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For investors willing to bet against the crowd, these dogs could become tomorrow's darlings.
One of our favorite places to look for turnaround candidates is a list of the worst performers in a certain segment of the market. Because investor sentiment can change very rapidly, today’s dogs often become tomorrow’s darlings, and those who are willing to go against the crowd can reap significant profits.
Among the worst performers in the S&P 500 index since the market hit its lows last June are Apple (AAPL), F5 Networks (FFIV), J.C. Penney (JCP) and Monster Beverage (MNST).
To be sure, many of these stocks carry some risk. There are, after all, reasons why they have underperformed. But the market often overreacts to these risks, and if these companies can fix their problems their stockholders will be very handsomely rewarded.
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Caution has clearly been the fool’s way in this market.
You've been an idiot if you've sold almost any stock so far since the start of 2013. You've been a moron if you've been waiting for revenue to pick up before you've bought. You have been a fool if you've feared the Federal Reserve would act imminently.
You've been a total bozo if you've listened to President Obama about the crashing of the economy because of the sequester -- particularly if you've sold the defense names, which have been the best-acting stocks in the book.
In fact, the moves are eerie. It is as if there had been an edict that every stock -- other than gold stocks, a copper or an iron ore stock and maybe a few steels -- that everything has to go higher.
To me this speaks directly to the notion of underinvestment and the supply and demand of equities.
Bulls may be in control, but Wall Street will be watching for any sign of the Fed backing off its bond buying.
It's Monday and the S&P 500 is, again, sitting at an all time high of 1,667.47. CNBC predicted that the bulls will keep control this week, but the market will watch for any sign that Federal Reserve Chairman Ben Bernanke is considering drawing down the central bank's bond buying.
However, some technicians note that the market is looking parabolic as the upward slope of the rally is the steepest it's been since it began.
Early on Monday S&P 500 futures are down slightly to 1,665.07, while the euro/U.S. dollar was up slightly at 1.2864. Also in Europe,German 10-year government bond yields rose 3 basis points to 1.36%, and Italian 10-year government bond yields fell 2 basis point to 3.83%.
While analysts fret it's a one-trick pony, it's still churning out ideas that could pay off long-term. And investors are going along.
All hail the bull market, which ended the week with a big rally. But it also is starting to look a little like 1987, which suffered an epic blow-out.
It's not just that the Dow Jones industrials ($INDU) and the Standard & Poor's 500 Index ($INX) finished the week at record highs. Or that the Nasdaq Composite Index's ($COMPX) finish on Friday was its best since October 2000.
It's just that the gains so far in 2013 have come without any prolonged pullbacks and remarkably few weekly losses.
The Dow has suffered just five weekly losses this year. The S&P 500 and Nasdaq just four. Since the turn of this century, the indexes typically have seen eight to 10 weekly losses by now. That includes even the horrific 2008.
Sales of Apple's smaller tablet may stall, as consumers wait for the next-generation model
By: Louis Bedigian
Is Apple (AAPL) bracing for an iPad Mini sales decline?
Every few weeks, a new report suggests that the answer is "yes."
In March, iPad Mini shipments were expected to decline in preparation for the launch of the next-gen model. Apple cannot sell more units than it ships, so this could feasibly hurt the company's bottom line.
Additional details came to light in April when shipments were rumored to decline by as much as 30% this quarter. Now DigiTimes has reported that one of Apple's suppliers, AU Optronics (AUO), could reduce its panels from four million units to no more than 2.8 million units.
A falling yen and stronger Japanese economy help share prices of the automaker to their highest levels in years.
Toyota Motor (TM) blew through my $120 target price on May 10 and kept going. The New York traded ADRs (American Depositary Receipts) traded at $127.26 just before the close on Friday.
As of Friday, I’m increasing my target price to $151 for the ADR. Toyota Motor is a member of my Jubak’s Picks portfolio. This stock pick is up 28.7% since I added it to the portfolio on February 5, 2013.
I added Toyota Motor to this portfolio as a way to play the decline in the Japanese yen being engineered by the Bank of Japan and the Abe government in Tokyo.
My reason for holding onto this position, and increasing the target price, is my belief that the yen at Friday's close of 103.24 to the dollar isn’t the near the end of the drop in the yen. The consensus on Wall Street is we’re headed through 105 to 110 by the end of the year. I think that’s conservative, and that we’re likely to see 120 or so by the end of 2013.
One of the nation's largest insurers beats profit estimates, helped by a recent acquisition.
By Zacks Equity Research
On Thursday, shares of Prudential Financial, Inc. (PRU) hit a 52-week high of $68.45. The momentum was driven by a strong first quarter, which included a 20.6% positive surprise rating affirmation, and successful closure of the acquisition of life insurance business of The Hartford Financial Services Group Inc. (HIG).
Prudential reported first-quarter 2013 earnings on May 1. Adjusted operating earnings came in at $2.28 per share, higher than the Zacks Consensus Estimate of $1.89. Results also exceeded the year-ago earnings of $1.61 per share.
Prudential reported net loss of $1.55 per share in the first quarter of 2013, which was narrower than the prior-year loss of $2.03.
In this installment of Investor Beat: the social networking site celebrates its one-year anniversary as a public company. What’s next for the internet giant?
One expert argues there are far better ways to get returns right now.
Adrian Day, president of Adrian Day Asset Management, shares his analysis of the bond market with MoneyShow.com's Nancy Zambell, and suggests his preferred strategy for those investors looking for income.
Adrian, the bond market has not done very well of late, and of course the stock market has been absolutely great. If you had to say either or, would you say either-or?
No, I'm not a big fan of bonds right now for any investor, even investors who want income. Typically, people think if you need income you need to go to bonds. I think interest rates can stay lower than most people imagine for a lot longer than people imagine.
Earnings season is winding down but there are still some companies that could pop up when they report next week.
By the staff at Kapitall.com
This list looks at stocks reporting earnings next week that have been the subject of attention from hedge funds and short sellers. Do you think an earnings surprise is in store?
To build this list, we started with a universe of stocks reporting earnings next week (May 20 to 24). We looked for an increase in buying from institutional investors, with significant net institutional purchases over the last quarter representing at least 5% of share float. This indicates that hedge fund managers and mutual fund managers expect the upside.
Next, we looked for some degree of optimism from short sellers, with a decrease in share float month over month of at least 1%. This may not seem like much, but in each case the short floats are significantly high, making them short squeeze candidates if earnings surprise to the upside.
Stocks are higher as University of Michigan consumer confidence reading is better than expected.
The good news is most respondents think the company can regain its mojo.
By Tim Parker
It's hardly what statisticians would consider scientific data but it's telling, nonetheless. The Bloomberg Global Poll is a survey that was conducted with 906 Bloomberg customers on May 14. According to the back story, Bloomberg interviewed the respondents using their Bloomberg terminal.
You've heard of the Bloomberg terminal -- the high dollar subscription service used by banks like JPMorgan (JPM). You've probably also heard of the recent related scandal, where apparently Bloomberg accessed data about its clients' terminal usage.
But let's not digress. According to Bloomberg, 71% of respondents said that Apple (AAPL) had lost its status as the industry leader in all things technology. It wasn't completely negative, though. Only 28% believed that this was permanent while 43% said that Apple was in a temporary soft spot. Another 23% said that Apple remains that best in the technology business.
The burrito chain's 13% revenue increase doesn't offset hemorrhaging same-store sales.
I won't dispute that the company makes the perfect burrito, but the stock has been priced for perfection for some time. Although the execution has been anything but flawless.
With rising costs of beef weighing on Chipotle's margins, alongside weakening same-store sales, it's become hard to stomach the stock price, which carries a price-to-earnings ratio twice that of McDonald's (MCD) and almost double the multiple of Yum Brands (YUM) -- it doesn't make sense. Today, on the heels of the company's first-quarter earnings report, these concerns are even more glaring.
Tesla tries to hold recent gains. Sony to discuss turnaround plan. Campbell Soup, Ross Stores and GameStop to report earnings. Bloomberg consumer confidence index is due.
By Michael Fowlkes, InvestorsObserver
Sony CEO to discuss turnaround plans
What's happening: Sony (SNE) has been one of the market's strongest performers thus far in 2013, gaining 82.6%. Activist investor Daniel Loeb, who has increased his stake in the company to 6.5%, has recently called on the company to spin off its entertainment arm. But the company said it has no intention of doing so. CEO Kazuo Hirai is scheduled to present the company's turnaround plans at the company's strategy meeting Wednesday.
Technical analysis: SNE was recently trading at $20.45, down $1.78 from its 12-month high and $10.88 above its 12-month low. Technical indicators for SNE are bullish and the stock is in a strong upward trend. The stock has support above $16.00. Two analysts cover the stock, both of who give it a "strong buy" rating. The stock receives Standard & Poor's 3 STARS "Hold" ranking.
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The auto parts giant beats Wall Street expectations, while continuing to expand its stores in the U.S. and Mexico.
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[BRIEFING.COM] Stocks ended modestly higher as the S&P 500 climbed 0.2%, and the Dow added 0.4% to register its 19th consecutive Tuesday of gains.
The major averages saw little change during morning action, but afternoon buying interest helped lift the indices to session highs. Most cyclical sectors (with the exception of materials and technology) finished among the leaders, but the defensively-geared health care sector settled atop the leaderboard as biotechnology outperformed. ... More
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