By Francesca Fontana
E*Trade Financial Corp.
The long-predicted M&A frenzy in the wealth management industry is here. Wall Street stalwart Morgan Stanley agreed to buy discount broker E*Trade in a $13 billion deal announced Thursday. The all-stock deal is the biggest takeover by a giant U.S. bank since the 2008 crisis. Earlier in the week, money manager Franklin Resources Inc. agreed to buy rival Legg Mason Inc. for $4.5 billion in cash. E*Trade shares soared 22% Thursday.
The coronavirus is rippling through the world's most valuable company. Apple said Monday it won't meet its revenue projections for the current quarter, as the coronavirus has limited iPhone production and curtailed demand in China. Apple's announcement is the most prominent example yet of the effects of the virus on global business and markets. Apple's dependency on China's manufacturing and consumer sectors makes the company vulnerable as the coronavirus outbreak paralyzes the country. The company said the situation in China is evolving, and it will provide more information when it holds its earnings call in April. Apple shares fell 1.8% Tuesday.
Even the world's biggest retailer struggled to get shoppers to spend during the holiday season. Walmart executives said the critical period started strong around Thanksgiving but sales of toys, videogames and apparel softened in the weeks before Christmas. Chief Executive Doug McMillon said store sales suffered from a late Thanksgiving as well as some merchandising missteps, such as a lack of high-price, in-demand holiday toys and a glut of inexpensive clothes and seasonal attire. Meanwhile, Walmart's U.S. e-commerce sales rose 35% in the fourth quarter, boosted by online grocery orders. Shares rose 1.5% Tuesday.
Bed Bath & Beyond Inc.
The new CEO of Bed Bath & Beyond wants to eliminate "purchase paralysis." To do that, Mark Tritton wants to declutter stores, make aisles wider and stop piling merchandise up to the ceiling. The former Target Corp. executive laid out his vision for remaking the troubled retailer Tuesday. Mr. Tritton plans to trim inventory by more than 10% this year, part of a broader plan that calls for spending as much as $400 million on store remodels, technology upgrades and supply-chain improvements. He joined the struggling company in November after its top officials, including the founders, were ousted by an activist investor. Shares gained 5.4% Tuesday.
L Brands Inc.
Les Wexner is giving up control of Victoria's Secret. The 82-year-old billionaire behind the lingerie brand and Bath & Body Works agreed Thursday to sell a controlling stake in the Victoria's Secret chain to private-equity firm Sycamore Partners for $525 million. He also agreed to step down as chairman and chief executive of L Brands. His decision to part ways with Victoria's Secret is an admission that Mr. Wexner couldn't revive the fortunes of the troubled brand he built around shopping malls and sex appeal. The deal leaves the Victoria's Secret business as a separate private company, and L Brands will be reduced to running one chain: Bath & Body Works. L Brands shares fell 3.6% Thursday.
ViacomCBS has a tough year ahead. The company reported a loss in the quarter as Viacom completed its merger with CBS and said it is targeting $750 million in cost cuts for the year, increasing its guidance from $500 million. The company also unveiled its three main streaming plans that will compete with Netflix Inc. and others: a free ad-supported service called Pluto TV, an expanded version of CBS All Access, and a third service anchored by Showtime that will be the most expensive option. "We believe this strategy of free, broad pay and premium pay is where the market will go," Chief Executive Bob Bakish said. Shares plummeted 18% Thursday.
Wells Fargo & Co.
Wells Fargo has reached a settlement with the government over its long-running fake-account scandal. The nation's fourth-largest bank agreed Friday to pay $3 billion to settle investigations by the Justice Department and the Securities and Exchange Commission. It is a victory for Charles Scharf, the bank's new boss who was tasked with resolving the crisis. Regulators and prosecutors could still take action against individuals involved in the debacle, in which it became public in 2016 that an aggressive sales culture led employees to open millions of possibly fake accounts. Last month, the Office of the Comptroller of the Currency charged eight former Wells Fargo executives over the scandal, including the former CEO. Wells Fargo shares gained 0.8% Friday.
Write to Francesca Fontana at email@example.com
Corrections & Amplifications
This article was corrected Feb. 24, 2020 because Bed Bath & Beyond Inc.'s name was given incorrectly as Bed Bath & Belong in the original version.