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With the growing adoption of electronic payments in emerging markets, global issuance of payment cards is projected to grow 36% to 18.3 billion during 2011-2016.
PayPal Holdings, Inc.
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(Bloomberg) -- Explore what’s moving the global economy in the new season of the Stephanomics podcast. Subscribe via Apple Podcast, Spotify or Pocket Cast.How businesses can adapt to the new world of heightened political risks and cutting-edge technologies were key themes of discussion on the second day of the Bloomberg New Economy Forum in Beijing.“The biggest risk in 2020 is the relationship between the major trading powers and economies of the world,” Gary Cohn, former Goldman Sachs Group Inc. president and former director of the Trump administration’s National Economic Council, said on the forum’s sidelines.If the world continues to fracture rather than working together, the global economy will suffer, said Cohn. “We need each other to grow.”In a nod to the tensions over the race to dominate 5G technology, Li Zixue, chairman and executive director of ZTE Corp., said tensions over national security will be inevitable as it is rolled out. But he also sought to downplay the differences.“The 5G network will certainly give rise to more complex and more severe security issues,” he said. “Personally, I believe these problems will be solved.”Still, Diana Choyleva, chief economist at London-based Enodo Economics, reckons there’s only a 5% chance of the two superpowers agreeing on technology standards.On Europe, former U.K. Chancellor of the Exchequer Phillip Hammond said the worst outcome for his country’s December election would be a “a very small Tory majority government” where Prime Minister Boris Johnson would be “captive” to hard-liners. If that’s not bad enough, he also warned that Labour leader Jeremy Corbyn’s policies would be an “economic disaster.”Here’s a selection of remarks from some of those present:DecouplingAs a carry-over from the forum’s first day, participants worried about a world where the U.S. and China build separate systems for trade and technology.“Oh my God, it is so radical an idea to decouple,” Scott Kennedy, an expert on the U.S.-China economic relationship at the Center for Strategic and International Studies in Washington, said on Bloomberg Television.The bar for “crazy” has moved from deterrence, anti-dumping and countervailing duties, to sanctions, and “now we are talking, ‘let’s rip these two economies apart,”’ which is “nuts,” Kennedy said.Also pleading for more engagement between the two economies, and globally, was Susan Shirk, research professor and chair of the 21st Century China Center at the University of California San Diego and a former U.S. deputy assistant secretary of state.“I believe that China is overreaching and America is overreacting and it creates a really dangerous dynamic,” Shirk said on Bloomberg Television. She recalled former U.S. Secretary of State Henry Kissinger’s remarks from the forum’s first day, and called for more “clear thinking in the U.S.”Deal or No DealWhile corporate and political leaders mulled the way forward over the long-term, they also discussed how business must go on, divorced from the daily trade-war headlines.Firms are “having to constantly adapt, and they can’t wait for political resolution” on Brexit or U.S.-China trade battles, said HSBC Holdings Plc interim Chief Executive Noel Quinn.Michael Froman, Mastercard Inc. vice chairman and former U.S. trade representative, called the phase-one deal “largely a purchase deal,” and “the easy piece.” He echoed others at the forum in saying the real issue is how do the two countries accommodate each other when they are following different rules.Froman warned that if China continues to part ways from U.S.-style industrial policy, “it will not be surprising to see opposition in the U.S. and Europe and elsewhere given the distorted effect on international trade. The question is: How do we move to a common set of rules?”Tech WarsBeyond tariffs, analysts and business leaders mulled how to ensure that potential bifurcation in technology doesn’t hamper innovation.Ian Bremmer, founder and president of Eurasia Group, told Bloomberg Television’s Haslinda Amin that while some U.S.-China decoupling already is underway, there are still questions over which countries will choose sides around a “virtual Berlin wall,” and “how high the wall is.”“The level of trust has all but gone away” and while “the United States will continue to innovate on its own, and of course China will innovate on its own,” so many big global initiatives require collaboration, said Jerry Yang, co-founder of Yahoo and founding partner of AME Cloud Ventures.“What we need is a strategy for tech engagement in China, and it’s time to have that conversation,” said Samm Sacks, a fellow on cybersecurity policy and China digital economy at the Washington-based New America Foundation.We’ll end this on something of an optimistic note.“Artificial intelligence is not the thing you see in the movies,” said Eric Schmidt, Google’s former chief executive officer and currently a top technical adviser to the Pentagon. “It’s going to revolutionize health care. That’s going to be better done by computers, advising the doctor: the doctor will make the decision.”The New Economy Forum is being organized by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News.\--With assistance from Kristine Servando.To contact the reporters on this story: Michelle Jamrisko in Singapore at email@example.com;Enda Curran in hong kong at firstname.lastname@example.orgTo contact the editors responsible for this story: Malcolm Scott at email@example.com, Adrian KennedyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- PayPal Holdings Inc. fell as much as 1.9% early Thursday after the payments company said it will acquire online coupon site Honey Science Corp. for about $4 billion, its largest-ever acquisition. Some analysts praised the deal’s strategy and growth potential, but others flagged the steep price and wondered whether Honey was the best M&A target for PayPal.Here’s a sample of the latest commentary:SunTrust, Andrew JeffreyJeffrey in a note recommended that investors stay on the sidelines as “this is not the deal PayPal needs to secure its position among premium valued network stocks.”Instead, SunTrust views Honey as a “sort of ‘shoot-the-moon’ attempt to more deeply entrench PayPal in the consumer e-commerce experience while also bolstering its merchant value proposition. Unfortunately for investors, the company is paying a large premium, in our opinion, for an unproven solution which does little to advance its ability to monetize beyond e-commerce.”Though PayPal can probably “elegantly integrate Honey into its core app and Venmo,” it may not “significantly advance the company’s market share amid rising competition,” he said. The deal also “does nothing to extend PayPal’s physical world reach, where 85%-plus of all transaction volume occurs.” Jeffrey did flag one positive: Honey is a small acquisition relative to PayPal’s market cap, which may limit downside risk. He rates shares hold, with a price target of $105.Raymond James, John Davis“While the strategic rationale makes a great deal of sense as it touches both the consumer and merchant side of PayPal’s platform and the cross sell opportunities are significant, it certainly didn’t come cheap,” Davis wrote. “Any way you slice it, $4 billion is a lot to pay for a company making little to no money.” Rates shares outperform, with a target price of $122.MoffettNathanson, Lisa EllisThe acquisition is “strategically attractive” for PayPal, as it’s imperative for the firm to strengthen its network by enhancing merchant and consumer value propositions as the “wallet wars” wage on, Ellis wrote in a note.Buying Honey is “well aligned with this critical strategic priority,” as Honey’s tools will strengthen PayPal’s suite of merchant services while integrating Honey’s services into PayPal and Venmo apps will boost consumer engagement, she said.Ellis views the $4 billion price as “consistent with comps for other small, high growth firms in payments and tech,” like PayPal’s iZettle deal. She rates shares buy, with a target price of $135.BofA, Jason KupferbergKupferberg views the deal as “strategically compelling” as PayPal can leverage the high-growth asset to “generate meaningful revenue synergies over time.” That’s even as the $4 billion value “represents a steep revenue multiple,” he said.The purchase also “represents a new breed of acquisition,” he added, as PayPal has in the past mostly acquired payments companies but now seeks to go “deeper into the e-commerce ecosystem by moving up to the front-end of the shopping experience as opposed to being on the back-end at checkout.” He flagged that Honey is working with 30,000 merchants including Expedia, Macy’s, Priceline and Sephora.Kupferberg expects PayPal will update its outlook on its fourth-quarter earnings call in January to include Honey. He doesn’t see the proposed deal changing the company’s capital allocation policy, as PayPal “has the balance sheet flexibility for continued share repurchases and additional M&A.” Keeps buy rating, target $127.(Updates share trading in first paragraph.)To contact the reporter on this story: Felice Maranz in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Catherine Larkin at email@example.com, Steven Fromm, Janet FreundFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Euronet Worldwide (EEFT) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.
FleetCor's (FLT) top line continues to grow organically driven by increase in volume and revenue per transaction in certain of its payment programs.
(Bloomberg) -- PayPal Holdings Inc. will acquire Honey Science Corp. for about $4 billion, its largest-ever acquisition, adding a startup that amasses valuable data on consumer buying habits and doles out coupons for online bargains.About 17 million people use Honey apps or web browser extensions to find discounts at online shopping sites. The startup was profitable in 2018, PayPal said in a statement. Shares of the payments giant were little changed in extended trading.Honey is valued at almost twice what PayPal paid for its next-largest deal, iZettle, the Swedish provider of small-business services it purchased in 2018, and marks the first major acquisition this year. Chief Executive Officer Dan Schulman has signaled that PayPal, with more than $10 billion in cash, is on the hunt for more deals after a string of takeovers last year that included Hyperwallet and Simility.“You can expect us to be acquisitive going forward,” Schulman said on a conference call with analysts this summer. PayPal looks at hundreds of potential deals every quarter and sees them as a way to expand globally and accelerate development of new products, he said. Schulman described acquisitions as “a part of who we are on an ongoing basis.”Honey, which was founded in 2012, will keep its base in Los Angeles, and the founders will continue to run the business. The company’s services include a browser extension that automatically applies coupons at e-commerce sites. In a statement, PayPal said that Honey’s capabilities will give its customers a better shopping experience, and help merchants drive sales, partly with more timely and personalized offers.Mark Palmer, an analyst at BTIG, said the acquisition would help PayPal make “significant advances” toward becoming more relevant to users. It could also give customers and merchants a reason to choose PayPal “in the face of increasing competition from tech companies, such as Facebook Pay.”As a shopping-focused browser extension, Honey has access to large amounts of customer data. Lisa Ellis, an analyst at MoffettNathanson, said that PayPal typically uses that information for purposes like fraud prevention. She added that if there were to be a privacy issue over data at the combined company that limited its use, some abilities, like targeted offers, could be curtailed.(Updates with Honey details starting in the fifth paragraph.)To contact the reporter on this story: Julie Verhage in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Mark Milian at email@example.com, ;Tom Giles at firstname.lastname@example.org, Anne VanderMeyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Interpublic's (IPG) digital capabilities, diverse business model and geographic reach provide distinctive competitive advantage. However, high debt remains a concern.
The dual tailwinds of renewed trade optimism and stronger-than-expected corporate earnings drove the rally. The bullishness was further fueled by rate cuts by the Federal Reserve.
Mastercard moved past a 282.34 early entry. It's like a handle but technically this is a flat base with a 293.79 conventional entry. Visa topped a buy point.