• Live Nation Inc. (LYV), the world’s largest concert promoter, said it is buying Ticketmaster Entertainment Inc. (TKTM), the world’s largest ticketing company, for $2.5 billion including debt, Reuters reported. The merger will create a music powerhouse, already unpopular with fans and likely to receive intense scrutiny from government antitrust investigators.

• China inflation continued slowing in January, rising 1%, the slowest pace in nearly seven years. “Inflation could have been close to zero or worse if not for the Chinese New Year, because vegetable prices and grain prices went up,” Wang Tao, China economist at UBS AG in Beijing, told Bloomberg.

• MillerCoors, the U.S.-targeting joint venture between Molson Coors Brewing Co. (TAP) and SABMiller plc (ADR:SBMRY), said fourth-quarter profit slid 40%. The fall is mainly due to the costs to integrate the brands and impairment charges to its Sparks brand, the Associated Press reported.

• Switzerland’s largest bank, UBS AG (UBS), said it plans to cut another 2,000 jobs, this time at its security unit. Chief Executive Officer Marcel Rohner said the bank will return to profit in 2009, aided by help from the Swiss government to split off toxic assets, Bloomberg reported.

• Prices of call options to buy gold have almost doubled since Jan 15, as financial turmoil boosts demand for the precious metal, Bloomberg reported. Options contracts that allow holders to buy 100 ounces of gold for $1,000 each by April  traded as high as $17.50 yesterday on the New York Mercantile Exchange, as compared with $7.70 on Jan. 15. In that same period, options contracts that allow traders to sell gold at $800 by April plunged 82 percent.
• Oil prices fell below $39 a barrel on Tuesday after the U.S. Energy Information Administration revised downward its 2009 global oil demand forecast by 400,000 barrels per day predicting demand will fall by 1.17 million bpd from 2008, Reuters reported. The agency said it revised its demand forecasts on concerns the U.S. stimulus plan unveiled by the Obama administration will not stem the recession.  U.S. crude fell 63 cents to $38.93 a barrel. London Brent traded down 1 cent to $46.01 a barrel.
• Wal-Mart Stores Inc. (WMT) is cutting 700 to 800 jobs at its home office in Arkansas, as the world’s largest retailer looks to realign its corporate structure and reduce costs, Reuters reported. The discount retailer, which has roughly 14,000 employees at its headquarters, is eliminating jobs in merchandising, real estate and marketing in its Wal-Mart U.S. division, while cutting merchandising positions at its Sam’s Club division.
• Cisco Systems Inc. (CSCO) the giant network equipment maker, launched a surprisingly large $4 billion debt sale on Monday, raising speculation that was poised to make an acquisition, Reuters reported.  The offering came on the same day Cisco said it would offer senior notes to help pay back $500 million of debt due this month. The company said it would also use the proceeds of the offering to bolster its domestic cash position of $3 billion to $4 billion.

Source: Global Investment News Briefs Wednesday, February 11th, 2009

This from Penny Sleuth:

What do frozen desserts, designer handbags, and underwear have in common? Two of the best investment opportunities this decade. Allow me to explain…

A single company – one you’re probably familiar with – sold all three seemingly unrelated products. A few years ago, Sara Lee Corp (NYSE:SLE) – maker of frozen (yet tasty) pies and cakes – owned hundreds of brands, many of which made no sense.

For instance, the frozen cheesecake manufacturer was the sole owner of Coach handbags and Hanes underwear. These two subsidiaries obviously didn’t make much sense to the company. That’s why – during two separate transactions – Sara Lee’s management and board of directors divested them through a process known as a spinoff.

Spinoffs are common in the business world. They can present smart investors with huge opportunities and sometimes, less fortunate investors with even larger losses. Spinoffs are usually as simple as they sound – a parent company decides it can do without one of its business. So, the subsidiary is spun off onto its own.

There are four basic reasons for a parent to spinoff one of its “children”:

• Unrelated Businesses – many times, companies like Sara Lee own certain subsidiaries – like Coach and Hanes – they have no business owning. This happens often in conglomerates when a certain product takes off and is held back by the organization of the parent company.

• Tax Benefits – taxes can be burdensome and confusing. But every once in a while, the mathematicians and financial wizards find a loophole to save on taxes and preserve shareholder value. Occasionally, it takes a spinoff to do it.

• Refocusing – oftentimes, a large company will take a look at its operations and find one of its businesses lagging behind, which inevitably puts a strain on management to fix the problem. The best solution is to spinoff this business so management of the parent company can get back to growing profitable businesses. This often benefits both the parent and “child” company.

• Pinching Off Debt – some spinoffs are created to unload debt and other burdensome liabilities. This is where many unfortunate investors take enormous losses. As you can imagine, a company created out of a need to unload debt is doomed from the start.

It’s important to decipher between the four reasons because if you find the right one, you stand to make colossal gains. Let’s look back at our top example…

As we noted, Sara Lee’s situation fits the first mold – unrelated businesses. Spinning off a perfectly capable business creates earning potential neither the parent nor the “child” even realized.

Sara Lee first spun off Coach in 2000. Almost immediately, the newly formed Coach Inc (NYSE:COH) began its own marketing program. This turned into an enormous success and unrealized profit potential came to light, which shot shares straight up over the next six years. As you can see in the chart below, Coach outperformed its former parent by more than 2,000% to negative 15%.

The same thing happen in round two, when Sara Lee spun off Hanesbrand Inc (NYSE:HBI) in 2006. Although the gains were not as fantastic, Hanes shareholders watch their shares double as Sara Lee shares stayed flat:

Of course, not all spinoffs work this way. It takes serious studying and an ear to the ground to find out exactly what’s going on.

Many times, when parents spinoff businesses, they keep it quiet. If the media gets a hold of it, shares can crash artificially, or spike prematurely. And, as we mentioned, many spinoffs negatively affect shareholders.

One recent example is InterActiveCorp’s (Nasdaq:IACI) spinoff of Ticketmaster Entertainment Inc (Nasdaq:TKTM) . When Ticketmaster was sent on its way, InterActiveCorp left it with a parting gift of about $750 million in debt, just as the credit crisis began to peak this summer. Shares of Ticketmaster, inevitably collapsed under this weight, falling more than 80 %:

Of course, you have to use your best judgment when you discover a spinoff. You’ll have to make the decision on why you think the parent company spun it off.

More than not, however, buying spinoffs when they’re fresh is a pretty good idea. According to Chris Mayer of Mayer’s Special Situations – a newsletter focused on spinoffs and other unique investments – “spinoffs beat their industry peers and outperformed the S&P 500 Index by about 10% per year in their first three years of existence.”

Those numbers account for both spin offs that lead to gains and those that lead to losses. Obviously, this is something to look into.

If you are lucky enough, and have the right inside knowledge, you can easily take advantage of the next Coach spinoff and leave the next Ticketmaster alone.

Source: Spinoff Stocks: Quick, Proven Way to Grab Easy Gains

But there are profits to be made in the small-cap market says Laura Cadden in Today’s Financial News. She’s found three great small-cap stocks going for bargain prices. All three have solid valuation ratios and strong short-term growth prospects.

They are Javo Beverage Company (OTC:JAVO), The Home Shopping Network (NASDAQ:HSNI), and Take-Two Interactive Software (NASDAQ:TTWO).

Best Small Cap #1

A poor man’s Starbucks: Javo Beverage Company, Inc. (OTC:JAVO).

Ah… coffee. Coffee addicts NEED their java. But we’ve already seen that in tough times, people are stepping away from the Starbuck’s counter.

That’s where these guys come in.

Good, fast and CHEAP coffee

Javo Beverage Company, Inc.’s main focus is on dispensable tea and coffee. The company manufactures and markets beverage concentrates, as well as formulations, extracts and flavors, to restaurants and retail outlets.

A sampling of their client list includes 7-Eleven, Sysco Food, BP Products North America, Exxon-Mobil, Mrs. Fields, Haagen-Dazs, Caribou Coffee, Sunoco, Shamrock Foods and Speedway.

Javo greatly increased their outlet potential in the second quarter of this year resulting in excellent results primarily from iced coffee sales.

On July 30, the company announced record revenues for the second quarter of 2008 of 6.7 million. A record gross margin of a remarkable 49% was also achieved for the quarter.

Javo’s target for dispenser installation for this year was 7,500. They achieved that goal by the end of July.

Turning to their hot coffee product, they are now ready to have 10,000 dispensers in place by year’s end. Each new location is anticipated to produce between $3,000 and $6,000 in revenue annually.

This company is one of the most promising small caps I’ve seen this year and the price is below $1!

What’s not to love?

I recommend you buy shares of Javo Beverage Company, Inc. (OTC:JAVO) for at or under $0.60 a share.

*****

Best Small Cap #2

On the cutting edge of retail: The Home Shopping Network (NASDAQ:HSNI)

Her name is Mary-Ann and she is an addict.

Her addiction? The Home Shopping Network (HSNi) owned and operated by HSN, Inc.

Mary-Ann (actually NOT her real name) tells me that she can’t help it… the convincing chatter by charming hosts, the phoned-in testimonials, the seemingly reasonable prices, the “limited number available” push, and the countdown clock – it just wins her over every time.

She’s not alone… The 24/7 HSNi channel reaches 90 million households in the U.S.

And in 15 million of those homes, they also have the latest technological advance in TV purchasing – Shop By Remote.

In addition, HSNi has one of the top 10 e-commerce websites (http://www.hsni.com).

Cornering the market

HSN Inc. has another operating segment, Cornerstone, which is made up of seven popular brands including The Territory Ahead, Smith+Noble, Frontgate, Ballard Design, Garnet Hill, Improvements and Travelsmith.

Each brand has its own website and catalog (400 million are mailed out annually!).

HSN, Inc. began trading on its own in late August.

Formerly, it had been part of IAC/InterActiveCorp (NASDAQ:IACI) but was spun off along with Interval Leisure Group, Inc. (NASDAQ:IILG), Ticketmaster (NASDAQ:TKTM), and Tree.com Inc. (NASDAQ:TREE).

Since the separation (and the volatile market in recent weeks) the stock price has decreased in value.

Its current PE ratio is hovering around 6 – always a good thing!

Most importantly, these people KNOW how to sell and with the peak retail season fast approaching, I expect this stock price to climb steeply.

I recommend you buy shares of HSN Inc. (NASDAQ:HSNI) at or under $12.

*****

Best Small Cap #3

Failure to merge = good news for you: Take-Two Interactive Software, Inc. (NASDAQ:TTWO)

After prolonged negotiations, Electronic Arts Inc. (NASDAQ:ERTS) will not be purchasing Take-Two Interactive Software, Inc.

News of this prompted seven-year lows in the stock price of Take-Two providing a great buying opportunity.

Highway robbery

Take-Two’s claim to fame (or infamy, depending on your perspective) is its “Grand Theft Auto” video game series.

Wildly successful, these games often top the list of objectionable entertainment due to their seeming glorification of criminality and excessive violence. (No doubt that accounts for much of their popularity.)

A sampling of Take-two’s other franchises include Sid Meier’s Civilization, Manhunt, BioShock, Sid Meiers’s Railroalds!, Top Spin, Sid Meier’s Pirates, and Max Payne.

Headquartered in New York City, the company’s publishing segment is made up of Rockstar Games, 2K Games, 2K Sports and 2K Play labels.

Can’t argue with the numbers

After a showing a negative balance in 2007 (with a net margin of –14.10%), Take-Two clearly buckled down their operating expenses. That, and the over 6 million(!) copies of Grand Theft Auto IV sold after its April release, resulted in an increased net margin of 11.95% as of Q3 (ending July 2008).

The company’s PE ratio is just under 12, its forward PD is 10.81 and its PEG is an amazing .56. Now with recent market devaluations, these numbers are not the full picture, but they are still indications of a good investment.

On the table

The Take-two executive chairman of the board, Strauss Zelnick, has said that the company is communicating with other parties to consider “strategic alternatives.”

Any additional takeover bids should be good for shareholders.

Besides the decent fundamentals, profits and buyout possibilities, there are all those fans that failed to get “GTA IV” in the spring. They will no doubt be placing it at the top of their hoped-for holiday gift lists, which should give the stock price a nice bump.

I recommend you buy shares of Take-Two Interactive Software, Inc. (NASDAQ:TTWO) at or under $21.

Source: The 3 Best Small Caps to Own This Fall: A TFN Special Report