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   Strategies & Market TrendsSpeculating in Takeover Targets


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To: richardred who wrote (3629)2/21/2014 12:14:53 AM
From: richardred
   of 6544
 
Facebook answers back at Google.

Wall Street sees sense in Facebook's $19 billion WhatsApp buy


(Reuters) - Facebook Inc's purchase of fast-growing messaging startup WhatsApp for an eye-popping $19 billion largely won approval from analysts, who said the deal made strategic sense as it will solidify the social network's position as a leader in mobile.

Facebook shares closed up 2.3 percent at $69.63 after falling as much as 3 percent in early trading as investors got over the initial sticker shock of the deal value.

At least two brokerages downgraded their recommendations on Facebook to "hold" but the overwhelming majority of analysts remain positive on the stock.

Facebook is paying more than double its annual revenue for a chat program that has little revenue. The purchase price is slightly more than the market value of Sony Corp.

But analysts noted that WhatsApp has over 450 million users and boasts a higher level of engagement than Facebook.

"Facebook is the leading global social-sharing utility. Now, it has a significant opportunity to be the leading global communications utility," RBC Capital Markets said in a note.

WhatsApp is much stronger than Facebook Messenger in Europe, Latin America, Africa and Australia and has attracted users at a time when it appears that young people are turning away from Facebook.

Analysts said the price tag for WhatsApp, founded in 2009 by former Yahoo Inc employees Jan Koum and Brian Acton, seemed reasonable from the point of view of value per user.

Facebook is paying $42 per user, compared with a market value per user of $170 for Facebook and $212 for Twitter, Deutsche Bank's Ross Sandler said.

WhatsApp's user base is less than half that of Facebook's 1.2 billion but the chat program's users are more active. On any given day, 70 percent of WhatsApp users are active, compared with 62 percent for Facebook. WhatsApp's users are expected to reach 1 billion by 2015, according to many analysts.

"Looking past the sticker shock of $19 billion ... We view (the deal) as an offensive move to gain additional share of the consumer's time spent," Credit Suisse analysts said, noting that Facebook was paying about 11 percent of its market value to gain a 30 percent rise in engagement.

HAVE SCALE, WILL MAKE MONEY

Of the 44 analysts who cover Facebook, 37 have a "buy" or a "strong buy" rating on the stock, according to Thomson Reuters data. None has a "sell" rating.

Analysts have commended Facebook's ability to make money from its mobile app. Now they will want to see how it will earn money from the chat app's huge number of users.

"While we don't expect messaging to be a meaningful near-term or even long-term revenue driver, the real value could be the evolution of the platform to incorporate new functionality such as payments, app distribution, social features ...," Macquarie Equities Research analyst Ben Schachter said.

Facebook has fallen behind in mobile phone messaging apps in emerging markets, where many are accessing the Internet on fast-growing 3G mobile networks for the first time on smartphones.

Asian rivals such as Tencent Holdings Ltd's WeChat, Naver Corp's Line and Rakuten Inc's Viber are well ahead of Facebook messenger across much of Asia.

Facebook has been buying apps with large numbers of young users as part of Chief Executive Officer Mark Zuckerberg's strategy of helping users share any kind of content with anyone.

The company's $1 billion deal to buy photo-sharing application Instagram in 2012 and its recent $3 billion failed overture to buy SnapChat - used by teenagers to send texts and photos that disappear after a few seconds - followed unsuccessful attempts to develop rival apps.

"Large-scale networks like WhatsApp are rare and provide (a) significant monetization opportunity (i.e. YouTube) justifying valuation over time," SunTrust Robinson Humphrey's Robert Peck said in a note.

Analysts estimate WhatsApp users share 19 billion messages, 600 million photos, 200 million voice messages, and 100 million video messages per day.

Still, some analysts said Facebook was paying a high price to keep WhatsApp from being snapped up by a rival such as Google Inc.

"Facebook shares would have been pressured by more than single-digit percentages in after-market trading if Google had purchased WhatsApp instead," Stifel analyst Jordan Rohan said in a note.

Pivotal Research's Brian Wieser, who downgraded his rating on Facebook shares to "hold" from "buy," said he expects Facebook shares to face pressure in the near-term as investors come to terms with the risk of future acquisitions.

(Reporting by Soham Chatterjee and Saqib Iqbal Ahmed in Bangalore; Editing by Saumyadeb Chakrabarty and Lisa Shumaker)

finance.yahoo.com

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To: richardred who wrote (2148)2/21/2014 1:39:10 PM
From: richardred
   of 6544
 
RE-LOJN Maybe light at the end of the tunnel. The company's big in Italy. I'm guessing just maybe the company can ride the coattails of Fiat's ownership of Chrysler? Anyway a Tesla is an expensive car and they seem to be selling.

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To: richardred who wrote (3630)2/22/2014 8:54:31 AM
From: richardred
   of 6544
 
Mayer says Yahoo investing in search through acquisitions
SNIP>Mayer talked at length Tuesday about Yahoo's efforts around "native advertising," in which advertisers provide content that looks like editorial content. She also talked about its programmatic ad-buying technologies, which can target ads based on user data.

computerworld.com

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To: richardred who wrote (3576)2/22/2014 9:37:28 AM
From: richardred
   of 6544
 
Element CEO Weighs C$1 Billion in Acquisitions in 2014
By Stefanie Batcho-Lino and Doug Alexander Feb 21, 2014 4:14 PM ET
Element Financial Corp. (EFN) plans two purchases in 2014 totaling at least C$1 billion ($898 million) as the Canadian lessor seeks to expand its North American railcar unit and enter the U.S. for vehicle-fleet management.

One of the deals may come as soon as early next quarter, according to Chief Executive Officer Steve Hudson, who said the acquisitions would each be C$500 million or more. He said he has been looking at eight to 10 companies as possible targets.

bloomberg.com

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To: richardred who wrote (2725)2/22/2014 9:41:27 AM
From: richardred
   of 6544
 
Ireland's Smurfit eyes acquisitions, hikes dividend
Wed Feb 12, 2014 3:25am EST





DUBLIN, Feb 12 (Reuters) - Irish packaging group Smurfit Kappa is looking for acquisitions in the Americas and eastern Europe and will return cash to shareholders if it doesn't find the right target, it said on Wednesday.

Smurfit, which designs and manufactures paper-based packaging for the likes of Unilever and Procter & Gamble, raised its dividend by 50 percent to 30.75 cents a share after posting a jump in fourth-quarter results.

Its shares rose 4.7 percent to 18.95 euros by 0817 GMT, supported by the higher payout to investors.

"Our focus is on doing M&A (mergers and acquisitions)," Chief Financial Officer Ian Curley told reporters. "If we don't find any to do, we will return capital to shareholders."

Smurfit, whose pretax profit rose 91 percent to 62 million euros ($85 million) in the fourth quarter, is looking at purchases in the high growth areas of the Americas and eastern Europe in particular, it said in a statement.

The company brought down its net debt by 6 percent in 2013 to 2.6 billion euros, which boosts its available cash.

"For a long time, the company used its strong cash generation to pay down debt. Now that the balance sheet has been repaired, shareholders should really start to get the benefit of the cash," said Barry Dixon of Davy Research.

reuters.com

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To: richardred who wrote (2822)2/22/2014 10:08:28 AM
From: richardred
   of 6544
 
Apple exploring cars, medical devices to reignite growth

Thomas Lee and David R. Baker
Updated 9:30 pm, Sunday, February 16, 2014

snip> Apple's potential forays into automobiles and medical devices, two industries worlds away from consumer electronics, underscore the company's deep desire to move away from iPhones and iPads and take big risks.

"Apple must increasingly rely on new products to reignite growth beyond the vision" of late founder Steve Jobs, said Bill Kreher, an analyst with Edward Jones Investments in St. Louis. "They need the next big thing."

sfgate.com

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To: Glenn Petersen who wrote (3635)2/24/2014 9:21:15 AM
From: richardred
   of 6544
 
The saga continues with a higher bid.

Men’s Wearhouse Raises Bid for Jos. A. Bank

Men’s Wearhouse on Monday announced that it had increased its tender offer to $63.50 per share, up from the $57.50 per share it had offered previously, less than two weeks after Jos. A. Bank announced a plan to buy Eddie Bauer in what appeared to be an attempt to discourage the takeover attempt.
dealbook.nytimes.com

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To: richardred who wrote (3636)2/24/2014 10:18:46 AM
From: Glenn Petersen
   of 6544
 
Davidoff's article struck me as being hastily written. I kept waiting for a Pac-Man or Fat Man reference and it never came. He was more focused on the structure of the Eddie Bauer bid, although I have to admit that I had a hard time understanding how the structure would deter Men's Warehouse. Obviously, it did not.

As for Sears, I don't have a clue as to Lampert's end game. He has taken his time selling off or spinning out the various pieces while letting the stores deteriorate. I don't think that it will end well.

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To: Glenn Petersen who wrote (3647)2/24/2014 10:29:53 AM
From: richardred
   of 6544
 
In general the whole retail group is undergoing current weakness. As usual, weather is being blamed. IMO However, online retailing is making major inroads.

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To: richardred who wrote (3508)2/24/2014 12:13:55 PM
From: richardred
   of 6544
 
Sold PTIE today. Out with a gain. I'm not willing to wait any longer for possible FDA action in the future.

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