniez compte », nous répond ainsi le fondateur d’un promoteur indépendant, qui trouve notre estimation de son patrimoine trop élevée.

Enfin, l’année aura été chargée sur le plan judiciaire : de l’arrestation d’Armando Pereira, le bras droit de Patrick Drahi, au Portugal l’été dernier pour des faits présumés de corruption, à la condamnation ce 2 juillet de Franck Julien, le patron d’Atalian, à quatre ans de prison (dont dix-huit mois ferme) pour « abus de bien sociaux, blanchiment aggravé et complicité de faux et d’usage de faux ».

Une passion pour la création d’entreprise
Challenges s’est penché cette année sur l’origine des 500 fortunes. Traduisent-elles le succès d’un projet entrepreneurial, créé ex nihilo, à partir d’une idée originale, porteuse de richesse ? Ou, au contraire, s’inscrivent-elles dans la transmission de sociétés d’une génération à la suivante, dans ces familles où l’on se donnerait « la peine de naître, et rien de plus », selon la formule célèbre de Beaumarchais dans le monologue de Figaro ? Des mots qui claquent mais paraissent désormais anachroniques. Aujourd’hui, les héritiers doivent se montrer créatifs pour faire fructifier ce dont ils ont hérité dans un monde qui change de plus en plus vite.

En décembre 2021, un rapport du Conseil d’analyse économique montrait qu’au XXIe siècle l’héritage est redevenu le facteur essentiel de la constitution du patrimoine en France. De 35 % au début des années 1970, la part du patrimoine transmis est ainsi remontée à 60 %, alors qu’au XXe siècle, l’écart avec la part due aux initiatives individuelles s’était resserré, montrant une forme d’affranchissement de l’appartenance sociale. Mais cette situation ne semble guère choquer les Français. Selon un sondage Odoxa publié en avril dernier par Challenges, 77 % d’entre eux se disent opposés aux droits de succession, 84 % estimant même qu’il faudrait les ­diminuer.

Autre tendance de fond : la passion pour la création d’entreprise qui anime les Français, parfaitement illustrée par une étude Bpifrance, publiée en janvier dernier. En dix ans, 8,2 millions d’entreprises ont ainsi vu le jour (soit une hausse de 7 % par an). Mieux encore : si 25 % des Français ont envie de créer leur entreprise, la proportion monte à 52 % pour les 18-25 ans. Une envie de vivre sa vie professionnelle de façon autonome, tout autant qu’un rêve d’enrichissement, à l’américaine.

Des femmes pénalisées
Le classement de Challenges est peut-être l’une des sources de ce nouveau rêve. L’analyse de ses résultats nous apprend que près de la moitié des fortunes recensées (48,3 %) sont le fait de self-made-men. Autrement dit, on peut aussi faire fortune en France ! Seul regret, peu de véritables self-made-women en vue, à l’exception d’une ou deux figures telles que Danièle Kapel-Marcovici, la très féministe patronne de Raja, qui a commencé à travailler dès son plus jeune âge avec sa mère.

L’origine de cette distorsion, on le sait, provient de l’extrême difficulté des femmes à obtenir des financements des investisseurs. Une situation qu’analysaient Céline Bessière et Sibylle Gollac dans leur ouvrage Le Genre du capital – Comment la famille reproduit les inégalités (La Découverte, 2020).

Selon leurs calculs, les inégalités de patrimoine entre les femmes et les hommes sont passées de 9 % en 1988 à 16 % en 2016 en France. Vrai pour les Françaises, vrai pour les plus riches d’entre elles. Mais les choses évoluent, avec quelques femmes de moins de 40 ans qui font leur apparition dans notre classement 2024, comme Morgane Sézalory, fondatrice de Sézane. Ou bien Eléonore Crespo, une trentenaire diplômée de l’ENS Paris-Saclay et de l’Ecole des Mines, qui a travaillé chez Google et dans un des plus grands fonds d’investissement américain avant de créer en 2019 sa propre entreprise, Pigment, avec Romain Niccoli, un des fondateurs de Criteo.

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