>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance: LUV -5.5%, SHW -5.2%, INTC -3.3%, VMI -3.1%, KMI -2.8%, DNKN-2.5%, UNP -2.3%, MLNX -2.2%, DISH -1.9%, AXP -1.3%, AXP -1.3%, DHI -1.2%, ADPT -0.8%, DOV -0.8%

M&A news: CTO -2% (concludes review of strategic alternatives, did not receive any expressions of interest; also reported earnings)

Select Airline related names showing weakness after weak earnings by peers: RYAAY -2.6%, UAL -2%, DAL -1.8%,JBLU -1.5%, HA -1.1%

Other news:
  • OPTT -14.4% (following another day of huge gains -- up more than 70% yesterday)
  • BKEP -10.4% (commences 3 mln unit offering of common units representing limited partner interests of the Partnership
  • OPGN -8.1% (pulling back following strength yesterday attributed to M&A speculation
  • BDC -7.2% (prices 4.5 mln depositary shares at $100.00 per share)
  • UBA -5.4% (commences 2.75 mln common stock offering)
  • CTO -2% (Consolidated-Tomoka Land announces Board has 'not received any expressions of interest in acquiring the Company that contained an indication of value that would provide a meaningful premium for shareholders')
  • TSLA -1.8% (Elon Musk unveils 'Master Plan pt2', says major component can't be done well with Tesla and SolarCity (SCTY) as different companies)
  • SPU -1.8% ( SkyPeople International Holdings discloses 57.5% active stake, confirms stock purchase agreement announced 7/18 )
  • LPI -1.3% (Laredo Petroleum expects to report a loss on derivatives of ~$68.5 million, including ~$45.0 million net cash received on settlements of matured derivatives, net of deferred premiums paid)
  • HAWK -0.9% (intends to offer $425 million aggregate principal amount of convertible senior notes due 2022 through a private placement; to enter into an amended and restated credit agreement for a $700 mln credit facility)
Analyst comments: GHL -1.9% (downgraded to Underperform from Neutral at Credit Suisse)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance: SPKE +9.5%, (expects Q2 adjusted EBITDA of $10.0 -12.0 mln - far exceeding co's expectations), FNF +8.6%, URI +8.3%, ASPS +7.7%, QCOM +7.6%, TBI +7.3%, CAMT +7.3%, ECA +6.6%, VAC+6.6%, GM +6.4%, BIIB +5.7%, EBAY +5.1%, (also announces $2.5 bln buyback), PHM +4.1%, DPZ +4.1%, NURO+3.4%, IMAX +3.1%, HXL +2.9%, HBHC +2.2%, PPG +2.2%, NEM +2%, ADS +1.4%, CCK +1.2%, DWCH +1%, (reports Q3 results, initiates process to explore and evaluate a broad range of strategic alternatives), PKG +1%, SNA +1%

M&A news:
  • RLYP +58.6% (to be acquired by Galenica for $32 per share)
  • JOY +17.4% (to be acquired by Komatsu (KMTUY) for $28.30 per share)
Select metals/mining stocks trading higher: MT +3.1%, RIO +3%, AU +2.8%, AUY +2.8%, DRD +2.7%, BHP +2.5%,BBL +2.4%, ABX +1.8%, FCX +1.8%, GDX +1.2%, X +1.1%

Other news:
  • KNDI +5.7% (announces that Kandi Electric Vehicles Group Co plans to sell 1,500 electric vehicles to two cities in China)
  • BLDP +5.3% (signs follow-on technology solutions agreement with leading global automotive OEM )
  • ARAY +5% (announces preliminary results from phase II trial evaluating once-daily accelerated partial breast irradiation in patients treated with the TomoTherapy System)
  • ADXS +4.2% (announces Fast Track designation from the FDA for its lead immunotherapy candidate)
  • LGIH +4.1% (LGI Homes will replace Krispy Kreme Doughnuts in the S&P SmallCap 600 July 27 after the close )
  • VALE +1.2% (reaches 86.8 Mt of iron ore production in the second quarter of 2016, 9.3 Mt higher than in 1Q16)
Analyst comments:
  • NOK +0.5% (added to Conviction Buy List at Goldman)
  • AMZN +0.5% (target raised to $900 from $790 at Goldman)

(TechCrunch) Tesla and Uber have more in common than you might think

Elon Musk’s new master plan catapults Tesla into a new market; car-sharing.
While the idea of Tesla car-sharing seems new, it is not the first time the company’s cars, coupled with autonomous technology, have come up in discussions about the sharing economy.
Back in 2015, Steve Jurvetson, a partner at Uber investor DFJ, told an audience that Uber’s Travis Kalanick had indicated he would buy every Tesla car produced if they could be made autonomous by 2020.
These were the days when it appeared a Uber and Tesla partnership could be on the horizon. Musk himself paused long enough on an earnings call to raise suspicions when discussing the possibility of such a partnership.
These days, it seems that Uber has gone its own way in developing an autonomous car solution. And with today’s announcement from Musk, it appears Tesla is doing the same.
“You will also be able to add your car to the Tesla shared fleet just by tapping a button on the Tesla phone app and have it generate income for you while you’re at work or on vacation, significantly offsetting and at times potentially exceeding the monthly loan or lease cost,” said Musk in his post.
Companies like Uber and Lyft have more in common with Tesla than would appear at first glance. Uber specifically has been quite vocal about its long-term vision and its need for autonomous vehicles.
Both Uber and Tesla used an initial product or service to enter a market with serious barriers to entry. For Uber, ride-sharing required serious human capital and powerful regulatory influence. Tesla needed to build a mass-produced automobile from scratch.
Uber is still burning cash in China and Tesla still needs to follow through on its costly Gigafactory, but for the most part, both companies have been successful in what they initially set out to do. Both companies have an expensive obsession with driverless cars. Uber is pushing to hire top talent from Carnegie Mellon and other top universities to develop and test autonomous technologies.
This puts Uber on a collision course with Tesla, but this is not new. Tesla is only completing the puzzle by using car-sharing as a means to boost vehicle utilization rates. Both companies are betting on autonomous driving to reduce transportation costs.

Uber needs costs low to open up transportation access to groups outside their current market. This means increasing availability in low-density regions, and ultimately convincing everyday Americans to ditch car-ownership. Tesla needs to decrease the cost of driving to increase access to electric vehicles and ultimately reduce electricity needs and the overall carbon footprint.
The greatest benefits of the sharing economy have yet to be seen. On the surface, companies like Uber are providing income to previously unemployed segments of the middle class. In the future, when car-sharing becomes automated, the greatest market efficiencies will come from reduced transportation costs. Kalanick himself has noted in the past that the most expensive part of an Uber ride is the driver. Ride-sharing can only replace car-ownership if prices decrease further.
Uber doesn’t need autonomous cars in the same way it needs market share in China, but the space provides long-term sustainability for the company. Similarly, Tesla could sustain itself on its current trajectory, but Tesla can achieve long-term relevancy with such an endeavor. For both companies, autonomous driving presents another high-growth opportunity that will continue to attract and retain top talent.
The key for both companies will be ensuring that their core-businesses are not neglected by means of future investment. Musk made it clear in his plan that opportunities exist in the near-term to develop public-transportation and cargo solutions that will ease the company towards its longer term goals.
The collision between the two companies is still far off. Just because Uber and Tesla are riding the same trend, the contest is not a zero-sum game. As Google and others increase spending on autonomous driving, the entire ecosystem benefits. Keeping an eye on R&D spending overall will be quite introspective into the strategies of all companies in the space.
Tesla can compete. Winning, on the other hand, is a matter of hedging the right bets on what the future of transportation will look like. 20 years from now, it’s unlikely we will have an interest in outright purchasing an electric car or paying a hefty fee to be driven around in a gas guzzler.
We have reached out to both Uber and Lyft for comment and will update this post if we receive word from them.

>>> Marriot Vacations beats by $0.06, misses on revs; reaffirms FY16 EPS guidanc

Marriot Vacations beats by $0.06, misses on revs; reaffirms FY16 EPS guidance (68.46)
  • Reports Q2 (Jun) earnings of $1.08 per share, excluding non-recurring items, $0.06 better than the Capital IQ Consensus of $1.02; revenues rose 1.7% year/year to $429.95 mln vs the $438.3 mln Capital IQ Consensus.
  • Co reaffirms guidance for FY16, sees EPS of $4.43-4.78, excluding non-recurring items, vs. $4.51 Capital IQ Consensus Estimate. Adjusted EPS increased from the previous guidance of $4.31 to $4.66 due entirely to a reduction in shares outstanding.
  • Co reaffirmed FY16 adjusted EBITDA guidance of $261-276 mln.
  • "Our second quarter results, including contract sales, were solid and in line with our expectations...And even more importantly, contract sales growth gained momentum as we moved through the second half of the quarter. Additionally, tour activations for the second half of 2016 are substantially ahead of this time last year, and four of our six new sales centers are open and gaining momentum, giving us confidence that we will achieve our 2016 goals and are well positioned for solid growth in the years to come."

NY Post : ‘Wolf of Wall Street’ was financed with stolen money: feds

‘Wolf of Wall Street’ was financed with stolen money: feds

“The Wolf of Wall Street” didn’t just tell the story of a crooked stockbroker who scammed millions of dollars that he blew on drugs and hookers — the Leonardo DiCaprio movie was itself financed with stolen money, the feds charged Wednesday.

A civil suit filed by the US Justice Department demands all future profits, royalties and distribution proceeds from the Oscar-nomi­nated 2013 flick on the grounds that it was part of an international money-laundering scheme involving a development firm set up by the prime minister of Malaysia.

“This is a case where life imitated art,” said US Assistant Attorney General Leslie Caldwell.


In a series of interrelated complaints, the feds are seeking a total $1 billion in assets paid for with money allegedly stolen by corrupt Malaysian officials and their associates from 1Malaysia Development Berhad, also known as 1MDB.

The fund “was created to promote economic development . . . with the ultimate goal of improving the well-being of the Malaysian people,” but “unfortunately and tragically, a number of corrupt officials treated this public trust as a personal bank account,” US Attorney General Loretta Lynch said.

The assets include five swank Manhattan properties: penthouses in the Time Warner Center and Walker Tower, condos in the Park Laurel building and at 118 Greene St., and a stake in the Park Lane Hotel.

More than $100 million of the loot also allegedly went to produce “The Wolf of Wall Street,” which has raked in more than $392 million in ticket sales worldwide. It is director Martin Scor­sese’s highest-grossing film.

“Of course, neither 1MDB or the Malaysian people saw a penny of profit from that film or the other assets purchased with funds ­siphoned from 1MDB,” Caldwell said.

“Instead, that money went to relatives and associates of the corrupt officials of 1MDB and others.”

Caldwell said the suit targets only the movie’s future earnings because the feds aren’t “able to seize anything retroactively.”

“The Wolf of Wall Street” spent six years in development hell due to its salacious, R-rated subject matter before it was finally green-lighted by a virtually unknown production company, Red Granite Pictures, which footed almost all the costs, The Wall Street Journal reported.

The suit identifies infamous party animal Low Taek Jho — better known as “Jho Low” — as a key figure in the film’s funding, noting that he personally distributed more than $10 million for the project.

The Los Angeles federal court filing notes that Low got a full-screen “special thanks” in the closing credits and was among three people singled out as “collaborators” during DiCaprio’s acceptance speech when he won the 2014 Golden Globe Award for Best Actor in a Motion Picture.

DiCaprio also gave shoutouts to Riza Aziz, the stepson of Malaysian Prime Minister Najib Razak and a co-founder of Red Granite, and to Joey McFarland, Red Granite’s other co-founder.

The suit also alleges that DiCaprio — who is identified only as “a lead actor in ‘The Wolf of Wall Street’ ” but can be identified through the complaint’s description — went gambling with Low, Aziz and McFarland at The Venetian Las Vegas on July 15, 2012. The foursome had more than $1.15 million in 1MDB funds with which to gamble. It was ­deposited into Low’s account.

The suit says Red Granite bankrolled “The Wolf of Wall Street” with 1MDB funds funneled into a Swiss bank account held in the name of Good Star Limited.

Cash was then transferred into various accounts at City National Bank in Los Angeles and doled out to pay the film’s production costs.

“These funds are directly traceable to the $700 million wire transfer and $330 million wire transfers unlawfully diverted from 1MDB to the Good Star account,” the suit says.

Specific payments included 17 separate transfers, totaling $3.9 million, to the Scorsese-owned Sikelia Productions company, $48 million to an unidentified film-industry management firm and at least $4.1 million to various visual-effects companies.

About $2.5 million went to the Screen Actors Guild, and another $80,000 was paid to a charter-yacht company, the suit says.

One of the most memorable scenes in “The Wolf of Wall Street” features DiCaprio — portraying real-life stock fraudster Jordan Belfort — being questioned by FBI agents aboard a yacht docked off Battery Park City.

Sources told The Post that Low “lavished money” on DiCaprio. “He would give him half a million bucks to come to a Vegas party on a private plane and all the chips on the house. They also asked Scorsese, who turned them down,” the source said.

Lynch said more than $3 billion was scammed from 1MDB, but officials have so far been able to trace only $1 billion through American financial systems.

Reps for DiCaprio and Scorsese didn’t return requests for comment, but Red Granite issued a statement saying “none of the funding it received four years ago was in any way illegitimate and there is nothing in today’s civil lawsuit claiming that Red Granite knew otherwise.”

In addition to funding “The Wolf of Wall Street,” staggering amounts of stolen cash were spent on luxuries that the feds are seeking to have forfeited, including:

* A $5.5 million Vincent van Gogh drawing.
 * Two paintings by Claude Monet valued at $92.5 million.
* A $240 million stake in the Park Lane Hotel at 36 Central Park South.
* The $50.9 million penthouse at the Walker Tower in Chelsea.
* A $35 million Bombardier jet.
* The $44.8 million L’Ermitage hotel in Beverly Hills.
* A $30.5 million penthouse at the Time Warner Building at 80 Columbus Circle, which was bought sight unseen.

Starting in 2009, Low made headlines for spending millions in clubs with celebrities for whom he was footing the bill, including Lindsay Lohan, Paris Hilton, Jamie Foxx and DiCaprio, who accompanied him on yachts, jets, casinos, nightclubs and ski trips all over the world.

>>> Early premarket gappers

Early premarket gappers

Gapping up: RLYP +58.4%, JOY +17.4%, URI +8.8%, QCOM +8.7%, FNF +8.6%, TBI +7.3%, GM +6.4%, EBAY +6.2%, BIIB+5.2%, SPKE +5%, SPU +4.8%, BLDP +4.7%, CAMT +4.5%, LGIH +4.2%, PTC +3.8%, PHM +3.6%, BHP +3.1%, RIO+2.9%, MT +2.9%, IMAX +2.9%, HXL +2.9%, BBL +2.8%, DRD +2.7%, FFIV +2.6%, AU +2.3%, PPG +2.2%, DB +2%, ABX+1.9%, ING +1.8%, HLX +1.8%, NEM +1.8%, AUY +1.7%, CS +1.6%, JCI +1.5%, VALE +1.4%, GDX +1.3%, X +1.2%, CCK+1.2%, FCX +1.1%, DWCH +1%, ADPT +1%, ECA +1%, SNA +1%, MAT +0.8%

Gapping down: BKEP -9.7%, BDC -6.3%, UBA -5.7%, OPTT -5%, MLNX -3.4%, LUV -3.3%, SHW -3.2%, VMI -3.1%, DHI-2.9%, SCSS -2.6%, INTC -2.4%, KMI -2.4%, TSCO -2.3%, ASML -2.2%, CTO -2%, DISH -1.9%, LPI -1.3%, BUD -1.2%,FMSA -1%, AXP -1%, HAWK -0.9%, FTI -0.9%, TSLA -0.8%

>>> Manpower beats by $0.08, reports revs in-line; guides Q3 EPS in-line

Manpower beats by $0.08, reports revs in-line; guides Q3 EPS in-line
  • Reports Q2 (Jun) earnings of $1.60 per share, excluding non-recurring items, $0.08 better than the Capital IQ Consensus of $1.52; revenues rose 3.3% year/year to $5.02 bln vs the $5.06 bln Capital IQ Consensus.
  • Co issues in-line guidance for Q3, sees EPS of $1.66-1.74, excluding non-recurring items, vs. $1.71 Capital IQ Consensus Estimate

>>> Johnson Controls beats by $0.04, misses on revs; guides Q4 EPS in-line

Johnson Controls beats by $0.04, misses on revs; guides Q4 EPS in-line
  • Reports Q3 (Jun) earnings of $1.07 per share, excluding non-recurring items, $0.04 better than the Capital IQ Consensus of $1.03; revenues fell 1.0% year/year to $9.52 bln vs the $9.63 bln Capital IQ Consensus.
  • Co issues in-line guidance for Q4, sees EPS of $1.17-1.20, excluding non-recurring items, vs. $1.19 Capital IQ Consensus Estimate.
  • Orders in the quarter, excluding M&A and adjusted for foreign exchange, were 5 percent higher year-over-year driven by Systems and Services North America up 3 percent, Products North America up 8 percent and Asia up 6 percent. Backlog at the end of the quarter improved to $4.8 billion, an increase of 2 percent from the prior year, excluding the impact of foreign exchange