There are some picks in this sector that have excellent valuations and strong earnings growth.
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The billionaire investor made few moves and posted just a small gain in the first quarter.
By Frank Byrt, TheStreet
It's the second quarter in a row of little activity for the investment company run by the man dubbed the Oracle of Omaha for the trading prowess that helped him build an estimated net worth of $50 billion over half a century. In the first quarter, former hedge fund manager Todd Combs started working at Berkshire, managing part of the portfolio, as the 80-year-old billionaire selects a succession team.
Berkshire Hathaway's 26-stock investment portfolio was valued at $53.6 billion as of March 31, up $1 billion, or 2%, from the end of 2010, according to a Securities and Exchange Commission report that the hedge fund filed late Monday. Buffett isn't required to publish foreign holdings. The benchmark S&P 500 Index ($INX) rose 5.4% in the first quarter.
Evercore may be smaller than big investment banks, but it's well-positioned to get a piece of the buyout biz in 2011.
After the 2008 financial crisis, merger-and-acquisition activity plunged. But recently, things have perked up. Just look at Microsoft (MSFT) last week, which paid a hefty $8.5 billion for Skype, or the recent plan from AT&T (T) to acquire T-Mobile from Deutsche Telekom for $39 billion. (Microsoft owns and publishes MSN Money.)
No doubt, the deal making has boosted the fortunes of investment banks. But your best bet to cash in on the M&A boom isn’t one of the big players. It's a smaller buyout shop that is doing big business despite its size.
That stock is Evercore Partners (EVR).
One is a cheap stock that has simply run out of buyers, while the other is undisciplined and lacks a growth catalyst.
I'll begin with Apple because we own it for Action Alerts Plus. It's a cheap stock that just happens to be out of buyers. It seems that everyone who wants it already owns it, and the angst factor is causing selling.
I think the stock is cheap even if you don't back out the cash, and I also think that if Steve Jobs were healthy, the price would be higher. I just get the sense that so many people have one foot out the door that it can't rally.
Abbott is about as balanced as it gets in the pharmaceutical sector, and an increase in sales and profit is likely this year.
The search giant plans its first-ever bond offering for later this afternoon, and demand is riding high.
The funny thing is that the bonds aren't exactly paying well; there are definitely better ways to make money. But this is Google we're talking about, and that's enough to get investors plenty worked up.
"People aren't going to do very much credit analysis, they're going to look at the balance sheet, and look at the cash, and say 'This is ridiculous' and put their orders in, and probably big orders," one money manager told Bloomberg. "It will be scooped up like nobody’s business."
As part of a lawsuit settlement, the satellite radio company says it will not raise subscription prices through the end of the year.
The news, announced in a regulatory filing, comes as part of a lawsuit settlement that Sirius agreed to last week. Through the end of the year, Sirius won't raise the price of its basic satellite radio service, its other programming packages or its Internet streaming services. In addition, it won't increase its U.S. Music royalty fee or decrease its multi-radio discount.
Current subscribers can renew their subscriptions at those rates before the end of the year. Shares of Sirius fell nearly 3% on the news to $2.17 in midday trading. The stock has made a remarkable turnaround as the auto sector has recovered, rising 18% in the past year.
Post continues after video about Sirius' recovery this year:
The company's charitable foundation runs three donation-based restaurants, which have raised money for surrounding communities. With video.
Customers place orders as they would at any other Panera, but the cashiers simply tell customers the suggested payment amounts for their orders. What customers actually put into the donation box is up to them.
Panera has opened three such specialized cafes, which raise money for charities. It plans to open a new one every three months, The Associated Press reports. Yes, there was that time when three college students paid $3 and received $40 worth of food, but mostly people are generous with their wallets, the company says.
Post continues after this video about whether Panera's nonprofit concept will work:
Funds that hold commodities or rely on complicated strategies used to occupy a small niche in the fund industry, but that's changing.
By Stan Luxenberg, TheStreet
During the past year, inflows into alternative mutual funds and exchange-traded funds have totaled $25 billion, according to Morningstar. Now the category has $151 billion in assets and includes 540 funds.
Morningstar recently announced that it would begin tracking new categories of alternative funds, including inverse debt and managed futures. "It's clear that alternative funds are here to stay," said John Rekenthaler, vice president of research for Morningstar.
Alternative funds aim to diversify portfolios by focusing on investments that don't necessarily track stocks or bonds. The funds hold commodities or use complicated strategies, such as trading futures or selling stocks short.
This fund offers investors fixed-income exposure to growing economies.
By Roger Nusbaum, TheStreet
The most interesting new bond ETF is Market Vectors' LatAm Aggregate Bond ETF (BONO). LatAm is short for Latin America. The ticker symbol is taken from bono, which is Spanish for bond.
This new ETF tracks a large number of countries. Brazil has the largest weighting, accounting for 27% of the fund, followed closely by Mexico, which accounts for 26%. Colombia has a 12% weighting, the Cayman Islands has 8.8%, and Chile has a disappointingly low 2.9%. There are also more than a dozen countries with individual weightings of less than 1%. The fund has more than 450 holdings, which explains why some of the country weights are so small.
This small-cap defense company has the all the right qualities.
By Jason Moser
A little more than a week ago, I penned an article citing three stocks on my watch list, thinking that at least one of them had a good chance of making it into my real-money Rising Stars portfolio. Now I'm putting one of those stocks to work and playing a little defense in my quest for investing domination.
Elbit Systems (ESLT) may not be what you would call a headline stock, but the company takes care of business when it comes to defense. Based out of Haifa, Israel, Elbit is the largest non-government-owned defense company in Israel, with an extremely diverse range of programs and clients around the globe with business segments in the U.S., Israel, Europe, South America, and Asia.
And the technology is cool. Elbit's a major player in everything from aerospace and helmet-mounted systems to lasers and advanced C4I (command, control, communications, computers, and intelligence) systems.
Soup is all but forgotten as a meal choice, even though Americans have plenty of cans in their pantries. With video.
The stock price has stumbled over the past year. Sales have fallen in eight of the past 10 quarters. Profit is down from a year ago, and the company has lowered its full-year forecast. The chief executive is leaving.
Soup doesn't sell that well anymore. Americans have all kinds of choices for quick meals at home, leaving the can of soup -- once the go-to choice for lunch in a jiffy -- in the dust. People still buy soup, but they just forget to eat it, so the cans are relegated to the back of the pantry.
Post continues after this video about Campbell's troubles:
Materials and industrials look technically vulnerable, meaning investors should exercise caution and have tight stops in place.
Don't be seduced too easily into buying ETFs, ETNs or other exotic investment products.
By Greg Plechner, TheStreet
We've seen the cliche, a 40-year-old hitting a midlife crisis and trading in his reliable 2002 Toyota Camry for a faster sports car that will likely get him into trouble -- at home and on the road. While we can all relate to being lured by owning the trendiest hot-ticket item, sometimes it's best to avoid those temptations, including when it comes to choosing retirement investments.
When you are in your 40s, you're well into what is often viewed as the "accumulation phase" of retirement planning, the period when you are usually working and contributing regularly to your 401k and other retirement accounts to build up your retirement nest egg. You may be advised to buy a diverse mix of mutual funds at companies with low cost structures and consumer-friendly business practices.
Which you do, of course, until a newer and sometimes more exotic product hits the market, with the promise of better and bigger returns. Recently, ETFs and ETNs have become those vehicles. Proponents point to their tax efficiency and low expenses, but they can also be more complex and potentially riskier. Before you trade in your staid mutual funds, take a closer look at what you are buying.
Keep an eye on funds tracking silver, agriculture, construction, retail and the Dow.
By Don Dion, TheStreet
Here are five exchange-traded funds to watch this week.
As forecast in last week's "5 ETFs to watch," commodities have continued to behave in a volatile manner. The bullion-backed SLV's performance was particularly bipolar. During the early part of the week, SLV managed to pull off gains, but its strength was short-lived. By Friday, it had retreated to the previous week's lows.
Silver will continue to generate press in the week ahead as market watchers debate and discuss the longevity of the current commodities shakeup and look for ways to navigate it.
Although I continue to view precious metals as a promising long-term play, I urge investors to avoid being overly exposed to this asset class. By keeping exposure to materials like gold and silver small and concentrated, you can benefit from their long-term defensive nature while protecting against short-term volatility.
We've been fortunate to avoid a big sell-off in stocks. Stay conservative this week.
If you are not trading in this market, you are either stubborn or ignorant. For those die-hard buy-and-hold followers, it is probably a combination of the two.
For the rest of us interested in making money in a market rigged against the little guy, we have no choice but to be nimble. Thank goodness Wall Street created exchange-traded funds.
While corporate profits continue to impress, stocks have traded sideways over the past two weeks. Consider yourself lucky that we have not gone lower.
I expect that to change soon. As such, I would strongly consider an ultra-short ETF for your portfolio this week. My choice would be ProShares Ultra Short Technology (REW).
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[BRIEFING.COM] Equity indices closed out the month of August on a modestly higher note. The Russell 2000 (+0.6%) and Nasdaq Composite (+0.5%) finished ahead of the S&P 500 (+0.3%), which extended its August gain to 3.8%. Blue chips lagged with the Dow Jones Industrial Average (+0.1%) spending the bulk of the session in the red.
The final week of August represented one of the quietest stretches for the stock market so far this year. The first four sessions of the week produced the ... More
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