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Mastercard Manages to Beat Both Top and Bottom Line Estimates

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Mastercard News

Mastercard (NYSE:MA) just reported its third quarter earnings, announcing that increased revenues drove an increase in profits, exceeding both top and bottom-line estimates. The company’s shares have jumped 46% since the beginning of the year, more than double than 21% increase of Standard & Poor’s 500 index. And now, increased consumer spending is driving its revenues and profits despite the fact that its acquisition strategies are getting more costly, increasing expenses. But customers have clearly shaken off fears regarding a yet another economic downturn as they decided to spend more using their debit and credit cards, boosting revenue for the world’s second largest payment processor. In pre-market trading, Mastercard shares were up 1.5 percent yesterday, reaching $280.3.

Strong quarter results

Revenue amounted to $4.47 billion whereas Wall Street expected $4.42 billion, resulting in adjusted earnings per share were $2.15 beating the estimate of $2.01. During the same quarter last year, revenue came to $3.9 billion so that’s more than solid revenue growth.
The dollar value of all processed transactions came to $1.7 trillion, a 14% jump from last year’s quarter that amounted to $1.5 trillion. But more interestingly, despite the weakening US demand in September as retail sales dropped 0.3% during last month, domestic dollar volume still increased overall from $442 billion in the same quarter last year to $494 billion. The European segment also did well with a 16% increase from last year’s quarter, amounting to $507 billion. And consequently, net revenue increased 15% comparing to that quarter, but not only due to dollar volume but also due to an increase in cross-border volumes. Expenses also increased due to acquisitions but they ended up being lower than what the company expected so therefore, they are expected to incur in the next, last quarter of the fiscal year.

Competitors

Visa (NYSE:V) who Mastercard has been battling with for decades has also outperformed and ‘joined’ PayPal Holdings Inc (NASDAQ:PYPL) by reporting better than ‘feared’ earnings. It delivered a strong double-digit earnings and revenue growth, implying a similar guidance for 2020. Overall, investors seem encouraged with the company’s longer-term opportunities. So, both Visa’s and Mastercard’s earnings seem resilient to the economic downturn with their digital transactions competitor PayPal’s stock even popping after its faster than expected growth and by being the first foreign financial company that secured a place in the Chinese market pie. So, financial payment providers are doing great despite intense competition and the weakening macroeconomic surrounding.

Outlook

Although costly, acquisitions have not altered the company’s outlook for the year. The company is making efforts to enhance its cyber security as well as customer loyalty to join its rival Visa in offering more client-luring initiatives. Also, it is committed to expand its business relationships with HSBC Holdings Plc (NYSE:HSBC) and Bank of America (NYSE:BAC), among others, who are also investing heavily in safety as Bank of America revealed that they even created a position of an “Chief Brand Safety Officer”. So, the entire industry is taking security issues seriously and these solid quarter results surely show that Mastercard’s executive strategy is successfully guiding the company in this direction, despite a weakening global economy.

This article is contributed by IAMNewswire.com. It was written by an independently verified journalist and is not a press release. It should not be construed as investment advice.

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BenzingaEditorial

Disney’s Stock Hits Its New All-Time High With Even Roku Benefiting Its Disney+ Momentum

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Disney News

Shares of Disney (NYSE:DIS) were in breakout mode after reports surfaced about momentum in its Disney+ program. According to Apptopia, the momentum is nearing to 1 million subscribers per day. If true, expectations may still not be high enough for Disney+. November was surely quite a month for Disney as the iconic powerhouse couldn’t have asked for a better start of its streaming service debut! And there is never a dull moment nor a dull month when it comes to the House of Mouse.

Disney+ signups exceed expectations

The biggest new streaming service of 2019, Disney+, debuted on Nov. 12 and despite some initial difficulties on the technical front, it topped 10 million sign-ups on its very first day, free trials included. As a result of Apptopia’s reports suggesting stronger than even expected demand, its shares hit a new all-time-high last Tuesday.

December dates

Disney is about to make quite a bit of fireworks before Christmas. December 3, Disney is scheduled to add another special jewel to its vault: One Day at Disney. This special documentary follows 75 Disney cast members around the globe, during their typical day. Enabling its employees to tell their stories and giving meaning to their tasks is both a perfect HR and PR strategy to both elevate employees and enchant the audience. And it can surely further increase the appeal of the media giant. Next, on December 5th, Disneyland in California and Disney World in Florida are in for a high-tech and immersive game-changing addition. Although Disney World is somewhat better off, Disneyland has been struggling with year-over-year declines in attendance. Well, on Thursday, Star Wars addition will be welcoming visitors at Disney World so it will hopefully raise the bar as it will also join Disneyland next month. Otherwise, entry to Mickey’s world will only get more expensive. In other words, Star Wars: Rise of the Resistance cannot afford to fail visitors. And last but not least, and also Star Wars, The Rise of Skywalker premieres on December 20. Although no movie can please everyone, there are strong expectations to set box-office records for the franchise. And it needs to keep the audience’s interest for the next Starts Wars trilogy which is expected in 2022. And it could even affect Disney + since the company’s unique eco-system has shown a hit often sets everything else in motion.

The competitive landscape is getting more and more intense- but Roku triumphs!

As a consequence of Disney’s fame, Netflix Inc (NASDAQ:NFLX) is losing its loyal customers, but also due to raising prices for the second time since 2017. And there is also Apple’s (NASDAQ:AAPL) TV+ who just debuted as well and Amazon.com Inc’s (NASDAQ:AMZN) service bundle. Not to forget, AT&T Inc (NYSE:T) will launch its HBO Max in May next year and the telecom giant expects 50 million subscribers during the first five years, which are also bound to take a toll on Netflix. Netflix seems to be forced to drop its pricing or risk losing a lot of subscribers. But, the question of content is the one thing ‘money can’t buy’ and the one category in which Disney is the ultimate winner. But there’s the streaming pioneer Roku (NASDAQ:ROKU) which overcame fears that intense competition would dent its unique business model. Despite losing more than a third of its value when Apple announced its aggressive pricing strategy, it turned out that all these additions actually helped Roku, just like its management predicted. And Disney’s soaring demand also helped Roku grow. The strong demand for its app was an ‘unintended’ benefit making Roku the unintended beneficiary as Disney+ service was available to stream across Roku’s infrastructure of devices and ecosystems, so it was a win-win. Data shows that over the past 13 days that downloads of Roku apps jumped almost 30% in comparison to the previous 13-days period. And this is only a small addition comparing to the impressive growth Roku exhibited this year as it grew 54% in the first nine months of 2019 comparing to the same period last year. Its platform revenue grew at an even more impressive rate of 81% and active subscriber base expanded 36% year over year in the third quarter, reaching 32.3 million.

Outlook

Disney+ momentum is showing impressive results, but Disney has a lot of fronts to compete on. The House of Mouse is on a quest to defeat Netflix as the emperor of streaming as the company made a goal to achieve 60 million and 90 million subscribers by 2024. And despite some initial technical glitches that Disney says were due to heavy demand, it’s doing rather well considering it signed on 10 million subscribers within the first 24 hours of Disney+’ existence, but there’s no autopilot in this competitive landscape.

Meanwhile, Roku has shown it benefits from all this competition, and Disney+ was another plus for Roku, whose stock has gained more than 400% this year. And it seems that Roku’s business model is by far the fiercest one on the market, not to say the ‘bullet-proof’ unbeatable one as it’s going strong against headwinds and even benefiting from its so-called competitors!

This article is contributed by IAMNewswire.com. It was written by an independently verified journalist and is not a press release. It should not be construed as investment advice.

Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com

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BenzingaEditorial

Salesforce Might Have Quite a Few Surprises Up Its Sleeve

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Sales Force News

Salesforce.com Inc (NYSE:CRM) is set to report its third quarter financial results for the fiscal 2020 after the closing bell on Tuesday, December 3. There are solid fundamental indicators but its stock has struggled to keep up with the market. Its shares did go upward 18% this year but on the other side, they lagged behind the software industry which exhibited a 41% increase. But it seems that Salesforce has more than a few value-adding surprises up its sleeve which is why it expects to double its revenues by 2024.

Dreamforce Investor Day 2019

At this year’s conference, Salesforce CEO Marc Benioff stood in front of a screen that displayed major tech industry players around Salesforce: Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL), Amazon.com Inc’s AWS (NASDAQ:AMZN), Google (NASDAQ:GOOG), International Business Machines Corporation (NYSE:IBM), Hewlett Packard Enterprises Company (NYSE:HPE), Cisco Systems Inc (NASDAQ:CSCO), Dell (NYSE:DELL) and Alibaba Group Limited (NYSE:BABA). Benioff explained that Salesforce goal not to create boundaries but to work in a community as it partnered with all the major companies. And Salesforce is showing it can be unifying centre between and across all these technologies!

Competitors

Salesforce has already played the multi-cloud game. Last week, it announced that its Marketing Cloud will make use of Microsoft’s Azure. This was quite a surprise considering the two companies are fierce CRM competitors! In July, the company made a deal with Alibaba to extend its services in China. Back in 2017, also at Dreamforce Investor Day, the company announced a partnership with Google Cloud, as it named as its preferred cloud provider for international expansion. Back in 2016, it made Amazon Web Services as its preferred infrastructure vendor but the 4th year contract is nearing its end date, so the company is playing it safe to be in the multi-cloud business regardless of its renewal. And it developed Trailhead Go for Apple’s iPhones and iPads, so it’s pretty much everywhere.

Fiscal year results

This year the company is expected to generate $17 billion in revenue for its whole fiscal year. Moreover, it expects its revenue to be in the range of $34 billion and $35 billion by 2024, which is an impressive growth rate of about 20% annually. But management announced that the acquisition of MuleSoft was finally starting to come together. But the consequence of all those acquisitions is that after accounting for expenses, the company not generating as much profit, compared to its market peers. But the last time the CRM provider issued quarter earnings was in August with $0.66 EPS, beating the Zacks’ consensus estimate of $0.09, net margin of 6.45%, a return on equity of 7.26%, with revenue amounting to $4 billion, also exceeding analysts’ expectations of $3.96 billion.

The company is pushing its Customer 360 as a platform that is able to bring all the clouds together as this is what customers want: a simple solution which can bear it all. Customer 360 promises to be ‘a single source of truth’ for customer data, no matter where the data resides, and that is no easy task.

Outlook

The projections that Salesforce shared were definitely encouraging. The 26% and 25% revenue growth rates in fiscal 2019 and 2018, respectively, are a proof of the company’s ability to deliver on its new target. But to drive this revenue growth, the company has made a series of acquisitions that weighted on its margins. The company also has stakes in other companies like Dropbox (NASDAQ:DBX) through which it expanded its reach in the tech industry. So overall, it is no surprise that analyst estimates are in line with Salesforce’s new 2024 predictions.

This article is contributed by IAMNewswire.com. It was written by an independently verified journalist and is not a press release. It should not be construed as investment advice.

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BenzingaEditorial

Guess Is Far From Being a Fashionable Stock But It At Least Reported a Profit

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Guess News

Guess Inc (NYSE:GES) released its earnings report after the market closed on Tuesday, November 26th. The shares of Guess’, Inc. have decreased 8 percent this year alone. But after reporting a loss in the comparable quarter last year, the Los Angeles-based company just reported a net income of $12.4 million resulting in 18 cents per share. Shares were slightly up, 1.15 percent to be exact, after third quarter EPS exceeded even the highest analyst estimate.

Third quarter

Revenue amounted to $615.9 million in the period, increasing 1.7% but missing estimates as analysts expected $620 million. Adjusted earnings increased from 13 cents to 22 cents a share. The company operates directly via 1174 stores in America, Europe and Asia as of November 2. Revenues of these segment revenues changed as follows comparing to last year: Americas Retail dropped 5%, while Americas Wholesale climbed 7%. Europe also increased 9% remaining as the company’s bright spot but Asia dropped 8% in US dollars.

The company recorded adjusted net earnings of 14.9 million dollars, which is a 41.2 percent increase from the comparable quarter of the previous fiscal year.

Overall, the clothing company expects full-year unadjusted earnings of $1.20-$1.25 per share and adjusted earnings in the range of $1.31-$1.36 per share. Consolidated net revenues are expected to increase 2.7-3% in fiscal 2020.

Challenged industry

Tariffs placed on almost 90% of Chinese clothing and textile imports by the Trump administration have been posing a significant challenge for apparel stocks throughout the year. But savvy industry players continue to win over shoppers by refining their marketing strategies, forming strategic alliances, and enhancing their digital footprint. Apparel companies with international exposure are also finding opportunities in unsaturated markets like Asia and Europe to boost sales growth.

The whole sector is struggling- but some manage to remain at the forefront

Some of these fashion apparel companies that have taken proactive steps to ensure that they remain at the industry’s forefront is the $7.73 billion New York-based Ralph Lauren Corporation (NYSE:RL) present in America, Europe, and Asia. It owns well-known brands including Polo Ralph Lauren, Lauren Ralph Lauren, Chaps, and Club Monaco. To attract younger buyers, the firm has boosted its marketing investment by 18% in fiscal 2019 compared with last year and plans to increase that budget to 5% of total sales. Recently, the company has worked with social media-savvy celebrities that helped sell its products. The fashion retailer’s shares dropped roughly 37% between May and August, but price has rallied 24% from its August low and the stock continues to show increased momentum. So, Ralph Laurent’s strategy is starting to paying off as it gains attractive attention from investors.

Outlook

Guess’, Inc. is an apparel giant that markets and licenses lifestyle collections of apparel and accessories for men, women, and children. Its iconic fashion brands such as Guess, Marciano, and G by Guess are sold through wholesale channels, retail outlets, and online. Growth efforts in the company’s brightest spot, Europe, include optimizing distribution networks and improving efficiency in sourcing and product development. Management is pleased with the results that show operating earnings and earnings per share for the period above the high-end of expectations while raising the low end of the guidance for the full year. But Guess’ management has more tweaking work to do on its agenda in order to engage customers of today and tomorrow. Such initiatives, if effective, will surely help to offset the increasing expenses and weakening macroeconomic effects.

This article is contributed by IAMNewswire.com. It was written by an independently verified journalist and is not a press release. It should not be construed as investment advice.

Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com

Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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