>>> Fiat : JPM First Comment

FCA: looks like three steps (i) place 10% of Ferrari and distribute remaining stock to Fiat shareholders (ii) raise 2.5bn USD mandatory convertible (iii) FCA anticipates that it will offer up to 100 million FCA common shares including 35 million common shares currently held in treasury by FCA and approximately 54 million common shares that will be issued by FCA to replenish the share capital canceled following the exercise by Fiat S.p.A. Call at 1400
On Ferrari:
-Broker estimates average value between €3.3.bn and €5.4bn with a median of €4.3bn
-EBITDA at 10000 units p.a. is well in excess of €1bn

Fiat owns 90% of Ferrari, with founder Pietro Ferrari owning 10%. Fiat will first sell 10% in an IPO to raise cash, then distribute proportionally the remianing 80% to its own shareholders (like a dvd in-specie). Exor will end up with c.24% of the equity (double voting rights). The Fiat rump is going to be left even more leveraged, having distributed the most valuable asset, but the proceeds from 10% sale and the $2.5bn mandatory convertible will help.

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance: CARA +15.6%, ZLTQ +10.9%, ICAD +9.9%, X +8.1%, EXTR +7.6%, ACCO +6.9%, TQNT +6.8%, EGL +4.2%, (enters into definitive agreement to acquire TASC for ~$1.1 bln, , including the assumption of net debt; expected to be significantly accretive to 2016 adjusted EPS; co stockholders to receive special dividend of ~$11.40 per share in cash ), IPHI +3.7%, CHRW +3.7%, MRCY +3.6%, AMC +3.5%, SWI +3.5%, DLR +3.3%, ULTI +3%, AUO +3%, XCO +2.5%, GPRE +2.5%, JLL +2.5%, EA +2.2%, WES +1.7%, (to acquire Nuevo Midstream), WLP +1.7%, SKYW +1.5%, CAP +1.3%, ETN +1.3%, HES +1.3%, PSX +1.3%, EXP +1.2%, WYNN +0.9%, WEX +0.9%

Other news: CARA +15.6% (announces positive results from human abuse liability trial of peripheral Opioid for acute pain, I.V. CR845; met the trial's primary endpoint), ARNA +6.4% (announced positive top-line results of a pilot study to assess the safety of lorcaserin HCl and phentermine HCl), SPF +6% ( announces share repurchase program of up to $100 mln of the company's common stock), AKS +5.6% ( announces price increase for carbon steel products; co today that it will increase current spot market base prices for all carbon flat-rolled steel products by a minimum of $20 per ton, effective immediately with new orders), RFMD +5.2% (following TQNT results), EGL +4.2% (entered into an agreement to acquire TASC for ~$1.1 bln, including the assumption of debt),RGLS +2.8% (prices 5,294,118 shares of its common stock at a price to the public of $17.00 per share by co and existing shareholder Isis Pharmaceuticals (ISIS)), IDT +2.6% (declared a special dividend of $0.68 per share), SANM +1.9% (announced the start of production for Raytheon missile systems electronic assemblies), CYBR +1.8% (following 8% decline yesterday), LECO +1.7% (Board approved a 26% quarterly dividend increase to $0.29 per share and raised its 2014 share repurchase target 20% to $300 mln), JKS +1.6% (to supply 19 MW of solar modules for a PV project in Chile), CNHI +1.5% (still checking), PLUG +1.1% (commissions site at Golden State Foods; Deploys GenDrive hydrogen fuel cells at new regional distribution center), GRPN +1% (product chief to leave the company, according to reports), VGGL +1% (secures $30 million in investment to fuel innovation for its marketing and rewards platform), GPRO +1% (cont vol pre-mkt)

Analyst comments: UNIS +11.9% (target raised to $9 from $5 at Jefferies), AVNR +2.2% (initiated with a Buy at BofA/Merrill), JMBA +1.6% (upgraded to Outperform from Neutral at Wedbush), CBS +1.5% (added to Franchise Pick list at Jefferies), AMZN +0.9% (initiated with a Overweight at Morgan Stanley

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance: INVN -19.7%, KEYW -14.5%, ARCP -14.3%, XOOM -12.6%, (to launch cross-border bill pay; Xoom Bill Pay is scheduled to launch in November with cross-border bill pay to Mexico, Guatemala, El Salvador, Nicaragua and the Dominican Republic), AMCC -10.6%, STM -10.2%, SM -8%, FB -6.7%, BLDP -5.4%, MTSC -5.2%, HSY -4.7%,SODA -4.2%, NVMI -4.1%, BBSI -3.3%, GILD -2.9%, PNRA -2.9%, RYAM -2.7%, COT -2.5%, DB -2.3%, VRTX -1.8%, AZPN -1.8%, OI -1.8%, WDC -1.7%, HTS -1.6%, TRN -1.2%, GAIN -1.2%, MCK -1.1%, FISV -1%, WEC -1%, XRAY -1%, TEL -0.9%, PAG -0.9%

M&A news: APA -0.8% (following late move higher on reports of interest in Apache's Wheatstone stake), LORL -0.2% (following late move higher on potential new offer)

Other news: ARCP -14.3% (announces non-reliance on previously issued financial statements and changes in accounting personnel), HIVE -11.8% (disclosed that in response to the market reaction to their PR yesterday), IBIO -11.2% (cont vol pre-mkt), NBG -6.9% (may be related to wte earnings from a couple of EU perifery banks in last cpl days), SNY -5% (Statement from Sanofi Board of Directors; removes CEO), UBA -3.8% (is offering 2,500,000 shares of its Class A common stock in a public offering), VNDA -2.2% (proposes public offering of common stock ), TRUE -1.5% (filed for a 1 mln share offering of common stock by selling shareholders; co also provided Q3 guidance),, PRU -1.5% (entered into an MoU with Inversiones La Construccion S.A. to acquire ownership stake in Administradora de Fondos de Pensiones Habita), AMAT -1.4% (completion of Tokyo Elec (TOELY) may extend into the first calendar quarter of 2015 ), TRN -1.2% (may be required to have mediation talks over guardrail lawsuit, according to reports), TWTR -0.8% (in symp with FB earnings)

Analyst comments: TLK -1.4% (downgraded to Neutral from Overweight at JP Morgan ), NTT -1.4% (downgraded to Neutral from Buy at Goldman ), SNCR -1.1% (downgraded to Outperform from Strong Buy at Raymond James), EBAY -1% (initiated with a Underweight at Morgan Stanley), KORS -0.9% (downgraded to Neutral from Buy at Janney), DTE -0.9% (downgraded to Hold from Buy at ISI Group)

>>> ALU - Awarded bids for its ground-breaking IP core router by China Telecom,

Awarded bids for its ground-breaking IP core router by China Telecom, China Unicom and China Mobile -

- China Telecom, China Unicom and China Mobile the three biggest telecommunications service providers in China have each chosen the 7950 XRS (Extensible Routing System) from Alcatel-Lucent (Euronext Paris and NYSE: ALU) for their IP-based core networking needs in order to meet rapidly accelerating demand for fixed and mobile broadband access in the nation of almost 1.4 billion people.

The 7950 XRS core router is the 'traffic cop' that directs data traffic at the heart of an IP network, handling multiple Terabits of data per second. The system, which offers industry-unique benefits in space saving and energy efficiency, provides operators with up to five times the data capacity of other core routers on the market.

China is anticipating massive growth of data and video in the coming years for residential and enterprise customers due to increasing demand for high-definition content, on-demand viewing, multi-screen delivery, the widespread use of smart-phones and tablets and the rapid adoption of cloud applications.

The first scale commercial deployments of the 7950 XRS in China will enable China Telecom, China Unicom and China Mobile, to address this expected explosion of demand for capacity over the next five years, as well as supporting the operators' contributions to China's national 'Broadband China' strategy. 

The selection of the 7950 XRS is the result of a recent central bidding process for IP core routers. The deployments will mark the first scale commercial use of the system in China.

>>> Fiat Chrysler : Reportedly approves a spin off of Ferrari

Reportedly approves a spin off of Ferrari; offering a 10% stake of the firm to the market with the rest going to shareholders 
- Plans to complete spin off next year, and will list Ferrari shares in the US and Europe.

- Reminder earlier today Ferrari reported Q3 segment performance:Revenues were €662 million (+24%), with 1,610 street cars shipped (+8%). EBIT was €89 million, including €15 million in compensation costs related to the resignation of the former chairman. Net of this item, EBIT was up €16 million with improved sales mix driven by the LaFerrari.

what he said before : 
* In 2013: 
06/27 Fiat Chairman: Reiterates no plans to IPO Ferrari 05/30 Fiat Chairman: no plans to spin off Ferrari

05/08 Ferrari CEO: no plan to spin off Ferrari from Fiat

- In 2012: Fiat CEO Marchionne: No longer have enough money to buy the remaining 41.5% stake in Chrysler, but may IPO Ferrari in order to raise money to do so.

>>> Good Year - Conf Call Slides

Guides initial FY15 global volume +1-2% y/y; FX headwinds in FY15 to be similar to FY14 - conf call slides 
- In FY15 to see positive price mix vs. raw materials (~$50-100 million)- Guides initial FY15 capex $1.2B
- In FY15 sees potential release of US tax valuation allowance. Tax rate if released: 30-35% of global pre-tax income, no US cash taxes for ~5 years
- Venezuela to be a source of uncertainty in FY15
- Our strategy gives us confidence in the future plan to repurchase up to $150 million of our common stock in Q4
- In Q4, increasing demand for our premium branded products was outpacing supply. Constraints were limiting our ability to offset negative volume impact of potential tariff in economy & mid-tier segments. Actions to address increasing demand for our HVA tires:
Current growth capexplan will increase capacity (2014+)
Leveraging our global HVA footprint (2015+)
Building capacity with announced new Americas plant (2017+)

(BFW) Fiat Chrysler 3Q Profit Misses Est.; Confirms Targets

--> -2% on numbers

Fiat Chrysler 3Q Profit Misses Est.; Confirms Targets
2014-10-29 12:28:45.276 GMT


By Brian Lysaght
Oct. 29 (Bloomberg) -- Fiat Chrysler 3Q Ebit EU926m, est.
EU937m.
* Rev. EU23.55b, est. EU22.2b
* Outlook: Confirms 2014 targets incl Ebit ex-items EU3.6b-
EU4b
* Call: 3pm CET 44 20 3427 1917 pin 3565288
* Statement via Website
* Shares up 0.66% ytd vs SXAP down 6.9%
* See Oct. 28: Fiat Said to Favor Mandatory Convertible Bond
* VW reports 3Q tomorrow
* Industry preview


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To contact the reporter on this story:
Brian Lysaght in London at +44-20-7330-7908 or
blysaght@bloomberg.net
To contact the editors responsible for this story:
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jludden@bloomberg.net
Brian Lysaght

>>> Goodyear Tire beats by $0.17, misses on revs

Goodyear Tire beats by $0.17, misses on revs

Reports Q3 (Sep) earnings of $0.87 per share, excluding non-recurring items, $0.17 better than the Capital IQ Consensus Estimate of $0.70; revenues fell 6.9% year/year to $4.66 bln vs the $4.93 bln consensus.

The company reaffirmed its 2014-2016 financial targets, which include:
  • Segment Operating Income growth of between 10 percent and 15 percent per year, -
  • Annual positive Free Cash Flow from Operations and, -
  • An Adjusted Debt to EBITDAP ratio of 2.0x to 2.1x.
  • The company now anticipates Segment Operating Income growth in 2014 will be near the high end of the 10 percent to 15 percent range. Based on year-to-date performance, the company now expects unit volumes to be flat to up 1 percent for 2014 over 2013.

>>> Polo Ralph Lauren beats by $0.20, misses on revs; guides Q3 net revs below c

--> RL -0.3% pre open - low volume

Polo Ralph Lauren beats by $0.20, misses on revs; guides Q3 net revs below consensus; lowers FY15 rev on FX

Reports Q2 (Sep) earnings of $2.25 per share, $0.20 better than the Capital IQ Consensus Estimate of $2.05; revenues rose 4.1% year/year to $1.99 bln vs the $2.02 bln consensus.

Co issues downside guidance for Q3, sees Q3 revs of +3-5% to ~$2.08-2.12 bln vs. $2.18 bln Capital IQ Consensus. Operating margin for the third quarter of Fiscal 2015 is expected to be approximately 100-150 basis points below the comparable prior year period due to higher cost of goods and incremental investments in the Company's strategic growth objectives. The third quarter tax rate is estimated at 30%.

Co issues downside guidance for FY15, sees FY15 revs of +5-7% to ~$7.59-7.73 bln vs. $7.94 bln Capital IQ Consensus. The Company is maintaining its constant dollar outlook for Fiscal 2015. However, as a result of recent, unfavorable foreign currency movements, the Company now expects consolidated net revenues for Fiscal 2015 to increase by 5%-7% compared to its previous outlook of 6%-8% growth. The Fiscal 2015 operating margin is still estimated to be ~75-125 basis points below Fiscal 2014's level, likely at the mid-to-low end of that range due to incrementally negative foreign currency movements. The full year Fiscal 2015 tax rate is estimated at 30%including a 200 basis point net negative impact from foreign currency translation.