|Bid||0.00 x 800|
|Ask||0.00 x 800|
|Day's range||212.50 - 216.05|
|52-week range||143.43 - 222.75|
|Beta (5Y monthly)||1.06|
|PE ratio (TTM)||34.35|
|Earnings date||28 Jan 2020|
|Forward dividend & yield||N/A (N/A)|
|1y target est||248.83|
Berkshire Hathaway landed on millennials’ top 10 list of investments in the fourth quarter of 2019, according to new research.
SHANGHAI/SEOUL (Reuters) - Facebook Inc and other global companies including LG Electronics Inc and Standard Chartered Plc are restricting travel to China, as the death toll from a flu-like virus rose above 100 on Tuesday. Airlines are also cancelling flights and adjusting schedules as a growing number of countries raise travel warnings to not just Hubei province where the new coronavirus broke out, but also to the rest of mainland China. The United States warned on Monday that Americans should "reconsider" visiting all of China, while South Korea elevated its travel warning on Tuesday, advising its citizens to refrain from visiting China.
(Bloomberg) -- Apple Inc.’s China-centric manufacturing base is at risk of disruption after the Lunar New Year holiday as the company’s partners confront the coronavirus outbreak that has gripped the country and caused more than 100 deaths.Virtually all of the world’s iPhones are made in China, primarily by Foxconn’s Hon Hai Precision Industry Co. at its so-called iPhone City in Zhengzhou and by Pegatron Corp. at an assembly site near Shanghai. Each of those locations is more than 500 kilometers away from Wuhan in central China, the epicenter of the viral outbreak, but that distance doesn’t immunize them from its effects.“I can’t imagine a scenario where the supply chain isn’t disrupted,” said veteran industry analyst Patrick Moorhead of Moor Insights & Strategy. “If there’s one major hiccup in the raw materials, fabrication, assembly, test, and shipping, it will be a disruption.”Apple has been increasing production to meet higher-than-anticipated iPhone demand, Bloomberg News reported last week. The company typically launches its new high-end iPhones around September, so the virus is unlikely to have meaningful impact on those plans, however the company is also preparing to begin mass production of a new low-cost iPhone in February, which is more at risk.Apple has roughly 10,000 direct employees in China, across its retail and corporate entities. Its supply chain also has a few million workers manufacturing products like the iPad, iPhone and Apple Watch. Many of those employees have been home the past few days for the holiday, and the company hasn’t said if it is asking them to stay home for longer to prevent the virus spreading. Chinese authorities have imposed severe travel restrictions and taken the drastic step of quarantining the entire city of Wuhan, a population of more than 11 million.“Supply chain disruption is a worry if employees across Foxconn and other component manufacturing hubs in China are restricted,” said analyst Dan Ives of Wedbush Securities Inc. “If the China outbreak becomes more spread it could negatively impact the supply chain which would be a major investor worry.”An Apple spokeswoman declined a request for comment.Foxconn said it is monitoring the situation in China and following all recommended health practices. It declined to comment on production in specific locations but said, “We can confirm that we have measures in place to ensure that we can continue to meet all global manufacturing obligations.”Confirmed cases of the coronavirus are rising in Henan province -- home to Zhengzhou facility -- which may lead Hon Hai or the government to close factories to prevent further contamination, Bloomberg Intelligence analyst Matthew Kanterman wrote. The province accounted for a quarter of China’s smartphone exports last year, while China’s exports make up 27% of global smartphone sales, he said, citing government and IDC data. Foxconn is estimated to account for more than 60% of Henan’s total trade.The Cupertino, California-based company prepares for extreme scenarios such as the coronavirus by mandating that major components be dual-sourced -- both in terms of vendors and geography -- and a major immediate impact to its production plans is unlikely for now, according to a person familiar with its operations. Even so, the vast majority of its assembly work is done in China, and so a shortage of workers for assembly lines will have a direct impact on shipment numbers.Apple put the redundancy policy in place after the 2011 earthquake and tsunami that hit Japan and led to component constraints for the iPad 2 that the company launched that year.While Apple doesn’t have any stores in Wuhan, it does have dozens of retail locations across the Chinese mainland. The company hasn’t announced any closures yet, however it has shortened the opening hours of several stores in the country through Feb. 7, according to a review of its retail website. That shift could be due to the Chinese government extending the lunar holiday as a means to control the virus.Along with its local workforce, Apple also relies on many of its U.S. staff going back and forth across the Pacific Ocean, with United Airlines Inc. last year revealing the company was spending $35 million per year flying employees between San Francisco and Shanghai alone. That included 50 daily business-class seats, according to the airline. How the virus outbreak may affect the research and development efforts that those trips facilitate has yet to be established.Investors and analysts will be looking to Chief Executive Officer Tim Cook to make comments on the virus and its impact on Apple during Tuesday’s conference call to discuss the latest quarterly financial results. Cook tweeted over the weekend that Apple “will be donating to groups on the ground helping support all of those affected” by the virus.To contact the reporters on this story: Mark Gurman in Los Angeles at firstname.lastname@example.org;Debby Wu in Taipei at email@example.comTo contact the editors responsible for this story: Peter Elstrom at firstname.lastname@example.org, Vlad SavovFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Facebook Inc has asked employees to suspend non-essential travel to mainland China to prevent the spread of the coronavirus, a spokesman said on Tuesday. The company also told employees who had traveled to China to work from home. "Out of an abundance of caution, we have taken steps to protect the health and safety of our employees," a company spokesman told Reuters.
(Bloomberg) -- The official Twitter accounts for more than a dozen National Football League teams have been hacked, less than a week before the Super Bowl.Official verified Twitter Inc. accounts for a number of teams, including the Super Bowl-bound San Francisco 49ers and Kansas City Chiefs, no longer have profile photos on the social media service. A tweet sent by the official Green Bay Packers Twitter account reads, “We are here to Show people that everything is hackable,” and attributes the breach to a group called OurMine. Screen shots on Twitter show similar tweets were sent from other official team accounts, but have since been deleted.OurMine has previously been linked to other Twitter hacks, including on the account of Chief Executive Officer Jack Dorsey. In June 2016, OurMine claimed credit for breaking into Facebook Inc. CEO Mark Zuckerberg’s Twitter and Pinterest accounts. OurMine’s Twitter account was subsequently suspended. Another account mentioned in some of the tweets Monday, @OurM1ne, was suspended after the hack of the NFL teams.In December 2016, hacking team OurMine accessed Netflix Inc. and Marvel Entertainment LLC’s Twitter accounts and posted the message, “Hey, it’s OurMine, Don’t worry we are just testing your security, contact us to help you with your security.”A Twitter spokeswoman confirmed the NFL accounts were hacked, and said the company has locked the accounts and is investigating further. Later Monday, a second Twitter spokeswoman added that “the accounts were hacked through a third-party platform” used to manage the accounts.The NFL, whose account was also hacked, didn’t immediately respond to a request for comment.It’s the second straight day that NFL teams were targeted on the site -- notable in part because the league’s championship game is set for Feb. 2 in Miami. On Sunday, the day of the annual Pro Bowl, hackers trolled some fans of the Chicago Bears after taking over the team’s official Twitter account. The hackers tweeted that the team had been sold, and also that it had traded away its best player.“Yes, our official team Twitter account was compromised yesterday,” a spokesman for the team said. “We worked directly with Twitter to rectify it in about an hour or so.”(Updates with Twitter statement on third-party platform in the fifth paragraph.)\--With assistance from Kartikay Mehrotra and Eben Novy-Williams.To contact the reporter on this story: Kurt Wagner in San Francisco at email@example.comTo contact the editors responsible for this story: Jillian Ward at firstname.lastname@example.org, Andrew PollackFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Facebook Inc. started restricting employee travel to China as the deadly coronavirus continues to spread across the world’s most populous country, according to people familiar with the decision.The limits, which went into effect Monday, halt non-essential travel to China by all Facebook employees. If workers have to visit the country, they need specific approval. Facebook staff based in China, and those who recently returned from trips to the country, are also being told to work from home, said the people, who asked not to be identified discussing private communications. The company declined to comment.Honda Evacuates, Starbucks Stores Shut: Virus Impact on BusinessThe travel restrictions at the social media company are likely to impact its hardware division, which sells devices such as the Portal video chat hub and Oculus virtual reality headsets. Hardware requires frequent travel from the company’s Silicon Valley offices to China, where engineers and managers oversee product development, meet with suppliers and transport prototypes.Facebook’s current products likely won’t be impacted, but the move could cause engineering delays on future devices, one of the people said. The company is looking to other facilities that it has in Vietnam to pick up any work that can’t be done in China, the person added.While Facebook is one of the smaller hardware makers among the U.S. technology giants, its plight underscores the potential impact of the virus on the industry. The majority of Apple Inc.’s vast supply chain is in China and other parts of Asia. Amazon.com Inc. and Alphabet Inc.’s Google also make their devices in the region.To contact the reporters on this story: Mark Gurman in Los Angeles at email@example.com;Kurt Wagner in San Francisco at firstname.lastname@example.orgTo contact the editors responsible for this story: Tom Giles at email@example.com, Alistair BarrFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Amazon stock has fallen over 4% in the last six months. It appears that investors are worried about Amazon's profit. But how long will Amazon stock stay stagnant as the e-commerce powerhouse spends to speed up its delivery?
Investors need to know what to expect from Facebook's Q4 financial results and beyond to help understand what might be next for Facebook stock...
On today's episode of Full Court Finance here at Zacks, we dive into everything investors need to know about Apple and Microsoft stock to help figure out if either tech giant is worth buying heading into quarterly earnings...
(Bloomberg) -- If it turns out that Saudi Arabia hacked into the phone of Amazon.com Chief Executive Officer Jeff Bezos, as investigators have alleged, the oil rich nation likely utilized its preferred method of cyber espionage: outsourcing.While countries like Russia, China and North Korea have invested in developing powerful, tailored cyber weapons, Saudi Arabia has instead opted to purchase them, according to experts and former government officials.The Middle Eastern nation’s cyber arsenal is believed to be primarily composed of outsourced espionage tools, which it has combined with disinformation tactics on social media, they said.These purchased weapons can be “highly sophisticated, but of limited scope,” according to Jon Bateman, a cybersecurity fellow at the Carnegie Endowment for International Peace. While Saudi Arabia has tools that can be technically complex, countries that have invested in developing indigenous offensive and defensive capabilities -- such as Saudi Arabia’s Middle Eastern neighbors Iran and Israel -- possess a greater range of cyber weapons and tactics, he said.Nevertheless, Saudi Arabia’s purchased tools are an effective way for the regime to exert control, allegedly deploying these tools to spy on Saudi dissidents and journalists, according to experts.The Embassy of Saudi Arabia didn’t immediately respond to a request for comment sent through its website form. Last week the Embassy denied involvement in the Bezos incident.In recent years, as cyber actors have generally grown more sophisticated, so have the tools for sale, said Andrew Grotto, a fellow at Stanford University who served as the senior director for cybersecurity policy on the National Security Council from late 2015 to mid-2017.The purchase of cyber weapons -- including from marketplaces in the Middle East and Europe, and possibly from criminals -- isn’t unique to Saudi Arabia, experts say. Other countries, such as Vietnam and the United Arab Emirates, have also utilized their defense budgets to outsource cyber arsenals.The embassy of Vietnam didn’t immediately respond to a request for comment, nor did the UAE embassy.Estimates for the start of Saudi Arabia’s purchasing of cyber tools range anywhere from half a decade to two decades ago, with the country appearing to focus on surveillance activities. While cyber tools can be used to delete or alter data, hold systems hostage and disrupt traffic, Saudi Arabia has primarily focused on using them for spying, the experts said.As Saudi Arabia has purchased offensive capabilities, the country’s defenses have also been put to the test, experts said. For example, a dramatic cyber-attack -- believed to be sponsored by Iran -- devastated the computers of the state oil company, Saudi Aramco, in 2012.These allegedly weak defenses can be problematic for American interests, as attacks on allies can be used as an indirect way to impact the U.S., said James Lewis, senior vice president at the Center for Strategic & International Studies.“The Saudis are not that sophisticated in their cyber capabilities and that has been a problem for the U.S.,” Lewis said. “What they are sophisticated in is the ability to buy outside capabilities.”In addition to purchasing cyber capabilities, Saudi Arabia has also become adept at deploying disinformation campaigns to promote national interests, according to experts.For example, in August, Facebook Inc. removed hundreds of government-linked accounts and pages engaged in a sophisticated and wide-reaching influence campaign that praised the regime and criticized neighboring countries. Two months later, Twitter Inc. removed thousands of state-backed accounts based in Saudi Arabia -- suspending tens of thousands of others -- which manipulated the platform in order to promote Saudi Arabia’s geopolitical interests and amplify support for its authorities.The spyware allegedly used to hack Bezos’s phone was “developed and marketed by a private company and transferred to a government without judicial control of its use,” according to two United Nations special rapporteurs, in a statement last week. The alleged purpose was to “influence, if not silence,” coverage of the Saudi regime by the Bezos-owned Washington Post, according to the rapporteurs.“The intrusion likely was undertaken through the use of a prominent spyware product identified in other Saudi surveillance cases,” such as tools purchased from Israel’s NSO Group or Italy’s Hacking Team, according to the statement.The allegations come following a December 2018 suit, in which Saudi dissident Omar Abdulaziz alleged NSO Group software enabled Saudi Arabia to hack his phone and track his communications with Jamal Khashoggi, a Washington Post journalist, and Saudi insider-turned-critic, who was slain by agents of the Saudi government, according to the U.S..Memento Labs, which acquired Hacking Team last year, didn’t immediately respond to request for comment; it has previously denied any involvement in the Bezos incident. An NSO Group representative referred to a statement published on its website: “We can say unequivocally that our technology was not used in this instance.” Regarding the lawsuit, a NSO Group spokesman said, “Khashoggi was not targeted by any NSO product or technology.”In a manner typical of Saudi’s digital operations, the murder of Khashoggi was followed by a “massive online campaign” that targeted Bezos’s business interests on social media, according to the U.N. rapporteurs. The following month, in November 2018, “Boycott Amazon” trended as the top hashtag on Saudi Twitter, they said.To contact the reporter on this story: Alyza Sebenius in Washington at firstname.lastname@example.orgTo contact the editors responsible for this story: Andrew Martin at email@example.com, Molly SchuetzFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The FAANG stocks have been outperforming the market over the past three months buoyed by the initial U.S.-China trade deal. Hopes of better-than-expected earnings releases are also adding to the strength.
(Bloomberg Opinion) -- The most recent retail sales data provides a glimpse into the mind of the U.S. consumer.The latest monthly retail sales report from the U.S. Census Bureau recorded December sales (excluding gasoline, automobiles and restaurants) of $384.6 billion. Compared with the prior year’s $ 360.5 billion, that’s a solid year-over-year gain of 6.7%. Sales in November 2019 were $330.2 billion for a 1.1% gain over 2018’s $325.9 billion. Average these two-monthly totals and you get a 4.1% year over year gain for the holiday-shopping period.Those are strong numbers. Delving deeper reveals several interesting data points:\-- consumer sentiment has fully recovered from the lows after the financial crisis and is back to levels that prevailed in mid-2000s;\-- sentiment is still below the frothy dot-com peak of the late 1990s, suggesting that consumers are confident about the future but not in a reckless or unsustainable way;\-- consumer debt relative to disposable income remains at the lowest level in at least four decades, indicating that there's room for them to spend more:These three data points suggest that the next few quarters of gross domestic product growth, retail sales and durable goods orders are likely to be robust.In the typical election year, these economic positives tend to benefit the White House incumbent. I will let others debate whether this is a typical election year.Two other interesting issues worth mentioning: Online sales measured by point-of-sale credit-card transactions from MasterCard’s SpendingPulse showed that e-commerce in 2019 reached all-time highs. E-commerce now accounts for 14% of U.S. retail sales and likely will continue to claim a growing piece of the pie. Worldwide, online sales have nearly tripled during the past five years from $1.3 trillion in 2014 to more than $3.5 trillion in 2019, according to Statista. Projections are for this to more than double during the next five years.One surprise from the MasterCard data is that online shopping is accelerating, rising 18.8% last year compared with 2018’s 18.4%. There are few signs online retail is slowing. If anything, the generation that grew up online doesn't think of e-commerce as anything special; it's simply retail.One other observation: Perhaps the most intriguing online retail outlet is Instagram’s Checkout. It was named 2019’s Technology of the Year by Mobile Marketer. Fashion site Glossy describes Instagram as the next big sales channel “for direct-to-consumer companies and traditional retailers alike.”More than just promoting a brand or product, Instagram is facilitating the sale of products directly to consumers. The company takes its slice of the transaction. Combine this with the lethally accurate algorithms deployed by parent company Facebook Inc. and you can imagine the sort of sales growth that might lie ahead.To give you an idea of the size of this marketplace, Instagram has more than 1 billion accounts active each month worldwide (Facebook has 2.45 billion active users). Most of them have some form of payment system, including credit cards, Venmo, PayPal or Apple Pay.So far, Instagram Checkout has been rolled out slowly since the platform introduced it in March. It has been testing product tags in posts since 2016. Again according to Glossy, tags came to “Instagram Stories” about two years later. The fashion site, quoting Instagram, reports that 130 million people tap a product tag to shop or see a price every month. Instagram is native to mobile, which is where the new generation of consumers spend most of their connected time. Although Instagram hasn't made a big splash in online retailing yet, the potential is there.To be sure, there are some inklings of problems with counterfeit goods. This has been an issue that has haunted both Amazon.com Inc. and eBay Inc. If Instagram wants to become a serious player in retail, it needs to nip this in the bud.Disruption doesn't sleep. Don’t be surprised if the incumbent stars of e-commerce -- the leading members of the last generation of disruptive technologies — become the new victims of creative destruction.The relative health of the American consumer makes the disruption all the more likely — and sooner rather than later.To contact the author of this story: Barry Ritholtz at firstname.lastname@example.orgTo contact the editor responsible for this story: James Greiff at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Barry Ritholtz is a Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Sign up for Bloomberg’s daily technology newsletter here.The last two weeks have been remarkably eventful for Jeff Bezos. First, the Amazon.com Inc. co-founder’s visit to India was met with street-side protests, a new antitrust investigation into “predatory pricing and unfair trade practices” and hostile comments from the government led by India Prime Minster Narendra Modi.Then last week, Bezos’s yearlong tangle with Saudi Arabia burst into the headlines, with cybersecurity investigators concluding with “medium to high confidence” that Bezos’s iPhone was hacked via a WhatsApp message sent directly from Crown Prince Mohammed bin Salman’s account.Those are two very different situations in two separate parts of the world. But they had something in common—an overly optimistic bet (that Amazon placed, along with its Big Tech brethren) on global leaders whose dispositions turned out to be less open and, to varying degrees, more autocratic than Silicon Valley originally thought.Amazon first bet big on India in 2014, when Bezos stood on the top of a flatbed truck in ceremonial Indian wedding garb and presented the chief of his local operation with an oversized $2 billion check. Bezos met with Modi on that trip and amid mutual goodwill, seemed to believe the prime minister would loosen India’s rigorous restrictions on how foreign-owned e-commerce companies could operate.Since then, regulations in India have actually become stricter, with Modi catering to his party’s base of small business owners by limiting Amazon’s ability to sell items directly and to control its own prices. While gaining market share from Walmart Inc.-owned rival Flipkart, Amazon’s marketplace division reported steep losses in the last full fiscal year. On Bezos’s latest trip, Modi reportedly declined to meet with him.Bezos’s relationship with Saudi Arabia started with similar hopes. According to last week’s reports, Bezos and Prince Mohammed met at a 2018 dinner party in Los Angeles and exchanged phone numbers. Buoyed by the crown prince’s promise of modernizing the desert kingdom and diversifying its oil-based economy, Amazon was angling to close a $2.2 billion deal to put three data centers in the country. But that arrangement was put on ice after Saudi agents killed Jamal Khashoggi, a columnist at the Bezos-owned Washington Post. Saudi officials have said the crown prince had no involvement in the murder of Khashoggi or the cyberattack on Bezos. Now a Twitter account linked to the Saudi government is advocating for an Amazon boycott.In each country, Amazon’s agenda was complicated by the regime’s bellicosity toward coverage in the Post. But the sharp decline of its fortunes in India and Saudi Arabia is also about leaders whose true colors were much darker than they originally seemed. India under Modi recently passed a restrictive citizenship law that prevents many undocumented Muslim migrants from becoming citizens, while allowing for applicants with different religious affiliations. The Saudi government under Prince Mohammed has fueled conflict in Yemen, persecuted religious and political dissidents and unleashed coordinated Twitter attacks and other cyber tactics on its perceived enemies.Amazon wasn’t alone in pinning unrealistic hopes on these leaders. India has proved similarly challenging for Facebook Inc. The country accounts for Facebook’s largest user base, but the government has tried to force the company to identify users of the encrypted WhatsApp messaging service and threatened to introduce restrictive new rules to regulate social media. And in 2018 the Saudi crown prince cultivated many tech leaders who would likely be wary of such photo ops today.It wasn’t too long ago that tech leaders were overly optimistic about China, too. Mark Zuckerberg did a fun run for the cameras in Beijing and a meet-and-greet with President Xi Jinping. Google thought it could sneak back into China, after famously withdrawing from the country in 2010, with its secretive Dragonfly search project.Back in what now seems a simpler time, tech companies thought the world was becoming more receptive to the economic bounties and democratizing halo of the internet. But the world, and these leaders, have veered starkly away from this brand of idealism. It turned out they didn't want to be friends with Silicon Valley after all.If you read one thingWhen tech leaders tried to understand why large companies have trouble embracing new technologies, they turned to Clayton Christensen, author of the seminal book, the Innovator’s Dilemma, and several sequels. Christensen died last week at age 67 of complications from cancer treatment, according to Utah’s Deseret News.And here’s what you need to know in global technology newsYouTube got the streaming rights to some of the biggest esports leagues. Google signed a deal with Activision Blizzard to carry Call of Duty and Overwatch competitions. The Call of Duty league debuted Friday with a three-day event in Minneapolis.Salesforce encouraged employees to buy and expense a copy of the co-founder’s new book. The software company sent a memo to its 48,000 workers last fall promoting the book, Trailblazer, and offering reimbursement. On its website, Salesforce describes the book as an “instant” bestseller.Airbnb sued a real estate developer it partnered with to build apartments. The suit accuses NDG and its chief of stealing at least $1 million. The venture has long been a source of controversy for Airbnb, which is expected to go public this year.To contact the author of this story: Brad Stone in San Francisco at firstname.lastname@example.orgTo contact the editor responsible for this story: Mark Milian at email@example.com, Anne VanderMeyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Strengthening Prime-enabled services and expanding AWS services portfolio are likely to reflect on Amazon's (AMZN) fourth-quarter results.
We have highlighted four red-hot tech stocks positioned to surpass earnings expectations as they gear up to announce their last round of financial results for calendar year 2019.
(Bloomberg Opinion) -- When the world’s competition police reflect on big tech’s dealmaking over the past 15 years, you could forgive them for wondering what might have been. If Facebook Inc. hadn’t acquired WhatsApp or Instagram, or if Google hadn’t bought YouTube or DoubleClick, would there be stronger competition for the two Silicon Valley firms?It certainly seems that regulators, particularly in the U.K., are eager to avoid repeat scenarios where companies grab outsize control of an emerging market before it’s clear exactly how important or big that market may be. That’s why a 6.1 billion-pound ($8 billion) food delivery takeover may have broader implications for tech giants’ dealmaking-to-come.Britain’s Competition and Markets Authority is reviewing the Dutch firm Takeaway.com NV’s planned acquisition of Just Eat Plc, the U.K.’s online marketplace for restaurant delivery. It’s a remarkable step, given that Takeaway.com no longer has a British business, and so the two firms don’t currently compete, at least not in the U.K. The regulator, the CMA, is instead pondering hypotheticals. It’s deliberating whether, without a deal, Takeaway.com might still otherwise enter the market and add a healthy dose of competition.The move underscores a recent approach that could make it more difficult for tech giants to make acquisitions, even small ones. (Together, they’ve bought more than 250 companies in the last six years.) Companies might not obviously compete with the firm acquiring them, but the U.K. watchdog is increasingly taking into account the possibility they could become a competitor at some later stage. It seems to have listened to the findings of the government-commissioned review into digital competition last year by Jason Furman, previously economic adviser to former U.S. President Barack Obama, which recommended that the CMA should take “more frequent and firmer action to challenge mergers that could be detrimental to consumer welfare through reducing future levels of innovation and competition.”Across the Atlantic, DNA-sequencing firm Illumina Inc.’s scuppered $1.2 billion acquisition of smaller peer Pacific Biosciences of California Inc. also illustrates the challenge. Both firms are active in slightly different parts of the market, so do not directly compete: Illumina currently focuses on so-called short-read sequencing platforms, while PacBio’s expertise is in long-reads. Yet antitrust authorities in both the U.K. and U.S. pushed back against the deal because of concerns that Illumina would decide against developing its own long-read offering further down the line, according to Bloomberg Intelligence analyst Aitor Ortiz. The firms called the deal off earlier this month.It’s healthy that technology deals are likely to attract more scrutiny. Acquisitions sometimes look like a catch-and-kill strategy: buying a startup that could become a rival before it's able to do so without necessarily using it to augment the business directly. For example, back in 2017, Facebook bought the fast-growing teen app tbh, before shutting it down just eight months later, citing low usage.But doing so presents a potential challenge for the CMA: ensuring that the U.K. remains an attractive place to found technology firms. Venture capitalists and big companies themselves often argue that a lot of startups are founded with the intention of ultimately selling themselves to a larger rival. If that exit strategy disappears, runs the argument, then they might decide to set up shop elsewhere.So far, it’s too early to determine whether that argument has any merit. And analysts still expect the Takeaway.com-Just Eat deal to complete, albeit with a slight delay. But because the CMA has the authority to impose remedies without a court case, unlike the U.S.’s Federal Trade Commission, technology firms have good reason to be wary.To contact the author of this story: Alex Webb at firstname.lastname@example.orgTo contact the editor responsible for this story: Melissa Pozsgay at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Alex Webb is a Bloomberg Opinion columnist covering Europe's technology, media and communications industries. He previously covered Apple and other technology companies for Bloomberg News in San Francisco.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- Investors continue to pour funds into passive investment products that aim to replicate the performance of benchmark indexes. They’re also increasingly keen that their money gets used to influence corporations to stop damaging the planet and improve social inclusiveness. Unfortunately, many of the products designed to achieve both objectives currently fall short on the goal of responsible investing.The shift in emphasizing environmental, social and governance issues puts pressure on the index providers to come up with benchmarks that more accurately reflect the concerns investors are attempting to express by allocating capital to ESG investment products. Currently, though, even dedicated ESG indexes have shortcomings that many investors are probably unaware of.The U.S. Vegan Climate exchange-traded fund, for example, tracks a $124 billion index created by Beyond Investing that excludes companies engaged in a laundry list of potentially harmful activities, including animal exploitation, human rights abuses and fossil fuels extraction. While the $14 million ETF’s top five holdings — Apple Inc., Microsoft Corp., Facebook Inc., Visa Inc. and Mastercard Inc. — may all meet those criteria, they’re hardly the first names that spring to mind when thinking about the words vegan or climate. And there are many other examples.BlackRock Inc.’s announcement this month that it plans to prioritize sustainability in its investment decisions highlights the issue confronting index trackers. With two-thirds of its $7.4 trillion of assets managed passively, the world’s biggest asset manager acknowledged that the bulk of its cash isn’t available to pursue those goals. Harnessing that firepower will become increasingly important if the passive industry is to meet the ESG aspirations of its growing customer base.It’s even likely to radically change the industry, and sooner than people realize. To that point, Hiro Mizuno, the chief investment officer of Japan’s $1.6 trillion Global Pension Investment Fund, says the days are over when it’s enough for passive fund managers to compete simply on providing the lowest tracking errors at the lowest cost. Now they have to add value too. “The main battlefield among our passive managers is going to be in the stewardship area.” he told the Financial Times last month. BlackRock is far from alone in shifting to a more moral investing stance. A survey of 300 institutional investors, financial advisers and fund managers that use ETFs published on Monday by Brown Brothers Harriman & Co. showed that almost three-quarters of respondents expect to increase the amount allocated to ESG investments in the coming year.European participants in the BBH survey ranked ESG-themed products as the ETF category they would most like to see more supply of, while Chinese investors ranked the sector as their second most desired area of expansion, along with more funds designed to track core indexes.Money is flooding into the sector. ESG-designated assets were the fastest-growing category of ETFs listed on Deutsche Boerse AG’s Xetra market last year, with investments more than tripling to more than 23 billion euros ($25 billion). Globally, ESG ETFs have enjoyed net inflows for 52 consecutive weeks, taking in $30 billion in the past year and garnering almost $3.4 billion in the week ended Jan. 20, according to data compiled by Bloomberg LP, which competes in selling index data to investors.There are two main routes whereby ETF providers can meet the implicit demands of clients allocating money to passively managed ESG products. The first is to use their collective muscle to prompt index providers to increase the granularity of the benchmarks used to shape asset allocations. Improving the discrimination of ESG indexes would go a long way to ensuring investors aren’t being hoodwinked into products that aren’t as green or socially savvy as they first appear.The second is trickier. Excluding companies deemed to be damaging the environment or being socially irresponsibly isn’t enough to move the needle. Engaging with the boards of those firms and using the clout of a shareholding to force them to change their ways is much more effective.But that costs money, and the success of the ETF model has been founded in large part on its ability to charge ultra-low fees. If BlackRock and its peers are serious about taking their social responsibilities more seriously, investors will have to pay for the privilege — and the sellers of index trackers will need to be honest about the increased cost of that kind of activism. Let’s hope the buyers of the products decide it’s a price worth paying to do good.To contact the author of this story: Mark Gilbert at firstname.lastname@example.orgTo contact the editor responsible for this story: Melissa Pozsgay at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of "Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable."For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Italy’s Matteo Salvini suffered a stinging loss in a key regional vote, providing a much-needed boost to Prime Minister Giuseppe Conte’s fragile government and making a snap general election less likely.Interior Ministry figures showed a center-left bloc led by the Democratic Party, or PD -- a partner in Conte’s ruling coalition -- at 51.3% in Emilia-Romagna, a long-time leftist stronghold. A center-right group headed by Salvini’s anti-migrant League trailed at 43.8%.Salvini had hoped that taking Emilia-Romagna would deal a death blow to Conte’s government and force an early national election that he would likely win. Instead, Sunday’s defeat for the populist firebrand, after a failed power grab last year, settled nerves in the market and yields on Italian 10-year government fell the most since August 27.Investors have been closely watching the vote, spooked by the possibility that a Salvini government would clash with the European Union and give a prominent role to euroskeptic lawmakers within the ranks of his League party.Turnout at almost 70% appeared to favor the center-left. The anti-Salvini grassroots movement known as “the Sardines” had filled city squares in recent months and mobilized young voters.With their mission accomplished, the Sardines leaders said in a Facebook post that they plan to return to their normal lives and won’t be speaking to the media about the election.Meanwhile, support for the Five Star Movement, Conte’s main coalition partner which won more than a third of the votes in national elections in 2018, collapsed to about 5%, according to projections.The dismal result could shift the balance of power within the government, with Five Star possibly toning down its populist demands on issues from toll-road licenses to judicial reform. Five Star Foreign Minister Luigi Di Maio quit as party leader on the eve of the vote and the movement’s implosion seems set to accelerate.Democratic Party leader Nicola Zingaretti claimed victory in the early hours of Monday, saying that thwarting Salvini will give fresh impetus to Conte’s government, while warning that the balance of power could be changing in the coalition.“A bipolar system is coming back into play, with two main forces fighting over leadership,” the PD leader said, in comments cited by Ansa news agency. “The Movement finds itself faced with this dilemma, though I say this as an ally, not an adversary.”Conte plans to set out a detailed plan for his cabinet’s priorities in coming weeks, including tax cuts, boosting private and state investment and speeding up the sclerotic justice system.Salvini said he was proud that the election was close despite Emilia-Romagna being a traditional stronghold of the center-left. He could take comfort in the result in a separate, less significant vote in Calabria, where a rightist coalition led by the League comfortably defeated the incumbent Democrats. Polls had shown Salvini’s forces comfortably ahead in the southern region.Salvini, 46, campaigned tirelessly across prosperous Emilia-Romagna, with up to a dozen campaign stops a day. He even pledged to head straight for Conte’s official residence in Rome and serve him an eviction notice if his group won Sunday’s ballot.Salvini has been trying to cash in on the lead he’s held in national opinion polls since last summer, when he abandoned Conte’s first coalition. That ploy backfired when Conte managed to cobble together a new alliance without the League.Nationally, surveys show support for the League at about 31%, and for the three-way center-right bloc at 48%. The Democrats are at 19% while Five Star has 16%, half the score it achieved when it won the 2018 general election.(Updates with official figures in second paragraph “Sardines” in sixth, PD leader in ninth)\--With assistance from Caroline Alexander, Alberto Brambilla, Flavia Rotondi, Iain Rogers and Tommaso Ebhardt.To contact the reporters on this story: John Follain in Rome at firstname.lastname@example.org;Alessandro Speciale in Rome at email@example.comTo contact the editors responsible for this story: Ben Sills at firstname.lastname@example.org, Jerrold Colten, Dan LiefgreenFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Companies in the Nasdaq 100 are headed into earnings season with momentum that approaches the unprecedented, their value up by more than $1 trillion since October.Now the world finds out if the rally made any sense.Twenty-six constituents are due to report quarterly results next week, including three of the four biggest U.S. companies, over one blistering 48-hour stretch starting Tuesday. With trillion-dollar-plus market capitalizations and a doubling in Apple Inc. since 2018 to account for, it’s possible investors will be in a less-forgiving mood than usual.As things stand now, Nasdaq stocks are perched at the highest forward valuation since 2007 and investors are getting progressively less patient with failure. Already this reporting season, companies in the broader market whose sales and earnings trailed analyst estimates have seen their shares pummeled the next day by the most in five quarters.“The market isn’t going parabolic, but some of these tech stocks really have,” said Randy Frederick, a vice president of trading and derivatives at Charles Schwab. “If you miss the bar, you’re going to get punished, no question about that.”A four-day week before the landing of big tech earnings saw the Nasdaq 100 slip 0.4% as stocks wavered amid concern over the spread of a virus that started in China. Seven straight weeks of gains have pushed the index to 23 times its forecast earnings, about 30% higher than its 10-year average. That valuations are stretched doesn’t mean stocks can’t rally further. It does raise the drama headed into earnings season.The latest leg of the bull market has come at a time when overall earnings have stopped rising for most industries -- the reason valuations have swelled so much. While the index rose every quarter of 2019 in terms of price, profits fell in two and are now forecast to contract in a third. Given the Nasdaq surged 38%, investors have obviously been OK looking past those numbers. But any indication that 2020’s expectations are optimistic may be taken poorly by stock bulls.That dynamic is writ large in the tech industry, where earnings have dropped 3% or more in each of the past three quarters. Computer and software makers are expected to post a 0.8% profit contraction in the three months through December. Early returns have been encouraging. Texas Instruments, a bellwether for chip stocks, posted results that topped estimates. Intel Corp. reported sales guidance that came in above industry trends.Despite the recent quarterly hiccups, combined net income of five largest tech companies -- Apple, Amazon, Microsoft, Alphabet and Facebook -- totaled $40 billion in the third quarter, 38% above the same period two years ago.“Multiples have expanded, but quarter-over-quarter these companies continue to grow earnings and that’s the whole key,” said Gary Bradshaw, a Texas-based portfolio manager at Hodges Capital Management, who owns shares of Apple, Microsoft, Amazon and Facebook. “It’s one of the areas in the marketplace where you’re seeing good growth. This isn’t 1999 or 2000 when you were valuating those tech stocks on eyeballs.”The cost of falling short has risen as well. A broader gauge of tech, online retail and Internet services stocks dropped 0.9% the day after reporting a miss on second-quarter sales and earnings per share, data compiled by Credit Suisse show. In the third quarter, the average slump was 6.8%.Apple will release quarterly figures on Tuesday, and analysts are focused on how the firm fared during the holiday season and dealt with uncertainty around tariffs. Microsoft, up 62% since the start of 2019, reports Wednesday. Investors will see whether the demand for its cloud-computing programs remains strong. Facebook, which has rallied 66% over that stretch, reports the same day.“I’d expect a little more leadership out of value-oriented sectors, more economically sensitive parts of the market,” Jeff Kleintop, chief global investment strategist at Schwab Center for Financial Research, said by phone. “I think investors seem to be comfortable with sticking with the leaders that got them here, at least for the time being,”\--With assistance from Wendy Soong.To contact the reporters on this story: Elena Popina in Hong Kong at email@example.com;Sarah Ponczek in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Brad Olesen at email@example.com, Chris Nagi, Richard RichtmyerFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.