8 reasons the market isn't worse
8 reasons the market isn't worse

Stocks should be crushed by global turmoil, Jim Cramer says. Instead, they're doing fine.

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Retail is in recovery, so I'm adding BBBY to hlep my portfolio recover.

By Jim Van Meerten Apr 21, 2011 10:47AM
It's always nice when a store you like to shop in becomes a success. Bed Bath and Beyond (BBBY) is that kind of store.  I'm a kitchen gadget freak, so I love this store. 

I try not to be an impulse shopper, but as I wander the store I sometimes find bargains I didn't expect and can't pass up. Today I can't pass up the stock. 

Same-store sales are up 7% year over year.  The company is on target to add 40 new stores this year and another 40 to 50 next year. Margin squeezes have been offset by savings in SG&A so I think this looks like a well managed company. The price is on a roll.

Bed Bath & Beyond (BBBY) is a nationwide operator of superstores selling predominantly high-quality domestics merchandise and home furnishings typically found in better department stores.
 

Berkshire Hathaway lacks a valuable revenue source now that Goldman Sachs has bought back $5.5 billion in preferred shares.

By TheStreet Staff Apr 21, 2011 10:18AM
TheStreetBy Don Dion, TheStreet

 

Warren Buffett made the news during this shortened week after it was announced that Goldman Sachs (GS) had bought back the $5.5 billion in preferred shares it sold to Berkshire Hathaway (BRK.A) during the dire depths of the financial crisis.

 

In the midst of the credit mess, as Lehman Bros. was collapsing and Merrill Lynch was going through an emergency takeover, Goldman Sachs sought help from Buffett. Given his positive outlook for the U.S., the Oracle of Omaha was willing to step in and provide Goldman with a $5 billion fund to save the company from ruin.

 

The deal came with conditions. In return for the funding, Buffett received preferred shares that promised a 10% annual dividend and warrants to purchase $5 billion in Goldman common stock at $115 per share.

 

Why settle for streaming only 1 movie when you can watch multiple shows at once on your phone, TV and video game console?

By InvestorPlace Apr 21, 2011 9:03AM

Image: Film (© Comstock/SuperStock)By Anthony John Agnello, Consumer and Technology Writer

   

As Netflix (NFLX) has grown dramatically over the past two years, analysts and industry pundits have wondered repeatedly when the streaming video company would hit a glass ceiling: No way could Netflix shares pass $200. No way could the company's subscriber base reach 20 million. No way could it continue to sign new content partners.


Well, Netflix has met and surpassed all of those hurdles, but even now it is facing new challenges. How will it fend off new competitors and keep growing its membership at a breakneck pace?


The answer may have arrived. Netflix offered a preview of its future strategy earlier this week, announcing it will begin offering "family plan" subscription packages later this year.

 

Gold is not an investment, and gold is not contrarian. And its value is not bulletproof.

By InvestorPlace Apr 21, 2011 8:54AM

investorplace logo

Image: Gold (© Stockbyte/SuperStock)By Charles Sizemore, InvestorPlace.com


Gold prices topped $1,500 per ounce this week, days after Standard & Poor's roiled the equity and bond markets by lowering its outlook on the AAA credit rating of the U.S. government. 


After a decade in which stocks went nowhere and the U.S. dollar lost value to every world currency except the Zimbabwean dollar, many Americans are ready to give up on the entire system. Quite a few already have.


But frankly, gold today is as risky as tech stocks in 1999 and Miami condos in 2005, and the arguments supporting its rise are every bit as flimsy.  Here are the three biggest myths about gold that will pop the current bubble:

 

Peabody's share price could pull back as concerns rise about slowing growth in China.

By Jim J. Jubak Apr 20, 2011 4:12PM
Jim JubakI'd buy Peabody Energy (BTU) on the post-earnings drop -- except that I think you’ll be able to get this even cheaper in coming days. Commodity stocks will likely pull back (once again) over fears that growth in China will slow, as that country ratchets up its fight against inflation.

On April 19, the company announced first-quarter 2011 earnings of 67 cents a share, 7 cents a share better than Wall Street projections. Revenue of $1.75 billion was up 15% from the first quarter of 2010, and slightly exceeded analyst projections of $1.74 billion.

All this was pretty good for a company that saw its big Australian coalmines underwater for part of the period. But production declines were more than offset by price increases. Revenue per ton in Australia jumped by 43%, with price increases for metallurgical coal -- up 74% -- outstripping increases for thermal coal.

The stock was down yesterday on that company-specific news, and on a drop in the sector on those China fears.
 

The company performs well in the first quarter despite challenges from rising commodity costs and foreign-exchange rates.

By Jim J. Jubak Apr 20, 2011 3:26PM
Jim JubakIf this is what qualifies as a tough year for Nestlé (NSRGY), I’ll take it.

The company faces a headwind from a strong Swiss franc, which makes its products more expensive for customers pretty much everywhere else.

Costs are also climbing, with increases in the prices of everything from corn to sugar.

And yet for the first quarter of 2011 -- despite what the company calculates was a 9.8% hit from foreign-exchange rates -- the company saw sales for its continuing business fall by just 1.2% from the first quarter of 2010.

Organic growth, a measure which excludes currency effects, climbed by 6.4%, as the company’s emphasis on growing its business in emerging economies paid off big. The volume of goods sold climbed by 4.9%, beating the 3.7% increase expected by Wall Street analysts.
 

The U.S. Treasury owns 500 million shares of General Motors, and is tired of waiting for the share price to rise.

By Kim Peterson Apr 20, 2011 3:05PM
Image: Car Accident (© Hemera Technologies/AbleStock.com/Jupiterimages/Jupiterimages)How long do you hold on to a so-so stock? That's what the U.S. government is wondering about its massive stake in General Motors (GM).

The U.S. Treasury still owns about 500 million shares after the $50 billion rescue of the company in 2009. It would need to sell those shares at $53 apiece just to break even on its investment.

But GM's share price is nowhere near that amount. The stock hit a new low this week and is at about $30 today, down 19% year-to-date. The way fuel prices are moving, the chance of that stock hitting the $53 mark anytime soon are nil.

The government is likely just going to sell the stock at a loss to taxpayers, The Wall Street Journal reports. At GM's current price, taxpayers would lose at least $11 billion if the government sold its entire stake. But hey, what's another $11 billion to a government bleeding so much red it could pass for an extra on "Saw 3D"? 
Tags: gm

The company changes its business model to let fan response determine ticket prices. Will it work? With video interview.

By Kim Peterson Apr 20, 2011 2:42PM
After getting killed in last year's lackluster concert season, Ticketmaster is changing the way it does business. And it hopes scalpers lose out along the way.

Now Ticketmaster says it will adjust the price of sports and concert tickets according to demand. If shrieking girls can't get enough of a certain floppy-haired teen idol, for example, ticket prices will go up. But if, say, Rebecca Black launches a nationwide tour to slow demand, her ticket prices will drop.

It's a fundamental change to the traditional model for Ticketmaster, a division of Live Nation Entertainment (LYV). In the past, Ticketmaster worked with artists to set tickets at specific prices, and those prices didn't really change.

Post continues after this interview with Ticketmaster about the new pricing: 

The all-electric competitor to the Toyota Prius and GM Volt hybrids will be made in Tennessee.

By TheStreet Staff Apr 20, 2011 1:21PM

By Ted Reed, TheStreet

 

Kicking off the New York Auto Show, Nissan's top U.S. executive said the automaker plans to boost its U.S. production, including adding Leaf production in Smyrna, Tenn., by the end of 2012.

 

Carlos Tavares, the chairman of Nissan Americas, said the primary cause of the move is the strong yen, which has inspired a desire to ensure that a product "sold in the regions (is) 85% made in the region."

 

"That's the driver," Tavares said. He added that the earthquake and tsunami in Japan underscored the need for higher U.S. production, although all Nissan's Japan plants are now operating.

 

Slow iPhone sales, a surge in low-margin iPads, and parts shortages in Japan may crimp the company's forecast.

By TheStreet Staff Apr 20, 2011 12:33PM

the streetBy Scott Moritz, TheStreet

 

Apple (AAPL) is looking sharp going into a tech earnings season that, until Tuesday afternoon, had been a dismal parade of dullards.

 

If Apple delivers on plan, it will be less like the streak of earnings disappointments from Google's (GOOG) profit-robbing spending splurge and Texas Instruments' (TXN) big miss Monday that somehow came in below the target it lowered last month.

 

Blowout numbers from Apple could put it in the class of upside surprises like IBM (IBM) and Intel (INTC), which both flew past analysts' targets with earnings reports Tuesday.

 

But Apple's guidance is a whole other game, and there's reason to think the outlook in Cupertino, Calif., may not be a winner.

 

Investors looking for exposure to non-dollar-denominated assets may choose from two liquid currency ETFs set to benefit from growth of the Chinese currency.

By MoneyShow.com Apr 20, 2011 11:45AM
By Tom Aspray, MoneyShow.com

Monday’s plunge in global equity prices briefly boosted the dollar, giving some hope that it was finally bottoming. The optimism didn’t last long, however, as the dollar gave up most of its gains on Tuesday.

The negative technical outlook for the dollar is in agreement with the bearish fundamentals, and S&P’s recent downgrade of its US debt outlook is likely to add further downward pressure over the next few months.

The downgrade of US debt may have accelerated plans by the Chinese government to make the yuan more of a global currency. A Tuesday Wall Street Journal interview with a Hong Kong monetary official hinted that discussions were underway to make it easier to bring yuan funds raised overseas back into China.

This would open up the Hong Kong debt markets to many companies, and they would be able to invest in China without converting to dollars. Under current guidelines, large transfers of all currencies coming into China must be approved by the government.

Recent data suggests that the yuan is already becoming more global, as 7% of the foreign trade in the first quarter was in yuan, which was a sharp increase from just 0.5% last year. 
 

New funds allow investors to gain exposure to small companies in Brazil, Russia, India and China.

By TheStreet Staff Apr 20, 2011 11:39AM

By Don Dion, TheStreet

 

The BRIC nations are popular for both investors and fund providers. The ETF industry offers a wide collection of products that tap into Brazil, Russia, India and China from a number of perspectives.

 

The field of BRIC-related ETFs expanded last week with the launch of Van Eck's Market Vectors Russia Small Cap ETF (RSXJ). The first fund of its kind, RSXJ provides investors with exposure to a diverse collection of small companies based in Russia.

 

So far, the fund has seen limited interest and is still vulnerable to liquidity issues. I urge investors to hold off on RSXJ until it gathers steam.

 

This pharmacy-benefits manager has a much brighter future than its current stock price implies.

By Motley Fool Pick of the Day Apr 20, 2011 11:19AM

By Bryan White

 

About $14 billion in annual sales of brand name drugs have come off patent annually since 2008, but that was just the beginning. Starting in December of this year through the end of 2012, approximately $35 billion worth of sales more will lose patent exclusivity, including Lipitor, Plavix, and Singulair. One industry positioned to profit from the wave of new generic launches is the pharmacy benefits managers, or PBMs.

 

Born in the 1980s, PBMs work for health-care payors such as insurance companies, employers, and government agencies which outsource prescription drug plan management and claims processing. PBMs are responsible for developing and maintaining the formulary, contracting with pharmacies, and negotiating discounts and rebates with drug manufacturers on behalf of their clients, the health-care payors.

 

Your decision depends on your appetite for risk. At any rate, GM should be on investors' watch lists. With video on GM's prospects.

By TheStreet Staff Apr 20, 2011 10:59AM

By Jake Lynch, TheStreet

 

The new General Motors (GM)went public in November, collecting proceeds of $23 billion, which ranked as the second-largest offering in US history. The automaker was assisted by lead book-runners JPMorgan Chase (JPM) and Morgan Stanley (MS).

 

Although GM's stock -- initially valued at 7.8 times forward earnings, a sizable peer and market discount -- appeared cheap, it has tumbled from $33 to just over $29, as of Tuesday's close. The stock has tumbled 24% from a recent high around $39 to a fresh post-IPO low. What happened?

 

Momentum-driven stocks that are plagued by skepticism have a tendency to rise into a positive earnings report.

By TheStreet Staff Apr 20, 2011 10:44AM

By Ali Meshkati, TheStreet

 

A few months ago, I wrote an article that said Netflix (NFLX) would outperform Apple (AAPL) during any market correction. What I should have written, at that time, was that Netflix would outperform Apple, period.

 

The point of the article was missed by most. I take full responsibility as I probably mixed in too many distracting points and topics. It's not about an Apple vs. Netflix war of technology, executives or each company's place within this technology-driven world.

 

The point of the article was that market psychology drives stock price, irrespective of fundamentals. When a momentum-driven trend begins in a company that is under a tremendous amount of scrutiny and doubt, it creates a support dynamic for the stock. It allows the stock to continue to a share price and market cap that not even the founders of the company could have imagined would be possible.

 

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[BRIEFING.COM] The stock market capped the trading week with losses across the major averages. The S&P 500 fell 0.5% to surrender its weekly gain, while the Dow Jones Industrial Average (-0.7%) and Russell 2000 (-0.9%) underperformed. The two indices posted respective losses of 0.8% and 0.6% for the week.

Equity indices were pressured from the get-go after several heavyweights disappointed the market with their earnings and/or guidance, which led to some broader profit-taking. After ... More


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