129.50 +0.07 (0.05%)
Before hours: 9:18AM EDT
|Bid||129.40 x 800|
|Ask||129.51 x 1100|
|Day's range||127.62 - 130.09|
|52-week range||102.00 - 134.13|
|Beta (5Y monthly)||0.30|
|PE ratio (TTM)||24.61|
|Earnings date||18 Aug 2020|
|Forward dividend & yield||2.16 (1.67%)|
|Ex-dividend date||13 Aug 2020|
|1y target est||137.58|
Verizon and two other resilient blue chip stocks will generate stable returns throughout the next recession.
Johnson & Johnson (NYSE: JNJ) is a top healthcare company known by consumers all around the world for its various products and drugs. Versatility is important during these difficult times, and with three strong business segments -- consumer health, pharmaceuticals, and medical devices -- Johnson & Johnson is a more stable long-term investment thanks to its diversification. Johnson & Johnson has begun human trials, and if the vaccine proves to be effective, the company could have as many as 900 million doses of it available by April 2021.
(Bloomberg Opinion) -- Robert P. Jones is founder and CEO of the Public Religion Research Institute and author of the new book, “White Too Long: The Legacy of White Supremacy in American Christianity.” Jones, who was raised a Southern Baptist in Mississippi, has a divinity degree from Southwestern Baptist Theological Seminary and a doctorate in religion from Emory University. His book is a powerfully detailed history, not a polemic. I interviewed him, via email, last week. A lightly edited transcript follows.Wilkinson: “Racism” is a popular subject right now. You use a term — in the book’s title and throughout the text — that has sharper edges and fewer ambiguities: “white supremacy.” That’s a phrase Americans typically associate with the Ku Klux Klan or other fringe groups. Yet how “fringe” is white supremacy to American culture?Jones: Properly understood, white supremacy is not fringe at all but actually has framed the entire American story. For most white Americans, the term primarily evokes white sheets and burning crosses — extremist images, mostly from a bygone era. But white supremacy is not just, or even fundamentally, about individual acts of racial terrorism. Its more powerful expressions are built, over generations, into the way society is organized: which neighborhoods were open, which jobs were available, what political power was allowed, and what laws were applied to whom.If we reexamine the plain meaning of the phrase, its continued relevance comes into view. Even rearranging the words — from “white supremacy” to “supremacy of whites” — gets us to a clearer meaning: the belief that white people’s superior nature and divinely favored status entitles them to hold positions of power over Black and other nonwhite people.A dizzying array of resources across multiple fields of human inquiry has been deployed to defend this belief. By far, the strongest were theological arguments that presented white supremacy as divine mandate. Particular readings of the Bible provided the scaffolding for these arguments. Black Americans, for example, were cast as descendants of Cain, whom the book of Genesis describes as physically marked by God after killing his brother, Abel, and then lying to God about the crime. In the white Christian version of this narrative, the original ancestor was a Black criminal, and modern-day dark-skinned people continue to bear the physical mark of this ancient transgression. This story implied that Blacks likely inherited both their purported ancestor’s physical distinctiveness and his inferior moral character. These teachings persisted in many white Christian circles well into the 20th century.Wilkinson: White supremacy is pervasive in U.S. history, politics and culture. Why did you focus on its dominion in American Christianity?Jones: Even amid our current moment of reckoning and enlivened consciences around issues of racial justice, the role that white Christianity has played in granting moral legitimacy to white supremacy has largely escaped scrutiny. Much of the recorded history of slavery, segregation, and racism gives scant treatment to the integral, active role that white Christian leaders, institutions, and laypeople played in constructing, maintaining and protecting white supremacy in their communities. Even historians critical of racism and segregation often depicted white Christians as being merely complacent. They were guilty of committing sins of omission by ignoring the post-Civil War turmoil of Reconstruction, Redemption, Jim Crow and the civil rights struggles of the 1950s and beyond. Even those who went further accused white churches only of complicity, of being unwitting captives of the prevailing segregationist culture.Both treatments are essentially protectionist, depicting the struggle over Black equality as external to churches and Christian theology. But many white church members and leaders aggressively defended segregation both inside and outside of their sanctuaries.At a pragmatic level, white churches served as connective tissue that brought together leaders from other social realms to coordinate a campaign of massive resistance to Black demands for equality. At a deeper level, white churches were the institutions of ultimate legitimization, where white supremacy was divinely justified via a carefully cultivated Christian theology. White Christian churches composed the cultural score that made white supremacy sing.Wilkinson: One thing I learned from your book is how deeply the “Confederate Trinity” of Jefferson Davis, Stonewall Jackson and Robert E. Lee pervaded white Christianity. How did the Lost Cause become an explicitly white Christian cause?Jones: The Confederacy was, from the beginning, a cause tied up with white Christianity, which conferred on it divine blessing and moral legitimacy. For example, Rev. Basil Manly Sr., a prominent Baptist leader, served as chaplain to the Alabama secessionist convention and offered the public prayer at Jefferson Davis’ inauguration as president of the Confederacy. Standing next to Davis, Manly implored God to “let thy special blessing rest on the engagements and issues of this day.” He asked for special blessings on the Congress of the Confederate States and especially on Davis as a divine servant whose acts might be “done in thy fear, under thy guidance, with a single eye to thy glory; and crown them all with thy approbation and blessing.” After the Civil War, Manly and others shifted tactics to promote a “Lost Cause” theology, which held that, despite military defeat, the divine vision of a white supremacist society would be restored. Over time, Davis, Jackson and Lee evolved into Confederate Christian saints who were treated as religious icons. In addition to creating public monuments glorifying them, groups such as the United Daughters of the Confederacy, and many upper-class southern whites, incorporated images of this Confederate trinity into sacred spaces, principally through stained glass installations in churches and other public buildings. (Until 2017, there were stained-glass panels depicting Jackson and Lee in Washington’s National Cathedral. The Cathedral removed two images of Confederate battle flags only the year before.) Lee was described as a gentle and virtuous Christian knight, often depicted as Moses leading his people to the promised land, or as a Christ figure. The significance would not be lost on church congregations. Moses never made it to the promised land and Jesus was crucified; but Moses pointed the way to the Jewish people’s ultimate arrival in the promised land, and Jesus rose from the dead. Davis functioned as a Christian martyr, whose treatment, especially his imprisonment, after the war symbolized the South’s broader mistreatment and humiliation. Stonewall Jackson represented a stern Old Testament prophet-warrior. In the face of an emasculating defeat, Jackson’s image evoked courage, valor and an unflinching sense of the righteousness of the cause. These images were installed in numerous churches and depicted on massive monuments like the frieze carved into Georgia’s Stone Mountain, which is larger than Mount Rushmore.Through the medium of sacred art, displaying their images alongside — or even as — Jesus, the New Testament apostles, and the Old Testament biblical patriarchs, Lost Cause supporters elevated Davis, Jackson and Lee above history into Christian sainthood. At the same time, they cast the white South as God’s chosen people.Wilkinson: Yet your book shows that white supremacy is not exclusive to the South or to white Protestants. Jones: That’s correct, and this insight is critical for understanding our current situation. In addition to the historical material in the book and my own personal story as a white Christian who grew up as a Southern Baptist in Mississippi, the book draws on a range of contemporary public opinion data. In question after question, survey after survey, white Christians of all kinds — not just evangelicals in the South but also mainline Protestants in the Midwest and Catholics in the Northeast — are significantly more likely than religiously unaffiliated whites to hold racist attitudes. For example, white Christians are nearly twice as likely as religiously unaffiliated whites to say killings of unarmed black men by police are isolated incidents rather than part of a pattern of how police treat African Americans. And white Christians are at least 30 percentage points more likely than religiously unaffiliated whites to say the Confederate flag is more a symbol of southern pride than a symbol of racism. Overall, even when controlling for a range of demographic characteristics, public opinion data reveal a positive, independent relationship between holding racist attitudes and white Christian identity. Looked at from the other direction, being affiliated with a white Christian group — whether evangelical Protestant, mainline Protestant, or Catholic — is independently associated with an approximately 10% increase in racist attitudes. By contrast, there is no significant relationship between white religiously unaffiliated identity and holding racist attitudes. Wilkinson: As you said, this story is personal for you, as well. You were raised a devout Southern Baptist and attended seminary. Our politics suggest that millions of white Christians are a long way from making the kind of intellectual and moral journey you made to write this book. At the same time, we see widespread protest while Confederate iconography is being discarded everywhere. Something is stirring. Is white supremacy’s long reign threatened?Jones: The conscience of the country is stirring. When I walked the 14 blocks of Richmond’s Monument Avenue last July while conducting research for the book, I passed no fewer than five massive monuments to Confederate leaders. Erected between 1890 and 1919, they were placed within large traffic circles that periodically slow and bend the flow of traffic around these saints of southern secession.Remarkably, after standing for more than a century, the bronze statues at the center of four of the five monuments were taken down over the course of four weeks. The fifth and earliest monument, dedicated to Robert E. Lee, is slated for removal. In my home state of Mississippi, the Mississippi Baptist Convention (the state organization connected with the Southern Baptist Convention) proactively called on the governor and the state legislature to remove the Confederate battle flag from the state banner. NASCAR, Walmart, and SEC football have banned the display of the Confederate flag on their properties and at events. I did not imagine that such events would occur between last fall when I completed the book manuscript and last week when it was published. So I’m hopeful that the current context will provide an opportunity for soul-searching among white Christians. But to be authentic, we’ll need to move beyond the removal of monuments to white supremacy to dismantling the theology and the worldview that supported their installation in the first place.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Francis Wilkinson writes editorials on politics and U.S. domestic policy for Bloomberg Opinion. He was executive editor of the Week. He was previously a writer for Rolling Stone, a communications consultant and a political media strategist.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) -- The pandemic has given rise to some big changes in consumer behavior. We’re all familiar with the obvious ones by now, including more meals at home, fewer trips on airplanes and a dearth of reasons to buy high heels or suits. But after a batch of big-name consumer companies reported earnings in recent days, it’s become clear those changes were just the beginning.The Covid-19 situation has created a spider web of indirect, secondary shifts in shopping habits and consumer appetites that are just as consequential for brands and retailers as the bigger, broader trends. How companies respond will serve as a key test of their adaptability and creativity. Here are just a few examples: A Skincare Star Fades: In recent years, the upscale SK-II beauty brand has been a bright spot in Procter & Gamble Co.’s portfolio. The skincare line, which counts $299 “facial treatment essence” and $325 serum among its offerings, has regularly been called out as a catalyst of sales growth in the company’s beauty division. But in the quarterly results reported Thursday, SK-II turned out to be a blemish, with the company saying sales declined “double digits” in the brand. Why? Blame it on empty airports. Executives said travel disruptions exacted a major toll, meaning that the closure of duty-free shops – or the lack of foot traffic to them – caused sales to evaporate. International travel patterns aren’t likely to return to any semblance of normal any time soon, so P&G must figure out how it can work with retail partners such as Sephora, Bluemercury, and to a lesser extent, department stores, to plug the gap.Gum Gets Bitten: Packaged-food giant Mondelez International Inc. said Tuesday that sales at its gum and candy division plunged 33% in the quarter from a year earlier, a decline it said was mostly attributable to chewing gum. It’s not that customers suddenly had an aversion for its Trident or Stride brands. It’s that gum consumption is very dependent on people being away from their homes. It’s chewed on the go to have fresh breath for meetings or first dates – activities that are largely on pause right now. It doesn’t help that gum is often a convenience-store or drugstore impulse buy, seeing as those kinds of shopping trips are being foregone with more people embracing online shopping for groceries and household essentials. This suggests that Mondelez would be wise for now not to waste advertising dollars or promotional spending on gum, and instead funnel it toward brands such as Oreo and Ritz that have a better chance of making people’s shopping lists. If You’re Going Out, Get Me One, Too: Starbucks Corp. reported earnings Tuesday, and as you might expect — given that many of its U.S. cafes were closed for much of the June quarter — U.S. traffic slumped from a year earlier by a whopping 52%. At the same time, though, average ticket, or the average total bill, rocketed 25% from a year earlier. This isn’t because some strange subset of people was suddenly mainlining caffeine; it’s because customers were placing far more group orders. Think about it: If you visited Starbucks in pre-pandemic times, it was probably to grab a single drink to slurp at your cubicle. Now, with the whole family stuck at home, a trip to Starbucks might include a latte and breakfast sandwich for your spouse and a donut for each of your kids. This bundling of orders is not necessarily a bad thing for restaurants. In fact, it makes the economics of delivery orders more attractive and could help keep drive-through lines from getting off-puttingly long. But it does require careful thinking about how to allocate labor and tailor operations to make sure big-batch orders are given to customers fresh and hot. Scrapping for Beer Cans: The widespread closure of bars across the U.S. and Europe in the spring hurt quarterly revenue for Molson Coors Beverage Co. to the tune of a 14.3% drop from a year earlier (adjusting for currency fluctuations). But its so-called off-premise business suffered in the U.S., too. CEO Gavin Hattersley said on a Thursday earnings call that while demand for party-friendly kegs all but vanished in this market, demand for 12-ounce cans “went through the roof.” That became an issue when the company struggled to get enough aluminum cans to keep up with this new consumer preference, and sales suffered as a result. The company is already doing the smartest thing it can to adapt, which is work with suppliers to ensure availability of the packaging materials needed to accommodate the stay-at-home lifestyle. We’re Staying Home This Year, Kids : U.S. tourism has suffered tremendously from the Covid-19 outbreak, creating headwinds for airlines, hotels, theme parks, restaurants, and even retailers such as Macy’s Inc. and Tiffany & Co., whose Manhattan flagships are magnets for out-of-towners. But the effects from this drop-off ripple even further. Executives of Carter’s Inc., the baby and kids’ clothing chain, said on a July 24 earnings call that sales at their stores in tourist-centric locations were down 20% from a year earlier upon reopening, while at non-tourist-centric locations, they were up 15%. Given that tourist-centric stores accounted for about 10% of its locations but 20% of its store sales last year, this represents a real obstacle for the apparel giant. Carter’s has no power to change global tourism trends, but it can try to offset those challenges in other ways, such as trumpeting its new curbside pickup offering and leaning more on its wholesale relationships with the likes of Walmart Inc., Target Corp. and Amazon.com Inc. – retailers that have remained extremely busy during the pandemic.These wide-ranging and somewhat idiosyncratic business situations illustrate how the pandemic is truly leaving no corner of the economy and our daily routines unchanged, right down to gum-chewing. And the situation is still playing out. More than ever, companies need to be tuned in enough to the latest trends to spot shifts as they are happening, and flexible enough to make quick adjustments. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Sarah Halzack is a Bloomberg Opinion columnist covering the consumer and retail industries. She was previously a national retail reporter for the Washington Post.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.
Another brand of plant-based burgers is coming to the shelves of Walmart (NYSE: WMT) on a large scale, according to a press release from Impossible Foods, a leading maker of meat substitutes in the USA and elsewhere. Packages of Impossible Burger, which the company describes as its "flagship product," will soon be on offer in the retail giant's meat section, and will also be available for delivery or for pickup at Walmart store locations. Impossible Foods notes stocking of its 12-ounce Impossible Burger packages in over 2,000 Walmart stores and supercenters will boost the number of physical locations selling its products in America to more than 8,000 in total.
Impossible Foods said today that it will now be available in Walmart, the largest meat market in America. The deal with Walmart and other retail locations across the country increases the company's physical footprint 50x. Impossible Foods will now be available at more than 2,000 Walmart Supercenters and Neighborhood Markets across the country, and the company will be selling its frankenmeats on the company's websites and mobile apps.
(Bloomberg) -- Walmart Inc. might be one of the few big winners in the pandemic, having posted surging sales month after month, but that isn’t stopping the company from tightening its belt.The world’s biggest retailer has laid off hundreds of workers in units including store planning, logistics, merchandising and real estate, according to people familiar with the matter. It is also reorganizing its roughly 4,750 U.S. stores by consolidating divisions and eliminating some regional manager roles, two of the people said.Some of those affected were told in-person, while others learned over a Zoom call, said the people, who asked not to be identified because they aren’t authorized to speak publicly. Conversations with those impacted will continue throughout the week. Those who lose their jobs will be paid until the end of January, when Walmart’s fiscal year ends and annual bonuses get doled out, according to one of the people.The company declined to comment specifically on the plans, saying via email that it would “share additional information after we’ve completed our communication with associates.” John Furner, head of Walmart’s U.S. operations, is expected to address the restructuring in a statement to employees Thursday afternoon.‘Additional Changes’“We are continuing on our journey to create an omni-channel organization within our Walmart U.S. business and we’re making some additional changes this week,” Walmart said in the email, without clarifying. The company said its goal is to increase “innovation, speed and productivity.”Walmart is performing well thanks to soaring demand and its low prices during the pandemic. The move is an acknowledgment that the retailer is simply not opening many new stores in the U.S. anymore, so it doesn’t need as many people to find new locations and design them.It’s also part of a multi-year streamlining effort that has sought to consolidate its brick-and-mortar and online divisions, bringing cohesion to what had been disparate -- and sometimes conflicting -- functions. The changes to store operations follow a similar move in 2017 that reduced the number of U.S. divisions from six to four. Walmart has re-named its store divisions “business units,” and will now have three for its massive Supercenters and one for its smaller Neighborhood Markets, which are the size of traditional grocery stores. It has also added some new roles in certain markets, Walmart said.The changes signal that Furner, who took over the U.S. business in November, wants to put his own stamp on the company’s most important unit, which generates two-thirds of its sales and delivers better profit margins than the rest of the company.Walmart fell less than 1% to $129.89 at 12:25 p.m. in New York. The stock had climbed 10% this year through Wednesday, beating the S&P 500 but trailing peers like Costco Wholesale Corp. and Dollar General Corp.The retailer’s merchandising division, whose buyers choose what products to carry and how to price them, has also been hit with job reductions as store and dot-com positions get merged, two of the people said.Other JobsSome of those impacted might find other jobs inside Walmart, according to one of the people. Often, those leaving Walmart get jobs with one of the retailer’s vendors who maintain offices near Walmart’s headquarters in Bentonville, Arkansas. But those openings have dried up somewhat, according to Cameron Smith, an executive recruiter in nearby Rogers, Arkansas. Normally, Smith’s firm has as many as 80 open jobs in the region, but today it has just 54, he said.Layoffs are also happening in departments such as transportation, human resources and product design, one of the people said. Online message boards and private Facebook groups popular with Walmart associates lit up with the news. “20 years, good performance...but given the big boot today,” said one anonymous poster. “Just laid off, 26 years with Walmart,” said another.Many retailers have been trimming back-office workforces during the pandemic. L Brands Inc., the owner of Victoria’s Secret and Bath & Body Works, said this week it will eliminate 850 office jobs, or about 15% of its corporate staff. Last month, Macy’s Inc. said it was eliminating 3,900 corporate and management jobs. Tailored Brands and Levi Strauss & Co. are cutting corporate positions, too.But they’re all reeling during the pandemic, while Walmart -- America’s go-to for groceries and other essentials -- has seen sales surge. In May, Walmart reported coronavirus-related stockpiling led to a boost in quarterly sales, underscoring the company’s strong position amid widespread carnage in the U.S. retail sector. It next reports earnings on Aug. 18.(Updates with details on U.S. divisional restructuring in second paragraph)For 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.
Walmart (NYSE: WMT) continues to streamline its operations as it moves to merge its online business with its U.S. stores. Without a growing physical presence, jobs involved in such operations are superfluous, though those who lost jobs will continue to be paid until January, which coincides with Walmart's fiscal year. Walmart spokeswoman Jami Lamontagne confirmed the dismissals to CNBC, saying, "We are continuing on our journey to create an omnichannel organization within our Walmart U.S. business, and we're making some additional changes this week."
(Bloomberg) -- Walmart Inc. will sell Impossible Foods Inc.’s plant-based burger in over 2,000 stores across the U.S., the maker of meat substitute products announced Thursday.The expansion into the world’s largest retailer, which begins today at more than a third of Walmart’s total U.S. locations, brings the availability of Impossible Foods products to over 8,000 brick-and-mortar stores across the U.S.Impossible Foods has rapidly expanded its distribution in a short period of time as the company leaves behind last year’s supply hiccups and consumers increasingly warm to the idea of meat-like products made from plants. Impossible Foods is capitalizing as quarantined consumers cook more at home and eat less animal meat.Walmart will stock the patties in its meat aisle, a move that’s been shown to bolster sales of plant-based meat by 23% compared to offering it in the refrigerated section.Conversations with Walmart have been occurring for at least three years, Impossible Foods Chief Financial Officer David Lee said in an interview.“It’s an important milestone, because we are ready now to serve the masses at scale,” Lee said.Impossible competitor Beyond Meat Inc. has also reported accelerated growth in recent years, although Covid-19’s disruption of the restaurant industry has upended one of the companies’ fast-growing sales channels. Beyond Meat will report second-quarter earnings on Aug. 4.For 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.
Yahoo Finance checks in with P&G CFO Jon Moeller moments after thee company's second quarter earnings.
The list of retailers saying they will close this Thanksgiving is piling up.
Walmart is expanding its use of voice technology. The company announced today its taking its employee assistance voice technology dubbed "Ask Sam" and making it available to associates at over 5,000 Walmart stores nationwide. The tool allows Walmart employees to look up prices, access store maps, find products, view sales information, check email and more.
(Bloomberg) -- When Jamie Iannone last worked at EBay Inc. in 2009, its then-smaller rival Amazon.com Inc. was struggling to survive the Great Recession.Now Iannone has returned as chief executive officer, and EBay is the one trying to emerge from Amazon’s lengthening shadow.EBay is seen as such an also-ran by activist investors that they believe the company is more valuable sold off in pieces. Walmart Inc., a latecomer to e-commerce, is expected to supplant EBay as America’s No. 2 online marketplace this year. As if that were not enough, members of EBay’s security team were indicted earlier this year for an alleged cyberstalking scandal -- casting another pall over the San Jose, California-based company.Iannone, 48, professes little concern, arguing that a sales surge from shoppers afraid to visit stores during the Covid-19 outbreak could provide the kind of lasting momentum that has long eluded EBay. The rush online certainly buyoed the company’s second-quarter sales and earnings, which beat analysts’ expectations. But after digesting the results, investors balked -- the shares were down about 2% on Wednesday morning -- because they fear U.S. consumers will revert to their usual shopping habits once the pandemic eases.Read more: EBay Boosts Outlook on Pandemic; Investors Ask If It Will LastIt’s up to Iannone to prove them wrong by making sure the 8 million new shoppers and tens of thousands of new sellers attracted in the second quarter stick around. He’s hopeful given the speed with which merchants reacted to the outbreak, offering masks and hand sanitizer at first and then helping shoppers find laptops, office furniture and fitness equipment as offices and gyms closed.“I’ve really been impressed with our sellers and how they’ve stepped up to help buyers in need,” Iannone said in an interview.Iannone left EBay in 2009 for stints with Barnes & Noble Inc. and Walmart, where he ran Sam’s Club before becoming chief operating officer of Walmart’s e-commerce division. He’s no stranger to competing with Amazon.At first glance, his plan for EBay sounds similar to that of predecessor Devin Wenig, who resigned in September after clashing with activists looking to streamline the company. Iannone wants to use technology to improve the shopping experience and restore EBay to its former glory. He’s spending on marketing to attract new shoppers, especially younger ones.In particular, he thinks the company has neglected the $500 billion market for used items such as collectible sneakers, apparel and furniture, relinquishing too much business to Facebook Inc.’s marketplace and such startups as OfferUp. EBay‘s efforts to streamline payments so buyers and sellers can meet locally to exchange goods without cash show promise, Iannone said.The similarities between his and Wenig’s visions could be one reason the stock pulled back on Tuesday, but investors should give the new CEO time to differentiate, said DA Davidson & Co analyst Tom Forte.“It’s too early to judge the Jamie Iannone tenure on his first earnings call,” Forte said. “He’s still getting his feet wet, and we have to be patient and let him clarify his vision.”A first step that impressed some EBay investors was the sale of the classifieds business to Norwegian digital marketplace Adevinta in a cash and stock deal valued at $9.2 billion. EBay got $2.5 billion in cash from the deal to help appease activist investors and also secured a 44% stake in the new entity, which is the largest online classifieds business in the world with leading positions in 20 countries.While the classifieds unit suffered when thousands of car dealership closed during the pandemic, EBay’s ownership stake means it will benefit from a rebound without having to manage the business. Iannone declined to comment on the sale, but he steered the deal through a series of last-minute meetings to secure the favorable arrangement with Adevinta, which even impressed some competing bidders who lost, according to three people familiar with the matter.Bill Smead, whose Smead Capital Management has owned EBay stock for 12 years, said he’s satisfied with the company’s performance. Its growth is slow and steady, and the core business survives even after selling off valuable pieces including PayPal, StubHub and classifieds. Analysts are mistaken to compare EBay’s growth rate to Amazon without considering profitability, he said.“We’ve owned this stock for 12 years and have made about 20 times our money,” Smead said. “There’s nothing wrong with this business.”For 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) -- Shopify Inc. nearly doubled its revenue in the second quarter, crushing analysts’ estimates as a flood of merchants moved their businesses online during the coronavirus pandemic.Sales grew 97% to $714.3 million from the same quarter a year ago, Ottawa-based Shopify said in a statement Wednesday. Analysts had expected about $512 million, according to data compiled by Bloomberg.Gross merchandise volume, a key metric that represents the value of all goods sold through Shopify’s platform, surged 119% from a year earlier or to $30.1 billion. Analysts were expecting a 49% increase to $20.6 billion. Sales of food, beverages and tobacco doubled over the first quarter, the company said.“The strength of Shopify’s value proposition was on full display in our second quarter,” Chief Financial Officer Amy Shapero said in the quarterly release. “We are committed to transferring the benefits of scale to our merchants, helping them sell more and sell more efficiently, which is especially critical in this rapidly changing environment.”E-commerce companies have been big winners of late, with the coronavirus closing many physical retail stores. Many analysts predict this boost will be lasting. Shopify shares jumped as much as 12.5% in early New York trading, touching a fresh high, and are up 169% this year. New stores created on the Shopify platform grew 71% in the second quarter compared with the first quarter, driven in part by the company’s decision to extend the free-trial period on standard plans from 14 days to 90 days.Large sellers continued to migrate to Shopify Plus, resulting in a record quarter for new merchant additions to the platform.“Strong transactional revenue, far ahead of even the highest expectations, point to Covid-19 tailwinds that are stronger at SHOP than most anticipated,” said Citigroup analyst Walter Pritchard. “Key from here will be sustainability of demand from newly acquired merchants,” he said in a report.Read more: Shopify Is Enjoying a Big Moment and Hoping It Will LastStill, the company chose not to provide forecasts for the third quarter, citing uncertainty surrounding Covid-19. It said it’s monitoring the impact of rising unemployment on new store creation, consumer spending habits and the rate at which brick-and-mortar merchants move online. The tech company suspended its forecast full-year forecast in April.This year, Shopify has formed partnerships with Walmart Inc. to expand its third-party marketplace site and with Affirm Inc. to allow consumers to break purchases into a series of smaller payments -- moves aimed at stepping up competition with Amazon.com Inc.Work From HomeThe company said in May that it will keep its offices largely closed for the rest of the year as it designs its space for a “digital by default” mindset, adjusting to a remote work environment.“This also represents an opportunity for Shopify to open up, further diversify our talent pool, unconstrained by physical location,” Shapero said on the earnings call today. The company took a $31.6 million impairment charge as it exited some of its secondary offices in major cities, she said. Second-quarter results includes $37.1 million of incremental expenses related to changes in its facilities, she added.‘Right Time’After its shares more than quadrupled in 2019, Shopify blew past Royal Bank of Canada this year to become the most valuable company in Canada’s S&P/TSX Composite Index. It’s the best-performing company in the index this year.“It remains clear that Shopify is at the right place and the right time with the leading e-commerce software and services platform enabling the ‘digital transformation” for thousands of businesses,” said Baird analyst Colin Sebastian.(Updates with share price move, analyst comments and work from home details.)For 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.
Neiman Marcus, J.C. Penney, GNC, True Religion, and J. Crew are just some of the names forced into bankruptcy since March, when the impact of COVID-19-related closures became overwhelming. No surprises here: Walmart (NYSE: WMT) has become something of a lifeline since COVID-19 took hold. Not only does it sell groceries and cleaning supplies that consumers desperately need, but it can bring those items to customers' cars with curbside pickup.
(Bloomberg) -- Leaders in India’s technology industry are urging the country to go even further to protect the interests of local companies against foreign rivals, or risk ceding the world’s fastest growing internet arena to Chinese and American monopolies.Narendra Modi’s administration this month banned 59 Chinese apps in the country, including ByteDance Ltd.’s short-video hit TikTok, a dramatic policy shift aimed at improving local control and data security. In separate interviews, Policybazaar co-founder Yashish Dahiya -- whose company is backed by Tencent Holdings Ltd. -- and MobiKwik frontman Bipin Preet Singh urged Modi to go further. Emboldened by growing hostility against its giant neighbor, they want regulators to curb their access to Indian markets, establish rules to wrest back control of user data and bankroll local startups.“China has long been the bratty kid who thinks it’s OK to grab others’ cake without sharing your own,” Dahiya told Bloomberg News last week. India must strategically reduce market access before its neighbor becomes even more powerful. “If India doesn’t do it now, it can never be done,” said Dahiya, whose online insurance service targets a 2021 IPO at a $3.5 billion value.Dahiya and Singh are breaking with tradition in an Indian startup sector that over the past half-decade has attracted billions from Chinese companies and investment houses from Alibaba Group Holding Ltd. to Hillhouse Capital. Their stance reflects a shift in sentiment after a mid-June Himalayan border clash left 20 soldiers dead -- but also a wave of techno-nationalism as the coronavirus pummels global economies. It coincides with a surge of interest from American giants like Facebook Inc. and Google as India’s nascent digital economy blossoms.“It’s not an easy position to take,” said Dahiya, whose Policybazaar is now trying to raise $250 million of pre-IPO financing. “A sovereign nation has no parent but someone’s got to stop China from misbehaving.”On Tuesday, an official with China’s Indian embassy said Beijing will take “necessary measures” to protect the country’s companies from a ban that threatens their legitimate rights, and urged Modi’s government to reverse “wrongdoings.”Before TikTok overtook YouTube to become India’s most popular social video platform, the dominance of WhatsApp and Amazon.com Inc. and Walmart Inc. in e-commerce had already rankled local businesses. Beijing is now the bigger target, as the world polarizes along U.S.-China lines and American-backed local champions such as Mukesh Ambani’s Jio Platforms emerge. The influx of American investment sets up a potential clash with China’s own internet titans in the future -- provided they’re allowed to operate in the country.That, along with trade barriers erected in just past weeks, may have fired up the entrepreneurs. The government should identify strategic sectors and nurture local startups, MobiKwik’s Singh advocated.“The China versus U.S. battleground is neither China nor the U.S., but India,” said Singh, whose Sequoia Capital-backed payments startup competes with both Google Pay and Alibaba-backed Paytm.“If India’s entire 1.3 billion population is served only by foreign companies, how can that be a good thing?” he said in a telephone interview from his base in New Delhi. “Yet India doesn’t have a single technology giant, it’s become a growth engine for global companies. What is India doing wrong?”Read more: India Builds Trade Barriers With China Amid Border RowIndia’s unprecedented apps ban thwarted the global ambitions of China’s technology giants just as the spotlight is turning on the world’s largest untapped digital frontier. ByteDance and other targeted companies have since attempted negotiations with New Delhi, but they’ll have to contend with more than mere legal obligations.India’s roaring digital economy, with half a billion users and growing, is witnessing pitched battles in everything from online retail and content streaming to messaging and digital payments -- but largely between deep-pocketed foreign corporations. That’s coincided with growth tapering off at Infosys Ltd. and Tata Consultancy Services Ltd., which put India’s tech sector on the map but are now grappling with a fundamental shift to the cloud.While India has attracted over $20 billion in just past months from American giants like Google and Facebook, China has over the years carved out a significant role in India’s tech industry, according to Mumbai-based think-tank Gateway House. Eighteen of India’s 30 unicorns are Chinese-funded, researchers Amit Bhandari, Blaise Fernandes and Aashna Agarwal said in a report. Apart from TikTok, smartphone brands like leader Xiaomi Corp. and Oppo have cornered three-quarters of the market. Firms like Qiming Venture Partners nearly doubled Chinese investments in Indian startups to $3.9 billion in 2019, according to the Economic Times.“I’m not advocating a closed or protectionist environment like China’s, but India needs local champions and also needs to safeguard its data and security,” Singh said. “We need competition, we need choices. But we can’t have a situation where there’s no Indian player in entire segments from search to messaging, social media, ecommerce and payments.”Read more: World Economy’s Sputtering Recovery Threatened by Flaring VirusModi’s government has already set things in motion. It drafted an e-commerce policy that openly champions aid for local startups and oversight on how foreign companies handle data. A government panel recommended a data regulator to oversee monetization and privacy of user information to ensure “maximum social and economic benefits” for Indians. Local startups are enjoying something of a renaissance: TikTok-a-like Roposo is signing up half a million new users an hour.But more is needed, Singh said. The system remains stacked against the hundreds of thousands of would-be entrepreneurs who have to take on global behemoths. The government could limit the influence of foreign capital as it has done in sectors like banking, he added.MobiKwik has “raised $100 million so far and is taking on companies with a collective market value of over $2 trillion,” he said. “We are doing injustice to our entrepreneurs if we stack them against dollars and yuans in every single segment.”(Updates with progress of the ban in the 11th paragraph)For 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.
Walmart (NYSE: WMT) seems eager to divest its Asda unit sooner rather than later. According to a report from Bloomberg, citing "people familiar with the matter," the big American retailer has requested that suitors for the U.K. supermarket operator submit their next bids by early September. This would represent a second round of bidding; the initial one took place earlier this year. Three companies solicited bids for Asda.
(Bloomberg) -- EBay Inc. raised its profit and sales forecasts for the year, but the new outlook disappointed investors who hoped the digital marketplace would take greater advantage of the surge in consumer spending during the pandemic. Shares declined as much as 6% in extended trading.The market reaction suggested investors are worried the spending bump on EBay could be fleeting as economies reopen and people return to work. A drop in federal stimulus money, which could trigger a pullback in consumer spending, is another concern, analysts said. Spending among EBay’s U.S. customers grew 35% in the second quarter, while international spending increased 22%.EBay executives said sales increases had moderated in countries such as Italy and Germany where pandemic restrictions are less severe, prompting concerns the company would quickly return to the sluggish revenue growth that has lingered the past several years, said Tom Forte, an analyst at DA Davidson & Co.The pandemic has boosted online shopping platforms such as EBay and Amazon.com Inc. even though double-digit unemployment has hurt the overall economy. In the second quarter, EBay reported gross merchandise volume, the value of all goods sold on its platforms, increased 26% to $27.1 billion from a year earlier. The company said it added 8 million new active buyers to end the quarter with 182 million. Analysts, however, projected almost 184 million.Chief Executive Officer Jamie Iannone said the company stepped up marketing, which helped it attract tens of thousands of new small businesses looking for ways to reach shoppers when their locations shut down. That helped EBay meet demand for items like masks and hand sanitizer initially and later products including laptops, office furniture and fitness equipment as more people worked from home and gyms closed.“Investors have a lot of EBay scar tissue,” Forte said. “Let’s give the new CEO a chance to show he can run with a tailwind and sustain growth.”About 80% of the increased gross merchandise volume was generated by existing customers shopping more frequently and spending more on the site, EBay said. The remaining 20% came from new shoppers.Annual earnings will be $3.47 to $3.59 a share, the San Jose, California-based company said Tuesday in a statement. Analysts, on average, projected $3.50, according to data compiled by Bloomberg.Revenue will be as much as $10.75 billion in 2020, the company said. At the end of April, EBay projected annual sales of as much as $9.76 billion. Analysts estimated $10.4 billion.Chief Executive Officer Jamie Iannone said the company stepped up marketing, which helped it attract tens of thousands of new small businesses looking for ways to reach shoppers when their locations shut down. That helped EBay meet demand for items like masks and hand sanitizer initially and later products including laptops, office furniture and fitness equipment as more people worked from home and gyms closed.EBay has trailed Amazon in recent years and was pressured by activist investors Elliott Management Corp. and Starboard Value to slim down and focus on its core marketplace. The company in February completed the sale of its event-tickets marketplace StubHub to Viagogo for $4.05 billion. Earlier this month, EBay sold the classifieds business to Norway’s Adevinta ASA in a cash and stock deal worth $9.2 billion that leaves EBay with a 44.4% stake in the company.Iannone, who took the helm in April following the ouster last year of predecessor Devin Wenig, must show that a refocused EBay can compete with Amazon, which has benefited from a Covid-fueled surge in sales and is scheduled to report earnings Thursday. Meanwhile, Walmart Inc., which has invested heavily in online shopping options, will surpass EBay as America’s No. 2 online marketplace this year, according to EMarketer Inc.Iannone also inherited a scandal that prompted the firing of six executives indicted for allegedly cyberstalking a couple who published unflattering stories about the company during Wenig’s tenure.In the second quarter, EBay reported sales gained 18% to $2.87 billion. Analysts, on average, projected $2.8 billion. Earnings, excluding some costs, were $1.08 a share in the quarter, compared with analysts’ average estimate of $1.06.Shares dropped to a low of $52.48 in extended trading after closing at $56.35 in New York. The stock has gained 56% this year.(An earlier version corrected the analysts’ average annual profit estimate.)For 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) -- Google Chief Executive Officer Sundar Pichai highlighted a long list of digital rivals in his opening statement ahead of Wednesday’s hearing with the U.S. House of Representatives Subcommittee on antitrust.“When searching for products online, you may be visiting Amazon, EBay, Walmart, or any one of a number of e-commerce providers, where most online shopping queries happen,” Pichai said, according to a copy of his prepared testimony. “Similarly, in areas like travel and real estate, Google faces strong competition for search queries from many businesses that are experts in these areas.”Alphabet Inc.’s Google is about to be sued by the Justice Department in what will be the biggest U.S. antitrust case since the government went after Microsoft Corp. in the late 1990s. European regulators have already fined the company billions of euros for breaking antitrust rules in the region.Read more: Google Search Upgrades Make It Harder and More Expensive for Businesses to Win TrafficGoogle controls about 85% of the online search market in the U.S., and dominates the business even more in Europe. However, Pichai said in his testimony that the company is beset on all sides by rivals.“People have more ways to search for information than ever before -- and increasingly this is happening outside the context of only a search engine,” Pichai said. “You can ask Alexa a question from your kitchen; read your news on Twitter; ask friends for information via WhatsApp; and get recommendations on Snapchat or Pinterest.”Competition in digital advertising, from Twitter Inc., Facebook Inc.’s Instagram, Pinterest Inc., Comcast Corp. and others, has helped lower online ad costs by 40% over the last decade, and these savings have been passed down to consumers through lower prices, the CEO added.For 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.
Jul.28 -- Simeon Gutman, a Morgan Stanley analyst, expects Walmart to get more involved in healthcare. He appears on "Bloomberg Markets."