(B.Riley FBR) Regal Entertainment downgraded to Neutral , tgt lowered to $23

Regal Entertainment downgraded to Neutral tgt lowered to $23
B. Riley FBR, Inc. downgrades RGC to Neutral from Buy and lowers their tgt to $23 from $24.75 Neutral as the 45-day "go shop" period has failed to generate any offers after 28 days other than that from Cineworld Group. Firm believes that additional offers are increasingly unlikely at this point (following new details provided in the information statement filed on 12/22/17). Therefore, with 1) a potential annualized return of less than 6.0% to the $23.22 in total proceeds from the $23.00 per share cash offer plus the final regular $0.22 per share dividend; and 2) the fact there will always be some level of risk around the shareholder vote, financing commitments, or regulatory approvals (which we view as minor risks nevertheless), they believe risk/reward has eroded, especially with RGC shares now above $23.00. On that note, they see a better opportunity to reallocate funds into their other pure-play Buy-rated exhibitors under coverage: AMC Entertainment (AMC; Buy; $30.00 PT) and Cinemark Holdings (CNK; Buy; $47.00 PT) as well as the leading global large-format technology provider IMAX Corporation (IMAX; Buy; $35.00 PT).

FT : Approach to investing needs rethink to create tech miracles

Approach to investing needs rethink to create tech miracles
State funds and investors are key to promoting innovation to tackle poverty

Innovation and technology are key to lifting billions of people out of poverty and to solving the existential challenges facing our world. For the past decade, large investments and innovation in renewables and electric vehicles by the state and private companies are paving the way for a much less polluted world and the last age of oil. Technology creation and innovation such as artificial intelligence, big data and robotics are key for sustained growth — and the world needs more innovation.

For the past 15 years, we have seen an impressive rise in technologies created in emerging Asian economies. Measured by the number of patents granted in the US, the “Asian Miracles” are already contributing more than the major European economies to global technological progress. China’s patents granted in the US went from about 100 in 2000 to over 8,000 in 2015, more than the UK or France (about 6,500 in 2015).

Such an advance in technology creation is of benefit to all economies, encouraging innovation and competition, as well as promoting growth and standards of living. In other words, emerging Asia no longer fits the standard growth storyline of FDI inflows and low costs of production. It is also becoming the region of dynamism, entrepreneurship and ingenuity.

In financing innovation, angel investors, venture capitalists and private equity firms sift through new technologies and young companies, invest in them and attempt to create value for both investors and society at large. Silicon Valley is celebrated as the epicentre of innovation and risk-taking but perhaps even more so is Boston, where difficult and risky R&D in biopharma takes place.

In 2015, less than 20 per cent of total US venture capital went to biopharma, compared with about 45 per cent in internet companies, mostly in California. About 60 per cent of biopharma start-ups are led by PhDs bringing cutting-edge science to the market compared with about 6 per cent for internet start-ups. The total US venture capital funding of about $50bn-$60bn is dwarfed by the flows in financial markets while risky ventures in key fields suffer from a lack of early-stage financing.

When the state intervenes, the usual suspect of failed support (for instance, for the US solar producer Solyndra) springs out but the support received by Tesla from the same programme is less publicised.


To promote innovation, we need both the state and the market. Mariana Mazzucato has argued in her bestseller The Entrepreneurial State that most of the cutting-edge technologies that the iPhone has were funded by public programmes. Of course, Apple’s role should not be underestimated. We need more companies putting technologies together to create path-breaking products and services. I believe we will see more of these groups coming from Asia.

In fact, China’s recent initiative “Made in China 2025” in promoting the creation of key technologies should encourage Chinese companies and entrepreneurs to innovate. Technology creation by domestic companies is key to escaping the middle-income trap as argued in the IMF working paper The Leap of the Tiger by Reda Cherif and Fuad Hasanov.

The continued focus of the Asian economies on innovation and technology creation is not only beneficial to society but also to global markets and investors. As more innovative companies come out from Asia, more competition and innovation will provide opportunities for investors. We see many large hedge funds active globally but, unfortunately, we do not see as many funds playing the role of a big angel investor or a venture capitalist investing in path-breaking innovation from all over the world.

The huge bets on dubious financial instruments that led to the global financial crisis should make us question our approach to investing. Early investment in innovative companies stemming from hard science may not be such a risky proposition after all. If the market does not provide enough support to young innovative companies, the state should provide support as it does in most advanced economies. Perhaps the creation of public venture capital funds would encourage the market to create more private funds.

Joseph Stiglitz and Bruce Greenwald in their book Creating a Learning Society argue that the gap in knowledge differentiates developing from advanced economies. Technology and innovation, including in developing economies, can create miracles. The state and the market are the two wings of the same bird and it takes both to fly.

>>> Grupo Libra attracts interest from CMA CGM

Grupo Libra attracts interest from CMA CGM - report (translated)
02 JAN 2018
Grupo Libra, a closely held Brazilian port terminal operator, is has been targeted by French peer CMA CGM, Veja reported, without citing sources.
The Portuguese-language article did not provide further details on the matter.
The Brazilian entity had BRL 1bn (USD 301.8m) net revenues in 2014.

>>> Sector Summary: Consumer Staples Year In Review

Sector Summary: Consumer Staples Year In Review
The Consumer Staples sector has under-performed the S&P 500 in 2017. The Consumer Staples Sector SPDR ETF (XLP) has increased 10.2% YTD vs. the S&P 500 price return of 19.8%.
The sector's subpar performance is related in part to the continuation of the bull market, which is running into its ninth year, and investors' embrace of growth stocks.
The sector saw some notable buying interest in November, though, as tax reform optimism promoted a sector rotation trade into sectors that had been trailing the broader market and were seen offering good potential in 2018 for positive earnings surprises given the cut to the corporate tax rate.
Consumer Staples stocks typically exhibit relative strength in periods of slower economic growth, and/or stock market distress, as investors consider them relative safe havens due to their steady (and generally low) earnings growth rates and dependable cash-flow generation that afford the payment of secure dividends.
The tables below highlight the best-performing stocks in the S&P 500 Consumer Staples sector as well as the worst-performing stocks in the sector. In addition, we feature the price returns for many of the sector's most notable stocks.
(Note: prices as of December 26)
Winners: EL +71%, BF.B +52%, STZ +46%, WMT +44%, TSN +36%, CCE +28%, CLX +26%, COST +26, PM +23%, PEP +17%
Losers: AVP -55%, DF -46%, SVU -33%, CPB -20%, KR -19%, TAP -16%, ADM -12%, K -8%, CVS -7%, GIS -4%, SJM -2%
Notables: CL +15%, KO +11%, HSY +11%, SYY +10%, PG +10%, MKC +9%, MO +7%, HRL +6%, KMB +6%, DPS +6%, CAG -4%, GIS -3%
A Look into 2018:
An accelerating economy is a positive for the consumer staples companies as it creates an opportunity to drive volume growth and possibly to restore some pricing power that should translate into better earnings growth potential. That doesn't mean, however, that it's the best thing for consumer staples stocks, which often lag the stocks of faster-growing companies during periods of economic, and stock market, strength.
The latter point notwithstanding, the sector could garner some favor in a continuing bull market since it holds potential for increased M&A activity as companies seek to increase economies of scale and grow market share in a very competitive arena that necessitates efficient operating models.
Separately, the sector will hold some defensive-oriented appeal in the event of a market correction and/or a slowdown in economic growth.
Key sector risks: Reduced pricing power; protectionist policies that curb sales potential of multinational corporations; a strengthening dollar; increased use of generic/private label products; Walmart and Amazon.com battling for market share in the grocery/consumer staples space

>>> 2017 Market & Sector Performance and Trends...

2017 Market & Sector Performance and Trends...
2017 ends on a strong note as the Major Indices finish with above-average returns for the year. Leading the way higher was the Nasdaq, followed by the Dow Jones, S&P, Midcaps, and finally Small Caps. Sector rotation played a big role throughout this multi-year bull cycle that helped propel the indices repeatedly into fresh new high territory.
As we head into 2018, the uptrends remain well intact on multiple timeframes, so the burden of proof lies on the bears (sellers) once again. From a swing trading perspective, the Monthly and Weekly charts, combined with some intermediate and short-term moving averages (50-day and 20-day), should continue to serve as an excellent guide for trading with the trend and revealing any potential weakness.
The table below shows the Relative Performance VS. the S&P for the main 9 sectors... The Technology sector (XLK) dominated in 2017 while the Energy complex (XLE) lagged significantly relative to the S&P performance.
The 9 charts below show each sector and their 1-year price action for 2017... Traders should continue to ride the current momentum/trends until proven otherwise. Caution is warranted with Utilities (XLU) as they showed some aggressive distributions into year-end.

>>> Sector Summary: Healthcare Year In Review

Sector Summary: Healthcare Year In Review
The Healthcare sector (XLV) is up +20.5% for the year, narrowly outperforming the S&P 500 +19.6%.
Biotech stocks surged to challenge the highs from 2015 as fears over drug price scrutiny subsided. The SPDR S&P Biotech ETF (XBI) is up 45% year-to-date. M&A was relatively slow in the face of uncertainty over tax reform.
Large-cap bio-pharma stocks traded more in-line with the broader market -- the iShares Nasdaq Biotechnology ETF (IBB) is up +21.6% year-to-date as large-cap biopharma saw slowing growth and generic drug makers dealt with price competition.
Gilead (GILD) made its long-awaited large acquisition by purchasing next generation immune-oncology (I-O) CAR-T company Kite Pharma. While immune-oncology is making great progress, it is an increasingly crowded space. Smaller biotech companies continue pair their therapies with I-O checkpoint inhibitor franchises from Bristol-Myers (BMY), Merck (MRK) and to a lesser extent AstraZeneca (AZN).
Gene therapy stocks have grown in popularity as they set the pace for innovation in biotech (SGMO +469%, ALNY +243% +QURE 242%, ABEO +232% BLUE +192%, CYRX +176%, AVXS 132%, +EDIT 84%).
Managed Healthcare stocks were strong -- all were up at least 20%, led by Centene (CNC, +82%), Anthem (ANTM, +57%), and Cigna (CI, +52%). Pharmacy CVS (CVS) is trying to acquire Aetna (AET) in a vertical deal after managed care M&A was shot down by regulators earlier in the year.
Hospital stocks were a laggard on disappointing results while the GOP tried to repeal The Affordable Car Act. Drug distributors underperoformed while the role of these intermediates comes in to question as drug prices continue to rise.
Below we highlight the best-performing stocks in the sector as well as the worst-performing stocks in the sector. In addition, we feature the price returns for gains outside the S&P 500 and most notable stocks.
S&P 500 Gainers: ALGN +143%, VRTX +97%, CNC +83%, ISRG +75%, ILMN +69%, ANTM +61%, CI +57%, ABBV +57%, ABT +49%, BAX +48%
S&P 500 Losers: EVHC -48%, AGN -20%, CAH -12%, SRCL -11%, PDCO -11%, CELG -7%, HSIC -6%, INCY -5%, MRK -5%, ALXN -4%
Big winners outside the S&P 500: SGMO +469%, NKTR +381%, DVAX +386%, SPPI +344%, EXAS +297%, FMI +284%, ALNY +243%, MYOK +227%, PBYI +223%, SAGE +222%, AXGN +216%
Notables: BIIB +22%, AMGN +20%, LLY +16%, NVS +15%, PFE +12%, SNY +7%, BMY +6%, REGN +5%, GILD +2%, MRK -4%
A look to 2018:
Biotech will continue to set the pace for innovative new medicines as gene therapy and immune-oncology advances.
M&A is expected to pick up in the pharmaceutical and biotechnology stocks. The reduced US corporate tax rate will put the days of inversion to rest (US companies acquiring overseas firms to re-domicile in lower tax jurisdictions). What's more, large cap biopharma is flush with cash.
Sector Risks: Drug price scrutiny remains a potential risk.

>>> Mosaic confirms modifications to pending Vale (VALE) fertilizantes transacti

Mosaic confirms modifications to pending Vale (VALE) fertilizantes transaction; Reduction in the purchase price consideration to $1.15 billion in cash and 34.2 million shares of MOS common stock. (25.66)
  • Co announced modifications to the definitive agreement with Vale S.A., including reduced consideration for the acquisition of Vale Fertilizantes. The changes include:
    • A reduction in the purchase price consideration to $1.15 billion in cash and 34.2 million shares of The Mosaic Company common stock.
    • Vale S.A. will retain equity ownership in the TIPLAM port and Mosaic will continue to have the right to use the TIPLAM port facility in accordance with commercial arrangements entered into between the parties.

>>> M&S sells retail business in Hong Kong and Macau to Al-Futtaim

>>> M&S sells retail business in Hong Kong and Macau to Al-Futtaim

Marks & Spencer [LON:MKS], the UK-based food and clothing retailer, announced on Tuesday that it has sold its retail business in Hong Kong and Macau to its franchise partner Al-Futtaim, a Dubai, UAE-based conglomerate.
The transaction follows M&S’s strategic review of its international business in November 2016 in which it proposed to focus more on its franchise and joint venture partnerships and operate with fewer wholly owned markets.
Following the purchase of 27 Marks & Spencer stores in Hong Kong and Macau, Al-Futtaim now operates 72 Marks & Spencer stores across 11 markets in Asia and the Middle East.
M&S has a market cap of GBP 5.1bn.

Press releases:
Marks & Spencer (M&S) has today confirmed the sale and franchise of its retail business in Hong Kong and Macau to its long-established franchise partner Al-Futtaim. The sale, which completed on 30 December, sees Al-Futtaim become the new sole franchisee for M&S in Hong Kong and Macau.
Al-Futtaim has worked in partnership with M&S since 1998 when it opened Dubai’s first M&S store. Following the purchase of 27 Marks & Spencer stores in Hong Kong and Macau, Al-Futtaim now operates 72 Marks & Spencer stores across 11 markets in Asia and the Middle East.
Paul Friston, Marks & Spencer’s International Director, said: “We have substantially reshaped our International business, which has improved profitability and positioned us for growth. As one of the world’s leading retail operators, with strong logistics capabilities and local expertise, Al-Futtaim is the ideal partner for us to develop and grow our business in Hong Kong and Macau.”
Stephen Rayfield, Vice President M&S and Sports & Lifestyle Division at Al-Futtaim said: “We are delighted to strengthen our long-term partnership with M&S and expand Al-Futtaim’s international footprint to Hong Kong and Macau. Al-Futtaim looks forward to building on our solid foundations as we continue to enrich our customers’ lives and aspirations through the provision of quality products and services in Hong Kong and Macau.”
The sale follows M&S’s strategic review of its International business in November 2016, where M&S proposed to have a greater focus on its established franchise and joint venture partnerships and operate with fewer wholly-owned markets.