DIS - Sources say Fox holders will own 25% of the new Disney stock - CNBC's Faber - Companies not planning management succession announcement as part of any deal announcement tomorrow
Gapping upIn reaction to strong earnings/guidance:
- MDB +1.6%, ARWR +1.4%, MDXG +1.2%.
M&A news:
- OSTK +2.9% (Overstock.com said to be exploring a sale, according to the FT)
Other news:
- DPW +37.9% (Digital Power Corporation launches new business division dedicated to the mining of cryptocurrencies)
- FNSR +21.7% (Finisar to receive $390 mln as part of Apple's advanced manufacturing fund)
- CLLS +12.0% (Cellectis presents preliminary results from two phase 1 studies of UCART19; first-in-human data demonstrated the safety and tolerability of UCART19)
- WDC +4.1% (Western Digital and Toshiba reach global settlement and agree to extend JV terms for flash memory collaboration; WDC provides updated guidance)
- EIX +1.5% (Edison pops higher on reports that Skriball fire caused by illegal camp fire)
Analyst comments:
- STAY +3.1% (Extended Stay America upgraded to Overweight from Neutral at JP Morgan)
- MS +1.1% (upgraded to Outperform at Keefe Bruyette after the close)
Early premarket gappers
Gapping up:
- DPW +27.4%, FNSR +21.6%, CLLS +12.4%, STRM +10.4%, WDC +3.3%, OSTK +3.3%, AGIO +3%, EIX +1%.
Gapping down:
- HMNY -16.7%, IRM -0.8%, NAT -15.5%, RIOT -13.1%, CIVI -7.1%, PTI -6.8%, PAY -6.3%, MDB -6%, FATE -4.8%, NTLA -3%, ARWR -2.8%, BLUE -1.8%, NBLX -1.2%, SHLD -1.1%.
Apple to invest $390 million in Finisar to ramp up chip production
(Reuters) - Apple Inc will give Finisar Corp $390 million to increase production of chips that power high-profile iPhone X features including Face ID, Animojis and portrait-mode photos.
Shares of Finisar, a Sunnyvale, California-based optical components maker, rose 14 percent to $22 in premarket trade on Wednesday.
The investment is Apple’s second from its $1 billion advanced manufacturing fund that seeks to foster innovation and create jobs, Apple said. The first investment was a $200 million infusion into Gorilla Glass maker Corning Inc in May.
Finisar will use the money to transform a previously closed 700,000-square-foot plant in Sherman, Texas to make high volumes of laser diodes called vertical-cavity surface-emitting lasers, or VCSELs.
In the fourth quarter of 2017, Apple said it would buy 10 times more VCSELs than were previously made worldwide over a similar time period.
The Sherman facility is expected to ship products starting in the second half of 2018.
Eli Lilly reaffirms FY17 guidance and sees FY18 EPS/revs in line
- Co reaffirms guidance for FY17 (Dec), sees EPS of $4.15-4.25 vs. $4.21 Capital IQ Consensus Estimate; sees FY17 (Dec) revs of $22.4-22.7 bln vs. $22.63 bln Capital IQ Consensus Estimate; reaffirms non-GAAP gross margin of ~76%
- Co issues in-line guidance for FY18 (Dec), sees EPS of $4.60-4.70 vs. $4.65 Capital IQ Consensus Estimate; sees FY18 (Dec) revs of $23.0-23.5 bln vs. $23.07 bln Capital IQ Consensus Estimate.
- 2018, the company is expecting continued pipeline progress, including U.S. regulatory action for baricitinib for the treatment of rheumatoid arthritis, galcanezumab for the treatment of migraine and a new indication for Verzenio in breast cancer, as well as the launch of a new indication for Taltz in psoriatic arthritis.
- "We are confident in our future growth prospects and have reaffirmed our expectation of least 5 percent average annual revenue growth from 2015 to 2020, on a constant currency basis. In addition, we expect operating margin as a percent of revenue to be at least 30 percent in 2020, excluding the effect of foreign exchange on international inventories sold."
Honeywell updates Q4 guidance, issues FY18 outlook ahead of investor conference call (153.74)
- Q4: Co now sees EPS of approximately $1.84 (Previously guided for $1.79-1.84) vs $1.83 Capital IQ Consensus Estimate, sees sales +9% (Previously guided for +5-7%) to ~$10.88 bln vs $10.54 bln Capital IQ Consensus Estimate, sees organic growth +7-8% (Previously guided for +4-6%, sees segment Margin Expansion Down ~(10) bps -- Flat (Previously guided for +30-50 bps)
- FY18: Co sees EPS of $7.55-7.80 vs $7.79 Capital IQ Consensus Estimate, sees organic sales growth of 2-4%, expects to grow segment margins by 30 to 60 basis points, sees FCF of $5.2-5.9 bln
Tired of Pricey FANGs? Try Shenzhen
For those willing to stomach a little political risk, a shift into Shenzhen now might prove rewarding
Fund managers love to moan about how pricey U.S. equities are, particularly the pointy-toothed FANGs (Facebook, Amazon, Netflix and Google) that have led this year’s bull market.
For those with access to Chinese markets through Hong Kong or otherwise, here’s a different idea: Try Shenzhen, where most of China’s tech and consumer heavyweights are listed.
China’s “old economy” has had its best year in ages in 2017, thanks to a big government-led stimulus launched two years ago when the real-estate market was on the brink of disaster. That has helped suck liquidity out of “new economy” stocks in Shenzhen, previously the darling of investors, and back into mostly state-owned financials and industrials listed in Shanghai. While China’s benchmark CSI 300 Index—dominated by Shanghai-listed companies—has just logged its best performance in years, up 22% in 2017, the Shenzhen index is down 4%.
While China’s benchmark CSI 300 Index—dominated by Shanghai-listed companies—has just logged its best performance in years, up 22% in 2017, the Shenzhen index is down 4% Photo: Zhengyi Xie/Cpressphoto /Zuma Press
In turn, Shenzhen has also started trading at a discount to the Nasdaq for the first time since 2014. Shenzhen stocks still aren’t cheap: The index as a whole is valued at 20 times expected earnings. But that is down from 26 times just a year ago—one of the few major global indexes to actually get cheaper this year. The Nasdaq’s price-to-expected-earnings ratio has risen to 23 from 20 over the same period.
Meanwhile, all that bubbly good feeling in China’s banking and steel sector is starting to look frayed around the edges. Real-estate sales are heading down, credit growth is slowing and industrial indicators are starting to droop again. It’s a good bet that by mid-2018, the profit outlook in steel and real estate, and asset quality at banks, will all start to look shakier.
At that point, it’s likely funds will start fleeing the real-estate market, commodities and old-economy equities, and retreat into Shenzhen’s tech and consumer plays.
Such a bet isn’t without risk—one reason tech plays in China are cheap at the moment is that regulators are keeping internet giants like Tencent and Sina on a tighter leash.
But for those willing to stomach a little political risk, a shift into Shenzhen now might prove rewarding—especially if higher U.S. interest rates next year start to take some of the edge off those FANGs.
Atos may have to increase offer for Gemalto; JPMorgan and Deutsche Bank advising target – report (translated)
13 DEC 2017
Shareholders in Netherlands-based digital security and services provider Gemalto [EPA:GTO] could want an increase in the EUR 46/shares offer submitted by Atos [EPA:ATO], a France-based information technology services company.
An unsourced report from French daily L’Agefi said that the offer values the target at 10 times 2018 EBITDA target, compared with a 2017 average of 18 times 2018 EBITDA target for the sector in Europe.
The report claimed that the Gemalto shareholders might see Atos' move as opportunistic, especially since shares in Gemalto plunged about 50% since the beginning of 2017 and the four profit warnings released by the target since October 2016.
Gemalto is assisted by JPMorgan and Deutsche Bank, the report noted.
The report referred to analysts at UBS who value the target at EUR 49 per shares; Analysts at CM-CIC said that other parties, such as France’s Ingenico [EPA:ING], could make a counter-offer for Gemalto.