Author Archives: Scalper1

Facebook Tries To Quell Twitter Firestorm Over India

Facebook ( FB ) founder Mark Zuckerberg found himself in the awkward position of responding to tweets by company board member Marc Andreessen about India that Andreessen later deleted, with apologies to an upset audience. “I want to respond to Marc Andreessen’s comments about India yesterday,” Zuckerberg wrote on his Facebook page . “I found the comments deeply upsetting, and they do not represent the way Facebook or I think at all.” Andreessen, a high-profile Silicon Valley venture capitalist and active user of Twitter ( TWTR ), apologized Wednesday for tweets that attacked the Indian government for banning Facebook’s free Internet service in that country and referred to India’s past colonial rule. On Monday, India’s Telecom Regulatory Authority ruled that Facebook’s Free Basics and other similar services are illegal for various reasons. Entrepreneurs in India had criticized the service, saying it positioned Facebook as a gatekeeper to the Web and fearing being left at a competitive disadvantage. The Free Basics service provides free but limited Internet service on mobile devices. The service is available to about 1 billion people across Asia, Africa and Latin America, designed to “bring more people online and help improve their lives,” Facebook says. It’s part of Facebook’s Internet.org initiative that, according to Zuckerberg, has provided Internet access to 19 million people in 38 countries. The decision by India to block Free Basics sent Andreessen into a tizzy. “Denying world’s poorest free partial Internet connectivity when today they have none, for ideological reasons, strikes me as morally wrong,” he tweeted. He added, “Anti-colonialism has been economically catastrophic for the Indian people for decades. Why stop now?” Zuckerberg Response Gentler Twitter users blasted Andreessen for the comments, which he deleted. “I apologize for any offense my comment caused, and withdraw it in full and without reservation,” Andreessen wrote. “I will leave all future commentary on all of these topics to people with more knowledge and experience than me.” On Monday, Zuckerberg had responded to India’s ban, but in a gentler way. “While we’re disappointed with today’s decision, I want to personally communicate that we are committed to keep working to break down barriers to connectivity in India and around the world,” he wrote on a Facebook post. “Connecting India is an important goal we won’t give up on, because more than a billion people in India don’t have access to the internet.” Facebook is not alone in trying to expand Internet access to poor regions of the world.  Alphabet ( GOOGL ) is the founder of Project Loon , a research and development project with a goal to bring Internet access to rural and remote areas using a global network of high-altitude balloons. Alphabet plans to create a network of balloons traveling on the edge of space, designed to connect people all over. Facebook’s Internet.org, in addition to working with regional mobile-service providers, is also researching the use of unmanned aircraft for providing Internet access.

Expedia Rises As Analysts Like HomeAway, Orbitz Acquisitions

Expedia ( EXPE ) stock vaulted Thursday, though the company late Wednesday posted Q4 results below expectations. Still, it performed better than the worst fears and saw bookings jump, thanks to a pair of big acquisitions. Expedia stock was up 9% in early afternoon trading on the stock market today , near 103. Expedia partner TripAdvisor ( TRIP ) saw its stock jump 16% Thursday afternoon, after that company reported a Q4 earnings beat before the open. Shares of rival Priceline ( PCLN ) were up 1.5% in afternoon trading. Expedia gave 2016 guidance for EBITDA, or earnings before interest, taxes, depreciation and amortization, which met Wall Street views. Some analysts, though, like its prospects. The growing benefits of Expedia’s recent acquisitions Orbitz and HomeAway are encouraging, RBC Capital Markets analyst Mark Mahaney said in a research note. He cited executives’ commentary on the acquisitions’ momentum and added that he trusts Expedia’s CEO to tell it like it is. “Expedia has emerged as an excellent play on the secular growth in online travel and as a strong integrator of assets,” Mahaney wrote. “Its growth rate outlook and fundamental position have become very comparable to industry leader Priceline, which we also recommend as a stock.” Jefferies analyst Brian Fitzgerald wrote in a research note that the two acquisitions added 28% to booking growth and 19% to sales growth, though he says that they will likely squeeze profit margins for the foreseeable future as Expedia integrates both firms. On the company’s earnings conference call with analysts late Wednesday, Expedia CEO Dara Khosrowshahi said that HomeAway will operate as a separate business while Orbitz is integrated into Expedia’s “technology stack.” Cowen analyst Kevin Kopelman called Q4 results “solid” and reiterated his price target of 135. Macroeconomic Fears Unfounded, For Now The slower economy is an overhang that Expedia seems to be weathering, analyst Mahaney said. “The market has assumed a boat tossed on the violent macro(economic) seas, but we see steady sailing,” Mahaney wrote. On the call, Khosrowshahi said that Expedia has thus far not experienced material macroeconomic effects. Mahaney said that he believes him. Khosrowshahi “was the most vocal and honest Internet CEO during the 2007-08 recession when it came to calling dramatic macro (he called it ‘a dog’s breakfast’ at the time),” Mahaney wrote. “So he has cred with us. And he should with you.” On the call, Khosrowshahi said that the terrorist attacks in Paris cost the company $10 million to $15 million in sales. Foreign exchange also had an impact. “One thing I will remind you as far as the core business is that foreign exchange was a really, really significant headwind last year,” Khosrowshahi said. Despite Mahaney’s positive view, he lowered his price target on Expedia stock to 180 to 160. Expedia and Priceline could consolidate their online travel lead in 2016, some analysts say. “Looking at online travel, we’re getting to the point of relative maturity; it’s no longer an early-stage category,” Guggenheim analyst Jake Fuller told IBD in December. “Thirty-eight percent of total travel is sold online.”

PC Market Slump Drags On HP Ahead Of Fiscal Q1 Report

Personal computer and printer maker HP Inc. ( HPQ ) continues to slump on diminished prospects for the PC market in 2016. HP stock on Thursday fell to its lowest level since it split from the former Hewlett-Packard on Nov. 1. HP shares were down 3% near 9 in afternoon trading on the stock market today . Earlier in the session, the stock fell as low as 8.92. HP had climbed as high as 14.82 post-split. RBC Capital Markets analyst Amit Daryanani on Thursday maintained his sector perform rating on HP stock but cut his price target to 11 from 13. He also lowered his estimates for HP’s fiscal 2016 “to reflect weaker market fundamentals.” “Recent PC-centric data points suggest to us that not just demand is soft, but there is also a continued PC inventory overhang, especially in Europe, that could negatively impact results in first half 2016,” Daryanani said in a report. “Similarly, we think both the print hardware and supplies businesses could have muted outlooks for fiscal 2016, based on Canon ( CAJ ) results/outlook and (foreign-exchange) movement.” HP is scheduled to report fiscal-first-quarter results after the market close on Feb. 24. HP executives have said the PC market will be challenging for several quarters but had expressed optimism for the second half of 2016. They had hoped Microsoft ’s ( MSFT ) Windows 10 operating system would help drive PC sales, particularly with enterprise customers, later in the year. “HP should see challenging growth dynamics through fiscal 2016 on foreign-currency translation headwinds, competitive industry pricing, and PC channel inventory issues,” Daryanani said. On Wednesday, Sterne Agee CRT analyst Rob Cihra reiterated his neutral rating on HP stock but cut his price target to 11 from 14. “While global PC demand remains weak and supply/demand negative starting calendar 2016, we actually believe HP’s PC inventories are in better shape than most, an ironic product of its weaker share in China,” Cihra said in a report. “But we still see a particularly weak start to the year.” Cihra is forecasting the PC market will unit declines of about 5% year over year in 2016, but HP could offset the industry decline through market share gains as the top-tier players continue to consolidate. The cash-cow printing business looks even weaker than PCs this year, Cihra said. On Tuesday, Pacific Crest Securities analyst Brent Bracelin maintained his sector weight rating on HP stock but lowered his estimates for HP for this year and next based on “eroding PC and printing fundamentals.” RELATED: Apple Bucks Declining PC Sales Trend HP Inc. Q4 Earnings Exposes Dark Side Of PC business .