Afternoon Roundup: Today's Top Stories
At The Motley Fool, we know our readers like to be informed. We have scouted out today's most relevant news items and brought them to you all in one page. We hope you find this midday edition informative and useful.
SEC not buying into Groupon
With weeks before it hits the market, Groupon is facing tough questions from the Securities and Exchange Commission. The agency is asking the company to explain some of its never-seen before accounting metrics. The company has highlighted in its regulatory filings a measure called "adjusted consolidated segment operating income." Expert said this method draws attention away from marketing costs, which is the company's biggest expenditure.
With a new trend of unprofitable tech IPOs, the SEC is worrying a tech bubble is again in the making. Internet radio company Pandora Media debuted in the market while having big losses and new measures such as total listener hours and total registered users as key metrics of growth. Read more atThe Wall Street Journal.
Credit Suisse slashing 2,000 jobs
After a disappointing second quarter with a $958 million decrease in net income, Credit Suisse (NYS: CS) said it will be cutting 2,000 jobs to reduce costs. The bank had added 1,500 jobs over the past 12 months. The cuts will be done by the end of 2012. The bank's pre-tax profit fell by 71% as the European debt crisis depressed bond trading.
Credit Suisse's earnings report came days after UBS (NYS: UBS) announced it would be missing its profit estimates for 2014 (a five-year profit estimate made in 2009) after a similar drop in the bank's income, showing that the debt crisis hurt even Europe's strongest banks. Read more atDealbook.
Slams dunk Dunkin Brands
With an IPO based on the traditional sugar and coffee products, Dunkin Brands (NAS: DKNK) , owner of Dunkin Donuts and Baskin-Robbins, opened with a bang. The company's stock opened at a higher-than-expected $19 per share and soared 46.6% to close at $27.85 and a whopping $3.5 billion valuation.
Dunkin Brands, which makes its money mainly through franchising, has the potential to grow in the West, where it has only 109 outlets unlike competitors Starbucks (NAS: SBUX) and McDonalds (NYS: MCD) , which have thousands of locations there. The company announced it could open 250 new stores in the area. Read more atThe New York Times.
Jobless claims drop to three-month low
Jobless claims in the U.S. fell to their lowest point in three months, to 398,000 in the week ended July 23. The number was lower than forecasted, but there were no specific factors associated with the drop except for the usual volatility. Though the lower number seems encouraging, higher rates of hiring will be crucial to lower unemployment, which will probably continue to hover around 9%.
In addition, major companies have announced layoffs, including Lockheed Martin (NYS: LMT) , the world's largest defense company, which will be reducing its workforce by 6,500 employees. Read more atBloomberg.
Shell and Exxon report strong earnings
Oil companies ExxonMobil (NYS: XOM) and Shell reported strong net profit of $10.68 billion and $8.66 billion, respectively. For both companies, rising oil prices were an advantage while they continue to prefer it over gas. Exxon also repurchased 67 million shares of its common stock. Shell was helped by the first time contributions of new projects in Canada and Qatar. Read more at The Wall Street Journal (ExxonandShell).
So there you have it, the top financial stories for this afternoon. Check Fool.com throughout the day for commentary on these and other stories. Also, follow us on Twitter, on Facebook, or through our email digests.
At the time this article was published Michelle Zayedowns no shares of any companies mentioned in the story. The Motley Fool owns shares of Lockheed Martin and Starbucks.Motley Fool newsletter serviceshave recommended buying shares of McDonald's and Starbucks. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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