UBS - Wall Street Breakfast Podcast: Philips Rises Revenue Beat

2023-04-24 07:04:31 ET

Listen on the go! Subscribe to Wall Street Breakfast on Apple Podcasts and Spotify Philips ( PHG ) stock rises ~10% as Q1 earnings grow , €575M provision for recall suit (00:40). Outflows at Credit Suisse ( CS ) reached $69B in Q1 and are still going (01:56). Silver Lake to launch $2.42B public takeover offer for Software AG ( STWRY ) backed by Software AG Foundation (07:20). Learn more about these stocks with Seeking Alpha Premium .

This is an abridged transcript of the podcast.

• The Philips stock is on the rise premarket. The stock is up 11 percent as Q1 profits beat estimates.

• Credit Suisse reported earnings premarket. Outflows at Credit Suisse reached $69B in Q1 and are still going.

• Johnson and Johnson is expected to launch its IPO roadshow for its consumer healthcare unit. Kenvue is expected to be listed under the ticker symbol KVUE.

OUR TOP STORY

Philips (NYSE: PHG ) is up 11% premarket after Q1 results beat estimates as supply chain issues improved and the company's restructuring actions started to take effect.

Adjusted income from continuing operations attributable to shareholders rose +46.67% Y/Y.

Group sales increased +6.36% Y/Y. The company said comparable sales grew by 6%, driven by continued supply chain improvements.

Philips CEO Roy Jakobs said the company has “reduced the workforce by approximately 5,400 roles out of the planned reduction of 10,000 roles globally."

The company also reported that it set aside 575M euros for litigation related to the Respironics recall.

The most recent article on Philips is by The Wolf Report. The Wolf Report is an investing groups leader for iReit on Alpha.

The Article is entitled “Philips: A Massive Upside, I Say Buy.”

In the article they says the company is a buy because it’s overall qualitative, it’s fundamentally safe and well run and it’s currently cheap.

I’ll leave a link to the article in show notes.

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Credit Suisse (NYSE: CS ) has revealed more details about what happened to the troubled bank before regulators worked out a deal for the institution to be swallowed by Swiss rival UBS (NYSE: UBS ).

Fears of a global banking crisis saw the lender suffer $68.6B of asset outflows in the first quarter, according to its Q1 earnings report, and while the outflows have since stabilized to much lower levels, they "had not yet reversed as of April 24, 2023."

Credit Suisse ( CS ) posted a one-off $14B profit for the quarter due to the $17B writeoff of AT1 bonds in its controversial emergency rescue. Without it, the bank would have lost more than $2B.

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Today is catalyst watch monday.

Seeking Alpha senior managing news editor Kim Khan says even though fed speakers are in a blackout period, there’s still a lot to capture our attention.

*audio from Kim Khan*

And of course we can’t forget about earnings…

*audio from Kevin Curran*

That was Seeking Alpha associate news editor Kevin Curran.

NOW MORE ON THE MARKET

Wall Street finished an uncertain week with a flat performance on Friday, as investors geared up for key earnings reports due out this week. Each of the major U.S. equity averages managed to eke out a thin gain.

The Nasdaq ( COMP.IND ) closed +0.1%, the S&P 500 ( SP500 ) finished +0.1% and the Dow ( DJI ) ended +0.1%.

Six of the 11 S&P sectors recorded gains. Consumer Discretionary rose 1.2%, with modest gains coming from Health Care and Consumer Staples. Meanwhile, Materials and Energy were among the day's laggards.

MORE OF OUR TOP STORIES

Comcast (NASDAQ: CMCSA ) said Sunday that Jeff Shell, CEO of NBCUniversal, will leave the company , effective immediately, after a company investigated a complaint of "inappropriate conduct."

Comcast says this was a mutual decision.

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Bed Bath & Beyond (NASDAQ: BBBY ) has filed for Chapter 11 bankruptcy protection.

BBBY said it plans to keep its 360 Bed Bath & Beyond stores and 120 Buy Buy Baby shops and the two brands’ Websites operating for now, but that they will soon begin efforts to close those stores.

However, Bed Bath & Beyond ( BBBY ) said that if it successfully auctions off one or both brands through the bankruptcy process, the company "will pivot” away from any store closings.

BBBY added that it has secured a commitment for some $240M in debtor-in-possession financing from Sixth Street Specialty Lending Inc. for use during the Chapter 11 process. The company listed $5.2B of debts and $4.4B of assets in its filing.

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Johnson & Johnson (NYSE: JNJ ) is expected to begin a roadshow to pitch shares of its consumer-healthcare spinoff, Kenvue, as early as Monday,

According to The Wall Street Journal citing people familiar with the matter Kenvue plans to start meeting prospective investors to raise $3.5B or more from the IPO, which can value the firm at approximately $40B.

Companies typically hold IPO roadshows, lasting from a few days to a week before a public debut.

If JNJ succeeds in its plans for the listing, Kenvue’s stock is expected to trade on the New York Stock Exchange under the ticker symbol KVUE.

In 2021, JNJ ( JNJ ) announced plans to separate its consumer unit that houses household brands such as Tylenol and Band-Aids from its pharmaceutical and medical-device businesses.

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Silver Lake is acquiring Software AG ( OTCQX:STWRY ) for ~$2.42B.

The deal values Software AG at €30/share, representing a premium of 53% to Software AG's closing price of €19.59 on Thursday.

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Now let’s take a look at the markets as of 6:20 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are pointing lower. The Dow is down 0.2%. The S&P 500 is down 0.1% and the Nasdaq is also down 0.1%. Crude oil is down 0.5% at more than $77 a barrel. Bitcoin is down 0.7% at $27,350.

In the world markets, the FTSE 100 is down 0.1% and the Dax is up 0.2%.

On today’s economic calendar, at 8:30am the Chicago Fed National Activity Index and at 10:30 am Dallas Fed Manufacturing Survey.

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