Today's big stories

PepsiCo reported better-than-expected second-quarter earnings
Our analysts ask if there's any value left hidden in the stock market – Read Now
Analog Devices has agreed to buy rival chipmaker Maxim Integrated Products

1/3

Snackhanded Compliments

What’s Going On Here?

Shares of PepsiCo rose 3% on Monday after the giant announced better-than-expected quarterly results – and its snacks business’s cheesy fingerprints were all over them.

What Does This Mean?

Even though Pepsi’s revenue last quarter was 3% lower than the same time last year, it was still higher than analysts predicted – and the company’s quarterly profit beat expectations too. That lower revenue might’ve been because Pepsi sold fewer drinks in North America, its biggest market. Grocery stores enjoyed a pandemic-driven pickup, sure, but the shuttering of restaurants, bars, and sports arenas largely wiped out demand for soda. Still, at least the company’s snacks business grew last quarter: clearly folks were hankering after long-life essentials like Quaker Oats as much as they were feelgood treats like Cheetos…

Why Should I Care?

For markets: Keep ‘em guessing.
Most companies – Pepsi included – decided against providing forecasts for the second quarter after seeing the early damage coronavirus had done to their businesses. So analysts have essentially had to guess how they’ve been performing. Pepsi didn’t exactly offer much guidance for the future either, admitting on Monday it was still too early to make financial predictions about the rest of 2020. Going forward, then, those analysts will need to rely more on passing comments the company makes about what it’s seeing at its stores and in its factories, as well as what customers have been saying.

The bigger picture: So near, yet so far.
With most US companies opting out of predictions right now, analysts have spent more time than usual digging through the numbers to generate their forecasts. That tends to result in a wider gap between the highest and lowest estimates, and a greater chance that companies will beat or miss them dramatically (tweet this). But since most investors are well aware of that, it’s likely we’ll actually see less frantic buying or selling of stocks once the quarterly updates are in.

Get invested: Three things you need from a broker during earnings season.

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2/3 Premium

The Search For Value

What’s Going On Here?

The relative performance of costly “growth” stocks versus cheaper “value” stocks hit an all-time high at the end of June – and investors are wondering if there are any needles left to be found in this here stock market haystack.

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3/3

True Friendchip

What’s Going On Here?

Chipmaker Analog Devices announced plans to buy rival Maxim Integrated Products for $21 billion on Monday, and they just know they’re going to be friends forever.

What Does This Mean?

The merger – potentially one of the biggest this year – is an “all-stock” deal. That means Maxim’s shareholders will receive Analog’s shares – 0.63 for each Maxim share they hold – as payment. When all’s said and done, Analog’s existing shareholders will own about 69% of the combined company, and former Maxim investors will own the rest.

Both companies produce semiconductors used by almost every industry in the world. More specifically, Analog has tended to focus on sensors and signal-processing products, while Maxim is more geared toward microchips for the autos and industrial industries. Maxim’s specialties in particular are up against stiff competition in the form of rival firm Texas Instruments – and the two companies might be hoping that they’ll be more formidable together than apart.

Why Should I Care?

For markets: Muted celebrations.
Maxim’s stock rose 11% on Monday. That’s a long way short of the 22% increase that Analog’s offer implies the shares are worth, which might reflect the widespread concern that regulators will block the deal. Analog’s share price, meanwhile, fell 4%, likely because there’s a risk that the $275 million the companies are promising they’ll save won’t actually happen. Still, that drop might’ve been a lot bigger if Analog hadn’t raised its revenue forecast for this quarter, thanks to strong demand from customers in the industrial and communications industries.

The bigger picture: Showing off their semis.
The semiconductor industry’s seen plenty of deals in recent years, which is no real surprise when you consider the increasingly global scope of an industry that produces chips for every electrical item you can imagine. And the trend now seems to be spreading to its industrial customers too: Swedish engineering giant Alfa Laval agreed on Monday to buy Finnish valve-maker Neles for $2 billion.

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💬 Quote of the day

“Above all, be the heroine of your life, not the victim.”

– Nora Ephron (an American journalist, writer, and filmmaker)

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🌎 Finimize Community

🎤 Take it away, Paul

What does the future hold for Asia and its economy? Erm, good question. We’re going to hand over to Hong Kong Community Director Paul and his panel of experts for this one…

🇭🇰 Hong Kong: Imagining Asia’s Next Decade – 9pm Hong Kong Time, July 14th
🇩🇪 Germany: Is Cash Still King in Germany? – 3pm Berlin Time, July 15th
🇺🇸 USA: IP Risk During A Pandemic – 11am New York Time, July 15th
🇺🇸 USA: How To Build An Anti-Racist Startup – 1pm New York Time, July 16th
🇺🇸 USA: What’s Next For Streaming? – 12pm New York Time, July 20th
🇬🇧 UK: Global Economic Outlook – 5pm UK Time, July 21st
🇦🇺 Australia: Women & Money (in-person) – 5.30pm Perth Time, July 22nd
🌎 Global: Finimize Live AMA – 1.30pm UK Time, July 28th
🇨🇦 Canada: Searching For Financial Stability – 1.30pm Pacific Time, July 28th
🇬🇧 UK: What’s Next For The Global Economy? – 6pm UK Time, July 29th
🇬🇧 UK: The Bright Future for Renewable Energy – 12pm UK Time, July 30th

The “Should I buy that house?” checklist

If you’re thinking of buying your own place while things are a bit quieter, there are a few questions you should be asking yourself…

⏰ Should I be worried about the economy?
First things first, you need to take a big-picture look at what the economy actually looks like right now.

📉 How will a recession affect me and my money?
Recessions are the current hot topic, and they affect everyone differently: find out if you’re at risk.

🤔 Should I rent, or should I buy?.
There are pros and cons to both, so you’ll need to set about deciding if buying really is right for you.

🇬🇧 I’m a Brit. Where do I start?
So you want to buy yourself a bit of Blighty: here’s what you need to know.

🇺🇸 I’m American. How do I go about buying?
America’s a little different to the Britain. Get up to speed on the US market.

📚 What we're reading

Last week was a weird week (Input)
Machines are, like, so not random (Nautilus)
A little something for those hot summer months… (Popular Mechanics)

Finimize - 🥤 Pepsi crushes Coke

Today's big stories

Snackhanded Compliments

What’s Going On Here?

What Does This Mean?

Why Should I Care?

The Search For Value

📣 Make your brand heard

True Friendchip

What’s Going On Here?

What Does This Mean?

Why Should I Care?

🎤 Take it away, Paul

The “Should I buy that house?” checklist

Older messages

🎟 New events: IP risk, streaming's future, and how to be anti-racist

🏦 JPMorgan is the best bank ever

📉 China tanks stock market

🧐 Goldman predicts the US election

⏰ Jack Bauer’s 4 billion deal

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