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Palm, Inc. (NASDAQ: PALM) has sort of already fallen from grace despite all the hype behind the Palm Pre. Throw in that Pixi too. Discounting is trumping what may be weaker sales. It turns out that Amazon.com (NASDAQ: AMZN) is offering the Palm Pre for Sprint for a mere $79.99. Sprint Nextel (NYSE: S) has it offered direct at $149.99 price after discounts and rebates at its site. Sprint Nextel is also selling the Palm Pixi for $99.99, but the Palm Pixi is now for sale for $24.99 at Wal-Mart Stores (NYSE: WMT). We confirmed all these prices on the websites, and this is going to confirm tough times for Palm and its finances.
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Posts related to ‘Consumer Electronics’
The Palm Margin Squeeze (PALM, S, AMZN, WMT)
24/7 Wall St. TV: Sony e-Reader To Ship Late Adding To Company Woes
The management at Sony (NYSE:SNE) looks more and more like “The Gang That Couldn’t Shot Straight.” Its TV screen business is losing money. Most months, sales of the PS3 fall behind those of the Microsoft (NYSE:MSFT) Xbox 360 and Nintendo Wii.
Sony appears to have a promising new product in its Daily Edition Reader, the company’s e-reader offering. The device puts it into competition with market leader Amazon (NASDAQ:AMZN) and its popular Kindle, but Sony still have the consumer electronics brand power to give it a reasonable change to be a force in the e-book industry.
It would be nice if Sony could get its product out for the holidays. Read More
California Plans To Ban Some Energy-Hungry TVs
The State of California claims that as much of 10% of the region’s electricity is used by televisions. The state government is considering setting standards for TV energy consumption that would push 25% of the sets now made out of the market in 2013.
According to the AP, “Industry representatives have said the standards would force manufacturers to make televisions that have poorer picture quality.” Read More
Sony (SNE) Throws Cold Water On The Holidays
Sony (NYSE:SNE) expects its holiday sales to be poor. That is terrible news for the consumer electronics and PC industries. Sony is a nearly perfect proxy for those sectors. It sells PCs, video games, TV screens, and digital cameras. Many of Sony’s competitors will have to gird for another harsh holiday selling season, unless the forecast from the big Japanese firm is based on a large drop in market share across most of its businesses.
Sir Howard Stringer, Sony’s CEO, was quoted by Reuters as saying “There hasn’t been that turning point that many had hoped for. We are waiting for a signal that hasn’t arrived.” Read More
Tech Giants Now Hold ~$265 Billion Cash To Spend (HPQ, COMS, INTC, AMD, MSFT, CSCO, AAPL, GOOG, ORCL, JAVA, QCOM, EMC, YHOO, DELL, AMZN, EBAY, ONT, BRCD, JDSU, STAR, VMW)
You have already seen the Hewlett-Packard (NYSE: HPQ) buyout of 3Com Corporation (NASDAQ: COMS). But this week before that deal was announced we covered how mergers in the technology sector have been very slow to develop over the scale in which we and others think is possible for the sector. After the Intel Corporation (NASDAQ: INTC) settlement with Advanced Micro Devices (NYSE: AMD), the tally of cash that is now estimated would be an implied $265 billion that is available for the tech giants in our 24/7 Wall St. Real-Time 500 to make acquisitions.
The giant cash balances are held by Microsoft Corporation (NASDAQ: MSFT), Cisco Systems Inc. (NASDAQ: CSCO), Apple Inc. (NASDAQ: AAPL), Google Inc. (NASDAQ: GOOG), and Oracle Corp. (NASDAQ: ORCL), assuming nothing happens with Sun Microsystems Inc. (NASDAQ: JAVA). But players like QUALCOMM Inc. (NASDAQ: QCOM), EMC Corporation (NYSE: EMC), International Business Machines (NYSE: IBM), Dell Inc. (NASDAQ: DELL), Yahoo! Inc. (NASDAQ: YHOO), Amazon.com Inc. (NASDAQ: AMZN), and eBay Inc. (NASDAQ: EBAY) are either all sitting with large amounts of cash or will be very soon.
We have broken out these technology, IT, software, and Internet companies by the cash amount they hold or what they have in a soon-to-be cash balance. Of course only a fraction of this cash will be used for mergers. But there is also a ton of room here for dividends and of course the share buybacks.
Tech Titans Still Have $269 Billion Cash For Deals (MSFT, CSCO, AAPL, GOOG, INTC, HPQ, QCOM, EMC, VMW, YHOO, DELL, ORCL, JAVA, AMZN, EBAY)
The recovery is on and mergers are happening, yet the technology sector has been slow to make deals. Despite some deals already having taken place from the technology giants and that $260 billion cash balance which was there in the middle of last quarter is even larger now. The tally for cash by our count is now right around $269 billion. We looked through the top market caps of technology companies in our 24/7 Wall St. Real-Time 500 and this list is expanded now that some issues have been resolved in all the companies. The stocks in this group are Microsoft Corporation (NASDAQ: MSFT), Cisco Systems Inc. (NASDAQ: CSCO), Apple Inc. (NASDAQ: AAPL), Google Inc. (NASDAQ: GOOG), Intel Corp. (NASDAQ: INTC), Oracle Corp. (NASDAQ: ORCL), Sun Microsystems Inc. (NASDAQ: JAVA), Hewlett-Packard Company (NYSE: HPQ), QUALCOMM Inc. (NASDAQ: QCOM), EMC Corporation (NYSE: EMC), International Business Machines (NYSE: IBM), Dell Inc. (NASDAQ: DELL), Yahoo! Inc. (NASDAQ: YHOO), Amazon.com Inc. (NASDAQ: AMZN), and eBay Inc. (NASDAQ: EBAY).
These few tech companies with the $269 billion cash that could be deployed for mergers, acquisitions, or the good old dividends are also listed before tallying up credit lines, factoring, debt sales, and other creative financing methods. We have listed the suppositions and counting methods for each one to illustrate how much is available at each company.
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TeleNav Files For IPO, Maybe Too Late (TNAV, GOOG, GRMN, S, T)
If you watched any news this week about Google Inc. (NASDAQ: GOOG) launching a free personal navigation service on its Android phones, then you know it was a bad week for Garmin Ltd. (NASDAQ: GRMN). This wasn’t even really unknown news, although the timing caught many by surprise. And now most IPOs coming to market are getting sold and not bought. So if I were to tell you that a company called TeleNav, Inc. whose first line of their own description said “We are a leading provider of location-based services, or LBS, including voice guided navigation, on mobile phones” filed to come public via an Initial Public Offering the question is: what would you think?
If you can believe it, that is just what happened late Friday afternoon. No terms were issued, but TeleNav did say that it plans to sell up to $75 million for filing purposes. No exchange was listed and the company plans to trade under the stock ticker “TNAV” after the IPO.
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Is Google’s Navigation Launch A Category Killer? (GOOG, TRMB, GRMN)
Google Inc. (NASDAQ: GOOG) and its ‘new’ navigation via Google Maps Navigation is putting the hurt on the GPS competitors. Trimble Navigation (NASDAQ: TRMB) posted income of $15.6 million, a 60% drop, in its quarterly profits yesterday and revenue was down 18% to $269.7 million. Unfortunately, the guidance was under expectations. And shares are only down 0.2% at $21.25 after recovering from morning lows. Garmin Ltd. (NASDAQ: GRMN) is getting clipped far worse as the ‘launch’ from Google seems to be a direct assault on its model, and Garmin’s earnings are just a week away. Today’s only real shock may be in the timing of the launch.
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Credit & Equity Analyst Ratings Duel at Palm (PALM)
Palm Inc. (NASDAQ: PALM) has lost that massive stock surge that we saw for what felt like way too long throughout 2009. There are two key analyst calls that now may act as an analyst duel. One is yesterday’s BMO Capital Markets and the other is non other Standard & Poor’s. Throw in a high, but declining, short interest and the race is back on in Palm as to whether its future is made of shinola or made of something else in the notorious analogy.
Palm was weak yesterday and fell $0.90 to downgraded yesterday to $13.38 after BMO Capital Markets downgraded the stock to an “Underperform” rating from an already neutral “Market Perform” rating. BMO already took its sub-market target down to $10.00 from $11.00. BMO was concerned over Apple’s iPhone and R-I-M’s Blackberry competition, as well as what is coming down the pipe from Google’s Android phones. Yet this morning we have an upgrade on the corporate credit side of Palm from Standard & Poor’s.
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Google’s (GOOG) Android Could Squeeze Out Apple (AAPL)
Nokia’s (NYSE:NOK) Symbian mobile operating system has dominated the handset software business for years. Microsoft’s mobile Windows has made some progress in picking up market share during the last decade, but its success has been very modest.
The operating systems which are part of the Apple (NASDAQ:AAPL) iPhone and RIM (NYSE:RIMM) Blackberry were almost instant successes because of the popularity of their handsets.
Among these four powerful mobile OS players there seemed to be no room for a fifth, and certainly not a fifth that could take any significant market share. Google’s (NASDAQ:GOOG) is in the process of proving that conventional wisdom wrong. Read More
Could Apple (AAPL) End Up With 1,000 Retail Stores?
Analysts are constantly speculating about what Apple (NASDAQ:AAPL) will do with its $25 billion in cash. The company has no track record of buying back shares or issuing a dividend. Apple rarely buys other firms and when it does, the transactions are small.
Apple has 300 retail stores worldwide and Global Equities Research thinks that number will go to 1,000. The question is “why”? There are a number of good answers. Read More
The Rise Of The Kindle And The Fall Of Literacy
Jeff Bezos, the founder of Amazon (NYSE:AMZN), is being praised as the man who has invented the next big and important electronic device. That category includes the Sony (NYSE:SNE) PS2, the Apple (NASDAQ:AAPL) iPod, and the Nintendo Wii. The iPod has sold 200 million units worldwide. That, in the nomenclature of the electronics industry, makes it a once in a generation success, a truly mass market product. Read More
Amazon (NASDAQ:AMZN) Slashes Kindle Price, Goes Global
Forrester Research recently completed a survey of 5,000 Americans in which it asked about the amount people would pay for e-book readers. Most respondents said they would not spend more than $100. That was bad news for Amazon (NASDAQ:AMZN) which has hoped to make its Kindle a mass market product. The Kindle sells for $299.
The e-commerce company went a long way toward solving its price problem by slashing the retail cost of the Kindle in the US to $249. Amazon will also begin to market the product in a number of countries around the world trying to push sales to levels well above most predictions. Read More
The Week of Proof for A123 (AONE, CBAK, ABAT, CSGH, BRK-A, GE, QCOM, MOT, AB, PG)
A123 Systems Inc (NASDAQ: AONE) is still likely going to be one of the highlights of trading activity for the week, but the valuation is all based on the future rather than on the performance of the past. The maker of lithium-ion car batteries turned out to be the second best IPO of 2009 in the United States, so the company’s execution from here is paramount. That is what a 50% gain on the first day will do for you. The deal was for 28.1 million shares at $13.50, although it opened at $17.00 and it never went below $16.56 in the aftermarket.
While a highlight is one thing, A123 has competition and its losses are off the chart. China Bak Battery, Inc. (NASDAQ: CBAK) and Advanced Battery Technologies, Inc. (NASDAQ: ABAT) are in the space but have far less hype.
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Tech Titans Holding $260 Billion In Cash (DELL, PER, ORCL, JAVA, MSFT, AAPL, IBM, GOOG, CSCO, INTC, HPQ, QCOM, EMC, YHOO)
The economy is obviously getting better, so long as you are not one of the unemployed or about to lose your job. Now with more than a 50% rally from the March lows and a Dow Jones Industrial Average challenging the 10,000 level, suddenly everyone wants to put on their investment banker hats again and look for buyers and buyout candidates after deals are announced. This week’s Dell Inc. (NASDAQ: DELL) deal for Perot Systems Corp. (NASDAQ: PER) was a $3.9 billion acquisition versus $12.7 billion in cash and equivalents held at the end of the quarter. The Oracle Corp. (NASDAQ: ORCL) deal for Sun Microsystems Inc. (NASDAQ: JAVA) is valued at $7.4 billion, or $5.6 billion net of Sun’s cash and debt. We went back through our list from September 2, 2009 where we noted that outside of the financials in the 20 largest US companies had a cash hoard of $335 billion that could be used for mergers and acquisitions, and that is not accounting for lines of credit, stock or debt that could be sold, and other means of financing a deal. While nowhere near all of the cash will ever be used, many companies could pay big dividends before any tax changes.
So we wanted to look through the technology sector and after we looked through the top 100 markets caps in our 24/7 Wall St. Real-Time 500 we added a few new additions in the tech sector that still had over $5 billion in cash. Out if the $335 billion from those in the top twenty, we broke out Microsoft Corporation (NASDAQ: MSFT), International Business Machines (NYSE: IBM), Apple Inc. (NASDAQ: AAPL), Google Inc. (NASDAQ: GOOG), Cisco Systems Inc. (NASDAQ: CSCO), Intel Corp. (NASDAQ: INTC), Oracle Corp. (NASDAQ: ORCL). Even after a huge rally, $335 billion and then some could go a very long way for strategic and bolt-on acquisitions as a positioning strategy for the next decade. Now, going further down the list of the top 100 companies with $5 billion or more in cash from tech companies alone adds in Hewlett-Packard Company (NYSE: HPQ), QUALCOMM Inc. (NASDAQ: QCOM), EMC Corporation (NYSE: EMC), and Yahoo! Inc. (NASDAQ: YHOO). When we tally up all the cash, there is over $260 billion available from these few tech companies that could be deployed for mergers, acquisitions, or the good old dividends. Again, that is before tallying up credit lines, factoring, debt sales, and other financing methods.
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Palm Boosts & Prices Secondary Offering (PALM)
Palm, Inc. (NASDAQ: PALM) has priced its public secondary offering of 20 million shares at a price of $16.25 per share. This is a fter a $17.07 close yesterday. Palm noted that it will have 162,329,477 shares outstanding after the offering, excluding shares from the over-allotment option if exercised.
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Sirius XM (SIRI) Gets Nasdaq Warning On Stock Price
Sirius XM (SIRI) faces a possible delisting from the Nasdaq, according to a disclosure by the company. The firm’s common stock closed below $1.00 per share for 30 consecutive business days. That violates the Nasdaq Marketplace Rule 5450(a)(1).
Sirius has until March 10, 2010 to fix the problem. The issue disappears if the firm’s stock closes above $1 for 10 consecutive trading days.
Sirius is not left with many options. Its shares trade at $.69 and there is every reason to believe that if the company does not have extraordinary earnings for the third or fourth quarters that the stock will stay near where it is. Read More
Palm Stock Sale & Short Interest Trump Earnings (PALM)
Palm Inc. (NASDAQ: PALM) is out with earnings, although the key is going to be what the interpretation is over its Palm Pre sales. The GAAP loss was huge, but the non-GAAP loss was only -$0.10 EPS. The company said that non-GAAP adjusted revenues were $360.7 million. Its non-GAAP adjusted gross profit was $100.6 million and non-GAAP Adjusted Gross Margin was 27.9 percent. Thomson Reuters had a consensus reading of $-0.24 for non-GAAP EPS and $297.7 million in revenues. This is huge on the surface, but PALM also announced a huge secondary offering.
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In A123 Battery IPO, Buffett Indirectly Wins (AONE, BRK-A, GE, QCOM, MOT, SCMR, AB, PG, AAPL)
Next week is still supposed to mark the initial public offering of what me be a very hot IPO. Auto electric-battery maker A123 Systems Inc. is tentatively set to launch and begin trading mid-next-week under the stock ticker “AONE” on NASDAQ. We have penciled in a date of September 23 or 24, but if you have been watching IPOs for years you know that date can change. This one has been in the IPO hopper almost forever as the IPO filing date was in August 2008.
We’ll get to this a little later, but we did note in the title that Warren Buffett and Berkshire Hathaway Inc. (NYSE: BRK-A) may be the indirect winner here in this offering. A123 raised a fairly recent round led by General Electric Co. (NYSE: GE) and affiliates, which has a 11.7% stake. At the time the company filed to come public it has raised roughly $160 million and it has large stakes held by venture capital firms (North Bridge, Sequoia and others), Qualcomm Inc. (NASDAQ: QCOM) has a 7.6% stake and Motorola Inc. (NYSE: MOT) has a 6.9% stake. Gururaj “Desh” Deshpande, the co-Founder and Chairman of Sycamore Networks, Inc. (NASDAQ: SCMR), also has a 9.9% stake. AllianceBernstein Holding L.P. (NYSE: AB) and Procter & Gamble (NYSE: PG) are also listed under the investors of the company.
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Major Earnings on Deck This Coming Week (ADBE, BBY, KR, ORCL, DFS, FDX, PALM, PIR, JAVA)
We have a little flurry of key earnings coming this week. We have provided detailed earnings estimates with Thomson Reuters consensus figures, with our own color for the recent performance, the charts, options, and other critical data when and where it stood out. The companies covered are Adobe Systems Inc. (NASDAQ: ADBE), Best Buy Co. (NYSE: BBY), The Kroger Co. (NYSE: KR), Oracle Corp. (NASDAQ: ORCL), Discover Financial Services (NYSE: DFS), FedEx (NYSE: FDX), Palm, Inc. (NASDAQ: PALM), and Pier 1 Imports, Inc. (NYSE: PIR).
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