Author Archives: Scalper1

Is Amazon-Backed Web China Grocery Vendor Yummy77 ‘Out Of Cash’?

Amazon.com ( AMZN )-backed Chinese online grocery sales website Yummy77 might have run out of cash, making it the first major casualty of China’s super-competitive online grocery market, according to Young’s China Business blog. The report comes after two major new funding announcements illustrated the potential for online grocers in China. Amazon’s name still appears at the top of Yummy77’s webpage, with the notation that it is a “strategic cooperative partner,” and clicking on the name takes you to a Yummy77 food section on Amazon’s own China website. “But Amazon’s China page also contains its own Amazon-branded food section with extensive offerings. That would seem to indicate that Yummy77 was still operating independently and was only getting marketing assistance from Amazon as a strategic partner,” the report said . China’s Yummy77 is not related to the Los Angeles-based online grocery company Yummy.com, a spokesperson for the U.S. company confirmed to IBD. Yummy77’s troubles highlight the big potential — and the big risks — for online grocers in China, where the market is teeming with new companies rushing to cash in on the trend. The Yummy77 report comes after two other online fresh food sellers raised big bucks in March. Yiguo — backed by China e-commerce giant Alibaba Group ( BABA ) — raised $260 million, the report said. Another China e-commerce leader, JD.com ( JD ), backs Fruitday, a fresh produce electronic retailer which raised $100 million in new funding , said the report. “Entrepreneurs are realizing that Chinese consumers are very willing to buy almost anything over the Internet that used to be sold in traditional brick-and-mortar stores. Even highly perishable items like fruit and meat are following the trend, thanks to recent logistical improvements that are making same-day deliveries common, sometimes just an hour or two after an order is placed,” Young’s China Business said in a prior report in March . Chinese Internet companies are in a sweet spot as the country quickly moves to broadband mobile platforms, fueled by a burgeoning middle class with more disposable income. In May, JD.com launched a grocery delivery service in partnership with stores in select urban areas. It also invested $70 million in Fruitday. JD.com stock was up 1.5% in afternoon trading in the stock market today , while Amazon stock was up a fraction and Alibaba stock down a fraction.

AT&T, Verizon Wireless Q1 Margin Boost Might Last Until iPhone 7

Wireless profit margins at AT&T ( T ) and Verizon Communications ( VZ ) should improve when they report first-quarter earnings — owing to fewer customers upgrading to new smartphones — a trend that might continue until Apple ( AAPL ) rolls out its iPhone 7 in the fall. The improving wireless margins at Verizon and AT&T has its roots in financing plans with monthly installment payments and accounting methods. Michael Rollins, an analyst at Citigroup, says upgrade rates are falling as wireless customers hang onto devices longer. “The longer device embrace by customers should help carrier financials for the first quarter,” Rollins said in a research report Friday. Apple’s iPhone 6S refresh was only a “marginal improvement” over the earlier iPhone 6, but the iPhone 7 should be different, Rollins says. “The iPhone 7 could lead to another industrywide upgrade cycle, as has been seen by each new ‘number’ of iPhone, and we await more details about the innovations it will contain,” he wrote. “Even with faster device sales in Q4, we are starting to see signs that the device cycle could eventually extend to 27 to 30 months, up from more traditional pacing of 24-26 months back in 2014-2015.” Jefferies analyst Mike McCormack has a similar view. “We expect lower volumes as upgrades hit record lows, supporting stronger industry margins,” McCormack said in a research note Thursday. “We expect this theme to prevail going forward, at least until the iPhone 7 launch this fall. We see opportunity for margin outperformance at both AT&T and Verizon, and continued positive momentum at T-Mobile US ( TMUS ).” Verizon kicks off the telecom Q1 earnings season on April 21, followed by AT&T on April 26. UBS analyst John Hodulik was ahead of the pack with a report out March 18. “The move to installment sales for handsets has been a big driver of improved industry profitability given the accounting treatment,” wrote Hodulik. “However, installment plans are also having more tangible effects on the industry by lengthening upgrade cycles for postpaid phones. “This is putting pressure on upgrade rates, which is in turn driving lower churn and fewer gross adds. We believe this will be a key theme for Q1 earnings, driving another quarter of strong sector profitability, especially at AT&T and Verizon.” Shares of both AT&T and Verizon were up a fraction in afternoon trading in the stock market today .

U.S. Broker-Dealer And Japan: 2 ETFs To Watch On Outsized Volume

In the last trading session, U.S. stocks ended on a weaker note thanks to renewed global growth concerns. Among the top ETFs, investors saw the SPDR S&P 500 Trust ETF (NYSEARCA: SPY ) go down 1.2%, the S PDR Dow Jones Industrial Average ETF (NYSEARCA: DIA ) lose 0.99% and the PowerShares QQQ Trust ETF (NASDAQ: QQQ ) shed 1.44% on the day. Two more specialized ETFs are worth noting as both saw trading volume that was far outside of normal. In fact, both these funds experienced volume levels that were more than double their average for the most recent trading session. This could make these ETFs the ones to watch out for in the days ahead to see if this trend of extra-interest continues: iShares U.S. Broker-Dealers ETF (NYSEARCA: IAI ) : Volume 3.73 times average This U.S. broker-dealer ETF was under the microscope yesterday as nearly 417,000 shares moved hands. This compares to an average trading day of 117,000 shares and came as IAI lost about 3.3% in the session. The movement was due to the dovish Fed minutes as lower rates hamper the income for broking companies. However, the fund has a Zacks ETF Rank #3 (Hold). IAI was down about 3.8% in the past one-month period. iShares MSCI Japan ETF (NYSEARCA: EWJ ) : Volume 2.36 times average This Japan ETF was in focus yesterday as roughly 117.6 million shares moved hands on that day compared to an average of roughly 50.9 million. We also saw some share price movement as shares of EWJ lost 0.5%. The movement can largely be blamed on the strengthening of the yen against the dollar. It could have a big impact on Japan stocks that we find in this ETF portfolio. For the past one month, EWJ was down 3.4%. The fund currently has a Zacks ETF Rank #3 with a Medium risk outlook. Link to the original post on Zacks.com