Daily Stock Updates: AT&T Inc. (T), Time Warner (TWX), Microsoft Corporation (MSFT), Reynolds American, Inc. (RAI), Honeywell (HON)
There was no economic news today. There also haven’t been any new polls that can tell us if the initial 3 tracking polls which show the election tied are correct.
The big news is the AT&T Inc. (NYSE:T) purchase of Time Warner Inc (NYSE:TWX) which is probably a bad move. Time Warner’s business is lumpy which adds risk to AT&T’s consistent business. It’s tough to say how this vertical integration provides much synergies. These bizarre deals are what tend to happen at market peaks.
Microsoft Corporation (NASDAQ:MSFT) reported Q1 EPS of 76 cents which beat estimates 8 cents. Revenues were $22.3 billion which was an increase of 3.0% and beat estimates by $590 million. Productivity and Business Processes revenue increased 6%. Intelligent cloud revenues increased 8%. Within that segment Azure grew revenues by 116%. Revenues in more personal computing declined 2%. CEO Satya Nadella stated “We are helping to lead a profound digital transformation for customers, infusing intelligence across all of our platforms and experiences. We continue to innovate, grow engagement, and build our total addressable market.”
British American Tobacco offered to buy the 58% in Reynolds American, Inc. (NYSE:RAI) it doesn’t own for $47 billion cash and shares. British American Tobacco’s proposal is worth $56.50 or 20% above Reynolds’ closing price. British American Tobacco will pay $20 billion in cash and the rest in stock.
Honeywell International Inc. (NYSE:HON) reported Q3 adjusted EPS of $1.67 which missed estimates by 1 cent. GAAP EPS of $1.60 was in-line with estimates. Revenues of $9.8 billion were up 2% and beat estimates by $20 million. The business was hurt by weakness in aerospace in September. Q3 organic aerospace revenue fell 6% to $3.6 billion because of impact of sales incentives, weakness in business jets and commercial helicopters, and the competition of space and defense programs. It expects Q4 sales to fall 7%-9% due to weakness in business jets, defense and space areas.