Top Stocks

 

As the market has continued to rally, one of the big bearish arguments has been that stocks have come too far, too fast. But have they?

 

Not according to Barry Ritholtz, who called both the '08 crash and the '09 recovery. In fact, Ritholtz says this rally is in line with typical secular bear market recoveries. Historically, the median secular bear has lasted about 29 months, and involved a 56% drop — just about what we hit in the recent bear, though much more quickly, he tells Forbes.com. Then, on average, a 70% rebound has followed over the next 17 months.

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“Since we fell much quicker than that, it’s not a surprise that we have bounced 60%, 65% in just 12 months,” Ritholtz says. He thinks a decent sized correction could be "a quarter or three" away, but as long as interest rates stay low, he says it's unwise to short stocks.

 

Ritholtz isn't the only top strategist seeing more room for the market to run.

 

 

The world's largest retailer, Wal-Mart Stores (WMT), will cut prices on as many as 10,000 food and general merchandise items in an effort to reverse its slowing U.S. sales growth. The new pricing has already begun in the company's 3,700 U.S. stores.

Wal-Mart was generally believed to be the company that benefited most from the economic downturn, attracting new customers from a suddenly less-wealthy middle class. The recovering economy has boosted sales at most other retailers. Direct WMT competitors Target (TGT) and Costco (COST) both reported a 10% jump in same-store sales in March.

• Amazon Kindle on Sale at Target? Don't Hold Your Breath

Wal-Mart no longer issues monthly sales figures, but it's no secret that U.S. sales are slowing down and part of the reason is that those recently won-over middle-class customers are returning to their previous favorites.

 

With the global economy in solid recovery mode -- for example, the U.S. economy will grow at 2.4% in the first quarter of 2010, and 2.3% in the second quarter (not great, but a long way from recession), according to the Organization for Economic Cooperation and Development -- I think it's time to reach a little further for yield. (For more on where we are in the economic cycle, see this recent post.)

Navios Maritime Partners (NMM) is a cyclical stock subject to huge ups and downs with the ebb and flow in global demand for commodities such as iron ore, coal, and grain.

But it looks like we're now in the flow part of the cycle.

 

It doesn't help make your investment case when one of the most ruthless and powerful tech companies in the world is after you.

But that seems to be what's happening with Adobe Systems (ADBE), which is certainly feeling the heat of Apple's (AAPL) wrath. Things are now so bad, in fact, that Adobe had to warn investors about it in a regulatory filing.

"To the extent new releases of operating systems or other third-party products, platforms or devices, such as the Apple iPhone or iPad, make it more difficult for our products to perform, and our customers are persuaded to use alternative technologies, our business could be harmed," Adobe said Friday in the filing.

Translation? Apple is gunning for us. And it's scary. 

Two key events took place this week in the housing sector. First, the 30-year fixed mortgage rate moved to 5.21% -- the highest level in eight months.

And that took its toll on homebuilder stocks, which had been on a roll in the last few months. The S&P 500 Homebuilder group broke below its 50-day moving average, the Bespoke Investment Group reported. You can see the ups and downs of the week on the SPDR S&P Homebuilders ETF (XHB).

The rising mortgage rates could crater the fragile recovery that we're just starting to see in the housing market. 

By Eric Rosenbaum, TheStreet

 

Berkshire Hathaway (BRK.B) shares have fallen 2% this week, closing below $80 on Wednesday for the first time since February. But that wasn't the bad news for Warren Buffett’s investment company.

 

This week, a former employee sued Berkshire Hathaway executives, claiming they fired him after he exposed alleged fraud at the company’s recreational vehicle subsidiary, Forest River. The ex-worker, Brad Mart, filed the complaint in US District Court in South Bend, Ind.

 

A recent Harris Interactive (HPOL) poll said Berkshire Hathaway had the best reputation among 60 major U.S. companies. Mart’s complaint alleges that Forest River Chief Executive Peter Liegl forced the company -- which makes RVs, restroom trailers and pontoon boats -- to buy parts at inflated prices from another company Liegl owned. Mart also accused Forest River executives of using shady accounting to hide payments made to former employees.

 

By Lauren Tara LaCapra, TheStreet

 

The performance of big banks in the first quarter will depend on whether they boosted profits in booming areas or stitched up wounds in still-troubled ones.

 

Capital markets continued to improve last quarter. Wealth management, stock and bond issuance, advisory services and proprietary trading businesses are likely to have grown during the first quarter. Net interest margins probably expanded as credit costs eased.

 

On the downside, lending is weak and new regulation has curtailed fee revenue from sources such as overdrafts, credit cards and deposits. It's unclear how mortgage modification programs are faring with charge-off and foreclosure rates still high. It's also difficult to tell whether fees from strong refinancing volume and new home purchases will be enough to counter those losses. Banks that took advantage of shifting interest rates early with smart hedging strategies may have offset housing losses entirely.

 

By Jim Cramer, TheStreet

 

I don't care if Apple (AAPL) sells out the iPad at its own stores. I don't care if Best Buy (BBY) sells out the iPad, as we learned today.

 

I care if Glen Tullman buys the iPad, because if he does, then I know Apple will have created its biggest product ever.

Who is Glen Tullman? He is the chief executive of Allscripts-Misys Healthcare Solutions (MDRX), the leading maker of software to control costs for doctors and hospitals in the United States.

 

Dividend stocks have lots of appealing factors, and it’s easy to find reasons to buy. Some stocks have a great dividend yield. Others have a decades-long history of raising dividends once a year. Then there are picks with a modest dividend but great upside potential for shares.

 

If you’re looking for a reason to buy dividend stocks, there are plenty. But a trickier scenario is knowing when to get out. Here are some tips to help you pull the trigger:

 

Written by Douglas Estadt

Orient Paper sells fine writing paper, corrugated paper for boxes (playing into our “selling picks and axes” them again) and they recently started production of paper for digital photographs. We are long China and one of our friends Dr. Eric Jackson, just visited China a couple weeks ago and met with the management team of ONP and came away very impressed with them and their prospects for continued growth, especially in their new area in digital photography paper.

Today Dr. Eric Jackson, of Ironfire Capital LLC, is sharing with us why it’s one of his top China picks.

• Orient Paper has 2 plants, operating at three-shifts-a-day capacity, churning out its paper products.

• Only three to five China-based companies are producing digital photography paper and ONP gets 30%-plus margins, versus its 20%-plus margins on its other businesses.

• Zhenyong Liu, CEO, founded company in 1996 and still owns 35%. We like CEO /Founders and also high insider ownership.

For more with Dr. Eric Jackson, view the video below

 

I'm adding more gold to the Jubak's Picks portfolio Thursday.

After a rally off the Feb. 8 low on hopes that the global economic recovery was gaining steam, I think we're due for a swing back to fear on disappointing growth numbers from the European Union, on stubbornly high (and perhaps rising) unemployment figures from the U.S., as more discouraged workers rejoin the ranks of those actively looking for work, and on worrying growth and inflation data from China. (For more on these macro trends, see this post and this one).

The technical charts of many individual gold stocks and the Market Vectors Gold Miners ETF (GDX) now show that gold mining shares have cleared recent resistance and look like they're headed higher -- for a while, anyway. 

 

By Scott Moritz, TheStreet

 

Apple (AAPL) chief executive Steve Jobs kicked off Thursday's iPhone show with a few round numbers: 450,000 iPads sold, 600,000 iBooks downloaded and 4 billion applications downloaded to date.

 

On Monday, Apple it sold 300,000 iPads on the first day they hit the market. The company has sold 150,000 more iPads since. The iPad sales numbers, while solid, fall short of some of the most aggressive forecasts for the new device.

 

According to bloggers covering the event, Jobs emphasized the joy the device seems to bring people who buy it, flashing pictures of a girl gleefully opening an iPad box.

 

Nike (NKE) sat tight while the Tiger Woods spectacle unfolded, offering only vague statements of support as mistress after mistress came forward with sordid allegations of infidelity.

Now, after months of near silence, the company has unveiled a new commercial starring the golfer. And the reaction to the spot (included below) seems to be mostly negative.

Tiger doesn't say a word in the advertisement. He doesn't do much, either, except look soulfully at the camera. In the background is the voice of his late father, whose comments are supposed to have more weight, presumably, in light of all the scandals. 

The tech blog rumor mill is running at full speed today about a partnership between online retail powerhouse Amazon (AMZN) and brick-and-mortar discounter Target (TGT). Supposedly, Amazon's hit Kindle e-reader will be on sale in Target stores later this month.

 

Engadget kicked off the frenzy with what looks to be a covert screenshot of Target’s inventory computer. Target is being conspicuously closed-mouth on the subject, deflecting requests for comments with a simple vanilla statement: “Target has no specific plans to share at this time, and we don’t comment on speculation or rumors.”

 

But let’s play devil’s advocate and assume the partnership is in the works.