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Tag: leisure

  • This Barbie ‘holy grail’ doll is on sale for $25,000 — but one rare Barbie collectible could fetch $1 million

    This Barbie ‘holy grail’ doll is on sale for $25,000 — but one rare Barbie collectible could fetch $1 million

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    With the release this weekend of the new “Barbie” movie starring Margot Robbie and Ryan Gosling, there’s growing attention being paid to the world of Barbie collectibles. As in the hundreds of dolls that have been released over the years, to say nothing of such accessories as Barbie outfits and furniture.

    But there’s one collectible above all — the holy grail of Barbies, if you will. We’re referring to Barbie No. 1, the first doll ever released by Mattel to bear the Barbie name, dating from 1959.

    Barbie fanatics speak of it in reverent terms. “I lost sleep over this doll,” one collector said in a YouTube
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    video that documented the arrival and unboxing of a Barbie No. 1.

    Needless to say, collectors will pay a pretty penny for a Barbie No. 1. Prices can easily reach $10,000-plus, according to Barbie experts. The original doll sold for about $3, but there’s a Barbie No. 1 doll on eBay
    EBAY,
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    currently going for $25,000.

    But before you plunk down five figures for an investment-grade doll, we figured you might want to know a little more about this one-of-a-kind Barbie. Here goes:

    What makes the ‘Holy Grail’ Barbie so special?

    Obviously, it’s all about being the first of its kind, not unlike a baseball player’s rookie card (the 1952 Mickey Mantle card is often considered the holy grail of sports collectibles, though that can sell for millions of dollars). It’s also about rarity. Experts say around 300,000 to 350,000 of those debut Barbies were sold in 1959, but the number of Barbie No. 1s that survived throughout the years — dolls are sold as toys, after all, not necessarily collectibles — is considerably less.

    (Mattel
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    -0.42%
    reportedly now releases about 60 million Barbies annually, but the company didn’t respond to a MarketWatch request for comment and information.)

    There’s also something to be said for No. 1’s distinct look, marked by what veteran Barbie appraiser Dr. Lori Verderame describes as its “deep profile” with a protruding nose and high forehead. It’s a design very much inspired by the German-made Bild Lilli dolls that intrigued Barbie creator Ruth Handler.

    Are there any really rare examples of the original Barbie?

    Red-headed Barbie No. 1s are known to exist. Marl Davidson, a Barbie dealer based in Bradenton, Fla., says she once sold one for $50,000, and perhaps the holiest of holy grails is a salesman’s Barbie sample case dating from the doll’s early years. Davidson says she believes only two or three are around. And one surfaced? “It could go for $1 million,” she says.

    And what makes some Barbie No. 1s more valuable than others?

    As with almost any collectible category, it’s all about condition. Barbie buyers are looking for a No. 1 that’s as close to mint condition as possible, with all the original items — namely, the box, black stand, sunglasses, shoes, brochure and zebra-striped swimsuit. (There are also outfits and accessories dating from Barbie’s early years, but these were sold separately; Verderame says a popular outfit from this period can sell for $150 to $200.)

    Ironically, if the Barbie has stayed in the original box, it may affect the condition — Verderame explains that the packaging is acidic so it can “damage the piece over time,” but she says collectors still “want it in the box.”

    Then, there’s the hair color. The original Barbie came in both blonde and brunette versions. Verderame says the blondes are generally more sought after since that’s what most people think of as the Barbie classic. But Davidson says brunettes can actually have value since there were fewer made of them. Then again, she says, the collectors “who can afford it will have one of everything.”

    How can you tell if a first-edition 1959 Barbie is a fake?

    There are various elements that will signify an original Barbie — most notably, a marking on the doll’s, um, right buttock (this also applies to later Barbies, though). Also look for holes in the feet and what the Doll Reference site describes as “tight curly bangs,” among other identifiers. It’s worth keeping in mind that you might find an original No. 1 doll, but with other parts that are not original — say, a replacement stand.

    What’s the current market for the original Barbie?

    It’s soaring because of the movie, Verderame says. She notes that Barbie No. 1s that went for $10,000 as recently as three months ago are now selling in the $15,000-$25,000 range. Verderame anticipates the market will cool off after the fervor for the Warner Bros.
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    film dies down. But Davidson remains bullish on Barbie’s longer-term prospects because of the doll’s iconic appeal: “The price can only go up,” she says.

    Are there any affordable alternatives to a first-edition Barbie?

    Davidson says collectors can also consider Barbie No. 3 as a collectible. It’s a very early model, but it has a far more approachable price — Davidson says collectors can find one between $1,000 and $3,000.

    If you want something way more affordable that still has potential to appreciate, Verderame says to consider iconic Barbies from the 1990s and 2000s that are currently selling for between $50 and $150.

    But if you insist on a Barbie No. 1, Davidson says you can always buy one in lesser condition for a lesser price. Still, even a bald Barbie No. 1 won’t come cheap, she warns. “It’s going to go for a couple of grand,” she says.

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  • FTC files appeal, again seeks to block Microsoft-Activision deal

    FTC files appeal, again seeks to block Microsoft-Activision deal

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    The Federal Trade Commission on Thursday asked an appeals court to temporarily block Microsoft Corp.’s $69 billion acquisition of Activision Blizzard Inc. while it challenges a ruling earlier this week green-lighting the deal.

    The FTC on Thursday asked U.S. District Judge Jacqueline Scott Corley to postpone her ruling — which she promptly denied — and also appealed to the Ninth U.S. Circuit Court of Appeals in San Francisco to pause the acquisition “to preserve the status quo” while the case is reviewed, claiming it is likely to succeed in its appeal.

    According to the filing, the FTC claims the judge applied the wrong legal standard to its request for a preliminary injunction, and erred in a number of other matters.

    The deal is set to close in the coming days, and letting it happen will “irreparably harm the public interest and the FTC,” regulators said.

    Also see: GOP blasts FTC Chair Khan as a ‘bully’ after agency’s loss in Microsoft case

    In a response filed with the court, Microsoft said the FTC “failed to carry its burden on independent, fact-based grounds” and “dragged its heels” before appealing.

    “The court has already found that it would be inequitable” to order an injunction that could lead to “the potential scuttling of the merger,” Microsoft said, in asking for the FTC’s request to be denied.

    The FTC has claimed the tie-up of a major videogame platform — Microsoft’s
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     Xbox — with a major videogame publisher — Activision
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     makes the wildly popular “Call of Duty,” among other titles — would be harmful to the videogame industry and consumers.

    Microsoft has pledged to keep “Call of Duty” available to Sony’s
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     PlayStation console for 10 years, and will make it available for Nintendo’s 
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     Switch and some cloud-gaming platforms.

    In her ruling clearing the deal Tuesday, Corley said the FTC did not show “this particular vertical merger in this specific industry may substantially lessen competition.”

    Bloomberg News reported late Thursday that Microsoft and Activision are considering giving up some control of their cloud-gaming business in the U.K. to win approval of British regulators, who — if the U.S. appeals court does not act — are the final hurdle to the deal closing on time.

    FTC Chair Lina Khan testified on Capitol Hill on Thursday, where Republican lawmakers assailed her actions and sharply criticized her agency’s court losses in trying to block the Microsoft-Activision deal and Meta’s
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    acquisition of a virtual-reality gaming company earlier this year.

    Read more: After Microsoft defeat, ‘toothless’ FTC needs to pick better battles if it wants to rein in Big Tech

    Also: FTC’s probe of OpenAI marks key moment in Khan’s push to rein in Big Tech

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  • FTC will appeal judge’s ruling clearing Microsoft-Activision deal

    FTC will appeal judge’s ruling clearing Microsoft-Activision deal

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    The Federal Trade Commission late Wednesday filed notice that it will appeal a judge’s ruling this week that gave Microsoft Corp. the green light to proceed with its $69 billion acquisition of Activision Blizzard Inc.

    In a filing with the Ninth Circuit Court of Appeals in San Francisco, the FTC is seeking to overturn U.S. District Judge Jacqueline Scott Corley’s ruling Tuesday, which said the deal would not hurt competition.

    “The District Court’s ruling makes crystal clear that this acquisition is good for both competition and consumers,” Brad Smith, Microsoft’s vice chair and president, said in a statement.” We’re disappointed that the FTC is continuing to pursue what has become a demonstrably weak case, and we will oppose further efforts to delay the ability to move forward.” 

    The FTC has claimed the tie-up of a major videogame platform — Microsoft’s
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    Xbox — with a major videogame publisher — Activision
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    -1.09%
    makes the wildly popular “Call of Duty,” among other titles — would be harmful to the videogame industry and consumers.

    “The facts haven’t changed,” an Activision spokesperson said Wednesday. “We’re confident the U.S. will remain among the 39 countries where the merger can close. We look forward to reinforcing the strength of our case in court, again.”

    Microsoft has pledged to keep “Call of Duty” available to Sony’s
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    PlayStation console for 10 years, and will make it available for Nintendo’s
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    Switch and some cloud-gaming platforms.

    The deal faces a July 18 deadline, and still must gain regulatory approval in the U.K.

    Tuesday’s ruling was yet another antitrust setback for the FTC, which has failed to do much to rein in Big Tech, and one analyst told MarketWatch on Tuesday that the regulators need to do ” a much better job of picking their battles,”

    Read more: After Microsoft defeat, ‘toothless’ FTC needs to pick better battles if it wants to rein in Big Tech

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  • After Microsoft defeat, ‘toothless’ FTC needs to pick better battles if it wants to rein in Big Tech

    After Microsoft defeat, ‘toothless’ FTC needs to pick better battles if it wants to rein in Big Tech

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    The U.S. Federal Trade Commission’s defeat as it sought to block Microsoft Corp.’s acquisition of videogame maker Activision Blizzard is yet another setback for an increasingly toothless regulator that needs to pick better battles with Big Tech.

    On Tuesday morning, a federal judge denied the FTC’s injunction that was seeking to block the software giant’s proposed $69 billion acquisition of Activision
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    best known for its hit videogame “Call of Duty.” The FTC argued that Microsoft
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    could withhold “Call of Duty” and other Activision games from rival console platforms such as Sony’s PlayStation, and keep the games on its Xbox only.

    Microsoft, in a show of faith, committed in writing to keep “Call of Duty” on PlayStation on parity with Xbox for 10 years, agreed with Nintendo
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    to bring “Call of Duty” to Switch and entered into several pacts to bring Activision content to several cloud gaming services, U.S. District Court Judge Jacqueline Scott Corley noted in her decision.

    “With these 10-year contracts that Microsoft made across the board with so many vendors, Nvidia
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    Nintendo and others, 10 years is a really long time, in my opinion,” said Sarah Hindlian-Bowler, an analyst at Macquarie Equity Research, in an interview Tuesday. “It is long enough to cover the arrival and maturity of the cloud gaming market….She understands  that 10 years is a very long long time to make a guarantee of this kind.”

    Also read: Regulators face an antitrust dilemma after Meta launches Threads

    Hindlian-Bowler said that she had been in the minority of Wall Street analysts in not believing the U.S. government would be able to block this deal.

    “The assumption that this somehow decreases the market is going to prove to be wildly incorrect,” she said, adding that she does not believe that the U.K.’s  Competition and Markets Authority will be able to block the deal either.

    The latest upset at the FTC was also not too surprising to other Capitol Hill watchers, especially in the light of other high-profile setbacks by the agency and its once-heralded commissioner, Lina Khan. When she was sworn in as chair of the FTC in mid-2021, Khan was hailed as the sheriff who would rein in Big Tech.

    “It’s hard to say I am surprised by the ruling because Khan has had a fairly unsuccessful track record,” said Owen Tedford, a senior research analyst at Beacon Policy Advisors. “The regulators are pushing the boundaries, deals that previously would have gone unchallenged have now gone challenged. And they are breaking precedent because Khan and company have expressed a dislike of settlements.”

    The FTC’s attempts to sue Meta Platforms Inc.
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    have had some defeats so far. In February, a California judge denied the FTC’s attempts to block Meta from buying a virtual-reality startup called Within Unlimited. The FTC’s suit to reverse Meta’s acquisitions of WhatsApp and Instagram, filed in 2021, is still plodding along.

    Additionally, the FTC recently filed a suit against Amazon.com Inc.
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    alleging that it is too difficult for consumers to cancel their Prime accounts, and the agency is reportedly also mulling another far-reaching suit against Amazon alleging that the e-commerce giant punishes merchants who do not use its logistics services. One analyst has already made a case that the FTC will lose that fight too.

    “I think that the FTC is in need of some change, in need of some refreshing and in need of doing a much better job of picking their battles,” said Hindlian-Bowler. “This does feel toothless, a lot of the fights they are picking are toothless. And unfortunately, they are missing the real battle. They are missing TikTok, they are missing the real fights where we actually have national security at risk.”

    In February, one of the Republican commissioners on the FTC resigned, and wrote an op-ed in the Wall Street Journal accusing Khan of disregarding the rule of law and due process.

    Compared to the European Union, which has had far more success implementing regulation to rein in Big Tech, the U.S. is still much weaker. “The EU seems to be having somewhat more success, levying big fines, getting these companies to change,” said Beacon’s Tedford. “The EU has passed these bills, but the U.S., despite these efforts, has not gotten there and is not going to get there for the next two years.”

    Money spent by Big Tech to lobby Congress in a huge part of the problem, whereas in Europe, “those lawmakers feel less beholden,” he added.

    More than a century ago, President Teddy Roosevelt, known for his “speak softly and carry a big stick” foreign policy, also used his bully pulpit to bust industrial monopolies.

    If Khan and her staff want to follow his lead and rein in Big Tech, they need to start picking their future battles more carefully — and carry bigger sticks.

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  • FTC Loses First Bid to Block Microsoft’s Acquisition of Activision Blizzard

    FTC Loses First Bid to Block Microsoft’s Acquisition of Activision Blizzard

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    FTC Loses First Bid to Block Microsoft’s Acquisition of Activision Blizzard. The Focus Turns to U.K. Regulators.

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  • Cava Group’s stock soars 11% as analysts start coverage on a bullish note

    Cava Group’s stock soars 11% as analysts start coverage on a bullish note

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    The stock of Mediterranean-style fast-casual restaurant chain Cava Group Inc. soared 11% Monday, after analysts initiated coverage on the stock which made its debut on public markets in mid-June with a flurry of buy ratings.

    At least four of the banks that were underwriters on the initial public offering — JP Morgan, Stifel, William Blair and Jefferies — assigned the stock a buy rating or the equivalent.

    FactSet shows one bank has a hold rating but it’s a restricted listing so it’s not clear who it’s from.

    The company
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    raised $317 million in its initial public offering, which priced above its proposed range at $22 a share and immediately rallied on opening. The company issued 14.4 million shares at a valuation of $2.45 billion. The stock was last trading at $43.83.

    See also: Like choosy shoppers at a retail store, IPO investors are demanding discounts and displaying price sensitivity

    The company is not profitable and has high cash burn and just $23 million in cash and cash equivalents on its balance sheet, according to its IPO filing documents.

    But analysts were unfazed, with William Blair analysts calling it a clear leader in a fast-growing category with proven geographic appeal.

    “CAVA has hit upon a winning formula with its customizable menu of bowls and pitas featuring bold Mediterranean flavors that can fit in any dietary preference,” wrote analysts led by Sharon Zackfia.

    “CAVA’s customer appeal is evident in average unit volumes (AUVs) of roughly $2.5 million and a 44% five-year revenue CAGR through 2022.”

    The company accelerated its growth with the 2018 acquisition of Zoës Kitchen, “which provided immediate access to attractive real estate in new markets while enabling capital-efficient densification in top-tier trade areas (Zoës conversions roughly half the cost of a typical greenfield CAVA),” they wrote.

    That has set the company up to end 2023 with roughly triple the number of locations as it had in 2020.

    William Blair estimates that there’s room for at least 1,200 domestic Cava restaurants based on the population per restaurant already achieved in Virginia, where it’s still adding locations.

    That supports management’s target of 1,000-plus locations by 2032.

    “We also see the potential for digital drive-thrus to further lengthen CAVA’s growth runway while lifting AUVs (and potentially returns), with about one-third of this year’s new units having drive-thrus, ramping up to about half in 2024 (versus roughly 20 drive-thrus today),” they wrote. William Blair initiated coverage with an outperform rating.

    JP Morgan launched coverage with an overweight rating and a December 2024 $45 stock price target. Analysts cheered the entrepreneurial sprit of Founder and CEO Brett Schulman with help from Chairman Ron Shaich, the founder of Panera Bread.

    “In-store design/operational procedures and back-end support for the network allows CAVA to be efficient, safe and consistent as the brand leverages these systems for its goal national brand penetration,” they wrote in a note to clients.

    Mediterranean cuisine covers many types of food and occasions, so the end-market is large, topping out at more than $1 trillion in U.S. sales.

    While bowl builds priced at $10.95 to $16.95 will likely limit a high frequency of lower-income consumers, “we believe the brand has an enduring appeal to a very broad customer base for at least occasional usage.”

    And suburbs are 82% of the site mix and are expected to remain a key location base, they added.

    Stifel and Jefferies analysts initiated coverage with a buy rating and $48 price target. Stifel analysts led by Chris O’Cull also cheered the wide appeal of the food and compelling unit-level returns and highlighted the company’s healthy balance sheet.

    “The company is in strong financial condition with no funded debt and roughly $340M in cash on hand following the company’s IPO,” they wrote in a note to clients. “We project the company’s average quarterly cash balance will remain above $200M with no funded debt for the foreseeable future. We project positive annual free cash flow starting in 2026.”

    Still, not everyone is convinced the company is a buy. David Trainer, chief executive of New Constructs, an independent equity research firm that uses machine learning and natural-language processing to parse corporate filings and model economic earnings, published a series of critical reports before the IPO.

    Trainer questioned Cava’s ability to reach profitability and its high valuation. He even compared it to WeWork 
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     the infamous startup created by Israeli entrepreneur Adam Neumann, that at its peak was valued at $47 billion, but is now trading at just 26 cents a share, or a market cap of $521 million.

    The Renaissance IPO ETF 
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     has gained 32% in the year to date, while the S&P 500 
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    has gained 15%.

    For more, see: Fast-casual restaurant chain Cava Group’s IPO documents raise some red flags: analyst

    Read now: Cava Group CFO is confident restaurant chain will be profitable—but she won’t say when

    Related: 5 things to know about the fast-casual Mediterranean restaurant chain Cava

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  • Like choosy shoppers at a retail store, IPO investors are demanding discounts and displaying price sensitivity

    Like choosy shoppers at a retail store, IPO investors are demanding discounts and displaying price sensitivity

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    IPO investors, much like retail shoppers in recent years’ inflationary environment, are demanding clear discounts and demonstrating sensitivity to price and valuations, according to Renaissance Capital.

    The provider of IPO exchange-traded funds and institutional research said that’s a positive — even if tech unicorns in the pipeline would prefer it were not the case.

    “Quality consumer names are working,” said Matthew Kennedy, senior strategist at Renaissance, listing Kenvue, Cava Group Inc., Gen Restaurant Group Inc. and Savers Value Village Inc. as examples of recent new issues that enjoyed strong debuts.

    Kenvue
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    +1.65%    ,
    the former consumer arm of Johnson & Johnson
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    +0.87%
    and parent of household-name products such as Tylenol and Band-Aid, raised $3.8 billion in its May IPO at a valuation of $41.08 billion, making it the biggest deal of the year to date.

    Cava Group
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    -5.93%    ,
    the loss-making Mediterranean-style fast-casual restaurant group, raised $317 million in its mid-June deal at a valuation of $2.5 billion. The stock popped more than 99% on its first day of trade.

    For more: Cava Group CFO is confident restaurant chain will be profitable — but she won’t say when

    Gen Restaurant Group
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    +13.95%
    is a profitable Korean barbecue chain that made its debut Wednesday with a more than 50% pop in early trade.

    “But broadly investors are still demanding clear discounts to public peers, especially if they take issue with certain aspects of a deal. So it’s good to see that valuation sensitivity,” said Kennedy.

    Savers Value Village
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    +3.45%
    went public Thursday with some fanfare, closing 27% above its $18 issue price. The company is the biggest for-profit thrift-store chain in North America, with 317 stores that operate under multiple names.

    The company is profitable, with net income of $11.9 million in the quarter through April 2, after a loss of $10.2 million in the same period a year earlier. For all of 2022, it had net income of $84.7 million, up from $83.4 million in 2021.

    Revenue for the quarter came to $327.5 million, down from $345.7 million in the year-ago period. Revenue totaled $1.4 billion for 2022, up from $1.2 billion in 2021.

    See: Money-losing food chain Cava showed IPO success. Is it finally time for some tech deals?

    Two other deals that made their debut on Thursday fared less well, however.

    Texas-based Kodiak Gas Services Inc. 
    KGS,
    +3.44%
     and Fidelis Insurance Holdings Ltd. closed lower after pricing below their estimated ranges and making other accommodations to get their deals through.

    Bermuda-based Fidelis, a reinsurer, downsized its deal to 15 million shares from a previous expectation that it would offer 17 million. The initial public offering was priced at $14 a share, below the proposed $16-to-$19 range.

    Maker of oil- and gas-production equipment Kodiak opened almost 3% below its issue price of $16, which was well below its proposed price range of $19 to $22.

    Fidelis has an unusual structure, in that it uses a third party for origination, underwriting and claims management, said Kennedy.

    “We think insurance investors wanted a discount for a company that didn’t own the underwriting group,” he said. “It has an experienced management team, though, so now they’ll just need to execute.”

    Kodiak, meanwhile, carries substantial debt and will need to undertake significant capital spendig in the coming years, just as gas prices have fallen back.

    It’s also worth noting that the last big oil and gas IPO, Atlas, “is slightly below its offer price,” Kennedy said.

    Atlas Energy Solutions Inc.
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    -2.75%
    went public in March at an issue price of $18 a share. The stock was last quoted at $17.52.

    Still, Renaissance is expecting a gradual reopening of the IPO market in the second half, said Kennedy, who noted that the IPO ETF
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    +1.38%
    has gained about 30% in to date in 2023, outperforming the S&P 500’s
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    14% gain.

    To date, there have been 52 IPOs this year, up 33% from the same time last year, when the market was effectively frozen. Almost $9 billion in proceeds have been raised, up 115% from last year but well below levels seen in frothier times.

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  • Activision’s Microsoft Saga Is Almost Over. It May Be Time to Sell the Stock.

    Activision’s Microsoft Saga Is Almost Over. It May Be Time to Sell the Stock.

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    The fate of


    Microsoft


    $69 billion purchase of


    Activision


    Blizzard will finally be known in the coming weeks—and investors may want to consider taking profits on the videogame maker’s stock before then.

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  • Nike profit misses expectations, as ‘higher markdowns’ endure amid weaker demand

    Nike profit misses expectations, as ‘higher markdowns’ endure amid weaker demand

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    Nike Inc. on Thursday reported fourth-quarter profit that came up short of Wall Street’s expectations, with price cuts weighing on results amid weaker demand for sneakers and clothing.

    Nike
    NKE,
    +0.30%
    reported fourth-quarter net income of $1.03 billion, or 66 cents a share, down from $1.44 billion, or 90 cents a share, in the same quarter last year. Revenue rose 5% to $12.83 billion, compared with $12.23 billion in the prior-year quarter.

    Analysts polled by FactSet expected Nike to report adjusted earnings of 68 cents a share, on $12.58 billion in sales.

    Nike said gross margins slipped 140 basis points to 43.6%, dragged by “higher product input costs and elevated freight and logistics costs, higher markdowns and continued unfavorable changes in net foreign currency exchange rates.”

    Shares were up 0.3% after hours on Thursday.

    Heading into the earnings, Wall Street had questions about Nike’s stockpiles of unsold shoes and clothing, and what it might take to clear them, as consumers still find themselves stretching their budgets to buy more essential goods like groceries.

    Nike’s broader plans to sell more shoes and clothes directly — either through its own e-commerce platform or its own physical stores. But recent plans to start selling again in Macy’s Inc.
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    +3.35%
    and Designer Brands Inc.’s
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    +4.01%
    DSW shoe stores have raised questions over whether the athletic-gear maker is rethinking that strategy. Analysts were also focused on demand in China, whose re-opening from COVID-19 shutdowns remains in flux.

    Shares of Nike have risen 9.6% over the past 12 months. By comparison, the S&P 500 Index
    SPX,
    +0.45%
    has risen 15% over that period.

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  • Does Nike have too many sneakers? Its financial results could tell us whether shoes will get cheaper.

    Does Nike have too many sneakers? Its financial results could tell us whether shoes will get cheaper.

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    Are stores getting more desperate to sell sneakers? Fourth-quarter results from Nike Inc. on Thursday will probably provide part of the answer.

    Even as its some of its basketball shoes still put up double-digit sales gains — like those named after NBA icons LeBron James, Luka Doncic and Giannis Antetokounmpo — the athletic-gear maker, like its rivals, has faced weaker consumer demand overall. With customers forced to spend more money on necessities over the past year, they’ve had less to spend on new shoes.

    In March, Nike
    NKE,
    +0.19%
    executives said that the demand backdrop remained “promotional” — one in which anyone selling sneakers and clothing was cutting prices more aggressively to attract customers. But ahead of Thursday’s results, some analysts also wondered whether the stalling demand has forced bigger changes to the way management thinks about its broader turn away from retailers — a core piece of its sales strategy.

    Nike over recent years has embarked on a plan to rely less on shoe retailers for sales and more on sales made directly to customers through its own stores and online. But recently, it decided to start selling clothing again at Macy’s
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    +3.58%
    and shoes again at DSW, the shoe-store chain run by Designer Brands Inc.
    DBI,
    +4.32%
    — this after ending partnerships with both retailers over the past two years.

    The return to traditional retail has raised questions about whether Nike is looking to more aggressively clear product it’s had trouble selling, and whether management is re-evaluating the company’s go-it-alone sales strategy overall.

    “The big question on our minds heading into [Nike’s] quarter is what is going on with the [direct-to-consumer] pivot?” Quo Vadis analyst John Zolidis said in a note on Monday. “Reopening Macy’s and DSW seems odd in context of previous dismissive statements about undifferentiated retail.”

    He continued: “Further, neither of these retailers has a customer that correlates strongly with [Nike’s] highest-value segments. The easiest explanation is that [Nike] overestimated the dollars it could recapture from closed wholesale accounts and now has too much inventory it needs to clear.”

    What to expect

    Earnings: Analysts polled by FactSet expect Nike to earn 68 cents a share, down from 90 cents in the same quarter a year ago. Contributors to Estimize — a crowdsourcing platform that gathers estimates from Wall Street analysts as well as buy-side analysts, fund managers, company executives, academics and others — expect earnings per share of 75 cents.

    Revenue: Analysts polled by FactSet expect $12.58 billion in sales for Nike. Forecasts from Estimize call for sales of $12.72 billion.

    Stock price: Nike’s stock is only up 1.3% over the past 12 months. Shares got hit in September, after company executives warned of further price-cutting from rivals due to weaker demand. The stock rebounded later but gave up some gains in May. The stock was up 2% on Monday.

    What analysts are saying

    Nike in March said demand for product sold at full pricing remained solid. Still, sneaker chain Foot Locker Inc.
    FL,
    +2.09%
    recently cut its outlook. Lots of Vans shoes are running at a discount, one analyst said last month, as the skater-centric brand competes with casual fare from the likes of Adidas
    ADS,
    +0.61%
    and others.

    Other analysts were also wondering about Nike’s return to Macy’s and DSW. But not everyone believed the move was a sign of deeper problems.

    “Investors are worried that this is a reversal in Nike’s shift from wholesale to [direct-to-consumer], but we don’t think the strategy is broken,” BofA analyst Lorraine Hutchinson said in a research note on Wednesday. “We expect to hear an explanation of these moves on the [conference] call rather than an about-face on its focus on reducing undifferentiated wholesale.”

    Still, the company faced concerns about sales abroad. Zolidis also said markets were increasingly worried about growth in China, whose recovery from pandemic lockdowns has stumbled.

    “Our recent conversations with companies in China suggest that trends are mixed,” Zolidis said. “The consumer is more value oriented, and job uncertainty is higher.”

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  • AMC shares make biggest gain in nearly three months ahead of stock conversion hearing

    AMC shares make biggest gain in nearly three months ahead of stock conversion hearing

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    AMC Entertainment Holdings Inc.’s stock ended Wednesday’s session up 7.6% on the eve of a key hearing in the company’s push to convert its AMC Preferred Equity Units into common stock.

    Shares of AMC
    AMC,
    +7.56%
    had their largest single-day percentage gain since April 6, when they rose 21%. Earlier this week, the stock snapped its longest losing streak in 18 months. The APE
    APE,
    -3.37%
    units ended Wednesday’s session down 3.4%.

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  • Why top pick Victor Wembanyama could be worth over $80 million a year to the Spurs

    Why top pick Victor Wembanyama could be worth over $80 million a year to the Spurs

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    That’s how Victor Wembanyama introduced himself the day before the NBA draft, when he conducted his first news conference before NBA media. But to talent evaluators, Wembanyama has already emerged as one of the top NBA prospects of a generation with his dominant play for a French professional team this season, and his tantalizing upside on the basketball court.

    The 19-year-old, 7-foot-5 Frenchmen — who goes by “Wemby” — was selected with the first pick in the NBA Draft on Thursday night by the San Antonio Spurs, and the team could be set for a huge financial windfall from Wembanyama’s arrival.

    The Spurs could see an increase of roughly $8 million-$10 million in season ticket sales, an added $5 million-$10 million in incremental ticket revenue from higher and dynamic pricing, and another $5 million-$10 million in corporate sponsorships, according to Dr. Patrick Rishe, the director of the sports business program at Washington University in St. Louis.

    “All told, the impact on team revenues in 2023-24 will likely be somewhere in the $20-$50 million range,” Rishe said, while adding that the Spurs may also be able to leverage Wembanyama’s arrival when negotiating its next local TV contract.

    See also: Victor Wembanyama: 5 things to know about the generational NBA prospect

    Another economics expert thinks Wembanyama’s financial impact on the Spurs could be even higher.

    “$80 million a year to the Spurs for the next few years, that was roughly equal to the increase in revenues that we saw when LeBron James moved back from Miami to Cleveland,” Victor Matheson, economics professor at the College of the Holy Cross, told MarketWatch.

    NBA first-round draft picks like Wembanyama sign a four-year contract upon entering the league. After that, the team that drafted the player has a significant edge in retaining him on his next contract because they are allowed to give him larger pay raises than any other club. Because of this, young players who turn into superstars rarely leave the teams that drafted them for the first seven years of their career, meaning Wembanyama could pay dividends to the Spurs in the hundreds of millions of dollars if he stays with the team.

    See also: LeBron James vs. Michael Jordan: Who is the GOAT when it comes to net worth?

    While the Spurs are not for sale, some think Wembanyama’s presence alone will increase that value of the team, which was roughly $2 billion as of 2022 (or 20th in the NBA).

    “I suspect that just the cachet of having this player on your team would be the sort of thing that would entice an owner potentially to pay more for the team, because owners in sports aren’t just about dollars and cents, they’re about dollars and cents, and the prestige and the ego that go along with owning an NBA franchise,” said Matheson.

    The NBA has complex revenue sharing agreements among teams to help level the financial playing field between the small-market and big-market teams. Because of this agreement, not every dollar Wembanyama makes for the Spurs goes directly to the team.

    So it’s clear that Wembanyama could provide a major financial boost for the Spurs. But his immediate impact on the NBA overall might seem small, considering the league made over $10 billion last year, according to Statista. But another area where Wembanyama could help the NBA in a huge way is by unlocking a new audience for NBA games: France.

    “A guy like him can certainly open up new markets for you. So obviously, we have had top players from France before like Tony Parker, but this might be maybe a level beyond that,” Matheson said. “And if you could open up a 60 million person country, and all of a sudden make the NBA must-see TV in Paris and not just in the United States, that’s where you can really generate a lot.”

    Matheson compared Wembanyama’s arrival to that of China’s Yao Ming coming into the NBA, and Japan’s baseball star Ichiro Suzuki’s arrival in the MLB, which both opened up massive international markets that those leagues didn’t already have a big presence in.

    ESPN’s Adrian Wojnarowski reported that drafting Wembanyama could add as much as $500 million to the value of an NBA franchise.

    But some sports industry experts see Wembanyama’s impact as more muted, noting the possibility that he maybe doesn’t live up to the incredible hype, as well as the limitations of San Antonio’s smaller market size compared to cities like New York.

    “This could be a significant turning point for the fortunes of the Spurs, both on and off the court, but it is worth remembering that players are different ‘assets’ than, say, arenas,” Michael Leeds, professor of economics and director of graduate studies at Temple University, told MarketWatch. “There is a lot of uncertainty among even top picks.” 

    He recalled how Sam Bowie was chosen ahead of Michael Jordan during the 1984 draft, yet Jordan became a superstar, while Bowie did not have much of a basketball career. “A player’s career can be derailed for a lot of reasons,” Leeds added. “I do not think that Wembanyama will have that much of an immediate impact on the financial fortunes of the Spurs.”

    See also: Here’s how much Victor Wembanyama and other 2023 NBA draft picks will earn on their rookie contracts

    The Spurs are also hurt by their market size in San Antonio, which some say limits their financial upside compared to a bigger market like New York or Los Angeles. San Antonio is the 24th biggest TV market (out of 30) among NBA teams, according to Sports Media Watch.

    “The San Antonio market is small and has demographics that generally don’t support the NBA,” Emory University marketing professor Michael Lewis told MarketWatch. “There are markets that could benefit greatly from a generational talent, but the Spurs seem unlikely.”

    “It helps the franchise but over the long run players move from place to place,” added Sal Galatioto, the president of Galatioto Sports Partners, who has facilitated over 30 sales of professional sports teams — including the sale of the Golden State Warriors in 2010. “Players get hurt. Players aren’t as good as you think they are.”

    Galatioto cited the recent sale of the NBA’s Charlotte Hornets at a $3 billion valuation as evidence that franchise appraisals are getting higher, and not much of that increase is based on what happens on the court.

    “When was the last time Charlotte won anything?” he asked.

    Read on: NBA All-Star Chris Paul on what he looks for in an investment, competing with LeBron James, and his favorite possession

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  • Logitech’s stock hit by reports its $30 game controller was used to steer missing sub near Titanic

    Logitech’s stock hit by reports its $30 game controller was used to steer missing sub near Titanic

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    U.S.-listed shares of Logitech International SA, a Swiss maker of computer peripherals and software, were down about 3.6% Monday, amid reports that one of the company’s gamepads was being used to steer the submersible that went missing while taking five people down to the wreck of the Titanic.

    Logitech’s $30 F710 gamepad was the controller of the OceanGate submarine vessel that is the subject of a massive sea-and-air search, according to a segment on the “CBS News Sunday Morning Show” by reporter David Pogue that aired last November.

    In the segment, OceanGate Chief Executive Stockton Rush, one of the five people currently onboard the submersible, showed Pogue the game controller that he said “runs the whole thing,” causing the reporter to burst out laughing.

    Pogue later describes the “MacGyver jerry-riggedness” of the whole thing, which included off-the-shelf components such as lights from Camper World and construction pipes as ballast. Rush explained that other parts of the vessel were made in cooperation with Boeing, NASA and the University of Washington.

    As The Verge pointed out, game controllers are used in other instances to control submarine periscopes, including by the U.S. Navy and Elon Musk’s The Boring Company.

    On Monday, Pogue tweeted that during his report which was filmed last summer, the submersible got lost for a period — while he was on the surface.

    In that instance, the vessel still had contact with the surface. This time, there are no communications, although a Canadian military surveillance aircraft detected underwater noises early Wednesday, as the Associated Press reported.

    A statement from the U.S. Coast Guard did not elaborate on what rescuers believed the noises could be, though it offered a glimmer of hope for those lost aboard the Titan. Estimates suggested as little as a day’s worth of oxygen could be left if the vessel is still functioning.

    Also on the vessel with Rush are a British adventurer, two members of a Pakistani business family and a Titanic expert.

    Authorities reported the carbon-fiber vessel overdue Sunday night, setting off the search in waters about 435 miles (700 kilometers) off the coast of of St. John’s.

    The submersible had a four-day oxygen supply when it was put to sea around 6 a.m. Sunday, according to David Concannon, an adviser to OceanGate Expeditions, which oversaw the mission.

    Questions remain about how teams could reach the lost submersible, which could be as deep as about 12,500 feet (3,800 meters) below the surface near the watery tomb of the historic ocean liner. Newly uncovered allegations also suggested there had been significant warnings made about the vessel’s safety prior to its disappearance.

    Read: Missing Titanic submersible: Here’s what we know so far

    Logitech’s stock
    LOGI,
    -2.69%
    is down about 18% in the month to date.

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  • Wyndham Clark wins U.S. Open for his first major title, edging out Rory McIlroy 

    Wyndham Clark wins U.S. Open for his first major title, edging out Rory McIlroy 

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    LOS ANGELES — Wyndham Clark always carried the message from his late mother to “play big.” Nothing was bigger than Sunday when he held off Rory McIlroy with one clutch shot after another to become a U.S. Open champion.

    The final act was two putts from 60 feet on the 18th hole at Los Angeles Country Club, and the 29-year-old Clark pumped his fist when it settled a foot away. He tapped that in for an even-par 70 and a one-shot victory over McIlroy and so many other stars.

    Scottie Scheffler, the No. 1 player in the world, couldn’t catch him. Neither could British Open champion Cameron Smith or Rickie Fowler, who played in the final group for the third time in a major and watched an exquisite performance by Clark, playing for only the third time on the weekend in a major.

    Clark let loose his emotions at the end, looking to the blue sky in tears and covering his face with his cap as he sobbed on the green. He thought about quitting golf a decade ago when he struggled with the loss of his mother, Lise, to breast cancer. She was who kept him steady in good times and bad.

    This was as good as it gets for Clark, who broke through for his first PGA Tour victory only six weeks ago against an elite field at Quail Hollow.

    “I just felt like my mom was watching over me today,” Clark said after hoisting the silver U.S. Open trophy. “I worked so hard and dreamed about this moment for so long. I just felt like it was my time.”

    For McIlroy, it was more disappointment in his quest to end nine years without a major.

    He opened with a birdie and didn’t make another the rest of the way. McIlroy played a final round that typically wins a U.S. Open — 16 pars, one bogey. Just not this one. Even as Clark showed signs of cracking during the rugged closing stretch, McIlroy missed fairways and didn’t give himself any reasonable birdie chances.

    It was similar to St. Andrews last summer at the British Open, when he hit every green and couldn’t buy a putt. Instead, he’ll face more questions about when he’ll win another major.

    “When I do finally win this next major, it’s going to be really, really sweet,” McIlroy said. “I would go through 100 Sundays like this to get my hands on another major championship.”

    Scheffler missed too many putts early on the back nine and needed help from Clark and McIlroy that never arrived. He also closed with a 70 to finish third, a month after a runner-up finish in the PGA Championship.

    Fowler set a U.S. Open record with 23 birdies, but just like so many other majors when he had a chance, he was in reverse before he ever got going — three bogeys in the opening seven holes. He never made up the ground and shot 75.

    This day belonged to Clark, who showed remarkable poise and self-belief, not to mention an extraordinary short game and a fairway metal he won’t soon forget.

    Already with a two-shot lead, he was a yard away from an easy birdie on the par-5 eighth when his approach hit a steep bank of the barranca to the left. Barely able to see his golf ball, Clark took a whack and the ball advanced a few inches deeper into thick grass.

    He hammered it again, this time over the green, 70 feet away down a firm and scary putting surface. He chipped that to 3 feet to escape with bogey.

    “That up-and-down was the key to the tournament,” he said.

    More such shots followed. On the par-3 ninth, he was on the bank of a bunker and chipped away from the flag, using the slope expertly to get it to within 7 feet for another big save. And then he clipped a pitch from a tight lie left of the 11th green to 4 feet for par.

    The signature shot was his fairway metal from 282 yards on the par-5 14th to 20 feet that set up a two-putt birdie, giving Clark a three-shot lead with four to play.

    But he made the only bogey of the day on the par-3 15th, then found a bunker left of the 16th fairway and whacked his hand on his putter when he missed a 7-foot par putt. His lead down to one shot, he got up-and-down from left of the 17th green to keep the lead.

    The USGA allowed thousands of fans to circle the fairway short of the 18th green with so few grandstands, creating a big theater for Clark’s finish.

    Fowler, still chasing his first major, returned to the 18th green to hug Clark.

    “I went back in there and just said, ‘Your mom was with you. She’d be very proud,’” Fowler said.

    Clark finished at 10-under 270 and along with $3.6 million — his second such cash prize in the last six weeks — he moves to No. 2 in the Ryder Cup standings.

    Smith shot 67 to finish fourth. Tommy Fleetwood became the first player with two rounds of 63 in the U.S. Open and finished in a tie for fifth with Fowler and Min Woo Lee (67). Fleetwood also shot 63 at Shinnecock Hills in the final round of 2018.

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  • Cava Group CFO is confident restaurant chain will be profitable — but she won’t say when

    Cava Group CFO is confident restaurant chain will be profitable — but she won’t say when

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    Cava Group, the Mediterranean-focused fast-casual restaurant chain that’s making its trading debut on Thursday, is confident it has access to enough funding to expand its business and make a profit, according to Chief Financial Officer Tricia Tolivar.

    But Tolivar declined to provide a timeline to profitability in an interview with MarketWatch.

    The…

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  • Mediterranean fast-casual restaurant chain Cava prices IPO at $22 a share

    Mediterranean fast-casual restaurant chain Cava prices IPO at $22 a share

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    Mediterranean fast-casual restaurant chain Cava Group on Wednesday priced its initial public offering of 14.4 million shares at $22 a share, up from a prior range, giving the company a valuation of roughly $2.45 billion.

    Shares are expected to begin trading Thursday on the New York Stock Exchange with the ticker symbol CAVA.

    The rapidly-growing…

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  • Judge temporarily blocks Microsoft’s $69 billion purchase of Activision

    Judge temporarily blocks Microsoft’s $69 billion purchase of Activision

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    A federal judge late Tuesday approved a request by the Federal Trade Commission to temporarily block Microsoft Corp.’s $69 billion acquisition of Activision Blizzard Inc.

    U.S. District Judge Edward Davila in San Francisco issued a temporary restraining order in order to “maintain the status quo,” and set a evidentiary hearing to be held June 22-23 on whether a preliminary injunction should be issued.

    The deal was set to be finalized as soon as this Friday. Tuesday’s order said the deal may not close until at least five days after the court’s preliminary injunction ruling.

    The acquisition has raised antitrust concerns that Microsoft
    MSFT,
    +0.74%    ,
    with its Xbox gaming console, could withhold hit Activision Blizzard
    ATVI,
    +1.17%
    videogame franchises such as “Call of Duty” and “Overwatch” from competing console platforms.

    On Monday, the FTC filed for a restraining order and injunction to block the deal, arguing “a preliminary injunction is necessary to maintain the status quo and prevent interim harm to competition.”

    “This loss of competition would likely result in significant harm to consumers in multiple markets at a pivotal time for the industry,” the FTC said in its filing Monday.

    In a statement Tuesday evening, a Microsoft spokesperson said: “Accelerating the legal process in the U.S will ultimately bring more choice and competition to the gaming market. A temporary restraining order makes sense until we can receive a decision from the court, which is moving swiftly.” 

    While EU regulators approved the deal in May, British regulators have tentatively scheduled appeal hearings after saying in April they would prohibit the purchase.

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  • Manchester United shares leap on report Qatari suitor to be named preferred bidder

    Manchester United shares leap on report Qatari suitor to be named preferred bidder

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    Manchester United shares
    MANU,
    +3.98%
    jumped 17% in premarket trade following a report from Qatar’s Al-Watan that Qatar’s Sheikh Jassim bin Hamad al-Thani will soon be announced as the preferred bidder. He has been battling Jim Ratcliffe for control of the club after the controlling Glazer family said they would consider selling.

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  • An unscripted Tony Awards honors ‘Kimberly Akimbo’ and ‘Leopoldstadt,’ among other shows

    An unscripted Tony Awards honors ‘Kimberly Akimbo’ and ‘Leopoldstadt,’ among other shows

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    Call it an equal opportunity Tony Awards.

    No single show dominated Broadway’s big night, with prizes split almost evenly among a handful of productions. “Kimberly Akimbo,” a quirky, smaller-scaled show that chronicles the story of a teenager who suffers from a disease that effectively traps her in an older person’s body, was named best musical, the evening’s most heralded honor.

    But otherwise, the show captured a respectable but hardly record-breaking four other awards — namely, ones for Victoria Clark for lead actress in a musical, Bonnie Milligan for supporting actress, Jeanine Tesori for score and David Lindsay-Abaire for book. By contrast, “Hamilton” won a total of 11 awards when it competed in 2016.

    Similarly, “Leopoldstadt,” legendary dramatist’s Tom Stoppard’s chronicle of a Jewish Viennese family before, during and after the Holocaust, was honored for best play, but didn’t sweep its way through all the other categories in which it was nominated. Still, it picked up wins for Brandon Uranowitz for best supporting actor, Patrick Marber for direction and Brigitte Reiffenstuel for costume design.

    Other major winners: a production of Suzan-Lori Parks’ “Topdog/Underdog” was named best revival of a play and a production of Alfred Uhry and Jason Robert Brown’s “Parade” was recognized for best revival of a musical.

    This year’s Tony Awards ceremony, held at the United Palace theater in New York City, was significant on several other levels. For starters, it was an unscripted awards show — a situation borne from the fact that the Writers Guild of America is still on strike. The powers behind the Tony Awards worked out an agreement with the union to let the show proceed, but without the preamble and intros that usually accompany any awards program.

    Still, there was a host — veteran actress Ariana DeBose — who acknowledged some of the awkwardness of the situation from the start, but also showed that, well, the show must go on.

    “Darlings, buckle up!” DeBose said at the beginning of the main ceremony, which was seen on CBS and Paramount+.

    It was also an occasion for Broadway to flex some of its muscle as it continues its recovery from the pandemic, which forced theaters to shut down for more than year. Shows grossed nearly $1.6 billion during the 2022-’23 season — a sizable figure, but still not equal to the record $1.8 billion that Broadway took in during the 2018-’19 season.

    In addition, this marked the first time the Tonys recognized a non-binary performer with an award — actually, two performers, with J. Harrison Ghee of “Some Like It Hot” for best lead actor in a musical and Alex Newell of “Shucked” for best featured actor in a musical.

    Newell gave one of the most emotional acceptance speeches of the night.

    “Thank you for seeing me, Broadway,” Newell said. “I should not be up here as a queer, nonbinary, fat, Black little baby from Massachusetts. And to anyone that thinks that they can’t do it, I’m going to look you dead in your face. That you can do anything you put your mind to.”

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  • Cineworld’s Proposed Restructuring Now Backed by Most Lenders — Update

    Cineworld’s Proposed Restructuring Now Backed by Most Lenders — Update

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    By Joe Hoppe

    Cineworld Group said Thursday that its proposed restructuring has the backing of lenders controlling almost all of its legacy credit lines and most of the outstanding debt under its debtor-in-possession facility.
    

    

    The London-based cinema company–which owns Regal Cinemas–said more lenders under its term loans due in 2025 and 2026 and revolving credit line due this year, have agreed to amended and restated versions of the restructuring support agreement and the backstop commitment agreement, first filed in early April in the U.S. Bankruptcy Court.
    

    Now, the proposed restructuring has support of those holding and controlling 99% of the legacy credit lines and at least 69% of the outstanding indebtedness under the debtor-in-possession facility, the company said.
    

    The proposed restructuring is expected to reduce indebtedness by around $4.53 billion, raise $800 million and provide $1.46 billion in new debt financing, the company said on April 3. The proposed restructuring doesn’t provide for any recovery for holders of Cineworld’s existing equity interests.
    

    Cineworld now expects to emerge from Chapter 11 bankruptcy in July. During the restructuring, the company has continued to operate its business and cinemas as usual, it said.
    

    Cineworld entered into Chapter 11 in September, with around $1.94 billion of debt, and had been in talks with stakeholders since then to develop a reorganization plan to maximize value. The company’s shares fell in late February after it said it had received a number of proposals from potential parties to buy some or all of its business, but none involve an all-cash bid for the entire company, leaving shareholders empty handed
    

    During its bankruptcy process, AMC Entertainment held discussions regarding a potential strategic acquisition of theaters and talks about reviving a previously scrapped merger with Cineplex were also held
    

    In early April, Cineworld said it had entered a restructuring support agreement and a backstop commitment agreement with some lenders. At the same time, Cineworld said the marketing process in the U.S., the U.K. and Ireland will be terminated. Proposals for the rest of the world business–outside of the U.S., the U.K. and Ireland–continued to be considered, it said.
    

    Write to Joe Hoppe at joseph.hoppe@wsj.com
    

    

    

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