90.85 0.00 (0.00%)
After hours: 4:24PM EDT
|Bid||90.40 x 800|
|Ask||91.12 x 800|
|Day's range||89.51 - 91.39|
|52-week range||66.60 - 98.64|
|Beta (5Y monthly)||N/A|
|PE ratio (TTM)||15.12|
|Earnings date||01 May 2020|
|Forward dividend & yield||1.00 (1.12%)|
|Ex-dividend date||28 Feb 2020|
|1y target est||N/A|
(Bloomberg Opinion) -- The IPO market just got a shot of caffeine from JDE Peet’s BV. Don’t expect other consumer listings to get such a rush.The owner of Peet’s Coffee, Douwe Egberts, Kenco and Tassimo on Friday priced shares in its initial public offering at 31.50 euros, in the upper half of the offering range, valuing the company at 15.6 billion euros ($17.3 billion), and rose to about 35.50 in mid-morning trading.The biggest European IPO this year, pulled off in a swift 10 days, is a remarkable feat for a consumer business in the midst of a pandemic and a looming global recession. But JDE Peet’s has been uncannily well-placed to capitalize on changing consumer habits during lockdown, the prospects for reopening and a resurgence in equity markets. The Dutch company was floated by JAB Holding Co., the investment fund backed by Germany’s billionaire Reimann family. Cornerstone investors, including funds run by George Soros’s firm, had agreed to take up a third of the offering, setting the tone.In a world crowded with coffee chains, JDE Peet’s gets 80% of its sales from coffee that is drunk at home. That meant it benefited as corner cafes shuttered and people working from home were forced to become their own baristas. Now that they can start going out again, it’s ready to serve them their favorite hot beverage too at the Peet’s Coffee chain. And just as Nestle SA benefited from people looking to stock up on the Starbucks-branded coffee it sells in supermarkets, so JDE Peet’s may gain new customers at its cafes if they discovered its products in the grocery store during lockdown. As consumers navigate post-lockdown life, JDE Peet’s looks well insulated. That may explain why the valuation, as of mid-morning trading, is approaching that of Starbucks Corp. on a calendar 2019 enterprise-value-to-Ebitda basis. With consumers likely pulling in their purse strings, homemade coffee may be more popular than pricey takeaway lattes. Yet the valuation may also reflect optimism about reopening, and expectations that people will be eager to get out and about. Early indications from U.S. retailers, such as discount-chain owner TJX Cos Inc. and even department store Macy’s Inc., are that sales have been stronger than expected since Americans were able to shop in person once again.And let’s not forget about the IPO timing with stock markets gaining from their lows in March. That may be one reason why Peet’s was so keen on an accelerated book build: to avoid any sudden market turbulence.The fortunate confluence of factors may not come together for other consumer-facing groups looking to float or spin off a division. L Brands Inc.’s desire to eventually separate its Victoria’s Secret lingerie chain comes to mind. It was grappling with a tired image and too many stores even before the Covid-19 outbreak.As for Peet’s, the successful float leaves it with firepower for further acquisitions. It plans to use the proceeds to cut debt — it aims to reduce the leverage ratio from 3.6 times to below 3 times by the end of the first half of 2021 — but it gets an acquisition currency in the form of equity.Competition for coffee assets has been intense. There was a flurry of deals two years ago with JAB’s $2 billion purchase of Pret A Manger, which sells coffee as well as food to go; Coca-Cola Co.’s $5.1 billion swoop on Costa Coffee; and Nestle’s $7 billion deal for the rights to sell Starbucks coffee in supermarkets.But JDE Peet’s could get lucky here, too, particularly in the market for drinking coffee outside the home. With the lockdown-induced distress in malls and on main streets, it may be able to grab something to go for a better price.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.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) -- When private equity firm Sycamore Partners walked away from beleaguered lingerie chain Victoria’s Secret, some of the loudest gasps came from India, Asia’s busiest market for distressed assets.Acquirers felt emboldened to seek legal advice. Could they at least renegotiate prices by arguing that the coronavirus was a material adverse change? Also known as MAC, this is an unforeseen event that durably depresses the value of a target company.Judges usually set the bar high for allowing a deal to be killed because of MAC. In the Victoria’s Secret case, Sycamore argued that the clause had been triggered because current owner L Brands Inc. failed to pay rent and furloughed thousands of workers. The pandemic was “no defense” for L Brands violating terms of the agreement, the buyer said in its complaint in the Delaware Chancery Court.In the U.S., Mirae Asset Global Investment Co. is pleading that Anbang Insurance Group Co. breached the terms of its $5.8 billion hotel chain sale by shuttering properties. That the closures came in response to the outbreak is “irrelevant,” Mirae said in court papers. A unit of Anbang (now known as Dajia Insurance Group) has sued to force the Korean investor to complete the transaction.The MAC risk has come to M&A globally, with 52 publicly filed agreements in the U.S. so far this year excluding pandemics from the definition of material adverse change, the highest in any year, according to Bloomberg Law analyst Grace Maral Burnett. As she explains, a longer list of exclusions typically helps sellers by “limiting the situations in which the acquirer is able to walk away from a deal.”These moves and lawsuits are being watched closely in India. Creditors seeking to recover something from hundreds of billions of dollars of soured corporate loans are nervous. Successful bidders may try to use the pandemic to wriggle out of commitments — or stall payments. Buyers are wary of overpaying for assets whose future earnings potential may have been permanently damaged by Covid-19 and the ensuing lockdowns.For buyout firms, the clock is ticking. They have raised money globally to pick up an interest in the debt of stressed Indian businesses. India’s 2016 bankruptcy law brought them to the country. Long delays in concluding large transactions, like the $5.9 billion sale of Essar Steel India Ltd. to ArcelorMittal, weren’t unexpected, but they did eat into the typical seven-year life of a fund.If wranglings around MAC drag on in tribunals and courts, India’s appeal may fade amid an oversupply of distressed assets everywhere. More than $38 billion in defaulted Indian loans are awaiting resolution, according to an analysis of 245 cases by restructuring services firm Alvarez & Marsal.A yearlong suspension of new bankruptcy filings ranks among the relief measures recently announced by the government of Prime Minister Narendra Modi. The logic is easy to see. Even before the pandemic, only one or two bidders were showing up in small in-court bankruptcies. With the economy in a tailspin — Goldman Sachs Group Inc. forecasts it will shrink an annualized 45% this quarter — the ratio of four liquidations to one corporate rebirth will balloon. A quarter of the workforce is without jobs. A further spike in unemployment could ignite social strife. Yet by acknowledging that the pandemic merits special treatment in bankruptcy, India may have unwittingly shown buyers a way out.So far, there’s only one reported case of an Indian company citing the lockdown to renegotiate a bid, involving the sale of a small auto-parts maker. Large acquirers are hesitant. No one wants to be first to tell creditors they want to pay less: Lenders would seek to get the errant buyer barred from future auctions. The government might not take kindly to such moves, either. State-owned banks are carrying the can of dud loans; the less the buyers put up, the higher the taxpayers’ burden. However, if there’s a barrage of bankruptcy litigation — for instance, around the Covid-19 related debt the government says will be excluded from the definition of default — then those seeking to use MAC to renegotiate or stall may quietly join the slugfest. In light of the pandemic’s extreme impact, “there may be circumstances” in which a court might find a material adverse change occurred when it wouldn’t have under more normal conditions, M&A counsel Gail Weinstein of Fried, Frank, Harris, Shriver & Jacobson LLP and others wrote in a Harvard Law School article last month.Buyers in India’s distressed market are hoping for just this outcome. Lawyers are tingling with anticipation. Banks are dreading it. And investors who bought defaulted debt are praying that any fresh proceedings will be conducted swiftly, on merit, and won’t end up derailing the bankruptcy gravy train. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.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.
Maryjo Cohen has been the CEO of National Presto Industries, Inc. (NYSE:NPK) since 1994. This analysis aims first to...
Today we'll evaluate National Presto Industries, Inc. (NYSE:NPK) to determine whether it could have potential as an...
(Bloomberg) -- Sign up to our Next Africa newsletter and follow Bloomberg Africa on TwitterEskom Holdings SOC Ltd.’s new boss has taken a first step to reduce the indebted South African power utility’s bloated wage bill while avoiding a potential clash with labor unions.Chief Executive Officer Andre de Ruyter, who took office at the start of the year, intends trimming Eskom management by offering voluntary severance packages to personnel aged 60 to 62. The utility set aside 400 million rand ($27 million) for the plan, an allocation it expects to recoup through savings within a year.Asking staff to leave of their own accord is a relatively easy measure that can be utilized to start trimming staff numbers, according to Andrew Levy, managing partner at Andrew Levy Employment, which advises companies on labor relations.“It is really top heavy,” he said. “The voluntary package is a portent of things to come.”Eskom has amassed 454 billion rand ($30.5 billion) in debt, and isn’t generating enough income to cover its operating costs. While its headcount fell about 4% to 46,665 in its last financial year, it still has about a third more staff than it says it needs and wider job cuts have been resisted by labor unions.De Ruyter embarked on extensive cost cutting during his previous tenure as CEO of packaging company Nampak Ltd,. disposing of loss-making units and reducing staff numbers to shore up the company’s balance sheet. While he’s ruled out firing Eskom workers, the utility does need to further reduce a workforce that’s expanded more than 23% in the past decade even as electricity sales volumes declined.“Eskom cannot survive without massive staff cutbacks,” Levy said.So-called lifestyle audits already under way at the utility -- to weed out corruption and curb reckless spending -- will be extended to lower-level staff, News24 reported on Sunday, citing De Ruyter. Audits of senior managers and their families that began two year ago resulted in a number of disciplinary actions, with some cases referred to the police’s Special Investigating Unit, it said.Applications for the voluntary packages will start in the third week of February, with exits planned by the end of April, and no critical skills will be lost in the process, according to Eskom. The voluntary severance won’t be offered to staff who don’t hold management posts.The National Union of Mineworkers and the National Union of Metalworkers of South Africa, the two largest unions at Eskom, didn’t immediately respond to requests for comment.(Updates with plans for lifestyle audits in third-last paragraph.)To contact the reporter on this story: Paul Burkhardt in Johannesburg at email@example.comTo contact the editors responsible for this story: James Herron at firstname.lastname@example.org, Mike Cohen, Pauline BaxFor 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.
Today we'll take a closer look at National Presto Industries, Inc. (NYSE:NPK) from a dividend investor's perspective...
Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is...
National Presto Industries, Inc. (NYSE:NPK) is a company with exceptional fundamental characteristics. Upon building...
This article is written for those who want to get better at using price to earnings ratios (P/E ratios). To keep it...