The Score: The Business Week in 7 Stocks
June 08 2018 - 05:53PM
Dow Jones News
By Laine Higgins
Microsoft Corp. - 0.9% Monday
As fears of a trade war bubbled anew, investors flocked to
stocks of tech giants at the start of the week. Shares of Apple
Inc., Amazon.com Inc. and Microsoft each closed at all-time highs
Monday, and then repeated the feat Tuesday. Many investors believe
tech companies can reliably increase earnings, even if a prolonged
fight over trade dents the global economy.
It certainly didn't hurt that Microsoft announced a $7.5 billion
deal Monday to buy coding-collaboration platform GitHub Inc.,
sending its shares up 0.9%.
Among the major tech stocks, Facebook Inc. was the notable
outlier after the company admitted to giving users' personal data
to over 60 companies, including Chinese
telecommunications-equipment maker Huawei Technologies Co. Then, on
Thursday, Facebook said that a bug had mistakenly made some private
posts by its users viewable to all.
Starbucks Corp. - 2.4% Tuesday
He came, he saw, he changed the way we drink coffee. On Monday
evening, Starbucks Chairman Howard Schultz, the man credited with
growing the Seattle-based coffee shop into a ubiquitous global
brand as chief executive from 2008 to 2016, announced he would step
down from his post as chairman. There is heavy speculation Mr.
Schultz's next act will include a run for political office, and he
told employees he plans to write a book about Starbucks's
social-impact work and its efforts to redefine the role and
responsibility of a public company.
Newell Brands Inc. - 1.6% Tuesday
Newell revealed a $395 million deal Tuesday to sell its Rawlings
sporting-goods business to Seidler Equity Partners and Major League
Baseball. Rawlings has been MLB's official supplier of game balls
since 1977, and its acquisition comes two weeks after the league
said its baseballs were unintentionally manufactured to be more
aerodynamic during the 2015 season and were partially responsible
for the 46% uptick in home runs from 2014 to 2017. The deal gives
MLB a chance to provide "even more input and direction on the
production" of the league's official ball, said Chris Marinak,
MLB's executive vice president for strategy, technology and
innovation.
Athenahealth Inc. - 0.7% Tuesday
Athenahealth co-founder Jonathan Bush stepped down as CEO amid
pressure from an activist hedge fund and roughly a week after
apologizing for domestic abuse involving his then-wife more than a
decade ago. The health-software company on Wednesday said that the
departure of Mr. Bush was effective immediately and that the firm
had begun exploring strategic alternatives, a move that could lead
to a sale or other changes. Former General Electric Co. CEO Jeff
Immelt was named executive chairman to guide Athenahealth as it
weighs its options.
Allergan PLC - 0.7% Tuesday
Activist investors want Allergan to tighten up. On Tuesday,
hedge funds Appaloosa and Senator Investment Group pressured the
drug giant best known for making Botox to separate the roles of
chairman and CEO, posts currently held by Brent Saunders. Their
public call for an outsider to take one of the jobs came just days
after Allergan announced it would sell its women's-health and
infectious-disease businesses in attempt to cut costs and boost its
stock, which has shed over half its value since July 2015. The
investors said they were "underwhelmed" by the plan and said it
showed the company's "desire to cling to a status quo." Two days
later, Bloomberg reported that Carl Icahn had purchased a small
stake in the company, though his motivations were unclear.
McDonald's Corp. - 4.4% Thursday
McDonald's notified employees via email on Thursday of a plan to
slim its corporate structure with an unspecified number of layoffs.
The job cuts are the fast food chain's latest attempt to
reinvigorate its slumping U.S. business that lost approximately 500
million orders to rival chains since 2013. The company has already
cut a number of corporate jobs in the last two years and said it is
reinvesting some of its cost savings in technology, such as digital
ordering, that it believes will lead to growth.
J.M. Smucker Co. - 5.4% Thursday
Smucker shares fell sharply Thursday after the maker of Folgers
coffee and Jif peanut butter said higher costs were hurting
profitability and the company needed to raise retail prices on some
foods. Like other food makers, Smucker is struggling to adapt its
brands to consumers' demand for fresher, more natural food, and the
stock is off more than 20% in the past year. Canada's announcement
last week that it was considering new tariffs on a variety of U.S.
products, including strawberry jam, in retaliation for U.S. steel
and aluminum tariffs, also hasn't helped the shares.
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(END) Dow Jones Newswires
June 08, 2018 17:38 ET (21:38 GMT)
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