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Hedge Fund News Wrap: Week Ending 9/25/15

Fri, 25 Sep 2015 10:36:59 GMT

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(Business Insider) – As the search for a new CEO continues, shares of Twitter are feeling the ripple effect. On Thursday, the stock fell by 5%, officially falling below its initial public offering price. The occurrence took place after Citi analysts lowered their price target from $37 to $30 and downgraded the light blue bird to “neutral/high risk.”

“We rate Twitter High Risk because its high multiple (23x CY16 EBITDA) creates risk for significant multiple compression,” said Citi’s Mark May. “In addition, Twitter’s shares have proven to be especially volatile relative to other Internet stocks.”

The past year has not been too friendly to Twitter, as it has been 100+ days into the search for a new CEO and it has fallen 50% over the last year. Maybe the company needs more than 140 characters to regain momentum.

Read the entire article at Business Insider
More coverage: Investor Place and USA Today

Sprint CEO Hints At Cable Company Merger

(Wall Street Observer) – Marcelo Claure, Sprint Corp CEO, recently teased investors by hinting at a merger with a cable company. In an ever-changing world where more and more devices are going wireless, it is not surprise that the wireless company is looking to expand.

In a recent interview with Reuters, Claure stated, “It seems like everybody now wants to get into wireless, which puts Sprint in a very good position. So I think the next few months or years are going to be very active in this industry. I think it’s going to be exciting times ahead in terms of consolidation, but we don’t have any conversations with anybody.”

By forming a merger, Spring would have a “quad-play” available for consumers, which includes fixed and mobile telephony, internet and television services. Comparable to Sprint, several companies have been mingling in and out of different tech spaces, like Altice purchasing Cablevision just a short time ago.

Read the entire article at Wall Street Observer
More coverage: Business Insider and RCR Wireless News

Jetta, Passat, Diesel, Oh My!

(Wall Street Journal) – Environmentally conscious people are shaking their fists this week after Volkswagen, the German car manufacturer, cheated on about 11 million tests. So it looks like VW will be sitting in detention with its tail between its legs for a while.

This nightmare began after researchers at West Virginia University and the International Council on Clean Transportation published their findings that included “significantly higher in-use emissions” in certain VW models. After news regarding the scandal erupted, rumors began to fly and stocks plummeted. On Monday alone, almost $17 billion was wiped off VW’s share price, with fines adding up to almost $18 million.

At this point, the consequences are immeasurable, but will unravel as time goes on. So far, the CEO has stepped down and a new one is in the works as VW goes in crisis mode.

Read the entire article at Wall Street Journal
More coverage: and CNBC

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