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2008
Archive for April 24th, 2008
Filed under: Deals, Industry, McDonald’s (MCD), Wendy’s Intl (WEN), Burger King Hldgs (BKC) Wendy’s (NYSE: WEN) finally sold the company to Nelson Peltz. The price which Peltz company Triarc paid was about $26.78 per share only a 6% premium according to the AP. One of the reasons the firm went for so tiny might be that there were no other buyers. The Wall Street Journal writes that “The move puts an end to the year-long saga that began when Wendy’s first stated it would consider a sale last April after Mr. Peltz began pressuring the chain.” Peltz has gotten a very good deal and Wendy’s shareholders haven’t. The chain’s current stock price is near its 52-week low. Over the last six months, the company’s shares are down about 23% while rivals Burger King (NYSE: BKC) and McDonald’s (NYSE: MCD) are up about 5%. Of course, they are the market share leaders and deserve some premium for that. But if fast food does well, especially in a poor economy when people can’t afford more high-priced restaurants, Peltz will have picked up a prize. When a recovery comes around, Wendy’s could become a very nice business and the billionaire will look like a genius. Douglas A. McIntyre is an editor at 247wallst.com. Filed under: Before the bell, Earnings reports, Analyst reports, Deals, Apple Inc (AAPL), Wal-Mart (WMT), PepsiCo (PEP), Motorola (MOT), 3M Corporation (MMM), Bank of America (BAC), Countrywide Financial (CFC), Newell Rubbermaid (NWL), Wendy’s Intl (WEN), Dow Chemical (DOW)  Before the bell: Futures down on SBUX, AMZN, despite AAPL, Ford
Dow Chemical (NYSE: DOW) reported a smaller-than-forecast 3% profit drop Thursday and said it would have a good second quarter. Higher feedstock and energy costs were blamed for the drop. The chemical giant reported earnings of 99 cents per share, beating the 94 cents estimate. If two weeks ago some hoped we’ve seen the bottom of the subprime mortgage crisis, since then more problems, especially with European banks seem to pop. Credit Suisse (NYSE: CS) reported a wider-than-forecast loss of $2.1 billion on a $5.3 billion writeoff as the global effects of the U.S. subprime mortgage crisis continued to spread. Share of CS though are rising in premarket trading about 1.8% as the bank might have seen the worst.
Bank of America Corp. (NYSE: BAC) shareholders don’t want the bank to proceed with the $4 billion acquision of Courntrywide Financial Corp. (NYSE: CFC), the mortgage lender that has become the poster child for the subprime mortgage problems. The have pleaded on Wednesday with the bank’s CEO. PepsiCo (NYSE: PEP) reported a 5% profit increase and a solid top-line performance due to its international division that helped offset higher commodity costs. Net income jumped to $1.15 billion, or 70 cents per share, inline with estimates. Revenue, though, climbed 13%, beating estimates. Wendy’s International Inc (NYSE: WEN) will this day announce a deal with Peltz, the Wall Street Journal reported. This will culminate a year-long review as the Journal reports the board voted on Wednesday on the transaction, though its exact nature or price involved is yet unknown. WEN shares are up 8% in premarket trading. Also reported this morning:
Finally, Wal-Mart Stores Inc (NYSE: WMT) Sam’s Club warehouse division stated on Wednesday it is limiting sales of several types of rice, the latest sign that fears of a rice shortage are rippling around the world. Lehman Brothers analyst Ben Reitzes raised his fiscal third-quarter earnings outlook to $1.10 per share from $1.07 per share due to bullish outlook on Mac sales. BUSINESS | KHOU.com | News for Houston, Texas Business.Utah.gov - Utah.gov Access Washington - Doing Business in Washington Business Intelligence from Business Objects Business Plan Software and Books - Business-plan.com business ethics Business | www.azstarnet.com ® Chicago news, sports, photos, video, blogs, Chicago weather, business Postbulletin.com: Business news for Rochester, MN Business | www.macon.com Filed under: Deals, Law, eBay (EBAY)
And now there’s a massive issue with eBay (NASDAQ: EBAY), which owns 28.4% of Craiglist. Apparently, the relationship has been somewhat rocky as is evident by the lawsuit announced last night. eBay is claiming that the board of Craigslist (which consists only of Newmark and the CEO, Jim Buckmaster) has attempted to water down the ownership position - to a mere 10%. I have the ability to certainly understand Craigslist’s actions. After all, eBay has its own classifieds service called Kijiji. But hey, in the tech world, such arrangements are nothing new. It’s to be expected (and so are lawsuits). Interestingly enough, Newmark is not being shy about things and has responded via his blog. According to him, the lawsuit is a surprise and he claims that eBay has “ulterior motives,” which might involve a hostile takeover. Really? Let’s see, how many times has eBay launched a hostile deal? I can’t remember. Plus, such a thing is nearly impossible for a minority shareholder to pull off (and, even more difficult if the ownership position has been heavily diluted). Unfortunately, eBay’s legal complaint wasn’t disclosed (because of confidentiality reasons), but the venue is Delaware, which has lots of expertise in shareholder disputes and usually handles things fairly quickly.
24
04
2008
Option Update: Yahoo volatility elevated as MSFT deadline approachesPosted by: in Latest NewsFiled under: Deals, Microsoft (MSFT), Yahoo! (YHOO), Options
Jeffries say’s YHOO “1Q results suggest slow but steady progress in display and search, while weak affiliate business continue to dampen overall growth.” Microsoft (NASDAQ: MSFT) announced on Jan. 31 an offer for YHOO payable in $31 cash or 0.9509 per share of MSFT. Dow Jones reported this morning MSFT’s CEO Steve Balmer has no plans to raise its YHOO offer, “prepared to move forward without YHOO.” MSFT deadline for moving forward with a hostile takeover of YHOO is April 26. YHOO May option implied volatility of 48 is above its 26-week average of 40 according to Track Data, suggesting larger price movement. Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com |
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