Facebook CEO Mark Zuckerberg arrives to testify before a joint hearing of the US Senate Commerce, Science and Transportation Committee and Senate Judiciary Committee on Capitol Hill, April 10, 2018 in Washington, DC.
Jim Watson | AFP | Getty Images
A bipartisan team of senators introduced a bill Monday that would require social media companies to disclose more information about the data they collect and monetize from their consumers.
The DASHBOARD Act, which stands for “Designing Accounting Safeguards to Help Broaden Oversight And Regulations on Data,” aims to help consumers understand the price of using social media services that are free on face value. The bill will require “commercial data operators” with more than 100 million monthly active users to disclose the type of data they collect from users and give them “an assessment of the value of that data,” according to a press release announcing the bill. It also would require the companies to file an annual report disclosing third-party contracts involving data collection and give users the right to delete some or all of their collected data.
“For years, social media companies have told consumers that their products are free to the user. But that’s not true – you are paying with your data instead of your wallet,” Virginia Democratic Sen. Mark Warner said in the press release.
Facebook, one of the companies that would be impacted by the bill, already discloses a metric that gives some visibility into the value of their users’ data. Facebook shares Average Revenue Per User (ARPU) in its quarterly earnings reports, which it files with the Securities and Exchange Commission. In its latest report, Facebook said it generated an average of $6.42 in revenue per user.
The introduction of the DASHBOARD Act is the latest step from lawmakers from both sides of the aisle who have long-threatened regulatory action against the nation’s largest tech companies. The two senators who introduced the bill, Warner and Missouri Republican Josh Hawley, have both been outspoken advocates for tech regulation and already collaborated on Hawley’s “Do Not Track” bill that would let users opt out of some data collection. The new bill’s introduction comes as Big Tech is facing mounting scrutiny from top antitrust regulators at the Federal Trade Commission and Justice Department.
Both senators have introduced even more legislation aimed at holding Big Tech accountable for users’ data and for their content policies.
Hawley introduced a bill last week that would remove big tech’s immunity from liability for users’ content on their platforms under Section 230 of the Communications Decency Act of 1996. If passed, the bill could provide a steep hurdle for companies like Facebook, Twitter and Google’s YouTube, which rely on user content to fuel their platforms and growth. The bill grants the opportunity to earn immunity if the companies agree to submit to audits every two years to show their content-removal practices are “politically neutral.”
Warner has also introduced legislation to bring greater transparency to Big Tech’s practices. In April, he introduced a bill that would ban online platforms with more than 100 million monthly active users from using “dark patterns,” which are designed to persuade users into giving up more information than they likely understand. One example is a prompt to access phone or email contacts as a requirement to use the platform.
Oil traders are under-prepared for another flare-up in U.S.-Iran tensions, energy analysts have told CNBC, as President Donald Trump‘s administration prepares to impose “major ” new sanctions on the Islamic Republic.
Six oil tankers and a U.S. spy drone have been attacked since May either in, or near, the Strait of Hormuz — the world’s busiest transit lane for seaborne oil shipments that separates Iran from its neighboring Gulf states.
The prospect of another military conflict in the Middle East prompted international benchmark Brent crude to climb around 5% last week, while U.S. West Texas Intermediate (WTI) jumped more than 10% — its biggest gain since December 2016.
Nonetheless, David Hewitt, an oil and gas analyst at Macquarie, told CNBC’s “Street Signs Europe” on Monday that oil traders were still underestimating the impact of another flare-up between Washington and Tehran.
When asked whether there is an insufficient amount of geopolitical risk premium priced into energy markets at present, Hewitt replied: “The simple answer is yes — and absolutely yes.”
Iranian soldiers take part in the “National Persian Gulf day” in the Strait of Hormuz, on April 30, 2019.
ATTA KENARE | AFP | Getty Images
“If we go to more sanctions today… You would expect that they will react more. So, back to the geopolitical pricing in crude, you have got to think that there is a greater potential for something to happen at some point in the future be it this week or next, or as we go forward,” Hewitt said.
Brent crude was trading at $65.28 at around 8:30 a.m. ET on Monday, up around 0.1%, while U.S. WTI stood at $57.88, more than 0.7% higher.
Chances of US-Iran tensions escalating are ‘very, very high’
Trump reportedly approved military strikes against Iran late Thursday in retaliation for the downing of an unmanned American drone, before abruptly reversing his decision.
The U.S. president has since said in an interview with NBC News that he does not want war with Iran but, if it comes, there will be “obliteration like you’ve never seen before.”
Tensions between the U.S. and Iran have spiked since May last year when Trump withdrew from the 2015 nuclear deal and reinstated sweeping sanctions on the country.
“They will strike back one way or the other; I think chances of tensions becoming bigger is very, very high in the near future,” Fereidun Fesharaki, who was a former energy advisor to the government in Tehran in the 1970s, told CNBC’s “Squawk Box” on Monday.
Chances of a conflict are at least 50% right now, Fesharaki said. It may not be a “full war,” he pointed out, “but conflict which would disrupt (energy) supplies.”
If Trump had carried out those military strikes as planned, the geopolitical risk premium on oil prices would have been $5 to $10 a barrel, said Fesharaki. Now, the geopolitical risk premium “is only one or two bucks at the moment, it’s not really high enough,” he added.
Talk of a return to $100 oil is ‘greatly exaggerated’
Earlier this month, a top military aide to Iran’s supreme leader Ayatollah Ali Khamenei, Yahya Rahim Safavi, warned that “the first bullet fired in the Persian Gulf will push oil prices above $100.”
However, Stephen Brennock, an analyst at PVM Oil Associates, told CNBC via email on Monday that he was skeptical about the prospect of a dramatic surge in oil prices.
“Some have talked about the potential for a return to $100 oil in the event of another flare up of U.S.-Iran tensions but I suspect these are greatly exaggerated.”
“My gut tells me that neither side wants to be dragged into military conflict and thus the odds of a sustained disruption to supplies in the region are slim. Undoubtedly, tensions will continue to run high as Washington turns the sanctions screws on Iran but war (thankfully) currently seems like a distant reality,” Brennock said (parentheses in quote are his).
Kidfresh grew out of a desire to remove the junk from frozen foods.
3 min read
Matt Cohen thanks his French background for pursuing what others may have found to be a foolish business: frozen food for kids.
This was in 2007, about a decade before the recent surge in interest and sales in the category, when Cohen’s two children were young. Built off the success of a now-closed specialty kids’ food store Cohen co-founded in New York City — “like a mini Whole Foods focused on kids,” he said — Kidfresh launched into retailers in 2009, and now claims to be the top selling better-for-you frozen kids food brand (Conagra’s Kid Cuisine still outsells it, according to IRI data), with its products in more than 10,000 stores.
“Being French allowed me to sort of have a romantic view of frozen,” he said. “In France, you grow up on frozen, and you can have wonderful cooked dishes that are frozen. There’s even a specialty retailer that sells only frozen food in France called Picard’s. Frozen is great, it’s just a matter of, if you freeze junk, you get junk. But if you freeze a five-star meal you’ll get a five-star meal. Frozen is just a mechanism to extend shelf life without any additives and preservatives.”
What also makes Kidfresh stand out is the vegetables the brand hides in beloved and popular classic kid meals and snacks, such as its Wagon Wheels Mac ‘N Cheese with carrots, Super Duper Chicken Nuggets with cauliflower and onions and Mighty Meaty Chicken Meatballs with carrots, onions and celery (the brand’s top three sellers). It recently debuted mozzarella sticks, burritos and waffles.
Cohen also attributes the success of Kidfresh to its branding, which targets parents, unlike other brands, which uses bright colors and cartoon characters to win over kids.
Image Credit: Courtesy of Kidfresh
“In frozen, mom is the purchaser,” he said. “Mom has the problem. ‘I need to find a solution for my kids that will be healthy and convenient and that my kid will like.’ So we talked to the mom.”
Kidfresh products are all natural and made with some organic ingredients, but the company decided to go after customers in conventional stores, with prices that average around $3.99.
“We didn’t want to go into the premium natural and organic world and offer yet another premium offering,” he said. “We wanted the Walmart mom, the Target mom, the Kroger mom, the ShopRite mom, the HEB mom. That allowed us to really build scale, because you had this huge void in frozen.”
While that’s the core of the brand, Cohen said that he finds it challenging to not pursue opportunities in other areas of the grocery store, such as snacks, refrigerated lunches and beverages.
“It’s a matter of prioritizing our path forward and going step by step and making sure that we hit the mark one step at a time,” said Cohen, a former management consultant. “There’s so much junk out there in other categories, but I just want to make sure we own frozen.”
In the 1950s, the average age of a company on the S&P 500 index was 60. Today, that number is 20. This means that the most successful corporations are growing three times faster than they have in the past. To succeed at this rate of rapid change, employees and business leaders have had to adapt by adopting growth mindsets, learning new skills, and embracing flexibility. Where stability and long-term planning were once the mark of a sound strategy, adaptability is the new competitive advantage.
This need for adaptability is not new, though it doesn’t come easy to everyone. Over the past two decades, many large companies have failed to evolve and seen their business margins, market share, and profitability suffer — sometimes leading to devastating results.
So why are some companies able to evolve while others struggle? I argue that it comes down to who you hire. Fundamentally, leaders with a growth mindset believe intelligence and success can be learned, while those with a fixed mindset believe that these are static traits over which they have little control. In the context of a large company that is seeing increasingly volatile business results, leaders with a growth mindset are far more likely to adapt, push for change, and encourage others do the same — a skill that is needed to succeed in today’s workforce.
The good news is that your ability to adapt can be developed, and a unique pool of professionals may serve as exemplary guides to us all: successful early stage startup employees. In particular, I’ve defined a group I refer to as first hires, or people who joined a startup in its early stages, stayed with the company through a successful exit event — either an acquisition or an IPO — and meaningfully contributed to that success. Understanding the practices that have allowed first hires to succeed in the fast-paced environments that are inherent to most startups can give the rest of us insight into how to do the same in our own organizations.
Over the past year I have interviewed 25 of these first hires, researched over 50 venture capitalists, academics, entrepreneurs, corporate leaders, and early stage startup employees, and reflected on my own experience as one of the first employees and now Managing Director at General Assembly. Through this research, I have assembled a set of best practices we can learn from, along with suggestions on how to apply them within the context of your own role. While these practices are largely drawn from the experiences of startup employees, elements of them also apply directly to the skills needed to succeed in a much larger organization.
1) Pitch before you apply.
When a business’s environment changes — whether from entering a new market or competition — its structure must adapt to accommodate that change. This often means that new roles must be created to carry out new functions and initiatives. But these changes don’t happen in a vacuum. People drive them. Instead of fitting into a structure as it’s laid out, first hires often anticipate the need for new positions before an organization creates them.
Many of the first hires I researched got their jobs by pitching their bosses a role that didn’t yet exist— at least not in the traditional sense. Chris Fralic, Former VP of Business Development at Half.com, got his start at the company by writing a pitch deck about himself and presenting it to the founder. Tristan Walker, the first business development employee at Foursquare took a similar approach to secure his role, and later went on to be a VP. And perhaps most famously, Ryan Graves, first employee at Uber, pitched his job to the CEO via Twitter.
But this approach is not restricted to securing a first job. First hires routinely morph their roles as the business changes. Jon Ying, one of the first employees at Dropbbox, went through no fewer than eight variations of his role — from Community Manager to Creative Director to “Head of Black Ops” — as he responded to the organization’s fast-changing needs and took on more varied responsibilities. “I was given a lot of implicit trust to act in a way that benefited the company,” Ying told me. “Of course, before I did anything huge I’d always sanity check with colleagues or leadership.”
How can you apply this practice?
Write a pitch deck for yourself. More than a simple résumé, a pitch deck positions you in a particular way, and forces you to ask important questions of your career: What is your ideal role? What problem can you help an organization solve? What is the best way to represent what you’ve accomplished already? Once you’ve identified your strengths, you’ll get a greater sense of what you can offer. The next time you see an opportunity for a role that requires these skills — whether it exists within your organization or not — you may be more likely to go for it.
2) Maintain an external perspective.
In the early days of any new business, nothing is certain. The business model may bust, the customers may not come, the market may be a mirage. Competitive forces can make or break you. To be successful, your employees must retain an external perspective and constantly consider the risks, dangers, and surprises that might throw you off course.
Some of this paranoia exists as a result of what some employees call the “kill zone” surrounding startup companies, particularly in the technology space. You only have to look up the history of products like Picasa, Meerkat, and (some would say) Snapchat to see how big players can squash encroachers.
But when you’re aware of the environment around you, you’re better prepared to foresee and respond to competition. Steve Ballmer, one of Microsoft’s first hires, is famous for this. In Great by Choice, management guru Jim Collins recounts Ballmer rattling off an endless array of catastrophes that might occur at Microsoft as the company prepared for its IPO and had to disclose potential risks to investors. Finally, after pausing to digest all the possible carnage, Collins remembers one of the underwriters saying to Ballmer, “I’d hate to hear you on a bad day.” Following that initial public offering, Microsoft became one of the most successful companies in history, unseating major competitors like IBM in the personal computer revolution, and continuing to adapt into the cloud computing era of today. Their ability to predict and respond to competition no doubt played a key role.
How can you apply this practice?
Set up Google Alerts for your top five competitors. This may seem simple, but how you use the information you learn is the real practice. Maybe it will inspire new ideas, present cautionary tales, or better position you to answer questions about your competitors during meetings.
3) Don’t forget about the mission.
When a startup begins to grow in size, its employees can lose sight of the mission and purpose upon which it was founded. The routine of weekly meetings, quarterly updates, and annual reports take charge. But many first hires still remember the days spent debating the business model, introducing it time and again to new partners and hires, and sometimes even defending its reason for existing in the first place.
This context often pushes first hires to be gritty and creative. It keeps them grounded by providing them with a robust understanding of the company roadmap and infrastructure. As a result, they are able to more easily understand the purpose behind a change, adapt to it, take advantage of it, and find opportunities in unexpected places.
This habit of maintaining a sense of purpose is the most personal to me. Last year, General Assembly was acquired by the Adecco Group — a company with 30,000 employees, complex operations in 60 countries, and scrutiny from public markets. In the months after the acquisition, I expected myself to become more complacent. We had made it. The stability that comes with size could now be ours. And yet, I feel more driven than ever. Years of new ideas and business models that were never possible before suddenly seem in reach. As my role, rhythm, and ways of working change, I find myself comfortably able to adapt — an ability that took eight years of practice to master. As General Assembly morphed from startup to a large business, our company mission has served as my primary motivation. With our new owners, the opportunity to achieve that mission has grown.
All this to say, employees who are able to keep sight of your company’s mission can more easily recognize and take advantage of the opportunities change presents.
How can you apply this practice?
You probably have a corporate “mission statement” somewhere in your annual report. Revisiting this regularly could help, but a better approach is to get your hands on presentations, recordings, and writings from your company’s founding team. Take time to digest these. Then, distill your own one-line mission statement for your company. Place this somewhere you’ll see it often, and reflect on it before making any significant decisions.
4) Keep customers top of mind.
Businesses that keep their customers at the center of their strategic planning and execution will always be more resilient in the face of change. Even as their business grows, they will be able to spot issues and trends on the consumer end more accurately and respond to them earlier. But in many sectors, this remains a challenge. The average employee rarely interacts with customers — instead they see presentations, focus group reports, and aggregated opinions from those on the front lines.
The majority of first hires I spoke with remember their first customers. Many interacted with them on a personal level and learned their motivations behind buying the company’s products. These memories and insights enable them to bring the voice of the customer into key business decisions surrounding new products, features, promotional activity, and more. Organizations that prioritize client-customer relationships on a personal level — no matter what their size — may see the same benefits.
How can you apply this practice?
Find a way to get access to two customers — a happy one and an angry one. This could mean joining a sales meeting, listening in on a customer service call, or attending an annual business review. Hearing the pros and cons of your product directly from a customer will deepen your understanding of your business more than most research can.
5) Be a pilot, not a passenger.
The flatter structure and smaller team size often seen in startups allows employees to give more attention to each of their projects. If someone succeeds, they are visible. But the same is true if they fail. More acutely, the smaller the company the more responsibility is invested in each employee, and therefore a greater sense of ownership is bestowed upon them.
As most companies grow, however, roles and responsibilities become more specific. Projects that were once a company-wide effort break out into tech teams, sales teams, marketing teams, and more, until a person’s entire job may be as specific as testing email subject lines to market certain products. For some, this rapid growth may lead to a demotion and less responsibility. But for others, particularly those who take ownership over more challenging projects, it is an opportunity.
The most successful early stage employees I spoke with exhibit an intense sense of ownership over their responsibilities, and often beyond them as well. Take the case of Nikhil Khosla, who joined General Assembly as Product Manager on our fledgling new “Standards” team. The mission of this team was bold: create a set of industry-approved standards to define technology skills for the future. The resources were limited. The playbook was non-existent. Khosla had to be resourceful and inventive to succeed. He had to take on multiple roles and cross-collaborate with technology, marketing, and sales to envision and launch this new product. On a given day, Khosla could be found writing a technical roadmap, pitching with the sales team, or doing customer service calls. “Frankly, at a startup, there’s no one else to blame,” Khosla told me. “So you take ownership, especially when there’s only one or two people working on a product”.
Khosla’s experience shows how larger companies value this sense of ownership and initiative to learn. After a few years helping to build and launch General Assembly’s Standards product, Ralph Lauren recruited him as one of their youngest VPs. He is now responsible for the company’s outerwear line of business.
How can you apply this practice?
Play CEO for a day. Force yourself to consider each meeting, project, and email you interact with from your CEO’s perspective. How would he or she respond or react in the same situation? With this perspective, what might you change about your own response or reaction? CEOs often have to balance conflicting needs and roles to make a decision. This mental exercise will help you step into those shoes and provide you with a more holistic view of your work and the company, thereby increasing your sense of ownership. (If you are the CEO, try wearing a first hires’s hat for a day.)
After almost ten years spent helping some of the world’s largest and fastest growing companies build their teams’ skills for the future, I’m increasingly convinced that there are bright careers ahead for employees, managers, and leaders who think and act like first hires. Both large and small companies will invest in team members who are ready to adapt, and I believe that studying first hiresillustrates a roadmap to mastering that skill.
Surveys from the 1970s show that married women in more than 80% of affluent households had nominal or no involvement in investment decisions. Fast forward to 2017, and more than 80% of married affluent women make financial decisions jointly with their spouses. Of those with just one person making financial decisions, it’s now split almost evenly: 7.9% of these households have the man in charge of the money and 8.3% have the woman in charge. These facts must be heard by marketers to the affluent. Buying decisions once thought of as gender specific no longer are. The interest in one thing or another may be held only or principally by either the husband or the wife, but the decision releasing the money for the purchase won’t be in 80% of the households.
Another big change: Beginning in 2005, single women became the second-largest group of home buyers, right behind married couples. And single women buy nearly twice as many homes as single men. Yet when have you seen any real estate advertising specifically aimed at single women? Comparable examples can be found in numerous other product and service categories, where marketers are ignoring opportunities in current reality.
Some single women are single for the traditional reason— not yet (or ever) finding the right man. But there’s a growing population of what demographic analysts call the “willfully unmarried,” who consciously and deliberately choose to stay single. Among the willfully unmarried women are two groups of special interest to us: the particularly affluent single women and the affluent boomer single women. In these two groups, and particularly in a group composed of overlap from the two, we find untold spending power, controlled by women who are buying their own homes, doing their own investing, planning and funding their own retirements, planning their own vacations, and so on—for life. These women are permanent heads of households, and can and should be marketed to as such, yet hardly anybody is. In fact, my files are lacking any good examples of advertising or marketing specific to this to show you!
Late-in-Life Divorce as a Spending Event
Among U.S. adults aged 50 and older, the divorce rate has doubled since the 1990s. The majority of the divorces that occur after 20 to 25 years of marriage are instigated by the wives. Far from grieving quietly, many of these women quickly re-enter the dating and next-husband-hunting game, find it highly competitive, populated by an insufficient quantity of men, and full of older men seeking younger women. Consequently, a number of self-improvement investments occur within six to 12 months of divorce: cosmetic surgery, cosmetic dentistry, weight loss products, new and younger-looking wardrobe, new and younger-looking car. In short, affluent women age 45 through 60, divorcing after long marriages, tend to go on personal spending binges and be exceptionally susceptible to certain kinds of product and service offers about four to six months post-divorce.
Cosmetic surgery was once almost exclusively for affluent women, or actresses and models. And it wasn’t openly discussed. Today, its popularity spans age ranges from shockingly young to surprisingly old, from mass-affluent to ultra-affluent. And not only is it openly discussed, but it’s discussed in ways that might make many people blush. For example, according to a study published in the Aesthetic Surgery Journal, 81% of breast surgery patients and 68% of other body surgery patients reported improvements in sexual satisfaction. More than 50% of these patients said they were able to achieve orgasm more easily following their surgery. And 56% also noted increases in their partners’ sexual interest and satisfaction following the surgery.
What’s most important about all this, from a marketing standpoint, is the willingness of women to confront every imaginable health, beauty, aging, and lifestyle issue head-on, and the willingness of affluent women to spend almost without limitation on themselves, their physical and emotional well-being.
It Isn’t Simple
As an example of the complexity required for success in marketing to affluent women, consider the financial services field.
In their book Marketing to the Mindset of Boomers and Their Elders, Carol Morgan and Doran Levy accuse financial services and investment firms of “conjuring up differences where none exist” in advertising, marketing, and selling to affluent women (investable assets, $500,000+) and mass-affluent women (investable assets, $100,000+) making their own investment decisions. Assumptions are made by many investment marketers that “women feel differently and learn differently about investing” so there’s a need to “speak to women in terms relevant to their lives and in language that’s appealing to them.”
But the popular financial writer Jane Bryant Quinn expressed her distaste for financial advertising treating women as “a breed apart.” Quinn describes this advertising as “condescending.” “Who,” she asks, “besides women are told they need help because they are emotionally impaired?” Quinn cites market research studies confirming that there’s no difference in investment patterns by gender.
So who’s right? I would suggest they’re both right and wrong.
First of all, lumping the mass-affluent and affluent women together is a serious mistake. Women with $500,000 and up to invest have, for the most part, been more involved with their wealth for a longer period of time. They also have access to a different level of financial advisor and choices of investment-related services. They’re less likely to be paying attention to Suze Orman and Money magazine and more likely to be reading The Wall Street Journal, Forbes, and Worth than their mass-affluent counterparts.
But Quinn is off-base in denying that gender differences affect perception of and responsiveness to advertising and overt marketing. Georgette Geller-Petro, an executive with the financial services giant AXA Financial®, states, “Through feedback from our advisors who work with women, we’ve found that women’s financial goals, as well as how they articulate them, are different than those of men.”
So gender difference matters, though Quinn is right when she recoils at ad approaches that feel “condescending.” Women, especially career women, are hypersensitive to being talked down to, to not being given credit for their intelligence, knowledge, and experience. There’s a profound difference in the way women respond to language.
Daniel Ek, chief executive officer and co-founder of Spotify AB.
Akio Kon | Bloomberg | Getty Images
Here are the biggest calls on Wall Street on Monday
Evercore ISI downgraded Spotify to ‘underperform’ from ‘in line’
Evercore said it is concerned about whether Spotify can generate a gross profit that investors demand.
“While our view is that SPOT user and revenue estimates are achievable, we believe the stock’s recent rally reflects an overly optimistic view as to the trajectory of gross margin and potential label negotiation outcomes. We simply do not see a path by which SPOT can generate the level of gross profit demanded by Street estimates over the medium-term. “
Jefferies upgraded Deere to ‘buy’ from ‘hold’
Jefferies said it thinks agricultural fundamentals are finally “turning.”
“We upgrade the shares of DE to Buy following 5 years of depressed Large ag fundamentals. A tightened global crop supply demand balance and positive momentum in farmer net income support double-digit large equipment growth through 2020. We correspondingly raise our revenue (and margin) forecasts and Price Target to $190, an 11.0x multiple on 2020 EBITDA. Our $12.00 earnings outlook is ahead of Consensus of $11.65, with some additional upside bias in our view. “
UBS upgraded Hostess Brands to ‘buy’ from ‘neutral’
UBS said it thinks the stock has 25% upside.
“Hostess offers a favorable event path and we identify three catalysts for why we think TWNK shares should outperform and have ~25% stock upside. First, Hostess sales trends are accelerating (per Nielsen data) as it launches new breakfast product lines & regains shelf space at its largest customer (WMT is 21% of mix). Second, the recent acquisition of a Chicago Bakery facility, which had been poorly operated under prior ownership, brings Hostess new production capability in breakfast categories and a $40m EBITDA contribution bridge over 2 years (to +$25m in FY20 from -$15m in FY18). Third, TWNK is on pace to generate $350 -400m in FCF over three years—we estimate this could reduce debt leverage to ~2.5x and transfer $2/share in enterprise value to equity holders. “
Cowen upgraded United Technologies to ‘outperform’ from ‘market perform’
Cowen said it is bullish on the company’s merger with Raytheon.
“We like UTX for extended Aerospace cash ramp and the proposed RTN merger. Its 5%+ selloff vs. S&P since deal announcement offers a win-win for attractive standalone valuation or merger benefits. We’re hiking our rating to Outperform for a PT of $150. “
Stephens named Electronic Arts as a ‘best idea’
Stephens said it likes the game maker’s upcoming slate of releases.
“In the console space we continue to be buyers of both Take-Two and EA but we are flipping our best idea to EA as we see more near-term catalysts for them. With Apex Legends Season 2 beginning on July 2nd, the data shows that Fortnite’s popularity has hit a lull and Season 2 is launching at the right time to capture momentum. We’re not predicting that Apex is going to eclipse Fortnite again as it did in February, but we have confidence that the updates Respawn is making for Season 2 will bring back a good chunk of the player base. We see a bull case scenario where Season 2 could generate $150 mil in revenue, likely leading to upside to EA’s FY guidance. “
Wedbush upgraded Dunkin’ Brands to ‘outperform’ from ‘neutral’
Wedbush said it thinks the company’s same-store sales growth is “underappreciated.”
“We believe Dunkin‘ U.S. is currently undergoing an inflection in SSS growth that is underappreciated by the Street. Importantly, in our view, the probability of a sustained inflection beyond the near-term is now high enough to warrant a more positive stance. Therefore, we upgrade shares of DNKN to OUTPERFORM from NEUTRAL. “
MoffettNathanson lowered its price target on Alphabet to $1,250 from $1,290
Moffett said it is concerned about Alphabet’s revenue growth trends.
“After analyzing Google‘s Economic Impact reports, we are seeing a concerning trend emerge. It appears that U.S. Search revenue growth has been steadily eroding over the past several years. Yet, this has been masked in overall results as other Google businesses, such as YouTube, Cloud or Hardware, seem to have accelerated to make up for weakness in core Search. “
Stephens downgraded International Paper to ‘equal-weight’ from ‘overweight’
Stephens downgraded the stock and said containerboard pricing was too “unpredictable.”
“We are reducing our rating on International Paper shares to Equal- Weight from Overweight to reflect the damage being done to investor confidence by the increasing unpredictability of containerboard pricing pronouncements, as well as continued new capacity announcements that promise to keep the need for economic downtime high. “
Loop Capital upgraded Tempur Sealy to ‘hold’ from ‘sell’
Loop said it is more positive following the company’s agreement to re-enter Mattress Firm.
“We are raising our rating from Sell to Hold and increasing our price target from $50 to $70 on TPX following its announcement that it will reenter Mattress Firm and will also become the primary supplier for Big Lots (BIG:$29.98-Hold). Though there has been much discussion about TPX renegotiating with Mattress Firm, the Big Lots agreement was more of a surprise as that category has grown strongly at BIG with another vendor over the past several years. At the same time, we believe there is an increased probability of potential further tariffs that could slow the tide of lower-priced imported mattresses that are growing rapidly through emergent sales channels. “
Morgan Stanley downgraded Occidental Petroleum to ‘equal-weight’ from ‘overweight’
Morgan Stanley said there is “outsized risk” to the stock if oil prices move lower.
“We expect OXY to recover some if its -18% underperformance since the company’s interest in APC was first highlighted in media reports on April 12; however, deal execution remains key for the stock to re-rate meaningfully higher. As we’ve noted in prior reports, the planned acquisition looks free cash flow accretive to OXY, but it also pushes leverage to among the highest in our coverage. As a result, we see a wide range of outcomes for the stock, with outsized risk if oil prices move lower. We estimate each $5 decline in oil prices would increase leverage by ~0.5x+ while also reducing dividend coverage — a potentially challenging situation for OXY to navigate. “
Making mistakes is part of establishing a better business venture.
2 min read
Opinions expressed by Entrepreneur contributors are their own.
In this video, Entrepreneur Network partner Business Rockstars speaks with Shaka Senghorn, the Executive Director of the Anti-Recidivism Coalition. Senghorn’s team concentrates on helping people who have served time in jail re-enter the workforce.
Senghorn believes that if you treat people with respect, they can easily maintain their freedom. The members of the Coalition, who are currently or were formerly incarcerated, are now able to give back to society as regular employees, life coaches and mentors.
Racial barriers and gender barriers do not stand in the way of the organization’s work. The diverse workforce also leads to a freer transfer of ideas and more collaboration, which Senghorn believes if the larger population could replicate, society would be a better place.
Senghorn’s advice for budding entrepreneurs is to embrace failure. Continue to learn from the mistakes you make and study those great leaders who encountered failures repeatedly along their journeys to acheievement. Your best path to progress is dependent on your ability to recover from failures, while the worst is to give up completely.
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One Wall Street brokerage told clients on Monday that the globe is “one step away” from recession as the world’s two largest economies head to the G-20 summit meeting in Japan this week to try to hash out key issues and end a monthslong trade war.
While escalation isn’t what UBS expects, a failed meeting between President Donald Trump and China’s Xi Jinping that results in a new wave of tariffs would mean “major” changes to global GDP and market forecasts, global head of economic research Arend Kapteyn wrote in a note.
If the trade war escalates, “we estimate global growth would be 75bp lower over the subsequent six quarters and that the contours would resemble a mild ‘global recession’ —similar in magnitude to the Eurozone crisis, the oil collapse in the mid-1980s and the ‘Tequila’ crisis of the 1990s,” he wrote.
The impact of a scuttled trade deal at the U.S.-China meeting in Osaka and agitated relations wouldn’t be felt immediately, however, but grow in severity over several quarters as higher prices stifle demand and growth, the UBS researcher wrote. In the United States, the cumulative reduction in GDP would be about 1% over six quarters, 1.2% in China and 0.74% in Europe, Kapteyn wrote.
U.S. and Chinese negotiators are expected to begin discussions in Osaka this week before Trump and Xi meet, hoping to quell inflamed relations between Washington and Beijing, which have crumbled since late April. In a surprise move, Trump tweeted on May 5 that tariffs on $200 billion worth of Chinese goods would increase to 25% and that another 25% tariff would “shortly” be imposed on an additional $325 billion of imported goods from China.
Traders blamed the worsened trade outlook for an equity pullback in May, with the S&P 500 down 6.5% last month.
But further aggravation of the trade conflict could push global equities down 20%, the economist wrote, with the prior U.S. outperformance relative to Europe eroding and emerging markets taking a heavy hit.
“In global sectors, Materials stands out as most vulnerable, but some defensive and crowded segments are also at risk amidst weaker growth,” Kapteyn added. “For a bottom up perspective, we lean on our prior work to highlight trade and crowded growth exposed stocks.”
Source: U.N. Comtrade database, U.S. Department of Commerce, Federal Reserve Bank of St. Louis
The economist added that all major central banks would be forced to ease monetary policy, he added, with the U.S. Federal Reserve compelled to cut interest rates by 100 basis points on top of an expected 50-basis-point cut in July. Such a push pressure the yield on the benchmark 10-year Treasury note below its record low of 1.3%, the UBS economist predicted.
In China, the government would add another 150 basis points of total social financing (TSF) growth, with GDP falling under 6%. China’s total social financing is a catchall term for lending by banks and other institutions.
“Once policy makers have delivered the limited stimulus, investors will likely worry about them running out of options,” the UBS team wrote. “In the trade escalation case, we expect US 10y yields to fall through all-time lows.”
Dunkin’ Brands — An analyst at Wedbush upgraded Dunkin’ Brands to “outperform” from “neutral,” and raised his price target on the stock to $92 per share from $76 a share. The analyst said Dunkin’s same-store sales are at an inflection point “that is underappreciated by the Street.” Dunkin’ shares rose 1.3% to $80.55 per share.
Hostess Brands — Hostess Brands was upgraded to “buy” from “neutral” by an analyst at UBS. The analyst cited accelerating sales, the acquisition of a Chicago Bakery facility and strong free cash flow growth for the upgrade. Hostess shares climbed 1.4% in the premarket.
Deere — Jefferies upgraded the tractor maker to “buy” from “hold,” noting that a “tightened global crop supply demand balance and positive momentum in farmer net income support double-digit large equipment growth through 2020.” Deere shares rose 1.4%.
Spotify Technology — The music streaming service’s stock slid 3.6% after Evercore ISI downgraded it to “underperform” from “in line.” The firm also cut Spotify’s price target to $110 per share from $125 a share. “We simply do not see a path by which SPOT can generate the level of gross profit demanded by Street estimates over the medium-term,” Evercore ISI said.
International Paper — International Paper shares fell 1.2% after being downgraded by an analyst at Stephens to “equal weight” from “overweight.” The analyst said the downgrade reflects uncertainty around “containerboard pricing pronouncements.”
Alphabet — An analyst at MoffettNathanson trimmed his price target on the tech giant’s stock to $1,250 per share from $1,290 a share, citing a “growing lack of conviction that Google can maintain their historic 20%+ revenue growth.” Alphabet shares slipped 0.1% to around $1,123 per share before the bell.
United Technologies — United Technologies was upgraded to “outperform” from “market perform” by an analyst at Cowen. The analyst noted United’s proposed merger with Raytheon favors the Dow member, adding its decline since the deal’s announcement “offers a win-win for attractive standalone valuation or merger benefits.” United Technologies shares climbed 1.1%.
Electronic Arts — Stephens named the video game maker its “best idea in the space” ahead of the Apex Legends Season 2 release on July 2. The research firm said Fortnite’s popularity has “hit a lull,” giving EA an opportunity to “capture momentum” with its Season 2 release.
There are three common stories that employees tell themselves when they don’t get enough feedback from their managers: 1.) “As long as I’m not creating trouble for my manager, I’m doing fine.” If the bar for satisfactory performance is “not a problem employee”, then your bar is way too low. 2.) “My manager doesn’t think I can take feedback well.” If you don’t have compelling evidence to support the belief that your employee won’t receive feedback well, then you need to, as Nike suggests, “Just do it”. 3.) “My manager doesn’t think I can change.” It’s important to adopt a growth mindset, for your employee and for yourself. By giving more helpful feedback, you’ll be providing your employees with the data they need to do more of what’s working, less of what isn’t, and with fewer opportunities to make up their own stories.
Feedback is a daily staple of my work as an executive coach. I am often giving direct feedback to the leaders I work with, sharing 360-degree feedback from the leader’s colleagues, and then helping them process and reflect on the feedback they receive.
One piece of feedback that the executives I coach receive over and over again from their direct reports is: “She doesn’t give enough helpful feedback.”
When I ask these direct reports about the impact this has on them, I find that, in the absence of understanding why they’re getting so little feedback, they often make up their own explanations.
Here are three of the most common stories that employees tell themselves about what their manager is thinking when they don’t get enough helpful feedback, why these stories are a problem for them (and for you), and what you can do as a manager to rewrite these stories:
Story 1: “As long as I’m not creating trouble for my manager, I’m doing fine.”
Why this is a problem: While some people are perfectly satisfied just staying out of trouble, most professionals would rather know what impact they’re having — both the good and the not-so-good. If the bar for satisfactory performance is “not a problem employee,” then your bar is way too low. And, as a result, you will likely get more of what you focus on, which means a whole bunch of “non-troublemakers” as opposed to high-performing, committed, and engaged professionals.
Furthermore, communicating this mindset (overtly or covertly) is likely to keep an employee from bringing important issues to your attention for fear that they might “create trouble” — and then lose out on the only input they’re getting from you.
What to do instead: “Not creating trouble” should become your minimum expectation, not the highest goal you set for your people. And after you change your expectation, change your mindset and your language. Let your employees know specifically what you appreciate and value when they meet or exceed expectations, and also share your perspective on what they could do differently when they fall short. Also let them know what constitutes unacceptable “trouble” (like making inappropriate remarks, repeatedly showing up late, poor follow-through on tasks) vs. acceptable “trouble” (such as difficulty obtaining a resource, not knowing how to do something, or needing a personal accommodation).
Story 2: “My manager doesn’t think I can take feedback well.”
If you’re not giving feedback because you actually fear that it won’t be well-received, then you’re falling short on three counts: first, you’re not helping your direct report to have more impact (which also means, by extension, that you’re not supporting her to better help the team, the clients, and the organization). Second, you’re not modeling accountable behavior if you skip giving feedback because you fear how it will land. And third, you may be contributing to a lack of psychological safety by failing to create the opportunity for your direct report to experience support rather than retribution.
What to do instead: Separate out the story from the facts of how your direct report receives feedback. If you aren’t giving regular feedback because you assume or fear that your colleague won’t receive it well, ask yourself, “What concrete, observable evidence am I basing that assumption on?” If the list includes behaviors like, “He walks out of meetings abruptly when he hears something he doesn’t agree with,” or “She often asks, ‘Am I going to get fired for this?’ when I bring a client concern to her attention,” then you may be justified in your concerns. In my article,“When Your Employee Doesn’t Take Feedback,” I suggest that managers start giving feedback on how the employee receives feedback (or in this case, how you think he or she is likely to receive feedback based on similar situations).
And if it turns out that you don’t have compelling evidence to support your belief that he or she won’t receive it well, then you need to, as Nike suggests, “Just do it.” Give your employees the feedback they crave.
Story 3: “My manager doesn’t think I can change.”
Why this is a problem: If you actually believe that your employee cannot change, you will not offer him the resources or opportunities to do so. This will set you up to be right, but at the expense of your employee’s current success, and future career trajectory. As Chris Miller, a program director at UNC Executive Development, writes in his white paper, “Expectations Create Outcomes: Growth Mindsets in Organizations”: “managers with fixed mindsets often fail to recognize positive changes in employee performance. They are also less likely to coach employees about how to improve performance or to offer constructive feedback…This leads to a loss of talent in organizations.”
What do to instead: Adopt a growth mindset, for your employee and for yourself. As Miller writes, “Employees with growth mindsets welcome challenges, work harder and more effectively, and persevere in the face of struggle, which makes them more successful learners and better contributors to their organizations than employees with fixed mindsets (Briceno, 2015).” If you hold a growth mindset for your employee, you will give more feedback because you believe she will welcome — and rise to — the challenge. And if you hold a growth mindset for yourself, you’ll be more comfortable giving feedback because you trust that you will welcome the challenge.