Ford Plans $2.5 Billion Investment In Mexico As Question Arises On Europe And South American Markets

Investments will cover the states of Chihuahua and Guanajuato, but currency fluctuations and economic instability raises concerns

Ford Motor Company (NYSE:F) has announced a $2.5 billion investment in Mexico, taking advantage of the country’s ‘now booming’ auto market. The Dearborn, Michigan-based automaker will make an official announcement to in coming days ahead of the company’s 90th anniversary of its operations in Mexico. It is expected to create around 4000 jobs in the construction phase, and employing hundreds thereafter.

Ford will invest $1.3 billion in the Chihuahua, Mexico, where it will set up diesel engine auto part factory, whilst the remaining $1.2 billion will be spent on a transmission plant on the Guanajuato state. Most of the cars manufactured from Mexico are exported mainly to North American markets, due to its low cost labor force, and the fact that the company is Mexico’s fourth largest auto exporter.

The decision by the corporate giant to further strengthen its foothold in the Spanish speaking country comes, as a string of automakers are among their way into Mexico for the past several years, thanks to proximity to the American market, cheap labor, and a number of free trade agreements that the country has signed up. Toyota is also among its move by announcing close to $1 billion of investment, to produce over 200000 units of cars every year.

Whilst Ford has rebounded remarkably from the recession by not demanding for a bailout managing profits in nearly every nook of the world, there are some questions regarding its performance in the European and South American markets, where the dynamics of the markets there are quite different.

The European car market has not gone ‘out of the woods’ yet. Ford predicted that just like last year, 2015 would not be the year in which the company will turn around its operations. In fact, it has slashed its long-term profit forecast for the region, from $0.06-$0.08/share to $0.03-$0.05/share, by 2020.

Most of the blame goes to the Russian market that has been hit hard by economic sanctions due to the Ukrainian conflict. It was hoped that the European market will take time to turn around but still contribute to its bottom line, but that seems to be a misguided notion now. In all retrospect, Ford’s European and UK operations never add much to its earnings.

The broader fundamentals look positive, as low oil prices are helping to address the inflationary problems, but that is not going to affect the amount of corruption of the creaking infrastructure. With the October 2015 elections on the horizon, many people hope that voters get a clearer sense to vote for the one that has a clearer business outlook, but not to be labeled as pro-business, so as to not lose touch with voters.

In conclusion, Europe operations may still feel the pain for the next few years till 2017. The same will be the case in South America, but a substantial improvement is forecasted for later this year as well as next.

UnitedHealth Group Inc. First quarter 2015 Earnings preview

 UNH is scheduled to report its first quarter 2015 results on Thursday morning.

UnitedHealth Group is all set to report its January to March 2015 earnings on Thursday, April 16. During the fiscal year 2015, the company is expected to post revenue of over $140 billion and earnings per share of $6 to $6.25. The health care company surpassed market estimation last year, with earnings per share increasing from $5.50 in prior year to $5.70 in 2014.

The company was able to enhance its top line growth in spite of doubts regarding contrary impression from the Affordable Care Act, with combined revenue over passing $130 billion mark in a year. Company’s operating earnings got better by 7% on year over year basis and stood at $10.2 billion. The company got advantage from the outstanding growth throughout its divisions, mainly the Medicaid and Optum divisions.

Forbes expects UnitedHealth’s increased involvement in the next enrollment period on healthcare platforms, together with enhanced customer involvement, to influence the first quarter results of the company. Moreover, the Optum division is expected to remain on the success path. Forbes also estimated company’s target price of $105, which is marginally lower than the current stock price.

 Analysts forecasted UnitedHealth to report earnings of $1.34 per share, which is 22% higher than the last year. Revenue is most likely to surge by 9% to $34.6 billion.

Earlier this year, UnitedHealth Group said that it believes that earnings for the current fiscal year will be around $6 to $6.5 per share, and revenue forecasted in the range of $140.5 to $141.5 billion.

On Tuesday, Credit Suisse increased the target price on the company’s stock to $135 from $120, while reiterated a rating of Buy. The improvement in price target came because of UnitedHealth’s deal to acquire Catamaran Corp for almost $13.5 billion in an attempt to surge its pharmacy benefits business and arise as a big competitor in health care industry.

Almost 25 analysts, who were polled by Bloomberg specifies that most of sell side companies are bullish in company stock. 18 analysts rated the stock as Buy with 6 assigning Hold rating. The 12-month mean price target is $131.30.

At market close on Wednesday, UNH stock was down by 2.17% to $117.32.

China Mobile Switches Course By Connecting 4G In Rise Of Connected Cars

Chinese telecoms stepping into the foray of the “Internet of Vehicles” with 4G connections

China Mobile Inc.(CHL), along with other Chinese telecom operators, have announced their intention to step into the foray of the “Internet of Vehicles” by providing 4G services to an estimated more than 500000 IoV users this year.

Ren Dakai, Chief Director of Traffic Products at China Mobile, said that the company would debut its 4G service terminals next month, as they prepare for its huge market growth in the coming years. The potential customers wait impatiently after the news break to experience the new innovation first-hand.

The third largest Chinese telecom operator is not alone. Its small competitors, such as China Unicom, are also preparing for the launch of its own projects and services, but by collaborating with Tesla Motors.

The entrance into the “Internet of Vehicles” is just an extension of China Mobile having already entered into the “Internet of Things” in 2012, when it launched the driving terminal system. It has not been reconsidered since, and it is now offering services to General Motors’ range of cars from the Cadillac to the Buick vehicles.

After General Motors, which was actually a trial experiment to gauge the market reaction following the introduction of its services, China Mobile has now expanded to include other automobile manufacturers, such as Ford, Chevrolet, Kia, Toyota, and Honda, among the 20 car manufacturers.

If there is cue to be taken from the Chinese connected cars market, it is that it has raced ahead of other countries in providing services to a large market, which is a crucial aspect of China’s lead, but also how competitive it can become, despite the rising growth rate of the “connected cars”.

For Chinese and global telecom operators fighting for a market share, they will have to figure out the steps to maintain the share based on their abilities to innovate, let alone outdo one another. Cisco is already doing by taking several step ahead of its competitors in the field of smart cities, by taking it ahead and not waiting to be coerced into stepping in this foray by its competitors — and it seems to be making a good progress so far.

China Mobile’s stock price ended at $70.47, a decline of more than 1.43%, its largest fall since late 2007 following the global financial meltdown. There is apparently no trigger that has sent the stock price to a downfall from a lack of triggers or stock price quotes or any news.

Delta China Expansion Plan: Will It Work Just like the Amsterdam Model?

 

CEO Richard Anderson confident that the long term strategy used from the Amsterdam model can be replicated well enough

Delta Airlines, Inc. (DAL) CEO, Richard Anderson, envisioned creating an additional international hub in China (more precisely Shanghai) last week, as part of strengthening its relationship with China Eastern Airlines Corp.

Mr. Anderson pointed out that he attaches great importance to this route, as he wants to replicate the model to that in Amsterdam, a destination where the airline uses it as a hub to perform its operations in European or some parts of the MENA region.

Delta will initiate that process by launching flights from Los Angeles to Shanghai, which will be an addition to the flights from Seattle and Detroit to the largest city in China. Once it commences the service, Delta Airlines will co-locate with China Eastern Airlines inside the Shanghai airport.

The question is: will it work in China too? In the Pacific international airline market, Delta trails behind United, since the latter has a head start in the Chinese market by offering direct flights to secondary cities. So this strategy can be seen as a catch-up attempt by the airline, which is currently embroiled in a collision course with Gulf carriers, who are apparently being financed through subsidies. The Gulf carriers continuously and vehemently deny this claim. They seem to be responding by turning up the heat on Delta with more flights to important routes in US and specially, China.

There is no denying that there is a good deal of logic from Mr. Anderson in pushing for the idea of setting a feeder hub in Shanghai to feed the traffic into the US market. It is not without flaws though. Shanghai is ranked as the 29th busiest airport in the world, compared to Schiphol being the 5th. This means that despite millions of passengers processed from the airport, Shanghai does not receive a lot of traffic, even though a number of airlines operate there, but the China Eastern Airlines lags with other regional carriers behind in the number of destinations served. Secondly, there is little chance that the government will give the go ahead to fly between two cities in China.

The verdict: It is not a bad idea, given that the Chinese market is still huge, despite the slowdown in its economy. Delta should look into the idea of feeding their growth from China to Brazil via the US, since there is a lot of strong traffic out there now and especially as Delta has a stake at Gol, a local Brazilian airlines, providing wide range of choices for Chinese consumers to fly to various Brazilian cities.

Settlement Results In Mishap For Exxon Mobil

The settlement between court and Exxon Mobil hurts the sentiments of natives

Pollution is one of the major problems that has disrupted the safety and health of individuals across the globe. At the Newark Liberty International Airport, the passengers and staff deal with on everyday basis includes chemical pollution and crude oil. The issue is not recent but dates back to 100 years where 1500 acres of land is being plagued.
 

The issue is not just the workers and those who use the airport being affected by this pollution are the residential area inhabitants, industrial site and commercial location. Back then in 2008, it was deduced that Exxon Mobil was responsible for this and the leaks were caused because of their petroleum operation and oil refineries. The land has been contaminated because of this reason where billion of gallon of oil and other waste material have been deposited in the region giving birth to global warming and also affecting the health of the local inhabitants.

Many individuals for the same reason reported of cancer and other fatal diseases whereas a majority of them suffered from respiratory issues. Since the time Exxon Mobil (XOM) has been dragged in front of the court of law, an order has filed against them that require them to initiate a cleanup.

However, recently the final action has been taken where Exxon Mobil along with Christie administration has publicized the final outcomes of the settlement that will put an end to this legal story. This revolves around the fine that needs to be paid for disrupting natural resources and igniting health concerns among individuals.

The courts argued that the damages that have been caused worth $9 billion. However, it has finally been decided that the company will pay only a small chunk of the actual priced asked which sums up to $225 million.

This is only 2.5 percent of the damage caused but according to the state authorities this amount will be enough to deal with the losses and make life better for the local residents. However, this is mere injustice to the locals who have experienced a fairly tough time coping up with the massacre that not only took innocent lives but has ignited several health issues that demand justice.

Hence, in a nutshell Exxon Mobil is responsible for many innocent lives here and $9 billion is something massive considering the damage they have caused. Rupturing the feelings on locals who have dealth with so much for mere $225 million is injustice where the side of these locals should have been taken into consideration before passing any verdict.

CVS Health Foundation Invests $5 Million for Community Health Access And Affordability

Additional investments grants have improved access to health care coordination

CVS Health Foundation, a charitable wing of CVS Health Corporation(NYSE:CVS) has announced the start of 55 new charitable healthcare initiatives, worth around $5 million for further improvement of community healthcare access, as well as making it affordable.

The fresh investments come as the new data released by the Foundation shows that the initiatives are resulting in improved access to healthcare and increased coordination in management of chronic health diseases. It has, up to date, supported more than 150 organizations, which made efficient utilization of their disbursed funds to improve healthcare for public throughout the country, though there is room for more improvement.

Before the announcement of the new grant, the newly published KPIs from the data received depicted the following results from the previous investment grants:

1) The  grants that were previously awarded to the medical centers in 2014  has  allowed the grantees to boost  their operating hours as well as  the number of patient visits, which has concurrently resulted in a dip of patient emergency room visits, in addition to improvement in patient compliance.

2) CVS Health Foundation's provision of technical assistance to the grantees has resulted in better coordination of patient care among various healthcare centers. It has also helped in reducing patient care costs and brought improved medical outcomes for patients.

3) The Foundation's funds, being utilized by the centers, has managed to help patients in managing and preventing a range of chronic diseases, ranging from heart diseases to asthma related illness, helping to bring down avoidable healthcare expenses across the system.

For this year, the 2015 grant will continue to invest on those critical clinical healthcare initiatives, but it is now adding the use of supportive innovative medical technology, as well as boosting smoking cessation programs. Additional goal will also cover underserved patients who may not be at reach by the healthcare communities, and such services not being accessible to them.

CVS stock price ended at $102.93 on the close of day, down 0.20% from the previous day, due to lack of triggers and news, and the insider transaction of 33,384 shares worth a total of $3,421,526, putting pressure on the stock price. It was speculated previously that CVS health initiatives do not invite a lot of investors’ attention due to lack of business context, though it is highly appreciated by social activists. They believe this will help in achieving even greater stock price,

Intel Corp. and Altera no longer in Talks.

The company puts its money on promoting diversity in its workplace.

Intel Corporation (INTC)’s shares saw a decline 0.64% during the current trading session on Thursday. Intel stock price is now being traded at $31.16. Along with this the takeover talks between the two companies; Intel Corporation and Altera Corp. are falling off as the tech companies couldn't come oin agreement on price.

Last month only, the company was stated to offer a deal which topped $10 billion to Altera. It  was reported that Intel offered Altera $50-per-share range. The company was found to be interested in the chip-making business of the manufacturer and seek to acquire it, but unfortunately the talks couldn't last more than a week according to the sources.

In an unprecedented move, the company earlier last month took a step to boost diversity in its workforce. Pledging $300 million to promote a diverse workplace and boost representation of minorities and women in the silicon manufacturer.

According to their CEO, the move is unprecedented and Intel wishes to lead by example in this area. Intel is aiming to have complete diversity in its workforce by 2020 in a drive towards greater equality. The CEO Brian Krzanich stated : "It's not good enough to say we value diversity and then under-represent women and minorities" He then went on to state that inclusion was something that would affect the industry positively as a whole and that Intel was more than willing to take the initiative on the topic with the announcement of the 2020 goal.

This would be made possible by Intel offering equal opportunities in an industry dominated by male professionals of Asian and Caucasian descent. With growing buying power amongst the relatively smaller Black and Hispanic communities, which are also expected to overtake the white population by 2044 in the US, technology companies are showing hesitance in adapting to the change in demographics and employing a more diverse population.

The investments will not only represent direct hiring by the company; investments will also be made to cultivate a better employed work force from the ground up. This would see investments made by Intel directly at a college and school level and increased university exposure to allow it to hire a workforce that is concentrated on equality. Of important note however, is that while Intel has committed to the program, it should not affect its long term financial goals and the CEO is willing to stake his claim on it, stating : "This isn't just good business. This is the right thing to do."