Friday, August 30, 2019

Walmart tests dentistry and mental care as it moves deeper into primary health

Walmart, the world’s biggest retailer, is moving deeper into the primary care and mental health market, opening a new clinic called Walmart Health in Georgia.

The company recently updated its website with a link to Walmart Health, describing its “newest location in Dallas, GA.” It also went online with the site 

“Walmarthealth.com,” where patients can set up appointments. Walmart is testing the concept with the initial clinic and could open more in the future, according to people familiar with the matter who asked not to be named because the plans are confidential.
The Dallas location, which is set to open its doors next month, will give patients access to comprehensive and low-cost primary care, including for mental health issues. The clinic is in a separate building next door to a Walmart store to give a sense of privacy for patients.

The website indicates that first appointments are available on Sept. 13, and the company will offer primary care, dental, counseling, labs, X-rays and audiology, among other services. Sean Slovenski, who Walmart recruited from Humana, is leading the clinic efforts, the people familiar said.

Walmart is already one of the largest pharmacy companies in the U.S., offering in-store sections for prescription drugs in almost all of its 4,700 locations across the U.S. The company said health and wellness, which includes pharmacy, clinical and optical services, accounted for about 9%, or $36 billion, of its roughly $332 billion in U.S. sales last fiscal year.

The company hasn’t previously offered mental health services, but it did lease space in one of its Texas stores to a third-party behavioral health company in 2018 because of a shortage of professionals in the region. That experience has helped inform the company’s view of how it can have a bigger impact in the space, the people said.

A Walmart spokesperson confirmed the opening of the clinic.

“Walmart is committed to making healthcare more affordable and accessible for customers in the communities we serve,” the representative said. “The new Walmart Health center in our Dallas, Georgia, store will provide low, transparent pricing for key health services for local customers. We look forward to sharing more details when the facility opens next month.”

Primary care is a newer market for Walmart and puts it in competition with a different set of companies, ranging from large health systems to emerging businesses like One Medical, Circle Medical and Forward. Walmart’s distinct opportunity is that roughly 140 million people visit its stores every week, and it has about 1.5 million U.S. employees spread across cities of all sizes, including in rural areas where there’s a shortage of health-care services.
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Hedge Funds Got Schooled by China Education Stocks

If you’re a U.S. hedge fund manager, China’s education stocks have been a tale of two cities. A look at 180 U.S.-listed Chinese companies – from Alibaba Group Holding Inc. to BAT Group Inc. – shows that hedge funds have been gravitating toward this sector. (4)Over the past six months, these companies were among the best and worst performers. 
While mutual and pension funds seek slow and steady returns, hedge funds often try to profit from big bets on sectors or companies in upheaval. Now that China’s internet sector has grown so large, and revenue has started to slow, these investors are looking farther afield for a home run. 
That makes China’s education sector a tempting target. A three-year boom peaked last year after Beijing issued a series of new regulations, including restricting kindergarten operators from raising funds in equity markets. As my colleague Nisha Gopalan wrote at the time, these rules sent mixed signals about the government’s changing attitude toward private capital in education. Just two years earlier, Beijing was encouraging non-state investment in the sector, which prompted a wave of listings, she noted.
Profitability in the education sector is also patchy: More than half of U.S.-listed Chinese education companies posted a loss in their most recent earnings. In terms of stock performance, ATA Inc., which offers online and on-campus education, gained 64% and New Oriental Education & Technology Group Inc., a provider of classes, test prep and camps, climbed 33%. By contrast, Tarena International Inc., which breached Nasdaqlisting rules, fell 83% and Ambow Education Holding Ltd, whose net loss widened threefold in the March quarter, slid 63%. 
While such volatility makes buy-and-hold investors nervous, hedge fund managers see opportunities. The regulatory landscape, meanwhile, is bound to keep shifting. Just last week President Xi Jinping urged the development of vocational training in the country.
All this means that hedge funds are likely to continue dominating the education sector. HaiLiang Education Group Inc., for example, has 52% hedge fund ownership, according to Bloomberg data based on publicly reported holdings.(1)The private-school operator returned 86% in the last six months – one of the top performers among all U.S.-listed Chinese stocks – after reporting a 66% increase in fiscal first-half profit. Hedge funds hold 73% of publicly reported shares of preschool operator RYB Education Inc., which was a decided loser (unless you were short), falling 24%. U.S.-listed Chinese stocks lost a market-cap weighted 12% over the period while education stocks gained 9.2%. 
A concentration of hedge fund ownership could magnify the extreme performances of these stocks. LAIX Inc., a purveyor of online English learning, dropped 22% Tuesday after posting another operating loss and noting that the performance of key products was “unexpectedly weak.”
Chinese leaders understand the importance of education in building a prosperous society. Last month, the Communist Party and State Council jointly published new guidelines on education reform: more moral education and physical exercise, less focus on exams. You can imagine savvy school managers rushing to set up centers that cater to the whims of the party as a result. 
Such changes create opportunities for the private sector to march in time with government policy, and present risks to those who fail to keep up. Yet even without Beijing’s shifting views, this is a crowded sector with lots of companies losing money. For hedge fund managers, it will be the spring of hope and the winter of despair.

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Thursday, August 29, 2019

McAfee Has Hired Underwriters To Pursue An IPO

McAfee and Intel
McAfee, founded in 1987 by the man of the same namesake, quickly became a dominant player in the PC anti-virus scene in the 1990s, and in 2011 Intel made a big splash by purchasing the company outright in a deal valued at $7.5 billion.
Intel (NASDAQ:INTC) renamed its new acquisition Intel Security Group and at the time had plans to integrate McAfee’s security features into its chips. For reasons unknown, Big Blue’s plans changed and Intel spun off the company in 2017 and retained a minority stake (49%) with the remainder going to private equity firm TPG Capital.
John McAfee famously asked Intel to rename the company so that he could remove his name from what he viewed as poorly coded software. In fact, the ex-founder of the outfit went so far as to say this:
I am now everlastingly grateful to Intel for freeing me from this terrible association with the worst software on the planet. These are not my words, but the words of millions of irate users.
2019 has seen a record number of tech companies go public, and is McAfee crowding the market during a time of over-valued tech IPOs?
The time may be ripe for a return to the public market, as McAfee last went public in 1999 until the Intel acquisition took it back off the market. The WSJ reports that under McAfee’s current CEO Chris Young, cash flows have dramatically improved and that the timing is right for a maxed-out valuation of the company. An IPO at this stage is rumored to bring in over $1 billion in cash to McAfee coffers.
Megabanks Morgan Stanley (NYSE:MS) and Bank of America (NYSE:BAC) are said to be the principal underwriters and according to Bloomberg’s source, a valuation north of $8 billion might be possible putting the company up near the price Intel paid for it almost 8 years ago.
McAfee received an unexpected boost when in 2015 rival Kaspersky found itself embroiled in a scandal involving potential collaboration with the Russian government, a fairly damning allegation for a security firm. U.S. President Trump even went so far as to sign legislation that banned the software on government computers.
Stepping back a bit further now seems to be a fantastic time for security-focused firms going public.
The EFTMG Prime Cyber Security ETF (NYSEARCA:HACK), which is comprised of security companies, has outperformed the S&P 500 this year by over 4%. That performance has been driven by especially strong showings by other recent security startups going public such as Crowdstrike Holdings Inc – up 150% since its IPO (NASDAQ:CRWD), Tulin Software up 25% (NYSE:TUFN), and Zscaler up a whopping 344% since going public (NASDAQ:ZS).
McAfee seems to be in a good spot here, the market as a whole seems poised to offer a solid value given its peers are doing well, and its also the lucky recipient of Kaspersky’s still-embattled corporate image.
No plans are solid as of yet, as the report today was made unofficially by anonymous sources
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Oil funds sidelined by economic uncertainty

By John Kemp
LONDON (Reuters) - Hedge fund managers cut short positions in petroleum last week amid slow vacation trading and continued conflicting signals about the health of the economy and the outlook for oil supply.
They and other money managers increased their net long position in the six most important petroleum futures and options contracts by 8 million barrels in the week to Aug. 20.
Portfolio managers were net buyers of NYMEX and ICE WTI (+18 million barrels), U.S. heating oil (+2 million) and European gasoil (+1 million) but sold Brent (-7 million) and U.S. gasoline (-5 million).
Buying was mostly driven by the covering of previous short positions rather than the initiation of new long ones, according to an analysis of regulatory and exchange data (tmsnrt.rs/2Zkqq6Z).
Funds cut short positions by 34 million barrels, including 39 million barrels in NYMEX and ICE WTI.
Fund buying of WTI seems to have been driven mostly by local factors, principally the commissioning of new pipelines, easing congestion and pressure on prices in the Permian region of Texas and New Mexico.
Hedge fund positioning is broadly neutral, with the fund community holding a dynamic long position (excluding structural longs and shorts) of just 60 million barrels.
There is plenty of scope for fund managers to add to long positions if fears about a global recession prove unfounded - or increase short positions if the economic outlook deteriorates.
Net positions have changed relatively little since the middle of June, partly because senior staff are on holiday over the summer, and partly because of uncertainty about the macro outlook.
Few changes are likely until the trajectory of the economy is clearer.
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Wednesday, August 28, 2019

Amazon may have bid farewell to Queens, but it still “hearts” the Big Apple.

After walking away from a deal to build a headquarters on the Queens waterfront in Long Island City, Amazon is back to shopping for office space on Manhattan’s West Side, sources tell The Post.
The tech giant has been in talks with owners of two shiny new skyscrapers located just one block west of Penn Station — the newly built One Manhattan West and its soon-to-be sister project, Two Manhattan West, sources tell The Post.
The online retailer is seeking “at least 100,000 square feet or much more” — just to start, one well-placed source said.
Amazon, which already has 5,000 workers in NYC, had been “seriously” looking at Two Manhattan West prior to choosing Long Island City in November, a second source said. “That interest has returned over the last few weeks,” the source added.
Brookfield, which owns the two Manhattan West towers (and another at 5 Manhattan West, where Amazon is already a tenant), denied through a spokesman that it was leasing to the Seattle company. But multiple sources pointed to the company’s strict confidentiality agreements as a potential reason.
“We don’t comment on rumors or speculation,” an Amazon spokeswoman said.
At Two Manhattan West, Amazon is eyeing space at the top of the tower, sources said. The only issue is that the building, to be located on 31st Street and 9th Avenue, won’t be ready for tenants until 2022.
One Manhattan West, by contrast, will be ready for tenants to move in this fall, including a 250,000-square-foot space in the middle of the 67-story tower. The 250,000-square-foot space won’t be available long-term, but could satisfy Amazon’s space needs until Two Manhattan is ready, sources said.
Amazon also is considering space in the US Post Office building across the street, known as the James A. Farley building — a Vornado development that will boast office space across five levels and will be ready for tenants next May, sources said.
Queens residents overwhelmingly supported plans for 25,000 new jobs with an average wage of $150,000, despite protests from Ocasio-Cortez and other politicians over $3.2 billion in capital grants and tax incentives, polls have shown.
One reason is that every job that Amazon brought to the area would have had a multiplier effect on five or more other local jobs, including at local coffee shops, dry cleaners and food franchises, said Alfredo Ortiz, president & CEO of the Job Creators Network.
Manhattan, by contrast, will barely register the growth, experts said.
“Frankly, that kind of activity gets lost in Manhattan,” said Kathryn Wylde, CEO of the nonprofit Partnership for New York City.
The Long Island City deal would also have seen Amazon invest in a 600-seat public school; a workforce development and training space; an artists’ workspace; and 149,650 square feet of public open space, among other projects — all of which is now lost.
“The investment in Long Island City was going to create a whole cluster of activity around it,” Wylde explained. “No one is going to have that same impact in Manhattan unless you go to Upper Manhattan.”
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These Macro Funds Are Winning Big In August As Volatility Surges

Several macro hedge funds are on track for a banner month in August as fears of slowing global growth and protracted trade tensions sparked a long-awaited resurgence of volatility in currency and credit markets.
Hedge funds from New York’s Haidar Capital Management to Hong Kong-based Counterpoint’s Asian macro fund have posted hefty returns in August as haven assets such as gold, the yen and Swiss franc rallied, and China’s yuan weakened.

'I would be shocked': $14 billion Illinois bond fight a longshot

(Bloomberg) — The municipal-bond market is putting long odds on a think-tank chief’s bid to have $14 billion of Illinois debt tossed out in court.
While the yields on some of the challenged state bonds jumped by more than a third of a percentage point in the weeks after the suit was filed on July 1, they’ve since reversed course amid the market’s broader rally, indicating little risk that their legal status will be cast into doubt. Taxable Illinois debt due in 2033 is now yielding 4.46%, only about 0.3 percentage point more than bonds the state issued in April that aren’t being questioned by the suit.
“You’re getting paid the extra 30 basis points to deal with this headline risk,” John Miller, co-head of fixed income at Nuveen LLC, said in an interview. His firm holds Illinois debt. “You could have this taint and outside risk, but it’s ultimately a low probability of it actually being invalidated.”
The lawsuit, filed by the head of a conservative think tank and backed by a hedge fund, has drawn widespread attention in the $3.8 trillion state and local government debt market because it could set a novel precedent for groups seeking to challenge government spending. It came after Puerto Rico’s federal overseers asked a court to void a big chunk of that bankrupt island’s debt, arguing that it was illegally issued after the government had already run up against its borrowing limits.
John Tillman, the chief executive of the Illinois Policy Institute, a conservative think tank, claims that Illinois’ bond sales for its pensions in 2003 and to cover a backlog of unpaid bills in 2017 were deficit financings that violated the state constitution, which says bonds must be issued for “specific purposes.” Illinois officials have said the borrowings were valid and criticized the case as politically motivated. Sangamon County Circuit Court Associate Judge Jack Davis is expected to issue a decision this week on whether the petition can move forward.
Spokespeople for Tillman and Warlander Asset Management, the hedge fund backing the case, declined to comment. A spokeswoman for the Illinois attorney general didn’t immediately provide a comment.
Nuveen and AllianceBernstein LP, which together own $2 billion of Illinois general-obligation bonds, filed a brief supporting the state’s argument that the debt is valid.
That appears to be the common view on Wall Street. The recent drop in the yields on the challenged Illinois bonds “likely reflects the market’s expectation that, ultimately, the suit will fail,” Bank of America Corp. analysts said in an Aug. 23 report. Invalidation of the bonds “is certainly not our base case,” according to the report.
Even if the Illinois judge allows the case to move forward, Nuveen’s Miller said he “can’t imagine that an outside plaintiff could prevent” Illinois from making its debt payments. The required three-fifths of the state’s legislators approved the debt and its purpose to pay accruing bills, Miller said.
“I would be shocked if that’s not a legitimate purpose,” Miller said.




Friday, August 23, 2019

Taking distributions from your traditional IRA


If you’re like many people, you’ve worked hard to accumulate a large nest egg in your traditional IRA (including a SEP-IRA). It’s even more critical to carefully plan for withdrawals from these retirement-savings vehicles.
Knowing the fine points of the IRA distribution rules can make a significant difference in how much you and your family will get to keep after taxes. Here are three IRA areas to understand:
  1. Taking early distributions. If you need to take money out of your traditional IRA before age 59½, any distribution to you will be generally taxable (unless nondeductible contributions were made, in which case part of each payout will be tax-free). In addition, distributions before age 59½ may be subject to a 10% penalty tax.

    However, there are several ways that the penalty tax (but not the regular income tax) can be avoided. These exceptions include paying for unreimbursed medical expenses, paying for qualified educational expenses and buying a first home (up to $10,000).
  2. Naming your beneficiary (or beneficiaries). This decision affects the minimum amounts you must withdraw from the IRA when you reach age 70½; who will get what remains in the account at your death; and how that IRA balance can be paid out. What’s more, a periodic review of the individuals you’ve named as IRA beneficiaries is critical to assure that your overall estate planning objectives will be achieved. Review them when circumstances change in your personal life, finances and family.
  3. Taking required distributions. Once you reach age 70½, distributions from your traditional IRAs must begin. It doesn’t matter if you haven’t retired. If you don’t withdraw the minimum amount each year, you may have to pay a 50% penalty tax on what should have been taken — but wasn’t. In planning for required minimum distributions, your income needs must be weighed against the desirable goal of keeping the tax shelter of the IRA going for as long as possible for both yourself and your beneficiaries.
Keep more of your money
Prudently planning how to take money out of your traditional IRA can mean more money for you and your heirs. Keep in mind that Roth IRAs operate under a different set of rules than traditional IRAs. Contact us to review your traditional and Roth IRAs, and to analyze other aspects of your retirement planning.
© 2019




Pemberton Raises €3.2bn for New Direct Lending Fund

Asset management firm Pemberton has raised an extra €3.2bn for its European Mid-Market Debt strategy thanks to a pair of new funds.
The firm, which is backed by insurance major Legal & General, has closed the capital across its European Mid-Market Fund II and debut UK Mid-Market Fund.
Pemberton closed its first European Mid-Market Fund on €1.2bn in 2016, landing commitments from 27 institutions including the Illinois Teachers Retirement System.
Pemberton also pulled in €1bn for its Strategic Credit Opportunities Fund, a primary-focused credit opportunities vehicle, earlier this year as it looks to diversify its investment platform.
Symon Drake-Brockman, Managing Partner of Pemberton, said, “This growth is testament to the confidence that investors have in Pemberton.
“We are established as a strong, long-term steward of their capital. And we continue to build a platform that provides innovative opportunities across the capital structure for investors and borrowers.
“As banks continue to de-risk and de-lever, there are several trillion that will need to come off their balance sheets in the coming years.
“With one of the largest pan-European teams dedicated to direct lending opportunities, Pemberton is well-placed to connect capital and fill this funding demand that stems from borrowers across the region.”
Recent deals from Pemberton include backing Bulgin, a UK-headquartered manufacturer of environmentally sealed high-performance engineered solutions, and Laboratorios Larrasa, a clinical and genetic laboratory business headquartered in Spain.
Pemberton opened two new offices in the first six months of the year, expanding into Amsterdam and Copenhagen, as well as strengthening its team with 10 new people.
That included the appointment of Boris Harmsen as managing director and head of Benelux and Jean Tournaire as portfolio manager.
Copyright © 2019 AltAssets
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Amazon to acquire minority stake in an Indian supermarket chain operator

MUMBAI/BENGALURU (Reuters) - Amazon.com Inc is set to snag a 3.58% minority stake in India’s Future Retail, which operates more than 1,500 stores in India and owns several supermarket brands, including budget department and grocery store chain, Big Bazaar.


Future Retail said in a regulatory filing late on Thursday that Amazon has agreed to acquire a 49% stake in Future Coupons Ltd. That entity in turn owns a 7.3% interest in Future Retail, according to prior filings.
The companies did not disclose the value of the deal, which gives Amazon a stake in one of India’s biggest retail chains, whose stores sell everything from clothes to fresh produce.
The transaction valued Future Retail at a “substantial premium” to its existing market price, a source familiar with the matter told Reuters.
The Economic Times reported that the deal pegged the Mumbai-based company’s value at about 430 billion rupees ($5.98 billion), more than double its current market capitalization of $2.91 billion.
Amazon and Future Retail declined to comment on the value of the transaction that remains subject to regulatory approval.
Future Retail’s shares were down 5% at 393 rupees in morning trade in Mumbai, as many investors had expected Amazon to purchase a 10% stake based on previous media reports. The two sides have reportedly been in talks for more than a year.
“The earlier expectation was Amazon would invest via a fresh issue, but now the money’s going to the promoter and the company is not benefiting,” said Deepak Jasani, senior vice president at HDFC Securities. “People had bought on expectation, and now are selling on the news.”
The regulatory filing said the deal gives Amazon the right of first refusal should Future Retail’s founder, Kishore Biyani, or his family decide to further trim the 47.02% stake they own in the company, both directly and via entities like Future Coupons that they control.
The online retailer announced plans on Thursday to launch its Amazon Fresh service to select areas in India’s tech hub of Bengaluru, the e-commerce company’s first such foray into delivering fresh produce in India, seen its last major growth market.
In addition to over 290 Big Bazaar outlets, Future Retail also operates a dozen up-market grocery stores under the banner, Foodhall. Convenience store chain 7-Eleven Inc has also tied up with Future Retail to operate its stores in the country.
The Future Retail transaction marks Amazon’s second such move to acquire a stake in an Indian supermarket store operator. Last year, Amazon and Indian private equity firm Samara Capital announced a joint investment in an entity that would give Amazon a stake in Indian supermarket chain More. Amazon also owns a stake in Indian department store chain Shopper’s Stop.
Early this year, India revised its e-commerce rules, creating hurdles for Amazon and rival Walmart Inc’s e-commerce subsidiary, Flipkart. One revised rule bars an entity in which a foreign e-commerce company or its group companies have a stake from selling on their online platform.
These and other restrictions forced Amazon to alter how it structures some of its equity holdings in the country.
India’s revised e-commerce regulations, along with its push to compel multinationals to store data locally, have irked the U.S. government and heightened trade tensions. India has argued the rules are aimed at protecting interests of its small traders and privacy of its citizens.
Ahead of the launch on Wednesday of Amazon’s biggest campus in the world, in the southern Indian city of Hyderabad, Amazon’s India head, Amit Agarwal, said India should encourage e-commerce and not try to “define every single guard rail under which it should operate.”

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Reporting by Euan Rocha in MUMBAI and Nivedita Bhattacharjee in BENGALURU; Editing by David Gregorio and Stephen Coates


Thursday, August 22, 2019

Apple reportedly plans to launch two ‘Pro’ iPhones within weeks

Apple plans to unveil three new iPhones next month, including two new “Pro” models and a successor to the iPhone XR, Bloomberg reported Thursday.

The “Pro” models are meant to replace the iPhone XS and iPhone XS Max, according to the report. They’ll be packed with major upgrades to the rear-facing camera, including a sensor for capturing ultra-wide-angle photos and videos, which is a first for Apple, according to Bloomberg. The new camera system will also allow for better photos in low-light environments, while enabling things like the ability to capture three images at once.

Apple plans to add a second rear camera to the iPhone XR successor, enabling features like enhanced portrait mode, as well as optical zoom, which allows users to zoom in further without impacting quality, Bloomberg reported.

All the new models are expected to include a new multi-angle Face ID sensor, enabling users to unlock their device even if it’s laying flat on a table, Bloomberg reported. 

Apple is said to be bringing faster A13 processors to each of the three iPhones, which is likely to power improved computer vision and augmented reality capabilities.

Aside from iPhones, the company is also likely to release refreshed iPads and MacBook Pros in the fall, according to the report. It’s also working on updated versions of AirPods and the HomePod smart speaker.

Representatives from Apple were not immediately available for comment.

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Apple reportedly plans to launch two ‘Pro’ iPhones within weeks

Apple plans to unveil three new iPhones next month, including two new “Pro” models and a successor to the iPhone XR, Bloomberg reported Thursday.

The “Pro” models are meant to replace the iPhone XS and iPhone XS Max, according to the report. They’ll be packed with major upgrades to the rear-facing camera, including a sensor for capturing ultra-wide-angle photos and videos, which is a first for Apple, according to Bloomberg. The new camera system will also allow for better photos in low-light environments, while enabling things like the ability to capture three images at once.

Apple plans to add a second rear camera to the iPhone XR successor, enabling features like enhanced portrait mode, as well as optical zoom, which allows users to zoom in further without impacting quality, Bloomberg reported.

All the new models are expected to include a new multi-angle Face ID sensor, enabling users to unlock their device even if it’s laying flat on a table, Bloomberg reported. Apple is said to be bringing faster A13 processors to each of the three iPhones, which is likely to power improved computer vision and augmented reality capabilities.

Aside from iPhones, the company is also likely to release refreshed iPads and MacBook Pros in the fall, according to the report. It’s also working on updated versions of AirPods and the HomePod smart speaker.

Representatives from Apple were not immediately available for comment.

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