Like gossip on The Real Housewives of Miami, it's officially leaked that telecom giant AT&T (NYSE:T) approached DirecTV about buying the satellite TV legend. The Wall Street Journal broke the news late Thursday, predicting that the deal would be worth $40 billion -- which wouldn't be too much compared to AT&T's value by market capitalization -- its stock price multiplied by the number of AT&T shares -- of $185 billion.
Matchmaking is all about compatibility according to the eHarmony commercials we always see. And for these two, the numbers are adding up: DirecTV is the second largest U.S. TV operator, with 20 million viewers, while AT&T's landline biz provides service to nearly 6 million Americans. AT&T wants to expand into video, and DirecTV's subscriber count keeps falling -- so why not get together?
The takeaway is that it's all about timing. And this potential acquisition comes just after competitor Comcast snagged Time Warner Cable, which would rival this deal with more than 30 million customers. Should AT&T's bid go through, like Comcast, it will next have to face the Justice Department to determine how it weighs on competition, and whether it will affect your ability to watch Seinfeld reruns.
So why is one stock up and one down? Shares of Conoco gained 1% after revenues rose from $14.6 billion to $16 billion during the last year, while Exxon slipped 1% after revenues fell 1.5%, to $106.8 billion, from a year ago. Exxon may produce a whopping 4.1 million barrels of oil a day, but Wall Street's not happy that that sizable amount is less than its 2013 output, because its control of oil fields in Abu Dhabi expired.
The takeaway is that both oil giants are off to a heckuva 2014 (we'll spare you the jokes about both stocks being "on fire"). Natural gas is the cool new kid on the energy block, and its high prices have been kind to Exxon and Conoco's bottom lines. Plus, the price-per-barrel of oil for both companies was up a few dollars to more than $71 per barrel from the same time last year.
3. April Auto Sales send GM up, Ford down
Ford's (NYSE:F) sales dropped by 1%, to 210,355 total, in April. Pickup trucks grew for Ford, too. (Like football, Fahrenheit temperatures, and awesome light beer, pickup trucks are wildly popular in the U.S. and no where else in the world.) The stock fell by 1.5% since its Detroit rival GM won the April sales battle by a wide margin. But the big news was in the C-Suite at Dearborn, Michigan...
Ford CEO Alan Mullaly is stepping down on July 1st and passing the guard to Brooklyn born, Rutgers initiated, and Harvard Business School polished Mark Fields. Mullaly is a bit of a god at Ford headquarters for steering the company through the financial crisis without a bailout, and for 19 straight quarters of profits. But he's ready to leave on top. Ford's market value is higher than GM's, even though it makes less than 6 billion cars compared to GM's 9+ billion per year. Farewell, Alan. Ford loves you.
- The Big April Non-Farm Payrolls Report
- First-Quarter Earnings Reports: Chevron, CVS
Your credit card may soon be completely worthless
The plastic in your wallet is about to go the way of the typewriter, the VCR, and the eight-track tape player. When it does, a handful of investors could stand to get very rich. You can join them -- but you must act now. An eye-opening new presentation reveals the full story on why your credit card is about to be worthless -- and highlights one little-known company sitting at the epicenter of an earth-shaking movement that could hand early investors the kind of profits we haven't seen since the dot-com days. Click here to watch this stunning video.
Jack Kramer has no position in any stocks mentioned. Nick Martell has no position in any stocks mentioned. The Motley Fool recommends DirecTV, Ford, and General Motors. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.