Wall Street Brief: Barclays Chief BAILS, Google Declares WAR on Apple
Barclays (NYSE:BCS) CEO Bob Diamond caved to political pressure and resigned amid the Libor manipulation scandal. The news may come as a surprise to investors after Diamond said on Monday he was going to “fight back” and tell some negative details about regulators. The company’s chairman, Marcus Agius, is also supposed to resign but he will stay and assist in the hunt for a new CEO.
Microsoft’s (NASDAQ:MSFT) money-losing Online Services division will take a $6.2 billion non-cash hit and primarily write down its 2007 $6.3 billion acquisition of the Internet ad agency aQuantive. Analysts see Microsoft making a $5.25 billion net profit in the fourth quarter but with the charge, the company could instead incur a loss for the period.
Samsung is attempting to respond to a U.S. Galaxy Nexus injunction and is “working closely” with Google (NASDAQ:GOOG) to develop a legal front against Apple (NASDAQ:AAPL), reported The Korea Times. Google’s patents acquired from Motorola Mobility could help with Samsung’s cause. Meanwhile, a judge rejected Samsung’s request to lift the ban on Galaxy Tab 10.1’s U.S. sales.
Groupon’s (NASDAQ:GRPN) Chairman and co-founder Eric Lefkofsky has cut his role at the company while increasing his time at the venture capital firm Lightbank. This news and a Susquehanna research note likely added to Groupon’s 10.5 percent selloff on Monday. Ongoing concerns about Groupon’s CEO Andrew Mason probably didn’t help matters.
BlackRock (NYSE:BLK) will acquire Swiss Re’s $7.5B private equity arm. This comes as the insurer consolidates business in response to new regulations on risk-asset holdings. The terms of the all-cash deal have not been disclosed, but BlackRock expects a third quarter close.
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Afternoon BUZZERS: Barclays CEO Resigns, Facebook-GM Chatter
Shares of Barclays PLC (NYSE:BCS) faded 2.04 percent by early Tuesday afternoon. The bank’s CEO Bob Diamond has resigned after the growing Libor scandal. “Bob Diamond was a lightning rod for the industry,” Chris Wheeler, bank analyst at Mediobanca, told CNBC. “I’m surprised at the timing, but I think there has been a discussion with the board about it having a major impact on Barclays and obviously they want to restore its reputation.”
Facebook (NASDAQ:FB) shares have gained 1.20 percent near the end of the abbreviated trading day. The social-media company appears to be back at the bargaining table with General Motors (NYSE:GM) over its advertising efforts. The WSJ reports, “Facebook Chief Operating Officer Sheryl Sandberg spoke with GM Chief Executive Daniel Akerson on the issue, and senior executives from both companies have been in discussions.”
Microsoft Corp. (NASDAQ:MSFT) shares recovered 0.24 percent this afternoon after slumping in the a.m. The company announced today it will take a $6.2 billion non-cash goodwill charge for the fourth-quarter of 2012, which is related to its purchase of online ad business aQuantive in 2007.
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Apple Inc. (NASDAQ:AAPL) shares were up more than 1 percent at midday. Pacific Crest Securities recently increased its price target for Apple, arguing the company will release a smaller-size iPad priced at $299 this fall to compete with new tablet devices from Google (NASDAQ:GOOG) and Amazon (NASDAQ:AMZN). The firm raised its price target for Apple from $630 to $690. “We anticipate an entry-level 7.85” iPad with 8GB of NAND capacity to price at $299 with an initial gross margin of 31 percent,” Pacific Crest analyst Andy Hargreaves wrote in a research note.
Research in Motion (NASDAQ:RIMM) shares fell 2 percent today. The company’s CEO Thorsten Heins claims, “There’s nothing wrong with the company as it exists right now.” He recognized that RIM faces obstacles in regaining market share, but said it is not in a “death spiral.”
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Modine Manufacturing NAMES new Regional VP and 3 Hot Analyst Insights
Modine Manufacturing Co. (NYSE:MOD) reported yesterday that Holger Schwab will take over the role of regional vice president – Europe. Previously, he worked 17 years at Valeo and was most recently that company’s vice president wiper systems, global, out of Paris. Shares are trading 3.19% higher today.
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Patriot Coal Corporation (NYSE:PCX): Tuesday’s trading saw paper and forest product shares as relative leaders, up on the day by around 33.33%. Verso Paper (NYSE:VRS) shares led, up around 47.86%, and Mercer mining shares were up on the day by around 3% as a group, with Patriot Coal as a leader (trading higher by approximately 13.8%) and Arch Coal (NYSE:ACI), trading higher by around 3.81%.
Microsoft Corporation (NASDAQ:MSFT): After Microsoft’s $1.2B deal for its competitor Yammer, Jive Software (NASDAQ:JIVE) is planned to appeal to potential acquirers, Bloomberg writes. Jive boasts the fastest sales growth in the applications software realm, and also supplies companies with social networking software to assist employees in communicating and working together on projects. As reported by Bloomberg based on a compilations of analysts’ estimates, Jive might post a 157% rise in revenue through 2014. Potential acquirers include SAP AG (NYSE:SAP) and Oracle (NASDAQ:ORCL). Shares of Microsoft are trading 0.65% higher today.
M*Modal (MODL): One Equity Partners reported late Monday it is purchasing tech services company M*Modal for around $1.1B. This $14/share agreement is an 8.3 percent premium to M*Modal’s close Monday. One Equity Partners is the private investment unit of JPMorgan.
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BofA APPROVES Preferred Stock Dividends and 4 Analyst Insights Not to Miss
Bank of America (NYSE:BAC) reported today that its Board of Directors authorized dividends on preferred stock. A quarterly cash dividend of $0.38775 per depositary share on the 6.204 percent Non-Cumulative Preferred Stock, Series D, can be payed on September 14, 2012 to shareholders of record as of August 31, 2012. Shares closed 0.12% higher today.
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Apple Inc. (NASDAQ:AAPL) is facing a new lawsuit from Chinese chemical company Jiangsu Xeubao that states it owns the rights to the Chinese language translation of “snow leopard,” The Next Web is reporting, citing M.I.C. Gadget. The trademark in question was filed by Jiangsu in the same year that Proview registered “iPad.” A hearing will be held July 10. Jiangsu is requesting a $80,645 settlement and “an apology.” Apple shares closed 1.16% higher today.
Facebook, Inc. (NASDAQ:FB): As the social networking site tries to get the most out of its profits, Facebook is aiming to purchase firms that work on its own platform, according to executive Amin Zoufonoun, who is focused notably on mobile. This strategy might be a motivation for some entrepreneurs but it also puts Facebook in the place of being a possible competitor to app developers. Shares of Facebook, Inc. closed 1.39% higher today.
Verizon (NYSE:VZ) filed a brief Monday in a suit against the FCC’s net neutrality regulations, The Hill reports. This brief states the FCC’s most recent net neutrality regulations go further than its past rules, which were struck down by a federal appeals court two years ago.
Nokia Corporation‘s (NYSE:NOK) new chairman says there is an alternative strategy in the wings in case Microsoft’s latest version of Windows Phone does not meet expectations, but he did not provide details. Shares of Nokia Corporation closed 0.47% lower today.
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Arena Tips Stock Scale Above $10 and 4 Analyst Insights You Must Know
Arena Pharmaceutical (NASDAQ:ARNA) increased 0.75% to $10.02 to close today’s abbreviated trading session, with over 15M shares traded, in comparison to its usual volume of 22M shares. In the last year, Arena share prices have seen a low of $1.23 and a high of $13.50, with a current price 708% above that low point, at $10.02. Investors appear mixed at $10 per share for the future potential of the first new diet drug approval in 13 years in Arena’s Lorcaserin.
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GlaxoSmithKline plc (NYSE:GSK) will pay $3B in criminal and civil fines and plead guilty to misdemeanor criminal charges in regard to the sale and promotion of its antidepressant medications Paxil and Wellbutrin, as well as the diabetes med Avandia, in the biggest health-care fraud settlement in American history. Shares of the drug maker are trading 0.78% lower today.
Sirius XM Radio (NASDAQ:SIRI) reported Tuesday that Academy Award and Grammy winning actor, artist and comedian Jamie Foxx will bring his comedy and entertainment SiriusXM channel The Foxxhole to Atlantic City for the July 4th holiday weekend.
Freeport-McMoRan Copper & Gold (NYSE:FCX): The Phoenix-based mining company will pay $6.8M to address natural resource damages at the Morenci Mine. This settlement will be employed in restoring and rehabilitating natural flora and fauna populations near the Clifton and Morenci communities and the border of New Mexico, according to a representative.
Barclays PLC (NYSE:BCS) CEO and director Bob Diamond has resigned, effective immediately. The search for a new CEO will be led by outgoing chairman Marcus Agius. Shares are trading 2.04% lower today.
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RADAR Movers: Apple Kisses $600, RIM and Barclays Still Struggling
In the shortened trading day, Apple Inc. (NASDAQ:AAPL) shares closed 1.16 percent higher at $599.41. Shares hit as high as $600 during intra-day trading, hitting the mark for the first-time since April.
Research in Motion (NASDAQ:RIMM) continues to search for a bottom. Shares closed Tuesday nearly 2 percent lower at $7.35. The company’s CEO Thorsten Heins claims, “There’s nothing wrong with the company as it exists right now.” He recognized that RIM faces obstacles in regaining market share, but said it is not in a “death spiral.” Last week, the BlackBerry maker reported horrendous financial results. Revenue plunged 43 percent to $2.81 billion. For the first-quarter, the company posted an adjusted loss of $192 million (37 cents per share), down sharply from a net gain of $695 million ($1.33 per share) a year earlier. Read More.
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Shares of Barclays PLC (NYSE:BCS) dropped 2.14 percent today. The bank’s CEO Bob Diamond has resigned after the growing Libor scandal. “Bob Diamond was a lightning rod for the industry,” Chris Wheeler, bank analyst at Mediobanca, told CNBC. “I’m surprised at the timing, but I think there has been a discussion with the board about it having a major impact on Barclays and obviously they want to restore its reputation.”
Facebook (NASDAQ:FB) shares closed 1.39 percent higher on Tuesday. The social-media company appears to be back at the bargaining table with General Motors (NYSE:GM) over its advertising efforts. The WSJ reports, “Facebook Chief Operating Officer Sheryl Sandberg spoke with GM Chief Executive Daniel Akerson on the issue, and senior executives from both companies have been in discussions.”
Investor Insight: BARCLAYS: The Latest Diamond in the Rough to Receive a HOT POTATO