The Mouse is Going After the Fox; Dollar Wise for Fast Food; A Wrinkle in Allergan’s Plan

Fox-y mouse…

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Today’s juicy merger gossip is brought to you by Fox and Disney. Apparently, a deal is thisclose that will have Disney scooping up Fox’s studio and television production assets. The deal, which is rumored to be worth about $60 billion, will also include the acquisition of Fox’s stakes in Hulu and Sky. As for its news and sports division, Disney is taking a pass on those entities. But Disney isn’t the only one with its sights set on Fox. Comcast and Verizon are also trying to get in in some Fox action. It’s just that right now Disney seems to be getting the best crack at the media conglomerate. Wall Street seems to like the news considering it sent shares of Fox up over 3%. But the question you might be wondering about is why Disney even needs  $60 billion worth of Fox’s assets? Doesn’t it have more than enough of its own? Well,  yes, it does. However, in case you missed it, the entertainment industry is changing, with a big push towards streaming and direct to consumer models and believe it or not, picking up those particular assets over at Fox will give Disney a much much bigger global reach. And who couldn’t use some more global reach, right?

Bucking the trend…

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Fast food restaurants are engaged in a bloody dollar war. But that just means good news for consumers. McDonald’s is bringing back its dollar menu, which it ditched just four years ago because it didn’t pull down the kind of cash McDonald’s wanted to see. As for the term “dollar,” well that might be a bit generous in its definition. To be clear, the fast-food chain is offering the $1-$2-$3 Dollar Menu. If you’re in the mood for a sausage burrito, cheeseburger or any-size soft drink, well then, feel free to fish out that dollar bill that’s burning a hole in your wallet. Otherwise, prepare to shell out more. Not to be left out of the fast food fiscal fun, Burger King and Wendy’s are also trying to woo you with their version of “value” menus. But it’s Taco Bell that’s really taking aim at the Golden Arches with 20 items listed for just a dollar.  For McDonald’s, the cheapy menu is its answer to win back customers. The company apparently lost out on some “500 million transactions” because it didn’t have a value menu. Ironically, or not, Taco Bell’s dollar menu actually generated $500 million in sales. To make up for the lack of profitability that comes with McDonald’s having a value menu, the chain is expanding its “Signature Crafted Recipes” – which is really just code for more expensive menu items that will offset the value items.

A wrinkle in time…

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There’s a new Botox sheriff in town and Allergan doesn’t like it. Not one bit. Enter Revance Therapeutics Inc., a small biotech company that holds the formula for RT002, aka “the better, longer-lasting botox.” If it’s approved people can start sticking their faces with the stuff as early as 2020. Which is great news for everyone. Well, everyone except for Allergan, the pharmaceutical giant behind Botox, the original, whose stock fell over 4% on the news today. In fact, today Allergan hit its lowest price since 2013, after losing a third of its value in the last five months. And, while RT002 uses the same main ingredient for wrinkle reduction as Botox does, that being botulinum toxin Type A, it also uses the company’s proprietary peptide technology, which is apparently the reason why this particular formula lasts about a month longer than Botox.  In any event, Allergan wasn’t especially impressed by Revance’s new data released today and called it “underwhelming.” As for Allergan’s response, you could probably just call it sour grapes.

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That’s All Folks: Yahoo Rides Off Into the Sunset; Uber Drama; Trump’s Attempts at Flattery; It’s Raining Tacos and Cheesecake Today

And that’s a wrap…

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Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Sometimes goodbyes are hard and sometimes goodbyes are worth $23 million. At least that’s the case for Marissa Mayer, who will be collecting that much cash now that Verizon’s $4.5 billion acquisition of Yahoo is a done deal. Gosh, imagine what she’d be collecting if she were asked to stay on board. In any case, Yahoo will now melt into the AOL vortex and together they will morph in a new entity profoundly named Oath. However, once that happens, over 2,000 employees can expect to kiss their jobs goodbye. The last itty bitty remaining pieces of Yahoo will be named Altaba in homage to the fact that it is primarily a holding company for Yahoo’s sizable stake in the Chinese e-commerce site Alibaba.

Other highlights from today…

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Image courtesy of James Barker/FreeDigitalPhotos.net

  • It’s official: Uber CEO Travis Kalanick needs to compose his out-of-office reply. A management group will be established to run the show in his absence and when he returns he’ll be stripped of some of his duties. As for his return date, that is yet to be determined. It appears that he wont be missed that much. In the meantime, Uber now needs to come up with an effective system to tackle HR complaints. That might take awhile seeing as how the company is pretty much starting from scratch in that area.
  • In a meeting with Federal Reserve Chair Janet Yellen, President Trump said to her that he thinks she’s a “low-interest person” like himself. Which is ironic since during his campaign he had plenty of criticism for the Fed because it kept those rates low. He also said he “likes her” and “respects her” which could mean anything and nothing when you’re President Donald Trump. Naturally, the Fed declined to comment, all while rumors swirl that it is expected to raise short-term interest rates for the fourth time in two years.
  • Go out and get yourself a free taco today. A Doritos Locos Taco, to be more specific. It’s on the house. At least at Taco Bell. The fast-food chain is being generous because the Golden State Warriors “stole” game 3 from the Cleveland Cavs. Naturally, it’s all part of a promotion, in this case the one that goes “Steal a Game, Steal a Taco.” Whatever. It’s free food.
  • Shares of Cheesecake Factory took a beating today because of Mother Nature. No, really. Apparently, because of some bad weather, customers near locations in the East and Midwest couldn’t enjoy enough “patio time” whilst eating copious amounts of cheesecake, thereby negatively affecting sales. And just like you, the analysts didn’t buy that excuse either.

Subway Follows the Crowd; Sale Away: Cheap Southwest Fares Extended; SEC Wants to Take Down the Avon Pranker

Namaste no more…

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Subway doesn’t just want you to eat fresh. The sandwich chain now wants you to eat au natural. The company jumped on the healthy ingredients bandwagon finally announcing that it will be unceremoniously dumping yellow number 5, and other ingredients you have come to love and rely upon for all your unhealthy needs. McDonald’s, Taco Bell and a host of other fast-food chains already announced their plans to ditch the edible offenders that also include artificial flavoring and preservatives. But Chipotle reigns supreme boasting cuisine that is non-GMO, a tough act to beat in the fast-food universe. Oh well, they can’t all be king – of fast food, that is. It’s a wonder Subway waited this long to make the switch seeing as how it took a 3.3% sales hit last year. The sandwich maker also had to deal with a smear campaign over its use of azodicarboamide, an ingredient that Subway used to make its tasty bread, but one that is also found in…yoga mats. How anyone even discovered that azodicarbonamide would be a great bread ingredient is beyond me, but I digress. If you’re dreading the day when artificial ingredients make their hasty retreat from Subway’s 27,000 U.S. locations, then fear not. The complete changeover is expected to take eighteen months.

Who doesn’t love a sale?

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Some sales are just better than others, especially when there are airplanes involved. So, what was supposed to be a 72 hour sale over at Southwest Airlines, has now been extended another 24 hours to give would be trippers more time to book some wallet-friendly travel. Apparently the airline couldn’t handle the volume of traffic that flocked to its website for the sale, hoping to score some cheap fares for flights all over the country. Many enthusiastic travelers, eager to score these thrifty seats were receiving error messages when attempting to book their tickets while other bargain hunters had to deal with a slow moving site. But Southwest has beefed up their tech resources to handle the sale traffic so you still have until the end of day Friday to score a $49 (one) way trip…to somewhere.

Faking it…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Perhaps you recall the phony bid for Avon several weeks ago where a “company”  that went by the name PTG Capital filed a bid with the SEC to buy Avon? The “bid” was for more than three times the price of its stock and news of the offer sent shares up more than 20%. Turns out that the credit for the incredibly stupid prank goes to Nedko Nedev, possibly one of Bulgaria’s most embarrassing residents. Except it wasn’t so much a prank but rather a scheme that allowed Nedev to sell off his shares of Avon at a much higher price than he might have gotten for them had he done so legally. This scheme was nothing new for Nedev, who along with some other conniving associates, pulled this shtick with a few other companies including Rocky Mountain Chocolate Factory. Even though Nedev probably made a few extra bucks, he probably won’t get to spend any of it seeing as how the SEC intends to get its hands on the proceeds, not to mention, slapping Nedev with a few extra fines. However, the scheme also exposed flaws (gasp) in the SEC’s filing system which companies can actually access following certain procedures. So in a way it’s a good thing. Sort of. Okay maybe not.

Home Short Supply Home; Fast-Food Chains are Losing Their Artificial Appetite; Cabling Up

Home-y don’t play that…

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

There’s no place like home, that is, if you can actually get your hands on one. Homes in the U.S. seem to be in short supply, causing the ones that are already for sale to increase in value. Great news if you’re selling but bad news for buyers who are watching those prices rise because of that limited supply. The demand, however, is still there and people are continuing to buy up those homes as evidenced by the 5% increase in homes sales for the month of April. Experts thought that number would go up only 4.6%. Who can blame these eager buyers willing to shell out a few extra (thousand) bucks for a place to rest their heads. A decent job market and low interest rates are making this limited home supply that much more attractive. According to the ever informative Commerce Department, 517,000 homes were sold last month which was 6.8% more than last year at this time. Again, analysts only anticipated that 508,000 homes would find new owners. March saw only 484,000 new homes being sold. If you happen to be in the market for some new digs, take note that the median price for a house has gone up 8.3% over the last year to $297,300.

All the cool kids are doing it…

Image courtesy of Mister GC/FreeDigitalPhotos.net

Image courtesy of Mister GC/FreeDigitalPhotos.net

Artificial out. Natural in. And so it begins for both Pizza Hut and Taco Bell, two chains that have decided to throw in the artificial towel and kick the offending ingredients to the curb. It’s actually quite a big undertaking as this will affect 95% of their menus. But don’t worry about feeling it in your wallets. As least that’s what the people in charge are saying. The chains, which both happen to be owned by the same parent company, Yum Brands, are losing the fun colors and preservatives that you’ve come to expect in your fast-food cuisine. Your nacho cheese may not look as yellow by the end of July as Taco Bell gets set to say adios to the ingredient dubbed “yellow number 6.” And prepare yourself, diners, as you get set to munch on actual black pepper in it, as opposed to black pepper flavoring. Imagine that. Real black pepper. Who would’ve thunk it? Perennial offenders high-fructose corn syrup and palm oil will also be making an exit from the menu as well, and something tells me they won’t be missed.

Un-Charter-ed territory…

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Image courtesy of manostphoto/FreeDigitalPhotos.net

You may not care about this next piece of merger news as it may not affect you at all, especially if Netflix is your main provider of quality entertainment (in which case, I totally get it). But in the not-so-glamourous world of mergers and acquisitions, the fact that Charter Communications is scooping up Time Warner Cable is quite epic. It’s big news because 1.) two huge companies are coming together 2.) it will make Charter Communications the second biggest television and internet provider in all the land (of the United States, that is) and 3. there’s a ton of money being exchanged – over $55 billion or roughly the equivalent of the GDP for like a dozen developing countries combined (I may have exaggerated that one a little – but only a little). Interestingly enough, Time Warner Cable is much bigger, but that’s not stopping Charter from offering to shell out $195.71 per share to take on the company and bring its total customer base to 24 million. Of course, it’ll be no Comcast Communications, who comes in first with 27.2 million customers, but for now, it’s still a big – make that huge – step up for Charter.

March Goes In Like a Lion and Out With Impressive Housing Numbers; McDonald’s Earnings: Not Lovin’ It; Why Chipotle’s Not Very Chipper Today

Single homes, town homes, and condos, oh my!

Image courtesy of digitalart/FreeDigitalPhotos.net

Image courtesy of digitalart/FreeDigitalPhotos.net

Don’t you just love it when good things happen in the economy? Today’s bearer of fiscal sunshine is brought to us by the folks over at the National Association of Realtors who have been very busy calculating some delightful numbers from March’s existing home sales. And wouldn’t ya know it? Sales of previously owned homes picked up well over 6%.That, number, by the way, is more than a 10% increase over the same time last year.  If that doesn’t put a smile on your Wednesday, than I don’t what does. Because there was so much more inventory and lots more from which to choose, 5.19 million transactions of several different types of abodes took place, definitely shadowing February’s underwhelming 4.89 million figure. March’s existing sales, believe it or not (though, why wouldn’t you), hit its highest levels in 18 months. Curious what the median price for a home was in March? How does $212,000 sound? If you don’t like it than you should have tried buying a house a year earlier because that $212,000 is a 7.8% increase over last year’s $196,700 median price tag.

Losing its luster…

Image courtesy of Stuart Miles/FreeDgitalPhotos.net

Image courtesy of Stuart Miles/FreeDgitalPhotos.net

The numbers are in for the Golden Arches and well, and it ain’t pretty. After announcing yet another quarter of disappointing earnings, the stock actually went up today. That’s because McDonalds CEO Steve Easterbrook announced that on May 4 he will unveil initial details of a plan that ought to turn the tides of fiscal woe at the world’s biggest burger chain. McDonald’s needs it now, more than ever, as chains like Chipotle and Taco Bell also announced earnings that McDonald’s would kill for right about now. While a shortage of pork and a bummer of a winter did some damage to Chipotle, its earnings still  managed to climb over 10%. As for Taco Bell, who has been taking digs at McDonald’s in an effort to boost its breakfast offerings, saw a 6% increase in its earnings. All this while McDonald’s pulled in a whopper of a failure (no offense, Burger King) coming in with earnings of $812 million and 84 cents a share. But wait a minute, the chain made money, so what’s the problem? The problem is that last year at this time, McDonald’s made way more money, like 32.6% more. Like $1.2 billion worth adding $1.21 to its shares. But as of late, McDonald’s numbers just keep going down. To be fair, 9 cents of that loss can be blamed on the strong U.S. dollar. But the rest of the losses belong all to McDonalds.

Speaking of Chipotle…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Chipotle, which has been happily stealing a nice chunk of McDonald’s clientele with its more wholesome offerings, could find itself in a similar pickle as the Golden Arches. While the Mexican Grill did do much better than McDonald’s, the chain still missed analysts’ estimates. Then to add hot sauce to the fiscal wound, the chain anticipates continued “rolling blackouts” until the end of the year, due to a shortage of pork, an essential ingredient in its beloved carnitas. Naturally, the news sent shares of the stock down over 8% at one point. Shares of the company, that has about 1,800 restaurants, are hovering around $640. Yes, per share.

H&M Goes Haute on Profits; Google-gratulations; Taco Bell Gets Biscuit-y

So trendy…

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Image courtesy of sscreations/FreeDigitalPhotos.net

H&M posted some particularly impressive digits with profits up 36% to about $423 million. Of course, since it’s a Swedish company, those numbers came out to 3.61 billion kronors. I’m guessing analysts don’t do a lot of shopping at the world’s second largest retailer because they only expected 3.32 billion kronors. H&M attributes a lot of that success to some major online and store expansion activity. Whatever it was, it worked.  But here’s where things got dicey. Shares of the company fell over 3% because of one not so teeny tiny problem: Revenue for the first three weeks of March slowed to 9% from February’s 15%. This put a damper on the profit surge news. However, one analyst graciously pointed out that it was the first time in 17 months that growth even slowed to under 10%. So no one’s too concerned. It wouldn’t be right not to blame some of that on a winter that has overstayed its welcome. However, that strong dollar of ours is also going to be messing with H&M too, as it’s going to get a lot pricier to purchase goods and services to put out all those fabulously trendy and cheap clothes. Then there’s the not so minor issue that so much of its merchandise is purchased in dollars even though its sold in Euros. That might put a fiscal crimp on things, as well. Strong dollar or weak euro, H&M still has plans to open 400 stores worldwide.

Googled it…

Image courtesy of Stuart Miles/FreeDgitalPhotos.net

Image courtesy of Stuart Miles/FreeDgitalPhotos.net

Ruth Porat. Remember that name. That is, if you didn’t already, as she is regarded as one of the “most powerful women on Wall Street.” Except she’s ditching Wall Street for a new gig in Silicon Valley as Google’s new CFO. Just how big a deal is it? Well, Wall Street liked the appointment so much that Google’s stock went up almost 3% today because of it. Yeah, she’s that impressive. Ms. Porat has been at Morgan Stanley for 28 years but is no stranger to tech having worked on some major deals for both Amazon and eBay. During 2008’s nasty fiscal crisis, she advised the U.S. Department of Treasury on AIG, Freddie Mac and Fannie Mae.  She was even under consideration for the role of Deputy Treasury Secretary. Not too shabby. She’ll be replacing Patrick Pichette who said he’s retiring to spend more time with his family. So friggin’ sweet.  Ms. Porat gets to report to Google co-founder and CEO, Larry Page, who is presumably just as stoked about his new hire as Wall Street is.

Would you like that to go?

Image courtesy of Mister GC/FreeDigitalPhotos.net

Image courtesy of Mister GC/FreeDigitalPhotos.net

Is it a taco? Or is it a biscuit. Excellent question and for Taco Bell, whatever you decide probably won’t matter as long as you buy the darn thing. The fast-food chain is heating up the breakfast wars, yet again, armed with its latest weaponry – the taco biscuit, a biscuit in the shape of a taco. Got that? Last year Taco Bell took an advertising swing at McDonald’s with a campaign featuring people whose names were actually Ronald McDonald, devouring a Taco Bell breakfast and loving it. While it’s no doubt that McDonald’s did not care for this little shtick, the fact is that breakfast at the Golden Arches still accounts for 25% of McDonald’s sales when Taco Bell only sees 6% of its sales going towards the most important meal of the day (so they say).  Since traffic has been going up at fast-food establishments for the last four years, does the Taco Biscuit have what it takes to propel Taco Bell and its 6,000 U.S. establishments to hit its goal of seeing 20% of sales coming from breakfast? Time will tell, o’ fearless breakfast diner.

Can You Afford Not to Care? Gettin Riggy With It and McCoffee=McFree

Do you even (Obama) care?

Image courtesy of koratmember/FreeDigitalPhotos.net

Image courtesy of koratmember/FreeDigitalPhotos.net

In case you haven’t heard, though judging by the media bombardment I don’t know how that would even be possible, today is the very last day to sign up for open enrollment of Obamacare…whoops! I meant affordable health care on Healthcare.gov. It should be duly noted, however, that after passing the Affordable Care Act, I have yet to speak to anyone who finds their health care remotely affordable. If you’re just now getting around to it then good luck. You’re going to need it. Earlier today the site was down for almost four hours. Fraught with a variety of glitches, Healthcare.gov enrollees encountered a “virtual waiting room” while others were told to leave their email addresses and would get “invited back” to enroll. I couldn’t make this up if I tried. Then there were lots more who couldn’t even log on to the site. Oh so many many jokes and so very little time. I would love to hear some of yours. If you think the tax penalty is way more affordable than the alleged affordable care – $95 per adult and $47.50 per child –  just know that the penalty could also be 1% of your applicable income which can translate to a very unaffordable number for you.

The Stock Market’s what?!

Image courtesy of jscreationzs/FreeDigitalPhotos.net

Image courtesy of jscreationzs/FreeDigitalPhotos.net

“Stock market’s rigged,” says author Michael Lewis, whose explosive new book “Flash Boys” accuses a group of Wall Street insiders of rigging the stock market. “Flash Boys” tells the story of how high-frequency traders make billions via computerized trading. But how is this trading different from all other trading? For instance, these flash traders, are able to manipulate the market by figuring out what you’re going to buy, drive the price up and then sell it to you. Kind of like fortune telling except the fortunes are real (and so is the telling, for that matter) and you’re not the one making the fortune. All this takes place in seconds – actually less. But is it legal? Yes, but only because it’s so complicated. If it weren’t so complicated, it probably wouldn’t be allowed. Go that? Neither did I.

Bring on the McBattle…

Image courtesy of cbenjasuwan/FreeDigitalPhotos.net

Image courtesy of cbenjasuwan/FreeDigitalPhotos.net

It matters not how you feel about McDonald’s but rather how you feel about coffee since they are giving it away in April. It’s part of the first-ever National Free Coffee Event. It’s also probably part of the National Fast-Food Breakfast Wars (I made that one up) as McDonald’s and Taco Bell battle it out to feed you in the mornings. Taco Bell has a new breakfast menu that they’ve been heavily promoting and McD’s is a bit worried about it (not that they’ll ever admit that). So to take a big bite out of that south of the border momentum, McD’s is hoping to lure you with free coffee and then reel you in for breakfast. But you better hurry for your McD’s buzz as the promotion ends April 31.