5 Winners and Losers of the Week in Business
Snapchat -- Loser
If Facebook (FB) offers you a $3 billion check, do you really turn it down? Sources this week reported that Facebook offered the makers of Snapchat -- the popular app that allows users to send photos and short videos that disappear after a brief amount of time -- a whopping $3 billion buyout.
Snapchat passed on the deal.
Now, it's easy to reflect back several years ago when Facebook rebuffed a buyout offer for a little more than $1 billion. Some ridiculed Facebook's decision at the time, but it's a $120 billion company now. However, at least Facebook had a clear path to monetization.
Snapchat may be soaring in popularity with teens sending risque snapshots, taunts, and jokes to one another, but the moment you begin slapping display ads on the product, it's will find it much harder to sustain that arc.
Macy's (M) -- Winner
You always want to have healthy momentum going into the telltale holiday quarter, and that's exactly what Macy's did by offering up blowout quarterly results on Wednesday. Sales at department stores open at least a year climbed 3.5 percent, and while heavy promotions were needed to woo shoppers, earnings still managed to soar 22 percent to $0.47 a share. Analysts were settling for a profit of $0.39 a share.
It's unlikely that the many retailers reporting next week will be as upbeat, but for one chain at least this really was a miracle on 34th Street.
Starbucks (SBUX) -- Loser
Starbucks chose to break free of its retail distribution contract with Kraft Foods (KRFT) two years ago, and now the java giant's been slapped with a $2.8 billion judgment. Yes, Starbucks is good for the money, but it's still a pretty stiff price to pay for backing out of a deal. The $2.8 billion is just a little less than what Starbucks has earned over the past two years combined.
U.S. Postal Service -- Winner
You don't hear a lot of favorable assessments of the state of the United States Postal Service, but that happened this week when Amazon.com (AMZN) chose the mail carrier -- instead of FedEx or UPS -- to be its partner for the Sunday deliveries that will start this weekend in New York City and Los Angeles.
%VIRTUAL-article-sponsoredlinks%The U.S. Postal Service is still losing money, but this is a big win for a delivery platform that was threatening layoffs and an end to Saturday mail deliveries. Now, its seldom-used Sunday parcel delivery service will keep postal workers busy and employed.
It goes without saying that the move itself is also brilliant on Amazon's part since it will extend the shipping dates of what will be a short holiday shopping season.
JPMorgan Chase (JPM) -- Loser
Sometimes if you grab social media bull by the horns you get gored.
JPMorgan helped take Twitter (TWTR) public earlier this month, so it probably thought it would be throwing it a bone by hosting a question-and-answer session with its vice chairman and top deal-maker. JPMorgan asked the public for questions under the hashtag #askjpm, and folks irate about the "too big to fail" banking crisis, JPMorgan's role in the financial meltdown, and a host of other antisocial banking behaviors shot back with a fire hose of sarcasm, humor and bile.
JPMorgan decided on Thursday to nix the Q&A after the mocking got to be too much. I guess you can call this death by hashtag.
Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Amazon.com, Facebook, and Starbucks. The Motley Fool owns shares of Amazon.com, Facebook, JPMorgan Chase, and Starbucks. Try any of our newsletter services free for 30 days.