You can still find small-cap superstars
Small-cap superstars still abound

There are some picks in this sector that have excellent valuations and strong earnings growth.

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Beyond the static is positive news for stocks that should boost valuations.

By Jamie Dlugosch Jul 18, 2011 10:02AM

Earnings season kicked off last week with a solid report from Alcoa (AA). Unfortunately the market was more interested in the dysfunction in Washington. The debate over the debt limit overshadowed all else, sending investors to the exits.

 

Stocks were lower across the board.

 

Taking the debt discussion out of the equation, investors ought to be encouraged. There were lots of solid reports last week, including a big number from Google (GOOG). That news sent shares up a whopping 12% Friday.

 

What does the news portend for Apple? The technology giant reports earnings Tuesday, and most observers expect another strong report.

 

With many big names reporting results next week, stocks are likely to trade higher. Google's performance shows how large companies can make investors money. I’ll stick with that theme by making the SPDR S&P 500 (SPY) the ETF to own this week.

 

The search giant may be the real social-media play, thanks to the launch of its innovative Google+ platform.

By InvestorPlace Jul 18, 2011 9:54AM

By Tom Taulli, InvestorPlace Writer


Not that long ago, Google (GOOG) was almost considered a has-been, stagnating in the "value trap" like other tech giants such as Cisco (CSCO).


It turns out news of Google's death has been greatly exaggerated. As seen with its latest quarterly report, the company still appears to be in growth mode.


In fact, the company is attacking the pesky social operators Facebook and Twitter, both of which have been fetching huge valuations. And as we've seen with the huge valuation of LinkedIn (LNKD), investors are extremely hungry to get shares in these companies when they hit the public markets.

 

In the past 72 hours, Europe got worse and debt-ceiling talks in the US deteriorated.

By Jim Cramer Jul 18, 2011 8:04AM
jim cramer

the streetStunned at how bad it looks Monday. Stunned that nothing good ever seems to happen in Europe at all. Nothing.


The stress tests just seem like total shams. I would have thought that, given the tremendous sovereign bond holdings these banks have, it would have been prudent just to issue statements that said, "If the banks we know have X level of debt don't raise capital, we will seize them and nationalize them." Something with real teeth.

 

Without that, we are facing the absurdity of this slow death that grinds and grinds. We have a 1980s-style Latin American debt crisis here. The sophisticated people around the globe know this, so there is no exit until the capital is raised and the bullet is bitten on the bogus sovereign bonds.

 

I was hoping for Geithner-like stress tests, ones that found every major bank issuing a ton of equity, something that makes our banks solvent -- although that does not make them investible.

 

Big-time redemptions may have caused several would-be rallies last week to fail. A short-term rally remains likely, but if sell-offs continue, June's lows could be tested.

By MoneyShow.com Jul 16, 2011 7:40AM
By Tom Aspray, MoneyShow.com

It was clearly a rough week for stocks. Despite historic oversold readings after last Monday’s selling, rally attempts have been feeble. Typically, such an oversold market would stage a decent one- or two-day rally, but it never came last week.

Selling by hedge funds could be keeping the market lower...as several days last week, stocks opened strong only for the rally to fizzle quickly. June saw the highest level of hedge-fund redemptions since October 2009, and I doubt things have gotten better in July, as most apparently missed the rally.

For the year, the HFN Hedge Fund Aggregate Index is up just 0.63%, against over 6% for the S&P Total Return Index. Therefore one can see why hedge-fund investors may be looking elsewhere: If the hedge funds are selling in order to meet redemption requests, it could explain the recent action.

Obviously, the stock market and economy had enough barriers to overcome last week without the hedge funds. Early last week, concerns over Italy’s debt surfaced, and of course the ongoing stalemate over the debt ceiling has many worried.
 
Tags: goldoil

BHP Billiton's massive cash bid for Petrohawk sent Petrohawk's share price soaring on Friday.

By Jim J. Jubak Jul 15, 2011 10:26PM
Jim JubakBig news on Petrohawk (HK) since my post on how to use the mergers-and-acquisitions boom to develop an investing strategy for this crazy market.

After Thursday’s close, BHP Billiton (BHP) announced a $12.1 billion cash bid for Petrohawk. The price is about 65% higher than the closing share price for Petrohawk on Thursday, which was $23.49. (Petrohawk closed Friday up 62% to $38.17.)

BHP, which earlier this year paid $4.8 billion to acquire shale oil and gas assets from Chesapeake Energy (CHK), is clearly still in the hunt for more shale acreage. Petrohawk owns about 1 million net acres of shale in the Eagle Ford, Haynesville, and Permian basins of Texas and Louisiana. (Eagle Ford is one of my two favorite shale plays -- the other is the Bakken formation in North Dakota and Montana.)
 

Fortune calculates that the golfer may only earn $20 million in endorsement deals this year -- a huge drop from the past.

By Kim Peterson Jul 15, 2011 4:04PM
Tiger Woods is a legendary pitchman, having hawked products for Gillette, Accenture and Gatorade. But those deals are long gone, and now the golfer only has three major promotional deals, Fortune reports.

Woods has still signed with Nike (NKE), Electronic Arts (ERTS) and Kowa, a company that makes a heat rub in Japan (insert your own joke here). He was likely only paid in the single-digit millions for a recent Kowa commercial running in Japan, Daniel Roberts writes.

This leads Fortune to speculate that Woods may actually be running out of money -- or at least isn't making enough to cover the lifestyle to which he's become accustomed. 

After the company's fantastic June quarter, Wall Street is piling on the love and the stock is soaring.

By Kim Peterson Jul 15, 2011 2:05PM
All it takes is one giant quarter and Google (GOOG) is back to being a Wall Street darling.

After the search giant blew away expectations Thursday with its June quarter results, analysts who previously questioned the company's aptitude have fallen in love all over again.

They're cheering the fact that Google is growing revenue faster than at any time in the past three years. About 135 million devices now use the company's Android mobile platform, and 10 million people are trying out the new Google+ social-networking service. Google's shares were up more than 12% Friday to $594.80 in midday trading.

Google's guns are a'blazin', and newly minted chief executive, and co-founder, Larry Page was happy to crow about it, staying on through the entire conference call with analysts Thursday, Barron's reports

Activist investor Carl Icahn claims the household name could be worth $100 per share. What should investors do?

By TheStreet Staff Jul 15, 2011 1:59PM

By Chris Stuart, TheStreet

 

Never a dull moment with Carl Icahn.

 

The investor put in an unsolicited bid Friday for Clorox (CLX). At an offer price of $76.50 per share, the proposed deal would equate to just an 11% premium over Thursday's closing price. But Icahn has a different price target for Clorox in mind, one that is substantially higher.

 

As noted in his letter to Clorox CEO Donald Knauss it is likely that his intention is not to buy out the company, but for a white knight to step in and come up with a higher bid, ultimately making Icahn's 9.4% stake worth a lot more then it was worth a few days ago. Icahn encourages Clorox to "hold an open and friendly 'go-shop' sale process where all the synergistic buyers are offered due diligence and invited to bid."

 

American Superconductor gets hammered. Silvio Berlusconi blames speculators for the implosion of Italian banks. Deutsche Bank hires Janet Jackson at $17,700 a minute.

By TheStreet Staff Jul 15, 2011 1:50PM

By Gregg Greenberg, TheStreet

 

Here is this week's roundup of the dumbest actions on Wall Street.

 

5. American not-so-Superconductor

 

Shares of American Superconductor (AMSC), which makes electrical systems for wind farms, fell 5% this past Monday and another 5% on Tuesday. The stock is down nearly 40% since mid-April and more than 70% year-to-date.

 

The media empire's CEO will answer questions about accusations of phone hacking. The CEO of the company's UK newspaper unit resigns.

By TheStreet Staff Jul 15, 2011 1:20PM

the streetBy TheStreet Staff

 

News Corp. (NWSA) CEO Rupert Murdoch, whose British newspapers have been battling accusations of phone hacking for the past week, will appear before members of the British Parliament next week to answer questions about the scandal, according to The Wall Street Journal.

 

Earlier on Friday, Rebekah Brooks resigned as CEO of News International, News Corp.'s U.K. newspaper unit. She will be replaced by Tom Mockridge, the CEO of News Corp.'s Sky Italia operations. Brooks and James Murdoch, who heads international operations for the giant media group, will also testify before the parliamentary committee, according to the Journal, which News Corp. owns.

 

James Murdoch said Friday that the newspaper group will apologize to Britain for the phone hacking. The company also plans to set up an independent committee to investigate claims of improper conduct. While News Corp.'s stock has dropped 11% during the past week, its shares were up 0.9% at $15.57 Friday.

 

The easiest way to invest in this country is also the riskiest.

By Motley Fool Pick of the Day Jul 15, 2011 11:59AM

Image: (Shanghai, China © Yang Liu/Corbis)By Tim Hanson

 

It's undoubtedly painful to have been an investor in any of the Chinese-listed companies that have been alleged to be or exposed as frauds over the past year. That's a feeling that's been shared by individual investors as well as by revered professionals such as John Paulson (Sino-Forest), Hank Greenberg (China MediaExpress), and Lee Ainslie (Longtop Financial).

 

We've shared in that pain at Motley Fool Global Gains as well, with two of our China picks, Yongye International (YONG) and China Green Agriculture (CGA), having had serious questions raised about them at one time or another. We believe our research of these companies has addressed these questions, but it is also true that our once-significant gains in these stocks have been largely erased.

 

A better way?
It's in the face of those losses that many Fools have asked me why we bother investing in individual Chinese companies at all. Even if China's economy continues to grow, wouldn't it be easier and safer just to buy an exchange-traded fund such as the China 25 Index (FXI) and remove some of the company-specific risks that have recently crushed so many investors?

 

These funds provide exposure to companies the Oracle has shown interest in.

By TheStreet Staff Jul 15, 2011 11:25AM

(© ULTRA.F/Digital Vision/Getty Images)By Don Dion, TheStreet

 

Given his legendary knack for picking winners, it's no wonder market professionals and do-it-yourself retail investors tend to keep a close watch on Warren Buffett to see what new companies he has his eyes on.

 

Buffett's acquisition preferences have received particularly heavy focus throughout 2011 in light of his massive cash reserves as well as his words and actions.

 

In his annual letter to Berkshire Hathaway (BRK.A) shareholders, Buffett used his recognizable folksy charm in an attempt to portray his desire to find acquisition targets. In the document, he said he and partner Charlie Munger have their elephant gun reloaded and are prepared and eager to pull the trigger when an attractive opportunity presents itself.

 

Proven technical measures show that it's a high-risk time to buy these market leaders.

By MoneyShow.com Jul 15, 2011 10:50AM
By Tom Aspray, MoneyShow.com

It has been a tough week so far for the major stock market averages, as ratings cuts and the increasingly hostile environment in Washington have cut several rallies short. The major averages have retraced up to 50% of their rallies from the June lows.

The bottoming formations in the Advance/Decline (A/D) lines are still intact, but that could change with another day or two of negative A/D numbers. The McClellan Oscillator has dropped from a high last week of +247 to Thursday’s close at -70. Stocks need to turn higher by early next week to keep the market in rally mode.

Despite the overall market weakness, there are some stocks that have bucked the trend and are trading nearer to recent highs than recent lows. Even the strongest stocks undergo corrections, so it is important to know when a stock is overbought because that is clearly not the time to buy. It can also be helpful to those who want to take some profits on existing long positions.

My favorite way to measure whether a market is overbought or oversold are Starc bands, as they can often alert us to price extremes. Last week, in discussing NetFlix Inc. (NFLX), I noted that it was “getting closer to the weekly Starc+ band at $305.” This week, the company announced a controversial new pricing plan and the stock rallied to a high of $304.79 before reversing to close Thursday at $286.62.

The action in NFLX illustrates why these four stocks—Microsoft Corp. (MSFT), International Business Machines (IBM), McDonald’s Corp (MCD), and Coca-Cola Co. (KO)—could be vulnerable in the week ahead.
 
Tags: ibm

Check out the tech sector's best cheap investments, which have aggressive upside potential.

By InvestorPlace Jul 15, 2011 10:01AM

Image: Pennies (© Corbis)By Louis Navellier, Editor, Blue Chip Growth


There is no better place to find explosive growth than with low-priced penny stocks. I'm not talking about pink-sheet stocks that are potentially nonexistent, or fraudulent names set to crash. I’m talking about real companies with real earnings -- companies listed for more than one year on a major exchange like the AMEX, NYSE or Nasdaq that have a market cap in the ballpark of $100 million.


The returns can be even more powerful when you combine the power of technology stocks and penny stocks. Specifically, the software space is seeing lots of action thanks to the mass acceptance of smart phones and personal computing devices.


These devices are quite powerful, but they still need programs to make them run. The best software companies are those that make users more productive. In this tough economy, those companies that help workers do more with less are poised to be the penny stocks that really move higher.

 

Like the trusted brands of Clorox or the natural resources of Petrohawk, there are assets in this country worth far more to bigger companies than they are in the stock market.

By Jim Cramer Jul 15, 2011 9:18AM

jim cramer
the streetWhile Washington burns, the corporate world isn't fiddling -- it's taking action, with companies taking advantage of depressed pricing, unusual valuations and unique properties to do some buying.

 

This morning's ridiculously lowball bid for Clorox (CLX) by Carl Icahn is an example of what's about to happen in this country. I have little doubt that now that Clorox is in play, a company like Unilever (UN) will easily spend $12 billion or $13 billion to snap it up. You could see this one go to $100 a share once it is in play -- wildly overvalued on depressed earnings, but incredibly cheap as an asset play with great brands.

 

The stock's been lower than it should be because management overpaid for Burt's Bees and has undermanaged its core brands. It lacks scale. But it will be perfect for a Unilever counter to Procter & Gamble (PG), which once owned Clorox but was forced to divest it by an aggressive FTC in the 1960s.

 

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[BRIEFING.COM] The stock market ended the Thursday session on a modestly lower note, but a late-morning rebound lifted the indices off their lows. The S&P 500 shed 0.2% with seven sectors ending in the red.

This morning, European equities and U.S. futures slumped around 6:00 ET after Ukraine's President Petro Poroshenko was quoted as saying Russian forces have invaded an area southeast of Donetsk. The news pressured the markets, but a brief uptick took place after a correction to ... More


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