Has Google Inc.'s (NASDAQ:GOOG) "Google Checkout" online payment and transaction system gained on eBay's established PayPal online transaction service in recent months? Google Checkout has only been available for less than a year, and really it's only been in full-scale use (not in beta) since last summer. While Google Checkout has increased its visibility -- a large partnership with online retailer buy.com comes to mind -- is it making inroads to take marketshare from leader PayPal, a division of eBay?
According to a new report from J.P. Morgan, Google Checkout still has a long way to go before catching up -- and competing with -- eBay's PayPal. While not that much time has gone by from the launch of Google Checkout, a recent customer satisfaction survey hints at problems with customer satisfaction that could hold Google Checkout in check -- with little growth over the rapid 6% marketshare it has now.
An article over at arstechnica.com states that Google Checkout may be failing to impress its early-adopting audience. That could be a crucial mistake for any web service trying to grow from infancy to established competitor. Shudders follow: only 18.8% of Google Checkout users reported having a "good" or "very good" experience with the service while 81.2% indicated a fair to poor experience.
Things weren't that pretty over at eBay Inc. (NASDAQ:EBAY) in previous quarters as eBay stock declined 34% in the past year taking it to a low of $22.83 in August. Last quarter, however, eBay charmed the Street when it reported third-quarter financial results. Even Cramer did a backflip and considers eBay a value Internet stock. The stock climbed from its August low to hover around $30 lately.
For fiscal 2006 fourth quarter, consensus analyst estimate calls for earnings of 28 cents per share, in line with the company's guidance, and up from 20 cents last year. eBay gave revenue guidance for Q4 2006 to be in the range of $1.615 billion to $1.675 billion. According to Thomson, analysts call for a 25% growth in sales to $1.67 billion.
eBay will be reporting Wednesday January 24th after the close, and I'll liveblog the webcast beginning 2 p.m. Pacific, 5 p.m. Eastern. It will be interesting to see how eBay does. Here's what analysts (and I) expect to hear:
Amazon.com Inc. (NASDAQ:AMZN) was upgraded to buy from hold at Stifel Nicolaus. Merrill Lynch, on the other hand, sees pressure on Amazon shares before the company reports earnings. AMZN shares are up 1.3% in pre-market on the upgrade.
Hewlett-Packard Co. (NYSE:HPQ) announced it plans to open a research and development facility in St. Petersburg, Russia.
International Business Machine Corp.'s (NYSE:IBM) Lotus unit will introduce today a set of social networking services that functions like a MySpace for office workers. This could renew the rivalry with Microsoft Corp. (NASDAQ:MSFT). IBM is expected to collaborate with Hewlett-Packard and Intel Corp. (NASDAQ:INTC).
France Telecom is considering dropping Yahoo Inc (NASDAQ:YHOO) as the supplier of advertising to its Internet portal, the Financial Times reported.
Reporting this week:
Johnson & Johnson (NYSE:JNJ) reports Tuesday. Analysts expect it will earn 79 cents per share for the fourth quarter.
Still Tuesday, United Technologies Corp (NYSE:UTX) is expected to report earning of 85 cents per share.
Also on Tuesday, Yahoo Inc. (NASDAQ:YHOO and Sun Microsystems Inc. (NASDAQ:SUNW) are expected to report.
eBay Inc. (NASDAQ:EBAY) should report fourth quarter results on Wednesday. Wall Street is looking for earnings of 28 cents per share.
Still on Wednesday, McDonald's Corp. (NYSE:MCD) is reporting and is expected to earn 61 cents per share.
Thursday will see Ford Motor Co. (NYSE:F) and Microsoft Corp. (NASDAQ:MSFT) reporting. Ford is expected to show a loss of 97 cents per share for its fourth quarter. Microsoft is expected to earn 23 cents per share for its fiscal second quarter.
AT&T Inc. (NYSE:T) will also report Thursday.
Caterpillar Inc. (NYSE:CAT) is scheduled to report fourth-quarter on Friday. Analysts expect earnings of $1.34 per share. CAT closed at $59.37 on Friday. Its 52-week range has been $58.82 to $82.03.
Fortune has this great article on a company and product called Parallel, that allows both Apple Inc. (NASDAQ:AAPL) and Microsoft Corp. (NASDAQ:MSFT) operating systems to run on the same system. Fortune has another great article about forecasting auto industry trends, winners and losers for 2007. In 2006, six of General Motors Corp.'s (NYSE:GM) brands lost ground. Sic of Ford's (Ford, Lincoln, Mercury, Volvo, Jaguar and Aston Martin) and all three of DaimlerChrysler's (NYSE:DCX) U.S. brands (Chrysler, Dodge, and Jeep).
Marketing firms Landor Associates and Penn Schoen & Berland have come out with their annual study of how consumers think certain major brands performed in 2006 and were likely to do in 2007.
This list points out the disparity between perceptions of brands and how well the brand companies do, at least in the stock market.
The first brand on the list is an exception. Google (NASDAQ:GOOG) was ranked as the hottest brand of 2006 and was predicted to be the hottest brand this year. No one who has owned the stock would argue. Another good match between a hot brand and a stock price is the iPod, which ranked very high. Apple's (NASDAQ:AAPL) share price had a nice move in 2006. But, in the cases of both Apple and Google, their big moves came before last year.
Perhaps the brand perception is an indicator that a stock's best move up is behind it.
Yahoo! (NASDAQ:YHOO) and eBay (NASDAQ:EBAY) are both on the 2006 list and make it for 2007 as well. Investors certainly wish that being high on the list would have saved them from large stock price declines over the course of last year. The same holds true for Amazon (NASDAQ:AMZN), which made the cut of the 20 hottest brands. Sony (NYSE:SNE) is on the list, too. That hasn't worked out too well for shareholders.
Making the top 20 list was not a disaster for all public company share prices. Verizon (NYSE:VZ) is on the list and did well. The same holds true for Target (NYSE:TGT) and Starbucks (NASDAQ:SBUX).
But, brand performance and stock performance don't match up in most cases.
January's earnings period continues, with Texas Instruments (NYSE: TXN), Sun Microsystems (NASDAQ: SUNW), eBay Inc (NASDAQ: EBAY), AT&T (NYSE: T) and Halliburton (NYSE: HAL) all reporting this upcoming week.
Monday January 22
Pfizer (NYSE: PFE) to hold a strategic update meeting at 1pm. Deutsche Bank believes the meeting will focus on Exubera and will discuss the drug positively.
Target (NYSE: TGT) to hold its January mid-month sales call at 4pm. Investors will be looking at the strength of sales after the holiday season.
Texas Instruments to report Q4 earnings; conference call at 5:30pm. The focus here will be on the company's product mix, cost controls, market penetration rates, and margins. Additionally, the Street will also be looking at Texas Instruments' comments on product development and the future role it sees for semiconductors, particularly in wireless devices.
FDA PDUFA date for Wyeth's (NYSE: WYE) Desvenlafaxine.
Tuesday January 23
Sun Microsystems to report Q2 earnings; conference call at 4:30pm.
FDA PDUFA Date for GlaxoSmithKline's (NYSE: GSK) Coreg
Wednesday January 24
eBay to report Q4 earnings. Investors will look for comments on sales during the 2006 holiday season, the recent acquisition of Stubhub.com and the performance of Paypal.com against fledgling challenger Google Checkout.
Atlantic City Council Meeting to hold vote on smoking ban at 5pm. If passed, this would be a negative for the casino sector, as it would ban smoking on the floors of Atlantic City casinos.
Thursday January 25
AT&T to report Q4 earnings; conference call at 10am.
Icos Corp (NASDAQ: ICOS) to hold a special shareholder meeting at 2pm to vote on the revised merger agreement with Eli Lilly (NYSE: LLY). Note that HealthCor Management, which holds a 5.24% stake in Icos, plans to vote against the proposed acquisition.
Friday January 26
Halliburton to report Q4 earnings; conference call at 10am. Investors will be looking for comments on oil services, as well as new contracts relating to government services.
Apple Inc.'s (NASDAQ:AAPL) iPhone gross margins are estimated at over 50%, giving the company plenty of room to eventually reduce the retail price, according to iSuppli Corp.
Shares of Web retailers fell yesterday on the Nasdaq: Amazon.com Inc. (NASDAQ:AMZN) shares lost 3%, eBay Inc. (NASDAQ:EBAY) 1.5%. Prudential analyst Mark Rowen says results from other retailers point to an unimpressive fourth quarter for Amazon.com. Noble Corp.'s (NYSE:NE) Barnes & Noble Inc. and Borders Group Inc. sales during the holiday season were also lacking.
In an interesting move, major corporations are joining environmental groups to press Bush and Congress to address climate change more rapidly. The group includes: Alcoa Inc. (NYSE:AA), General Electric Co. (NYSE:GE), DuPont Co. (NYSE:DD), Caterpillar Inc. (NYSE:CAT), PG&E (NYSE:PCG), BP (NYSE:BP), Lehman Brothers (NYSE:LEH) and Duke Energy Corp. (NYSE:DUK).
Toyota Motor Corp. (NYSE:TM) is recalling 533,000 Tundra pickup trucks and Sequoia sport utility vehicles because of potential steering problems.
McDonald's Corp. (NYSE:MCD) opened its first drive-thru in Beijing on Friday (16th in China).
A House of Representatives vote to roll back tax breaks and other incentives for oil drilling could choke about $14 billion in subsidies from the "Big Five" integrated oil companies: BP PLC (NYSE:BP), Exxon Mobil Corp. (NYSE:XOM), Chevron Corp. (NYSE:CVX), ConocoPhillips (NYSE:COP), and Royal Dutch Shell.
Wal-Mart Stores Inc. (NYSE:WMT) is opening an energy-efficient stores that use 20% less energy than other Wal-Mart Supercenters.
After dropping more than 6.7% yesterday, Red Hat Inc. (NYSE:RHT) was upgraded by CIBC World Markets from Sector perform to Sector Outperform.
Altria Co. (NYSE:MO) was downgraded by Deutsche Securitites from Buy to Hold.
Apple Inc. (NASDAQ:AAPL) shares are down 1.7% in pre-market. Despite the cautious outlook and JP Morgan downgrading the stock, analysts in general still think its position is strong.
Amazon.com Inc. (NASDAQ:AMZN) and eBay Inc. (NASDAQ:EBAY) -- European online retailers did good business this holiday season, probably increasing sales by over 30% from a year ago. Amazon and eBay didn't give exact information though.
Ford Motor Co.'s (NYSE:F) chief said yesterday that the number of bankruptcies among auto parts suppliers could rise further this year with a spike to a new high next month.
General Motors Corp. (NYSE:GM) yesterday said it sold 9.1 million cars and trucks worldwide in 2006, a drop of less than 1% from the 9.2 million vehicles it sold in 2005
Hewlett-Packard Co. (NYSE:HPQ) and Dell Inc. (NASDAQ:DELL) -- technology research firms IDC and Gartner Inc. showed HP outpaced the rest of the market and led the worldwide PC sales for the second sequential quarter holding 17-18% market share compared to Dell's 14-15%.
Motorola, Inc. (NYSE:MOT) said it's won a contract with India's Mahanagar Telephone Nigam Limited to build a third-generation UMTS network in Dehli and its neighboring region.
Pfizer Inc. (NYSE:PFE) -- European regulators have approved Pfizer's Sutent as an initial treatment for advanced kidney cancer and granted the product full marketing authorization.
Starbucks Corp. (NASDAQ:SBUX) claims it paid more per pound for its coffee in 2006.
Sirius Satellite Radio Inc. (NASDAQ:SIRI) was upgraded by Bear Stearns from Underperform to Peer Perform. Hopes of a merger were dampened by the FCC yesterday, causing SIRI and XM Satellite Radio Holdings Inc. (NASDAQ:XMSR) shares to plunge.
Grocery retailers are assessing the impact California's freeze will have on supplies and the prices of citrus, strawberries and other damaged crops in their stores. This could affect Wal-Mart Stores Inc. (NYSE:WMT), Whole Foods Market Inc. (NASDAQ:WFMI), Kroger Co. (NYSE:KR) and more.
Yahoo! Inc. (NASDAQ:YHOO) might be better off as a privately held company and is a good candidate for a leveraged buyout, an analyst wrote Thursday, though he said the huge size of the deal would make it unlikely.
Google Inc.'s (NASDAQ:GOOG) online payment service, Google CheckOut, does not seem to have taken much business from eBay Inc.'s (NASDAQ:EBAY) PayPal. At least not according to a look at the Ebay 10-Q.
But, Google, always one to pull out all of the stops, is running a promotion on its homepage, which gets over a zillion pageviews a day. The deal: use CheckOut and get a $10 bonus when purchasing goods and services from a number of sites. These merchants include Starbucks Corp. (NASDAQ:SBUX), ToysRus, Petco, and Ace.
The move could actually take some share from PayPal because of the huge exposure that the program gets on the Google homepage and the large amount of money that it would appear that Google is willing to spend.
With PayPal as one of the cornerstones of eBay's success, it isn't good news for the online auction company.
In a move that is probably a direct result of all the recent media attention -- and reality -- of scams on eBay Inc.'s (NASDAQ:EBAY) PayPal division involving payments and transactions (and identity theft), the company said that it will soon be providing "key fobs" that will be required to login to one's PayPal account, in addition to usernames and passwords.
These electronic security measures have codes that change every 30 seconds, so even a thief armed with a stolen username and password from a PayPal account (gleaned from a fake PayPal email) will have a virtual stop sign now that this third security measure will be in place.
Is eBay doing the right thing? Absolutely. The safeguarding of personal information and financial accounts for its customers should be a top priority. Although the fobs will be given to business PayPal customers first, regular PayPal customers will have access to the free devices soon as well. Are the days at an end to eBay and PayPal phishing scams? We will all have to see.
Apple Inc. (NASDAQ:AAPL) -- Fortune Magazine takes another look at the SEC's investigation into Apple's CEO, Steve Jobs, raising some interesting points.
Intel Corp. (NASDAQ:INTC), which is due to report quarterly earnings after the close today, plans on closing its chip plant in Jerusalem and may sell its flash-memory activities at its Kiryat Gat plant in southern Israel, according to an Israeli newspaper. Intel refused to comment.
Nokia Corp. (NYSE:NOK) was upgraded by Goldman Sachs to buy from sell. Goldman believed all the bad news from Apple's launch of the iPhone and Motorola Inc.'s (NYSE:MOT) warning, along with the bottom of its cycle, have passed and it expects the stock to rebound from here.
eBay Inc. (NASDAQ:EBAY) -- BusinessWeek.com has another take on the StubHub deal.
A sharp rise domestic luxury brands failed to offset weaker demand in other key car markets in Germany as most car companies and models saw lower sales.
Citigroup Inc. (NYSE:C) might rebrand itself with a shorter name - "Citi."
Coca-Cola Co. (NYSE:KO) -- The trade secret trial where a company's secretary alledgedly took confidential documents and samples with the intent of selling them to PepsiCo. (NYSE:PEP) is set to begin.
Hewlett-Packard Co. (NYSE:HPQ) today announced research that could lead to chip Improvements. The alternate strategy is the creation of field programmable gate arrays (FPGAs) up to eight times denser - while using less energy for a given computation - than those currently being produced.
Cisco Systems Inc. (NASDAQ:CSCO) -- Prudential cut its rating to neutral from overweight and Banc of America lowered its rating to neutral from buy.
Motorola Inc. (NYSE:MOT) -- Goldman Sachs resumed coverage with a neutral rating.
Sony Corp. (NYSE:SNE) said on Tuesday it has shipped 1 million PlayStation 3 game consoles in Japan, but speculation is rising that the company would fall far short of its 6 million global shipment target by March as it battles Microsoft Corp.'s (NASDAQ:MSFT) Xbox 360 and Nintendo's Wii for the top spot in the $30 billion game market's console war.
Starbucks Corp. (NASDAQ:SBUX) -- Today, the paczki - a popular Polish pre-Lenten pastry - is putting in an appearance for patrons at about 60 area Starbucks outlets in the Detroit-area.
Baidu.com Inc. (NASDAQ:BIDU), also dubbed China's Google, said on Tuesday that it and EMI Music are launching an advertising-supported online music service in China. Google Inc. (NASDAQ:GOOG) is also trying to break into the Chinese video market.
Sirius Satellite Radio Inc. (NASDAQ:SIRI) and XM Satellite Radio Holdings Inc. (NASDAQ:XMSR) were both upgraded by J.P. Morgan to overweight from neutral. Banc of America downgraded XM to neutral from buy.
It's been a couple of days and it's time to see how the Street reacted to eBay Inc.'s (NASDAQ:EBAY) recent purchase of StubHub Inc.
Before the purchase, when the announcement wasn't official yet, I said that this acquisition is a good one, taking care of competition and giving eBay a bigger market share of the ticket reselling business.
First, eBay share gained back 3.17% of their value yesterday, as investors obviously reacted positively. What about analysts?
Mary Meeker of Morgan Stanley expects the purchase to reaccelerate growth for the company. Meeker has an "Outperform" rating on EBAY and expects StubHub to help eBay's struggling tickets category whose growth dropped to 19% in the fourth quarter of 2006 from 31% a year earlier.
Robert S. Peck of Bear Stearns even thinks that with StubHub, eBay could become a "formidable competitor" to the largest online ticketing platform, Ticketmaster and its TicketExchange. Ticketmaster is owned by IAC/InterActiveCorp. (NASDAQ:IACI).
Jeetil Patel of Deutsche Bank who has a Hold rating on EBAY warns that the core business continues to struggle. He is more cautious.
Douglas Anmuth of Lehman Brothers believes the acquisition is a good fit strategically.
Justin Post of Merrill Lynch thinks that with StubHub, eBay will probably control 40% of the secondary ticket market.
So there you have it. While ticketing is a relatively small business for eBay overall, I think investors were simply happy to see a good and positive move on part of the company.
A good leading indicator of stock market performance is looking at the leading Internet companies. So far in 2007, the leading internet companies are doing quite well:
Search is doing well (Yahoo and Google), the physical network of the Internet is also doing well (Level 3 and Sun), but internet retailing is having a tough time early on (ebay and Amazon).
Overall, the strong performance of these leading companies is a good sign for the market. Often, the best of the best take off way before the market does. This strong start in 2007 bodes well for tech in 2007.
CES Crowd Favorites While rival DVD formats duke it out on the show floor, Windows Vista gets bedecked with gear and Sharp surprises with one massive TV. Gallery of Winners at CES This Year
10 New Tax Laws You Need to Know Lawmakers were busy in 2006, so be sure to check out these tax code changes. They might save you some money. 10 new tax laws you need to know - Bankrate Also: Old Laws, New Amounts -- These five adjustments to existing tax laws also could affect your tax bill. Old tax laws, new amounts - Bankrate
Best Values in Public Colleges These schools offer top-notch academics at affordable prices. In Kiplinger's exclusive rankings, we give you the top 100 public schools that, in our judgment, combine outstanding value with a first-class education. Ranking No. 1 is the University of North Carolina. Best Values in Public Colleges - Kiplinger.com See List of Top Schools
Are You Ready for Real ID? A big change is just a year and a half away. It is called the Real ID Act, and if it takes effect as it currently stands, it will change the way you board airplanes, open a bank account, enter a federal building, apply for a driver's license or get government aid and Social Security. Basically, you will need to get a federal ID if you interact with any agency that is under federal mandate to protect your privacy (bank, hospital, doctor, the drug store). The act forbids federal agencies from accepting state driver's licenses as IDs unless the states enact much higher levels of security than they have now. Are you a citizen? Prove it
Cloned Foods, Coming to a Store Near You Ready for cloned burgers? It may take a few years, but products from cloned animals are coming to supermarket shelves. Here's a look at how cloning will affect products consumers see on supermarket shelves in the years ahead. Cloned Beef Burgers: "Delicious"- BusinessWeek
Retirement Savings: 5 Tips to Catch Up Worried that your nest egg is undernourished? Here are some smart and sensible ways to get that golden-years savings plan back on track. Retirement Savings: Five Tips to Catch Up
A Nokia Corp. (NYSE:NOK) exec saidApple Inc.'s (NASDAQ:AAPL) iPhone is an interesting product, but its sales goal is not very high since it lacks a few essential features, such as 3G, which would enable fast data connections.
Dell Inc.'s (NASDAQ:DELL) head of its commercial business group, Joe Marengi, would retire in March. Dell plans to split that unit into two.
eBay Inc. (NASDAQ:EBAY) - the reaction to eBay's purchase of StubHub among analyst have been positive. Morgan Stanley analyst Mary Meeker expects the purchase to reaccelerate growth for the company. Bear Stearns analyst Robert S. Peck even thinks the combined operation could successfully compete against Ticketmaster, which operates ticket auction TicketExchange.
Toyota Motor Corp. (NYSE:TM) raised its forecast for this year's vehicle sales growth in China to 40% from 33% after General Motors Corp. (NYSE:GM) said recently that it expected to beat its projected 15% growth in 2007 in China.
Hewlett-Packard Co. (NYSE:HPQ) saga is far from over. Yesterday, Federal prosecutors charged a low-level private investigator for his alleged role in Hewlett-Packard Co.'s boardroom spying scandal, but the way he was charged suggests he's likely cooperating with investigators aiming for more high-profile targets.
Lehman Brothers cut the European major pharmaceutical sector to "neutral" from "positive," saying it prefers the U.S. major pharmaceutical sector.
Starbucks Corp. (NASDAQ:SBUX) is making its next book selection to be sold in its stores: "A Long Way Gone: Memoirs of a Boy Soldier," by Sierra Leone native Ishmael Beah.
Wal-Mart Stores Inc. (NYSE:WMT) said employee enrollment in its health insurance plans increased by 8%.
Stock futures are basically flat in early morning, pointing to a possible flat open for stock markets.
Oil prices declined by 2% to a 19-month low of under $53 a barrel. Even news of Saudi Arabia complying with OPEC cuts didn't manage to give oil a boost. While lower oil prices is generally better for the economy, it isn't good for oil & gas companies and hence tends to have a mixed effect on the markets.
While Asian markets generally closed down, European markets are generally positive despite Bank of England's surprise rate hike of 0.25% to 5.25%.
The economic calendar is light today and comprises of weekly initial jobs claims due at 8:30 a.m. and the December Treasury budget due at 2:00 p.m.
In corporate news:
I announced it when Cisco first launched its own VoIP phone called the iPhone. When Apple Inc. (NASDAQ:AAPL) launched the iPhone the other day, it was understood that Cisco Systems Inc. (NASDAQ:CSCO) and Apple are close to agreeing on the use of the name. Now, Cisco is suing Apple, asking the court to forbid Apple to use the trademark its been holding since 2000 - iPhone. Here are Sarah Gilbert and Brian White's takes.
After rumors swirled around yesterday regarding eBay Inc. (NASDAQ:EBAY) buying StubHub, it was officially announced. The final price tag of $310 million was close to the rumored $300 million.
Genentech Inc. (NYSE:DNA) reported after the close yesterday, posting a 75% jump in earnings. Excluding accounting expenses, earnings from ongoing operations were 61c per share, beating analysts' forecast by a nickel. Expect DNA to be in focus today as price target for the stock was raised by four different firms. Shares are up 1.5% in pre-market trading.
It seems that Toyota Motor Corp. (NYSE:TM) cannot keep up with demand in the U.S. It may, therefore build as many as five North American assembly plants in the next 10 years.
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Has Google Inc.'s (NASDAQ:GOOG) "Google Checkout" online payment and transaction system gained on eBay's established PayPal online transaction service in recent months? Google Checkout has only been available for less than a year, and really it's only been in full-scale use (not in beta) since last summer. While Google Checkout has increased its visibility -- a large partnership with online retailer buy.com comes to mind -- is it making inroads to take marketshare from leader PayPal, a division of eBay?
Main market news 
In a move that is probably a direct result of all the recent media attention -- and reality -- of scams on eBay Inc.'s (NASDAQ:EBAY) PayPal division involving payments and transactions (and identity theft), the company said that 
Main market news 
