It’s Worth How Much?! Coca Cola Gets Energized and Not Banking on Terrorism

Buy high, sell higher…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

They don’t call him the Oracle of Omaha for nothing. Shares of Berkshire Hathaway, helmed by the prescient Warren Buffet, hit a new, very high, milestone. For the first time shares of the most expensive stock trading in New York hit and even surpassed the $200,000 mark going up to $201,720 a share. Yep. For a couple hundred grand you too can own a single share of Berkshire Hathaway. Mr. Buffet feels that by not splitting the stock, as most companies would have done by now, Berkshire Hathaway gets a better class of investor. By better, he means investors who are more focused on long-term results, rather than other investors who make emotional trades. My emotions would be very happy to own a few of those shares. If you were looking for a more wallet-friendly option, you could always buy B class shares of Berkshire Hathaway which trade at a little over $130.  Berkshire Hathaway’s earnings, by the way, pulled in $6.4 billion in profits. Why, that’s almost a $3,900 gain per share – for the A class shares.

Enjoy a Coke…with a Monster Beverage

Image courtesy of Naypong/FreeDigitalPhotos.net

Image courtesy of Naypong/FreeDigitalPhotos.net

Coca Cola (KO:US) just got a bit more monstrous now that it picked up an almost 17% stake in Monster Beverage (MNST:US) for over $2 billion. It’s all part of Coca Cola’s grand plan to take equity stakes in companies that have new emerging promising brands. In May, Coca Cola did a similar move with Keurig Green Mountain Inc. Shares of Monster Beverage went up 26% to around $90 a share. Not quite Warren Buffet territory but still not too shabby.

Would you like that in small bills?

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

Jordan-based Arab Bank is not sitting pretty in court as it stands accused of being one of the official banking institutions for terrorism. Not exactly the kind of clientele you want associated with your bank. A lawyer for a group of American terror victims said the bank funneled lots of money ear-marked under a file labeled “martyr operations” for certain designees related to terrorists and suicide bombers. These files contained a list of people who were slated to receive $5,300 a pop (definitely no pun intended). Lawyers for the bank, however, argue that the bank followed all regulations and none of the names listed were flagged by any international law enforcement organization. That probably had more to do with the fact the names linked to accounts were (intentionally?) misspelled. The transactions took place at branches in the West Bank and Gaza and the list came from the Saudi Committee for Supporting Al Quds Intifada. Arab Bank now holds the dubious distinction of being the first bank on trial under Anti-Terrorism Act.

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Not-So-Splashy Earnings for SeaWorld, Retails Fails and Cisco’s Mixed Messages

Tanked…

Image courtesy of tor00722/FreeDigitalPhotos.net

Image courtesy of tor00722/FreeDigitalPhotos.net

Shares of SeaWorld (SEAS) appear to be evaporating by 33% today after the amusement park company forecasted a decline of 6-7% with a lot of help from the very unflattering docu-drama “Blackfish.” The film, which takes a look at how killer whales in captivity are treated, seemed to put a damper on traffic to SeaWorld, especially at its San Diego location. The film had its debut just two months before SeaWorld’s IPO. Coincidence? Hmm. This marks the first time “Blackfish” has actually been mentioned with respect to SeaWorld’s earnings. Wall Street had predicted the company would pull in revenues of $447 million. But no such luck as revenues came in closer to the $405 million mark. To make matters worse, revenue was $415 million this time last year.

July retail blues…

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Just when things were starting to look up, leave it to the month of July to put a damper on our fiscal spirits. That’s because, according to the US Commerce Department, US retail sales disappointed. How much did they disappoint? Well…they flat-lined. Sales flatlined despite jobs growth. Yes all that exciting job growth that we have been seeing the last few months could not pull July out of its lousy retail funk. Apparently, even all those people cashing in all their brand new employment checks still need a bit more time before they decide to part with their funds. The other little issue at play is that even though sales did grow in the clothing, personal care and, of course, groceries categories, those gains were offset by losses in other retail sectors. Let’s just hope (and spend) that this was a minor hiccup in a major fiscal recovery and not some evil sign of things to come.

Speaking of unemployment numbers…

Image courtesy of xedos4/FreeDigitalPhotos.net

Image courtesy of xedos4/FreeDigitalPhotos.net

IT provider Cisco came out with its fourth quarter earnings and actually beat analysts’ estimates. The company pulled in about $12.4 billion in fourth quarter revenue while Wall Street expected $12.1 billion. But. There’s always a but isn’t there? This one is about the company also announcing its plans to cut 8% of its workforce. In case you were wondering, that translates to 6,000 soon-to-be ex Cisco employees who will need to redo their LinkedIn profiles.

Not So Sweet Earnings, Uber-Lyfting and Not So Spade-tacular

Crushed by Wall Street…

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

King Digital Entertainment Plc., as you may have heard, is the maker of Candy Crush Saga, the game in which you have apparently lost interest, at least judging by its just released earnings. The mobile game maker missed expectations for its second quarter sales and its daily average users (you, me etc) took a major hit as this quarter saw about 138 million gamers while last quarter 143 million users were depleting their cellphone batteries playing games. The Dublin-based company has been watching its stock deflate by 19% since its much anticipated March debut of $22.50 a share. Net income rose to over $165 million from around $126 million a year earlier. Revenue for the company was over $593 million when $606 million was the number Wall Street wanted to see. And if you are amongst the chosen few, expect to see nice little “special” one time $150 million dividend. “Special” not because you are a high scorer on level 266, but special because you are among the directors, execs and investors. What? You’re not one of them?

Ride-Sharing Service smackdown…

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

It’s Uber vs. Lyft in the ultimate ride-sharing smackdown. The two companies have been hard at work making thousands of  reservations and canceling them on each other. They have been even harder at work blaming one another. Uber’s got about 177 employees who are being accused of booking and canceling over 5000 rides on Lyft. But apparently Lyft upped the ante by booking 13,000 trips. Also at play is the allegation that Lyft’s investors are trying to get Uber to buy Lyft. Hmmm. Too much time on their hands, I wonder?

Un-trending?

Image courtesy of John Kasawa/FreeDigitalPhotos.net

Image courtesy of John Kasawa/FreeDigitalPhotos.net

Kate Spade, once dubbed the poor girl’s Prada has had an interesting Wall Street ride. The stock fell 23% on the very untrendy news that sales for the brand are slowing down. Oddly enough, revenue for the company was up a very healthy 49% to $266 million, easily topping Wall Street’s expectations of $243 million and easily trumping last year’s revenue of $178.9 million. And the stock lost only $4.4 million compared with last year when the brand ate over $43 million in losses. But on Wall Street, especially for a brand like Kate Spade, it’s all about the future and in this case it’s not as cheerful as the brand’s accessories.

Kinder-gized! BuzzFeed’s On a $50 Million Buzz and Gov’t: Beware the Bitcoin

Feeling energetic…

Image courtesy of puttsk/FreeDigitalPhotos.net

Image courtesy of puttsk/FreeDigitalPhotos.net

Chairman and CEO, Richard Kinder of Kinder Morgan Inc (KMI), the brains behind Master Limited Partnerships or MLP’s (you should really google that one but hint: it gives major corporations tax-free status), decided to consolidate all four of his energy companies to the tune of $71 billion. Who is he, you might be wondering? Well as of today he helms the fourth largest energy company in the US with about 80,000 miles of oil and gas pipelines. He had (has?) four companies now under one roof. Lots of very important fiscal matters precipitated this decision which will be saved for another blog post (perhaps on somebody else’s blog). Shares of the stock went up 11% on the news. What all this means for you? Not much unless, of course you are an investor in the company, in which case your dividend is going up about 16% next year. As for KMI, well, it gives the company a nice solid boost which will likely help capture some of that $1.5 trillion in purchases and projects from the impending shale and drilling boom. Interestingly, Richard Kinder was once considered a front-runner for a job at Enron, which eventually went to Kenneth Lay. Instead of dwelling on the job he didn’t get,  Kinder took Enron cast-offs and built a multi-billion dollar energy empire. Ken Lay, on the other hand, screwed people out of millions and drove the company into the ground. Kinder, by the way, takes a yearly salary of $1 and no bonus. But don’t feel so bad. His annual  income is worth billions.

Getting Buzzed…

Image courtesy of cooldesign/FreeDigitalPhotos.net

Image courtesy of cooldesign/FreeDigitalPhotos.net

Maybe you were taking a quiz on BuzzFeed today or scrolling through one of its highly entertaining lists. Whatever it was, you helped contribute to the reason why venture capital firm Andreesen Horowitz put up $50 million putting for BuzzFeed, making its latest valuation at $850 million. Investors are sure BuzzFeed is about to go head to head with the more hard core news outfits given the public’s propensity to get so much of their content off of BuzzFeed. And it’s no wonder since the company very resourcefully uses technology to come up with ideas for content that people will want to read. Pure genius, if you ask me. But it’s advertisers – big major advertisers – who are loving it too and investors love when advertisers love something. Also, BuzzFeed’s got that new BuzzFeed Motion Pictures coming up and generating plenty of investor tongue wagging. It’s rumored that the company took in $120 million in revenue last year and reportedly gets 150 million users per month. The new funds are slated to be used to expand into Tokyo, Mumbai, Berlin…

The wild wild west…

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

Image courtesy of Victor Habbick/FreeDigitalPhotos.net

Government regulators had no love for Bitcoin today as the Federal watchdog agency, Consumer Financial Protection Bureau, issued an advisory over the controversial cyber-currency. Because Bitcoin and its fellow digital currencies are not insured or backed by any government, consumers who opt to use them are “stepping into the Wild West.” Yeehaw. The agency warns that consumers are at risk to unstable exchange rates, hacking, scams and theft. But others argue that credit cards and the internet faced the same issues and criticisms in their early days. Sounds fair. In any case consumers can now vent their complaints about the virtual currency at www.consumerfinace.gov.

Watch What You Say Argentina, You’re FICO Kidding Me and Malaysia Airlines Gets Overhauled

The World Cup it ain’t…

Image courtesy of StuartMiles/FreeDigitalPhotos.net

Image courtesy of StuartMiles/FreeDigitalPhotos.net

A U.S. Federal judge threatened to hold Argentina in contempt of court. I do mean the country. Not a person with the name Argentina. An entire country. In contempt. The country, it appears can’t seem to control the statements coming out of its collective mouth – by mouth I mean the mouths of its political leaders and the mouths of its attorneys. Those mouths are making some irresponsible “false and misleading” statements about its debt crisis, according to a US judge. If the country had just paid back its bondholders on July 30 like it was supposed to do, then there would have been no issues. But now it’s a very big and very real and very problematic debt crisis. Argentina wants to move this case to the International Court of Justice in the Hague to preside over the matter. However, it still doesn’t change the fact that Argentina owes US bondholders $1.5 billion. The country insists that  it is not in default even though it has yet to actually repay any required payments.

A credit to your…credit…

Image courtesy of Michelle Meiklejohn/FreeDigitalPhotos.net

Image courtesy of Michelle Meiklejohn/FreeDigitalPhotos.net

Exciting things are happening at FICO, that pesky arbiter of credit ratings that might have been keeping you from getting that credit card at Barney’s or maybe kept you from getting that much more appealing interest rate. FICO, aka Fair Isaacs Corp. finally made some changes to the way credit scores are calculated. Oddly enough, FICO has decided to institute these changes at a time when more than a third of Americans already have debt in collection, but hey whatever works, right? Just make sure that you pay up any and all bills that have already made their way to a collection agent. As long as those debts are satisfied, even if they are in collections, those misdeeds wont stay on your credit report for seven long annoying years as they have in the past. The new measures also don’t put as much weight on debts related to medical bills.  If you’re lucky, you could see your FICO score go up by as much as 25 points, which is great news, as long as you’re willing to wait a year for that to happen.

Grounded… 

Image courtesy of vectorolie/FreeDigitalPhotos.net

Image courtesy of vectorolie/FreeDigitalPhotos.net

Not that this should come as any great surprise, but Malaysia Airlines is getting a major fiscal facelift. The Malaysian government picked up the tab on the embattled airline for the bargain price of $516 million. Ironically, the company will now be privately held by a government. Considering the airline saw two downed planes – of course, through no fault of its own – travelers aren’t exactly clamoring to get onto its flights. Well, that and the fact that Malaysian Airlines also can’t compete with some of its more budget friendlier regional competition.  Incidentally, up until these two catastrophic flights, the airline had a superb record of safety.

Zynga Zinger, Supreme Cyber Smackdown and Fannie Mae is Back on Top

Game over?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Zynga took a nasty little hit to its second quarter earnings by barely breaking even. And that’s being generous. While Wall Street was hoping to see revenue of $157 million, the San Francisco-based gaming company, currently notable for “Farmville,” took in $153 million in revenue with a $.07 per share loss. Ah! But what is a mere $.07 in the grand scheme of things, you might be wondering? Well that grand scheme adds up to a $62.5 million loss. Last year at this time the company’s loss was but a mere $15.8 million. However, there is hope on the mobile horizon, or so Zynga feels, as “Farmville 2: Country Escape” has become an Editor’s Choice in the Apple App store – a very significant barometer of what makes a game successful. Then there are those handy licensing deals with the NFL and Tiger Woods, among others, that Zynga is counting on to turn those earnings in the up direction.

E-commerce competition!

Image courtesy of cooldesign/FreeDigitalPhotos.net

Image courtesy of cooldesign/FreeDigitalPhotos.net

It’s about to get a whole lot nastier – but luckily, not for consumers – in cyberspace thanks to the nifty new alliance that was forged between Barnes & Noble and Google. Yes. I did write Google – well Google Shopping Express, to be more precise. The two companies have teamed up to provide a little competition to Amazon. But that’s not in the official statement, of course. The partnership, which should give a much needed boost to the bookseller, will provide same-day delivery in certain areas, just like rival Amazon. After all the trouble Amazon caused for book publisher Hachette, this new deal probably couldn’t have come at a better time as consumers are feeling a little less affectionate towards the e-commerce giant. Google Shopping Express has already teamed up with major retailers like Target and Costco. By the way, you can subscribe to Google Shopping Express free for the first six months, with a subscription fee to be determined at the end of that time. Or you could just plunk down $4.99 per order. Happy shopping!

Pay it backwards…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Fannie Mae, who once upon a time had to hit up taxpayers to the tune of $116 billion at the height of the financial crisis is about to have paid us all back in full. Sort of. The mortgage lending company just reported its tenth straight profitable quarter – $3.7 billion in profits, in fact.  And a check for that amount is in the mail…to the US Treasury. After the Treasury cashes that out, Fannie Mae can take a breather as it will have more than fully repaid its debt. And while that $3.7 billion profit might seem impressive, that figure is actually a 63% decrease over the same period last year, where Fannie Mae pulled in over $10 billion in profit.  Incidentally, Fannie Mae earned $84 billion in 2013. Not bad for a year’s work, huh?

 

 

Russia: Sanctions? Ha! I’ll Show You Sanctions! More Boffo Hits to BofA and Time Warner Not Feeling Foxy

Putin it out there…

Image courtesy of Simon Howden/FreeDigitalPhotos.net

Image courtesy of Simon Howden/FreeDigitalPhotos.net

Russian president Vladimir Putin always has to have the last word, doesn’t he. He’s like one of those inflatable punch toys. No matter how you much you punch it, it just floats right back up. I am talking about sanctions, mind you. The ones that Russia is imposing on the West, including the United States. Russia majorly one-upped the entities imposing sanctions on it over tensions in the Ukraine by banning agricultural products from the US, the EU, Canada and even Japan. They plan to have this ban in effect for a year!  Apparently it’s a very very long list of items too. So yeah, if the West wants to send Putin a message it’s going to have to think way beyond that teeny tiny economic sanctions box. Of course food prices are sure to rise in Russia with a move like this. But make no mistake that there’s also a steep $1.3 billion price to pay in the US and the rest of the West. And that’s going to be awfully hard to swallow.

And it’s official…

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Bank of America is out almost $17 billion (it will be anyways) all because it misled investors over mortgage-backed securities. This settlement comes just weeks after a New York judge ordered the bank to pay out $1.27 billion for its less than virtuous Countrywide Financial “Hustle” program which is just as bad as it sounds. Some of the settlement cash will actually go towards helping struggling homeowners by reducing their mortgages. The rest is fees fees fees and a few billion in penalties to various federal, state and local entities. BofA CEO Brian Moynihan and US Attorney General Eric Holder have been hashing out the details as of late. BofA was trying to get away with paying just under $13 billion but fate, the justice system and AG Holder’s impending lawsuit had other plans. Now BofA holds the dubious distinction of holding the record for the largest settlement payout, knocking JP Morgan off its $13 billion podium. But Bofa still comes out a winner since no criminal charges will be filed for what could arguably be considered awfully criminal behavior.

Time Warner is running out?

Image courtesy of dream designs/FreeDigitalPhotos.net

Image courtesy of dream designs/FreeDigitalPhotos.net

There was no shortage of love today on Wall Street for Rupert Murdoch and his 21st Century Fox empire now that his $80 billion bid for Time Warner has been scrapped. In fact, the media company’s stock surged while, ironically (or maybe not) Time Warner’s second quarter earnings took a hit. Sure its quarterly profits were up 10% with $6.8 billion in quarterly revenue. But the stock took an 11% dive thanks to Fox just because its interest in its rival came to a bittersweet end.