Chip stocks are tanking after ‘depressing’ Broadcom earnings in a bad sign for market

Broadcom led a plunge in chip stocks Friday after the chipmaker missed revenue expectations and lowered guidance for 2019 citing a “broad-based” slowdown in demand and the U.S. crackdown on Huawei. The VanEck Vectors Semiconductor ETF (SMH) dropped 2.9% and was headed for its biggest decline in about a month. Broadcom’s revenue for the fiscal second quarter came in Thursday evening at $5.52 billion vs. the $5.68 billion expected by analysts polled by Refinitiv. The chipmaker also said it now exp


Broadcom led a plunge in chip stocks Friday after the chipmaker missed revenue expectations and lowered guidance for 2019 citing a “broad-based” slowdown in demand and the U.S. crackdown on Huawei. The VanEck Vectors Semiconductor ETF (SMH) dropped 2.9% and was headed for its biggest decline in about a month. Broadcom’s revenue for the fiscal second quarter came in Thursday evening at $5.52 billion vs. the $5.68 billion expected by analysts polled by Refinitiv. The chipmaker also said it now exp
Chip stocks are tanking after ‘depressing’ Broadcom earnings in a bad sign for market Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: john melloy
Keywords: news, cnbc, companies, customers, chip, broadbased, slowdown, market, billion, polled, broadcom, bad, demand, fiscal, tanking, sign, chipmaker, earnings, revenue, depressing, stocks


Chip stocks are tanking after 'depressing' Broadcom earnings in a bad sign for market

Broadcom led a plunge in chip stocks Friday after the chipmaker missed revenue expectations and lowered guidance for 2019 citing a “broad-based” slowdown in demand and the U.S. crackdown on Huawei.

Broadcom shares lost more than 9% in premarket trading Friday. Skyworks, Xilinx, Micron, Advanced Micro Devices, Nvidia and Qualcomm all followed suit with losses greater than 3%. Intel was down more than 2%. The VanEck Vectors Semiconductor ETF (SMH) dropped 2.9% and was headed for its biggest decline in about a month.

Broadcom’s revenue for the fiscal second quarter came in Thursday evening at $5.52 billion vs. the $5.68 billion expected by analysts polled by Refinitiv. The chipmaker also said it now expects $22.60 billion in revenue for fiscal 2019, well bellow the $24.31 billion seen by analysts polled by Refnitiv.

“We currently see a broad-based slowdown in the demand environment, which we believe is driven by continued geopolitical uncertainties, as well as the effects of export restrictions on one of our largest customers,” Broadcom CEO Hock Tan said in a statement. “As a result, our customers are actively reducing their inventory levels, and we are taking a conservative stance for the rest of the year.”


Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: john melloy
Keywords: news, cnbc, companies, customers, chip, broadbased, slowdown, market, billion, polled, broadcom, bad, demand, fiscal, tanking, sign, chipmaker, earnings, revenue, depressing, stocks


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Wall Street sees major growth potential for Luckin in untapped Chinese coffee market

Picture of a cup of coffee at a Luckin Coffee location. Fred Dufour | AFP | Getty ImagesBeijing-based coffee chain Luckin Coffee is catching the eye of Wall Street analysts who are hoping the newly public company’s technology-driven business model will fuel growth in an underpenetrated coffee market in China. Since Luckin was founded less than two years ago, the company has sold more than 110 million cups of coffee, according to Keybanc Capital Markets. Needham’s Vincent Yu has a buy rating on L


Picture of a cup of coffee at a Luckin Coffee location. Fred Dufour | AFP | Getty ImagesBeijing-based coffee chain Luckin Coffee is catching the eye of Wall Street analysts who are hoping the newly public company’s technology-driven business model will fuel growth in an underpenetrated coffee market in China. Since Luckin was founded less than two years ago, the company has sold more than 110 million cups of coffee, according to Keybanc Capital Markets. Needham’s Vincent Yu has a buy rating on L
Wall Street sees major growth potential for Luckin in untapped Chinese coffee market Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: maggie fitzgerald
Keywords: news, cnbc, companies, sees, coffee, china, major, 2019, rating, untapped, starbucks, market, stock, potential, street, luckin, growth, according, wall


Wall Street sees major growth potential for Luckin in untapped Chinese coffee market

Picture of a cup of coffee at a Luckin Coffee location. Fred Dufour | AFP | Getty Images

Beijing-based coffee chain Luckin Coffee is catching the eye of Wall Street analysts who are hoping the newly public company’s technology-driven business model will fuel growth in an underpenetrated coffee market in China. Luckin, which is the second-largest coffee chain in China, soared nearly 50% on its first day of trading on the Nasdaq in May. Despite the stock being down slightly since then, it has garnered quite a few favorable ratings from Wall Street. Since Luckin was founded less than two years ago, the company has sold more than 110 million cups of coffee, according to Keybanc Capital Markets. Luckin has opened 2,370 stores in its lifetime and plans to add 2,500 in 2019. More than 90% of its stores are smaller “pick-up” shops designed in close proximity to its customers.

Charles Zhengyao Lu, chairman and founder of Luckin Coffee Inc., center left, and Jenny Qian Zhiya, chief executive officer of Luckin Coffee Inc., center right, react as stocks start trading during the company’s initial public offering (IPO) at the Nasdaq MarketSite in New York, U.S., on Friday, May 17, 2019. Victor J. Blue | Bloomberg | Getty Images

Luckin says technology is the core of its business. The company uses big data analytics and AI to analyze its customers behavior and transaction data. Its self-developed mobile apps have given Luckin “significant advantages in cost and customer engagement to drive mass market coffee consumption in China” according to Credit Suisse, which has an outperform rating on the stock and a $24 target price. The stock ended the week just above $18. Similar to other fresh IPOs like Lyft, Uber, and Beyond Meat, Luckin is not yet a profitable company. In 2018, the chain reported net sales of $125.3 million and a net loss of $241.3 million. However, Needham expects the coffee chain’s profit to break even in the third quarter of 2019. Needham’s Vincent Yu has a buy rating on Luckin Coffee and a target price of $27.

China’s untapped coffee market

Luckin’s opportunity in China is “one of the world’s greatest retail growth opportunities,” according to KeyBanc Capital Markets, which has an overweight rating on the stock and a $22 price target. In a tea-dominated culture, coffee is a “highly underpenetrated” market in China, said Credit Suisse. Coffee sales in China are expected to grow significantly in the next few years, according to market research company Frost & Sullivan, which is cited by many of the analysts covering Luckin. “We forecast per capita consumption of freshly brewed coffee to accelerate from 1.6 cups per/year per capita in 2018 to 5.5 cups per capita per year in 2023,” the research firm said. The market has grown from 15.6 billion yuan in 2013 to 56.9 billion yuan in 2018, and is estimated to reach 180.6 billion yuan in 2030. This growth represents a 25% compound annual growth rate from 2018 to 2023, according to Frost & Sullivan. “We believe a faster pace of life, changing consumer habits (younger generation adopting a western lifestyle) and increasing disposable income will continue to drive the growth of the coffee market in China,” Credit Suisse’s Tony Wang said in a note to clients. Morgan Stanley, which calls Luckin’s stock “high quality, affordable and convenient,” expects Luckin to grow its sales by 30 times between 2018 and 2021, “driven by store expansion, strong customer growth” and “purchase frequency increase.” Morgan Stanley has an equal-weight rating on Luckin and a price target of $21. However, Bernstein, which doesn’t cover the stock, suggests China’s coffee market may never reach the expected levels. China’s current cup-per-capita rate is a fraction of Japan’s, Bernstein’s Sara Senatore said in a research note. “But at a similar stage of market development, Japan’s per capita rate was already 10x higher, suggesting China may never achieve coffee consumption rates that exist in present-day Japan,” Senatore noted.

A customer exits a Luckin Coffee outlet in Beijing, China, on Tuesday, Jan. 15, 2019. Gilles Sabrie/Bloomberg | Bloomberg | Getty Images

A threat to Starbucks

Luckin is attempting to overtake Starbucks as the largest coffee chain in China. Starbucks, which is celebrating its 20th anniversary in China this year, has been building its presence in the world’s second-largest economy for the past couple of decades. However, Luckin is expected to have more locations than Starbucks in China by the end of 2019, according to Stifel, which put a hold rating on Starbucks citing Luckin’s growth. In China, Starbucks is leading in the taste and mobile app categories in terms of sales drivers; however, competitors of Starbucks, which includes Luckin, are leading in the service, convenience and price categories, according to a Citi Research study. Luckin’s heavy discounting sets it apart from the world’s biggest coffee chain. KeyBanc Capital Markets suggests Luckin’s prices come at a 50% discount to Starbucks. Needham’s Vincent Yu said Starbucks’ high prices are “driving customers away” in China. Earlier this year, Starbucks chief Kevin Johnson said it is “unlikely” that Luckin surpasses Starbucks by the end of 2019.


Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: maggie fitzgerald
Keywords: news, cnbc, companies, sees, coffee, china, major, 2019, rating, untapped, starbucks, market, stock, potential, street, luckin, growth, according, wall


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How to take advantage of all the uncertainty with the stock market

Investors then exacerbated the losses because they were out of the market for the subsequent recovery. As the stock market swings amid tariff and trade war threats , you might get nervous about the effects on your 401(k) or other investments. “I truly believe it’s not timing the market, but time in the market that counts for increasing wealth, ” says Schultz. “But you have to be invested in the stock market or you won’t benefit.” Just as it’s a sure thing the stock market will decline in value,


Investors then exacerbated the losses because they were out of the market for the subsequent recovery. As the stock market swings amid tariff and trade war threats , you might get nervous about the effects on your 401(k) or other investments. “I truly believe it’s not timing the market, but time in the market that counts for increasing wealth, ” says Schultz. “But you have to be invested in the stock market or you won’t benefit.” Just as it’s a sure thing the stock market will decline in value,
How to take advantage of all the uncertainty with the stock market Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: alicia adamczyk
Keywords: news, cnbc, companies, schultz, sp, markets, stock, uncertainty, advantage, sell, points, losses, 401k, market, youre


How to take advantage of all the uncertainty with the stock market

Because the average investor withdrew funds when the market declined last year, they recorded losses of 9.42%, per the report, compared to just 4.38% for the S&P on the whole.

Behavior at the end of 2018 is a striking example. As the market soured in the final months of the year, investors pulled funds to mitigate losses, according to DALBAR’s 2018 Investor Behavior Study , but not nearly enough to avoid the full fall. Investors then exacerbated the losses because they were out of the market for the subsequent recovery.

As the stock market swings amid tariff and trade war threats , you might get nervous about the effects on your 401(k) or other investments. But a shaky market is no reason to stray from your financial plan.

Take the long view

If you’re saving for retirement through a 401(k) or IRA, then you’re investing for the long term. Movements in the market now shouldn’t matter much to you if you’re decades away from taking disbursements.

Some experts warn that a bear market is imminent. Even if that doesn’t turn out to be true — there’s no way to predict what the market will do with 100% accuracy — there will be a downturn eventually. Recognizing that should help you overcome urges to sell when things look bad, because the best thing you can do is to keep investing, Danielle Schultz, a certified financial planner, tells CNBC Make It. Embrace the uncertainty.

“I truly believe it’s not timing the market, but time in the market that counts for increasing wealth, ” says Schultz.

In fact, Schultz says young people should “pray for bad markets.” If you are contributing the same amount of money to a 401(k) or Roth IRA as you were when markets when higher, then you’re getting shares at what is effectively a discount.

“Of course this is terrible for retirees, but generally bad markets early in your career allow you to accumulate more shares at lower prices,” says Schultz. “But you have to be invested in the stock market or you won’t benefit.”

You also don’t want to miss out on the recovery. Just as it’s a sure thing the stock market will decline in value, historically it has always recovered. Take this example, from “Broke Millennial Takes on Investing,” by Erin Lowry:

Investors who stayed the course during the Great Recession were well rewarded in the decade following the crash. The Dow had dropped to 6,547 points in 2009, but it soared to new, prerecession highs by 2018, when it closed at more than 26,000 points. The S&P 500 index quadrupled during the bull run, from its low of 676 points in March 2009 to as high as 2,872 points in January 2018.

If you want a better picture of the true historical gains of the market over time, Schultz recommends looking up what the S&P 500 was on the day you were born, or at the bottom of the recession. Compare that to today for some perspective.

“The long term trend of the market is up, but it’s not steady,” she says.

The best way to avoid the market anxiety is to set up automatic contributions to your 401(k) or IRA, and forget about them. That takes emotion out of the equation when the market moves. Just ask Warren Buffett.

“Don’t watch the market closely, ” Buffett told CNBC in 2016. “If they’re trying to buy and sell stocks, and worry when they go down a little bit … and think they should maybe sell them when they go up, they’re not going to have very good results.”

Don’t miss: Why it’s a great time for millennials to contribute to a Roth IRA

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Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: alicia adamczyk
Keywords: news, cnbc, companies, schultz, sp, markets, stock, uncertainty, advantage, sell, points, losses, 401k, market, youre


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This chart shows why everyone on Wall Street is so worried about the yield curve

Take 2004 when the yield spread started falling from its highs. The flattening didn’t get the market’s attention until about 2006 when the curve inverted, and the recession hit exactly a year later. The current trend in the yield curve is likely to cap the upside for stocks in the next 12 months.” Keep in mind that Wang tested the spread between the 10-year and 2-year Treasury yields, not the 3-month and 10-year yield curve that’s currently inverted. The low benchmark rate has flattened the 2-ye


Take 2004 when the yield spread started falling from its highs. The flattening didn’t get the market’s attention until about 2006 when the curve inverted, and the recession hit exactly a year later. The current trend in the yield curve is likely to cap the upside for stocks in the next 12 months.” Keep in mind that Wang tested the spread between the 10-year and 2-year Treasury yields, not the 3-month and 10-year yield curve that’s currently inverted. The low benchmark rate has flattened the 2-ye
This chart shows why everyone on Wall Street is so worried about the yield curve Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: yun li
Keywords: news, cnbc, companies, sp, recession, inverted, hit, worried, market, chart, shows, yield, street, spread, 10year, wall, curve, yieldcurve


This chart shows why everyone on Wall Street is so worried about the yield curve

Wall Street’s top rated economist Ed Hyman just called the yield-curve inversion “the number one” market risk, and this chart shows why.

Going back to 1986, when the yield curve turned flatter drastically and eventually inverted, the S&P 500 tends to go into a downward spiral within the next 12 months, according to The Leuthold Group.

Take 2004 when the yield spread started falling from its highs. The flattening didn’t get the market’s attention until about 2006 when the curve inverted, and the recession hit exactly a year later.

There’s “a positive relationship between the yield curve and the S&P 500’s next 12-month returns,” said Chun Wang, Leuthold’s senior analyst and portfolio manager, in a note. “Recession or not, a flatter curve generally bodes ill for future stock market performance. The current trend in the yield curve is likely to cap the upside for stocks in the next 12 months.”

Keep in mind that Wang tested the spread between the 10-year and 2-year Treasury yields, not the 3-month and 10-year yield curve that’s currently inverted. Yield-curve inversion has been a reliable recession signal closely watched by experts and the Federal Reserve.

The shape of the curve is exuding a bad omen for the stock market if history is any guide. The yield on the 10-year Treasury hit a 20-month low last week as the escalated trade battles triggered a broad flight to safety. The low benchmark rate has flattened the 2-year/10-year yield curve to only about 23 basis points on Friday. In December, the spread hit the lowest level since the financial crisis during a massive sell-off. Yet despite the flattening, the S&P 500 is still up 15% this year.


Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: yun li
Keywords: news, cnbc, companies, sp, recession, inverted, hit, worried, market, chart, shows, yield, street, spread, 10year, wall, curve, yieldcurve


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The Fed won’t cut rates at its June meeting. Here’s why

Federal Reserve Chairman Jerome Powell holds a press conference following a two day Federal Open Market Committee policy meeting in Washington, January 30, 2019. “The Fed is going to look at the data, they’re going to look at what their models say. As things stand currently among Chairman Jerome Powell and his fellow Fed officials, no moves are indicated. He noted the “big divergence” between the market and Fed projections and said, “No cuts this year is hard to believe.” Fed officials have been


Federal Reserve Chairman Jerome Powell holds a press conference following a two day Federal Open Market Committee policy meeting in Washington, January 30, 2019. “The Fed is going to look at the data, they’re going to look at what their models say. As things stand currently among Chairman Jerome Powell and his fellow Fed officials, no moves are indicated. He noted the “big divergence” between the market and Fed projections and said, “No cuts this year is hard to believe.” Fed officials have been
The Fed won’t cut rates at its June meeting. Here’s why Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: jeff cox
Keywords: news, cnbc, companies, trade, going, policy, markets, meeting, officials, wont, fed, heres, cut, powell, market, rates


The Fed won't cut rates at its June meeting. Here's why

Federal Reserve Chairman Jerome Powell holds a press conference following a two day Federal Open Market Committee policy meeting in Washington, January 30, 2019. Leah Millis | Reuters

With pretty much everyone convinced that the Fed is going to be cutting interest rates at some point this year, the central bank faces one rather pressing question: Why wait? After all, the market already is pricing in at least reductions this year and probably three. Though the Federal Open Market Committee meets next week, there is little expectation of a move then. Not moving next week essentially comes down to three factors, according to Fed watchers: The looming G-20 summit at which the U.S. and China, at least theoretically, could reach a trade agreement; a desire not to be seen as overly influenced by the financial markets and President Donald Trump’s hectoring; and the desire to avoid making December’s rate hike look like a policy mistake.

“They don’t want to be seen as cowing to any sort of pressure, be it political from the White House or from the market,” said Lindsey Piegza, chief economist at Stifel. “The Fed is going to look at the data, they’re going to look at what their models say. To them, it doesn’t matter what the markets say.”

‘No cuts this year is hard to believe’

Wall Street, though, is clamoring for a cut. Futures pricing Friday afternoon in the fed funds market showed a 21% chance of a move at the June 18-19 meeting, down from 30% earlier in the day on some stronger-than-expected economic data. The chance of a July cut remained at 85%, while the market was figuring a 61% probability for three moves in total by the end of the year. As things stand currently among Chairman Jerome Powell and his fellow Fed officials, no moves are indicated. That is likely to change when FOMC members submit their economic projections at the June 18-19 meeting, which include the “dot plot” of individual members’ expectations of where rates are headed over the next few years. “I can’t imagine what they are going to do with the dots,” Jeffrey Gundlach, founder of DoubleLine Capital, said in a webcast Thursday. He noted the “big divergence” between the market and Fed projections and said, “No cuts this year is hard to believe.” In May, Gundlach recommended a straddle options trade that benefited from wide fluctuations in interest rates. The trade recently had netted a 22% gain. Fed officials have been under intense pressure from more than the markets. Trump has been a continuous nemesis to the central bank, most recently repeating his demand for lower rates and saying he’s “not happy with what [Powell has] done” as Fed chair. Along the same lines, the Fed has its credibility to worry about. Trump and a growing number of market participants view the December rate hike — the fourth of the year — as a policy mistake that came amid several pivots and missteps that caused Powell and other officials to change their public statements to assuage investors’ nerves.

‘A verbal intervention’


Company: cnbc, Activity: cnbc, Date: 2019-06-14  Authors: jeff cox
Keywords: news, cnbc, companies, trade, going, policy, markets, meeting, officials, wont, fed, heres, cut, powell, market, rates


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An activist has jumped into one of the biggest names in the golf business, boosting the shares

Callaway Golf soared in Thursday trading after activist investor Jana Partners disclosed a 9.2% stake in the company. Shares are “undervalued and represent an attractive investment opportunity,” Jana said in a filing with the Securities and Exchange Commission. It is, however, the Board and Mgmt’s practice to meet with shareholders to discuss the company’s strategy in accordance with SEC regulations,” a Callaway Golf spokesperson told CNBC. But since November 2018, around the time Callaway’s bid


Callaway Golf soared in Thursday trading after activist investor Jana Partners disclosed a 9.2% stake in the company. Shares are “undervalued and represent an attractive investment opportunity,” Jana said in a filing with the Securities and Exchange Commission. It is, however, the Board and Mgmt’s practice to meet with shareholders to discuss the company’s strategy in accordance with SEC regulations,” a Callaway Golf spokesperson told CNBC. But since November 2018, around the time Callaway’s bid
An activist has jumped into one of the biggest names in the golf business, boosting the shares Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: thomas franck
Keywords: news, cnbc, companies, jumped, company, jack, activist, golf, callaway, wolfskin, biggest, business, companys, market, shares, strategy, names, boosting, sales, callaways


An activist has jumped into one of the biggest names in the golf business, boosting the shares

Callaway Golf soared in Thursday trading after activist investor Jana Partners disclosed a 9.2% stake in the company.

Jana, founded by Barry Rosenstein in 2001, said it plans to discuss with Callaway selling all or part of the golf equipment and apparel maker despite what the activist acknowledged as successful innovation and durable market share in its core golf business.

The activist’s position would make it the company’s second-largest shareholder based on the most recent government filings.

Shares are “undervalued and represent an attractive investment opportunity,” Jana said in a filing with the Securities and Exchange Commission.

Jana “intends to have discussions with the [Callaway’s] board of directors and management regarding the Issuer’s portfolio composition; strategic alternatives including exploring a sale of the Issuer or asset divestitures; capital allocation and acquisition strategy; operating performance and cost management; and governance,” it added.

“It is not our practice to discuss individual shareholders. It is, however, the Board and Mgmt’s practice to meet with shareholders to discuss the company’s strategy in accordance with SEC regulations,” a Callaway Golf spokesperson told CNBC.

Despite Thursday’s sharp upswing, shares of Callaway have dogged the broader stock market in recent months, with much of the decline following the company’s acquisition of outdoor apparel brand Jack Wolfskin earlier this year. Though CEO Chip Brewer lauded the $476 million purchase in January as an opportunity to provide “an innovative product offering with long-term synergies,” investors have proven tougher to convince.

A quick glance at the stock shows an approximate 20% decline over the last 12 months through Wednesday’s close, though a closer look reveals that the golf supplier actually outpaced the S&P 500 in 2018 with a 9.8% climb. But since November 2018, around the time Callaway’s bid for Jack Wolfskin was announced, the S&P has returned 6.5% versus Callaway’s 27% fall.

Though the company reported record first-quarter net sales of $516 million last month, investors weren’t thrilled with the company’s reduced sales outlook for Jack Wolfskin, which Brewer said in May was the result of “much reported softer market conditions in Central Europe and China.” As a result, the company said it expects that Jack Wolfskin’s full-year 2019 net sales will be 4% to 6% below a prior estimate of $382 million.

The company also reported non-GAAP earnings per share of 63 cents in the first quarter of 2019, a decline of 2 cents compared to the first quarter of 2018. It said it saw sales in the U.S. rise 5.9% in the first quarter versus the year-ago period.

Nevertheless, the acquisition revealed a key component behind Callaway’s — and Brewer’s — long-term strategy. A leader in global golf equipment sales, the company has in recent years embarked on a brand-building sprint, including the X Hot and X2 Hot line of fairway woods and a reintroduction of the Big Bertha driver.

It’s also tried to bolster its standing in the golf ball segment with its Triple Tack Technology and new ERC golf ball, running into fierce competition from leader Titleist.

“Our U.S. market shares continue to set records,” Brewer said during the company’s first-quarter earnings call on May 9. “On the brand side, we’ve had a strong start to the year on Tour with multiple golf ball and driver wins across the globe. And as part of a new strategic initiative, we have earned the claim of being the new number one driver of major worldwide tours and we continue to be the number one putter on-tour.”


Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: thomas franck
Keywords: news, cnbc, companies, jumped, company, jack, activist, golf, callaway, wolfskin, biggest, business, companys, market, shares, strategy, names, boosting, sales, callaways


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IPOs are one of the hottest trades of the year, doubling the market’s return

The IPO market keeps getting hotter, but how much more juice is left? IPO unicorns this yearThe Renaissance Capital IPO ETF, a basket of the 60 or so most recent large IPOs, is up 34% this year, more than twice the performance of the S&P 500. “If you’ve got extremely fast growth and a market opportunity, investors are comfortable knowing that profits will come later,” said Matt Kennedy, who analyzes IPOs for Renaissance Capital. Of 64 IPOs that have priced this year, 25 (40%) have priced at the


The IPO market keeps getting hotter, but how much more juice is left? IPO unicorns this yearThe Renaissance Capital IPO ETF, a basket of the 60 or so most recent large IPOs, is up 34% this year, more than twice the performance of the S&P 500. “If you’ve got extremely fast growth and a market opportunity, investors are comfortable knowing that profits will come later,” said Matt Kennedy, who analyzes IPOs for Renaissance Capital. Of 64 IPOs that have priced this year, 25 (40%) have priced at the
IPOs are one of the hottest trades of the year, doubling the market’s return Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: bob pisani
Keywords: news, cnbc, companies, markets, return, hottest, growth, large, priced, ipos, trades, doubling, market, range, meat, ipo, fast, renaissance


IPOs are one of the hottest trades of the year, doubling the market's return

Ethan Brown, founder and chief executive officer of Beyond Meat Inc., center, rings the opening bell during the company’s initial public offering (IPO) at the Nasdaq MarketSite in New York, U.S., on Thursday, May 2, 2019.

The IPO market keeps getting hotter, but how much more juice is left? CrowdStrike Holdings, a cybersecurity company that a week ago was discussing going public at $19 to $23 a share, priced at $34 and opened at $63.50.

Pet e-tailer Chewy upsized its IPO ahead of its Friday debut.

They are not alone. In February, IPO watchers were fearful an avalanche of IPOs would cause a crash in the market, but the big tech unicorns have been winners so far.

IPO unicorns this year

The Renaissance Capital IPO ETF, a basket of the 60 or so most recent large IPOs, is up 34% this year, more than twice the performance of the S&P 500.

What’s going on? “If you’ve got extremely fast growth and a market opportunity, investors are comfortable knowing that profits will come later,” said Matt Kennedy, who analyzes IPOs for Renaissance Capital.

Surprisingly, prices are holding up well. Of 64 IPOs that have priced this year, 25 (40%) have priced at the high end of the range or above.

IPO pricings this year (64 IPOs)

Above range: 12

High end: 13

Midpoint: 18

Low end 11

Below range: 10

Source: Renaissance Capital

Kennedy noted that four of these companies — Beyond Meat, Zoom, CrowdStrike and PagerDuty — exhibited similar characteristics: fast growth and a large market opportunity.

Beyond Meat is disrupting the food industry. Zoom is profitable with a large market opportunity with video conferencing. Crowdstrike’s endpoint security business is also growing fast. Pinterest has a somewhat unique niche — not quite social media, more like a discovery play, and priced below its last round of funding.

The lone unicorn disappointments this year: Uber Technologies and Lyft, down 6% and 19% respectively. What do they lack the others have?

Kennedy noted that investors are not impressed with the economics of ride hailing — specifically, the deep losses. In addition, both suffered from valuation issues (neither had a successful publicly traded peer), and both priced well above their last round of funding.

Still, there’s nothing like an up market to boost IPOs. The S&P 500 is up 15% this year. That leaves these names vulnerable should there be a larger market downturn.

And one of the most appealing characteristics of the winners — rapid growth — could quickly turn against them.

“The risk is that they are priced to perfection, so if there is any slowing of growth expectations they will get hit hard,” Kennedy said.


Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: bob pisani
Keywords: news, cnbc, companies, markets, return, hottest, growth, large, priced, ipos, trades, doubling, market, range, meat, ipo, fast, renaissance


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Stocks moving after hours: Broadcom, Fiverr, chip stocks

The San Jose-based company reported earnings of $5.21 per share, excluding certain items, beating the $5.16 per share expected by analysts, according to Refinitiv. However, the reported $5.52 billion in revenue was below Refinitiv’s consensus estimate of $5.68 billion. Broadcom lowered its guidance for full-year revenue from $24.50 billion to $22.50 billion. Other chip stocks followed Broadcom into the red after hours. The company, which connects gig economy workers with jobs, saw its stock pric


The San Jose-based company reported earnings of $5.21 per share, excluding certain items, beating the $5.16 per share expected by analysts, according to Refinitiv. However, the reported $5.52 billion in revenue was below Refinitiv’s consensus estimate of $5.68 billion. Broadcom lowered its guidance for full-year revenue from $24.50 billion to $22.50 billion. Other chip stocks followed Broadcom into the red after hours. The company, which connects gig economy workers with jobs, saw its stock pric
Stocks moving after hours: Broadcom, Fiverr, chip stocks Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: jesse pound, lauren feiner
Keywords: news, cnbc, companies, market, fiverr, billion, analysts, reported, broadcom, share, refinitiv, moving, company, hours, chip, revenue, stocks


Stocks moving after hours: Broadcom, Fiverr, chip stocks

Check out the companies making headlines after the bell:

Shares of chipmaker Broadcom plunged 8% in extended trading Thursday after the company missed revenue expectations for the second quarter and lowered its revenue guidance for the full fiscal year. The San Jose-based company reported earnings of $5.21 per share, excluding certain items, beating the $5.16 per share expected by analysts, according to Refinitiv. However, the reported $5.52 billion in revenue was below Refinitiv’s consensus estimate of $5.68 billion.

Broadcom lowered its guidance for full-year revenue from $24.50 billion to $22.50 billion. Analysts expected $24.31 billion, according to Refinitiv. The company cited a U.S. ban on working with Chinese device giant Huawei in lowering its revenue outlook.

Other chip stocks followed Broadcom into the red after hours. Broadcom CEO Hock Tan said on a call with analysts that uncertainty in the industry extended beyond Huawei. Advanced Micro Devices, Micron Technology, Qualcomm and Nvidia all fell roughly 1.8%. Texas Instruments and Analog Devices fell more than 2.5% each.

Fiverr’s strong market debut continued after hours, as the company’s shares rose another 5.5%. The company, which connects gig economy workers with jobs, saw its stock price rise 90% during market hours in its first day on the public exchanges Thursday.


Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: jesse pound, lauren feiner
Keywords: news, cnbc, companies, market, fiverr, billion, analysts, reported, broadcom, share, refinitiv, moving, company, hours, chip, revenue, stocks


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How this Indian hotel chain plans to conquer the China market

Giulia Marchi | Bloomberg | Getty ImagesFor many foreign firms, China’s market is a notoriously tough nut to crack. Since OYO Rooms ventured into the Chinese market in November 2017, it has expanded at a breakneck pace. “We’re opening roughly 10 to 12 buildings a day in China,” Agarwal announced at the inaugural Skift Forum Asia. When OYO entered the Chinese market, the company viewed itself as local Chinese entrepreneurs “who were copying OYO Global,” he explained. “In short, OYO copied what OY


Giulia Marchi | Bloomberg | Getty ImagesFor many foreign firms, China’s market is a notoriously tough nut to crack. Since OYO Rooms ventured into the Chinese market in November 2017, it has expanded at a breakneck pace. “We’re opening roughly 10 to 12 buildings a day in China,” Agarwal announced at the inaugural Skift Forum Asia. When OYO entered the Chinese market, the company viewed itself as local Chinese entrepreneurs “who were copying OYO Global,” he explained. “In short, OYO copied what OY
How this Indian hotel chain plans to conquer the China market Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: shirley tay
Keywords: news, cnbc, companies, chinese, company, chinas, indian, plans, china, oyo, market, local, conquer, hotel, chain, agarwal, shih


How this Indian hotel chain plans to conquer the China market

A Chinese national flag flies in front of a building under construction in the central business district of Beijing, China. Giulia Marchi | Bloomberg | Getty Images

For many foreign firms, China’s market is a notoriously tough nut to crack. Tech giants such as Amazon, eBay and Uber — which have a significant market presence in the United States — all called it quits on China after finding themselves unable to survive the cutthroat competition with local firms there. But Indian budget hotel chain, On Your Own Rooms, managed to be the exception to the rule. The Softbank-backed hotel start-up was founded in India in 2013, and has since grown to become one of South Asia’s largest hotel and accommodation chains. Since OYO Rooms ventured into the Chinese market in November 2017, it has expanded at a breakneck pace. OYO Jiudian — its Chinese subsidiary — currently has nearly 10,000 hotels and 450,000 rooms across 320 cities under its name.

Why design a global company that will never be successful, versus a local entrepreneur? … That mindset enabled us to think two levels ahead of anybody else. Ritesh Agarwal chief executive officer of OYO Rooms

“In a brief period, we have emerged as the country’s second-largest hotel group and company,” Sam Shih, the chief operating officer of OYO Jiudian, told CNBC. China is the company’s biggest market today, OYO’s Chief Executive Officer Ritesh Agarwal said at a travel conference in Singapore in late May. “We’re opening roughly 10 to 12 buildings a day in China,” Agarwal announced at the inaugural Skift Forum Asia. He outlined two key traits of his business that allowed the company to reach the success it has in China’s market: strategic partnerships and a local entrepreneurial mindset.

Strong partnership

Agarwal said at the conference that the company has signed a “very strong, strategic partnership” with Ctrip, China’s largest online travel aggregator (OTA). “OYO Hotels used to distribute on Ctrip, but we had a very local traveler partnership — it was never really at a brand level,” Agarwal said. OYO’s “great working relationships” with prominent travel aggregators like Ctrip opens up new opportunities for the hotel chain and strengthens its reach to local communities, Shih told CNBC.

The OYO Dongxing Wenquan Hotel in Zhengzhou, China. OYO China

That partnership will help its Chinese subsidiary reach its goal of giving China’s middle-income population — estimated by the government to be about 400 million, or less than a third of the population — a “great living space” for less than 150 Chinese yuan ($21.71) per night, Shih added. “We’re excited by the possibilities of these mutually beneficial relationships,” he said.

Entrepreneurial mindset

OYO Jiudian’s success also stems from how it’s positioned itself in the world’s second-largest economy, Agarwal said. When OYO entered the Chinese market, the company viewed itself as local Chinese entrepreneurs “who were copying OYO Global,” he explained. “Why design a global company that will never be successful, versus a local entrepreneur? … That mindset enabled us to think two levels ahead of anybody else,” Agarwal said. With that in mind, the hotel chain “nativized” its offerings from the “point of view of a traveler in the country and what was lacking from his/her experience earlier when OYO was not around,” COO Shih said. “For instance, most foreign companies look at recruiting bilingual management teams in a different country,” he explained. “We didn’t make that a criterion because a Chinese company operating in the country wouldn’t have that constraint — and if we had that constraint, we would narrow our talent pool.” This helped the company to build a strong team of over 7,000 “OYOpreneurs” in China, with less than 20 of them English-speaking, he added. “In short, OYO copied what OYO itself has been executing since its inception in India to gain this momentum in China,” Shih said.

Big bets on China


Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: shirley tay
Keywords: news, cnbc, companies, chinese, company, chinas, indian, plans, china, oyo, market, local, conquer, hotel, chain, agarwal, shih


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Beyond Meat’s stock falls after former investor Tyson Foods announces plant-based nuggets

Shares of Beyond Meat fell about 4% in premarket trading Thursday after Tyson Foods announced plans to launch plant-based nuggets this summer. Since going public in early May, Beyond’s stock has soared 468%. But one early investor has missed out on the success of Beyond’s market debut: Tyson. Even with shares falling Thursday to around $137, Beyond’s stock price remains above the price targets of analysts, the highest of which is $123. Tyson’s announcement comes as Beyond faces increased competi


Shares of Beyond Meat fell about 4% in premarket trading Thursday after Tyson Foods announced plans to launch plant-based nuggets this summer. Since going public in early May, Beyond’s stock has soared 468%. But one early investor has missed out on the success of Beyond’s market debut: Tyson. Even with shares falling Thursday to around $137, Beyond’s stock price remains above the price targets of analysts, the highest of which is $123. Tyson’s announcement comes as Beyond faces increased competi
Beyond Meat’s stock falls after former investor Tyson Foods announces plant-based nuggets Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: amelia lucas
Keywords: news, cnbc, companies, stock, meats, company, tyson, offer, products, foods, investor, falls, plantbased, announces, nuggets, market, meat, beyonds, launch


Beyond Meat's stock falls after former investor Tyson Foods announces plant-based nuggets

Shares of Beyond Meat fell about 4% in premarket trading Thursday after Tyson Foods announced plans to launch plant-based nuggets this summer.

Since going public in early May, Beyond’s stock has soared 468%. Its market value is about $8.3 billion, roughly one-third that of Tyson, the nation’s largest meat producer.

But one early investor has missed out on the success of Beyond’s market debut: Tyson. The company sold its stake prior to Beyond’s initial public offering because it planned to offer its own meat alternative products. The meatpacker announced Thursday that it planned to launch imitation chicken nuggets this summer, as well as burger patties blending meat with vegetables in the fall.

Beyond does not currently offer any plant-based chicken products, but the company is working on a new and improved version of its chicken strips, which it pulled from grocery store shelves earlier this year.

Even with shares falling Thursday to around $137, Beyond’s stock price remains above the price targets of analysts, the highest of which is $123. No one on Wall Street recommends buying the stock anymore because of its hot streak. The stock has been gyrating as analysts have raised concern about its monster run and short sellers have taken an interest.

Tyson’s announcement comes as Beyond faces increased competition in the plant-based meat market. Nestle is planning to launch its own plant-based burger this fall in the U.S. under its Sweet Earth brand.

Credit Suisse analyst Robert Moskow wrote in a note Thursday that he does not view Tyson’s hybrid burgers as a major threat to Beyond.

“Although competing hybrid burgers offer less saturated fat than the 100% plant-based products from Beyond and Impossible, they simply don’t taste as good in our experience,” he wrote.

Euromonitor expects that the market for meat alternatives will hit $22.9 billion globally by 2023. Tyson said that alternative protein could be a billion-dollar business for the company someday. The flexitarian diet is driving that growth, with nearly 60% of U.S. consumers expressing interest in eating less meat, according to Mintel.

While Beyond has said that the company has enough capacity to handle projected demand for the next two years, Big Food companies like Tyson and Nestle have even more muscle when it comes to production and research and development.


Company: cnbc, Activity: cnbc, Date: 2019-06-13  Authors: amelia lucas
Keywords: news, cnbc, companies, stock, meats, company, tyson, offer, products, foods, investor, falls, plantbased, announces, nuggets, market, meat, beyonds, launch


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