Business & Finance
Business and Finance
Business and Finance
Wed, July 7, 2010
Tue, July 6, 2010 JPMorgan Chase, Royal Bank of Scotland, Sempra, ReneSola and Rite Aid
CHICAGO--([ BUSINESS WIRE ])--Zacks.com Analyst Blog features: JPMorgan Chase & Co. (NYSE: [ JPM ]), Royal Bank of Scotland Group plc (NYSE: [ RBS ]), Sempra Energy (NYSE: [ SRE ]), ReneSola Ltd. (NYSE: [ SOL ]) and Rite Aid Corp. (NYSE: [ RAD ]).
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Here are highlights from Fridaya™s Analyst Blog:
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JPMorgan Closes RBS-Sempra Deal
On Thursday, JPMorgan Chase & Co. (NYSE: [ JPM ]) announced the completion of its previously announced deal to buy Royal Bank of Scotland Group plc's (NYSE: [ RBS ]) non-U.S. commodities joint venture RBS-Sempra Commodities LLP. The final acquisition price was $1.6 billion.
The deal, which was announced by JPMorgan in February 2010, received the European Uniona™s (EU) approval in June 2010. The approval follows the Commissiona™s careful examination of the operations of both the companies.
According to the Commission's examination, there are limited horizontal overlaps between the operations of JPMorgan and RBS-Sempra. As a result, the deal would not obstruct effective competition in the operating area of the companies in Europe.
In order to comply with the European Union rules, RBS decided to sell its 51% stake in RBS-Sempra, which it jointly owns with Sempra Energy (NYSE: [ SRE ]). The step is also a part of RBSa™s restructuring efforts, which include selling non-core businesses in selected markets to shore up its financial resources.
Royal Bank of Scotland received state aid during the height of the financial crisis. As a result, it has to carry on with the interventions of the EU regulator.
The current merger is expected to create an integrated provider of both financial and physical trading services across the major commodity classes. Through this deal, JPMorgan has acquired RBS-Sempra Commodities' global oil, global metals, global coal, and European natural gas and power businesses.
ReneSola Provides Guidance
ReneSola Ltd. (NYSE: [ SOL ]) expects the positive trend to continue in to the second half of the year, riding on the back of strong demand.
Total solar products shipment is expected to be in the range of 600 MW to 650 MW. Net revenue is expected to be in the range of $500 million to $570 million. Gross margin is expected to be between 28% and 30%.
The Zacks Consensus Estimate for second-quarter 2010 is 25 cents per share, for 2010 it is 93 cents per share, and for 2011 it is 90 cents per share.
The bullish pre-view of ReneSolaa™s second-quarter results, handsomely exceeding the guidance on strong demand and better cost controls, looks reassuring. The market reacted positively to the information and the shares of ReneSola closed at $6.48 per share, up 8.5% from the previous daya™s close of $5.97 per share.
Rite Aid Sales Disappoint
Rite Aid Corp. (NYSE: [ RAD ]), one of the nationa™s leading drugstore chains, reported yet another month of disappointing same-store sales. After falling 1.7% in May 2010, same-store sales dropped further by 2.5% in June, marking the 13th consecutive month of negative sales trends since May 2009, when it had registered positive same-store sales of 0.6%.
For the month under review, Rite Aid posted sales of $1,908 million, down 3.3% from the year-ago quarter. Rite Aid hinted that the prescription revenue contributed 67.4% of drugstore sales, and third party prescription revenue accounted for 96.3% of pharmacy sales.
Rite Aid said that front-end same stores sales fell 1.1% in June 2010, reflecting an improvement over a decline of 3.6% in May. However, front-end same-store sales were weak compared to the combined March/April sales growth of 0.3%.
The company informed that pharmacy same-store sales dropped 3.1% in June 2010, after witnessing a marginal decline of 0.8% and 0.9% in the month of May and April, respectively. Rite Aid said that the introduction of new generic drugs hauled pharmacya™s June same-store sales by 157 basis points.
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