Business

How SAP and Qualtrics hashed out an $8 billion deal from 39,000 feet in the air

Of the many texts and emails that Qualtrics CEO Ryan Smith received since Sunday afternoon after agreeing to sell his software company to Germany’s SAP for $8 billion, one in particular stood out. It was from Utah Jazz star Ricky Rubio. The Spanish point guard congratulated Smith on the deal, but he was really texting about something else. Rubio wanted to know what the acquisition meant for 5 for the Fight, an organization launched by Smith and his family in 2016 to raise money for cancer research by encouraging people to donate $5 in the name of someone battling cancer. Local basketball fans know the slogan because it’s emblazoned on Jazz uniforms, and they know Qualtrics because the company is based in Provo, 45 miles south of Salt Lake City. For Rubio, the cause is personal....

Opening Bell: 11.13.18

Welcome to the new Opening Bell from The Water Coolest. We think you’re gonna like it here … Go home, you’re drunk [The Water Coolest] Diageo is divesting 19 of its “value” brands. You know, the ones best served in plastic bottles and consumed before 10 AM under a bridge. The lower end brands (read: the Camel cigarettes of booze) including Seagram’s Canadian whiskey and Goldschlager schnapps will fetch roughly $550M in cash. The buyer? Privately held US spirit maker, Sazerac. Diageo to Sell 19 Brands Amid Focus on Premium Spirits [WSJ] Jho Low can it go? [The Water Coolest] D-Sol and the Terrible, Horrible, No Good, Very Bad Day. Malaysia’s finance minister demanded a full refund for Lloyd’s handy-work on the 1MDB debacle that earned the company roughly $600M. News of the Malaysian governm...

Dow set for triple-digit rebound after tech-heavy sell-off

U.S. stock futures traded higher on Tuesday following a sharp downturn in the previous session. As of around 4:40 a.m. ET, Dow Jones Industrial Average futures rose 108 points, indicating a higher open of 112 points, while S&P 500 and Nasdaq futures were also in positive territory. On Monday, equities dived with the Dow falling just over 600 points amid a confluence of worries including a sharp decline in Apple’s share price, U.S. dollar strength and simmering global trade tensions. Shares of Apple closed 5 percent lower on Monday after Lumentum, one of the tech giant’s facial recognition suppliers, cut its outlook and said it received a request from a large customer to “materially reduce shipments” of its 3-D sensing laser diodes. As for trade, Bloomberg News o...

Prudential already has a large footprint in China — the challenge is to grow that, says its CEO

China is committed to opening up its insurance sector just as it’s indicated, but it will be on its own time, said Mike Wells, Prudential Group CEO on Tuesday. “Beijing is saying they have a plan for greater opening, and I think like everything in China the time frame is misaligned with U.S. time frames,” Wells told CNBC at the Singapore FinTech Festival. “You’re not going to succeed across Asia if you’re not successful in China,” Wells said. Prudential, Britain’s largest insurer, has been expanding into China for years. Prudential has a 50-50 joint venture with Chinese conglomerate Citic. “We have licenses in about 70 percent of the economic footprint now with China, so our biggest challenge is growing into that footprint quickly,̶...

‘Multiple and intertwined risks’ cloud outlook for the Middle East and its neighbors, IMF says

Major oil producing countries in the Middle East and its neighbors might benefit from higher crude prices in 2019, according to the latest outlook from International Monetary Fund (IMF), but there are numerous uncertainties in the region. The Fund’s latest regional economic outlook for the Middle East, North Africa, Afghanistan, and Pakistan (MENAP) region, published Tuesday, warns that “multiple and intertwined risks cloud the outlook of the MENAP region.” “These include a faster-than-anticipated tightening of global financial conditions, escalating trade tensions that could affect global growth and hurt key MENAP trading partners, geopolitical strains, and spillovers from regional conflicts,” the report stated. These risks could trigger a deterioration in fi...

One part store, one part lab: Mall owner debuts Brandbox, a new way to fill vacant space

One of the biggest mall owners in the U.S. has come up with a way to fill empty storefronts, and it’s offering young brands plenty of perks to move in. Macerich this weekend is launching a concept known as “Brandbox” at Tysons Corner Center just outside Washington, D.C., one of the most valuable shopping malls in the U.S. There, it will house six brands, including apparel retailer Naadam and makeup company Winky Lux, to start, for a period of six to 12 months. Each brand will have its own mini store inside a roughly 11,000-square-foot space, with new retailers funneling in and out each year. The mall owner says it will provide fixtures like shelving, data on foot traffic, RFID tagging for inventory, marketing and even help finding staffing — the retailers simply need to s...

Inward US Bound FDI

There’s been a drastic fall-off in inbound FDI. Figure 1: Inward US bound FDI, in millions $ (blue), 2017$ (red). NBER defined recession dates shaded gray. Trump administration denoted by orange shading. Deflation using CPI-U. Source: OECD, NBER, and author’s calculations. The decline in inbound FDI is remarkable given the buoyant stock markets around the world, and fast GDP growth globally.

Cramer Remix: Alphabet is FANG’s biggest conundrum

Stocks will only recover from Monday’s dramatic sell-off if seven key things happen to brighten the outlook for the broader market, CNBC’s Jim Cramer said as the major averages pulled back. “The thinking behind today’s action is surprisingly simple: money managers are buying the winners and selling the losers,” he said on “Mad Money.” “Unfortunately, there are a heck of a lot more losers than winners, and I want to put that into context because such behavior, frankly, is highly unusual this close to the end of the year.” One of the things that needs to happen, Cramer said, is the FANG stocks — his acronym for Facebook, Amazon, Netflix and Google, now Alphabet — have to stabilize. But of all the FANG members, “Alphabet is the bigge...

Cramer’s lightning round: How investors should approach the ‘best-in-show’ stock of Nvidia

Nvidia Corp.: “Yes[, this is a good time to start nibbling on Nvidia]. OK, Nvidia reports on Thursday. I think the quarter is going to be just OK, not great. I think your next quarter is going to have a product gap because they’ve got this Turing chip that is so smart that nobody’s running for it yet. But the answer is I agree. I’d buy a little before and then a little after. Do not make a big commitment because the stock is in free fall, but I like your thinking. Long term, it is the best in show.” Impinj Inc.: “This one is way too crazy for me. In this market, for identification [and] RFID, we like Zebra, not this one. Don’t buy.” Roku Inc.: “You’re still OK. It is coming down because it’s one of those situations where wha...

Cramer’s guide to knowing when a stock’s dividend is safe

In times of stock market volatility, investors tend to flock to “safe” stocks that offer steady growth and high dividends. But high-yielding securities can come with unexpected risks, CNBC’s Jim Cramer warned Monday as stocks traded lower. “The risks are enormous if you don’t know the pitfalls,” he told investors. “As much as we love dividends, they’re only worth chasing after if your payout is safe. So if you want some income from your stocks, you need to watch out for red flags.” The first red flag is when a company has a very high dividend yield, Cramer said. That tends to mean that investors, worried about potential dividend cuts, have been selling the stock and pushing the dividend yield percentage higher. But the more insidious wa...

As Amarin stock drops, CEO says investors should ‘understand our data better’

Amarin CEO John Thero shrugged off the stock’s decline on Monday, telling CNBC that any investor concerned about its latest clinical trial should take a better look at the data. Shares of the biopharmaceutical company closed down 5.84 percent on Monday after hovering down roughly 7 percent much of the day. “I think as people begin to understand our data better, they will appreciate that this drug does much more than lipid modification,” Thero said on “Power Lunch.” Amarin shares finished the day at $19.82 after researchers began comparing the full study of the clinical trial for its fish oil capsule, Vascepa, released over the weekend, to September’s preliminary results. The stock surged 300 percent after those early results, which showed the drug could ...

Apple analysts have a long history of misreading weak iPhone demand based on supplier rumors

Stop me if you’ve heard this one before: An Apple analyst cuts iPhone shipment estimates based on weak supplier guidance, sendingthe company’s stock is tumbling. That’s the situation Apple was in Monday. Shares were down more than 4 percent, leading the overall market to painful declines, after iPhone supplier Lumentum cut its outlook. It’s far from the first warning about iPhone shipments from the industry’s top analysts. This time it’s TF International Securities analyst Ming-Chi Kuo cutting estimates for the iPhone XR. In October, it was Goldman Sachs and estimates for the company’s sales in China. Before that, it was Nikkei, Citi Research or Barclays Capital, lowering their respective estimates for the iPhone X, the iPhone 8 or the iPhone 5 ove...