Apple vs. Feds Smackdown; Billionaire Country Breakdown; It’s Highs and Lowe’s for Home Improvement Sector

Rotten to the core…

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It’s game on between Apple and the FBI as the two entities tussle about unlocking an iPhone. The Feds feel this request falls under the Writs Act from 1789 that compels companies to assist in law enforcement. Apple is preparing to argue before a Federal court that software code should be protected by the First Amendment while terrorists the world over sit back and enjoy a good laugh at the the expense of the U.S and its constitutional rights. This is all because the Feds want Apple to unlock a phone belonging to San Berbardino shooter/terrorist Syed Rizwan Farook as authorities are convinced there is a lot of valuable intel contained on that one little device. In fact, since early October, Apple has received orders to unlock thirteen other devices, and an L.A. district court judge ruled that Apple should help the Feds bypass that pesky setting which wipes an iPhone clean after ten incorrect password guesses. Apple CEO Tim Cook is adamantly against this backdoor attempt to unlock an iPhone lest it fall into the wrong hands. Cook wants the issue decided by Congress and not the courts. Problem is, phones regularly fall into the wrong hands, as in this case, so what to do about a device that potentially holds vast amounts of life-saving information that could lead to the arrests and capture of more wrong hands?

 

All about the benjamins…

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Image courtesy of Kittisak/FreeDigitalPhotos.net

After owning the title for so long, the city of New York no longer reigns supreme as home to the largest population of billionaires. The title of “Billionaire Capital of the World” now  belongs to Beijing, which is kind of weird since the Chinese economy has taken such a beating these last few months. These new findings come courtesy of the Hurun Report, a Shanghai-based firm that publishes monthly. And while Forbes’ compiles its own list of billionaires, the two publications tend to yield slightly different results, if only because they employ different calculation menthods. Incidentally, Hurun’s results did take into account January 15, the day when China’s economy hit the skids, tanking 40%.  But that still didn’t stop it from adding 32 new billionaires to the list, bringing its grand total identifiable billionaire population to 100. Beijing’s numero uno billionaire is Wang Jianlin, a real estate developer whose net worth is estimated to be $26 billion. Hurun chairman, Rupert Hoogewerf, says that these rankings don’t tell the whole story of China’s vast wealth, and estimates that only about 50% of China’s billionaires were identified. Plenty of the county’s other billionaires prefer to keep their wealth asecret so they don’t end up having to fork a chunk of it to authorities. New York still managed to welcome four more billionaires into its fold, giving the city a grand total of 95. Moscow took the third spot while Hong Kong and Shanghai scored spots four and five respectively.

Lowe’s and behold…

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Image courtesy of Kittisak/FreeDigitalPhotos.net

Home Depot and Lowe’s regaled us with their earnings and it was good news, kind of. Both home improvement chains scored lofty gains in large part due to housing demand, low interest rates and job and wage growth – all super good things. Oh, and this time the warm weather actually helped sales too. But while Lowe’s quarterly sales gains were up 5.5%, Home Depot’s sales gains were way more impressive, gaining close to 9%, suggesting that Home Depot is benefitting way more from housing gains than Lowe’s. Which probably explains why shares of Lowe’s fell a bit today. Apparently Home Depot , according to experts anyway, has a stronger brand image and consumers see it as the go to store for their home improvement needs. Case in point, kitchen products are a big seller for Home Depot and that department killed it this quarter, while Lowe’s kitchen products department performed below average. Ouch. Home Depot also has 2,274 stores compared to Lowe’s 1,857 stores. In any case, Lowe’s is expecting to snag a 6% rise in sales, compared with analysts predictions of less than 5% and the company still added 59 cents per share with sales of $13.24 billion, smacking down predictions of $13.07 billion.

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That’s Sue Bad! Wells Fargo Faces City Lawsuit; Disney’s Enchanted Earnings; Sprint One Step Forward, Two Step Backward

You don’t say…

Image courtesy of Stuart Miles/FreeDigital Photos.net

Image courtesy of Stuart Miles/FreeDigital Photos.net

Try not to get too emotional now, but Wells Fargo is getting sued by the city of Los Angeles for…get this...fraudulent business practices. I know. Hard to believe. According to City Attorney Mike Feuer, “The largest California-based bank had a culture of high-pressure sales that pushed employees toward “fraudulent conduct.” Apparently some of the bank’s employees allegedly opened unauthorized accounts, misused confidential information and charged fees all in the name of sales. Wells Fargo is also accused of failing to notify its customers that their information was breached. Customers were charged fees, many of which ended up in collections and damaged their credit reports. Unauthorized accounts were opened using money from existing accounts. Wells Fargo says that it did have a few misbehaving employees in their midst who were either fired or disciplined for engaging in such appalling practices. The lawsuit is seeking $2,500 – $5,000 per violation and an end to these practices. A statement from the bank said, “Wells Fargo’s culture is focused on the best interests of its customers and creating a supportive, caring and ethical environment for our team members.” But when asked directly whether unauthorized accounts were opened, the bank was conveniently mum.

Charming…

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Image courtesy of jscreationzs/FreeDigitalPhotos.net

They don’t call it the happiest place on earth for nothing. Disney came out with its second quarter earnings which were up a very magical 10%. Much of that was from its parks and resorts, which were up 24% alone. It helps that Disney not so charmingly raised its prices on them. Shanghai Disneyland, scheduled to open next year, ought to add a little more drama in the fiscal quarters following its debut. Profit for the company came in at $2.1 billion and $1.23 per share. Analysts only expected $1.11 per share while last year the House of Mouse took in $1.9 billion. There was a downside. Sort of. ESPN’s carrying fees ate into a lot of that profit but because sports games are so insanely popular, Disney still managed to make some cash off of them. But no earnings report since 2014 would be complete without mention of the surprise runway hit movie from the magical kingdom of Arendelle. “Frozen” continues to be a constant source of fiscal joy as toys from the film keep flying off the shelves. Even though Disney has yet to repeat the magical quarter from whence “Frozen” was released, it is hoping “Avengers: Age of Ultron” will facilitate that, as its release of “Cinderella,” while taking in a charming $495 million, was no “Frozen.” But then again, what is?

Are you listening?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Perhaps you recall Sprint’s recent promotions to get customers to switch over from Verizon and AT&T? One involved cutting bills from other carriers in half. I recall chainsaws being used in these commercials. Then there was the promotion where Sprint even offered to eat the cost of customers’ early termination fees from the aforementioned carriers. Well, those tactics almost paid off. Sprint picked up 1.2 million new subscribers in its fourth quarter, bringing its total subscribers to 57 million, and keeping it comfortably perched at the number three spot amongst wireless carries. It just barely beat T-Mobile. But the math didn’t quite work out so nicely and Sprint also took a loss of $224 million losing 6 cents per share. It’s particularly harsh since Wall Street was only expecting a loss of about 4 cents. Revenue was down $8.28 billion when analysts expected $8.5 billion and was a 7% drop from last year. So I guess the promotions are over. Or will be.