Trefis Helps You Understand How a Company's Products Impact Its Stock Price
COMPANY OF THE DAY : FACEBOOK
Facebook is scheduled to price its monster IPO later this week after increasing the size of the deal and raising the pricing range to $34-38, implying a valuation that could surpass $100 billion.
Tuesday GM didn't help matters when it reported that its pulling some of its advertising from Facebook given a lack of results.
See Complete Analysis for Facebook
Tuesday GM didn't help matters when it reported that its pulling some of its advertising from Facebook given a lack of results.
See Complete Analysis for Facebook
FORECAST OF THE DAY : VISA'S INTL. TRANSACTION VOLUME
Visa showed strong international growth in its recent earnings.
In Brazil, Visa continues to charge ahead and reached a new agreement to brand 50% of a large Brazilian bank's cards. In addition Asia-Pac and CEMEA delivered 16% growth in the latest quarter.
Visa's plans for half of its revenue to come from international geographies by 2015.
Read more...
In Brazil, Visa continues to charge ahead and reached a new agreement to brand 50% of a large Brazilian bank's cards. In addition Asia-Pac and CEMEA delivered 16% growth in the latest quarter.
Visa's plans for half of its revenue to come from international geographies by 2015.
Read more...
RECENT ACTIVITY ON TREFIS
MDU Resources: Customer Growth Highest in the Industry
Submitted by Investing Daily as part of our contributors program . By: Roger Conrad MDU Resources (NYSE: MDU) generates a third of its earnings from oil and gas production. The focus is output from 124,000 acres in the Bakken region, supplemented by properties in the Heath Shale (Montana), Paradox (Utah) and Niobrara (Wyoming) formations. Management is targeting a 20 percent to 30 percent boost in oil output for 2012. Construction services and materials production contribute about a quarter of profit. The recession hit this business particularly hard, but it’s recovering thanks to the need for infrastructure to support drilling in the Bakken .
Groupon Launches Rewards, Loyalty Program for Local Merchants
Groupon (NASDAQ:GRPN) announced the nationwide launch of Groupon Rewards, a loyalty program for local merchants which enables them to offer their customers special rewards and offers for repeat business. Customers can earn Groupon Rewards by using any credit card saved in their Groupon profile when they make a purchase. Once they spend above a certain limit, they automatically get an offer or reward for their next purchase. This makes it easy for them to collect and redeem rewards without any extra apps or loyalty cards.
A Look at the Basics of Gas Processing and the Growth Trends at Work in this Market
Submitted by Investing Daily as part of our contributors program . By: Elliott Gue In the field, raw natural gas often occurs with other hydrocarbons such as ethane, propane, butane and iso-butane. These heavier hydrocarbons are collectively known as natural gas liquids (NGL). Processing involves separating the NGLs from the raw gas, which ensures that the methane (natural gas) meets purity requirements for transportation on the interstate pipeline network and delivery to homes and businesses. More important, NGLs have value as discrete commodities ; the relative spread between the price of natural gas and a barrel of NGLs drives demand for processing. That is, if natural gas prices are low compared to the price of a barrel of NGLs, companies have an incentive to extract as much of this content as possible from the raw gas. Conversely, if gas prices are expensive relative to NGLs, demand for processing would suffer. In this instance, companies would leave as much NGLs as possible in the gas stream without violating pipeline requirements.
SAP Reaches For $71 Taking Small Business Solutions To The Cloud
SAP All-in-One is SAP ‘s (NYSE:SAP) business software brand for small and medium sized enterprises. It includes a range of products like SAP CRM, SAP ERP, SAP Product Lifecycle Management, SAP Supply Chain Management, SAP Supplier Relationship Management, SAP Human Resources and SAP Financial Management. The company has now certified this application for cloud-based deployments on Amazon Web Services (AWS) and will run on both Windows and Linux-based instances. It competes with players such as Oracle NASDAQ:ORCL), Salesforce.com (NYSE:CRM), IBM (NYSE:IBM), and Microsoft (NASDAQ:MSFT).
Starbucks' Asian Growth Faces A Tough Road Ahead
It would be wrong to assume that Starbucks Corporation ‘s (NASDAQ:SBUX) expansion in Asia would be a runaway success without any obstacles as pricing issues combined with intense competition can pose a threat to the company’s long term profitability. Moreover, these factors will impact long term trends for the business, which we rely on to make long term estimates for its valuation. Starbucks has outperformed the markets in 2012 but has lost more than 10% since reaching its record high in April. Starbucks’ competitors in the broader market for coffee include McDonald’s (NYSE:MCD), Caribou Coffee (NASDAQ:CBOU) and Dunkin’ Brands (NASDAQ:DNKN). We have a Trefis price estimate of $55 for Starbucks, which is in line with the market price. See full analysis for Starbucks here Pricing Issues In South Korea, Starbucks increased the prices of its 32 drinks by 300 Won or $0.27 from May 7. The move was unpopular in the country and it has faced consumer backlash. The company also plans to double the number of restaurants in the country to 700 by the end of 2016. Unlike most of its western counterparts, the menu prices of Starbucks in developing markets are on par with (or sometimes even more expensive) those in the U.S. Pricing is a major issue, especially in developing markets, since they exhibit a higher negative price elasticity. In other words, a slight price increase will deter a significant number of customers. With prices of its drinks already higher than most of its competitors, there isn’t much scope to raise prices. Competition Heats Up In India, Dunkin’ Brands opened its first Dunkin’ Donuts outlet recently and plans to add another 100 in the next five years. Apart from possessing the first mover advantage, Dunkin’ Donuts also benefits from its relatively lower priced menu. The coffee chain has also added items such as mango milkshakes and mango doughnuts to cater to the tastes of local Indian population. It will be interesting to see what amendments Starbucks makes to its menu when it opens its first restaurant in the country in August this year. Besides Dunkin’ Donuts, Starbucks has to compete against the already established players such as Costa Coffee, Cafe Coffee Day and Barista. Starbucks plans to add around 50 restaurants in India in the next few years. We recently wrote an article on areas where Starbucks can potentially falter in China . Understand how a company’s products impact its stock price at Trefis
McDonald's Wins Market Share With New, Fresher Menu Items
McDonald’s Corporation (NYSE:MCD) has added two breakfast focused items, McCafe Cherry Berry Chiller and Blueberry Banana Nut Oatmeal, to its U.S. menu. Adding new menu items has certainly helped McDonald’s keep its menu fresh and maintain its dominance in the breakfast segment. Last year, the restaurant chain added products such as Fruit & Mango Oatmeal, Mango Pineapple Smoothies, and Peppermint Mocha . McDonald’s competes with Yum! Brands (NYSE:YUM), Subway, Starbucks (NASDAQ:SBUX), Wendy’s (NYSE:WEN), Chipotle Mexican Grill (NYSE:CMG), among many others. We have a Trefis price estimate of $98 for McDonald’s, which is about 7% above the current market price.
AMR Ready To Take Flight With US Airways As Creditors Take Closer Look
Everything seems to be heading in the right direction in US Airways’ (NYSE:LCC) plans to merge with bankrupt American Airlines (NYSE:AMR) as AMR’s creditors pushed it to analyze potential consolidation scenarios with US Airways. AMR, the parent company of American Airlines, was earlier rigid towards a stand-alone route to rescue the airline. US Airways has done well to convince American’s workforce by including favorable elements for them in its merger proposal, fewer job-cuts being the prime element. The airline industry has already witnessed successful M&A deals in the last few years such as Delta (NYSE:DAL) -Northwest, United-Continental (NYSE:UAL) and US Airways-America West. All of these events are increasingly pointing towards this merger materializing in the near future. The effects of growing optimism towards this merger are also showing up on the trading floor as the stock has shot up by almost 125% to $11.21 this year. We have a Trefis price estimate of $11.92 for US Airways, which implies slight upside from its current market price.
Sina Worth $66, Maps Out Way Ahead For Weibo
Sina (NASDAQ:SINA) announced its earnings for Q1 2012 on May 15 and reported revenues of $106 million, up 6%, but swung to an operating loss due to an increase in its operating expenses, especially R&D costs. Year-over-year advertising revenue growth was lower than expected and ad revenue actually dropped significant compared to Q4 2011, while mobile VAS related revenue continued to decline as expected.
GM's Exit May Signal Challenges For Facebook's Ad Revenue Growth
Facebook seems to have hit yet another hurdle right before its IPO. General Motors (NYSE:GM), which is one of its largest advertising clients, has decided to stop advertising on the social networking giant, stating the its paid ads on Facebook had little impact on its targeted consumers’ purchases. If other advertisers run into this issue as well, it may be a cause for worry as text and display advertising is Facebook’s most profitable and primary business currently.
Baker Hughes Relies On Oil Exploration As Gas Rig Count Falls
Oilfield services player Baker Hughes (NYSE:BHI) came out with its latest rig count report, showing that the number of rigs directed towards gas exploration continued to fall as low gas prices caused explorers to trim down on new wells. However, the industry outlook in North America continued to remain strong as activity shifted to oil rich plays. With gas prices falling to less than $2 / Million British thermal units (MMBtu), the shift towards liquids has picked up pace as companies are becoming more cautious about investing in pure gas plays. Natural gas rig count fell below 600 last week. Baker Hughes and Halliburton (NYSE:HAL) are among the main players in the North American oilfield services market. We have a $56.50 price estimate for Baker Hughes, which is at a 40% premium to its current market price.
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