“Malls are far from dead” — Foot Locker CEO Dick Johnson, whose company defied the retail downtrend with strong sales growth thanks to so-called “sneaker culture.” Fresh kicks are always in style.
MARKET SNAPSHOT
Big Picture
Alternatives to Watch
Market Movers
CORPORATE PRIMER
To Be Young Again
…Facebook launches a new app for teenagers only. Lifestage is a new app for high schoolers, which turns video clips that users recorded into a video profile. Here’s how it works: students sign up, select their high school, and then will see video profiles from nearby classmates. What’s the point of these videos? Facebook will ask users questions such as your likes, dislikes, and your best friend. All very interesting stuff. The launch of the new app comes on the same day CEO Mark Zuckerberg disclosed that he sold $95 million in Facebook shares that will be donated as philanthropy. Hats off.
Save a Horse
…Buy a tractor. John Deere reported earnings on Friday, cruising into the weekend after handily beating expectations. While Deere’s revenue in the quarter was down 11%, earnings surprised enough to cause shares to jump 13%. Deere also adjusted its 2016 net income estimates upwards to $1.35 billion from $1.2 billion. Earnings produced optimism about the cyclical nature of the agricultural sector in South America, particularly in Brazil, which is a significant buyer of the company’s wares. On the other hand, CEO Rajesh Kalathur cautioned that U.S. and Canadian equipment sales could be down as much as 20% for 2016. Yikes.
Suitors Wanted a Lyft
…But didn’t want to drop $9 billion. On Friday, GM expressed an interest to buy out ride-hailing giant Lyft as an attempt to leverage its current equity in Lyft. The purpose? Creating a network of self-driving cars, of course. Naturally, Lyft placed a $9 billion dollar price tag on itself and strutted its stuff at Alphabet, Amazon, Microsoft, and Apple—but no dice. Analysts see this as one of the few options left for Lyft, with Uber concentrating all efforts in the US and an IPO on the horizon.
Viacom Lost the Battle
…But won the war. The $40 billion dollar empire was able to successfully part ways with CEO Philippe Dauman with settlement worth $72 million. This ends Dauman’s 10-year reign as CEO, and officially brings Viacom’s Chief Operating Officer Thomas Dooley up to bat—on a temporary basis, at least. But what do the shareholders think? Shares have tanked over 50% in the last two years with Dauman under center, and have soared 40% since Dauman was ousted from the Viacom trust in May. You decide.
OTHER STORIES
ECONOMIC CALENDAR
RIO OLYMPICS: GREAT FOR THE U.S., NOT FOR NBC
American athletes had quite the Rio Olympics: the U.S. racked up the most medals (121) for a single country since 1988. On the other hand, NBC, which paid $12 billion for exclusive Olympics broadcast rights through 2032, isn’t feeling the vibes:
INTERVIEW QUESTION OF THE DAY
Using only a four minute and a seven minute hourglass, how would you measure exactly nine minutes? (Answer)
BUSINESS PERSON OF THE DAY
Urjit Patel – On Saturday, the Indian government named Patel as the new governor of the Reserve Bank of India. In the past, Patel ran the central bank’s monetary policy department and is credited with taming inflation and tackling India’s mountain of soured bank loans.
FOOD FOR THOUGHT
Mark Zuckerberg sold approximately 768,000 shares of Facebook stock in August, worth more than $95 million. Zuckerberg recently promised to give away or spend 99% of his wealth on companies and initiatives that focus on “personalized learning, curing disease, connecting people and building strong communities.”
