Filed under: Deals, Best Buy (BBY)

Ideal Buy, Inc. (NYSE: BBY) has gone shopping across the pond, and will be spending about $2.1 billion in cash to purchase 50% of the UK’s Carphone Warehouse mobile telephone retailer. Ideal Purchase is signaling to the retailer world that it thinks mobile is the place to be, after it committed to expanding mobile market share here in the U.S. just recently in a huge way.

This multi-billion commitment to Carphone Warehouse will grant the European retailer to pay down debt and gets Ideal Buy a foothold in the European retail business in a pretty huge and immediate way. Along with Wal-Mart Stores, Inc. (NYSE: WMT), U.S. retailers are seeking out ways to expand their footprints globally. Carphone Warehouse isn’t just a small step in that direction, as it’s one of Europe’s largest mobile phone retailers.

Best Buy’s revenues continue to soar on an annual basis, and this partnership should add to that amount significantly. While U.S. competitor Circuit City Stores, Inc. (NYSE: CC) has had nothing but troubles recently and is just hanging out in la-la land while delivering substandard results every quarter, Best Purchase is going for the jugular — still growing sales and taking market share in the U.S. and now in Europe. Can it be stopped? For now, there’s no equal — so, no.

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Filed under: Forecasts, Deals, Industry, UAL Corp (UAUA), Oil

The airlines are now in such great trouble that they’re going to their lenders and asking for better terms on their debt. It seems to be working. UAL (NASDAQ: UAUA), parent of United, says it has gotten an improved deal from some of its banks.

According to The Wall Street Journal, “The company said this week its lenders approved a waiver of the so-called fixed-charge coverage ratio covenant on its credit line through the first quarter of 2009.” The ratio requires cash flow to stay at certain levels.

The banks are damned if the do and damned if they don’t. Other massive airlines will likely ask for similar deals. Banks have little options but to concur to improve lending terms.

The debt-holders at the major airlines know that high fuel prices make losses likely and those losses could go on for several quarters. Loan restrictions could cause the companies to move into default.

But the risk of changing loan terms is that the airlines will move into Chapter 11 anyway. Fuel costs could cripple them that much. The banks would have given superior deals and have nothing to show for it but worthless paper.

Douglas A. McIntyre is an editor at 247wallst.com and the author of the Ten Stocks Under $10 newsletter.

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Filed under: Deals, Ideal Buy (BBY)

Best Buy, Inc. (NYSE: BBY) has gone shopping across the pond, and will be spending about $2.1 billion in cash to purchase 50% of the UK’s Carphone Warehouse mobile telephone retailer. Best Purchase is signaling to the retailer world that it thinks mobile is the place to be, after it committed to expanding mobile market share here in the U.S. just recently in a large way.

This multi-billion commitment to Carphone Warehouse will allow the European retailer to pay down debt and gets Ideal Buy a foothold in the European retail business in a pretty huge and immediate way. Along with Wal-Mart Stores, Inc. (NYSE: WMT), U.S. retailers are seeking out ways to expand their footprints globally. Carphone Warehouse isn’t just a small step in that direction, as it’s one of Europe’s largest mobile phone retailers.

Best Buy’s revenues continue to soar on an annual basis, and this partnership should add to that amount significantly. While U.S. competitor Circuit City Stores, Inc. (NYSE: CC) has had nothing but troubles recently and is just hanging out in la-la land while delivering substandard results each quarter, Ideal Buy is going for the jugular — still growing sales and taking market share in the U.S. and now in Europe. Can it be stopped? For now, there’s no equal — so, no.

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Filed under: Forecasts, Deals, Industry, UAL Corp (UAUA), Oil

The airlines are now in such great trouble that they’re going to their lenders and asking for superior terms on their debt. It seems to be working. UAL (NASDAQ: UAUA), parent of United, states it has gotten an improved deal from some of its banks.

According to The Wall Street Journal, “The company said this week its lenders approved a waiver of the so-called fixed-charge coverage ratio covenant on its credit line through the first quarter of 2009.” The ratio requires cash flow to stay at certain levels.

The banks are damned if the do and damned if they don’t. Other large airlines will likely ask for similar deals. Banks have tiny options but to concur to improve lending terms.

The debt-holders at the major airlines know that high fuel prices make losses likely and those losses could go on for several quarters. Loan restrictions could cause the companies to move into default.

But the danger of changing loan terms is that the airlines will move into Chapter 11 anyway. Fuel costs could cripple them that much. The banks would have given superior deals and have nothing to show for it but worthless paper.

Douglas A. McIntyre is an editor at 247wallst.com and the author of the Ten Stocks Under $10 newsletter.

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Filed under: Earnings reports, Deals, Marketing and advertising, Clear Channel Commun (CCU), Economic data

Shares of radio broadcaster Clear Channel Communications Inc. (NYSE: CCU) were slightly up in early trading after the company posted higher first-quarter profit boosted in part by gains in its outdoor advertising unit. Though, the company was not able to beat analysts’ predictions as the weak economy put pressure on the overall advertising market.

Clear Channel Communications announced that its quarterly profit surged to $799.7 million, or $1.61 per share. The income figures were definitely something to cheer about. During its first quarter last year, the company had net income of $102.2 million or 21 cents per share. Excluding one-time items, earnings for the quarter would have been $0.19 per share. Analysts’ forecast (which typically exclude one-time items) was for $0.21 per share, according to Thomson Reuters.

The media and advertising display company also said that quarterly revenue rose 3.9% to $1.56 billion, compared with $1.51 billion reported in the same period a year ago, helped by favorable foreign exchange rates; excluding the effect of the week dollar, revenue rose only 1%. Analysts had been anticipating to see slower sales of $1.53 billion.

Clear Channel is currently in the process of trying to go private. The company’s shareholders approved a merger agreement with a group led by Thomas H. Lee Partners and Bain Capital Partners. But the deal fell into litigation this year when the companies sued their bankers who wanted to pull out of their financing commitment. In the light of those troubles, it looks like for the moment the radio broadcaster is unable to estimate a closing date and isn’t even certain that a closing will happen.

Eliza Popescu is a financial writer for the on the web investment advisory service Investor’s Observer.

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Filed under: Deals, Competitive strategy, Google (GOOG), Yahoo! (YHOO)

After Microsoft Corp. (NASDAQ: MSFT) walked away from a $40+ billion dollar deal with Yahoo, Inc. (NASDAQ: YHOO) this past week, competitor Google, Inc. (NASDAQ: GOOG) was very, very relieved. After all, a combined Micro-Hoo would have been a significant competitor (in a best-case scenario) to Google. To help dissuade both celebrations to make a deal, Google ran a two-week test on Yahoo! to supply the competitor with its own advertising system. The test went well.

Now that Yahoo! has proved that is could one day dump its search technology and outsource that piece of its business to Google, Google executives are looking for that exact scenario. They believe it will help prevent another attempt by Microsoft to purchase Yahoo! in the future. They are probably right — if Google were to become one of Yahoo!’s largest partners, there would be issues with Microsoft buying Yahoo! now or in the future, from a regulatory perspective.

Google co-founder Sergey Brin said that “We have been talking to Yahoo and we’re very excited to be working with them … we share a lot of values with them” in his remarks at yesterday’s annual Google shareholder’s meeting at Google’s Mountain View, Ca. headquarters. Brian added that a potential deal with Yahoo! was “not about scuttling (the deal).” Hogwash — I state that was exactly why the Google-Yahoo! test was performed. Look for a Yahoo!-Google search advertising partnership in the very near future, folks.

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Filed under: Earnings reports, Deals, Marketing and advertising, Clear Channel Commun (CCU), Economic data

Shares of radio broadcaster Clear Channel Communications Inc. (NYSE: CCU) were slightly up in early trading after the company posted higher first-quarter profit boosted in part by gains in its outdoor advertising unit. Though, the company wasn’t able to beat analysts’ predictions as the weak economy put pressure on the overall advertising market.

Clear Channel Communications announced that its quarterly profit surged to $799.7 million, or $1.61 per share. The income figures were definitely something to cheer about. During its first quarter last year, the company had net income of $102.2 million or 21 cents per share. Excluding one-time items, earnings for the quarter would have been $0.19 per share. Analysts’ forecast (which typically exclude one-time items) was for $0.21 per share, according to Thomson Reuters.

The media and advertising display company also stated that quarterly revenue rose 3.9% to $1.56 billion, compared with $1.51 billion reported in the same period a year ago, helped by favorable foreign exchange rates; excluding the effect of the week dollar, revenue rose only 1%. Analysts had been expecting to see slower sales of $1.53 billion.

Clear Channel is currently in the process of trying to go private. The company’s shareholders approved a merger agreement with a group led by Thomas H. Lee Partners and Bain Capital Partners. But the deal fell into litigation this year when the companies sued their bankers who wanted to pull out of their financing commitment. In the light of those troubles, it looks like for the moment the radio broadcaster is unable to estimate a closing date and isn’t even certain that a closing will happen.

Eliza Popescu is a financial writer for the on the internet investment advisory service Investor’s Observer.

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Filed under: Deals, Competitive strategy, Google (GOOG), Yahoo! (YHOO)

After Microsoft Corp. (NASDAQ: MSFT) walked away from a $40+ billion dollar deal with Yahoo, Inc. (NASDAQ: YHOO) this past week, competitor Google, Inc. (NASDAQ: GOOG) was very, very relieved. After all, a combined Micro-Hoo would have been a significant competitor (in a best-case scenario) to Google. To help dissuade both celebrations to make a deal, Google ran a two-week test on Yahoo! to supply the competitor with its own advertising system. The test went well.

Now that Yahoo! has proved that is could one day dump its search technology and outsource that piece of its business to Google, Google executives are looking for that exact scenario. They believe it will help prevent another attempt by Microsoft to buy Yahoo! in the future. They are probably right — if Google were to become one of Yahoo!’s largest partners, there would be issues with Microsoft buying Yahoo! now or in the future, from a regulatory perspective.

Google co-founder Sergey Brin said that “We have been talking to Yahoo and we are very excited to be working with them … we share a lot of values with them” in his remarks at yesterday’s annual Google shareholder’s meeting at Google’s Mountain View, Ca. headquarters. Brian added that a potential deal with Yahoo! was “not about scuttling (the deal).” Hogwash — I state that was exactly why the Google-Yahoo! test was performed. Look for a Yahoo!-Google search advertising partnership in the very near future, folks.

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Filed under: Before the bell, Earnings reports, Deals, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), General Motors (GM), Employees, Market matters, Citigroup Inc. (C), Amer Intl Group (AIG), Economic data

Stock futures were once again lower this morning, setting up stocks for a sharp decline after AIG reported a large $7.8 billion loss and oil set a record above $125 a barrel. With credit crunch concerns resurfacing and inflation worries on investors’ minds, futures point to heavy losses today.

On Thursday, U.S. stocks ended higher despite another surge in oil prices following better-than-expected April sales reports from many retailers including Wal-Mart and Costco. The Dow industrials ended 52 points, or 0.41%, higher, the S&P 500 rose 5 points, or 0.37% and the Nasdaq Composite rose 12 points, or 0.52%.

Without much economic news set for today except for the March U.S. trade gap, investors will focus on AIG’s results and their implication on the financial and credit market as well as on oil prices.

American International Group (NYSE: AIG) reported a quarterly $7.8 billion loss after the market close Thursday. AIG also said it will raise $12.5 billion in the coming months as its capital base has deteriorated due to the crisis in the credit markets. Shares of AIG have declined over 7.2% in premarket trading, but the real affect of its results can seen across the financials as fears have resurfaced once again about the impact of the credit crunch on financial firms.

As if that wasn’t enough, adding to the negative sentiment is oil. Crude oil for June delivery climbed as much as $1.43, or 1.3%, to $125.12 a barrel. While prices have retreated somewhat, they remained near $125 at around $124.8 a barrel. For the week, oil has risen 7.4%, making Wall Street nervous about inflation. Mind you, 55%of 372 petroleum industry executives surveyed by KPMG LLP stated they think the price of a barrel of crude will drop below $100 by the end of the year.

Among news headlines today is Citigroup (NYSE: C) and its CEO Vikram Pandit who is set to reveal a strategic plan to turnaround Citigroup from the damage it suffered due to the subprime crisis.

And after a bitter, 10-week strike at auto parts supplier American Axle and Manufacturing Holdings Inc., General Motors Corp. (NYSE: GM) has concurred to kick in up to $200 million to help settle the dispute.

And returning for a moment to the Microsoft, Yahoo! saga, the former is no longer expected to reverse its decision regarding the Yahoo! acquisition and is seen growing its own advertising and Internet search business. Meanwhile, Google has proposed an advertising partnership with Yahoo following a two-week test program between the firms that apparently succeeded.

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