A humorous look at the companies that caught our eye, for better or worse, this week
You know when you’re trying out staple guns at Rona and you accidentally blast one into your crotch? Now you know how Rona’s long-suffering shareholders feel. Facing opposition from the Quebec government and a Rona board that wouldn’t play ball, U.S.-based Lowe’s withdrew its $14.50-a-share offer for the Canadian chain – removing what may have been the best hope to get the depressed shares to rise.
Businesses whose best days are behind them:
1) Rotary phone manufacturers;
2) Wagon wheel repair shops;
3) Department stores.
With U.S. shoppers hooked on discounts and coupons, J.C. Penney’s move to “everyday low pricing” was a disaster, prompting the retailer to bring back sales for some goods. But CEO Ron Johnson warned this week that the financial drag will linger in the second half, sending the stock to the bargain bin.
Research In Motion
Let’s see, RIM’s BlackBerry network in Europe and Africa goes down on the same day that Apple’s new iPhone 5 goes on sale. Either RIM has incredibly bad luck, or the ghost of Steve Jobs has been having a little fun. Whatever the case, RIM’s shares extended their gut-wrenching descent, plunging to lows not seen since 2003. Thank goodness BlackBerry 10 is coming next year. That’ll turn things around for sure.
Advanced Micro Devices
Why are shares of chip maker AMD getting slaughtered? Could it be that PC sales are falling? Or that AMD doesn’t make chips for the booming smartphone market and is only a bit player in tablets? Or that AMD’s revenue is expected to fall by double digits this year? Or that rival Intel is bigger and has better margins? Or that AMD’s CFO and former interim CEO resigned this week?
If it’s true that FedEx is a bellwether for the global economy, then one thing’s clear: We’re all in big trouble. The operator of the world’s biggest cargo airline cut its full-year profit forecast, citing a slowdown in exports from China because of the recession in Europe and sluggish growth in North America. The fact that companies are switching to cheaper, slower options such as ground and ocean shipping isn’t helping, either.