There are some picks in this sector that have excellent valuations and strong earnings growth.
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Amazon's tablet made a splashy entrance and even managed to eat into the iPad's wide lead. But could the e-tail giant do the same with a smartphone?
First came the Kindle Fire. Now Amazon (AMZN) is reportedly working with manufacturer Foxconn to develop its own smartphone, which would presumably take a cue from the Seattle-based e-tailer's popular line of Kindle tablets. The move is seen as Amazon's attempt to upset Apple (AAPL) and Google's (GOOG) goals in the digital content market by locking consumers into its robust catalog of e-books, movies, and mp3s -- even though the phone will likely run on something similar to the already-established Android platform.
But while the low-cost Kindle Fire was a rousing success, critics say that building a smartphone is an entirely different kind of beast, and Amazon would be wise to stay away.
Allegiant Travel is upgraded to 'buy,' and Dendreon is downgraded to 'underperform.'
Wednesday's noteworthy upgrades include:
Coca-Cola will be the first blue chip since 2005 to divide its shares. What are splits, and why should investors care?
It's stupid. If you own 10 shares at $40, or one share at $400, it's the same thing! You just need to know how to divide.
In light of his oft-cited quotation above, it was more than a little ironic to see Google's (GOOG) co-founder recently reverse himself and back the search giant's first stock split since it went public eight years ago. Page had nothing to say regarding his about-face, having conveniently lost his voice for the occasion, but the de facto 2-for-1 split was especially contentious, as it effectively consolidated his power, involving as it did the creation of a Class C stock that is devoid of voting rights.
Page is not the only high-profile investor to speak out on stock splits. None other than Warren Buffett rhetorically asked shareholders in a 1983 letter: "Could we really improve our . . . group by trading some present clear-thinking members for impressionable new ones who, preferring paper to value, feel wealthier with nine $10 bills than with one $100 bill?"
One of the stronger long-term stocks has sharply lowered its guidance, which means we could see a rash of it over the next few weeks.
By Jim Jubak, MoneyShow.com
This is what I'm afraid second-quarter earnings season is going to look like for even the best of companies: On Tuesday, Cummins (CMI) lowered its guidance for second-quarter revenue to $4.45 billion. The Wall Street consensus was $5.07 billion in revenue before the announcement.
For the full 2012 year, the company said it now expects that revenue will be flat with 2011. The company had hung tough until today, saying previously that it expected revenue to grow 10% in 2012 from last year.
The move is a big bet that states will allow for Medicaid expansion.
When news broke on Monday that WellPoint (WLP) would buy the Medicaid-focused insurer Amerigroup (AGP) for $4.9 billion, the deal sent shock waves through the health care industry -- and AGP shares rose 38%.
By acquiring AGP at the premium price of $92 a share, WellPoint (whose shares rose about 3% on the news) is going all-in on the government-sponsored managed care market.
If a stock is up 500% in a straight line, that's a clue.
I stumbled onto a cult of true believers these last few days, not unlike the cult behind Dendreon (DNDN), the last hornet's nest I tried to navigate, and I think the consequences will be similar for both the hornets and me.
I'm talking about Arena Pharmaceuticals (ARNA), the company that has the first new diet pill approval in more than a decade.
The manufacturer of permanent birth control system announced its next-generation procedure.
By Zacks Equity Research
Conceptus (CPTS), the manufacturer of permanent birth control system, Essure, recently announced a 60-patient clinical trial with its next-generation Essure procedure. Patient enrollment for the clinical trial has just begun in the company's two medical centers in Canada and Mexico.
The existing Essure procedure does not immediately provide permanent birth control. It instead requires the patient to wait for a period of 90 days, during which the body grows over the inserted device, thus forming a barrier that prevents the entry of sperm. Therefore, during this 90-day period there is a need to use some other form of contraceptive.
UBS initiates the iPhone maker with a 'buy,' and the bank is reportedly planning to reclaim stock compensation from executives involved in the trading scandal.
By Michael Baron, TheStreet.com
UBS initiated coverage of Apple with a "buy" rating and a 12-month price target of $740, saying it sees the release of the iPhone 5 as another positive catalyst for the stock, which it views as being reasonably priced.
"Apple is creating a tech empire that likely has not reached its zenith," the firm said. "Our Wave Principle teaches that empires don't last. We recommend the stock, however, because the relatively low valuation seems to discount a too-pessimistic future given moderate smartphone and tablet penetration as well as potential new products."
Behind the usual public relations waffle there are real benefits for both partners.
"Strategic alliances" in business often come to nothing more than a few dutiful emails floating between office cubicles. This is especially true when no cash changes hands, or when they're created to put an end to a legal dispute that one side didn't want and the other regrets.
Analysts aren't expecting much. Even so, one company is going to make the numbers appear much better than they really are.
A measly 5.7%. That's all the earnings growth we're likely to see for the just-ended second quarter of 2012, according to calculations by Thomson Reuters analyst Greg Harrison, based on analysts' predictions for companies in the S&P 500 index. After nearly three years of double-digit gains in earnings, 2012 is shaping up as a year of not only economic anxiety and market volatility, but also underwhelming profits.
Even worse, that expected 5.7% increase probably overstates the real gains we'll see as the second-quarter earnings season gets underway.
HCP, Genuine Parts and Bemis offer good, consistent paydays.
By Jeff Reeves
Dividend investing is all about stability. After all, what good is a 10% yield if the dividend is slashed next quarter and the share price falls off a cliff? If you're truly an income-oriented investor, capital preservation and reduced risk are almost as important as the regular paychecks you get from your investments.
That's why dividend investors flock to stalwarts like Coca-Cola (KO), which yields a nice 2.6% and has a bulletproof brand. Or Exxon Mobil (XOM), which has paid dividends since 1882, back in its days as part of Standard Oil. But if you're looking for stability and yield, you don't have to be locked into crowded trades with the rest of the dividend crowd. There are some smaller, low-profile companies with big yields and a great record of dividends that could be worth a look right now.
Other automakers will no doubt come up with similar programs.
Zacks raises the long-term recommendation for the footwear company from 'neutral' to 'outperform.'
By Zacks Equity Research
Skechers USA (SKX), the California shoe manufacturer, has shown through its distribution networks, subsidiaries and joint ventures, that it's poised to enhance its global reach in the footwear market.
In addition, the company recently posted better-than expected first-quarter 2012 results. As a result, we have upgraded our recommendation on the stock to "outperform" from "neutral."
Stocks are mixed as optimism about a plan to help Spain's banks is tempered by profit warnings from tech companies.
Alcoa (AA) kicked off earnings season with a report of better-than-expected revenues and predicted a global aluminum supply deficit this year. However, on a down note, AMD (AMD) and Applied Materials (AMAT) both lowered their outlooks.
Intel (INTC) made a $4.1 billion investment in chip maker ASML Holding (ASML) and will take up to a 15% stake in the company. Shares of ASML rose 9% on the heels of the announcement, though Intel shares slumped about 1.75% as it was weighed on by AMD's warning.
The new mobile application will scan supermarket shelves to find products that meet a user's criteria.
The research lab has announced an augmented-reality smartphone application that helps users identify products based on personal criteria, such as dietary requirements, pricing, or packaging information. It can also be used to identify sales and special promotions of products.
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The stock rises 9% after the company reveals strong second-quarter results.
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