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Morgan Stanley gives Goldman a lesson in diversity

19 Jul 2017

Stabilizing fixed-income trading isn’t the only way CEO James Gorman showed Lloyd Blankfein his tail for the second quarter in a row. His growing wealth unit helped, too. With the diversified firm firing on all cylinders, it is justifiably overtaking Goldman even on valuation.

Goldman’s compass points in wrong direction

18 Jul 2017

Fixed-income trading revenue fell 40 pct in the second quarter as Lloyd Blankfein’s Wall Street firm again navigated the market worse than rivals. The $90 bln Goldman is slowly changing course, but its high valuation relative to rivals demands faster improvement.

Peltz goes for the close shave at Procter & Gamble

17 Jul 2017

Unlike his last proxy fight at DuPont, the activist is taking a more surgical approach, lobbying for one board seat at the $223 bln razors-to-detergent conglomerate. Trian is also supporting management and not calling for a breakup. Shareholders would be daft to turn him down.

Citi, JPMorgan and Wells show reliance on D.C.

14 Jul 2017

Higher interest rates helped all three big U.S. lenders beat estimates. But so, to varying degrees, did one-offs, low tax rates and benign credit costs. Performance isn’t yet justifying their healthy trading multiples. That will require more Washington talk to become action.

Volcker Rule emblematic of new Fed pick’s challenge

11 Jul 2017

Randal Quarles is set to be the central bank’s first head of supervision, a key role in Trump’s deregulatory push. But even where political consensus exists, like revising parts of the prop-trading ban, change requires support from fellow watchdogs. That’ll slow the process.

Buffett may have to turn on charm for Oncor encore

7 Jul 2017

Berkshire Hathaway is taking a second stab at Texas utility Energy Future, six years after a $2 bln investment led to big losses. Two other suitors failed to agree with regulators. Buffett's structure sounds smarter, but sealing the $18 bln deal could yet require some sweet talk.

John Malone papers over QVC woes with HSN purchase

6 Jul 2017

Liberty Interactive is taking full control of the home-shopping channel in a $2.1 bln deal. Merging two cable vendors makes sense, and investors should end up with something more valuable than a tracking stock. But a complex share swap alone won’t solve deeper retail challenges.

Vantiv sets punchy price on Worldpay

5 Jul 2017

Buying Britain’s biggest payments processor for nearly $10 billion only makes sense if the cost savings and revenue opportunities are big enough. While neither side has come up with any synergy estimates yet, some charitable assumptions are needed to make the sums add up.

Walgreens salvages mild boost from intense effort

29 Jun 2017

After antitrust pushback on acquiring the whole of Rite Aid, the U.S. drugstore is buying over 2,000 of its rival's stores for $5.2 billion. For CEO Stefano Pessina, doing about half the deal with half the benefits is something – but it's a modest return on 20 months' work.

Cable guys’ Sprint lurch bound for crossed wires

27 Jun 2017

Comcast and Charter are in talks with the $33 bln U.S. mobile carrier that may include a range of options, from the use of airwaves to an acquisition. Wherever they end up, a ménage-à-trois involving moguls John Malone, Brian Roberts and Masayoshi Son could prove ungainly.

Nestle’s big problem is its crunchy governance

26 Jun 2017

Hedge fund Third Point’s ideas for the Swiss maker of KitKat are sensible but obvious. Nestle is already weighing up asset sales. It has set and missed targets before. Shaking up the company’s slow-moving culture would achieve more – starting with a new chairman.

Blackstone may have to financially engineer itself

22 Jun 2017

The buyout shop's units are trading close to the $31 IPO price of exactly a decade ago. Even with dividends, Blackstone's owners have fared no better than if they'd bought the S&P 500. Getting anywhere near boss Steve Schwarzman's $100 price target probably requires big changes.

Governance coup caps first leg of Uber’s journey

21 Jun 2017

Travis Kalanick quit as CEO amid pressure from the ride-hailing app's investors. His stewardship had become a distraction. For a private firm to jettison its controlling shareholder suggests a modicum of market discipline in startup land – if he really does take a back seat.

Jefferies plods in Morgan Stanley’s footsteps

20 Jun 2017

Like its bulge-bracket rival, Richard Handler’s investment bank seems to have steadied its bond-trading business. An underwriting boost in the quarter to May bodes well for the rest of Wall Street. But Morgan Stanley's James Gorman has so far turned more progress into profit.

Amazon’s one-click deal keeps Wal-Mart at bay

19 Jun 2017

The $230 bln superstore chain's stock fell 5 pct on news of the e-commerce giant's $14 bln purchase of Whole Foods. The target's shares rose above Amazon's offer, implying another bid might emerge. But a defensive effort from Wal-Mart or a worried rival looks a financial stretch.

Amazon buys its way to the top of the food chain

16 Jun 2017

The e-commerce titan is going whole hog for U.S. groceries with the $13.7 bln acquisition of Whole Foods. Amazon's comfort with low margins and savvy in logistics make it a fearsome rival. The purchase price pales compared to the value the deal just chewed up across the industry.

Wells Fargo drives stagecoach further into mud

15 Jun 2017

The $270 bln lender is being sued for changing bankrupt borrowers’ mortgage terms without consent even as its fake-accounts scandal unfolded. Home loans should've been squeaky clean after earlier missteps, too. The bank now run by Tim Sloan is struggling to get the basics right.

J.Crew bond revamp is roadmap for asset transfers

14 Jun 2017

The retailer is trying to restructure $567 mln of debt giving some bondholders access to valuable assets that will irk other lenders. To bridge the gap, they’re offering those lenders buyouts at par. It’s a clever way to mend several problems. Other wobbly retailers take notice.

Yahoo investors are U.S. tax-reform skeptics

12 Jun 2017

With the sale of its core business ratified by shareholders, the company's $52 bln worth should reflect the after-tax value of stakes in Alibaba and Yahoo Japan. For now, the implied tax hit is 35 pct. People who believe Trump will succeed in slashing taxes should buy the stock.

GE’s CEO choice pushes the boundaries

12 Jun 2017

By anointing John Flannery to succeed Jeff Immelt the industrial titan is doubling down on a strategy that transcends its U.S. roots. Flannery knows restructuring and has run GE units from India to Argentina. Geographically and structurally, the company's lines may be redrawn.