Citigroup Sees Growth in Spain

Spain is one among the five biggest sources of income for Citigroup within Europe, the Middle East and Africa. It gets more of its revenue outside its home market in comparison to other U.S. lender. Citigroup Inc. (C) is expecting an increase in it's revenue in Spain by 5% to 10% in 2015. It is aware of fees from managing bond sales and share offerings to drive revenue in Spain.


According to the company's spokes person,“Large market capitalization companies always had access to capital markets, but medium-sized ones and companies with lower than investment grade rating needed access, and this has started to change in recent years.”

He added, “Equities will also have a good year in 2015, mainly through capital increases and accelerated equity offers.”

Chief Executive Officer Michael Corbat is working on plans to streamline the bank. The bank is leaving consumer banking in slow growth markets. It's the world's largest lender before the 2008 financial crisis. The bank is pulling out consumer banking from Spain including Japan, Egypt and Hungary. The bank sold all 45 branches, along with its credit card business in June.All together 950 people worked there. Those branches werr sold to Banco Popular Espanol SA (POP) for $296 million.Currently Citigroup now employs 260 people in Spain.

The bank expecting to build its business in Spain as the country recovers from a two-year recession and a sovereign debt crisis that led the government to seek aid from the European Union to recapitalize local lenders.

Country Officer William Van Dyke said,“The dynamics in the Spanish economy are better and we see an opportunity to strengthen and grow our balance sheet in the country.”

Spain is providing a 10-fold profit to Citigroup in comparison to 1990. It has $25 million in assets and increased revenue of 10% to 19% every year for the past seven years. It earned $75 million in fees from investment banking in the year through September in Spain. It has 5.6% market share and has to compete with Morgan Stanley.

The bank has client base of 60 companies. Citigroup arranged Spain's 10-year government bond issue in January and a five-year inflation linker in October.

Apple after Steve Jobs worth $700 billion

Apple (AAPL, Tech30) seems to have flying colors when it comes to the world's most valuable companies. Apple is the king among them. Now, it's worth is $700 billion after its stock hit a record high on November 25,2014. It is $300billion more than the second most valuable company, Exxon Mobile (XOM).

Tim Cook seem to be a terrific CEO and strongly living the dream of Apple' founder, Steve Jobs.
At present Apple is double of Google's (GOOG) worth. His leadership and ability which were doubted, now it seems the CEO's limits are far more than expected.


Apple's shares are up by 50% to be around $150 per share, all time high. This was supported by the introduction of  Apple's iPhone 6 and iWatch and mobile payments platform Apple Pay. Further more investors are easily accepting such high price for the company because of the buybacks and steady dividend payments. But as always, many believe the stock will continue it's historic run.
According to FactSet, three quarters of analysts give Apple a  "buy."

Apple did a 7-for-1 stock split in June, so investors who recall when Apple hit $700 a share in September 2012 can think of the current price as $838.

Within the S&P 500 index, Apple  inc. (NASDAQ:AAPL) does not break records for market cap size in terms of valuation. Microsoft Corporation (NASDAQ:MSFT), at its peak, accounted for almost 5% of the total index value, while International Business Machines Corp. (NYSE:IBM) accounted for 6% in the 1980s. Currently, Apple has a weighting of less than 4% in the index because the S&P 500 has risen to record levels. In addition to that,Apple currently trades at a price-to-earnings ratio of 18, compared to 72 for Microsoft at its peak. It even underwent stock split. Apple did a 7-for-1 stock split in June, so investors who recall when Apple hit $700 a share in September 2012 can think of the current price as $838.

According to legendary investor Carl Icahn, the stock could be worth $203 a share. That would value it at over $1 trillion. That means it should rise 70% more than from their current price.

Apples's share must rise by 43% from current market price in order to reach that record-breaking milestone.

Juniper Networks Inc. (JNPR) is paying $14.5 million to new CEO Rami Rahim

According to a filing, Rami Rahim, new CEO of Juniper Networks Inc. (JNPR) is getting a compensation package totaling about $14.5 million.

According to that filing, Rahim will be paid an annual salary of $1 million, $5million restricted shares,  a target bonus of as much as $1.75 million, an equity award valued at $6.75 million and $5 million in restricted shares.

Shaygan Kheradpir is Rahim's predecessor. He is earning an almost identical package to his predecessor, who stepped down on Nov. 10. Kheradpir was also eligible for a $5 million signing bonus.


After Kheradpir was pulled down, Rahim was appointed CEO earlier this month after Kheradpir stepped down following a board review of his conduct related to a customer negotiation. Rahim, 43, joined Juniper in 1997 and has helped develop some of its key products. He has won praise as a technologist who knows Juniper’s products well.

Juniper seems to tackle  numerous challenges this year, including executive shifts and activist pressure amid shrinking revenue. Kevin Johnson was replaced in January and that same month, activist hedge fund Elliott Management Corp targeted Juniper. The company bowed to Elliott’s pressure for cost cuts and share buybacks, unveiling plans to return at least $3 billion to shareholders and to reduce $160 million in expenses.

Discount Investment Shares, Bonds seem too risky to invest

Shares and bonds of Discount Investment Corp. (DISI) are sliding downwards because investors are questioning that the holding company may struggle to repay debt after an IPO of a subsidiary was pulled by the company.

Discount’s 2.8 billion shekels ($725 million) bonds due  Dec. 2025 got the yield of 4.95 percent and it raised 1.3 percentage point to 7.39 percent, the highest this year. But its stocks plunged 24 percent to 9.50 shekels. This means that they have dropped 62 percent this year. On the other hand, shares of parent IDB Development Corp. dropped to 2.135 shekels, which is 17% down.

The world's largest generic agro-chemicals,Adama Agricultural Solutions Ltd. failed to make agreement with investors on pricing. Then it postponed an initial public offering. Currently, Discount has 40 percent of Adama. However, IDB seems to wait for a successful IPO to inject value into the company and refinance debt. IDB has Argnetine businessman Eduardo Elsztain and Moti Ben-Moshe. After Nochi Dankner failed to bring in investors for the company to repay debt, he stepped down.
Yaniv Pagot, chief strategist for Israel-based Ayalon Group Ltd, said,“The company has enough cash to repay debt comfortably till 2016, but what will happen once that cash ends, from 2017 onwards?”
He added that Discound could have used valuation of Adama as collateral to refinance debta and raise additional funds by selling shares in a secondary offering.

At the end of June, Discount had cash and cash equivalents of 1.86 billion shekels and according to the second-quarter result, it had net debt of 3.4 billion shekels.

Goldman Sachs Group Inc. is trying to avoid congressional scrutiny by detaching two commodities units

Goldman Sachs Group Inc. is avoiding congressional scrutiny by detaching two commodities units. One among two paid back it's investment in less than four years and remaining other is still on coa in Colombia


According to documents released by the U.S. Senate Permanent Subcommittee on Investigations, Goldman Sachs bought Metro International Trade Services LLC for $451 million in 2010. It's a  metals warehouse operator. In September 2013, the banks's board viewed a presentation that showed $465 million of gains from the investment. The profit excluded carry charges.

Head of Goldman Sachs’s global commodities principal investments group,Jacques Gabillon, said at a Senate hearing that the firm has received interest from potential buyers in Europe, Russia and China and it is still in the sales process for Metro International Trade Services LLC. The subcommittee chairman, Michigan Democrat Carl Levin, accused the bank of using Metro to improperly influence aluminum prices. Gabillon denied that the bank is involved in influencing aluminum prices.

As aluminum investor rose, Metro International Trade Services LLC increased its warehouses and  a plunge in demand for the metal after the financial crisis. Upto now the stake had returned $501 million in dividends. It had a carrying value of $396 million with debt.

There's still other profitable investment of Goldman Sachs. In 2003, the company purchased Cogentrix Energy Inc. for $457 million. Over the life of the investment it realized $1.75 billion of gains.


Related:
Goldman Sachs posts earnings, revenue that beat expectation

There was not always profit for the company. As of the September 2013 presentation, Goldman Sachs paid $569 million for Colombian Natural Resources, which had produced total gains of $2 million as of the September 2013 presentation. CNR even estimated last year additional cost upto $220 million for port.

Goldman Sachs bet that the price of coal would fall. It produced $246 million of gains, according to the 2013 presentation. According to the report from senate the firm is considering selling its CNR stake.

Areva had a net loss of 694 million euros ($870 million) in the first half.

After the French nuclear firm suspended its financial targets for 2015 and 2016, Areva SA dropped the most since 1999. Due to delays to a Finnish project and slow demand in japan, the French nuclear reactor maker abandoned financial targets for the next two years. The shares slumped as much as 23 percent.

Areva announced that  it was reviewing both its future goals and mid-term funding plan. However, Areva said both its revenue and profit forecasts for this year would not be affected.

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Areva is owned by French government which has 87%  and it is expected that it would present a new financial outlook for 3 years of it's full result.

With series of warnings in recent months, the firms makes an announcement.A series of warning were there in recent month. It reported a €694m (£555m) loss for the first half of the year in August and said 2014 revenue would fall 10%, more than the 2-5% drop it originally forecast in February.

In October, it also announced new assest sales and capital spending cuts

Following the 2011 nuclear accident in Fukushima, which was triggered by a massive earthquake and tsunami, and the rise in the use of shale gas in the US.

Areva’s 750 million euros of 3.125 % bonds due March 2023 dropped 4.1 cents on the euro to a record 93.1 cents, the biggest drop since the notes were issued on March 12.

The company’s 1 billion euros of 15-year notes sold in September 2009 plunged 5.8 cents to a two-year low of 102.6 cents, the data show.

Areva had a net loss of 694 million euros ($870 million) in the first half.

Areva Data:

Airbus profits rise 16% to €1.399bn but more A400M is still making it's operation difficult

Airbus reported net income rose 16% to €1.399bn.This is the first time that Airbus reported a rise in profit for the nine months of the year. The report also came with a warning of more problems for its A400M military plane. Revenues rose 4% to €40.5bn and underlying earnings rose 12% to €2.59bn ($3.2bn; £2.1bn) for the nine-month period.

Currently: AIR:FP  48.4550 EUR + 0.7550  +1.58%

A400M military plane has problem related to negative cost and risk evolution. In 2010, problem started to delay it's production and received a bailout of €3.5bn. There were cost of €20bn with orders from several European countries and A400M has a fixed-price contract that hit production problems and cost-overruns. Except A400M, Airbus's products are doing great.

Airbus is taking responsibility of any future impact in its full-year results to be published early next year.

Harald Wilhelm, chief finance director of Airbus,told journalists: "Given our past history on it (the A400M), the objective remains to avoid any incremental charge, but we are on the way to assessing it. If you ask me whether I can exclude it, I cannot say that this is the case, so it's work in progress."

The order book up to the date 30 September, it was worth €765.4bn while it was worth €680.6bn at the end of 2013.

Tom Enders, Airbus Group chief executive, said: "An improved operational performance drove revenues and profitability higher over the first nine months of 2014."

The environment is not yet favorable, adverse exchange rate is affecting it's profit of last three month.
See Nissan's profit rise due to favorable exchange rate.

Airbus Data:

$4billion fine to Six banks in currency probe

Each day $5 trillion is traded in the global currency market. London has a huge part in it. Forex rate touches various part of economy: outsourcing cost, export price, price of imported goods, company earnings and many investments held by pension funds and others.


HSBC (HSBC),  RBS (RBS), Citibank (C), JPMorgan Chase (JPM) and UBS (UBS) will collectively pay $1.4 billion to the U.S. Commodity Futures Trading Commission and about £1.1 billion ($1.75 billion) to the U.K.'s Financial Conduct Authority. UBS will also make a payment in Switzerland.
In total it's $4.33 billion in fines to global regulators to resolve allegations that these six banks attempted to manipulate foreign exchange rates. The British regulator is imposing such huge fines for the first time. It is still investigating possible manipulations at Barclays (BCS). British regulators said 36 banks that operate in the foreign exchange market, including the five fined Wednesday, will be required to participate in a program to change banking culture and ensure management take more responsibility.

According to the U.S. Office of the Comptroller of the Currency said Bank of America (BAC), Citibank and JPMorgan Chase will pay a combined penalties. It's been said that it's $950 million in penalties.

CFTC's director of enforcement, Aitan Goelman said,"The market only works if people have confidence that the process of setting these benchmarks is fair, not corrupted by manipulation by some of the biggest banks in the world."

Between 2008 and 2013, traders shared confidential information and worked with their counterparts at other institutions in an effort to fix rates and increase profits. Traders were working for the profit of banks rather than their client. Regulators said they used private online chatrooms to execute deal to shift currency prices in their favor. These traders called themselves "the players", "the 3 musketeers" and the "the A-team." They try to manipulate the so-called 4 p.m. fix, a 60-second snapshot of afternoon trading in London that forms the basis of a widely-used benchmark.

The banks and traders behaved unacceptably and it could go further o investigation. The banks and individual employees might also face criminal charges in both the U.K. and U.S. over attempts to manipulate the rates. The Federal Reserve is also anticipated to be investigating banks' conduct in the currency market.

UBS was also penalized by Swiss regulators. It will pay a total of $800 million. Citibank will pay the second largest total fine at $668 million.

The CFTC said it has fined more than $3.34 billion relating to the manipulation of global benchmarks since June 2012.

Berkshire's earnings takes hit, but Buffett is still surpassing the expectation

Buffett’s personal wealth notched up by about $55 million

Berkshire Hathaway (BRKA) had a huge hit on earnings during the third quarter. Even then the earnings were better than anticipated. The investment company took a massive $678 million charge for its investment in Tesco (TESO). Tesco admitted to overstating its profit forecasts.

Berkshire A shares hit a new 52-week high. It crossed the $200,000 mark for this first time this summer and finished regular trading Friday at $214,970 a share. Later it hit $215,925 in intra day trading. On the other hand, Berkshire’s B shares finished the day up slightly at $143.61 and raised few cents higher after the bell. They are worth 1/1500th of their pricier counterparts and they were flat in after-hours trading.


The portfolio of Berkshire is still ahead for the year. It earned $4.6 billion, or $2,811 per Class A share during the third quarter. There was expectation operating earnings of $2,593.85 per Class A share.It's down by 8.6% from the same period last year, that's better than Wall Street 's expectation. Operating profit rose to $4.72 billion, or $2,876 per class A share, from $3.66 billion, or $2,228 a class A share. Revenue rose to $51.2 billion from $46.5 billion. Profits for the first nine months of the year are more better than that of 2013. Next quarter is not expected to go well. Berkshire lost big money late last month on shares of Coca-Cola (KO) and IBM (IBM, Tech30). These companies delivered disappointing earnings.The investment firm took a $1 billion hit on Coke (KO), which fizzled 6% after the company reported earnings that didn't live up to expectations of investors. Worsening the situation, Coke said it doesn't expect a much better 2015.

Berkshire Hathaway's one of the largest investment is Coke. It holds 400 million shares and his son Howard sits on the beverage company's board.

IBM (IBM, Tech30), another top holding, caused Warren Buffett a loss of $1.3 billion as the stock plunged. The company is looking for a revitalization after reporting disappointing earnings and shedding its chip unit at a major loss.  Buffett's company, Berkshire Hathaway holds over 70 million shares.

Today's Range	142.87  -  143.99		EPS Due Date	3/3/2015 Est
52-Week Range	108.12  -  143.99		EPS % Chg (Last Qtr)	29%
Price % Chg. YTD	21.13%		3 Year EPS Growth Rate	14%
Price % Chg. Last 4 Weeks	4.76%		EPS Est % Chg (Current Yr)	7%
50-Day Avg. Volume	3,784,400		Annual ROE	7.39%
Shares Outstanding	1181.9 Mil		Sales % Chg (Last Qtr)	10%
Float	1170.0 Mil		3-Year Sales Growth Rate	12%
IPO Date	N/A		Debt %	33%
Investment Bank	Salomon Smith Barney		Market Cap	$354.22 Bil
% Mgmt Owns	0.4%		Profit Margin	12.1%
PE Ratio	22		Sector	Misc
Dividend Yield	NONE		Industry Group Rank	77
Alpha	0.03		Industry Group	Diversified Operations
Beta	0.92

Nissan has reported a 25% increase in half-year profits

Nissan reported net income of 237 billion Japanese yen($2.08billion). It's 25% more in half-year profits. The Japanese car maker is supported by strong sales in North America and there are signs of stabilization in western Europe.
With £1.3bn net income, it said it had seen "strong demand" for its new products and there is rising sales in its key market of North America.

Nissan and other car makers in Japan have strong advantage due to weaker yen. This is making Japanese products cheaper when they are exported. The yen depreciated after Friday's surprise decision from the Bank of  Japan to expand it's stimulus measure. The central bank is continuously attempting to boost economy and lift inflation in Japan.

The cost of Japanes goods sold abroad are affected by weaker yen. Nissan said that weaker yen would help to increase sales in China and some other nations. Nissan's chief competitive officer Hiroto Saikawa said that "all in all we think it is positive for industry and the economy".

At the beginning of this year, there was a 10% rise in Nissan's full-year profits which was made possible by increased sales, weaker yen and reduced cost.

Nissan's sales was up by 5.8% compared with the same period a year ago. It sold 2.58 million vehicles in the six-month period.

Carlos Ghosn said,"Nissan successfully overcame challenging market conditions in the first-half of the fiscal year, delivering solid revenues and profitability amid encouraging demand for our latest models."

"This offset slower demand in Japan and continued volatility in Russia and other emerging economies."

Nissan's sales is affected by a slowdown in China. It's the worlds largest car market. In addition to that Japan's consumers are still recovering from a sales tax hike in April. While things are going on it's way Nissan revised its full-year sales forecast down by 200,000 to 5.45 million reflecting lower than expected sales in China and other new markets.

Today5d1m3m1y5y10y

52wk high:20.27

52wk low:16.45

EPS:N/A

PE (ttm):N/A

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Market Cap:42.07b

Volume:140,668

Alibaba's(BABA,Tech30) Rise after it's IPO

Alibaba's initial public offering on September 19 might just have been the top for the bull market-some expert decleared.Now, Stocks have jumped back to the show after solid earnings reports. The Dow & S&P 500 both hit all-time closing highs on Friday and Alibaba (BABA,Tech30) was leading the way.

Alibaba's(BABA,Tech30) stock raised 7% from its first day closing price and more than 20% above its post-IPO low point. There was a 3% price up on Monday. That was a new high. That Monday's rally made Alibaba worth more than Wal-Mart (WMT).

Alibaba worth more than Wal-Mart (WMT)

It's been always anticipated to be a part of bull market appreciation. Now, Alibaba has a chance to prove that valuation at the time of IPO are still valid and can be justified. The company will release its first earnings report since its IPO on Tuesday morning. Analysts are expecting high.

The estimation of about $970 million or 44 cents a share are being expected according to FactSet. It would be an increase of 20% in comparison to last year. There is estimation of 45% sales growth, $2.6 billion according to Wall Street. 

Stocks of Alibaba are doing well. It surged 38% on the first day of trading. The expectations are extremely high. Alibaba seems to be likely to beat earnings and revenue estimations. This will justify the stock price. Analysts will be specifically interested in knowing how strong Alibaba's mobile business is.

There is trading of shares at about 45 times earnings forecasts for the current fiscal year that ends in March.

Alibaba is given $110.32 consensus price target by Wall Street and it's been anticipated to go further more if report is strong. It has a market value of $250 billion, is also worth more than American online retail giants eBay (EBAY, Tech30) and Amazon (AMZN, Tech30).

There is  Alibaba-Amazon comparisons being made after Alibaba made decision to go public.

Microsoft ends retail sales of Windows 7 and 8

The next version of Windows, called Windows 10, is due to be released in late 2015.

The retail sales of Windows 7 and 8 has been officially stopped by Microsoft. Microsoft is taking this action to attract customers to more recent versions of it's product. The conclusion is made strong by statistics suggesting people are finally moving away from some very old versions of Windows. There  is anticipation of people adopting new version of Windows. The next version of Windows, called Windows 10, is due to be released in late 2015.

This decision might even affect the market share of the company. Even though the straight estimation of users adapting new version seems promising, there's still chance of decrease in over all sales and revenue collection till the operating period.

After Q1 report it railed up and now decision to stop sales of Windows 7 and 8 seems attractive.

Consumers are not able to purchase copies of the Home Basic, Home Premium and Ultimate versions of Windows 7 from 31 October. Windows 8 is also no longer available. Copies bought in shops or loaded on PCs and laptops are also affected by the change. All the PCs will have Windows 8.1 as default version. It's current version of windows.

There are many PC makers and they have large stocks of older versions of Windows. So, immediate change might not occur in the market. They will be selling PCs with older version of Windows. There's still a way if you want Windows 7. Users will be able to "downgrade" from 8.1 to Windows 7 Professional and very few PC firms have this option.

Microsoft is trying to distance itself from the original form of Windows 8 even though it is released just over two years ago. Windows 8's original version was not able to live up customers expectation as it lacked some familiar elemets of the desktop version of the operating system.

Windows 7 has been available since late 2009 and is still very popular among users. About 53% of Windows users are on the various editions of Version 7 of Windows. The more recently released Windows 8 has only grabbed a 6% market share and has already been surpassed by 8.1.

Data from Netmarketshare suggests that in October this year users using Windows XP dropped from almost 24% to just over 17%. It is not yet clear what was behind the fall.