|Bid||199.46 x 1000|
|Ask||199.36 x 800|
|Day's range||194.34 - 199.70|
|52-week range||124.23 - 221.93|
|Beta (5Y monthly)||0.66|
|PE ratio (TTM)||31.51|
|Earnings date||20 Oct 2020 - 26 Oct 2020|
|Forward dividend & yield||5.00 (2.57%)|
|Ex-dividend date||31 Aug 2020|
|1y target est||213.03|
(Bloomberg Opinion) -- When Louis DeJoy became postmaster general in May, he was the first person in more than 20 years to run the U.S. Postal Service who had never worked there. His predecessor, Megan Brennan, had spent her entire career with the service, originally as a mail carrier.On the other hand, DeJoy, an accountant, founded and sold a company, New Breed Logistics, that worked for decades with the Postal Service and other public and private enterprises wrestling with supply and transportation challenges. DeJoy’s Postal Service work while running New Breed reportedly focused on the basics: repairing postal equipment, mail bags and hampers.In theory, what DeJoy lacked in familiarity and expertise would be more than offset by a fresh, outside perspective and an ability to help modernize the Postal Service, which employs almost 500,000 people, operates a massive domestic retail network (bigger than McDonald’s Corp., Starbucks Corp. and Walmart Inc. combined) and, until Covid-19 arrived, was delivering 182 million pieces of first-class mail daily.I would think DeJoy also came to the attention of the Postal Service’s board of governors because he is a generous political donor to President Donald Trump and the Republican Party. Since 2016, according to Federal Election Commission records, DeJoy has donated more than $2 million to Trump’s campaign and other Republican groups. As recently as February, he gave $210,600 to a political action committee, Trump Victory. The Republican National Committee and the McConnell Senate Committee have also received money from DeJoy. In 2017, he hosted a joint fundraiser for Trump and the RNC at his North Carolina home.DeJoy’s wife, Aldona Wos, is vice chairwoman of the President’s Commission on White House Fellowships and was nominated by Trump to be the next U.S. ambassador to Canada. DeJoy and Wos have disclosed financial assets worth $30.1 million to $75.3 million, the bulk of which is tied up in the company that bought New Breed from them. But they also have small stakes in Postal Service competitors, such as United Parcel Service Inc.All of this has weighed heavily on DeJoy’s brief tenure. When he arrived at the Postal Service, Treasury Secretary Steven Mnuchin was leading a White House effort to leverage federal bailout funding to get the struggling agency to agree to greater presidential control. Trump himself was exercising his animus toward Jeff Bezos, founder of Amazon.com Inc. and owner of the Washington Post, threatening to tie up the $10 billion Congress had earmarked for the Postal Service until it raised prices for package deliveries Amazon relies on.That mud wrestling prompted the resignation of a veteran member of the Postal Service’s board of governors. Another veteran left the 11-member board after DeJoy’s appointment. In short order, the postal workers’ union and Democrats in Congress voiced concerns that the Postal Service had become politicized and that DeJoy was a stalking horse for Trump’s resentments — and for the possibility that the beleaguered president would use the service to undermine mail-in voting for the November election.In mid-July, DeJoy made a number of operational changes, including eliminating overtime for postal workers and shorter post office hours, that promised to slow down mail delivery and could throw a wrench into mail-in voting. DeJoy said it was all about cost-cutting and efficiency. Senior Democrats on the House Committee on Oversight and Reform wondered otherwise and on July 20 asked DeJoy to respond to requests for more information about those changes. They also wanted to know why he was running the Postal Service like a “private company” rather than “the constitutionally mandated public service that it is.”As I wrote in April, there’s no question that the Postal Service needs improvement, and if that means adopting some private sector practices, so be it. But there’s no reason to believe that’s why Trump has taken such a close interest in it. The president has tried to bend federal agencies to his whims or self-interest rather than refashion them as engines of enhanced public service. The Postal Service is no exception.Trump and Attorney General William Barr also have repeatedly, and falsely, slagged mail-in voting as riddled with fraud, despite the fact that both of them and 14 other senior Trump administration officials have voted by mail. Why wouldn’t they take the next logical step and disrupt the Postal Service’s machinery with federal fraud investigations draped in the cloak of “good government” — particularly when Trump is deeply underwater in most presidential polls and has been saber-rattling about postponing Election Day?That possibility isn’t lost on casual observers, including former presidents. During his eulogy last week for Representative John Lewis, Barack Obama warned that an attack on voting rights is already being conducted “with surgical precision, even undermining the Postal Service in the run-up to an election that is going to be dependent on mailed-in ballots so people don’t get sick.”Most states allow some form of mail-in voting. Although Republicans fear it favors Democrats, studies have indicated that it hasn’t provided an advantage historically for either party. Still, anything that makes voting easier increases turnout, and increased turnout has always been a boon to Democrats. And this election year is unlike any other in the modern era because of the Covid-19 pandemic, economic upheaval, social protests, and the partisan passions sparked by Trump. Americans are likely to be highly motivated to vote while also being deeply worried about doing so safely at public polling booths.Voters also favor voting early, using mail-in ballots. The number of voters who have done so on Election Day more than doubled to 57.2 million in 2016, from 24.9 million in 2004 — an increase from about 20% to 40% of all ballots cast. The 2020 election promises to bring an even greater spike. States, which actually run elections despite White House views to the contrary, will need fiscal and logistical support to manage what is likely to be a massive upswing in mail-in voting.Prompt delivery of mail-in ballots will be key to this functioning well. A majority of states won’t accept mail-in ballots unless they arrive by Election Day, even if they’re postmarked prior to Election Day.I’m sure the postmaster general wouldn’t want to see tens of millions of ballots arrive after Election Day, depriving Americans of a fundamental right. But to make sure, Congress will need to do more than write DeJoy threatening letters — it will need to keep the public and voters focused on how he’s running the Postal Service and hold him, the Justice Department and the White House accountable.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Timothy L. O'Brien is a senior columnist for Bloomberg Opinion.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- HSBC Holdings Plc can’t seem to get a break. Even the financial-market boom that buoyed profits at some banks wasn’t enough to save Europe’s biggest lender from missing estimates. Chief Executive Officer Noel Quinn said HSBC is looking at accelerating restructuring plans that are expected to lead to the loss of 35,000 jobs. He may need to think even more radically.The bank reported second-quarter adjusted pretax profit fell 57% from a year earlier to $2.59 billion, versus an estimate of $2.94 billion. HSBC lifted its projection for loan losses to between $8 billion and $13 billion for this year, as it contends with the economic impact of the Covid pandemic. The shares fell as much as 4.7% in Hong Kong trading, reaching their lowest since the depths of the global financial crisis in 2009.Shrinking its workforce can’t fix the geopolitical headwinds the bank is facing. Headquartered in London but focused on Asia, HSBC is trapped between the demands of the U.K. and U.S. on one side and China on the other. With relations deteriorating and little prospect of an improvement, it may be time for the bank to consider separating its Asian business from the rest.HSBC appears to have few allies in government. British lawmakers criticized the bank for showing support for China’s national security legislation in Hong Kong, while U.S. Secretary of State Michael Pompeo attacked what he called “corporate kowtows.” At the same time, toeing China’s line appears to have won HSBC scant reward in Beijing. The Communist Party’s People’s Daily newspaper published an opinion piece last week saying the bank was an accomplice of the U.S. in the arrest of Huawei Technologies Co. Chief Financial Officer Meng Wanzhou and fabricated evidence against the company. HSBC has denied the allegations. The attacks have helped to drive the slump in HSBC’s Hong Kong-traded shares this year. They have lost 45%, far exceeding the 13% decline in the city’s benchmark Hang Seng Index.HSBC’S London and Hong Kong listings serve largely different investor bases. That alone might argue for some form of separation. As Bloomberg Intelligence analyst Jonathan Tyce says, the bank could look into withdrawing from one of the markets. “We suspect that, as with many U.S. global tech companies, HSBC may choose to wait and see if a change in the U.S. presidency in November will ease this threat, but longer term, dual-listing will probably be reassessed,” he said. A more fundamental shift would be to spin off the non-Asian business, creating two companies with separate management teams and perhaps listings. That might give HSBC a better chance of satisfying government and legal expectations in different parts of the world. At present, the bank faces being caught between conflicting demands of the national security law and potential U.S. sanctions against Chinese officials involved in imposing the legislation on Hong Kong.There is a precedent. In early 2017, McDonald’s Corp. sold most of its Hong Kong and China business to a tie-up between state-owned Citic Ltd. and U.S. private equity firm Carlyle Group LP. Yum! Brands Inc., meanwhile, owner of the KFC and Pizza Hut brands, spun off Yum China for a separate listing in November 2016.These changes appear to have insulated the companies against anti-American sentiment fueled by worsening trade tensions between China and the U.S. Yum China has outperformed its former parent since the spinoff. The prospect of Microsoft Corp. buying TikTok’s U.S. operations shows how the world is growing accustomed to the idea of sensitive businesses being carved into separate spheres of influence with different owners.A side-benefit of splitting the Asian business might be to shift its domicile back to Hong Kong. That would enable the more-profitable regional unit to resume dividend payments, which HSBC was forced to cancel earlier this year at the behest of U.K. regulators. That decision angered HSBC’s legion of small shareholders in Hong Kong and has contributed to the stock’s underperformance this year.Such a restructuring might face considerable regulatory hurdles. Quinn called the last few months the most challenging in living memory. Without radical change, HSBC may remain stuck between a rock and a hard place. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Nisha Gopalan is a Bloomberg Opinion columnist covering deals and banking. She previously worked for the Wall Street Journal and Dow Jones as an editor and a reporter.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
It was a terrible quarter for the fast-food leader, but here's how the burger joint will drive more growth.