Business & Finance
Business and Finance
Business and Finance
Fri, June 25, 2010
Thu, June 24, 2010 JPMorgan Chase, HSBC Holdings, Citigroup, Royal Bank of Scotland and Raser Technologies
CHICAGO--([ BUSINESS WIRE ])--Zacks.com Analyst Blog features: JPMorgan Chase & Co. (NYSE: [ JPM ]), HSBC Holdings plc. (NYSE: [ HBC ]), Citigroup Inc. (NYSE: [ C ]), Royal Bank of Scotland Group plc (NYSE: [ RBS ]) and Raser Technologies Inc. (NYSE: [ RZ ]).
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Here are highlights from Wednesdaya™s Analyst Blog:
JPMorgan Reshuffles Top Brass
JPMorgan Chase & Co. (NYSE: [ JPM ]) announced Tuesday it is shuffling the positions of three top executives,in addition tocreatingthe new President of Internationalposition. This is part of the companya™s strategy to increase its presence in the international market.
JPMorgan named Ms. Heidi Miller, head of Treasury & Securities Services (TSS), as the President of International. While Mr. Michael Cavanagh, Chief Financial Officer (CFO). will succeed Ms. Miller as Chief Executive Officer (CEO) of TSS. Mr. Doug Braunstein, head of Investment Banking, Americas, will replace Mr. Cavanagh as CFO.
All these appointments are effective immediately and JPMorgan will soon announce the replacement of Mr. Braunstein as head of Investment Banking, Americas.
The role of the President of International will be to enhance JPMorgana™s lines of businesses globally, helping them to speed up, focus and prioritize their investments in faster growing economies, such as China, India, Brazil and Russia.
Ms. Millera™s role will comprise resourcing and governing lines of business, expanding local branches, seeking growth opportunities in other emerging economies and reducing inefficiency. She will be facing the pressure from recognized international peers such as HSBC Holdings plc. (NYSE: [ HBC ]) and Citigroup Inc. (NYSE: [ C ]) in wholesale banking and cash management. Ms. Miller will also be heading thenewly-created International Operating Committee, consisting of JPMorgana™s senior global leaders.
Mr. Cavanagh who has served as JPMorgana™s CFO since 2004 will look after TSS, one of the major business units of the company, for further expansion leading to increased revenue and profit.
Mr. Braunstein, who has now been appointed as CFO, will also be a member of JPMorgana™s International Operating Committee. He has occupied several senior Investment Banking positions in the company and has aided the company in theadvisory business. As a member of the Operation Committee, he will continue to focus on strengthening JPMorgana™s capital strength and liquidity, risk management, loan loss reserve and clear and transparent accounting.
JPMorgan has considerably increased its reach in the U.S. market during the financial turmoil, with the acquisitions of Bear Stearns and Washington Mutual. However, high capital requirements and tight regulations slowed the companya™s expansion plans, thus, raising the priority of the overseas market.
While expanding its geographic presence to enter emerging markets globally in the recent weeks, JPMorgan has announced its foray into the Chinese market through a joint venture with First Capital and proposed to acquire a Brazilian hedge fund, Gvea Investimentos. The company has also received the approval from theEuropean Union (EU) to acquire Royal Bank of Scotland Group plc's (NYSE: [ RBS ]) non-U.S. commodities joint venture RBS Sempra Commodities LLP for $1.7 billion.
These executive changes are a strategic move and are expected to help JPMorgan acquire more businesses in Asia and Europe, which are the main areas of further growth, as with its world class international business, the company believes that future growth prospects are outside U.S.
JPMorgan is currentlya Zacks #3 Rank (Hold), implying that the stock is expected to perform in line with the broader U.S. equity market over the next one to three months. While we anticipate continued synergies from the companya™s diversification and strong capital position, a pressured credit quality and reduced levels of client activity will drag down future earnings. However, we are impressed to see some improvement in credit quality during the last couple of quarters. Therefore, we maintain our Neutral recommendation on the stock.
Raser Tech Provides Project Update
Energy technology company Raser Technologies Inc. (NYSE: [ RZ ]) continues to progress with its Lightning Dock geothermal power plant project in New Mexico. The company started drilling on this 15 megawatt project in late May 2010.
The Renewables Energy Group of Raser Technologies has contracted Barbour Well Inc. of Henderson, Nevada for drilling wellsin its geothermal project near Lordsburg in southern New Mexico. Barbour is a Nevada-based firm licensed to drill geothermal and domestic water wells in New Mexico.
The drilling and initial operations at the well lasted for about ten days, followed by the test phase of the project, where a series of tests to determine water flow and temperature are performed. Rasera™s management believes the company is on track with the Lightning Dock project and looks forward to positive test results.
Following the success of the tests, the company is set to proceed with efforts to arrange funds for additional drilling to develop the well field for the project. Furthermore, the company expects to qualify for a 30% U.S. Treasury grant under the American Recovery and Reinvestment Act of 2009. Earlier this year, the company received a grant of $33 million from the U.S. Treasury for its Thermo No. 1, Utah project.
Provo, Utah-based Raser Technologies operates as a geothermal power development and technology licensing company in the United States. The company operates in two segments a" Power Systems, and Transportation and Industrial Technology. Going forward, the company expects to add 40MW annually to its geothermal capacity over the three-year period 2010a"2012 to take its total annual geothermal power generation capacity to 130MW.
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