Investors have thrown in the towel on Lyft (NASDAQ: LYFT), Vail Resorts (NYSE: MTN), and Shake Shack (NYSE: SHAK), due to the very serious headwinds they are facing from the COVID-19 outbreak. Lyft is the second-largest ride-hailing business in the United States after market-leader Uber Technologies. Plus, the company has a highly variable cost structure, meaning that when revenue collapses, most of its costs disappear, too.
The undersea cable will be the largest to date, stretching 37,000km or 22,991 miles.
The definitive guide to the best hiking boots available now, with reviews for each boot, plus tips and trivia to know before you buy.
The tech giant isn’t waiting around for countries to build faster internet networks.
Vail Resorts (NYSE: MTN) had plenty of bad news to share with investors in April, but tailwinds from the market recovery and a plan to credit pass holders next year helped lift the stock. Shares finished April 16% higher, according to data from S&P Global Market Intelligence.
JMIA earnings call for the period ending March 31, 2020.
Rating Action: Moody's takes rating actions on South African corporates following sovereign downgrade. Global Credit Research- 04 Apr 2020. NOTE: On April 8, 2020, the press release was corrected as follows: ...
What happened Wall Street ended Monday in the green, with the Dow Jones Industrial Average up a solid 1.5%. And some stocks are looking a whole lot greener than others. Investors appear particularly enthusiastic about travel and resort companies, for example, with the following four reaping outsize gains: MGM Resorts (NYSE: MGM) stock closed 9.
(Bloomberg) -- As the Federal Reserve pulls out all the stops to bolster credit markets, corporate America is gorging on debt.From Carnival Corp., Marriott International Inc. and Delta Air Lines Inc. to Gap Inc. and Avis Budget Group Inc., many of the companies hardest hit by the coronavirus outbreak have priced billions of dollars of bonds and loans in recent weeks.Never mind that profits have been wiped out, and that their business operations aren’t viable right now or likely anytime soon. As long as they’re propped up by the Fed, investors are willing to lend.Yet as expectations of a V-shaped economic recovery vanish rapidly, more and more industry veterans are starting to express concern about these debt dynamics. Some warn that the Fed is putting credit markets on course for a future wave of defaults that makes the current stretch of corporate bankruptcies look timid by comparison.Others see an outcome even more dire.In this scenario, they say, moribund companies in industries deeply scarred by the pandemic will just keep borrowing. Market watchers such as Deutsche Bank AG chief economist Torsten Slok fear that a new breed of so-called zombie companies -- firms that don’t earn enough to cover interest payments and are kept alive in part by central bank largess -- could have profound and painful consequences for everyone from workers to investors for years to come.“The Fed and the government are interfering in the process of creative destruction,” Slok said in an interview. “The consequence is that we are at risk the longer this persists –- companies being kept alive that would otherwise have gone out of business -- that it will begin to weigh on the overall potential for growth of the economy and on productivity.”It’s not that these risks mean the Fed’s current policy tack is misguided. Given the scope of the economic collapse and the unprecedented spike in unemployment that has accompanied it, most analysts say policy makers had to throw everything they could at the problem. It’s just that such dramatic intervention comes with great risks that will have to be addressed down the road.“The Fed had no other choice than to do what it did,” Slok said.Still, it’s precisely this dramatic intervention that’s emboldening money managers to take greater chances and seek fatter returns.“You can’t say ‘we’ll do whatever it takes’ and not do it,” said Jack McIntyre, who helps oversee about $60 billion at Philadelphia-based Brandywine Global Investment Management. “Otherwise, the Fed will lose credibility.”McIntyre said he’s buying select investment-grade corporate bonds in lieu of Treasuries “because the Fed has backstopped the market -- if spreads widen, the Fed will step in.”That’s just the sort of sentiment that can ultimately lead to the proliferation of zombies, economists say.Fed BackstopThe actual definition of what makes a company a zombie varies depending on who you ask, but most agree that it’s generally meant to encompass firms that can’t cover their debt servicing costs from current profits over a select period.A snapshot of the market reveals no shortage of companies that would fit that description should the economic rebound take time to gain momentum.Earnings for companies, excluding financials, in the S&P 500 are forecast to drop a staggering 42% in the second quarter from the previous year as the full effect of global lockdowns are felt, according to estimates compiled by Bloomberg.At the same time, net corporate debt issuance has ballooned, and could approach as much as $1 trillion this year, according to Bloomberg Intelligence.Delta and Marriott declined to comment, while Avis didn’t respond to requests seeking comment.Carnival referred Bloomberg to a press release highlighting the strength of its balance sheet and continued customer bookings for the second half of the year and 2021.A representative for Gap directed Bloomberg to a statement noting its financing and cash preservation efforts, adding that the company plans to have 800 stores open by the end of May.If the pace of the recovery is quick enough, corporate-bond buyers say plenty of hard-hit companies should be able to turn things around.But the question on the minds of investors and economists alike is: how long will the Fed be willing to support firms via its pledge to buy corporate debt if the recovery is slower to develop than expected?“The government has done more than I could have imagined to allow businesses to access capital, and if the markets shut down again the government will do even more,” said Bill Zox, chief investment officer of fixed income at Diamond Hill Capital Management, which manages around $19.5 billion.Borrowing BingeIt’s an especially salient question when it comes to the sectors hardest hit by the Covid-19 outbreak.Cruise lines have borrowed more than $8 billion via the bond market in recent weeks, selling notes secured by everything from ships to islands. Airlines, for their part, have gotten more than $14 billion in new financing from banks and investors, even as the vast majority of flights remain grounded.“We have entire industries that are going to be protracted long-term if not permanently disrupted because of this,” said Vicki Bryan, a veteran credit analyst who runs Bond Angle LLC. “The cruise industry is ripe for elimination of companies. It should logically renounce the weaker players but that’s not happening because we have dirt-cheap money that we’re willing to throw back into the market from the Fed.”Beyond just lending them money, creditors are also waiving or loosening financial markers on existing debt, allowing companies that have seen revenue dry up stave off potential tumult.Vail Resorts Inc. -- owner of the eponymous winter vacation destination -- was granted a two-year reprieve on key debt covenants last month, paving the way for the company to raise $600 million with a new bond offering. Marriott, one of the world’s largest hotel chains, struck a similar agreement with lenders.A representative for Vail said that the company’s bank covenant waiver provided additional flexibility given the short-term dislocation from Covid-19, and that it remains confident in the long-term outlook for both profit and cash flow.‘Catch-22’Yet amid the waivers, lenders are extracting higher interest rates or other concessions.Norwegian Cruise Line Holdings Ltd., AMC Entertainment Holdings Inc. and Avis all paid double-digit yields to borrow in recent weeks. That could depress their capacity to make capital expenditures and adapt to shifting consumer tastes as the coronavirus changes how people spend money.“Taken together with margin contraction and leverage that was already near record highs, you may end up with a corporate sector that has less capacity to invest in growth,” said Noel Hebert, director of credit research at Bloomberg Intelligence.Norwegian has a “long-standing track record of strong financial performance which includes over a decade of financial growth,” a company spokesperson said in an emailed response to questions. “The cruise industry has been hit the hardest by Covid-19 as our operations have been completely shut down, which certainly impacts us in the short-term but has no bearing on our long-term success.”AMC didn’t respond to requests seeking comment.Read more: Corporate debt loads are growing fast as Fed opens up spigotsSome say as successful as the Fed has been boosting credit-market liquidity, the support is only temporary, and will result in a wave of distress when it steps back.“There will be plenty” of debt defaults and bankruptcies when corporate borrowers start running out of cash in the months ahead, Howard Marks, co-chairman of Oaktree Capital Group, said in a Bloomberg TV interview. “There are large, highly levered companies and investment vehicles that the government and Fed rescue program is not likely to reach and take care of.”Others see central-bank intervention keeping companies alive for much longer, crowding out investment and employment at healthy firms, similar to what occurred in Japan during the nation’s ‘lost decade’ of the 1990s, where the ‘zombie company’ term was first applied.“You are misallocating capital to businesses that are not productive and in some sense taking resources away from companies that have high growth,” Deutsche Bank’s Slok said.The repercussions may only become apparent years from now, according to Marc Zenner, a former co-head of corporate finance advisory at JPMorgan Chase & Co.“It’s hard for me to think that something like that doesn’t have a cost,” Zenner said. “What you’ll see is some of these costs will probably only emerge years later. Are we going to have reduced capacity to act? Is it that other economies will be less burdened and will attract more capital? Is there another crisis that will come because of this misallocation of capital?”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
VEON earnings call for the period ending March 31, 2020.
The cable will wrap around Africa bringing faster internet access to the continent.
New mega subsea cable to bring more reliable high-speed internet to Africa, Mideast
Vail Resorts, Inc. (NYSE: MTN) today announced it intends to commence a private offering to eligible purchasers, subject to market and other conditions, of $500 million in aggregate principal amount of senior notes due 2025 (the "Notes"). The Notes will be unsecured senior obligations of the Company and will be guaranteed by certain of the Company's domestic subsidiaries (other than certain excluded subsidiaries).
The stock market has enjoyed a tremendous rally in recent weeks, but the airlines have missed out on the rebound. United Airlines (NYSE:UAL) stock, along with other rivals, has barely budged off their multi-year lows.Source: travelview / Shutterstock.com This is particularly troublesome news for UAL investors because the stock finds itself in dangerous territory. It's a well-known principle in technical analysis.Companies that fail to go up when the market rallies are the most vulnerable in the next correction. Just as traders want to own the leading stocks, they want to avoid (or sell short) the laggards.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAirlines just received a massive government aid package, and most other transportation stocks, like railroads and parcel delivery companies, are surging. Yet the airlines have been losing altitude. And that will only accelerate in coming weeks. Demand Won't Return OvernightOver the past few weeks, bulls have been quick to point out a potential upside scenario. With the Fed and Treasury engaged in unprecedented stimulus, there is a lot of money sloshing around out there to boost the economy.Additionally, there are signs that the virus is starting to slow down. Thus, much of the country should be able to reopen, at least to a considerable degree, in May.With that in mind, shouldn't the economy start getting back to normal this summer? "Starting to" is the operative phrase. It won't be a light switch, where everything turns back on suddenly. A lot will come back quickly assuming the virus follows a fairly benign path. But we aren't getting back to 100% of normal that soon.For one thing, the unemployment rate will likely reach 20%, or somewhere around there, within a few months. Those people are going to spend far less money than they used to. And many businesses will remain closed or have greatly reduced operations until 2021.Concerts, live sports, festivals, business conventions, and more - those drivers of air travel will be slow to return. Even if regulators permit these events, many folks will choose to avoid large gatherings for now. 80% Isn't Good EnoughFor many companies, particularly ones with great balance sheets, they can endure a slowdown. If they get 80% of normal business for a while, they'll take an earnings hit, but they can get by. Airlines are not like that, however.Given the immense fixed costs and overhead, airlines need every dollar they can obtain. There's a reason airlines nickel-and-dime passengers with steeper and steeper fees; it's the difference between making a small profit and a loss on every flight. In fact, just a couple points swing in load factor - how full an airline's planes are on average - is the difference between being in the green and losing hundreds of millions of dollars per year. United Hubs Will See Lingering SlowdownsSpecifically to United, it's worth considering that two of its hubs may be especially affected by the virus. The Houston hub is a vital port for both the energy industry and Latin-America bound travelers. Both of these will be under heavy fire.The recent oil crash has energy companies rushing to cut costs; they'll certainly be spending less on business travel. And many formerly well-paid Houston energy workers will be out of work altogether in a $20 oil world, causing a steep drop in leisure demand from there as well.Houston also serves as United's big hub for Latin American travel. Given its ideal position as the nearest hub to many major Mexican and Central American cities and beaches, it has been a solid asset for United. Now, however, Latin American economies are plummeting; Mexico City in particular is one of the world's hardest-hit big cities by the coronavirus, and recovery could be slow - the virus is still growing exponentially there now.And then you've got United's Denver hub. There have always been questions about the Denver hub, given the level of competition there. Southwest (NYSE:LUV), Frontier, and United all fight over a market that isn't that big. And now, two major drivers of Denver traffic are in trouble. Denver is a major energy and natural resources hub, so it faces a traffic loss there, like Houston.Denver is also the entry point for Colorado's world-famous ski resorts; Vail Resorts (NYSE:MTN) is headquartered nearby. Vail had to suspend skiing operations for this current winter season due to the virus. And it's unclear what that 2020-21 ski season will look like. If there is no big second wave of the virus, Vail will probably operate.But in a dismal economy with double-digit unemployment, will people be in the mood for expensive destination vacations like that anyway? UAL Stock VerdictUnited stock dipped sharply last week after launching a secondary offering. It sold 42 million shares at $26.50. The stock tumbled nearly 10% on the news. This is a problem because, while it may sound like a lot of money, it will only cover United's expenses for about a month at the current $1 billion or so monthly burn rate.When you start considering United's probable losses over the next three or six months, you start wondering just how many times the company may have to raise cash, causing further share sell-offs. And even if 80% of traffic comes back pretty quickly, the company likely will continue to lose lots of money out into 2021.Remember that the government put strict restrictions in place around firing employees and other moves that will keep airlines' cost structures elevated even as revenues are scarce.With the government bailout, airlines got a lifeline. And United prudently raised more money last week. However, as investors realize that there will be no quick recovery for the industry, look for the airlines to take another big leg lower. The fact that UAL stock has hardly advanced at all since the March lows, despite a tremendous market rally, is a glaring warning that the stock is vulnerable to sharp downside in the near future.Ian Bezek has written more than 1,000 articles for InvestorPlace.com and Seeking Alpha. He also worked as a Junior Analyst for Kerrisdale Capital, a $300 million New York City-based hedge fund. You can reach him on Twitter at @irbezek. At the time of this writing, he held no positions in any of the aforementioned securities. More From InvestorPlace * America's 1 Stock Picker Reveals Next 1,000% Winner * 25 Stocks You Should Sell Immediately * 1 Under-the-Radar 5G Stock to Buy Now * The 1 Stock All Retirees Must Own The post There Is No Quick Fix For United Airlines appeared first on InvestorPlace.
Kenya's Safaricom, France's Orange, South Africa's MTN and Zimbabwe's Econet Global have also showed an interest to bid for the right to bid in Ethiopia.
(Bloomberg) -- Wall Street is giving a generous reprieve to the owner of some of its favorite destinations for winter sports.A group of lenders led by Bank of America Corp. granted the operator of ski resorts in Vail and Whistler a two-year break on key debt covenants, paving the way for the company to raise $600 million with a new bond offering.The waiver for Vail Resorts, Inc., which extends until Jan. 2022, is one of the longest banks have granted to companies suffering as a result of the Covid-19 pandemic. That suggests the company believes it may take as long as two years for business to return to normal.Vail Resorts is still optimistic about next year’s ski season, Chief Executive Officer Rob Katz said in an emailed statement.“And consistent with our historical approach, we also are committed to providing the company as much financial flexibility as possible in the current environment,” Katz said.Ski resorts became one of the early hotbeds of contagion for the virus. Mexico identified Vail as a key source of coronavirus cases after some travelers who had returned from the resort tested positive. Some of the first cases in Europe were traced back to a ski town in the French Alps.Read more: Wall Street caves to companies’ demands to stave off defaultsYet investors seemed willing to look beyond those challenges.Vail received some $5.8 billion in orders for the bond, or nearly ten times the final amount of the offering, according to people with knowledge of the matter. The company had initially targeted a $500 million deal.In another sign of strong demand, the notes priced at a yield of 6.25%, down from early conversations of as much as 7%, the people said, asking not to be named because the discussions are private.A representative for Bank of America, which is leading the sale, declined to comment.New RestrictionsThe covenant waiver for the company’s existing credit agreement comes with some strings attached, including limitations on dividend payments and investments as well as a minimum liquidity requirement.During the waiver period, Vail won’t be able to raise any additional debt that is secured by collateral of existing loans other than drawing on its existing revolver commitments.The company is the largest operator of ski resorts in the world, with 37 locations across the U.S., Canada and Australia.The company closed all of its North American resorts for the season in mid-March and has already drawn down its bank credit lines. It expects to have $1.2 billion in liquidity following the bond sale, it said.(Updates deal and order book size starting in second paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
A new undersea cable connecting 16 countries in Africa has been announced – by a consortium including China Mobile International, Facebook, MTN GlobalConnect, Orange, stc, Telecom Egypt, Vodafone and WIOCC – and promises more that the total combined capacity …
(Bloomberg) -- Facebook Inc. and some of the world’s largest telecom carriers including China Mobile Ltd. are joining forces to build a giant sub-sea cable to help bring more reliable and faster internet across Africa.The cost of the project will be just under $1 billion, according to three people familiar with the project, who asking not to be identified as the budget hasn’t been made public. The 37,000-kilometer (23,000 miles) long cable -- dubbed 2Africa -- will connect Europe to the Middle East and 16 African countries, according to a statement on Thursday.The undersea cable sector is experiencing a resurgence. During the 1990s dot-com boom, phone companies spent more than $20 billion laying fiber-optic lines under the oceans. Now tech giants, led by Facebook and Alphabet Inc.’s Google, are behind about 80% of the recent investment in transatlantic cable, driven by demand for fast-data transfers used for streaming movies to social messaging.Facebook has long tried to lead the race to improve connectivity in Africa in a bid to take advantage of a young population, greater connectivity and the increasing availability and affordability of smartphones. The U.S. social-media giant attempted to launch a satellite in 2016 to beam signal around the continent, but the SpaceX rocket carrying the technology blew up on the launchpad.Google announced its own sub-sea cable connecting Europe to Africa last year, using a route down the west coast.2Africa is expected to come into operation by 2024 and will deliver more than the combined capacity of all sub-sea cables serving Africa, according to the statement. The announcement comes after internet users across more than a dozen sub-Saharan African nations experienced slow service in January after two undersea cables were damaged.Facebook has partnered on the new cable with two of Africa’s biggest wireless carriers, Johannesburg-based MTN Group Ltd. and Telecom Egypt Co. The U.K.’s Vodafone Group Plc and Paris-based Orange SA, which both have a significant presence on the continent, are also involved. Nokia Oyj’s Alcatel Submarine Networks has been appointed to build the cable.The 2Africa cable will be one of the longest in the world, trailing Sea-Me-We 3, which is 39,000 kilometers long and connects 33 countries, according to Submarine Cable Networks.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
CSGS earnings call for the period ending March 31, 2020.
Baron Asset Fund recently published its first-quarter commentary – a copy of which can be downloaded here. During the first quarter of 2020, the Baron Asset Fund returned -16.63% (institutional shares). In comparison, the benchmark S&P 500 Index was down 19.60%, while the Russell Midcap Growth Index was down 20.04%. In the said letter, Baron Asset […]
As of 11:45 a.m. EDT, shares of mountain skiing specialist Vail Resorts (NYSE: MTN) are climbing 10.8%, hotelier Marriott International (NASDAQ: MAR) is up 13.8%, and casino operator Eldorado Resorts (NASDAQ: ERI) is doing best of all -- gaining 19.5%. This is a slow start -- but at least a start -- to reopening Eldorado Resorts.
Turkcell had another good operating quarter, with further growth in postpaid subscribers, fiber/pay TV subscribers, and data/digital service utilization. Turkey remains a "basket case economy" in the eyes of many investors, undermining the currency an…
Season pass holders will receive a minimum credit of 20% toward next season's pass. For season pass holders who used their pass less than five days, they will be eligible for higher credits up to a maximum of 80% for season pass holders who did not use their season pass at all.
A slump in out-of-home sales and the lack of live sports has led soda marketers to hit the brakes on TV, ad spend data shows. The post It’s not just Coke — the entire soda sector has slashed ad spending appeared first on Digiday.
Rating Action: Moody's assigns Vail Resorts' CFR of Ba3 CFR; senior unsecured notes rated B2. Global Credit Research- 29 Apr 2020. New York, April 29, 2020-- Moody's Investors Service, assigned ratings ...
In comparison, the bourse had posted a net profit of Rs 51.86 crore in the year-ago period.
Facebook has announced plans to build a massive 37,000-kilometer undersea cable around Africa in an effort to increase the continent's internet connectivity, as detailed in a blog post by the company this week. The cable will be "nearly equal to the circumfer…
Vail Resorts Announces Fiscal 2020 Third Quarter Earnings Release Date
Vail Resorts' CEO has also said his company was looking at ways to compensate Epic Pass holders.
Vail Resorts (NYSE: MTN) announced Monday that, because of SARS-CoV-2 coronavirus-related closures, it will offer credit for current pass holders who purchase permits for the upcoming 2020-2021 season. For the company's frequency-based permits, such as the Epic Day Pass and Edge Card, Vail Resorts will provide credits for every unused day. As with the season pass, the maximum effective discount will be 80%.
Firm releases 1st-quarter portfolio Continue reading...
Dan Clowes, general manager at Taylor's Auto Max in Great Falls, says they've seen steady sales over the past few months.
Influential money manager John Rogers of Ariel Investments tells Yahoo Finance his firm is back in the market buying stocks.
OPRA earnings call for the period ending March 31, 2020.
The resort giant stands to gain the most from a quick recovery in the leisure industry. But that might not happen.
Vail Resorts, Inc. (NYSE: MTN) today announced the pricing of its previously announced senior notes offering. The Company priced $600 million in aggregate principal amount of 6.250% senior notes due 2025 at par (the "Notes"). The offering of the Notes was upsized from the originally announced aggregate principal amount of $500 million. The Notes offering is expected to close on May 4, 2020, subject to customary closing conditions. The Notes will be unsecured senior obligations of the Company and will be guaranteed by certain of the Company's domestic subsidiaries (other than certain excluded subsidiaries).