Finimize - 🚗 Toyota's breaking down

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Today's big stories

Johnson & Johnson is buying heart device maker Abiomed in its biggest deal in almost six years
Here’s where Blackstone sees three big risks for the global economy, and the biggest opportunities – Read Now
Toyota reported disappointing quarterly results, and even the falling yen couldn't help

Finger On The Pulse

What’s Going On Here?

Healthcare giant Johnson & Johnson (J&J) announced on Tuesday that it’s buying heart device maker Abiomed.

What Does This Mean?

J&J announced plans to spin off its consumer goods division at the end of last year, going all-in on its other business areas instead. And now that it’s buying Abiomed in a deal worth around $17 billion, it seems to be putting its money where its mouth is. This deal – set to be J&J’s biggest in nearly six years – will cost a pretty penny: the healthcare titan’s shelling out 51% more than Abiomed’s shares were worth before the deal was announced. For J&J, it seems to be a case of “you get what you pay for”: this deal will let it get its mitts on Abiomed’s renowned Impella heart pumps for patients with severe heart disease, famed for being the smallest in the world, and inject its medical device segment with the tidy $1 billion a year that Abiomed currently brings in.

Why Should I Care?

For markets: Heart’s in the right place.
2022’s been a slow year for mergers and acquisitions, but this bumper deal bucks the trend. After all, J&J’s flush with cash from vaccine sales right now, so it can afford to snap up firms while valuations are low. And this isn’t just a smart short-term grab: heart disease is already one of the world’s leading causes of death, and with a growing population, demand for Abiomed’s devices is only likely to increase.

The bigger picture: Viva diversification.
J&J’s scouting out new opportunities as Covid slips away, and there are signs competitors are following suit. Rival medical goliath Pfizer reported impressive results on Tuesday, but with vaccine demand slowing outside the US, it’s certainly not putting all its eggs in one basket: it just announced plans to launch 19 new products over the next 18 months.

You might also like: The big opportunities behind big pharmaceutical companies.

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Analyst Take

Here’s Where Blackstone Sees Opportunities Now

By Russell Burns, Analyst

Blackstone’s latest overview of the global economy doesn’t make for cheerful reading.

Quite the opposite: the way the investment house sees things, there are three massive threats facing the world’s economies.

But Blackstone still believes there are opportunities to be found – and I won’t make you work to find out where they are.

So that’s today’s Insight: where Blackstone sees risks for the economy, and where you can find the best opportunities hiding.

Read or listen to the Insight here

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Fall Time

What’s Going On Here?

Toyota reported disappointing quarterly results on Tuesday, putting an end to the world’s biggest carmaker’s rousing pandemic performance.

What Does This Mean?

Toyota handled supply chain hiccups better than most carmakers during the pandemic, and even managed to pull record profit out of the last bumpy financial year. But it looks like chips are its Achilles heel now: chipmakers have prioritized supplying chips for electronics companies, with Toyota’s less-profitable auto chips falling by the wayside. And while the weaker yen gave the Japanese carmaker a leg up when it converted its international profit back into its home currency, exorbitant material costs more than wiped out that benefit.

So at the end of the day (well, the last quarter), Toyota’s operating profit dropped a much worse-than-expected 25% from the same time last year, marking its fourth-straight fall. And while Toyota reported an uptick in its production, the carmaker said that was unsustainable: it slashed this year’s production target from 9.7 million to 9.2 million.

Why Should I Care?

For markets: Green-eyed investors.
Not even the announcement of a $1-billion buyback program could stop investors from sending Toyota’s stock down after that news. That’s not the end of its worries either: once the eco-friendly drivers’ darling thanks to its hybrid models, increasingly green-minded investors have criticized the carmaker’s slow embrace of fully electric vehicles. That could be why Toyota’s considering revamping its $38-billion EV plan after just one year – well, and the fact it had to recall its first mass-produced all-electric vehicle over safety worries this year.

The bigger picture: Low and behold.
The yen fell to a 32-year low against the dollar last month, and Japan’s been trying to buoy it up by buying yen and selling dollars – all while maintaining its currency-squashing ultra-low interest rates. Data out this week showed Japan spent a record $43 billion on that technique last month, and it can afford to keep that going: Japan holds the world’s second-biggest foreign currency reserves after China.

You might also like: Japan’s been spending billions to slow the yen’s slide. It’s not working.

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💬 Quote of the day

“We don’t believe in rheumatism and true love until after the first attack.”

– Marie von Ebner-Eschenbach (an Austrian writer)

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🤑 Asset Allocation For Young Investors: 5pm, November 2nd
🙋‍♀️ Ladies Investing Club Meet Up: 6.30pm, November 2nd (in person)
😎 How To Build A Portfolio Ready For The Next Decade: 1pm, November 3rd

👀 And After That…

💰 Strategies For Market Volatility: 1pm, November 8th
✨ How To Profit From Special Situations As A Value Investor: 5pm, November 9th
🔧 Tools Value Investors Use For Turbulent Times: 6pm, November 10th
🔥 How To Build Better Financial Habits In Your 20s & 30s: 3pm, November 11th
♻️ How To Build An Eco Friendly Crypto Portfolio: 1pm, November 14th
💥 How To Diversify During High Inflation: 6pm, November 14th
🐻 How To Survive A Crypto Bear Market: 7pm, November 15th
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🚀 2023 Outlook: What’s Next For Crypto?: 6.30pm, November 23rd (in-person, London)
🌍 Finding Opportunities In A Challenging Market With BlackRock: 1pm, December 2nd
🎉 Modern Investor Summit: 12pm, December 6th & 7th

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Finimize - 🚗 Toyota's breaking down

Today's big stories

Finger On The Pulse

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Here’s Where Blackstone Sees Opportunities Now

Upgrade your trading experience

Fall Time

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Your brand could represent the new investing era

🥳 Coming Up This Week…

👀 And After That…

Older messages

⛏ Tesla's digging for gold

⛏ Tesla's digging for gold

💰 Big Oil's just bragging at this point

📉 Apple and Amazon's big results are in

📉 Meta's dropping off

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