“Due to the actions of a few, the good intent quickly turned into a mess” — Candy company PEZ, which was forced to cancel its annual Easter egg hunt after parents (yes, parents) disobeyed the rules and began shoving each other. We hope you managed to keep your holiday weekend a little more civil.
MARKET SNAPSHOT
Big Picture
- In a shortened week of trading with markets closed early for Good Friday, U.S. stocks faltered, finishing mixed on Thursday to end their five-week winning streak
Alternatives to Watch
- Oil recovered on Thursday but posted a loss for the week, under heavy pressure due to a strengthening dollar, high crude stockpiles and weakening equities
Market Movers
- Staples and Office Depot, which are currently fighting the government to let their office supplies mega-merger go through, were boosted heavily (7% and 9%, respectively) after a judge accused the Federal Trade Commission of asking a witness to give false testimony
- Pandora and TiVo skyrocketed 11% and 23%, respectively, after separate merger rumors: TiVo is in advanced talks to be acquired by Rovi, while Pandora’s still searching around for buyers
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U.S. MACRO
GDP Ain’t Half Bad, And You Can Thank Yourself
Good news to start your week: U.S. fourth quarter GDP increased at a 1.4% annual rate, a nice upward revision from the previously reported 1% rate. This puts GDP growth at 2.4% for all of 2015. Not half bad. Who’s to thank for the better than expected results? You and us: consumer spending jumped 2.4%—which is a big deal, considering it accounts for more than two-thirds of U.S. economic activity. But why the spending spree? Steady wage increases, low gas prices and rising house prices—it’s as simple as that. This news puts fears of a recession to bed, but has got Janet Yellen and the Fed all jittery in anticipation of an interest rate hike (or two) later this year.
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CORPORATE PRIMER
Microsoft Gives ‘er Another Go
Take two: with help from numerous private equity firms, Microsoft is launching another effort to help finance an acquisition of faltering internet giant Yahoo. The price tag? A nice even $10 billion. And what do we mean by “another bid”? Glad you asked: once upon a time (meaning 2008), Microsoft tried and failed to buy out Yahoo. Props to Microsoft for getting back on the horse. Unfortunately, this horse is getting a lot of attention: big shots like Comcast, Disney, AT&T and hedge fund Starboard Value are looking to get in on the action—and Starboard’s approach is a little less board of director friendly, since it’s aggressively pushing to get the entire Yahoo board replaced—including embattled CEO Marissa Mayer.
For Sale: Playboy
In what might be the most fun project of the summer, investment bank Moelis & Company has the pleasure of handling the sale of Playboy, an entity and brand that’s worth up to $500 million. In honor of that valuation, here’s three fun facts:
- In addition to the legendary mag, the even more legendary Playboy mansion is up for sale for $200 million, with your very own Hugh Hefner as a live-in tenant.
- You likely already knew this, but we’ll to say it again since it bears repeating: the company now no longer publishes nude photography.
- But seriously, despite all the big changes, Playboy still faces a declining readership: its subscriber base has whittled from 5.6 million in 1975 to 800,000 today.
Apple Joins Showbiz
Apple announced that it will be working with musician will.i.am to create an original TV series…about apps. Uh, what? Are we ready for this? Don’t worry, it’s actually just a thinly-veiled marketing strategy, not quite a full venture into the realm of original TV production. Netflix can breathe a sigh of relief for now, but the move leaves us wondering: what is Apple up to? Perhaps CEO Tim Cook was right—the future of TV is apps.
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OTHER STORIES
- “Batman v Superman” takes huge $170 million at the box office
- Netflix throttles video on AT&T and Verizon to keep users under data caps
- PayPal shares slide amidst rumors of browser-based Apple Pay checkout
- McDonald’s trademarks a new slogan
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ECONOMIC CALENDAR
- Monday: Personal Income and Outlays; Pending Home Sales
- Tuesday: Dave & Buster’s Earnings; S&P Case-Schiller Home Price Index; Consumer Confidence
- Wednesday: Micron, Lululemon, Carnival Corp Earnings; ADP Private Employment Report
- Thursday: Weekly Jobless Claims
- Friday: BlackBerry Earnings; March Unemployment Report; ISM Manufacturing Index; Consumer Sentiment; Consumer Spending; Motor Vehicle Sales
SO MUCH EASTER CANDY
When you think “candy sales,” which holiday comes to mind first? Is it Halloween? Perhaps Valentine’s Day? Try Easter. Yes, the rabbit-infused holiday is actually the top dog when it comes to candy sales. Here are the chocolatey details:
- In the week leading into Easter last year, Americans bought $823 million of candy, narrowly beating out Halloween for most lucrative for candy retailers. Some perspective: that’s 146 million pounds, or half a pound for each American citizen.
- Of course, Americans don’t need a holiday excuse to munch on some sugary sweets: a typical week still sees around $300 million of candy sold. But that doesn’t stop 17% of candy sold each year from receiving some form of “seasonal” branding.
- But before you go thinking Easter candy is on the road to world domination, a note of caution: annual sales growth for Easter candy has actually slowed to 1.3% over the last four years. On the other hand, Halloween candy sales have grown at a more appetizing 13.6% pace.
INTERVIEW QUESTION OF THE DAY
What is the largest number that can be obtained as the product of positive integers that add up to 100? (Answer)
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STARTUP OF THE DAY
“Stuff by air. Anytime. Anywhere.” Sound familiar? It’s the slogan of Flirtey, an Australian startup attempting to revolutionize the drone delivery industry. Earlier this month, Flirtey completed what is thought to be the first legal U.S. drone delivery with a package that contained first-aid material in Reno, Nevada. We can think of an Amazonian-esque company whose interest is likely piqued.
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FOOD FOR THOUGHT
Working at Goldman? It might be worry time: the firm just announced to the New York Labor Department that it is predicting an increase from 43 to 109 job cuts this year.