FT : Nissan shares drop on reports of cut to earnings outlook

Nissan shares drop on reports of cut to earnings outlook
Carmaker had downgraded profit forecast in February on weak US sales

Nissan shares slid on Wednesday after Japanese media reported that the carmaker would announce a substantial cut to its earnings outlook.

Shares in the Japanese carmaker fell 3.6 per cent after TV Tokyo and Nikkei reported that Nissan would cut earnings estimates for the fiscal year to March 2019 following weak sales in North America. 

The company had already cut its earnings outlook once this year, saying in February that it expected a net profit of ¥410bn ($3.7bn) for that period, down from the ¥500bn it projected in November 2018. It also cut sales targets in all its key markets, including Japan, China, Europe and the US. 

Nissan declined to comment. 

Nissan is wrestling with the fallout from Carlos Ghosn’s ouster. The former chairman had led the group for two decades, before he was arrested in November 2018 on charges that he understated his pay. He was formally ejected from the company in a shareholder vote in April, but maintains his innocence. 

Hiroto Saikawa, Nissan’s chief executive, has sought to stop the decline in US profitability that was blamed on aggressive pursuit of market share under Ghosn’s leadership. 

>>> What to look at today - 24th of April 2019

Asian stocks fell Wednesday with the region lacking the catalyst that propelled their U.S. counterparts to record highs: stronger corporate earnings releases. Australia’s dollar slumped after a surprisingly weak inflation reading.
The MSCI Asia Pacific Index headed for its lowest close in three weeks, with shares dropping from Tokyo and Seoul to Shanghai and Hong Kong. Australian equities bucked the trend as flat consumer price growth stoked bets on lower interest rates and pulled down the Aussie, bolstering its competitiveness. Earlier, the S&P 500 Index marked fresh highs following favorable first-quarter figures from the likes of Twitter Inc., Lockheed Martin Corp. and Hasbro Inc. The dollar strengthened, while Treasury yields ticked lower.
US After Hours MANH +9%, TER +6.5%, EBAY +4.4%, IRBT -15%, RHI -10%, SYK -4%, TXN -2%, among notable earnings/guidance movers

Nikkei -0.27% Hang Seng -0.58% CSI +0.00% Shanghai -0.16% Shenzen +0.57%

Eur$ 1.1214 CNH 6.7264 CNY 6.7220 JPY 111.83 GBP 1.2937 CHF 1.002 TRY 5.5828 RUB 63.7270 WTIS65.96 -0.51%

S&P -0.10% EuroStoxx -0.29% Dax -0.23% FTSE -0.21% SMI +0.00%

Macro :
- Support for Swiss Corporate Tax Reform at 62%: Tamedia Poll

Keep an eye on :
- AC FP : Accor Plans 60 New Hotels in Africa, Half of Them in Egypt
- AED BB : *AEDIFICA TO RAISE UP TO EU418 MLN IN RIGHTS OFFERING
- AIR FP : Boeing Seeks FAA Approval of 737 Max Software Fix by May: Rtrs
- AKZA NA : Akzo Nobel 1Q Adjusted Operating Income Misses Lowest Est. (1)
- AKZA NA : Akzo Posts Profit Miss on Raw Material Burden, Auto Slowdown
- BIM FP : BioMerieux First Quarter Sales EU632M; Confirms FY Outlook
- CSGN SW : *CREDIT SUISSE 1Q GLOBAL MARKETS PRETAX CHF282M, EST. CHF170M
- DSY FP : Dassault Systemes Confirms FY Non-IFRS View Ex-Forex
- ELIOR FP : Elior Receives EU1.54b Binding Offer From PAI Partners for Areas
- ENG SM : Enagas First Quarter Net Income Meets Estimates
- HSW LN : Hostelworld Market-Share Loss in 2018 ‘Worrying,’ Berenberg Says
- ING FP : Ingenico Targets Ebitda Around EU700m in 2021
- IPN FP : Ipsen First Quarter Sales EU597.2m; Confirms FY Outlook
- MDXH BB : MDxHealth First Quarter Revenue $4.7 Mln Vs. $9.7 Mln Y/Y
- MUX GY : Mutares Sells 49% Stake in Indian JV to Thermax
- NHY NO : Hydro Reaches Agreement With U.S. DOJ on Sapa Profiles Probe
- NOD NO : Nordic Semiconductor 1Q Ebitda Loss Narrower Than Est.
- NOVN SW : Novartis 1Q Core EPS $1.21; Ups Core Op. Income Growth View
- OBEL BB : Orange Belgium 1Q Retail Service Revenue Beats Est.
- RAND NA : Randstad First Quarter Revenue 1.1% Above Estimates
- RCO FP : Remy 4Q Organic Revenue EU283.5m; Outlook Confirmed
- SAP GY : SAP Increases Operating Profit Outlook as Restructuring Begins
- SAP GY : Elliott Sees SAP Able to Achieve EU8.50 EPS in 2023
- SNBN SW : Moral Headaches Lurk for SNB Tending $141 Billion Stock Hoard
- STM FP : STMicroelectronics 1Q Net Revenue Misses Lowest Est.
- STCBV FH : Stockmann Cuts Profit Guidance Due to Weakened Outlook in Retail
- SSE LN : SSE Not Exciting, Better Utilities Names Out There, Citi Says
- TEL NO : Telenor’s Grameenphone 1Q Consolidated Revenue Rises to NOK3.57B
- TELE2 SS : Tele2 First Quarter Adjusted Ebitda Beats Highest Estimate
- VOLVB SS : Volvo 1Q Adjusted Operating Profit Beats Highest Est.
- VOLVB SS : Volvo: Truck Order Intake Dropped Mainly Due to North America
- WDI GY : SoftBank to Invest EU900m in Wirecard, Signs MoU on Partnership
- WDP BB : WDP First Quarter Adjusted EPS EU1.45 Vs. EU1.34 Y/Y
- XXL NO : XXL First Quarter Ebitda Misses Estimates

>>>> Europe : Brokers Upgrades & Downgrades - 24th of April 2019

>>> Up
* Hastings Upgraded to Overweight at JPMorgan; PT 2.65 Pounds
* Rocket Internet Upgraded to Buy at Bankhaus Lampe; PT 29 Euros
* Saga Upgraded to Neutral at JPMorgan; Price Target 80 Pence

>>> Down
* ADO Properties Downgraded to Hold at HSBC; PT 54 Euros
* Anglo American Downgraded to Neutral at JPMorgan; PT 23 Pounds
* Continental Downgraded to Hold at Bankhaus Metzler; PT 165 Euros
* Deutsche Wohnen Downgraded to Hold at HSBC; PT 46.50 Euros
* Direct Line Cut to Neutral at JPMorgan; Price Target 3.60 Pounds
* GB Group Downgraded to Hold at Stifel; PT 6 Pounds
* Nexity Downgraded to Add at AlphaValue
* SocGen Downgraded to Underweight at Santander; PT 28.42 Euros

>>> Initiation


>>> Call
* SSE Not Exciting, Better Utilities Names Out There, Citi Says

>>> US Close Dow +0.55% S&P +0.88% Nasdaq +1.32% Russell +1.61%


Closing Stock Market Summary

The S&P 500 (+0.9%) and the Nasdaq Composite (+1.3%) both set all-time closing highs on Tuesday in a broad-based advance. Investor sentiment was buoyed by a batch of positive earnings reports from widely-held companies and positive economic data.

The Dow Jones Industrial Average gained 0.6%, and the Russell 2000 gained 1.6%.

From the onset, it didn't look like Tuesday would be a record-setting day despite the earnings beats from a diverse set of companies that included United Technologies (UTX 140.02, +3.11, +2.3%), Coca-Cola (KO 48.21, +0.81, +1.7%), Verizon (VZ 57.15, -1.22, -2.1%), Procter & Gamble (PG 103.16, -2.85, -2.7%), Lockheed Martin (LMT 331.10, +17.84, +5.7%), Twitter (TWTR 39.77, +5.38, +15.6%), and Hasbro (HAS 100.65, +12.54, +14.2%).

Overall market reaction was muted heading into the open. Buying interest quickly picked up, though, and momentum accelerated soon after the release of the New Home Sales report for March at 10:00 a.m. ET.

New home sales in March increased 4.5% m/m to a seasonally adjusted annual rate of 692,000 (Briefing.com consensus 646,000), which was the strongest pace since November 2017. Lower prices and lower mortgage rates contributed to the pickup in sales activity.

Solid data out of the housing sector maintained an upbeat outlook for the U.S. economy, which should continue to bode well for corporate earnings prospects. A fear of missing out on further gains helped lift the S&P 500 above its prior record close by noon, where it would trade for the rest of the day. 

Separately, Walgreens Boots Alliance (WBA 53.22, -0.88, -1.6%) announced it will increase its minimum buying age for tobacco products to 21 on Sept. 1, 2019. Kohl's (KSS 75.48, +8.03, +11.9%) announced it will accept Amazon (AMZN 1923.77, +36.46, +1.9%) returns in all of its stores, starting in July. Qualcomm (QCOM 86.72, +4.75, +5.8%) was upgraded to Overweight from Equal-Weight at Morgan Stanley with a price target of $95.

U.S. Treasury yields remained lower on Tuesday. The 2-yr yield declined four basis points to 2.35%, and the 10-yr yield declined two basis points to 2.57%. The U.S. Dollar Index increased 0.3% to 97.59. WTI crude rose 1.1% to $66.33/bbl, nearing a six-month high. 

Reviewing Tuesday's economic data, which included New Home Sales for March and the FHFA Housing Price Index for February:

  • New home sales in March increased 4.5% m/m to a seasonally adjusted annual rate of 692,000 (consensus 646,000), which was the strongest pace since November 2017. Sales were up 3.0% yr/yr.
    • The key takeaway from the report is that the solid sales activity was helped by a 9.8% decline in the median sales price and lower mortgage rates, which goes to show the pent-up potential for sales activity if the combination of lower prices and lower mortgage rates persists.
  • The FHFA Housing Price Index for February increased 0.3%, down from an unrevised January reading of 0.6%.

Looking ahead, investors will receive the weekly MBA Mortgage Applications Index on Wednesday.

  • Nasdaq Composite +22.4% YTD
  • S&P 500 +17.0% YTD
  • Russell 2000 +17.5% YTD
  • Dow Jones Industrial Average +14.3% YTD

>>> US After Hours Summary: MANH +9%, TER +6.5%, EBAY +4.4%, IRBT -15%


After Hours Summary: MANH +9%, TER +6.5%, EBAY +4.4%, IRBT -15%, RHI -10%, SYK -4%, TXN -2%, among notable earnings/guidance movers

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: MANH +8.7%, TER +6.5%, EBAY +4.4%, HXL +4.1%, VICR +3.6%, SNAP +1.8%, SIX +1.2%, MMSI +1.1%

Companies trading higher in after hours in reaction to news: SYNL +23.3% (Privet Fund Management sends letter to the Board proposing to acquire all outstanding common stock for $20.00/share in cash), VIAB +1.3% (drifts higher in extended trading after CBS said it would suspend its search for another CEO after acting CEO Joseph Ianniello agreed to extend his role for six additional months), KSS +1% (continued strength), ABBV +0.8% (received FDA approval of SKYRIZI for moderate to severe plaque psoriasis; expected to be available in the U.S. in early May), HCC +0.7% (declared a special cash dividend of approximately $4.41 per share)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: IRBT -15%, SPN -11.5%, RHI -10.3%, SYK -3.7%, TSS -3.7%, EW -2.7%, TXN -2%, AMTD -1.9%, BURL -1.4% (announces CEO transition, sees Q1 adj EPS below consensus), CP -1.3%

Companies trading lower in after hours in reaction to news: CRZO -0.8% (announced earnings release date of May 7), ABMD -0.6% (light volume; still looking)

Chip names are lower following TXN earnings/cautious commentary: MRVL -1.4%, MCHP -1.2%, MXIM -1.1%, ON -1%, CY -0.9%

NYPost : Roy Disney’s granddaughter slams Bob Iger’s ‘insane’ salary

An outspoken Disney heir’s criticisms of CEO Bob Iger’s pay as “insane” has cast a Klieg light on the industry’s executive pay.

And the award for the highest paid CEO goes not to Iger — who earned $65.6 million in 2018, up 81% from the previous year — but to Discovery CEO David Zaslav, whose 2018 compensation surged 206% to $129.4 million.

The competition was kicked off Sunday by Abigail Disney, the granddaughter of Disney cofounder Roy O. Disney, who on Twitter blasted Disney for paying Iger 1,424 times what the median Disney employee earns.

“Let me very clear. I like Bob Iger,” she said. “But by any objective measure a pay ratio over a thousand is insane.”

A Disney spokesperson defended the CEO’s pay, saying, “Mr. Iger’s compensation is 90 percent performance-based and he has delivered exceptional value for shareholders.”

The thread stirred enough outrage for BTIG analyst Rich Greenfield to join the fray Monday with a Twitter chart shining a light on CEO pay in the media, tech and telecom industries.

“We played off of what Abigail wrote,” he said in a phone interview, “but we couldn’t help constructing the issue as a compensation problem not just for Disney but for the entire media industry.”

The chart focused on 11 “TMT” companies, and the data showed that some CEOs got big payouts even as investors lost money.

Over at Facebook, for example, CEO Mark Zuckerberg saw his pay jump 147.8% in 2018, while the stock fell 25%. And at CBS, interim CEO Joe Ianniello got paid $27.4 million even as the stock dropped 25.9%.

Greenfield said he was taken aback by the CBS board’s decision to pay Ianniello $27.4 million for just a few months of work — or just a few hundred-thousand dollars less than the $29.4 million earned by Netflix’s Reed Hastings.

“Why is CBS’ CEO making almost as much as Netflix’s?” Greenfield asked of Ianniello, who was put in the top spot in September after longtime boss Les Moonves left amid sexual harassment allegations.

Indeed, while CBS shareholders lost 26% in 2018, Netflix stock jumped over 39%, Greenfield said.

The chart’s outlier was Twitter’s Jack Dorsey, who received no compensation in 2018. Even Zuckerberg’s pay of $22.6 million might be considered small potatoes compared to the company’s $509 billion valuation.

AMC, by contrast, is valued at just $2 billion — yet the theatre chain’s CEO, Adam Aron, took home $9.5 million last year even as the stock declined 18.7%.

“When you see the CEO of an old-fashioned theater chain making $10 million while its stock fell nearly 20 percent, it’s nothing short of eye-opening,” Greenfield said.

One consolation for Disney investors might be the 18% gain in the stock last year. Discovery, by contrast, saw a 10% rise.

Zazlav also beats Iger when it comes to Abigail Disney’s concern over outsized CEO pay compared to that of median employees, with a ratio of 1,511 to 1.

A Discovery spokesman said Zaslav’s 2018 pay was boosted by a grant of option awards tied to a contract extension. “It’s really a five-year grant that got counted last year,” he said.

>>> Intu needs a buyer – and quickly Analysis 23 APR 2019 Analysts from Dealrepo

Intu needs a buyer – and quickly

Dealreporter

For a stock trading at 36% of book value, Intu’s [LON:INTU] latest deal looks like a good one. The real estate investment trust (REIT) is selling 50% of its Intu Derby shopping mall for GBP 186m, a sale which equates to 100% of the asset’s book value.
But Intu might need to go further if it wants to address mounting concerns over its GBP 4.9bn debt load: a capital hike – and even a refinancing – may be its only option if market chatter around a buyout fails to materialise.
Shares in Intu are down 51% over the past 12 months driven by its exposure to the UK’s weakening economy, structural concerns around High Street retailers – which are its key customers – and high levels of debt. And there is a growing consensus that, if Intu does not find a buyer soon, it will need to raise equity. Intu would need between GBP 1.5bn and GBP 2bn of new equity in order to bring its loan-to-value (LTV) ratio in line with peers Hammerson [LON:HMSO] and Land Securities [LON:LAND], analysts at Dealreporter’s sister service Debtwire argued in January.
A refinancing, including an equity injection, could be required in 2019, Deutsche Bank analysts argued on 26 March, because of a worsening appetite from banks to lend to the sector. Intu will struggle during 2018, Deutsche Bank’s analysts said, because assets sales are unlikely to be sufficient to see Intu hit its target LTV.
Debtwire’s analysts calculated asset sales worth around GBP 2.5bn would be needed for LTV to be brought in line with peers. Placed in this perspective, disposals like Derby barely move the dial. Even if Intu succeeds in its plan to sell its Spanish assets, which have a market value of GBP 861m, according to its annual report, it is a long way short of achieving that outcome. Intu's debt does not have a credit rating from the main agencies S&P, Moody’s and Fitch.
Buyout prospects are also arguably diminished by Intu’s latest deal. Bringing in joint venture partners, like Kuwait Investment Office at Derby, complicates Intu’s capital structure and reduces the rationale for potential bidders. Intu has also recently appointed a new CEO, albeit on an interim basis, after spending the better part of a year searching for a replacement for outgoing boss David Fischel. Positives for the buyout case include a recent stakebuild by private equity fund Orion Capital.
After two failed deals in two years and a bleak commercial outlook, the clock is ticking for Intu to secure a deal or face the consequences: potentially through a refinancing and equity raise.
Intu has a market capitalisation of GBP 1.3bn.

>>>GNC - Strength attributed to introduction of new cannabidiol (CBD) infused pr

Strength attributed to introduction of new cannabidiol (CBD) infused products (update)
- Announced that the company is now offering topical cream products containing cannabidiol (CBD), in select retail locations and online in 23 states and the District of Columbia.
- By introducing 12 channel exclusive CBD products from Physician’s Grade, an innovative health and wellness company, and Myaderm, a manufacturer of advanced cannabinoid products, GNC expects to attract the growing customer base looking for innovative offerings in the CBD market.
- The available Physician’s Grade products include the company’s face creams, luxe body lotion, scalp treatment and revitalizing shampoo. Myaderm’s offerings include their four popular topical creams, which are the CBD Body Cream, available in two sizes, the Double Strength CBD Body Cream and the CBD Sport Cream.