Top Stocks

Time to make a few stock buys. At least, if history is a guide.

Sept. 30 in a midterm election year is generally the market's low point of a presidential election cycle, Eddy Elfenbein writes. It's the best day to buy stocks, he adds.

Elfenbein looked at the numbers over the entire history of the Dow and found that the Dow generally gains about 24% in the one-year period starting Sept. 30 of the midterm election year.

If the numbers hold true, that means the Dow could see a 24% rise from today through Sept. 6, 2011. 

By Ted Reed, TheStreet

 

Boeing (BA) investors didn't appear too concerned about a newly announced delay in the delivery of its 747 freighter Thursday.

 

In early afternoon trading Thursday, Boeing stock was up 1.3% to $66.85 despite the news. The shares opened the year at $55.72 and have gained about 25% year to date. Boeing remains the third-best-performing stock in the Dow average, behind Caterpillar (CAT) and DuPont (DD).

 

Boeing said Thursday the first delivery of the 747 cargo aircraft is now expected in mid-2011.

 

If your business relies on FedEx for shipping its products, this might not come as the best news. FedEx (FDX) announced Wednesday that it will raise prices by an average of 3.9% starting Jan. 3. 

 

The world's largest air-cargo carrier says the hike is an attempt to compensate for the rising cost of fuel. FedEx apparently spent $887 million on fuel last year, an increase of 33% over the year before.

 

By Jim Cramer, TheStreet

 

Why can't they just release all the bad news at once over in Europe? This morning I watched a pained Irish finance minister talk tough about the Irish bank bailout that will take years for the country to recover from. This was a long, drawn-out process that we all knew had to take place, all except the poor uninformed individuals who were still allowed to buy the common stocks of the Irish banks, even after it was obvious they were going to be diluted to death.

 

A tough-talking Brian Lenihan laid out plans for a $68 billion bailout that will include a cash induction for Anglo Irish and a majority control of Allied Irish (AIB), a stock that people have asked me about repeatedly because it "looks so cheap."

 

At the same time, Moody's cut Spain's bond ratings because of the large deficit in that country -- rocked again by a property bubble gone bad and overspending by the government -- and the gloom proceeds unabated.

 

There's no doubt that American Tower (AMT) is getting kind of pricey -- even after it beat Wall Street expectations for second-quarter earnings.  

On Aug. 3, the company reported second-quarter earnings of 25 cents a share, 5 cents a share above Wall Street's projections. Revenue climbed by 11% from the second quarter of 2009, coming in at $469.9 million -- about 1% ahead of expectations. 

But the key metric for American Tower is price-to-cash flow. The company takes its cash flow and uses it to buy more cell-phone towers (or to buy complete cell-phone tower competitors). That in turn produces more cash flow, which American Tower uses to buy more towers.

 

The battle between Google (GOOG) and Skype just ratcheted up a notch with Facebook's entry into the fray.

Recall that Google recently launched voice calling from Gmail, allowing (through the end of the year, at least) people to make free calls from their Gmail page. I've been using that feature daily to make free long-distance calls from my computer.

Some thought the new service was the death knell for online calling service Skype. But Skype showed Wednesday that it's very much in the game with an alliance with Facebook (also known as Google enemy No. 1). 

Defying expectations of a typical September selloff, stocks have instead pieced together a historic rally -- which was what I expected back on September 1. For the month to date, the S&P 500 is up 9.2%. That's the best performance for the month of September since 1939. Since 1928, Septembers have on average posted a loss of 1.2%.

 

In fact, using market price information going all the way back to the late 1700s thanks to the work of Global Financial Data, the past month has been second best September in the history of the American stock market. Runners up in include the 8.3% gain in 1954 and the 8.1% gain in 1891.

 

But now, after a historic run, there is evidence that a pullback is increasingly likely. Stocks, represented by the S&P 500 ($SPX), have hit solid resistance from January's highs near 1,150. Breadth continues to narrow as demand fades. Here's what you need to know.

 

Quit whining about the economy. You're not making any money from your savings, so start spending!

That's the message from one Bank of England official, according to the Telegraph.

Charles Bean, the deputy governor, said that older people should not expect to live off the interest from their savings accounts. The savings interest rate has dropped to about 0.23%, causing problems for the 5 million or so retirees who try to survive on interest payments, the Telegraph reports. 

I've added Costco Wholesale Corp (COST) to my New High portfolio. The company operates membership warehouses based on the concept that offering members very low prices on a limited selection of nationally branded and selected private-label products in a wide range of merchandise categories will produce high sales volumes and rapid inventory turnover.

Rapid inventory turnover enables Costco to operate profitably at significantly lower gross margins than traditional wholesalers, discount retailers and supermarkets. 

Shares of Green Mountain Coffee Roasters (GMCR) were down about 17% in midday trading as investors reeled from an after-hours disclosure Tuesday night.

Buried at the bottom of an 8-K regulatory filing, Green Mountain delivered some bad news: The U.S. Securities and Exchange Commission is investigating the company and has requested documents.

The SEC isn't saying much, but based on the request, Green Mountain thinks "certain revenue recognition practices" are the focus. Also in question is the company's relationship with one of its vendors. 

Consumers in Thailand craving the signature taste of a hot, fresh Krispy Kreme (KKD) glazed doughnut will no longer have to suffer. The sweets shop announced today that it will open its first store in Thailand, in the center of Bangkok's business district. Company officials expect to open approximately 20 stores in Thailand over the next five years. 

 

The Thailand opening is part of a larger expansion, as just last month the company announced the construction of stores in the Dominican Republic. Krispy Kreme now offers its products in 22 countries and is showing signs of growth after a very steep and very public flop a few years ago.

 

By Jim Cramer, TheStreet

 

The semiconductor group had been among the most hated in the market. I know it, not just because of the myriad downgrades and give-ups but because when I go on Twitter to read responses to my posts and the articles I write, I see the criticism, including lots of people claiming you can't buy these stocks in September.

 

Of course it was tough to be more wrong than that. The Semiconductor HOLDRS (SMH) went from $24.20 to $27.60 in that period, and the Philadelphia Semiconductor Index (SOX) rallied from 307 to 347. Just a huge and bountiful takeoff. Of course I received a huge round of apologies for the flaming I took. Oh, wait, no, I didn't; that almost never ever happens. Particularly with many of the Web cretin critics.

 

But you have to marvel at all of the people who gave up on Intel (INTC) at $17-$18 or hated Texas Instruments (TXN) at $25 before this juicy breakout and pooh-poohed Altera (ALTR) as a company with no momentum or said that Nvidia (NVDA) would never get past 10. TriQuint (TQNT) and RF Micro (RFMD) were left for dead, roadkill, and now they are doing cartwheels.

 

Some of Starbucks' (SBUX) key ingredients -- coffee, milk, chocolate and sugar -- are becoming more expensive worldwide, and that's taking a toll on the company's bottom line.

Arabica bean prices have risen steadily for the past two years and recently reached 13-year highs. Those are the milder beans favored by Starbucks and Green Mountain Coffee Roasters (GMCR) (see this chart for more).

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The cost increases are so high that Starbucks said it can no longer absorb them. "The extreme nature of the cost increases has made it untenable for us to continue," the company said. As a result, Starbucks is raising the prices of its bigger and more complicated drinks.

 

It's increasingly hard to figure out how much risk there is in owning shares of Ormat Technologies (ORA).  

There's no doubt in my mind that the company is the best global pure play on the expansion of power production from geothermal sources. But how much potential return do I need to see before the risks in that pure play are worth taking? Especially since the risks in the stock keep rising.

 

Government price subsidies and financing programs for geothermal power are shakier than they were a year ago (and they were pretty shaky back then, too). The financial markets haven't become much more forgiving for projects like these.

 

The PlayBook. Sounds fun, right?

It's a handheld tablet computer -- hence the "book" part of the name -- but you get to play on it, maybe? But here's the confusing part: The PlayBook is being developed by Research in Motion (RIMM).

RIM makes the BlackBerry line, and is focused with laserlike precision on business productivity. It's calling the PlayBook "the first professional tablet," although the name says it's anything but.