We're Back: S&P 500 Reaches All-Time High, Walmart, Home Depot Earnings, Oracle TikTok Play, Buffett Selling Stocks in 2020 - The Motley Fool | Canada News Media
Connect with us

Business

We're Back: S&P 500 Reaches All-Time High, Walmart, Home Depot Earnings, Oracle TikTok Play, Buffett Selling Stocks in 2020 – The Motley Fool

Published

 on


After standing on the threshold for almost a week, the S&P 500 Index (SNPINDEX:^SPX) is back at an all-time high. The index closed at 3389.78 on Aug. 18, up 7.8 points and surpassing the prior high, reached on Feb. 19. This marks the quickest bear-market recovery in history, with the index regaining all of its losses in 126 trading days. 

Leading the index today was Amazon.com Inc (NASDAQ:AMZN), gaining 4% after reports came out late yesterday that it was looking to acquire a minority stake in Rackspace, the cloud services company known for high-quality customer service that often partners with Amazon’s AWS offering. Amazon also just announced plans to invest $1.4 billion in hiring and new office space. In other tech news, Oracle (NYSE:ORCL) is said to be entering the bidding for TikTok’s North American and some other assets.  

On the earnings front, retail giants Walmart (NYSE:WMT) and Home Depot (NYSE:HD) released their most recent quarterly results, reporting huge same-store sales growth. In other news, a closer look at Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B) filings shows something surprising: Berkshire sold off stocks in 32 different companies in the first half of the year. 

Image source: Getty Images.

Index fully recovered, most stocks still down

Today marks a big statistical and emotional moment, with the S&P 500 Index regaining all of its losses since the February high. However, of the 505 stocks in the index, 284 are still below their prices at the beginning of the year. The influence of the tech giants at the top has buoyed the index. Amazon shares are up 72% year to date, while Apple has gained 56% and Microsoft shares are up 33%. The three combine for more than $5 trillion in market cap, pulling the index higher than smaller laggards pull it down. 

Is Oracle a player on TikTok bidding?

According to multiple news outlets, the database giant is supposedly engaged with ByteDance, the owner of TikTok, and is “strongly considering” making an offer to acquire the video-sharing app. Reports are that Oracle may offer as much as $50 billion to buy TikTok’s North America, Australia, and New Zealand businesses. 

Whether there’s any merit to the rumors remains to be seen, and there doesn’t seem to be any business reason for this deal to happen. A cynical observer might think that automatically puts Oracle in the lead position. After all, big tech companies — including Oracle — have overpaid before for boneheaded acquisitions that didn’t fit or create value. 

Walmart, Home Depot winning the coronavirus lockdown

Millions of Americans were stuck at home in the second quarter, and two of the country’s biggest retailers emerged as huge winners. Walmart reported same-store sales increased a massive 9.3%, with e-commerce sales almost doubling in the period. The mega-retailer, which offers nearly everything under one roof, benefited as a one-stop shop: Transactions fell 14%, but the average ticket increased 27% as people stocked up on items and made the most of every shopping visit. 

Home Depot’s sales surged even higher. The home improvement giant reported comps increased 25%, driving earnings per share up 27% as millions of homeowners took advantage of the lockdown to complete home improvement projects. 

Berkshire sold stocks in the first half of 2020

Berkshire Hathaway CEO Warren Buffett has long been bullish on American business, and his track record of success over the past half century shows us how rewarding this bullishness can be. However, Berkshire’s actions in the first half of 2020 didn’t exactly line up with Buffett’s usual sentiment. 

As my colleague Sean Williams recently reported, Berkshire SEC filings disclosed that the company sold shares in 32 separate companies in the first half of the year. This included completely selling its stake in nine companies, double-digit reductions in another five, and more modest trimming of its stake in another 18. 

Did Uncle Warren miss out on the coronavirus crash? In a very real way, yes that seems to have been the case. However, Buffett clearly still sees some opportunity. Another filing disclosed that more recently, Berkshire has bought even more Bank of America (NYSE:BAC) shares. BofA is now Berkshire’s second-biggest holding, worth more than $25 billion, and it controls about 12% of the bank’s shares. 

Has Buffett lost his touch? Don’t give up so quickly. Berkshire’s best investments during the Global Financial Crisis happened in 2010, more than a year after stocks reached bottom. 

Let’s block ads! (Why?)



Source link

Business

Telus prioritizing ‘most important customers,’ avoiding ‘unprofitable’ offers: CFO

Published

 on

 

Telus Corp. says it is avoiding offering “unprofitable” discounts as fierce competition in the Canadian telecommunications sector shows no sign of slowing down.

The company said Friday it had fewer net new customers during its third quarter compared with the same time last year, as it copes with increasingly “aggressive marketing and promotional pricing” that is prompting more customers to switch providers.

Telus said it added 347,000 net new customers, down around 14.5 per cent compared with last year. The figure includes 130,000 mobile phone subscribers and 34,000 internet customers, down 30,000 and 3,000, respectively, year-over-year.

The company reported its mobile phone churn rate — a metric measuring subscribers who cancelled their services — was 1.09 per cent in the third quarter, up from 1.03 per cent in the third quarter of 2023. That included a postpaid mobile phone churn rate of 0.90 per cent in its latest quarter.

Telus said its focus is on customer retention through its “industry-leading service and network quality, along with successful promotions and bundled offerings.”

“The customers we have are the most important customers we can get,” said chief financial officer Doug French in an interview.

“We’ve, again, just continued to focus on what matters most to our customers, from a product and customer service perspective, while not loading unprofitable customers.”

Meanwhile, Telus reported its net income attributable to common shares more than doubled during its third quarter.

The telecommunications company said it earned $280 million, up 105.9 per cent from the same three-month period in 2023. Earnings per diluted share for the quarter ended Sept. 30 was 19 cents compared with nine cents a year earlier.

It reported adjusted net income was $413 million, up 10.7 per cent year-over-year from $373 million in the same quarter last year. Operating revenue and other income for the quarter was $5.1 billion, up 1.8 per cent from the previous year.

Mobile phone average revenue per user was $58.85 in the third quarter, a decrease of $2.09 or 3.4 per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in overage and roaming revenues.

It said customers are increasingly adopting unlimited data and Canada-U.S. plans which provide higher and more stable ARPU on a monthly basis.

“In a tough operating environment and relative to peers, we view Q3 results that were in line to slightly better than forecast as the best of the bunch,” said RBC analyst Drew McReynolds in a note.

Scotiabank analyst Maher Yaghi added that “the telecom industry in Canada remains very challenging for all players, however, Telus has been able to face these pressures” and still deliver growth.

The Big 3 telecom providers — which also include Rogers Communications Inc. and BCE Inc. — have frequently stressed that the market has grown more competitive in recent years, especially after the closing of Quebecor Inc.’s purchase of Freedom Mobile in April 2023.

Hailed as a fourth national carrier, Quebecor has invested in enhancements to Freedom’s network while offering more affordable plans as part of a set of commitments it was mandated by Ottawa to agree to.

The cost of telephone services in September was down eight per cent compared with a year earlier, according to Statistics Canada’s most recent inflation report last month.

“I think competition has been and continues to be, I’d say, quite intense in Canada, and we’ve obviously had to just manage our business the way we see fit,” said French.

Asked how long that environment could last, he said that’s out of Telus’ hands.

“What I can control, though, is how we go to market and how we lead with our products,” he said.

“I think the conditions within the market will have to adjust accordingly over time. We’ve continued to focus on digitization, continued to bring our cost structure down to compete, irrespective of the price and the current market conditions.”

Still, Canada’s telecom regulator continues to warn providers about customers facing more charges on their cellphone and internet bills.

On Tuesday, CRTC vice-president of consumer, analytics and strategy Scott Hutton called on providers to ensure they clearly inform their customers of charges such as early cancellation fees.

That followed statements from the regulator in recent weeks cautioning against rising international roaming fees and “surprise” price increases being found on their bills.

Hutton said the CRTC plans to launch public consultations in the coming weeks that will focus “on ensuring that information is clear and consistent, making it easier to compare offers and switch services or providers.”

“The CRTC is concerned with recent trends, which suggest that Canadians may not be benefiting from the full protections of our codes,” he said.

“We will continue to monitor developments and will take further action if our codes are not being followed.”

French said any initiative to boost transparency is a step in the right direction.

“I can’t say we are perfect across the board, but what I can say is we are absolutely taking it under consideration and trying to be the best at communicating with our customers,” he said.

“I think everyone looking in the mirror would say there’s room for improvement.”

This report by The Canadian Press was first published Nov. 8, 2024.

Companies in this story: (TSX:T)

Source link

Continue Reading

Business

TC Energy cuts cost estimate for Southeast Gateway pipeline project in Mexico

Published

 on

 

CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.

It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.

The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.

Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.

TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.

The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:TRP)

The Canadian Press. All rights reserved.

Source link

Continue Reading

Business

BCE reports Q3 loss on asset impairment charge, cuts revenue guidance

Published

 on

 

BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.

The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.

On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.

“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.

“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”

Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.

BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.

The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.

BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.

It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.

The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”

Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:BCE)

The Canadian Press. All rights reserved.

Source link

Continue Reading

Trending

Exit mobile version