The DVD business is bad. Video-on-demand, available on most cable systems, and internet streaming of premium content have cut into one of the largest profit centers in Hollywood.
Viacom’s (VIA) Paramount studio operation is looking for a partner for its home entertainment unit, which produces and sells DVDs, in the hope of cutting costs. The most logical marriage of that business would be to another studio which faces that same problem with eroding margins. Read More
Reuters: The heads of the emerging markets, the so-called BRICs, held their first global summit.
Reuters: Obama will be tested this week on financial reforms.
Reuters: Rich nations are working on an exit from stimulus packages.
Reuters: Pfizer (PFE) is trying to do deals to improve its emerging market presence. Read More
Facebook recently took in a new $200 million investment which puts the value of the company at $10 billion. That is down from a $15 billion valuation based on an investment that Microsoft (MSFT) made in the social network site in the fall of 2007. Most industry estimates are that Facebook will lose money on revenue of $500 million this year. News Corporation’s (NWS) purchase of MySpace and several smaller sites for $580 million in 2005 is still considered a coup, although MySpace revenue is less than $1 billion and it is losing ground to Facebook. Read More
Sony (SNE) is in trouble, and it is very deep trouble. For the fiscal year ending March 31, the conglomerate lost more than $1 billion on $79 billion in revenue. Sales were down by over 12% Read More
Reuters: Rio Tinto (RTP) has killed a deal with Chinalco for one with BHP (BHP).
Reuters: US regulators insisted JP Morgan (JPM) and Amex (AXP) raise money to exit the TARP.
Reuters: Countrywide’s Mozilo was charged with fraud.
Reuters: The suspense is building ahead of one of Apple’s (AAPL) big annual events. Read More
Micro-blogging platform Twitter has 32 million users, which is an increase from about 2 million a year ago, according to research mentioned in The Wall Street Journal. Some Internet measurement services show that figure increasing 50% to 100% month-over-month. While it is not clear that Twitter will become as large as social networks, MySpace and Facebook or video-sharing site YouTube, the company could certainly have 50 million visitors by the end of the year. Read More
Sir Howard Stringer is the first non-Japanese to run Sony (SNE) and putting him into the job was probably a mistake. He was promoted to “re-invent” the company. Instead, he has done what most chief executives without imagination do by cutting thousands of jobs.
The cost reductions did not keep Sony from losing $1 billion in the fiscal year that ended on March 31. Sony forecast another loss for this year. Read More
According to Reuters, lenders will object to the Chrysler Chapter 11 filing.
Reuters reports that Switzerland is asking US a court to halt a case against UBS (UBS).
Reuters reports that SMFG will buy Citiroup’s (C) Japan units for over $5.6 billion.
Reuters writes that Cuomo said that pension kickbacks are a national problem. Read More
These are the top analyst downgrades and cautious calls we have seen from Wall Street analysts this Monday morning:
American Tower (AMT) Cut to Sector Perform at RBC.
AXA (AXA) Cut to Underweight at JPMorgan.
Blue Nile (NILE) Cut to Hold at Citigroup.
CA Inc. (CA) Cut to Hold at Jefferies.
FactSet (FDS) Started as Sell at Auriga.
IBM (IBM) Cut to Hold at Canaccord Adams.
Interactive Brokers (IBKR) Cut to Underperform at KBW.
IntercontinentalExchange (ICE) Cut to Underperform at KBW.
Novell (NOVL) Cut to Hold at Jefferies.
SBA Communications (SBAC) Cut to Sector Perform at RBC.
Viacom (VIA) Cut to Equal Weight at Barclays.
JON C. OGG
Internet display advertising is being challenged by the recession. Traditional media is not the only business being hurt as marketers curtail spending to save money.
Barry Diller recently said that the display advertising at the sites his company controls was down 50% in January. Read More
These are some of Tuesday morning’s top pre-market upgrades and downgrades we have seen from Wall Street analysts with more than two hours until the open:
Jon C. Ogg
February 3, 2009
These are some of the top pre-market analyst downgrades we have seen early this Friday morning:
Jon C. Ogg
January 16, 2009
According to Reuters, Wall St. closed its worst year since The Depression.
Reuters reports that GMAC did not hit its goal of trading debt for equity and cash.
Reuters reports that GM (GM) has gotten $4 billion of its bailout money but cash to Chrysler has not been received.
Reuters reports that senior officers at Citigroup (C) will not get bonuses.
A Bloomberg review of the S&P 500 stocks shows that the fourth quarter of 2008 will probably be the sixth quarter of declining earnings. According to the news service, "Fourth-quarter profit at companies in the Standard & Poor’s 500 Index may have dropped an average of 11.9 percent from a year earlier."
That may be a useful look at the past, but the movement of the stock market is going to be based on expectations for the first quarter of 2009.
New data released by comScore shows that US internet users watched more than 15 billion videos last month. Almost 40% of those were watched on Google (GOOG) sites, most of them on YouTube. The search company as much as admits that it has not come up with a way to make money on this business. It is not clear that is different for any of the other large online firms which offer large libraries to consumers.
According to Reuters, car company executives went before Congress and pleaded for billions of dollars.
Reuters reports that governments are bracing for a long crisis ahead.
Reuters reports that Paulson says the financial bailout still faces hurdles.
Reuters writes that oil is steady below $44.
The bad ad environment will catch up to Time Warner (TWX) in a flash. Viacom (VIA) had only just indicated that the markets for advertising sales were dismal. Now TWX is slashing its forecasts.
Time Warner expects to incur certain restructuring charges this year. For the nine months ended September 30, 2008, the Company has incurred approximately $182 million in charges.
In light of these restructurings, which are now expected to total $280 million to $310 million for the year, as well as the challenging economic environment facing certain businesses, Time Warner now anticipates that full-year growth rate in adjusted operating income before depreciation and amortization will be around 5%, off a base of $12.9 billion in 2007. This compares to the outlook provided on February 6 of a range of 7% to 9%. It also cut cash flow projections.
On the earnings side, Time Warner said EPS will be $1.04 to $1.07, down from the firm’s prior outlook of $1.07 to $1.11.
For the third quarter, revenue rise a fraction to $11.7 billion. Operating income was also up modestly to $2.4 billion The firm beat most Wall St. forecasts.
The only units with strong performances were the company’s cable and networks operations. Cable revenue was up almost 10% to $4.3 billion. Networks rose about 5% to $2.7 billion.
According to Reuters, Obama won the race for US president
Reuters reports that stock index futures were steady after the Obama win.
Gareth Roberts, CEO of Denbury Resources (NYSE:DNR) was forced to sell 513,000 shares of the company’s stock to meet a margin call "pursuant to a real estate based loan." That was about 15% of his holdings. This is not at all the first CEO in this boat, and it isn’t just smaller company CEO’s caught up in the margin call mayhem.
According to Reuters, former Citigroup (C) CEO Sandy Weill may start a fund to invest in distressed financial companies.
Reuters writes that Amazon (AMZN) turned in a weak forecast hurting its stock.
Reuters reports that weak economic data in Japan lead to more recession fears
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