PG&E stock rallied sharply after it reached a $13.5 billion deal with the victims of deadly wildfires caused by its equipment. That means the company has cleared one of its biggest hurdles to a timely exit from bankruptcy court.
The parent company of Texas Capital Bank and the holding company for Independent Bank plan to combine in an all-stock merger for the Dallas-area firms.
Swiss private bank Vontobel is exiting its brokerage business, it said on Monday, a move that includes selling its equity unit to Zuercher Kantonalbank (ZKB) as it focuses on buy-side investment management for wealthy clients. The changes will affect about two dozen jobs and include the departure of long-time investment banking head Roger Studer from his operational role.
DEEP DIVE As we approach the end of 2019, it’s time not only for year-end lists, but end-of-decade lists. U.S. stocks have had what can only be called an excellent decade. MarketWatch will feature a number of forward-looking articles building on the past decade’s action.
French drugmaker Sanofi has agreed to buy Californian biotech Synthorx for $2.5bn in a bid to combat falling revenues in its core insulin and cardiovascular franchises. The deal, with which Sanofi aims to strengthen its pipeline of drugs for oncology and autoimmune disorders, brings with it the prize of Synthorx’s promising medicine to treat solid tumours. Sanofi unveiled the acquisition a day before Paul Hudson, who took over as the French group’s chief executive in September, unveils his new strategy to investors.
The S&P 500 is having its best run in six years, but individual investors are fleeing stock funds at the fastest pace in decades, according to data from Refinitiv Lipper.
Dec.09 -- M&A Monday has begun with another big deal in the biotech space. Sanofi has agreed to buy U.S.-based Synthorx in a buyout worth approximately $2.5 billion. Bloomberg’s Sarah Syed reports on “Bloomberg Markets: European Open.”
(Bloomberg) -- When U.S. prosecutors charged an Apple Inc. engineer in January with stealing trade secrets for a Chinese startup, a search of his home turned up something else, they said: a classified file from the Patriot missile program that belonged to his ex-employer, Raytheon Co.The discovery has added a striking national security wrinkle to an otherwise routine corporate espionage case, and the government says it merits keeping Jizhong Chen under close scrutiny.The Patriot document was discovered among numerous electronic devices and paper files from Chen’s former employers including General Electric -- some of which were stamped “confidential,” according to prosecutors.Chen, a U.S. citizen who was arrested on his way to catch a flight to China, is awaiting trial on charges that he collected photos, schematics and manuals from his work on Apple’s tightly guarded self-driving car project as he prepared to take a job with an unidentified rival.He has pleaded not guilty and remains free on $500,000 bail. But prosecutors argue the stash of sensitive data found in Maryland justifies subjecting him to location monitoring with an electronic device so he doesn’t disappear before his trial.Lawyers representing Chen and a second former Apple engineer facing similar charges -- who is also fighting prosecutors over the need for location monitoring -- contend the government is exaggerating the risk they’ll try to flee.The 2011 document relating to one of Raytheon’s best-known weapons was so secret that it “was not (and is not) permitted to be maintained outside of Department of Defense secured locations,” prosecutors said in an Oct. 29 filing that hasn’t previously been reported on by the media. Chen “has, for over eight years, illegally possessed classified national security materials taken from a former employer.”How a classified document ended up at an engineer’s home raises provocative questions, but they’re unlikely be answered in open court at a hearing set for Monday. A prosecutor and an attorney for Chen both declined to comment ahead of the hearing. A Raytheon spokeswoman didn’t respond to a request for comment.Read More: Tesla to Apple: Help Us Nail Robocar-Secrets Thief at China FirmAfter prosecutors first raised concerns about the evidence they found in Maryland, a magistrate judge agreed in March to extend an electronic monitoring requirement to give the government time to investigate. She finally ordered an end to the monitoring in October -- and prosecutors are now asking a district judge to overrule her.Lawyers for Chen say prosecutors have had enough time to present further evidence of criminal conduct. They also note that the federal office that supervises defendants on probation has concluded monitoring is no longer necessary because Chen has complied with all the conditions of his release and found full-time employment.Daniel Olmos represents both Chen and Zhang Xiaolang, who also worked on Apple’s autonomous driving project before he was arrested in July 2018 and accused of trying to take the company’s trade secrets to China-based XMotors. The lawyer makes an argument that goes to the heart of the cases against both men: There’s no evidence that Apple’s intellectual property was shared with a third party. That’s significant because possession of the information alone isn’t necessarily a crime.Olmos also contends that each of the engineers has strong ties in the U.S. and the trips they were about to take to China when they were arrested were planned for the purpose of visiting relatives, not escaping prosecution.“The government’s argument that Mr. Zhang poses a flight risk because he is a Chinese citizen is insufficient to warrant GPS monitoring,” Olmos said in a filing. “Mr. Zhang has full-time employment, a new family, and no travel documents.”The cases are U.S. v. Chen, 19-cr-00056, and U.S. v. Zhang, 18-cr-00312, U.S. District Court, Northern District of California (San Jose).To contact the reporters on this story: Peter Blumberg in San Francisco at email@example.com;Robert Burnson in San Francisco at firstname.lastname@example.orgTo contact the editors responsible for this story: David Glovin at email@example.com, Anthony Lin, Peter BlumbergFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
A new analysis of where "innovation" jobs are being created in the United States paints a stark portrait of a divided economy where the industries seen as key to future growth cluster in a narrowing set of places. It is seen as a source of social stress, particularly since President Donald Trump tapped the resentment of left-behind areas in his 2016 presidential campaign. Research from the Brookings Institution released on Monday shows the problem cuts deeper than many thought.
The aluminium market is in trouble again. The London Metal Exchange (LME) price touched a three-year low of $1,705 per tonne in October and has failed to stage any significant bounce over the intervening period. Earlier this year there was a lot of excited talk in the market about growing supply deficits and falling stocks.
The congresswoman responds to a story about how Uber’s Greenlight Hub office in Providence, R.I., has separate bathrooms for ”partners” and “employees.” She’s been critical of Uber in the past.
It’s no question that tech stocks represent some of the world’s biggest companies. As our world and everyday lives are only becoming more and more tech dependent, this trend is likely to continue.Many of these stocks have been massive wealth generators over the years, with conquering household names such as Apple, Microsoft, and Amazon providing investors with incredible returns. But of course, there are other opportunities for the observant investor. The question is, where to find them?TipRanks’ set of unique tools is a sure-fire way to get on the right path. For example, the Stock Screener lets you filter your search results by price target upside, analyst consensus and sector so you can focus on only the most compelling investments.So, we rolled up our virtual sleeves and rummaged around to find 3 tech stocks set for gains ahead, specifically ones which currently have the Street’s undivided support. We mean to say that each has racked up only bullish recommendations in the last three months, making the consensus rating a unanimous “Strong Buy."Upland Software (UPLD)Enterprise software wiz, Upland, has been on a bit of a shopping spree. This year includes the 1H19 acquisitions of PostUp and Kapost, totaling $80 million. These were followed by the purchase of CIMPL for $23.1 million, and more recently the acquisitions of InGenius ($26.4 million) and the largest one to date, Altify ($84 million). An organic growth strategy is simply not the Upland way.The ever-expanding tech company also recently announced a new $190 million incremental loan which will go towards paying off its existing revolving credit facility, and yes, to fund more acquisitions.Craig-Hallum’s Jeff Van Rhee thinks “the Upland flywheel is in motion,” with the 5-star analyst adding, “This team is flat out executing and the model has legs for many years to come. Acquisitions are getting more strategic and cohesive product sets are emerging, particularly around customer care/customer engagement, a space we spend a lot of time covering and one that has improving tailwinds… We continue to believe this team will create substantial shareholder value near, intermediate, and long-term.”It’s no wonder, then, that Van Rhee’s call on UPLD remains a Buy. The 5-star analyst’s price target of $59 is set to provide excellent gains of 63% should it materialize. (To watch Van Rhee’s track record, click here)The analyst’s optimism is mirrored by that of the Street, as a full house of 5 Buys amongst the analysts tracked over the last 3 months gives UPLD a Strong Buy consensus rating. The average target price of $51.20 provides investors with upside potential of 41% from the price the stock is currently trading at. (See Upland stock analysis on TipRanks)Verint Systems (VRNT)A recent report by Accenture highlighted that cybercrime is poised to account for over $5 trillion of economic value over the next few years. Therefore, companies are set to be spending large chunks on services which provide IT security. The sector is a growing one, with innovative platforms emerging. Verint is one such platform with a two-pronged approach: cybersecurity and customer engagement management.The tech company is in the middle of a transition in both of its segments, moving to a cloud first strategy in the customer engagement segment, while also shifting away from a model that combines hardware and software to one whose sole focus is on selling software directly to customers.Needham’s Ryan MacDonald thinks the company is trading at a discount, noting, “Verint is still in the early innings of its model transition, which creates the potential for volatility in quarterly results. Given VRNT's discounted EV/EBITDA valuation of 8.8x our FY21 estimate, we believe the transition risk is priced into the stock, creating an attractive risk/reward profile for investors.”To this end, the 5-star analyst initiated coverage with a Buy rating and set a price target of $53. (To watch MacDonald’s track record, click here)Another analyst throwing in the hat is Goldman Sachs’ Brian Essex, who wrote, “While the company has been able to deliver modest growth and proﬁtability, the stock continues to trade at a meaningful discount to peers with similar fundamental proﬁles. We view the company well positioned to deliver ongoing growth and margin expansion and believe more consistent execution, more granular reporting, and an improvement in investor awareness will enable the stock to re-rate higher over time.”Essex’s Buy rating goes along with a price target of $58, putting the upside potential at 12% (To watch Essex’s track record, click here)The Street is on the same page in regards to the cybersecurity firm, as a Strong Buy analyst consensus for VRNT breaks down into a unanimous 5 Buys. The average price target of $62.40 provides a possible 21% increase from its current price. (See Verint stock analysis on TipRanks)Avalara (AVLR)It’s very hard to make anything to do with taxes sound remotely sexy, but at least Avalara humorously acknowledges this. On the tax compliance software provider’s website, the company describes itself as “disrupting the status quo in the ‘scintillating’ world of sales tax management since 2004.”It seems like the disruption, though, is bearing fruit. Avalara recently posted another strong quarterly report, with 42% subscription revenue growth (in line with the 42% last quarter), 38% calculated billings growth (near enough to the 41% growth last quarter despite harder comp), and 113% net revenue retention, the best in the company’s public history. It was also the 7th consecutive quarter of accelerating core customer additions.J.P. Morgan’s Sterling Auty smells opportunity, noting, “It was another impressive quarter with over 800 new customers added driving 6% upside in revenue and a significant margin beat. The tone on international growth and the new marketplace opportunities we believe add legs to the growth outlook as both can provide incremental opportunities beyond just what we have seen so far with the Wayfair decision. We think the stock still has room to move higher driven by these secular growth factors and a valuation that is below many other premium names.”Therefore, the 5-star analyst reiterated his Overweight rating on AVLR, along with a price target of $104, implying nice upside potential of 38%. (To watch Auty’s track record, click here)All in all, the 6 analysts tracked by TipRanks over the last 3 months all rate the taxman disruptor as a Buy, giving the stock a Strong Buy analyst consensus. The average stock-price forecast is $97.17, indicating gains of 29% could be in the cards. (See Avalara stock analysis on TipRanks)
Dec.08 -- Ziming Huang, managing partner and co-chief investment officer at HeirCastle Asset Management, talks about Chinese stocks. He speaks with Rishaad Salamat and Tom Mackenzie on "Bloomberg Markets: China Open."
David Klein, executive vice president and chief financial officer of Constellation Brands, will succeed Canopy Growth CEO Mark Zekulin on Jan. 14. The news ends a search that began in early July.
(Bloomberg) -- PG&E Corp. surged in early trading on the strength of a Friday announcement it had secured a $13.5 billion settlement with victims of wildfires ignited by its power lines, a step toward resolving the biggest utility bankruptcy in U.S. history.The agreement will cover claims stemming from some of the worst fires to hit Northern California, including the 2017 wine country fires and the 2018 Camp Fire, the company said in an email. The 2015 Ghost Ship fire and the 2017 Tubbs fire are also covered, though the utility doesn’t admit fault for either blaze, PG&E said. The shares rose as much as 31% before the start of formal trading in New York.The payout will be financed through cash, stock in a reorganized PG&E and monetization of net operating losses, according to attorneys for the victims. The deal must be approved by California Governor Gavin Newsom and the bankruptcy court. The pact is a win for PG&E, which has spent months trying to negotiate a plan to emerge from bankruptcy by mid-2020.The company also amended its restructuring support agreement to include an added pretax charge for victim claims of $4.9 billion for the quarter ended Dec. 31, according to a filing. And it extended the deadline for obtaining bankruptcy court approval for the agreement with insurers to Dec. 11 from Dec. 6.“From the beginning of the Chapter 11 process, getting wildfire victims fairly compensated, especially the individuals, has been our primary goal,” PG&E Chief Executive Officer Bill Johnson said in the statement. “We want to help our customers, our neighbors and our friends in those impacted areas recover and rebuild after these tragic wildfires.”U.S. Bankruptcy Judge Dennis Montali had ordered parties into mediation after settlement talks between victims and the company stalled.The utility has already agreed to pay $11 billion to insurers and investors, although that pact has been contested by the governor’s office, saying it locks claim holders into a restructuring plan that may not win approval. The company also has a deal to pay $1 billion to local government agencies.Resolving Major ClaimsPG&E said Friday that it will update and file its reorganization plan that resolves all major wildfire claims. The company said it is on track to gain the needed regulatory and court approvals to exit from bankruptcy by a state-imposed deadline of June 30, 2020.The utility said it had also received more than $12 billion in equity backstop commitments to support the settlement and its plan of reorganization.PG&E filed for Chapter 11 in January after its equipment was blamed for starting catastrophic wildfires in 2017 and 2018, burying it in an estimated $30 billion worth of liabilities.Compensating victims of wildfires has been the largest sticking point in PG&E’s restructuring. The company initially offered victims $8.4 billion, a fraction of what they said they were owed. A group of creditors -- led by Pacific Investment Management Co. and Elliott Management Corp. -- had offered to pay victims $13.5 billion as part of their rival reorganization proposal that won the support of the victims group.Newsom has threatened a state takeover if the utility failed to reach a deal with creditors and wildfire victims soon.Pressure to RestructureThe settlement with fire victims comes after PG&E drew outrage from state lawmakers and residents for carrying out deliberate mass blackouts to keep its power lines from igniting more wildfires during wind storms. In October, it plunged millions of Californians into darkness four times. The backlash increased pressure on Newsom to restructure PG&E.If approved, the settlement means PG&E will avert a trial scheduled to begin next month in San Francisco federal court to determine its liability from fire-related losses and estimate damages.“What makes the settlement significant is it creates a pathway to confirm a plan where you don’t have to go through extensive litigation,” said Eric Goodman, an attorney with the official committee representing wildfire victims.The cases of a group of victims of the Tubbs fire who were elderly or sick will remain scheduled for trial in January, attorney Mike Danko said. Such cases can’t be delayed more than 15 days, he said, adding that they could still be settled ahead of trial as part of the $13.5 billion deal. Danko represents fire victims but not those scheduled for trial next month.The settlement offers PG&E no relief from the scrutiny of a different federal judge overseeing its criminal probation stemming from the 2010 gas pipeline explosions in San Bruno, California. The Kincade fire in October has only intensified U.S. District Judge William Alsup’s aggressive inquiries about whether the utility has violated its probation by committing any federal, state or local crimes. PG&E remains under criminal investigation by the Butte County District Attorney for last year’s Camp fire.(Adds pretax charge, other detail in the fourth paragraph.)To contact the reporters on this story: Mark Chediak in San Francisco at firstname.lastname@example.org;Scott Deveau in New York at email@example.comTo contact the editors responsible for this story: Lynn Doan at firstname.lastname@example.org, Reg Gale, Pratish NarayananFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Mortgage rates didn’t budge much over the last week amid mixed signals as to the economy’s strength as the holiday season kicked into full drive. The 30-year fixed-rate mortgage averaged 3.68% during the week ending Dec. 5, unchanged from the previous week, Freddie Mac (FMCC) reported Thursday. Compared to a year ago, mortgage rates were more than a full percentage point lower.
Moscow’s energy policy made a sharp transition with two developments last week. pipeline taking gas from Russia to China was last Monday inaugurated by presidents Vladimir Putin and Xi Jinping, and marks a turn by Moscow to the east. Then, at the end of the week, Russian ministers attended the Opec meeting in Vienna and accepted that Russian production would be cut further as part of the cartel’s attempt to stabilise prices.
Washington do-goodism almost always fails to help the people it is supposed to because politicians ignore the Law of Unintended Consequences.
Our call of the day from wealth manager Ross Gerber takes a look at a home-run stock-pick in 2019 and some possibilities for the coming year.
U.S. state attorneys general, led by New York and California, deliver opening arguments Monday in a bid to stop T-Mobile U.S. <TMUS.O> from buying Sprint Corp <S.N> in a trial that highlights disagreements between federal antitrust enforcers, who are Republican, and Democrats in powerful states. Attorneys for the 13 states and the District of Columbia will argue in Manhattan federal court that a plan to combine the No. 3 and No. 4 wireless carriers would push up prices, particularly for users of prepaid plans. The state officials, all Democrats, asked Judge Victor Marrero to order the companies to abandon the deal.
China is ramping up recruitment of Taiwanese talent in semiconductors, attracting top executives and engineers alike to bolster an industry that the US trade war has shown to be a Chinese Achilles heel. The aggressive campaign has sparked concerns about a brain drain in Taiwan’s chip industry, which is struggling to compete with generous offers by cash-rich mainland companies. One man in his 50s left a longtime job at a leading Taiwanese semiconductor maker a year ago for a position on the mainland.
Merck & Co. Inc. said Monday it has entered an agreement to acquire ArQule Inc. for $20 a share in cash or an equity value of about $2.7 billion. The deal is expected to close in the first quarter of 2020 and to boost Merck's oncology pipeline. ArQule's lead investigational candidate, ARQ 531, is a novel, oral Bruton's tyrosine kinase (BTK) inhibitor currently in a Phase 2 dose expansion study for the treatment of B-cell malignancies. ArQule shares rose more than 100% on the news in premarket trade, and have gained 249% in 2019 through Friday, while the S&P 500 has gained 25%.
What’s always in style on the Street? Growth. Investors are constantly window shopping on Wall Street to pinpoint the names that represent the crème-de-la-crème when it comes to the ability to post long-term gains. This makes sense as growth leads to profits, which in turn can lift share prices.However, given the market’s record breaking performance in 2019, it isn’t always easy to spot the stocks poised to climb higher and yield handsome returns in the years to come. That’s where the analysts can help. Using the Stock Screener tool from TipRanks, we were able to zero in on 3 stocks with stellar long-term growth narratives backed by Wall Street analysts. We’re talking about enough support to earn a “Strong Buy” consensus rating here. If that wasn’t enticing enough, all of the names boast at least 20% upside potential from the current share price. Here’s the scoop. Alphatec Holdings, Inc. (ATEC)This med tech company has disrupted the market with its innovative products for the surgical treatment of spine disorders. After skyrocketing 193% since the start of the calendar year, analysts are betting that ATEC can continue its impressive run in 2020.Part of the bullish sentiment surrounding the company is due to its strong Q3 performance that sped past the revenue consensus estimate. ATEC reported that quarterly revenue hit $29.2 million, surpassing the $26.4 million estimate. Management pointed to the domestic strategic distribution segment, which was up 52% in the quarter, as the driver here. Not to mention full year revenue guidance was bumped up from $104 million-$109 million to $109 million-$112 million. While Lake Street’s Brooks O'Neil notes that some drag from terminated distributor relationships and from legacy products remains, ATEC has made a significant effort to turn things around. “Specifically, Pat Miles, CEO and his team are spine experienced and taking significant steps to strengthen the Company's distributor relationships (key in spine) and to revitalize its product line…While we recognize there remains work to be done, we are absolutely convinced this team will complete the job,” he explained. The analyst adds that its product lineup lends itself to ATEC’s strong position in the $7 billion U.S. spine market. “We believe the market is ripe for innovation and ATEC is targeting complex spine procedures, minimally invasive surgeries and biologics, collectively the fastest growing segments of the market,” he commented. Specifically, O’Neil cites ATEC’s SafeOp platform, it’s technology that eliminates the need for a technician or other neuromonitoring professional to monitor the risk of nerve injury during spinal surgeries, as especially promising. Taking all this into consideration, the four-star analyst kept the rating as a Buy and boosted the price target from $7 to $10. At this updated target, shares could jump 49% in the next twelve months. (To watch O’Neil’s track record, click here)Similarly, the rest of the Street takes a bullish approach when it comes to ATEC. Given the 4 Buys and no Holds or Sells assigned in the last three months, the consensus comes in unanimously as a Strong Buy. On top of this, the $9 average price target indicates 30% upside potential. (See Alphatec stock analysis on TipRanks) Telaria Inc. (TLRA) As Telaria has already achieved 202% growth year-to-date, the Street is watching the video content software company very closely. While shares dipped after management left its forecast for 2019 revenue unchanged, some members of the Street argue that TLRA still has a lot going for it. Its connected TV (CTV) business increased a whopping 115% year-over-year and boasts margins in the high-80% range. As a result, Stephens analyst Kyle Evans believes that this segment can take TLRA to new heights. “We believe rapidly changing consumer behavior combined with numerous, new AVOD product launches will create a large ad-supported CTV market, where TLRA’s leading, independent CTV tech platform will continue to grow rapidly,” he wrote in a note to clients. Bearing this in mind, he maintained the Overweight recommendation as well as the $11 price target, implying 33% upside. (To watch Evans’ track record, click here)Meanwhile, Lake Street’s Mark Argento highlights recent publisher wins and its continued innovation as making TLRA a stand-out despite soft gross margins. The company racked up deals in the quarter that included Crown Media and Plex TV in the U.S., its first deal in Japan with a leading broadcaster, three large publishers in Canada and a large consortium of Australian publishers. Additionally, TLRA unveiled Audience Connect, its new group of addressable audience-based buying solutions as well as new features to improve transparency and communications. Based on these factors, Argento stayed with a Buy rating and an $11 price target, the same as Evans’ estimate. (To watch Argento’s track record, click here) All in all, other Wall Street analysts are on the same page. With 100% Street support, the message is clear: TLRA is a Strong Buy. The Street does however see a bit less upside potential, 25% to be exact. (See Telaria stock analysis on TipRanks) Crocs, Inc. (CROX)The famous foam shoe designer has been impressing analysts left and right ahead of the holiday shopping season.Mitch Kummetz of Pivotal Research was surprised by the degree in which Crocs was able to beat the estimates for third quarter sales and EPS. During the quarter, sales reached $313 million, exceeding the $302 million consensus estimate. EPS flew past the 40 cent Street forecast, coming in at 57 cents. “In short, the company won’t quantify its spring prebooks, but we suspect they’re even stronger than we had previously anticipated, as retailers are allocating a lot more of their open-to-buy to Crocs clogs in particular,” the analyst stated. This prompted him to not only reiterate his bullish call but also raise the price target by $5 to $44, suggesting 24% upside potential. (To watch Kummetz’s track record, click here)Like Kummetz, Piper Jaffray analyst Erinn Murphy likes what she’s seeing, citing Crocs as one of her favorite Holiday ideas. Jibbitz, or charms to accessorize the company’s shoes, offer a wealth of opportunity according to Murphy. “All in, we see 14% EBIT margin by 2021 (vs. our current 13.5%) as plausible if Jibbitz momentum continues. We have observed Jibbitz at retail partners in store and online in recent weeks and believe broader distribution could meaningfully accelerate charm penetration in the coming quarters,” she noted. The analyst also tells investors that U.S. search trends have reaccelerated quarter to date, with its collaboration with artist Post Malone still on the horizon. Based on statements from the CMO, the launch could be the company’s largest ever. To this end, the analyst maintained the Overweight rating and $44 price target. (To watch Murphy’s track record, click here) The rest of the Street appears to echo the two analysts’ sentiment. 4 Buys and 1 Hold add up to a Strong Buy consensus rating. In addition, the $43 average price target brings the potential twelve-month gain to 20%. (See Crocs stock analysis on TipRanks)
Futures: The stock market rally and China-tied Apple, AMD and Alibaba await President Donald Trump's China trade war decision on Dec. 15 tariffs.