Author Archives: Scalper1

Yahoo Seen Bringing Verizon Heft In Ad Technology, Mobile Video

Troubled Web portal Yahoo ( YHOO ) would be a good fit for Verizon Communications ( VZ ), bringing the communications giant more heft in advertising technology and mobile video, Macquarie Capital said Tuesday. Verizon reportedly is among those that plan to bid for Yahoo’s Web business and its holdings in Yahoo Japan. Yahoo is looking to sell all or part of its operations, including its core search business and substantial holdings in Alibaba Group ( BABA ) and Yahoo Japan. Yahoo reportedly has set an April 18 deadline for bids. In the meantime, it faces a proxy fight from activist investor Starboard Value, which wants to oust the entire board. “Yahoo’s current turnaround plan focuses on three key platforms (mail, search and Tumblr), four key verticals (news, sports, finance and lifestyle), and two advertiser offerings (Gemini and BrightRoll),” wrote Macquarie analyst Amy Yong in a research report. “Yahoo’s strategy and assets fit well with Verizon’s three-pronged plan, but execution is key,” she said. “If done properly, we believe the companies’ combined assets would allow for more aggressive competition in spaces including: ad-tech and mobile video … as well as content and display advertising.” “Significant” job cuts would result from a Verizon-Yahoo deal, Yong said. Yahoo already is in the process of axing 15% of its workforce, or about 1,600 jobs. Macquarie analyst Ben Schachter estimates that Yahoo’s core business could fetch $3 billion to $5 billion. He estimates 2016 EBITDA (earnings before interest, taxes, depreciation and amortization) of $750 million. Yahoo’s market cap is $34.5 billion. Yahoo Revenue Seen Falling 15% This Year An estimated 40 groups have expressed interest in buying all or part of the financially wilting Sunnyvale, Calif.-based Web portal. News site Re/Code said last week that documents Yahoo provided to potential bidders predict that the Web portal’s 2016 revenue will drop by close to 15% and its earnings by more than 20%. Rumored bidders for Yahoo include the Daily Mail, the British tabloid newspaper which on Monday reportedly confirmed its interest, attracted to Yahoo’s popular news and media properties. The Daily Mail is in preliminary talks with other investors to launch a bid for Yahoo, the Wall Street Journal reported Monday, confirming a previous WSJ report out Sunday. Yahoo stock rose more than 1% on Monday and was up a fraction, near 36.50, in midday trading in the stock market today . Yahoo sent a letter to possible buyers last month, asking them to submit bids. Some buyers might be interested in all or part of Yahoo’s core Web business, while others might want Yahoo’s stakes in China e-commerce Alibaba or Yahoo Japan. Google, the main division of Alphabet ( GOOGL ), reportedly is considering a bid for Yahoo’s core business. Media company Time ( TIME ); Japan’s SoftBank ( SFTBY ), the majority owner of Yahoo Japan; and several private equity firms also are kicking the tires, reports Bloomberg. Yahoo has also held meetings with IAC/InterActiveCorp ( IAC ) and CBS ( CBS ), the WSJ said. One-time potential suitors including AT&T ( T ) and Comcast ( CMCSA ) have decided against bidding, Bloomberg reported. Microsoft ( MSFT ), which failed with a hostile bid for Yahoo in 2008, also won’t bid, according to Bloomberg.

Palo Alto Networks Gouges Cisco, Check Point, Fortinet: Survey

Palo Alto Networks ( PANW ) gouged rivals Cisco Systems ( CSCO ) and Check Point Software Technologies ( CHKP ) during Q1, as Fortinet ( FTNT ) and Symantec ( SYMC ) demand toppled, according to a Piper Jaffray survey of 26 resellers and distributors. Meanwhile, cybersecurity vendors Imperva ( IMPV ) and FireEye ( FEYE ) improved on Q4 demand, and CyberArk Software ( CYBR ) and Proofpoint ( PFPT ) demand remained relatively stable. Cybersecurity stocks largely fell as of midday trading on the stock market today , with IBD’s 25-company Computer Software-Security industry group down nearly 1.5%. Proofpoint and Fortinet stocks led the plunge, both down more than 4% midday Tuesday. CyberArk stock was down more than 2%, and Palo Alto Networks stock was down more than 1%. Imperva was down more than 2.5%, and FireEye fell nearly 2%. Symantec and Check Point stocks bucked the trend, trading flat and up 1%, respectively. Check Point is losing to Palo Alto Networks, according to resellers surveyed by Piper Jaffray analyst Andrew Nowinski, but half of the resellers cited Cisco as the rival Palo Alto Networks beats out most frequently. “Cisco and Check Point have consistently been called out by resellers as the vendors most frequently losing to Palo Alto,” Nowinski wrote in a research report. In Q4 and Q3, Juniper Networks was also cited by 13% and 18% of resellers as losing to Palo Alto Networks. “However, this is the first quarter resellers cited Fortinet as competition to Palo Alto, suggesting Fortinet may be moving more upstream into the mid-market enterprise space,” Nowinski wrote. Only 35% of resellers sold more Palo Alto Networks products than they expected, Nowinski wrote, down from 56% in Q4. The largest distributors say Palo Alto Networks demand trends were unchanged, he added. Imperva jumped in Q1, as 20% of resellers were above plan vs. 8% in Q4. And FireEye demand improved to 31% below plan from 36% in Q4. CyberArk and Proofpoint were largely in line. But Fortinet and Symantec declined. In Q1, 31% of Fortinet resellers were below plan vs. 14% in Q4. Symantec fell to 50% below plan vs. 29% in the prior quarter.

5 Top Chip Stocks Seek Support Amid Enterprise Demand Warning

Highly rated chipmakers Macom Tech ( MTSI ), Microsemi ( MSCC ), MaxLinear ( MXL ), Inphi ( IPHI ) and Cirrus Logic ( CRUS ) are dropping in heavy volume today, though they pared their losses as the tech-heavy Nasdaq rallied by the early afternoon. Some of the selling pressure is potentially coming from Juniper Networks ‘ ( JNPR ) earnings preannouncement late Monday. The networking equipment vendor lowered its first-quarter revenue and earnings expectations below Wall Street estimates, citing weaker-than-anticipated demand from enterprise customers. Macom tumbled intraday below its 50-day line and the 40 price level in intraday trade, but the shares are now looking for support at those levels, down 2.9% in early afternoon action. The stock is trading 11% below its recent high. Microsemi is plunging back below buy range from a cup-with-handle base buy point it initially cleared in mid-March, losing 2.5%. In intraday trade, shares neared the 50-day line, which recently crossed back above the 200-day line as the stock’s performance improved. MaxLinear also dropped back below buy range from a base it initially cleared in early March, though it pared its losses, sliding 2.8% in early afternoon action. Several weeks ago, the stock dipped back below buy range but found support at the 50-day line before regaining composure. Inphi is still well extended from a double-bottom entry at 28.54, but it tested the lower bound of its buy range from an alternate entry at 32.42. Shares dipped 1.2% to 33.41. And Apple ( AAPL ) supplier Cirrus Logic is testing support at its 50-day line, but it bounced back to trade unchanged. Shares are trading 7% below their high set last May. Apple, for its part, rose 0.6% intraday. Meanwhile, Juniper Networks gapped down 8% on the bearish outlook, plunging below its 50-day line in giant volume. The stock is now 29% below its November peak.