>>> Brokers Upgrades & Downgrades - 27th of January 2015

>>> Up
*ASHMORE GROUP RAISED TO BUY VS HOLD AT BERENBERG
*AXA RAISED TO OVERWEIGHT VS UNDERWEIGHT AT JPMORGAN
*DEUTSCHE EUROSHOP RAISED TO OVERWEIGHT VS NEUTRAL AT HSBC
*GIVAUDAN RAISED TO NEUTRAL VS SELL AT GOLDMAN
*K+S RAISED TO NEUTRAL VS UNDERPERFORM AT BOFAML
*K+S RAISED TO NEUTRAL VS SELL AT UBS
*LINDE RAISED TO BUY VS NEUTRAL AT BOFAML
*NORDEA BANK RAISED TO OUTPERFORM AT MACQUARIE
*NORILSK NICKEL RAISED TO BUY VS NEUTRAL AT UBS
*PEUGEOT ADDED TO CONVICTION BUY LIST AT GOLDMAN
*PEUGEOT RAISED TO BUY VS NEUTRAL AT CITI
*SGS RAISED TO NEUTRAL VS UNDERPERFORM AT CREDIT SUISSE
*STMICROELECTRONICS RAISED TO BUY VS UNDERPERFORM AT BOFAML
*TESCO RAISED TO HOLD VS SELL AT SOCGEN

>>> Down
*ALLIANZ CUT TO NEUTRAL VS OVERWEIGHT AT JPMORGAN
*ARKEMA CUT TO SELL VS NEUTRAL AT GOLDMAN
*BMW CUT TO SELL VS NEUTRAL AT GOLDMAN
*CONTINENTAL CUT TO NEUTRAL VS BUY AT GOLDMAN
*CREDIT SUISSE CUT TO HOLD VS BUY AT JEFFERIES
*DIXONS CARPHONE CUT TO UNDERWEIGHT AT MORGAN STANLEY
*GAM HOLDING CUT TO NEUTRAL VS OUTPERFORM AT CREDIT SUISSE
*HSBC CUT TO HOLD VS ADD AT INVESTEC
*HUNTING CUT TO NEUTRAL VS OVERWEIGHT AT HSBC
*ICADE CUT TO NEUTRAL VS OVERWEIGHT AT HSBC
*JULIUS BAER CUT TO NEUTRAL VS OUTPERFORM AT CREDIT SUISSE
*ROYAL MAIL CUT TO UNDERPERFORM AT RBC CAPITAL
*SCHWEITER TECHNOLOGIES CUT TO NEUTRAL VS BUY AT UBS
*SEB CUT TO NEUTRAL AT MACQUARIE

>>> PT Change


>>> Initiation
*ALROSA RESUMED BUY AT UBS, PT RUB95
*DRAX RATED NEUTRAL AT JPMORGAN; WAS NOT RATED
*IMMOFINANZ RATED NEW EQUALWEIGHT AT BARCLAYS, PT EU2.39

>>> Call
>> Stock
*DAIMLER EXITS GOLDMAN CONVICTION BUY LIST, STAYS BUY
*PEUGEOT ADDED TO CONVICTION BUY LIST AT GOLDMAN

>>> US After Hours Summary: GIGA +2.6%, SHBI +1.4%, ASH +0.7%, MSTR -1

after Hours Summary: GIGA +2.6%, SHBI +1.4%, ASH +0.7%, MSTR -12.1%, PKG -7.1%, MSFT -4.3% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: GIGA +2.6%, SHBI +1.4%, ASH +0.7%, WAT +0.4%

Companies trading higher in after hours in reaction to news: EROC +7.8% (provided update on Regency unit sale and Eagle Rock repurchase program: co has sold ~3.3 mln Regency Energy Partners units and has repurchased ~8.5 mln shares as of January 23, 2015); APAGF +0.4% (announced that its shareholders approved the proposal to adopt the previously announced merger agreement pursuant to which Pluspetrol Resources Corporation will acquire Apco)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: MSTR -12.1%, PKG -7.1%, SANM -5.2%, RMBS -4.6%, MSFT -4.3%, PLT -4.1%, UTX -2.2%, ZION -2.1%, SIMO -1.4%, CR -0.5%, SGB -0.5%, TXN -0.4%

Companies trading lower in after hours in reaction to news: JOE -9.1% (disclosed that it received a written 'Wells Notice' on Jan 20 2015), NVCN -1.6% (announced proposed public offering of 8 mln common shares), EPRS -1.1% (commenced an underwritten public offering of shares of common stock

>>> Asian Update

Asian Mid-session Update: PBoC continues to inject liquidity; Microsoft falls on weak outlook

***Economic Data***
- (CN) CHINA DEC CONFERENCE BOARD LEADING ECONOMIC INDEX M/M: 1.1% V 0.8% PRIOR
- (CN) CHINA DEC INDUSTRIAL PROFITS Y/Y: -8.0% V -4.2% PRIOR
- (AU) AUSTRALIA DEC NAB BUSINESS CONFIDENCE: 2 V 1 PRIOR; CONDITIONS: 4 V 5 PRIOR
- (JP) JAPAN DEC PPI SERVICES Y/Y: 3.6% V 3.5%E
- (KR) SOUTH KOREA JAN CONSUMER CONFIDENCE: 102 V 101 PRIOR; First rise in 4 months
- (KR) South Korea Dec final Department Store Sales y/y: -0.9% vs -6.5% prior; Discount store sales y/y: -3.8% v -4.7% prior

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 +1.3%, S&P/ASX +0.5%, Kospi +0.3%, Shanghai Composite -0.4%, Hang Seng -0.4%, Mar S&P500 flat at 2,053

***Commodities/Fixed Income***
- Feb gold -0.2% at $1,277, Mar crude oil flat at $45.25/brl, Mar copper -0.7% at $2.52/lb
- GLD: SPDR Gold Trust ETF daily holdings rise 1.7 tonnes to 743.4 tonnes
- (CN) PBoC to inject CNY30B in 7-day reverse repos and CNY30B in 28-day reverse repos (2nd consecutive injection, largest injection since Jan 27th, 2014)

***Market Focal Points/FX***
- China markets are marginally lower, even as PBoC decided to inject liquidity for the 2nd consecutive time, opting to follow last week's CNY50B 7-day reverse repo operation with a combined CNY60B in 7-day and 24-day tools. Recall last week, Chinese officials stated the operations are designed to address anticipated cash squeeze going into the Lunar New Year holiday. Further economic data from the mainland have also been underwhelming. Industrial profits declines accelerated to -8% from -4.2% prior and 2014 growth was just 3.3% - below 5.3% YTD increase in November. Speaking after the release, China vice fin min said industrial operation is within reasonable range, though economy is faced with downward pressure amid "new normal" conditions. December Conf Board leading index growth rose from the prior month, but resident economist said "current economic activity picked up in December on the back of strong consumption", adding "expectations and real estate remaining are subdued, suggesting weak economic growth in Q1 2015."

- USD/JPY is the largest mover among the dollar majors in an otherwise quiet FX session, falling about 50pips toward 118.10. The bulk of the plunge was attributed to comments from Econ Min Amari, who said neither overly weak nor strong Yen would be suitable. Amari also stated that recent fall in oil prices is having a significant impact on CPI and would likely push back timing of achieving 2% inflation.

- Australia NAB business confidence rose a point but conditions were down a point. NAB chief economist pointed to falling commodity prices undercutting mining confidence, though lower oil prices are boosting optimism among transport/utilities firms. AUD/USD hit session lows on the release near $0.79, but subsequently recovered toward $0.7940 in the afternoon trade.

- Microsoft was a notable decliner among tech giants reporting quarterly results, with sales slowing y/y in Licensing, Gaming, and Devices segments. MSFT made new lows afterhours following cautious conference call commentary, as management noted strong USD is impacting its outlook in addition to soft operating environment leading to y/y sales declines in China, Russia, and Japan markets.

***Equities***
US markets/ADRs:
- TXN: Reports Q4 $0.69 (adj) v $0.69e, R$3.27B v $3.27Be; +0.2% afterhours
- UTX: Reports Q4 $1.62 v $1.61e, R$17.0B v $17.1Be; -1.7% afterhours
- RMBS: Reports Q4 $0.14 v $0.06e, R$72M v $72.3Me; Approves 20M share buyback program (17% of shares outstanding); -2.9% afterhours
- MSFT: Reports Q2 $0.71 v $0.70e, R$26.5B v $26.1Be; Exec: Expects y/y Rev declines in China, Russia, Japan; Stronger USD to hurt forecast - conf call; -4.3% afterhours

Notable movers by sector:
- Consumer Discretionary: Alibaba Pictures Group 1060.HK +7.0% (FY14 guidance)
- Consumer staples: Biostime International 1112.HK +1.9% (positive update on gross margin)
- Materials: Lynas Corp LYC.AU -11.3% (Q2 results); Silver Lake Resources SLR.AU -18.3% (Q4 sales results); Marubeni Corp 8002.JP -1.3% (cuts FY15 guidance)
- Energy: Horizon Oil Ltd HZN.AU +4.0% (Q2 production results)
- Industrials: China State Construction 601668.CN +1.9% (awarded contract); Great Wall Motors 2333.HK +3.8% (FY14 results)
- Utilities: Huadian International 1071.HK +4.8% (FY14 guidance)

>>> US Close Dow +0,03%S&P+0,26% Nasdaq +0,29% Russell +0,99%

Closing Market Summary: Energy Sector Paces Quiet Advance

The stock market began the new week on a quiet note with the Dow (unch), Nasdaq (+0.3%), and S&P 500 (+0.3%) settling near their flat lines. The small-cap Russell 2000 (+1.0%) outperformed, but the action took place against the backdrop of anemic trading volume as the East Coast braced for Winter Storm Juno.

Because of the incoming storm, a State of Emergency was already declared in Connecticut, New York, New Jersey, and Massachusetts, while the New York Stock Exchange announced plans to open and operate as usual on Tuesday. The NYSE operated as usual today, but that did not stop some participants from sitting the session out. Intraday volume was light, but a surge in late-afternoon activity brought the final tally (780 million) relatively close to the 50-day average (803 million).

The intraday lack of trading activity masked the fact that the weekend featured an important election in Greece. As expected, the anti-bailout Syriza party came away victorious, and despite failing to secure absolute majority, the party was able to form a coalition with Independent Greeks—a party that also opposes EU bailouts. So far, Syriza officials have been very careful when discussing the future of Greece with Yanis Varoufakis, who is expected to be named finance minister, saying a euro exit is not in the plans and that talks of a ‘Grexit' should not be sensationalized.

Equity futures retreated at the Sunday open while the euro tested the 1.1100 level before bouncing into the 1.1250 area where it spent the bulk of the day. Similarly, equity futures erased the bulk of their losses ahead of the cash open.

The S&P 500 dipped below its 50-day moving average (2,047) in the early going, but the index found itself back above that level shortly thereafter. The S&P 500 returned to its flat line by 11:00 ET and traded within six points of that level for the remainder of the session.

Five of ten sectors registered gains with energy (+1.4%) holding the lead throughout the day. The sector narrowed its January decline to 1.8% while crude oil fell 1.0% to $45.12/bbl. Crude traded higher intraday after OPEC secretary general said prices could reach $200/bbl if producers choose not to increase supply, but selling into the pit close pressured the energy component into negative territory.

Elsewhere among cyclical sectors, financials (+0.5%) and consumer discretionary (+0.6%) outperformed while technology (-0.4%) struggled throughout the day. Notably, the discretionary sector received support from homebuilders after D.R. Horton (DHI 24.38, +1.28) reported better than expected results. The stock surged 5.5% while the iShares Dow Jones US Home Construction ETF (ITB 25.34, +0.52) gained 2.1%.

It wasn't all sunshine for discretionary shares as Mattel (MAT 26.64, -1.40) lost 5.0% after issuing cautious guidance and announcing the resignation of its Chief Executive Officer.

Also of note, the technology sector spent the day behind other groups due to relative weakness among heavily-weighted components like Google (GOOGL 536.72, -5.23), Oracle (ORCL 43.90, -0.29), Intel (INTC 35.80, -0.64), and Microsoft (MSFT 47.01, -0.17).

Over on the countercyclical side, health care (+0.5%) ended in the green while consumer staples (unch), telecom services (-0.4%), and utilities (unch) lagged throughout the session.

Treasuries registered modest losses with the 10-yr yield climbing two basis points to 1.82%.

Tomorrow, Durable Orders for December (consensus 0.5%) will be reported at 8:30 ET while the November Case-Shiller 20-city Index (consensus 4.3%) will be released at 9:00 ET. The Consumer Confidence report for January (consensus 96.0) will cross at 10:00 ET, alongside New Home Sales for December (consensus 450,000).
  • Nasdaq Composite +0.8% YTD 
  • S&P 500 -0.1% YTD 
  • Russell 2000 -0.3% YTD 
  • Dow Jones Industrial Average -0.8% YTD

>>> Microsoft reports EPS in-line, revs in-line



From: thechek@mac.com At: Jan 26 2015 22:20:45
To: LAURENT CHEKROUN (MAKOR SECURITIES LLP)
Subject: Fwd:>>> Microsoft reports EPS in-line, revs in-line
Microsoft reports EPS in-line, revs in-line 
Reports Q2 (Dec) GAAP earnings of $0.71 per share, in-line with the Capital IQ Consensus of $0.71; revenues rose 8.0% year/year to $26.47 bln vs the $26.27 bln consensus. EPS include $0.06 in unfavorable items. 
  • Devices and Consumer revenue grew 8% to $12.9 billion, with the following business highlights:
    • Surface revenue of $1.1 billion, up 24%, driven by Surface Pro 3 and accessories
    • Office 365 Home and Personal subscribers increased to over 9.2 million, up 30% sequentially over prior quarter
    • Search advertising revenue grew 23%, with Bing U.S. market share at 19.7%, up 150 basis points over prior year
    • Xbox console sales totaled 6.6 million units, with strong holiday season performance
    • Phone Hardware revenue of $2.3 billion, with 10.5 million Lumia units sold driven by growth in affordable smartphones
    • Windows OEM Pro revenue declined 13%; revenue was impacted by the business PC market and Pro mix returning to pre-Windows XP end of support levels and by new lower-priced licenses for devices sold to academic customers
    • Windows OEM non-Pro revenue declined 13%, with license growth from opening price point devices
  • Commercial revenue grew 5% to $13.3 billion, with the following business highlights:
    • Commercial cloud revenue grew 114% driven by Office 365, Azure and Dynamic CRM Online, and is now on an annualized revenue run rate of $5.5 billion
    • Office Commercial products and services revenue declined 1%; transactional revenue was impacted by the continued transition to Office 365 and declines in commercial PCs following the XP refresh cycle
    • Server products and services revenue grew 9%, with double-digit growth of SQL Server and System Center
    • Windows volume licensing revenue increased by 3%, with annuity revenue growth partially offset by declining transactional revenue.
  • Co also announced its intention to complete the existing $40 bln share repurchase authorization by Dec 31, 2016.

>>> Plantronics misses by $0.02, beats on revs; guides Q4 EPS below consensus, r

Plantronics misses by $0.02, beats on revs; guides Q4 EPS below consensus, revs below consensus  

Reports Q3 (Dec) earnings of $0.79 per share, excluding non-recurring items, $0.02 worse than the Capital IQ Consensus Estimate of $0.81; revenues rose 9.0% year/year to $231.8 mln vs the $225.65 mln consensus. Co issues downside guidance for Q4, sees EPS of $0.67-0.75, excluding non-recurring items, vs. $0.79 Capital IQ Consensus Estimate; sees Q4 revs of $205-215 mln vs. $224.93 mln Capital IQ Consensus Estimate.

>>> Finamore 1925 seeks private equity funding to fuel expansion

Finamore 1925 seeks private equity funding to fuel expansion 

Finamore 1925, a privately held Italian shirt maker, is seeking private equity investment in an effort to accelerate its expansion plans, said Simone Finamore, a board member and the company's sales director. Management is open to approaches directly from interested parties, as well as from advisors with potential investors.

Established in Naples in 1925 by Finamore's great grandmother, Vincenza Finamore, the company is wholly controlled by the founding family. The company is now managed by the fourth generation, Finamore said, explaining that his siblings Paolo, Andrea and Annamaria are running the business respectively as product manager, CFO and retail manager.

Financially, the company is growing year over year, he said. In 2014, the group generated a turnover of EUR 6m, up from EUR 5.4m of the previous year. For this year, Finamore is predicting a rise in sales of around 10% due to the company's business developments in Korea and its entry into Turkey.

Finamore 1925 gets most of its earnings through exports, which accounted for the 90% of the company's sales last year, Finamore explained. He pointed to Japan, Korea, all of Europe and New Zealand as the company's key markets.

In order to increase its sales abroad, the family's owners would be interested in approaches from private equity firms, he said. Suitable candidates would have extensive expertise in the retail industry, Finamore said, noting an investor with a retail background could help speed up the company’s internationalization.

The company has received approaches from interested parties in the past, Finamore said, but a deal has never materialized. Strategic bidders would not be ideal, he added, noting that the company is developed enough to be competitive in the fashion industry and to update its collections.

The owners will look only consider offers for a minority stake, with 49% the maximum, the executive said, adding that the family would like to remain involved in the business. Finamore did not spell out the company's valuation and how much they intend to raise from this transaction; however, he noted that management would like to share and implement its business plan together with the investor.

Proceeds from the stake sale would be used to expand into Latin America, China and the Middle East, the executive said. He pointed to the high regard for Italian brands in these countries, especially for products with a strong "Made in Italy" character. Management intends to extend its retail network into these target countries, he said, and taking on a financial backer with the relevant contacts in the retail industry would be key to accelerating this project.

The company is headquartered in Naples. It has 60 employees.

>>> Elliott Management discloses 8% stake in Informatica; pushes for sale to pri

Elliott Management discloses 8% stake in Informatica; pushes for sale to private equity - Newswire Round-up 

Elliott Management, after disclosing an 8% stake in Informatica (NASDAQ:INFA), has announced that it plans to push the Redwood City, California-based software provider to consider a sale, according to a newswire report.

Bloomberg, citing a person with knowledge of the matter, noted that the activist hedge fund will attempt to convince Informatica to sell itself to a private equity firm.

Elliott's past is filled with similar endeavors, with the company advocating for changes at firms such as EMC Corp., NetApp Inc., and Juniper Networks Inc. after disclosing large stakes in the firms.

WSJ S&P Downgrades Russia Foreign Currency Rating to Junk

S&P Downgrades Russia Foreign Currency Rating to Junk
Ratings Firm Cuts Russia to Junk For the First Time in More Than a Decade

Standard Poor’s Ratings Services on Monday cut its foreign-currency rating on Russia to junk for the first time in more than 10 years.

A one-notch downgrade was largely expected and priced into Russian asset prices.

“The downgrade was largely as expected,” said Tim Ash, a strategist at Standard Bank. “This reflects a combination of lower oil prices, sanctions and the conflict in Ukraine with the difficult geopolitical tussle with the West which shows no sign of easing. These factors have and are expected to continue to weigh on Russia’s balance sheet and overall credit matrix.

“I would expect Fitch and Moody’s to follow relatively soon,” he added.

But Alexey Pogorelov, Russian economist at Credit Suisse, said the downgrade “might be more damaging for the Russian assets and the ruble than everyone thinks.”

Mr. Pogorelov said in recent days the pressure on the ruble has increased mainly from the geopolitical tension in the southeast of Ukraine and a threat of further sanctions.


On Dec. 23, S&P placed the country on negative watch, indicating a downgrade was likely, citing the rapid deterioration of its monetary flexibility and the impact of the weakening economy on the country’s financial system.

”The outlook is already very bleak as the economy is firmly on the path that leads to recession following the sharp fall in oil and the full-scale currency crisis that unfolded in December,” said Piotr Matys, a rates strategist at Rabobank.

The downgrade to junk cements the underlying trend of investors selling off their assets in Russia, which means that Russia’s central bank will have to support the ruble by keeping interest rates at 17% and may have to intervene directly in the foreign exchange market, Mr. Matys said.

“If capital outflows accelerate and international reserves continue to shrink rapidly, market speculations that Russia might implement capital controls are likely to escalate,” he said.

Despite the downgrade, Russia remains classified as investment-grade, based on most global fixed-income indexes’ rules as the country’s average rating—including S&P, Moody’s Investors Service and Fitch Ratings—is triple-B-minus. But another downgrade below junk level would render Russia ineligible for most investment-grade indexes.

On Jan. 16, Moody’s cut its Russia’s ratings to the brink of junk territory, bringing it in line with Fitch’s rating, and noted it was reviewing the country’s balance sheet, particularly its foreign-currency-reserves cushion.

”Moody’s caught up and they struck an appropriately negative tone when they kept Russia on review for another downgrade,” said Per Hammarlund, a strategist at SEB.

He added: “Given the weakness of the ruble and the high level of local rates, international lenders and investors will be attracted to Russia if sanctions are eased. Even if they don’t fully reverse net capital outflows, it will ease the burden on public finances and the pressure on” Central Bank of Russia reserves.

“In addition,” Mr. Hammarlund said, “if oil prices find a floor as seems reasonable in the second or third quarter and recover towards the end of 2015, both public finances and the ruble will look better.”

The ruble was trading at 67.67 to the dollar, down 3.5%.