Alibaba Comes Up With A Chinese Online Food Delivery Service

Alibaba has vowed to invest $1.25 billion to come up with a Chinese online food delivery service.

 Alibaba Group Holding Ltd. has finally agreed to make a massive investment worth US$1.25 billion. This investment is made in the online Chinese food delivery known as Ele.me, as reported by a renowned business weekly, known as Caixin, on Friday.

According to the report provided by an unidentified sourced, Alibaba Group will get around 27.7% stakes in Ele.me, and this is will make it the biggest stakeholder in the venture. So far, Ele.me and Alibaba have refused to comment on the matter.

Ele.me, which apparently translates into “Hungry Now?” has become part of the everyday life in China, which comes under the criterion of online-to-offline (O2O) services. This service will comprise of facilities like reviewing apps for restaurants along with taxi hailing that will link the users on smartphones with offline business ventures.

During the beginning of 2015, the food delivery service has been successful in raising US$350 million from various investors. This includes big names, such as Tencent Holdings, Sequoia Capital, JD.com, CITIC Private Equity, and Dianping.

Things are changing with time where the locals are completely dependent on smartphones for their everyday chores. Bookings and reservations for restaurants are even done from their smartphones with convenience. The internet tycoons in the Chinese market, such as Baidu, Tencent, and Alibaba are investing heavily in services of this nature that will help them to lure more users on their ecosystem.

Alibaba has made a mark in the Information Technology sector becoming the largest ecommerce company. Tencent and Alibaba have been spending heavily in services of a similar nature where both the organizations have accumulatively invested more than US $8 billion in the previous year. The services are quite similar in nature to that which is used to hail taxis, such as Didi Dache and Kuadi Dache, as reported by Reuters.

Hence  the efforts by Alibaba in the Information Technology sector are commendable and deserve to be appreciated since both these companies are revolutionizing the Chinese market. There is a dire need for services of similar nature, as the world needs to have everything conveniently placed in the form of apps in their smartphones. A food delivery service in the form of Ele.me will not only satisfy the cravings of the masses but in return, will churn out a lot of revenue for them. All over the world, consumers need fresh food; thus, what could be better! The Chinese corporation is also excited about the investment.

Jack Ma Is A Smart Businessman Says Analysts

Analysts believe that Jack Ma is playing a smart move by putting in a bid for Hong Kong based newspaper.

It has been on going for quite a while now that the founder of the Chinese tech giant, Alibaba Group Holding, is looking to make its way in the print media business. Jack Ma seems interested in buying the South China Morning Post for a long time now however the deal is still in hanging as only interest has been confirmed from both companies. It is very well known that the Hong Kong based English newspaper is currently struggling in the market therefore analysts believe that Ma’s offer is the only way to save it from crashing down.

Jack Ma has planned to meet the buyout for the Hong Kong based newspaper in order to re launch it in a better way. Not only it will be beneficial for him or Alibaba Group but for the South China Morning Post as well. It is still unclear whether Jack Ma wants to acquire the newspaper company or Alibaba does.

The newspaper was known as one of the most biggest and famous back in the days. It was founded in 1903 and has ‘long given international readers an insider's perspective on Hong Kong and the mainland, providing a window on events from the Mao era to China's 1980s economic awakening and the 1997 handover,’ according to a source.

However it failed to keep up with the media industry and gradually subscribers, sales, and profits have evaporated. Furthermore, the company was hit by a massive downfall, industry wide, in terms of advertising revenues. Since then, South China Morning Post is unable to keep up with its standard business and the transformation phase to the digital age.

Jack Ma is very much interested and sources familiar to the matter state that the talks regarding this deal are in now an advanced phase. Mr. Ma would probably buy a stake in SCMP and several analsyts including Jackson Wong thinks that it is a clever move from the Chinese internet tycoon.

Jackson Wong adds, “He has tons of cash and he knows how to run a business in China very well. Links with Alibaba would also give the paper a necessary boost in terms of its online platform.”

Jack Ma indeed is a smart businessman. He realizes that at this moment, he has all the power to do anything in the Chinese tech sector. Therefore he along with his business, Alibaba, is trying to expand in further business categories as soon as possible. Apart from the e-commerce business, Alibaba’s Aliyun is known as the power house in cloud computing business.

Costco Wholesale Corporation Was Being Traded At $156.45

The wholesale company has reported a growth in earnings per share of 15.50%.

On November 17, 2015, Costco Wholesale Corporation was being traded at $156.45; this determined a different of 1.81%. In one year’s time, the company has reported earnings per share growth of 15.50%. The wholesale company has a return on investment of 14.50%. According to predictions by sell-side brokerage firm that wholesale company will post earnings per share of $1.3 for the current quarter of Fiscal year 2015.

The most recent EPS reported by the wholesale company was $1.73 for the fiscal year that ended on August 31, 2015. The difference between the predicted earnings and the actual earnings was of 0.07, a 4.22% difference. The company will need to be on its toes as any firm that beats the estimates of brokerage and financial services firm are rewarded well with a higher share price while if it keeps on missing the estimates of the analysts, the stock of the wholesale company will not do well.

As per the consensus of analyst on the one year target price of the company, the stock is expected to be at $161.2 per share. This consensus is based on an observation of 15 research firms. The highest level to which the target price is expected to be seen is at $185 while the lowest it could go to is $136. Costco stock has fluctuated in between a range of $156.47 to $153.24. The trade was called off at a share price of $156.45. Zacks, a research firm, has given a ranking of 1.79 to the wholesale company which identifies it as a Buy rating.

A number of brokerage firms have commented on the shares of the company and have also recommended target prices. Out of the 10 analysts who have commented on the shares of the wholesaler, 6 have rated it as a Buy while 4 have added it to the list of Hold. Telsey Advisory Group has given a new target price of $175 which the financial services firm has decided to maintain from an initial target price of $160. On the other hand, Oppenheimer has increased its target price estimate to $180 from $160. North coast has downgraded the rating to Neutral from an initial rating of Buy.

Insider Stock Buying was observed in the company; the Director of the Wholesale Corporation bought 10,000 shares at a share price of $155.40 per share. This transaction was worth $1,553,968. Now the director, Stanton John has a stake of 13,456 shares in Costco. 0.50% shares of the wholesale giant are owned by the company while 73.40% are owned by Institutional Investors.

Bill Ackman Accused Of Insider Trading In Allergan Plc Faces A Lawsuit

Bill Ackman faces a U.S. shareholder lawsuit over accusations of insider trading in Allergan Plc.

Allergan was victimized of insider trading by Bill Ackman and Valeant Pharmaceuticals International, who now face a lawsuit, involving a failed offer. The lawsuit has been filed in favor and protections of the investors who sold their Allergan shares.

After losing the deal with the Pharmaceutical Company, Valeant has reportedly been facing issues; it also puts an end to its partnership with Philidor Rx Services, a mail-ordering pharmacy. Both the accused parties say in their defense that they did not have any intentions of fraud and did not cross any boundaries of duties through sharing and publication of information before the takeover, but the judge does not agree or favor them. 

Mr. Ackman sympathized with Valeant saying that it was a victim of fear and panic. His Pershing Square Capital Management is on the third number of the shareholders list in Valeant even though the shares have fallen by 70%.

Both parties are accused of engaging in a scheme that would make the medical services company’s shareholders go into deficit of money, violating the laws of Federal Securities. Ackman is accused of attaining 10% of the share of the pharmaceutical company and using them to help the Canadian company.

The medication company has also accused Ackman and the company he favors of insider trading in another lawsuit that was put to an end in April. The judge dealing with this controversial case is David Carter in California. He denied the request of Ackman and his favorable company’s dismissal of the lawsuit.

A spokeswoman for Valeant, Laurie Little, made an emailed statement saying, “We acted at all times in consultation with our legal counsel and remain convinced that our actions complied with the securities laws. While we are disappointed the Court allowed the claims to continue following this preliminary motion, we look forward to presenting evidence to establish that we did nothing improper.”

Actavis Plc. bought the pharmaceutical company from Dublin in March for $70.5 billion. Both merged and renamed to Allergan Plc. Not long after this merge, the company had to file a lawsuit of insider trading on Ackman and the Canadian medications company he favors, which ended, and this recent case has now become known. Now Michael Shipley is defending the accused as their lawyer, who refused to make any comments regarding the case and the companies as a matter of professional integrity.

Allergan stock closed at $300.20 on November 13.

Amazon Fire Tablet Is A Must Buy

Amazon Fire Tablet is valued at an economical price of $50 only.

Amazon Inc. is one of those companies that really like to expand its product categories. The company was initially known as an online retailer, which is now the world’s largest online retailing company. It further expanded its business category and entered the smartphone and cloud computing businesses. According to recent news, it seems that the online retail giant is all set to make its way in the tablet business as well. The company will be launching a medium end inexpensive tablet that would cater the normal needs of a tablet user.

Amazon has named it as a ‘Fire’ tablet as well. The company named its first smartphone as a ‘Fire’ Phone too, which did not do much business since its launch. In the market, companies like Apple and Samsung currently make high-end tablets. Apple iPads are extremely overpriced and a normal individual might not be able to afford it. The quality is top notch but the price tag is on another level as well. Know that the least expensive iPad is priced at $269. Amazon has targeted this market. Its Fire Tablet is available for only $50.

The tablet has a metal body and its design cannot be compared to that of Apple iPads. Furthermore, its processor is a bit slow as well along with a smaller screen size. However, if you are comfortable with average performance, graphics, and screen display or resolution, then this tablet does deliver amazing value. Fortune puts the situation in this way, “A price tag like that makes it hard to gripe about the Fire’s flaws. You are buying a Ford Fiesta, here, not a Lexus. Both will get you to your destination; one just does it slower and without all the bling.”

The company is still focused to keep selling all of its movies, TV shows, music, and books instantly, which are not included in its Prime program. However, it believes that its new Fire tablet can do wonders alone in the market. According to Fortune, the company expects all Fire tablet buyers to have a Prime subscription. Amazon Prime membership is available for purchase at a price of $99 where it offers a lot of free content with it such as music, movies, TV shows, books, and an excellent two-day shipping service to its members.

Amazon, at this moment, does not want to compete with Apple in the high-end tablet market. It has targeted a perfect audience that is looking for an inexpensive average tablet. 

Alibaba Adds Russian Merchants In Order To Expand

Alibaba decides to add Russian merchants and markets to boost its sales.

Alibaba is looking to expand its market as globally as possible due to the recent news of a decline in China’s economy soon. It is opening its market to Russian merchants in order to increase sales and has already added Russian shops, such as Wikimart and Incity to its marketplace, named AliExpress.

Alibaba group will launch this facility on November 11. It said in an email, according to Business of Fashion, the market would consist of Russian goods in its online stores. Russia’s locals now are using internet shopping more than ever and this is a great opportunity for the e-commerce company to launch Russian products to capture the wide market. It has not evidently missed the opportunity.

The online Chinese business has 22 million monthly users in Russia. Its international online market was previously worth $1 billion in the first half quarter according to data insight. The online shopping convenience is trending rapidly in Russia because of the attractive packages, sales, and prices. The platforms that are used the most in the country are Alibaba Express and JD.com among many others.

The act of collaborating with Russian merchants to increase its sales in this market is the best step that the company has taken. Online sales from China have already had an increase of 50% in the beginning of 2015 due to the weakening Russian currency and recession contributing to the decrease of the purchasing power of the locals; hence, they are now turning their faces towards the online easy and affordable online market.

The business development director of Alibabaexpress commented, “In choosing partners, we focused on categories of good that are in high demand in Russia, and highlighted Russian brands and companies that manufacture products in Russia.”

Alibaba is already expanding to Europe and has appointed employees specifically for those tasks in France, Italy, and Germany. The Single’s Day event, from which it profited last year, is ahead and since the never-ending expansion, this time it might be even bigger than expected.

Without doubt, the online market will get affected from China’s economy since it is investing such a huge sum of money in its expansion worldwide and is now focused on market outside its hometown and rural markets domestically. It should keep this in focus for now. Many other companies existing in China are also vulnerable to the economic fluctuation, which bothers investors as well.

Alibaba stock is selling at $71.76 today.

Some Reasons To Invest In Qualcomm Inc.

Some of the reasons that compel financial investors to invest in the telecommunication company, Qualcomm Inc.

QUALCOMM Inc. (NASDAQ:QCOM), a telecommunication company and one of the finest mobile-chip manufacturing organization, suffered from a tough year. Samsung, which is the one of its returning customer, dropped its contract for the Snapdragon chips and wireless modems from its flagship Galaxy S6 smartphones for the in-house components. It also faces rising rivalry from comparatively inexpensive competitors, such as RockChip and MediaTek, which introduce many below-average devices in the emanating market.

Those challenges tend Qualcomm to cut down the high-end of its financial for the current year turnovers reported at $1.5 billion during the past quarter. It is not surprising that the company’s stock has fallen by 20% from the starting of the year. Nevertheless, after that fall, the stock seems to have a strong long-lasting financial investment for some reasons.

The technology licensing organization business, which put forward CDMA technologies to handset vendors all over the world, entitles the company to cut wholesale price of the smartphone from 3% to 5%.

The unit reported 86% of pre-tax earnings of the telecommunication company regarding its last quarter against only achieving a third of its turnovers. The unit has also been progressing at a high rate as compared to the Qualcomm CDMA Technologies chip-making business. The QTL unit’s turnover and pre-tax incomes both showed an upward trend of around 7% yearly throughout the last quarter against the fall of 22% in the QCT unit and 74% dive in pre-tax incomes.

Throughout the last 12 months, the organization paid out around 65% of its cash flow as dividends, compared to Intel’s FCF payout ratio of 41%. This indicates that both the chipmaking businesses have the potential to raise their dividends in the stock market.

Qualcomm performance during the last 12 years showed an elevation with consistency, the association has improved its dividends per year with the average of 22% during the last 4 years. It currently put forward a yearly dividend income of 3.5%, at the same time INTC yielded 3.7%. Both yields are extremely higher against the average of S&P 500 yield of 2.15%.

Currently, the company plans to transform the prime cellphone market by spreading its roots into the market of Internet of Things (IoT). According to IDC, it is expected that the market, which depends on everyday gadgets linked to each other, will grow more than 7.1 trillion by 2020. Many tech giants are striving after the IoT to dominate the tech market and stay ahead of competition.

Baird Equity Research Upgraded Bank Of America Corp Stock

Baird Equity Research suggests a Buy on Bank of America stock, while upgrading SunTrust to Neutral.

Bank of America Corp. stock has been raised to Outperform rating, similar to a Byrating at Baird Equity research firm. David A George, Evan Marks and Garrett A Holland, analysts at the sell-side firm revealed the rating upgrade in a research note with a title “From Euphoria to Panic in a Week.”

Investors are recommended to use the current sentiments and pullback in the stock market to shut their short position and buying BofA stocks. Bank of America’s tangible book-value’s discounted valuation shows that the stock has a sufficient margin of growth and safety in its book value. This is believed to increase the shares value in the non-existence of interest rate increase by Fed and until potential growth viewpoint improves.

The report discusses the much addressed problem of undervaluing the interest rate option. Shareholders are suggested to buy bank stocks, however the consensus on increase of increase rate is that it will going to be announced. This shows that the American bank’s net interest income might drop below the quarterly run rate of $10 billion. So as to battle the issue of low interest rate, the bank is looking to adopt cost cutting steps in the coming year and enhance its return. BofA, like other large banks that find it difficult to enhance their bottom line, has been on cost cutting path for quite a long time now.

As much as the regulatory capital is concerned, however it’s less than the bank’s peer, the experts believed that the bank’s shareholders should accept the deliberate pace of capital return. A stock price target of $18 on the company’s stock for the upcoming 12 to 18 months is expected. With the improvement in macro level environment, BofA is most likely to enhance its loan growth and increase its earnings by 25 cents per share, if the interest rate increases by almost 100 basis points.

In news, the research report also upgraded SunTrust Inc. stock to a Neutral. Because of improving loan growth and operating leverage, the bank is recommended to extend its valuation to approximately 13 times the fiscal year 2016 EPS.

Recently, Keefe, Bruyette & Woods upgraded Bank of America. Christopher Mustacio, an analyst now assigns an Outperform rating to the company’s stock with $20 price target.

According to the analysts polled by Bloomberg, 25 suggest a Buy, while only 3 recommend a Sell. The twelve month consensus stock price target stands at $19.36.

Tesla Needs To Strategize For Model X

Tesla Model deliveries postponed due to power failure.

Tesla Motors Inc.’s was all set to launch its much anticipated sports utility vehicle (SUV), namely Model X in the times to come. However, according to recent news, the company might not be able to make deliveries on time since the electric car giant’s automotive operations came to a sudden halt when a power failure was embraced at its factory situated in Fremont, California.

According to the news by CNBC, a crane working at the factory by mistake brought down the electricity wiring on Friday.  This electricity wiring was connected to the factory of Tesla Motors as suggested by their correspondent.  After the power failure occurred, Tesla told all its workers that do not work at their factories to carry on with their operations at home or from the company’s other office.

A tweet was published by the Fremont Police Department according to which, “Loud alarm sounding near Tesla is isolated to the Tesla Plant. FPD and @fFremontFire are not involved. Media - please contact @TeslaMotors.” However, no casualties were reported whatsoever.

PG&E Corporation which is a utility company situated in California worked tirelessly to overcome the power failure. The electricity breakdown occurred in the morning and was expected to be fixed by afternoon. The utility supply company also reassured about this news to popular web based platform Reuters where it claimed that some of PG&E Corporation’s client along with Tesla were affected by this incident.

Before this news surfaced in the industry, several analytical forms believed that Tesla will not be able to deliver its Mode; X on time. Mr. Elon Musk, the chief executive officer at Tesla Motors earlier claimed that its Model X is one the most difficult car to manufacture across the globe. Their website also claims that their manufacturing plants are “one of the world’s most advanced automotive factories.”

Apart from this, Tesla is also working on another one of a king SUV that is likely to be launched in September. But according to the recent news, the deliveries are likely to be postponed till October and will also have an impact on other deliveries committed for FY15.

According the results for the second quarter of FY15, the company had to revise its delivery mechanism since there were several complexities associated with Model X that will in return effect the productivity of Model S since both these cars are being manufactured at one plant only.

Cisco Plans To Invest $1 Billion In UK Technology Sector

Cisco will invest in United Kingdom, China, and France in the coming years.

Cisco Systems is all set to invest a massive $1 billion in the technology sector of the United Kingdom. The company wants to invest and do wonders in the booming Internet of Things market. The company announced on Thursday regarding its plans to invest in the country’s sector over the next 3 to 5 years that will actually help in boosting the information technology sector of the United Kingdom. This is the first and new investment after four long years where the networking giant vowed to spend $500 million for the same cause in UK.

According to Fortune, “Cisco will use part of its new investment to scout for potential acquisitions in the UK and has experience in purchasing UK-based companies. In 2013 it bought out Ubiquisys, a maker of a type of cellular technology known as a small cell, for $310 million.” Furthermore, the company also invested $5 billion in 2012 in a British company named NDS Group. NDS Group specialized in software for cable television.

The company sees the technology sector of UK as of high potential and hence wants to invest in it without any further ado. It is believed that the startups based in the United Kingdom, which will be working on technology and Internet of Things, will prove to be beneficial for Cisco in the coming times as it vows to spend $150 million in them to fasten growth.

Sources suggests, “The company was vague on what types of Internet-of-things companies or specific technologies it wants to target in the region, but it did mention that ‘smart city development’ is an area it wants to invest in.”

This will also enhance and push the business of Cisco as more and more municipalities will be buying the products of Cisco branded Internet of Things in software and hardware, which faces fierce competition from Oracle, IBM, and HP in the market.

The $1 billion investment plans come immediately after it announced plans to expand its investment in China. The China investment plans were of $10 million and it took Cisco only one month to go for new plans and invest in United Kingdom’s technology sector.

However, these two are not the only countries that the company will be investing in, in the coming times. The company said earlier this week that it also has plans to give $100 million to the France based startups. Cisco is all set to penetrate in the Internet of Things market, which seems to be the future.

JP Morgan All Set to Report Second Quarter Earnings Today

The article discusses the earnings whispers for JP Morgan, as the firm prepares to release its second-quarter results before the opening bell today.

JP Morgan Chase & Co. is scheduled to report its second quarter earnings for fiscal year 2015 today. Both the top line and bottom line estimates look positive for the bank, as it most likely to surpass the consensus forecasts for both these figures in this quarter.                                 

According to Earningswhispers.com says JP Morgan is most likely to post earnings of $1.50 per share for the quarter, surpassing the Street estimates by almost 0.05%. On the other hand, Estimize.com estimates average revenue of approximately $24.67 billion for the period, expecting the company to report more than the Street estimate of $241 million. The Street believes the bank to report a year over year decline of 8.98% in earnings and 3.63% year over year decline in sales for the second quarter.               

JP Morgan Chase & Co. reported earnings of $1.60 per share for first quarter of fiscal year 2015, beating the analysts’ expectation by nearly $309 million. During the last eight quarters, the bank was able to beat the Streets estimates seven times, and has surpassed the top line forecasts 5 times.

Majority of analysts are bullish on the stock of JP Morgan. Out of 40 analysts having coverage on JP Morgan stock, 29 gave it a Buy, while the remaining assigned a Hold. The analysts gave an average twelve month stock price target of $71.91, demonstrating an upside potential of 5.61% over the latest closing price.

According to some analysts, the company is expected to report earnings of $1.45 per share, a decline of 7.4% year over year. Earnings per share in the previous quarter were reported at $1.58. On the other hand, revenue is most likely to arrive t $24.42 billion, a decrease of almost 100 basis points. In the previous quarter, it was recorded at $24.06 billion. In the meantime, operating income is forecasted to be $9.02 billion.

JP Morgan’s consumer and community banking segment is most likely to generate robust results this period, however the investment banking segment is most likely to see revenue decline.

With an optimistic sentiment in the stock market, JP Morgan Chase & Co. stock was up 1.42% to $69.06 at market close on Tuesday July 14. As per Bloomberg terminal, 40 analysts covered the bank stock, out of which 29 suggested a Buy. The investment bank has 52 week low and high of $67.76 and $69.10, respectively. The company has $248.90 billion of market capitalization.