Top Stocks

Jeff Reeves, editor of InvestorPlace.com

Bank of America (BAC) reported earnings before the bell today that weren't exactly earnings at all. The company tallied a loss of $1.6 billion in the fourth quarter of 2010 as bad mortgages continued to eat away at profits. The shortfall equaled a negative 16 cents a share, and the stock's revenue rolled back to $22.4 billion from $25.1 in the same quarter of the previous year.

The news is certainly disappointing -- and not just to me personally, since I own Bank of America stock. These earnings are the latest bad report this week from a financial sector that seemed on the mend but now doesn't look so hot.

But there are still big reasons to be optimistic.

 

Patricia Russo added to the Hewlett-Packard (HPQ) board? Well, for heaven's sake, why not just add Carly Fiorina, too, while we're at it. Is this company unimpressive or what?

It seems to me that Hewlett-Packard is shuffling deck chairs on the Titanic, trying to get the new guy, Leo Apotheker, a more agreeable team to work with. Either that or there is yet another back story that this once-pristine paragon of corporate governance just isn't telling anyone.

It's not the only thing that's difficult to fathom. Like what happened at Google (GOOG), where Eric Schmidt did such a terrific job as CEO before stepping aside to let Larry Page run the joint. Hey, Page founded it, he can run it for certain. I just hope Schmidt stays around to help do the job, unless, perhaps, he's moving to Washington, where he would be a fabulous addition to the Obama team.

 

By Scott Moritz, TheStreet

 

Google (GOOG) is breaking up the band.

 

The company says its unique and somewhat clunky executive triad will be streamlined in April. According to the plan, CEO Eric Schmidt will be replaced by Google co-founder Larry Page.

 

Schmidt, who was long thought of as the seasoned hand and management talent at the search giant, will take the executive chairman title.

 

The restructuring also includes the departure of Sergey Brin from the management team. Brin's new role will be far less central to Google's core operations and he will have the title of "co-founder."

 

 

Am I the only one who is having butterflies about the solar industry? Is there a market for this resource, or is it all just smoke and mirrors?

Using Barchart, I found 4 solar stocks that on average are up over 20% in the last month alone. The brokerages have fantastic projections and there is very high investor sentiment, but my intuition is holding me back from making a recommendation.  Here's what others think. Let me hear your opinions.

 

Jinko Solar (JKS)

• Barchart Trend Spotter technical buy signal
• 9 new highs and up 29.13% in the last month
• Relative Strength Index 64.33% and rising
• Trades around 28.16 with a 50 day moving average of 24.63
• Wall Street brokerages have 4 buy, 1 hold and 2 under perform recommendations
• Revenue projected to increase 177.40% this year and 43.10% next year
• EPS estimated to increase 1,302.30 this year and increase annually 15.00% for at least 5 years
• Motley Fool CAPS members vote 75 to 22 and All Stars vote 14 to 8 that the stock will beat the market

 

If you have piles of cash and want to buy a beloved but struggling fast-food chain, this is your week. First, Long John Silver's and A&W went up for sale. Now we're learning that Arby's might be available as well.

Wendy's/Arby's Group (WEN) plans to put the Arby's chain up for sale, The Wall Street Journal reported. Arby's doesn't have the two things it takes to succeed as a fast-food chain these days: The ability to expand overseas or steal business from the competition.

The company now wants to focus entirely on Wendy's. "The reality is that the Wendy's brand, given its relative size and scope, is the key driver of shareholder return," said Wendy's/Arby's chairman Nelson Peltz in a statement to the Journal.

Shares of the company soared Thursday on the news, rising by more than 8% to $4.85. 

By Gary Gordon, TheStreet

 

Goldman Sachs (GS) reported weak revenue, Citigroup (C) missed profit forecasts and Wells Fargo (WFC) merely matched estimates. In truth, JPMorgan Chase (JPM) is the only major financial institution that has reported inspirational numbers, but even "J.P." has problems in its mortgage division.

 

Herein lies an ongoing dilemma. You can improve your balance sheet by offloading troubled assets and/or writing off low-quality loans. You can ensure a measure of profitability by limiting your employee overhead, maintaining double-digit credit card rates, having some success in trading volume and/or offering next-to-zero savings rates to depositors. Yet financial stocks will still see "fits" without a more potent level of lending to small businesses and individuals.

 

Lately, many readers have been devouring rapturous reports on the incredible prospects for the financial sector. Hypothetically, economic expansion should encourage greater demand on the part of consumers and businesses alike.

 

Is Netflix (NFLX) trying to phase out the DVD? That's what some customers are saying after the company sent out a short message this week on the company blog.

Netflix is removing the "Add to DVD queue" option for people who use Xbox 360s and other devices that stream Netflix videos. Those users must now go directly to Netflix's website to add movies to the DVD queue (you can still add to the "instant" queue from anywhere).

Talk about inconvenient. The move has ignited a firestorm of resentment among users, and the blog post has received 4,500 mostly negative comments. Why would Netflix do this? The explanation is, well, a little bit murky.

"We're doing this so we can concentrate on offering you the titles that are available to watch instantly," the company says on its blog. 

By Don Dion, TheStreet

 

Rising commodity prices have been the talk of the Street for weeks, leading investors to seek out new and promising ways to gain access to wheat, coal, copper and other hard assets.

 

Energy, in particular, has gained a great deal of investor interest as improving economic conditions around the globe help lift crude prices back toward $100. This week, looking ahead to the new year, the International Energy Agency offered a promising outlook, raising its 2011 global oil demand forecast.

 

Targeting oil and other facets of the energy sector has become a simple endeavor, thanks to the advent of exchange-traded funds. Using products such as the United States Oil Fund (USO) or the iShares Dow Jones U.S. Oil Equipment & Services Index Fund (IEZ), investors can directly capture the price action of this fuel source through futures contracts, or take an indirect approach to the industry and play the effect of rising prices on producers.

 

By James Rogers, TheStreet

 

Investors listening to Apple's (AAPL)first-quarter conference call Tuesday hoping for some Steve Jobs-style showboating and fiery rhetoric were surely disappointed. A soft-spoken, somewhat reserved Southerner is now center stage at the world's biggest technology company.

 

With Jobs on medical leave, all eyes are now focused on his No. 2, COO Tim Cook. Whereas his flamboyant boss spiced up press events and analyst calls with the occasional dig at fellow Silicon Valley companies like Adobe (ADBE), Cook's conference call comments (save for one swipe at rival tablet makers) were much more restrained. The Alabama native instead made vague references to the "magic of Apple" while giving little away about the company's broader strategy and its succession plan.

 

Cook, of course, is familiar with this role. He has already taken the company's reins on two prior occasions: for two months in 2004 when Jobs was receiving treatment for pancreatic cancer, and again for six months in 2009.

 

The recession hit capital equipment makers hard because many customers had to forestall upgrades in order to survive. But the market seems to be ignoring the fact this can't continue forever, and all that cash sitting around has to be put to use sometime soon.

 

Rex Moore, Motley Fool Top Stocks editor

 

With a record amount of cash now sitting on company balance sheets, management teams are beginning to feel comfortable enough with the economic recovery to start loosening the purse strings. One company that stands to gain heavily from this is Textron (TXT).

 

By Jeff Reeves, editor of InvestorPlace.com

 

Wal-Mart Stores Inc. (WMT) is looking to prove you can be a big-box retailer and still believe in smaller waistlines. And to help achieve that goal, it's asking the first lady for help.

 

The company announced a plan today that will give shoppers healthier food options at lower prices, cutting out some of the most unhealthful foods packaged under its store brands. Coupled with better food on the shelf is a better PR push for the company's healthful offerings -- led by a partnership with Michelle Obama, who will attend the official Wal-Mart announcement, according to reports.

 

The in-store plan involves taking unhealthful salts, saturated fats, transfats and sugar out of Wal-Mart store-branded products under the Great Value and Sam's Choice labels. The retailer also has pledged to lower prices on fruits and vegetables.

 

Shoot first. Shoot everything! That's the market's reaction to Internet backbone F5 Networks' (FFIV) earnings last night, and I have to tell you that I believe it is a vicious overreaction. But don't tell the sellers.

 

I am seeing anything connected to the Net down 5% to 10%. Anything. Juniper (JNPR). Salesforce.com (CRM). Riverbed (RVBD). Acme Packet (APKT). Motricity (MOTR). Akamai (AKAM) is the only one that seems not to be down too far . . . yet. The whole mobile Internet tsunami has been wiped out because of F5's guidance!

 

What's the truth here?

 

First, if you can get F5 down even 30 -- who would ever have thought that would merit an "even"? -- then you should just grab it.

That's ridiculous. The company is a good company. While you can't be overly eager, because we don't know enough yet about what "went wrong" at F5, it doesn't deserve to be drawn and quartered (or thirded)!

 

 

Boeing (BA) has a huge order in from China worth $19 billion, the White House announced today. The order of 200 aircraft will be delivered over three years.

But shareholders didn't react to the news, and Boeing shares actually fell by 1%. That's because there actually aren't any new orders to announce.

All those planes have already been announced in the past four years, The Seattle Times reports. Boeing has already received nonrefundable deposits on them and booked them as firm orders.

So the impact on Boeing is minimal. The only newsworthy thing to come out of today is that the Chinese government gave final approval to the airlines that placed those plane orders.