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As the market slides, the iPad maker is looking more attractive, prompting this safety-first researcher to add it to its 5-star-stock list.

By TheStreet Staff Jun 21, 2011 10:29AM

By Jake Lynch, TheStreet

 

Morningstar (MORN), the safety-first investment-research firm, recently added technology darling Apple (AAPL) to its exclusive list of five-star stocks.

 

Morningstar covers more than 1,700 stocks, and only 45 receive five-star rankings. That number has increased quite a bit in the past few weeks as the equity market has slid. Morningstar says Apple, which is down to $315 from a 52-week high of $365, is now at an attractive discount price.

 

During the second quarter, Apple roughly doubled its operating income and boosted sales by 83%. Such growth is remarkable, especially considering the company already has a market value of $290 billion. IPhone revenue surged 126%, Mac revenue climbed 32%, iTunes revenue increased 23%, software sales stretched 17%, and peripherals sales advanced 23%. IPod sales declined 14%. The iPad has no year-over-year comparison, but it delivered $2.3 billion in quarterly sales. Put simply, business is booming.

 

In this market, investors want stocks that pay a reliable yield to cushion the blows of volatility.

By Jim Cramer Jun 21, 2011 9:37AM

jim cramerthe streetWhat separates the winners from the losers in this market? Often it is one simple concept: a viable dividend that is unlikely to be cut. Specifically, a dividend that has a nice yield after taxes, one that will cushion it from the vicissitudes of daily market swings.

 

It's your best defense against forces like a troubled Europe, a tightening China and a sinking Japan.

 

How powerful is it? All you need to do is examine some of the weakest sectors to know. Let's take the case of defense stocks. Here's a group that's being butchered by the Department of Defense. We all know that spending is coming down. But the stocks have been huge winners this year, and much of that, I believe, is yield protection.

 

Lockheed Martin (LMT) has been in the cross hairs of the U.S. government cutbacks for months. Has the stock gone down? It is up an astounding 15% for the year, in large part, I believe, because it yields 3.7% and, of course, throughout that rally had a much higher yield.

 

Callifornia regulators stop automatic delivery of the white pages. Are the Yellow Pages next?

By Kim Peterson Jun 20, 2011 5:35PM
California residents will no longer see residential phone books unceremoniously dumped on their driveways and porches. Regulators there have approved a request by Verizon (VZ) to end the practice.

Verizon will still hand out the Yellow Pages as well as government white pages and business listings. But just cutting the residential listings will save about 1,870 tons of material, reports the Matter Network.

California isn't alone here. Other states are granting similar requests by phone companies, who don't like the books because they're unprofitable and generally advertising-free, USA Today reports. People can pretty much get the information they need on the Internet now. 

There is plenty of political rhetoric surrounding a second rescue package.

By Jim J. Jubak Jun 20, 2011 4:37PM
Jim JubakHope you didn't expect the road to run smoothly. Friday’s press-conference announcement of a compromise on a second rescue package for Greece was interesting, but there will be many bumps on the path to an actual rescue package.

If Friday was a day for Eurozone leaders to show that they weren’t willing to throw Greece and the euro to the wolves of political expediency, the weekend was a time for demonstrating how tough they would be on Greece.

Suddenly, just after German Chancellor Angela Merkel announced that Germany would withdraw its insistence on a mandatory extension of maturities on Greek government debt -- thus clearing the way for a deal acceptable to the European Central Bank and global debt rating companies -- Eurozone politicians started to talk about releasing only part of the funds from Rescue Package No. 1 that Greece needs in July to avoid a default.
 

The share price has fallen below key technical support levels, yet some analysts say now is the time to buy.

By Kim Peterson Jun 20, 2011 2:45PM
Apple (AAPL) has gone from market darling to market dud. Shares have fallen a little more than 10% in the past four months to $314.64. The stock is trading at only 11 times next year's earnings.

Why is Apple struggling? Analysts have a median price target of $450 on the stock, with 50 urging a "strong buy" or "buy." Investors apparently disagree.

Apple is trading well below its 50-day moving average of $338.98 and below its 200-day moving average of $325.91. Its market value has fallen below $300 billion -- back to where it was at the beginning of the year. 

The valuations of these companies argue against it.

By Motley Fool Pick of the Day Jun 20, 2011 2:28PM

By Jordan DiPietro

 

A few weeks ago, a friend asked what I thought about the future of a Facebook IPO. My short response was that retail investors would most likely get in the way after the smart money made its way on to the table, so it was hard to recommend a buy.

 

His response: "Buy, buy, buy!"

 

Here comes another bubble?
When investors start getting so involved in story stocks and ideas that they ignore fundamentals and valuations, it's very easy for a bubble to form.

 

Recently there's been an onslaught of tech companies coming to the market or filing with the Securities and Exchange Commission for upcoming IPOs, and the hype around these companies has become quite phenomenal.

 

From cereal to soda, food marketers are reviving the past to stir shoppers' emotions.

By Kim Peterson Jun 20, 2011 1:14PM
In tough economic times, people want comfort. They long for the past, when life was happier. And they'll buy products that remind them of those days.

That's the hope of food companies, at least. Companies such as Pepsi (PEP) and General Mills (GIS) have jumped on the retro food bandwagon, dusting off old designs in an effort to take shoppers down memory lane.

Check out the following video for good examples of how everything old is new again on supermarket shelves. For some products, this trend is becoming a permanent look.

Post continues below: 

Companies and the economy are healthy, and at least one fund manager says the market is way oversold.

By TheStreet Staff Jun 20, 2011 11:22AM

Image: Arrow Up (© Stockbyte/SuperStock)By Frank Byrt, TheStreet

 

It's easy for investors to think the sky is falling, given the drumbeat of dour economic news in recent weeks.

 

But those fears, which have resulted in a 7% tumble in the S&P 500 Index ($INX) over the past six weeks, may be overblown, several money managers say.

 

That's because much of the bad economic news has already been factored in to stock prices. Meanwhile, U.S. corporations' fundamentals remain solid after a 19.4% jump in S&P 500 earnings in the first quarter. Besides, investors have few places to go other than equities as fixed-income returns dwindle.

 

That sounds like a value-oriented, stock-pickers' paradise. So why the Chicken Little reactions?

 

These classes have badly lagged the broad market this year, and their relative performance predicts more underperformance may lie ahead.

By MoneyShow.com Jun 20, 2011 11:08AM
By Tom Aspray, MoneyShow.com

It has been a dismal month for stocks, and even with last Friday’s bounce, the S&P 500 is still down 5.5% for June. Last week, I looked at several of the industry groups, including utilities and restaurants, that were outperforming the S&P 500, but of course there are also those industry groups that have done worse.

Clearly, we would like to stay invested in the strongest sectors and stocks, but equally important is doing your best to avoid the weakest areas of the market. You can do this in a superficial manner by comparing your stock or ETF's performance to that of a major average like the S&P 500, or an ETF like the Spyder Trust (SPY), which tracks it. 

Don’t get too concerned about day-to-day divergences, but when your stock or ETF is weaker for a week or two, it should be more of a concern.

Over the past three months, there are four industry groups that are down 11.7%-17.6% when compared with the 5.8% decline in SPY, and the poor performance for several of these groups might come as a surprise.

By looking at these underperforming industry groups, we can determine whether any are ready to turn around and hopefully gain some insight on how to avoid the weakest areas of the market.
 

Why all the gloom and doom? US businesses are enjoying massive profit margins and robust sales.

By TheStreet Staff Jun 20, 2011 11:02AM

Image: Arrow Down (© Image Source/SuperStock)By Chris Stuart, TheStreet

 

The world is ending, so run for the hills, buy gold and stash your money under the mattress. We are headed for a financial apocalypse.

 

That's what headlines from the past couple of weeks are saying. For example:

 

 "Shiller Sees 'Substantial' Probability of Recession"

 

"Nearly Half in US Think New Recession Is Coming"

 

 "We're on the Verge of a Great, Great Depression"

 

What's everyone so worried about? Jobs, housing, consumer confidence, Greece -- the list goes on. But the pundits are ignoring one big fact: Corporate America is alive and well.

 

Keep an eye on funds tracking transportation, the Swiss franc, emerging markets and technology.

By TheStreet Staff Jun 20, 2011 10:36AM

By Don Dion, TheStreet

 

Here are five ETFs to watch this week.

 

1. iShares Dow Jones Transportation Average Index Fund (IYT)

 

Transportation will be in focus as FedEx (FDX) reports earnings Wednesday. FedEx is listed as IYT's second-largest holding, representing close to 10% of the fund's index.

 

Many investors turn to FedEx's reports for a read on the global economy. A strong report and outlook would indicate that consumers and businesses are becoming more confident.

 

Investors are way too skittish. Stay long this week

By Jamie Dlugosch Jun 20, 2011 9:57AM

It was not easy by any means, but the market managed to finish last week with a gain. The fractional increase in value ended a six-week losing streak.

 

The gains were a bit of a mirage.

 

The major indexes may have closed higher, but many stocks traded lower. Technology stocks in particular were hit hard. Losses in that very important industry suggest that investors are still skeptical about the economy and future corporate profits.

 

Much of the weakness can be attributed to worries about the debt crisis in Greece. There is very real fear that a default will create a chain-reaction collapse in global finances. Until that fear subsides, stocks will struggle.

 

I will never sell stocks based on fear. As such, the ETF to buy this week is the iShares S&P North America Technology and Multimedia Fund (IGN).

 

The charts are signaling that the only way to go from here may be down. Oil shares are the most vulnerable.

By Jim Cramer Jun 20, 2011 9:03AM

jim cramerthe street Sometimes you just have to own how really bad this market is. When I went through the S&P 500 ($INX) charts this morning with an eye toward the collapse of Greece and the new battleground of Italy that's developing, I couldn't help but notice two things:

 

1. Only McDonald's (MCD) and Johnson & Johnson (JNJ) had buyable charts of all the charts in the whole chart book.

 

2. The charts are screaming that we are headed into a second recession that's going to be a real doozy.

 

I want to write from the outset that I don't see things that way. I see many companies reiterating strength, and I see many companies that haven't seen strength about to get some, notably the companies that buy commodities.

 

But the stocks are signaling total calamity, and it is important to know that.

 

Sanford Bernstein downgrades Research In Motion. GE reaches a labor agreement. Boeing gets a 6-jet order from Qatar Airways.

By TheStreet Staff Jun 20, 2011 8:02AM

TheStreetBy Andrea Tse, TheStreet

 

Updated at 9:20 a.m. ET

 

Here are stocks that might be active in regular trading Monday.

 

BlackBerry maker Research In Motion (RIMM) has been cut to "underperform" from "market perform" by Sanford Bernstein. Shares were falling 1.8% to $27.25.

 

Conglomerate General Electric (GE) and its two largest unions have reached a tentative four-year labor deal that affects more than 15,000 GE workers. GE shares were down 0.7% to $18.37.


Qatar Airways said it will order six Boeing (BA) 777 jets, with a total value of $1.7 billion. Boeing heads into the Paris Air Show on Monday with more orders this year than rival Airbus.

 

Indicators are mixed, and events next week could tip the scales to the bears or bulls, but sideways trading in the short term seems likely to be followed by a solid rebound.

By MoneyShow.com Jun 17, 2011 7:44PM
By Tom Aspray, MoneyShow.com

The six-week decline in the US stock market is over, at least for now. Though Friday’s rally gave bulls some hope, on the back of better than expected LEI numbers, it was not enough to change the prevailing bearish outlook for the stock market.

With speculators and many pros still on the short side of the market, and the regular investor either out or very nervous, how much higher can stocks bounce?

Both US and European markets were encouraged by Friday’s press conference from German Chancellor Angela Merkel and French President Nicolas Sarkozy. Their apparent agreement to work with the ECB on a solution for Greece’s debt problem helped calm the markets.

Standard & Poor's downgrade of Greece’s debt early in the week, not to mention the widely televised riots in that nation, had made the markets even more nervous. The plunging euro at mid-week also did not help, as reports circulated that hedge funds were making big bets on a Euro collapse.

On the Asian front, the latest news on the Chinese economy was not encouraging, as its consumer price index for May rose 5.4% from a year ago. Industrial production was positive, suggesting the economy was still growing.
 

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