“It went great, the judge bitch-slapped the government, again” — Infamous pharma bad boy Martin Shkreli, after leaving the courthouse where a judge delayed the scheduling of his trial.
MARKET SNAPSHOT
Big Picture
- U.S. stocks finished way up, with the S&P booking its best finish of the year as Fed Chairwoman Janet Yellen signaled that despite a less-than-stellar jobs report, rate hikes are still on the table
Market Movers
- If you were one of the select few that owned stock in tiny Helios and Matheson Analytics, you had a great day yesterday. Shares rose a whopping 500% after the company announced a merger with Zone Technologies Inc.
- Shares of Boeing were also up (unfortunately not 500%), making it the biggest gainer in the Dow after a report showed it was in negotiations with Iranair to build over 100 jets to replace its aging planes
CORPORATE PRIMER
Scripps Scoops Stitcher…
…Say that one five times fast. Yesterday, media giant E.W. Scripps announced the tongue-twisting acquisition of podcasting app Stitcher. Scripps has been moving away from its origins in newspapers and TV stations toward the digital realm….and how does it aim to get there? Acquisitions, obviously. Since Stitcher features podcasts from NPR and the Wall Street Journal (among 65,000 others—not the Brew…yet) and has over 8 million users, we’d say this particular buy makes a whole lot of sense.
Devon Loses Weight
Devon Energy has sold a portion of its assets for nearly $1 billion and is looking to divest even more. Uh, why? The reasoning behind the madness is an attempt to freshen its finances, something the company has been wanting to do for a few years. Simply put, it’s a long-overdue cleanup. Devon plans to continue divesting its assets, predicting that by the end of the year those sales could total $2-3 billion. Good looks, Devon.
Going for Gold
Been wondering what’s new with Goldman Sachs? Let’s check in. The latest: Goldman up and sold stakes in five hedge funds to Affiliated Managers Group for $800 million. Goldman plans to switch up its investing track, and earning $800 mil in fast cash in the process isn’t a shabby way to go about it. AMG is also sitting pretty, as the deal pushed up its total assets by $55 billion. And that’s what’s new with Goldman.
Cisco Power Struggle?
Trouble is brewing at Cisco, as four long-time product executives have resigned from their positions in the telecom company. The execs, who together launched a startup that was eventually bought by Cisco, are famed for building the company into what it is today. So why are they calling it quits? CEO Chuck Robbins decided to do an internal reorganization of the company, which changed the titles of the execs to “advisors” rather than “senior vice presidents.” Semantics or a game of thrones?
OTHER STORIES
- Line plans year’s biggest tech IPO
- General Mills to launch first new cereal in more than 15 years
- Burberry CEO gets 75% pay cut
- McDonald’s Japan is giving away a golden chicken nugget
ECONOMIC CALENDAR
- Monday: Janet Yellen Speech
- Tuesday: Valeant Earnings; Productivity and Costs
- Wednesday: Lululemon Earnings; Job Openings and Labor Turnover Survey
- Thursday: H&R Block Earnings; Weekly Jobless Claims
- Friday: Consumer Sentiment
THE BIG FIVE HUNDO
Look alive, folks: the Fortune 500 2016 rankings came out yesterday, and it’s a pretty big deal. How big? For starters, the top 500 companies in America represent a whopping two-thirds of GDP. Walmart clinched the #1 spot for the fourth year in a row, and Apple skipped its way from fifth to third place. And here’s the rest:
- Why are the companies on the coveted Fortune 500 list so important? Companies are ranked by total revenue, and overall, the top 500 bring in a sum total of $12 trillion in revenue, $840 billion in profits and add up to $17 trillion in market value. Feel free to read that again.
- Oh, and they employ nearly 30 million employees worldwide. That’s the entire population of Australia, with Singapore thrown in there just for fun.
- With so much at stake, these 500 had better be doing well…right? Eh. Revenue was down 4.2% compared to 2015. Even worse, aggregate profits were down by 11%.
- Who’s to blame? You guessed it: oil. 62 of the 500 companies are in the energy sector. They haven’t exactly enjoyed the low oil prices—and they’ve got a net loss of $44 billion out of $1.3 trillion in revenues to show for it.
INTERVIEW QUESTION OF THE DAY
Company A has $100 of assets while company B has $200 of assets. Which company should have a higher value? (Answer)
BUSINESS TERM OF THE DAY
Credit Default Swaps — Derivative contracts that were invented in the late 1990s and are a form of insurance on bonds issued by companies or countries that investors buy and sell. If it looks like an issuer might have trouble paying, its credit default swap price rises because the bond is riskier and will cost more to insure.
FOOD FOR THOUGHT
$14,922,261.76 — Amount of medical debt that John Oliver helped eradicate when digging into the billion-dollar debt-buying industry on his show. Debt buyers purchase delinquent debts from creditors for pennies on the dollar and then make their own attempts to collect, oftentimes using scare tactics.
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