Stocks to Track – British American Tobacco PLC (ADR) (NYSE:BTI) Servicesource International Inc (NASDAQ:SREV)
Trading the news is a technique to trade equities, currencies and other financial instruments on the financial markets. Trading news releases can be a noteworthy tool for financial shareholders. Economic news reports often drive strong short-term moves in the markets, which may create trading opportunities for traders. Declarations about corporate profits, a change in administration, rumors of a merger, are events that can cause a company’s share price to move wildly up or down. Interest rates, unemployment and export rates, or the central bank’s policy shifts, can cause a deep change of an exchange rate.
Shares of British American Tobacco PLC (ADR) (NYSE:BTI) gained 0.42% to $69.51 on Wednesday. The stock is currently floating in a range of $69.28 – 70.11. The stock is moving on high volume, traded at a volume of 18.69M shares, as compared to its average daily volume of 6.18M shares. Trading volume, or volume, is the number of shares or contracts that point towards the overall activity of a security or market for a given period. Trading volume is a key technical indicator an investor uses to identify momentum in a stock and confirm a trend or trend reversal. Volume gives an investor an idea of the price action of a security and whether he should buy or sell the security.
Trading volume can also signal when an investor should take profits and sell a security because of low activity. If there is no relationship between the trading volume and the price of a security, this signals weakness in the current trend and a possible reversal. The market capitalization for the company is reported at $128.38B.
Servicesource International Inc (NASDAQ:SREV) inclined 2.00 points or 5.04% at the market, soon after a leading provider of essential residential and commercial services, recently declared its intention to separate its American Home Shield (AHS) business from its Terminix and Franchise Services Group (FSG) businesses, in addition to the appointment of Nikhil Varty as Chief Executive Officer of the Company and as a member of the Board, effective right away.
The stock opened at $41.79. It reached an intraday trading high of $42.94 and now trading at $41.69. The total volume traded for the day is 3.22M, as compared to its average daily volume of 793,333.00 shares. The current EPS for the company has been recorded at $1.14 and the beta value recorded by the company stands at 1.01 points.
The separation of AHS is predictable to result in two publicly traded companies – ServiceMaster and AHS – by means of a spin-off of the AHS business to ServiceMaster shareholders, in a transaction intended to be tax-free. The transaction is predictable to be accomplished in the third quarter of 2018. ServiceMaster will disclose additional information regarding the separation, counting historical financial and capitalization information, in a Form 10 registration statement predictable to be filed with the Securities and Exchange Commission during the next several months.
Both ServiceMaster and AHS remain committed to Memphis, Tennessee, and intend to maintain their headquarters there.
Following completion of the separation, each company’s board and administration team will be able to pursue its distinct strategies, and focus on its own long-term growth and profitability. The separation is predictable to result in raised growth opportunities and greater market clarity for both companies. Additional benefits of the separation include:
- Distinct investment identity – With the separation, shareholders will be able to evaluate and invest in each business with greater clarity based on its individual merits and future prospects.
- Improved planned and administration focus – The dedicated board and administration team of each company will be able to pursue its distinct strategies, and focus on its own long-term growth and profitability.
- More efficient allocation of capital – Each company will concentrate its financial resources solely on its own operations and will have greater flexibility to invest capital in the manner appropriate for its unique strategy and opportunities.
- Independent access to capital markets – Each company will have individual access to the capital markets and more flexibility to capitalize on its individualized growth opportunities. Each company will have its own pure play equity currency to use for corporate development and for administration equity compensation.
Mark Tomkins, Chairman of the ServiceMaster Board of Directors, commented, “Following a careful and thorough review of the business, it’s clear that ServiceMaster’s pest control and home warranty businesses have distinct, separate opportunities for profitable growth. The plan declared recently will allow both ServiceMaster and AHS to leverage their market-leading positions and focus on realizing their respective growth potential. Shareholders of both companies will be able to take part in this upside potential.
“As separate entities, ServiceMaster and AHS will be better able to focus on their unique growth strategies. The transaction will allow ServiceMaster to better implement a capital structure and capital administration strategy appropriate to each business. We believe this transaction is in the best interests of our shareholders and will produce attractive returns and improved long-term value.”
To oversee the separation process and position each of ServiceMaster’s businesses for long-term growth, the Board also named Nikhil Varty as CEO effective right away, replacing Rob Gillette. Mr. Varty is a dynamic leader with extensive experience leading and managing large, complex organizations for high-performing multi-national corporations, counting WABCO Holdings Inc., Honeywell International, Inc. and PricewaterhouseCoopers, over his 30-year career. Under his innovative and results-oriented leadership, Mr. Varty has a proven track record of establishing planned direction, driving revenue growth and profitability and leading companies to achieve operational excellence.
Mr. Tomkins said, “We are also happy to declare the appointment of Nikhil Varty to the role of CEO during this important time for ServiceMaster. With more than three decades of deep operational expertise and planned leadership experience, Nik is exclusively qualified to lead ServiceMaster into the next chapter of its growth story. He has direct experience developing and executing successful global business strategies, in addition to achieving record returns on investments and delivering superior shareholder value on a sustainable basis. With a background in transforming companies through building the right organization, structure and talent, the Board firmly believes that Nik is the right leader to lead ServiceMaster as it looks to execute on the next stage of its growth strategy. The entire Board looks forward to working closely with Nik and continuing on our path to become the number one choice of customers for essential services through empowered people and convenient access.”
“I am very excited to join ServiceMaster and am eager to begin working closely with the Board and administration team to grow and enhance opportunities for our employees, customers and partners,” said Mr. Varty. “I am very supportive of the Company’s decision to separate its businesses and believe that it is the right and necessary step at this point in time. My planned focus will be to deliver superior results, identify levers for growth and develop the right talent, all while aiming to consistently beat expectations. I am committed to executing on the Company’s planned plan and am confident that our talented team will work together to capitalize on existing and future growth opportunities and enhance shareholder value.”
Mr. Tomkins concluded, “We thank Rob for his noteworthy contributions and years of dedicated service to ServiceMaster and Memphis. His leadership has brought ServiceMaster to the point where we can take this transformative step in our company’s history. We wish him all the best in his future endeavors.”
Mr. Gillette is predictable to be available to the Company on a transitional basis and to work with Mr. Varty during his remaining time at the Company in order to ensure a smooth transition.