Trump’d up suit?
Dontcha just love a good fight? Today’s nasty dispute is brought to us by the U.S. government and AT&T. Not sure who my money’s on yet. You see, the government isn’t down with AT&T’s proposed $85 billion vertical merger with Time Warner. So it went ahead and did the most “American” thing possible: It sued AT&T to block the merger. Knowing that the U.S. government was going to be pesky about the merger, AT&T did what any smart company would do: It pre-emptively retained counsel. And AT&T went for the big guns hiring Dan Petrocelli. You remember him, dontcha? Or maybe you’re just trying to forget? He’s the dude that very shrewdly defended President Trump over lawsuits relating to the infamous Trump University real estate seminars. Oh, the irony. Trump hates the very thought of the merger and that may have something to do with his feud with CNN, which, incidentally, is owned by Time Warner. Petrocelli, who seems to have forgotten all about his Trump days, is arguing that not only does this lawsuit not pose a threat to industry competition, but the merger actually has the potential to lower cable bills. However, I have a hard time believing a cable carrier would willingly lower bills. As for investors, they seem to be on Team AT&T and believe the telecommunications giant will emerge victorious, especially because the last time the government was successful against a vertical merger, Nixon was president. Yikes!
Whose the turkey now?
OMG! It’s football season and Dish Networks did the unthinkable – to football fans, anyway – and dropped CBS in some markets. “Some markets” includes over 3 million customers in 18 cities who will be feeling the effects of tryptophan sans quality NFL time if a deal is not reached by kickoff time. As if blocking football games isn’t bad enough, some viewers will even be getting deprived of “The Big Bang Theory” which is just so not cool. The issue, of course, is fees. Because it always is. Dish isn’t happy about CBS’s demands for higher fees, especially since Dish viewership is down (note: Google streaming on-demand video). Dish also insists that viewers are watching less CBS and feels that CBS ought to show a little more restraint in its fee demands. CBS, on the other hand, is accusing Dish of punishing its viewers while Dish is calling foul on CBS for not extending its contract until negotiations end. However why any of this matters is beyond me since, invariably, those fees, on which the two sides eventually agree, usually end up getting passed on to subscribers via their monthly bill anyway. Now subscribers have something to look forward to once those inconveniently-timed negotiations come to a close.
Hurricanes suck. Except for home improvement retailers. Lowe’s would agree. The company just reported third-quarter earnings, much to the delight of Wall Street. As a result of Mother Nature’s very unappreciated wrath, sales at Lowe’s went up 5.7% to $16.8 billion, way more than the predicted 4.6% and $16.6 billion. $200 million of those sales came courtesy of Hurricanes Harvey and Irma that wreaked its proverbial havoc on a large swath of the country. But they helped the home improvement chain take in an $872 million profit that added $1.05 per share, which was three cents higher than analysts’ estimates. That number was particularly impressive since last year at this time, Lowe’s took in $462 million, nearly half that amount. But Lowe’s doesn’t owe all its quarterly success to natural disasters. The company also made a big push to cater to professional contractors. And with good reason. They spend more money. Sure DIY home improvement is Lowe’s theme, but the company was savvy enough to recognize an additional opportunity and the fact that the housing market is doing pretty awesome lately only sweetens the pot. And even though Lowe’s shares dropped a smidge during trading this morning, it can’t be too distraught since the company’s shares are up about 15% for the year.