Hermes $10,000 Birkin Purse Seen Leading to Record Sales

Posted by & filed under Company Analysis, Financial analysis, Growth & Valuation, Industry Analysis, Management Issues.

Description:  For decades, fashionistas have known that a Birkin bag is a safe style bet — if you can get your hands on one. That demand makes its producer, Hermes International SCA, the surest bet in the luxury industry when it comes to sales growth.

Source:  Bloomberg.com

Date: Feb 11, 2013

Link: http://www.bloomberg.com/news/2013-02-10/hermes-10-000-birkin-purse-seen-leading-to-record-sales-retail.html

Questions for Discussions:

  • Summarize the financial perfomance of Hermes in recent years.
  • What explains this success?
  • Would you expect this trend to continue for the near future?
  • Would you be a buyer of the stock?

 

Berkshire and 3G Capital in a $23 Billion Deal for Heinz

Posted by & filed under Company Analysis, Financial analysis, Financial Planning, Growth & Valuation, Management Issues.

Description:  Just days ago, the fate of a 144-year-old American icon was being hashed out in a Pittsburgh conference room as executives spoke by phone to representatives of two global billionaires who went by the code names “Owl” and “Goose.”

Source:  NYTimes.com

Date: Feb 15, 2013

Link: http://dealbook.nytimes.com/2013/02/14/berkshire-and-3g-capital-to-buy-heinz-for-23-billion/

Questions for Discussions:

  • Describe the finiancial structure of the deal.
  • How does it differ from typical Berkshire structures?
  • Why do you suppose this deal was structured in the way that it was?
  • Is the $23 billion price fair?

 

 

Dell LBO `Fair Deal’ for Shareholders, Sculley Says

Posted by & filed under Company Analysis, Financial analysis, Growth & Valuation.

Description: John Sculley, former chief executive officer of Apple Inc., and Shannon Cross, analyst at Cross Research, talk about Dell Inc.’s decision to go private in a deal valued at $24.4 billion, undertaking the biggest leveraged buyout since the financial crisis. They speak with Tom Keene and Sara Eisen on Bloomberg Television’s “Surveillance.” Joseph Weisenthal, deputy editor of Business Insider Inc., also speaks. (Source: Bloomberg)

Source: Bloomberg.com – video report

Date: Jan 30, 2013

Link: http://bloom.bg/XnL36c

Questions for Discussions:

  • Describe the structure of the deal.
  • Do you think it is a fair deal for shareholders?
  • What do the analysts say in this report?

 

Einhorn: What Tim Cook Should Do With Apple Cash

Posted by & filed under Company Analysis, Financial analysis, Financial Planning, Growth & Valuation.

Description:  Apple the world’s most valuable technology company, is being urged by David Einhorn’s Greenlight Capital to return more of its $137.1 billion in cash to shareholders. Einhorn speaks on Bloomberg Television’s “Market Makers.” (Source: Bloomberg)

Source: Bloomberg.com – video report

Date: Feb 07, 2013

Link: http://bloom.bg/XqQHnV

Questions for Discussions:

  • What is David Einhorn’s proposal to Apple?
  • Is this a good idea for the company, current shareholders, or potential shareholders?
  • What other financial options for dealing with the large cash holdings are available to management?

HP Investors Face a Lonelier Road Ahead

Posted by & filed under Company Analysis, Growth & Valuation.

Description:  Now that its nemesis, Dell (DELL), is going private and bowing out of the quarterly earnings spotlight, Hewlett-Packard (HPQ) finds itself at the intersection of two clichés: Misery loves company (but) breaking up is hard to do.

Source:  Businessweek.com

Date: Feb 08, 2013

Link: http://www.businessweek.com/articles/2013-02-08/hp-investors-face-a-lonelier-road-ahead#r=hp-ls

Questions for Discussions: How has HP boosted stock value in the past? How can HP management boost stock value today, given the current financial and business situation it faces?

Can Procter & Gamble CEO Bob McDonald hang on?

Posted by & filed under Company Analysis, Financial analysis, Growth & Valuation, Industry Analysis, Management Issues.

Description:  Earnings calls aren’t known for providing catharsis. Indeed, you wouldn’t have detected elation in the nasal, Midwestern tones of Procter & Gamble’s embattled CEO, Bob McDonald, as he answered questions after the ritual presentation of the quarterly numbers on Jan. 25.

Source: Fortune.com

Date: Feb 08, 2013

Link: http://management.fortune.cnn.com/2013/02/08/procter-gamble-mcdonald/

Questions for Discussions:

  • Would you consider Bob MacDonald a successful CEO, based on P&G’s financial history?
  • Do you think he made errors?
  • Do you think he can hang on?

Will Michael Dell become the Marlboro man of the PC age?

Posted by & filed under Company Analysis, Financial analysis, Financial Planning, Growth & Valuation, Management Issues.

Description:  Comment The mooted Dell takeover, the one to take it private again, is now happening. The big question is why? Why come off the public markets to operate as a private company again? The obvious and logical answer here being that the people buying the company think they can make more money this way than by not doing it. Why do they think this?

 Source:  TheRegister.co.uk

Date: Feb 06, 2013

Link: http://www.theregister.co.uk/2013/02/06/dell_private_like_tobacco/

Questions for Discussions:

  • What are the reasons for taking Dell private?
  • What are the benefits to stockholders of riding out the remaining life of a company as opposed to attempting to reinvent itself?
  • Why don’t more managers follow this line of thinking?
  • What is Dell’s primary reason for cash flow success, as argued in the report?

Amazon can do no wrong

Posted by & filed under Company Analysis, Economic Analysis, Growth & Valuation.

Description: Shares of Amazon are near an all-time high despite missing estimates. Investors continue to give Jeff Bezos the benefit of the doubt.

Source: CNNMoney.com – video report

Date: Jan 30, 2013

Link: http://money.cnn.com/video/investing/2013/01/30/investing-buzz-amazon-bezos-earnings.cnnmoney/

Questions for Discussions:

  • How is Amazon doing financially speaking and in the stock market?
  • How does this report explain the price support by investors in the company and its management?
  • Do you believe it is justified?
  • Do you see a similarity with Apple?

 

Facebook Profit Drops as Spending Rises on New Features

Posted by & filed under Company Analysis, Financial analysis, Growth & Valuation, Industry Analysis.

Description:  Facebook Inc. (FB) reported a plunge in fourth-quarter profit on higher spending, even while it made long-awaited progress luring advertisers eager to reach mobile- device users.

Source: Bloomberg.com – video report

Date: Jan 31, 2013

Link: http://www.bloomberg.com/news/2013-01-30/facebook-profit-drops-amid-higher-spending-on-features-ad-tools.html

Questions for Discussions:

  • Summarize the financial analysis presented in this report for Facebook.
  • Explain the reasoning for the increase in expenses and subsequent drop in profitability.
  • Do you believe the spending will eventually prove to be successful?
  • Would you be a buyer of the company today?

 

What’s behind the bull market

Posted by & filed under Economic Analysis, Growth & Valuation, Market Analysis.

Description:  U.S. stocks are flirting with all-time highs, climbing to levels not seen since before the financial crisis.

Source:  CNNMoney.com

Date: Jan 31, 2013

Link: http://money.cnn.com/2013/01/31/investing/stocks-bull-market/index.html?iid=Lead

Questions for Discussions:

  • What are the explanations for the bull market and return to 2007 market levels?
  • What are the concerns going forward?
  • What is your view of the current situation and where do you forecast stock prices heading over the next 12 months?