BloggingStocks

Time Warner (TWX) hits new low with ad and AOL concerns

Douglas McIntyre — 2008-10-10T12:40:00+00:00

Filed under: Forecasts, Industry, Microsoft (MSFT), Yahoo! (YHOO), Time Warner (TWX), Time Warner Cable (TWC)

Time Warner (NYSE: TWX) hit a new 52-week low today at $9.03. Until recently, it has performed better than most of the other media conglomerates, but it now faces two difficult questions.

Before current CEO Jeff Bewkes took over, it was assumed that Time Warner Cable (NYSE: TWC) would be spun out. Bewkes managed to get over $9 billion from the transaction. That may have been priced into the shares when he stepped into the top job. The other major assumption of shareholders was that AOL would be repaired or sold. The internet unit has been divided into two pieces. The ISP operations will probably be sold to another internet service company. The fate of AOL remains unknown. There are rumors that it could be sold to Yahoo! (NASDAQ: YHOO) or Microsoft (NASDAQ: MSFT).

Because internet display advertising is facing a downturn, sales at AOL will almost certainly suffer in the fourth quarter and into 2009. If Yahoo! is a reasonable proxy, the fact that it has lost half of its market cap this year and has been downgraded by several analysts cannot be good news for AOL.

Advertising weakness is bound to catch up to Time Warner's magazine unit. Print advertising may never recover entirely if the newspaper industry is any guide. Analysts have frequently said that the magazine unit should be sold. It is no longer a growth operation.

TWX cable units, like CNN, which rely on TV ads, are also certain to face an unpleasant if not vicious environment heading into the winter.

Investors in Time Warner are troubled for a simple reason: The company still looks too much like it did last year.

Douglas A. McIntyre is an editor at 247wallst.com.

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Option Update: Time Warner volatility up on corporate execution expectations

Paul Foster — 2008-07-16T14:52:00+00:00

Filed under: Microsoft (MSFT), Time Warner (TWX), Options, Time Warner Cable (TWC)

Time Warner (NYSE: TWX) is recently up 53 cents to $14.45.

The WSJ reported Microsoft (NASDAQ: MSFT) and TWX's AOL unit are in advance discussions on a possible tie up.

TWX is expected to report Q2 EPS on August 6. On May 21, 2007 TWX declared a one-time dividend of $10.9 billion to its stockholders, payable just prior to separation of Time Warner Cable (NYSE: TWC); TWX will receive $9.25 billion of Time Warner Cable's dividend.

TWX call option volume of 25,158 contracts compares to put volume of 20,636 contracts. TWX August option implied volatility of 43 is above its 26-week average of 35 according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

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Will GE get out of hot water by selling NBC to Time Warner?

Douglas McIntyre — 2008-07-10T12:10:00+00:00

Filed under: Deals, Rumors, Industry, General Electric (GE), Time Warner (TWX), CBS Corp 'B' (CBS), Time Warner Cable (TWC)

General Electric (NYSE:GE), which reports earnings tomorrow, has indicated that it may spin-off its weakest divisions -- the firm's consumer and industrial units. No one cared, and the stock did not move. The action would not be enough, nearly enough to pull GE away from its multi-year lows.

What investors would really like to see is GE broken into little pieces, the smaller the better. The only growing and hardy business that GE has now is its huge infrastructure operation. It would make a nice stand-alone company.

The unit that investors most want to see GE kick out the door is NBC Universal, a mismatch with all of GE's other businesses. In the last quarter, it had revenue of $3.6 billion and segment operating profits of $712 million. It is profitable, but not growing.

There is speculation that NBC Universal may have a very interested buyer in Time Warner (NYSE:TWX), which is about to get a load of cash from its own spin-off of Time Warner Cable (NYSE:TWC). The New York Post writes that GE CEO Jeff Immelt may be "interested in exploring a merger or spin-off - with Time Warner and Liberty Media mentioned most often as the likely suitors."

A deal which combines a TV network and another studio with Time Warner is not so far-fetched. NBCU has a number of cable channels including the recently acquired cable and online behemoth, The Weather Channel. Time Warner tried to buy that all on its own. The $3.5 billion price was too high. TWX has it own cable powerhouse, the crown jewel of which is CNN.

Time Warner could save a fair amount of money by putting together two studios, which would allow it to increase earnings by tearing costs out of NBCU.

The financial portion of the transaction would be a big pill to swallow for TWX, but it is not beyond the media company's capacity. CBS (NYSE:CBS), which has revenue comparable to NBCU, has a market cap of about $12 billion. That means Time Warner would probably have to pay $15 billion to get GE's entertainment unit.

Shareholders in Time Warner want to see management step up and improve the company's prospects. There are not many big media deals to be had these days.

Sometimes needing something is just as important as whether owning it makes sense.

Douglas A. McIntyre is an editor at 247wallst.com.

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Time Warner Cable to issue debt to pay dividend to parent

Jon Ogg — 2008-06-16T13:30:00+00:00

Filed under: Time Warner (TWX), Time Warner Cable (TWC)

Time Warner Cable Inc. (NYSE: TWC) has filed a shelf registration with the Securities and Exchange Commission and has commenced an underwritten public offering of debt securities with maturities ranging from 5 to 30 years. Unfortunately, the size was not listed in the S-3 filing this morning.

The net proceeds from the issuance of the debt securities are expected to be used to finance a one-time dividend to stockholders of Time Warner Cable to be paid just prior to the previously announced spin-off of Time Warner Cable from its parent company Time Warner Inc. (NYSE: TWX).

What is interesting is that this leaves an out in case market conditions or other conditions would keep that spin-off from happening. If the separation is not consummated and the special dividend is not paid, Time Warner Cable says it will use the proceeds for general corporate purposes. Those general purposes are the traditional terminology that is cookie cutter vernacular: additions to working capital, capital expenditures, repayment of debt, the financing of possible acquisitions and investments or stock repurchases.

Time Warner Cable Inc. is the issuer and these debt instruments that are to be guaranteed by its subsidiaries TW NY Cable Holding Inc. and Time Warner Entertainment Company, L.P.

While the size was not listed, this is likely going to be a very large underwriting if you see how many underwriters there are for a mere debt offering. Banc of America Securities, BNP Paribas Securities, Greenwich Capital Markets, Morgan Stanley, and Wachovia Capital Markets, LLC are the listed underwriters for this debt offering.

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Companies that vanished: Adelphia

Amey Stone — 2008-06-15T14:40:00+00:00

Filed under: Comcast Cl'A' (CMCSA), Time Warner Cable (TWC)

This post is part of a series on some of the most memorable companies that have disappeared.

I can't say I had much personal experience with Adelphia, which was the fifth largest cable company in the country when it filed for bankruptcy in 2002. But I did follow the case of the Rigas' family with interest. Dad and founder John and son Timothy Rigas ended up going to jail after treating this huge public company like their own personal candy store.

Founded in 1952 in Coudersport, Penn., Adelphia's name came from the Greek word for brother. The company went public in 1986 and grew by acquisition -- buying up smaller cable providers.

The company went bankrupt in 2002 after disclosing $2.3 billion in debt that was kept off the balance sheet. Federal prosecutors charged the Rigases and other officers of looting the company of an estimated $100 million, much of it spent on ridiculous excess -- like spending $6,000 to have Christmas trees flown in to New York.

Both Rigas men were found guilty and in 2007 started serving time in a Federal prison in Raleigh, North Carolina.

Time Warner Cable (NYSE: TWC) and Comcast (NASDAQ: CMCSA) bought up Adelphia's cable business in 2006, splitting up the customers by region.
Let us know in the comments what you miss about Adelphia. And be sure to check out other Companies That Have Vanished.

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Time Warner walks on The Weather Channel

Douglas McIntyre — 2008-06-14T15:40:00+00:00

Filed under: Deals, Time Warner (TWX), Time Warner Cable (TWC)

Depending on who is doing the measuring, The Weather Channel is one of the most widely watched 24-hour cable networks. Weather.com is among the top 15 or 20 most visited websites in the U.S. Since there are very few media properties of this size on the block, they are especially valuable.

Landmark, the owner of The Weather Channel, has put it on the block. It wanted $5 billion. The rumors are that it will get $3.5 billion on a good day. The last two companies kicking the tires were Time Warner (NYSE: TWX) and NBC Universal. TWX has apparently dropped out.

Although the media conglomerate has over $9 billion in money coming in as it finishes its spin-off of Time Warner Cable (NYSE: TWC), management cannot afford to be viewed as overanxious. Paying too much for a large asset would not make the new era of shareholder value under recently appointed CEO Jeff Bewkes look like it is off to a terribly good start.

According to The Wall Street Journal (subscription required), "Time Warner withdrew after Landmark told the media company it needed more time to make a decision." That probably means the seller is holding out for more cash.

For Time Warner, it is a shame. Its cable networks, CNN and Turner, do particularly well. Putting The Weather Channel with them would have built that business. Online, TWX has big properties like AOL and CNN.com, making Weather.com a good marriage.

It all made sense, except the price.

Douglas A. McIntyre is an editor at 247wallst.com.

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Analyst initiations: DSCM, SCMR and AFL

Eric Buscemi — 2008-06-13T11:14:00+00:00

Filed under: Analyst reports, AFLAC Inc (AFL), Analyst initiations, Time Warner Cable (TWC)

MOST NOTEWORTHY: Drugstore.com, Sycamore and Aflac were today's noteworthy initiations:

Kaufman Bros. believes Drugstore.com (NASDAQ: DSCM) is well-positioned for long-term growth and significant margin expansion, led by share gains in the OTC and prestige beauty verticals. The firm started shares with a Buy rating and $3.25 target.
Merriman initiated Sycamore (NASDAQ: SCMR) with a Neutral rating and prefers to be on the sidelines given the company's concentrated customer base and lack of clarity on strategic priorities and ongoing business operations.
SunTrust Robinson expects the Aflac's (NYSE: AFL) cancer insurance policies in Japan to benefit from concerns about the national health system. Shares were assumed with a Buy rating and $79 target.

OTHER INITIATIONS:

Caris initiated Mylan (NYSE: MYL) with a Buy rating and $18 target.
NetSuite (NYSE: N) was assumed with a Hold rating and $22 target at Deutsche Bank.
Stanford initiated Time Warner (NYSE: TWX) with a Buy rating and $20 target.

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Service so bad, city of Los Angeles sues Time Warner Cable (TWC)

Carol Vinzant — 2008-06-09T13:30:00+00:00

Filed under: Television, Time Warner Cable (TWC)

For every person who had to wait forever for Time Warner Cable, Inc. (NYSE: TWC) to pick up the phone, for every customer who had to slog through an automated voice menu, then stew waiting to talk to a person, for every family that went days without TV or internet, Los Angeles City Attorney Rocky Delgadillo struck a blow Friday. On behalf of the city of Los Angeles, Delgadillo sued the top cable provider for southern California, saying its service was so bad it constituted fraud and deceptive advertising.

The city wants $2,500 for each instance, double if the victim was old or disabled. Part of the problem in Los Angeles stemmed from the company's complicated task of absorbing Comcast and Adelphia customers, not everyday business. Consumers had filed their own civil suit a while back.

Time Warner Cable stock dropped $1.23, or about 4%, Friday on somewhat heavy trading. The damages could add up to potentially millions of dollars. Or it could be one of those lame settlements that give customers useless coupons.

The direct impact of the civil suit isn't as much of a big deal -- yet -- as the broader implications. What if other cities or customers sue? How is this suit going to influence the opinion of someone who's deciding between Time Warner and Dish Network or DirecTV? Between Roadrunner and wireless broadband? For a long time, cable providers could offer lousy service because there was basically no competition. Now, they have to behave better or lose customers. Now that could be real money.

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Time Warner Cable testing tiered and metered internet access

Jon Ogg — 2008-06-03T18:28:00+00:00

Filed under: Google (GOOG), Time Warner Cable (TWC)

There was an interesting read over at Slashdot.org today. In a story last night from the Associated Press, it looks like Time Warner Cable Inc. (NYSE: TWC) may be testing out a web metering service for its internet access.

The company is testing a service with new Time Warner Cable Internet subscribers in Beaumont, Texas where customers will have a monthly allowance for the amount of data with a $1.00 charge per gigabyte. The company had already warned back in January that it was going to test rates and test some metered and tiered internet access services, so this isn't likely to be a bomb dropping into the school yard.

Slower services of 768 kbps with a 5-gigabyte monthly allowance are going to run $29.95, while their fastest and larger service with fast downloads at up to 15 megabits per second and a 40-gigabyte cap will run $54.90 per month.

Apparently 5% of its internet users are taking up half of the capacity on local cable lines.

For basic web users this is a non-starter. But for those who download videos and send out or access large files regularly, this could become a head scratcher as very few consumers have any real clue what their internet usage means in terms of bandwidth. It seems that Google Inc. (NASDAQ: GOOG) YouTube and all that free porn are going to end up costing you after all.

That's one way around net neutrality...

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5-star stocks in Buffett's portfolio, ways to boost your social security & best rewards cards - Today in Money 6/3

Allan Halprin — 2008-06-03T07:34:00+00:00

Filed under: Microsoft (MSFT), Yahoo! (YHOO), Ford Motor (F), General Motors (GM), Berkshire Hathaway (BRK.A), Johnson and Johnson (JNJ), Money and Finance Today, American Express (AXP), FedEx Corp (FDX), Lowe's Cos (LOW), United Parcel'B' (UPS), Toll Brothers (TOL), Kraft Foods'A' (KFT), Time Warner Cable (TWC), Lehman Br Holdings (LEH)

In the News:

· Bye-Bye Kinko's As FedEx Drops Its Name From Stores

· GM Seen Cutting Deeper as Recovery Is Sideswiped

· Ford CEO Says Shift to Small Cars Here to Stay

· Lehman Brothers Looks to Raise Up to $4 Billion

· Toll Brothers Has Hefty 2Q Loss That Is Even Worst Than Expected

· You May Start Getting Charged Extra for Excessive Web Use From Time Warner Cable

· Hyundai Motor Chairmans Jail Term Suspended Again

· New Documents Shed Light on Microsoft-Yahoo Saga

· Real-Time Stock Quotes Available for Free Online

5-Star Stocks in Warren Buffett's Portfolio
Morningstar examines the most watched portfolio in the world -- Berkshire Hathaway's. Among the five-star stocks in the Oracle of Omaha's portfolio are Amercian Express, CarMax, J&J, Lowe's, UPS, Wellpoint and Kraft Foods.
5-Star Stocks in the Berkshire Hathaway Portfolio - Morningstar

Secret Ways to Boost Your Social Security
These four strategies can add as much as $12,000 a year to your retirement income.
Secret Ways to Boost Your Social Security - Kiplinger.com

Coupon Clipping Made Easier
Thanks to high gas and grocery prices, coupon clipping is making a comeback. New technologies and services make coupon clipping more accessible for shoppers. They include coupon kiosks in stores, loaded loyalty cards and cellphone coupons to name a few.
5 New Ways to Clip Coupons - SmartMoney.com

Points Mania: Best Rewards Cards
To keep you coming back and spending more, supermarkets, drugstores, warehouse clubs, gas stations, book chains, and many other retailers are pushing rewards programs. Our key rings, wallets, and purses are so crammed with rewards cards these days that making even the simplest purchase can involve a frantic shuffle at checkout time. We tell you which card rewards-points programs are worthwhile and how to get the most from your spending.
ConsumerReports.org - Rewards cards, best cash-back cards

12 New 'Necessities' That Drain Your Cash
True essentials never really change -- food, water, shelter and clothing. However, modern life has created a host of "new necessities" that many people swear they cannot live without -- a daily latte, premium cable, a weekly manicure, a new leased automobile and cell phones for the family. Just because you want it doesn't mean you need it. Which modern necessities are luxuries you can live without?
12 new necessities that drain your cash -Bankrate.com

Get 100 Miles Per Gallon -- Cheap!
Imagine driving a vehicle that gets 115 miles per gallon that can be parked almost anywhere and costs about $2,000. No, we're not talking about some micro car available only to the masses in India, but something a scooter that is drawing a lot of interest from people who live in crowded cities and students on college campuses.
100 miles per gallon -- cheap! - Bankrate.com

What's Wrong With Plain Water?
Is enhanced-water really better for you than regular tap water? Consumer Reports gets to the bottom of this debate.
Enhanced water wars - Consumer Reports

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Time Warner boots cable, grabs dividend

Jon Ogg — 2008-05-21T11:25:00+00:00

Filed under: Time Warner (TWX), Time Warner Cable (TWC)

Time Warner Inc. (NYSE: TWX) and Time Warner Cable Inc. (NYSE: TWC) have finally announced approval of an agreement that will result in the complete legal and structural separation of the two companies.

Here are the guts of the deal:

Time Warner exchanges its 12.4% interest in TW NY Cable Holding Inc., a subsidiary of Time Warner Cable, for 80 million newly issued shares of Time Warner Cable's Class A common stock, increasing Time Warner's ownership stake in Time Warner Cable's common stock from 84% to 85.2%;
Time Warner Cable declares a one-time dividend of $10.27 per share for a total of about $10.9 billion payable immediately prior to completion of the separation;
Time Warner receives $9.25 billion from this dividend;
Time Warner Cable expects to fund the one-time dividend through its existing revolving credit facility and $9 billion from a new, committed two-year bridge term financing from a syndicate of banks;
Time Warner converts its Time Warner Cable Class B common shares (each Class B common share has the voting power equivalent to 10 Class A common shares) into Time Warner Cable common shares on a one-for-one basis in a recapitalization that results in Time Warner Cable having one class of common stock;
Time Warner will distribute its entire ownership stake in Time Warner Cable to Time Warner stockholders in a tax-efficient manner; the exact form of the distribution will be determined shortly before the closing of the transaction, based on market conditions.

This should be the start of that value unlock, and this will also clarify the balance sheets of both companies.

In a recent newsletter article, I generated an $18 scenario with a $20 target on a slightly enhanced basis. In early to mid 2009 as the economic slowdown should have been worked through, I even see a $22 to $24 upside scenario.

Jon Ogg is the editor of 24/7 Wall St.'s Special Situation newsletter.

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Home Depot vs. Lowe's, reverse mortgage come-ons & high cost of green dream - Today in Money 5/21

Allan Halprin — 2008-05-21T08:19:00+00:00

Filed under: Microsoft (MSFT), Time Warner (TWX), Home Depot (HD), Target Corp. (TGT), Money and Finance Today, Lowe's Cos (LOW), Merck and Co (MRK), Intuit Inc (INTU), Time Warner Cable (TWC)

In the News:

· Oil Prices Rise Above $130/Barrel for First Time

· Strong Demand Boosts Hewlett-Packard Profits

· Time Warner, Time Warner Cable Agree to Separate

· Intuit Earnings Top Estimates

· Target is a Victim of Its Own Success

· Merck Agrees to $58M Settlement Over Vioxx Ads

· Barnes & Noble May Bid to Buy Borders Books

· 'Wall Street Journal' Gets New Managing Editor

· Honda to Sell New Gas-Electric Hybrid in 2009

· Paper Money Discriminating Against Blind?

· Cell Phone Users May Get Break on Fees

· Only in NYC: $175 Hamburger Sold at Restaurant

· Hungarian Student Hurls Eggs at Microsoft CEO Steve Ballmer

Home Depot vs. Lowe's
One is expanding rapidly and the other is shutting stores. Which strategy will work?
Fast-Growing Lowe's May Have Edge Over Home Depot - SmartMoney.com
Also: Home Depot and Lowe's Get Hammered

Reverse Mortgages: Beware the Come-Ons
The loans can help you tap the equity in your house. Just don't get tripped up by greedy salespeople.
Reverse mortgages: Beware the come-ons - MONEY

The High Cost of a Green Dream
It seemed like a fantasy project to renovate their new home in an environmentally sensitive way. Reality is costing them more green than they could have imagined.
The high cost of a green dream - CNNmoney

Diners Will See More Creative Menus as Costs Squeeze Restaurants
On the bill of fare are dishes that swap beef and chicken for pork, offer beef medallions rather than steaks and squeeze in surcharges for bread and butter. Chew on this: Consumers may not recognize their favorite restaurant's menus as the eateries take creative steps to cope with rising commodity and energy prices without compromising the appetizing nature of their offerings.
Diners will see more-creative menus as costs squeeze eateries - MarketWatch

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Before the bell: Futures lower as oil moves higher yet

Melly Alazraki — 2008-05-21T07:47:00+00:00

Filed under: Before the bell, Earnings reports, Deals, Hewlett-Packard (HPQ), Time Warner (TWX), Market matters, Staples Inc (SPLS), Economic data, Time Warner Cable (TWC), Oil

Stock futures were somewhat lower early Wednesday morning as as oil prices managed to set yet another record high, going through yet another milestone and move above $130 a barrel.

U.S. stocks plunged Tuesday, after a Labor Department report showed wholesale inflation in April rose more than forecast and as the price of oil continued to rise following a prediction from T. Boone Pickens of $150 oil. The Dow industrials fell 199 points, the S&P 500 dropped 13 points and the Nasdaq Composite dropped 23 points.

At 10:30 a.m. today, weekly crude inventories data will be released. In the meanwhile, Light, sweet crude for July delivery reached a trading record of $130.47 a barrel. It has been supply concern, rather than a lower dollar, that has been moving oil lately.

Also today, the minutes of the latest Federal Reserve meeting will be released at 2:00 pm EDT. No doubt investors will scrutinize the minutes, searching for more clues on the Fed's next step, which would hope help strengthen the dollar somewhat.

On the corporate side of things, Time Warner (NYSE: TWX) shares are rising in premarket trading after the media conglomerate said that its and Time Warner Cable Inc. (NYSE: TWC)'s boards have approved the companies' legal separation, and that Time Warner will get $9.25 billion of the hefty $10.9 billion one-time dividend to shareholders TWC is paying, amounting to $10.27 per share of TWX.

Hewlett-Packard Co. (NYSE: HPQ) reported late Tuesday. It seems that rising international demand helped the results, but investors remained concerned about the company's exposure to the U.S. economy and worried how the company plans to digest and integrate newly acquired Electronic Data Systems.

Meanwhile Staples (NASDAQ: SPLS) may find it more troublesome to bid for Netherlands-based Corporate Express after the Dutch firm said its is buying Lyreco of France for around $2.7 billion.

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Before the bell: INTC, LEH, COP, GM, GS, BRK.a ...

Melly Alazraki — 2008-05-19T08:20:00+00:00

Filed under: Before the bell, Analyst reports, Analyst upgrades and downgrades, Deals, Google (GOOG), Apple Inc (AAPL), Intel (INTC), General Motors (GM), Berkshire Hathaway (BRK.A), Employees, Comcast Cl'A' (CMCSA), ConocoPhillips (COP), Goldman Sachs Group (GS), Morgan Stanley (MS), Time Warner Cable (TWC), Lehman Br Holdings (LEH)

Before the bell: Stock futures mixed as Microsoft resumes talks with Yahoo

The New York Times Bits blog says that according to several label executives, Apple Inc. (NASDAQ: AAPL) has approached some of the major music labels to try to expand the variety of ringtones and other musical features for the iPhone. The negotiations are very active right now and a final deal has not been set, but will likely be during the summer, but after June 9. Ringtones are quite a profitable market, and Apple wanting to have ringtones from major label makes total sense. Apple also wants to offer Answer Tones for the iPhone.

Intel Corp (NASDAQ: INTC) said Monday its venture capital arm has invested 50 million ringgit ($16 million) in Malaysia's Green Packet Berhad to help develop the country's first nationwide high-speed WiMAX network. Already earlier this month, Intel Capital along with Google Inc (NASDAQ: GOOG), Comcast Corp (NASDAQ: CMCSA), Time Warner Cable Inc (NYSE: TWC), and Bright House Networks agreed to invest $3.2 billion into a new company to speed up deployment of the next-generation mobile WiMAX network. But that's not all. Intel Capital also expects to close half a dozen deals in India this year, its regional head said on Monday.

Warren Buffett is apparently on the prowl for another acquisition. The Oracle of Omaha has begun his European tour Monday, looking for possible acquisitions for his Berkshire Hathaway Inc. (NYSE: BRK.A).

General Motors Corp. (NYSE: GM) shares are up over 1% after a tentative accord was reached May 16 with the United Auto Workers. American Axle & Manufacturing Holdings Inc. (NYSE: AXL) workers start voting Monday on a proposed contract that also calls for wage cuts and buyouts at five American Axle plants in New York and Michigan. This could end the 83-day strike that has slowed output at GM, the partsmaker's biggest customer.
State-run Saudi Arabian Oil Co., or Saudi Aramco, and ConocoPhillips (NYSE: COP) said Friday they have approved continued funding for the development of a refinery that will process 400,000 barrel-per-day of crude supplied by Saudi Aramco in Saudi Arabia's Red Sea city of Yanbu.

Citigroup slashed its earnings outlook for Goldman Sachs Group Inc (NYSE: GS), Morgan Stanley (NYSE: MS) and Lehman Brothers Holdings Inc (NYSE: LEH), which also Friday announced it is cutting 5%, or 1,400 people, of its staff. Citi said tough operating environment will be the culprit of lower earnings and the analyst expects significant asset sales.

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TWX Chairman Parsons says likely to step down; Next job NYC mayor?

Jon Ogg — 2008-05-16T12:38:00+00:00

Filed under: Time Warner (TWX), Time Warner Cable (TWC)

As soon as Richard Parsons gave up his CEO role in January, remaining chairman of Time Warner Inc. (NYSE: TWX), the smart money bet that his tenure would be short-lived. After all, he had turned over the fun part of the job to Jeffrey Bewkes.

Today, at the annual shareholder meeting, Parsons said he would likely give up his role as chairman after this year. This will mean Bewkes gets the chairman title affixed to his CEO tag. In fact, his contract stipulates being able to become chairman.

This is more than a title change. It will consolidate the decision-making power and the public's perception of who is in charge with Bewkes. It may even allow Bewkes to more expeditiously get Time Warner Cable Inc. (NYSE: TWC) out of the structure.

For Parsons, it will mean a fresh start. He has long been thought of as a candidate for Mayor in New York City. Handing the chairmanship of Time Warner over to Bewkes would allow Parsons to pursue that.

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Analyst upgrades: Comcast, Time Warner Cable, YRC Worldwide, Syniverse

Eric Buscemi — 2008-05-07T12:12:00+00:00

Filed under: Analyst reports, Analyst upgrades and downgrades, Comcast Cl'A' (CMCSA), NYSE Euronext (NYX), YRC Worldwide (YRCW), Time Warner Cable (TWC)

MOST NOTEWORTHY: Comcast, Time Warner Cable, YRC Worldwide and Syniverse were today's noteworthy upgrades:

Soleil upgraded shares of Comcast (NASDAQ: CMCSA) and Time Warner Cable (NYSE: TWC) to Buy from Hold on improving fundamentals, as they believe the economic stimulus package should drive consumer demand in 2H08.
Stephens upgraded shares of YRC Worldwide (NASDAQ: YRCW) to Overweight from Underweight as they believe management is making meaningful changes.
Syniverse (NYSE: SVR) was raised to Overweight from Neutral at JP Morgan. The firm upgraded shares based on accelerating organic growth from consumer wireless data usage.

OTHER UPGRADES:

Deutsche Bank upgraded NYSE Euronext (NYSE: NYX) to Buy from Hold.
VASCO Data Security (NASDAQ: VDSI) was upgraded to Buy from Hold at Jefferies.
Goldman upgraded Lukoil (OTC: LUKOY) to Buy from Neutral.

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Before the bell: Futures lower ahead of data

Melly Alazraki — 2008-05-07T07:48:00+00:00

Filed under: Before the bell, Earnings reports, Deals, Google (GOOG), Cisco Systems (CSCO), Intel (INTC), Market matters, Walt Disney (DIS), Sprint Nextel Corp (S), Comcast Cl'A' (CMCSA), Economic data, Time Warner Cable (TWC), Oil, Housing

U.S. stock futures were lower early Wednesday as investors, worried about inflation, await data on pending home sales and labor costs. Earnings news in focus this morning comes from tech bellwether Cisco Systems, which gave a cautious outlook, and from Walt Disney, which reported good results.

Despite starting the day on a down note, as oil futures remained high, U.S. stocks closed higher on Tuesday, mostly due to some reassuring comments made on a Fannie Mae (NYSE: FNM) conference call. The Dow industrials ended up 51 points, or 0.40%, the S&P 500 rose 10 points, or 0.77%, and the Nasdaq Composite finished 19 points, or 0.78%, higher.

Today investors will finally have some data to sink in their teeth. First quarter labor productivity and unit costs is out at 8:30 a.m. EDT. Economists expect productivity to rise 1.5% in the first quarter, but for unit labor costs to climb as well.

Also on the docket today are March pending home sales data to be released at 10:00 a.m. and which probably fell another 1%.

After that, weekly crude inventories are scheduled to be reported. Crude futures have held up near $122 a barrel despite the dollar advancing against the yen and the euro.

There are many companies in focus this morning too. Cisco Systems (NASDAQ: CSCO) reported sales and earnings that exceeded analysts' expectations after the close Monday, but gave a sales guidance that was somewhat conservative.

Walt Disney (NYSE: DIS) also reported quarterly results after the market close Tuesday that also beat expectations. Interestingly, it seems that of all companies, the entertainment giant isn't getting hit by the economic slowdown as other companies do. Disney shares were up 2.3% in premarket trading.

And in deal news, Sprint Nextel (NYSE: S) and Clearwire (NASDAQ: CLWR) announced Wednesday the formation of a joint venture for the high-speed wireless network WiMax to create a $14.55 billion communications company in which Sprint will hold a 51% stake. The new company, to be named Clearwire, will receive a $3.2 billion investment from Intel Corp. (NASDAQ: INTC), Google Inc. (NASDAQ: GOOG), Comcast Corp. (NASDAQ: CMCSA), Time Warner Cable Inc. (NYSE: TWC) and Brighthouse Networks. Sprint shares are up over 7.7% in premarket trading, CLWR nearly 14.5%.

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Earnings highlights: Exxon, GM, Time Warner, Starbucks, P&G, ADM and others

Trey Thoelcke — 2008-05-03T10:10:00+00:00

Filed under: Earnings reports, Time Warner (TWX), Starbucks (SBUX), General Motors (GM), Exxon Mobil (XOM), Archer-Daniels-Midland (ADM), Chesapeake Energy (CHK), Kellogg Co (K), Colgate-Palmolive (CL), Corning Inc (GLW), Procter and Gamble (PG), Under Armour'A' (UA), Duke Energy (DUK), Burger King Hldgs (BKC), Valero Energy (VLO), Kraft Foods'A' (KFT), Time Warner Cable (TWC), Garmin Ltd (GRMN)

Here are some highlights from this past week's earnings coverage from BloggingStocks:

Archer Daniels Midland Co. (NYSE: ADM) Q3 profits soared, beating analysts' expectations.
Buffalo Wild Wings Inc. (NASDAQ: BWLD) strong Q1 results met analysts' expectations.
Burger King Holdings Inc. (NYSE: BKC) reported solid Q3 results that beat Wall Street estimates.
Chesapeake Energy Corp. (NYSE: CHK) beat expectations for the first quarter, sending shares up.
Colgate-Palmolive Co. (NYSE: CL) posted better-than-expected Q1 results on the weak dollar.
Corning Inc. (NYSE: GLW) beat earnings expectations and raised its guidance.
Corn Products International (NYSE: CPO) posted record sales for the ninth consecutive quarter.
Duke Energy Corp. (NYSE: DUK) Q1 profits met expectations but revenues beat them.
ExxonMobil Corp. (NYSE: XOM) missed Q1 expectations due to narrower margins.
Garmin Ltd. (NYSE: GRMN) reported lower-than-expected earnings due to slowed demand.
General Motors Corp. (NYSE: GM) posted a smaller-than-expected loss for the first quarter.
Herbalife Ltd. (NASDAQ: HLF) posted Q1 results and announced the resignation of the president and COO.
Kellogg Co. (NYSE: K) beat Q1 expectations and announced a 10% dividend increase.
Kraft Foods Inc. (NYSE: KFT) Q1 profits declined but beat analysts' expectations.
Procter & Gamble Co. (NYSE: PG) reported better-than-expected Q1 results and raised its 2008 outlook.

Starbucks Corp. (NASDAQ: SBUX) posted weak Q2 earnings in line with Wall Street expectations.
Time Warner Cable Inc. (NYSE: TWC) beat Q1 expectations and reaffirmed its guidance.
Time Warner Inc. (NYSE: TWX) posted solid Q1 results and announced a spin-off of TWC.
Under Armour Inc. (NYSE: UA) beat Q1 expectations but lowered its full-year outlook.
Valero Energy Corp. (NYSE: VLO) blew past Q1 EPS expectations despite despite profits plunging 77%.

Also, Jim Cramer lauds Procter & Gamble for its success in these tough times and Colgate-Palmolive for bouncing back after taking a hit. And Time Warner investors may have been looking for more than they got in the quarterly report.

Upcoming results to watch for include Anadarko Petroleum (NYSE: APC), Cisco Systems (NASDAQ: CSCO), Fannie Mae (NYSE: FNM), Molson Coors (NYSE: TAP), Walt Disney Company (NYSE: DIS), and American International Group (NYSE: AIG).

Visit AOL Money & Finance for more earnings coverage.

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Time Warner investors demand an AOL deal

Jonathan Berr — 2008-04-30T13:12:00+00:00

Filed under: Earnings reports, Competitive strategy, Yahoo! (YHOO), Time Warner (TWX), Time Warner Cable (TWC)

Investors don't know what to make of Time Warner Inc.'s (NYSE: TWX) results.

First, shares rose this morning as investors gave a thumbs up to Chief Executive Jeff Bewkes' plan to dispose of the media conglomerate's cable television business. Then, they fell after the earnings conference call. Perhaps investors were expecting news on a deal for AOL. Otherwise, the parent of CNN, Time magazine and Warner Brothers posted mediocre quarterly results (pdf).

"We've decided that a complete structural separation of Time Warner Cable Inc. (NYSE: TWC), under the right circumstances, is in the best interests of both companies' shareholders, Bewkes said in the earnings release. "We're working hard on an agreement with Time Warner Cable, which we expect to finalize soon."

Time Warner investors, who have seen the value of their stock fall by more than 25% over the past year, have long wanted the company to dispose of its cable business. Owning both content and distribution doesn't seem to make much sense anymore. The question is what the New York-based company will do with the money from the sale.

Paul Greene, media analyst with T. Rowe Price, told Bloomberg News that the content business is cheap without the cable business and "if they get cash from cable and use that to buy back shares of the parent company, that's very accretive."

The other big question mark hanging over the stock is AOL. During the quarter, revenue fell 23% to $1.1 billion as subscription revenue slumped as a result of the company's switch to an advertising-supported business model. Advertising revenue, though, rose only 1% amid a decline in display advertising. These results will heighten pressure on Bewkes to do something about the internet business -- a deal with Yahoo! Inc. (NASDAQ: YHOO) would be nice -- because it's just not growing as fast as Wall Street would like.

But as Bloomberg notes, the performance at AOL will improve: "In the remainder of 2008, AOL's ad sales will rise because of revenue from the Platform A network for buying and selling ads, Time Warner said in a regulatory filing today. Sales of so-called display ads shown on Web sites will fall in the current three months, partly because of `expected continued challenges of integrating recently acquired businesses."

This may be a case of too little too late.

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Time Warner announces earnings, plans for cable division

Jon Ogg — 2008-04-30T11:30:00+00:00

Filed under: Earnings reports, Time Warner (TWX), Time Warner Cable (TWC)

This has been a busy morning for Time Warner Inc. (NYSE: TWX). The company announced earnings and also unveiled a plan for the divestiture of Time Warner Cable Inc. (NYSE: TWC).

First, Time Warner posted earnings (click here for the pdf file) of $0.22 EPS on revenues of $11.42 billion; First Call had estimates at $0.23 EPS and $11.39 billion in revenues. The company also reaffirmed (pdf) the 2008 guidance of $1.07 to $1.11 EPS (First Call is $1.09), and it sees 7% to 9% growth in OIBDA from the $12.9 billion base in 2007. As a result of a tax benefit, the company also sees 2008 cash flow at or above $4.5 billion.

Time Warner Cable beat estimates (pdf) in its first quarter report, with $0.24 EPS from operations and an 8% revenue rise to $4.16 billion; First Call had estimates of $0.22 EPS on $4.14 billion in revenues. Time Warner Cable also reaffirmed its guidance (pdf) for fiscal 2008, projecting a revenue growth rate of 9%, to $17.25 billion, and EPS between $1.25 to $1.30. First Call estimates are $1.27 EPS and $17.25 billion in revenues.

Now for the fun part, from the department of "Thank Heavens!" -- Time Warner Cable is going to be split off from Time Warner Inc. While the detailed spin-off plan wasn't available, the goal here looks to be a complete separation. CEO Jeff Bewkes noted that the companies expect to finalize an agreement soon. Based on roughly an 84% stake and a current market cap of $27.3 billion, the structure could be the most important part of this divestiture. This could amount to a difference of almost $23 billion for the parent, and it will also bring about some serious de-leveraging of the books as much of the debt belongs to the cable operations.

So far there is an inversion in share reaction, with Time Warner shares down 1% and Cable shares up 1%.

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