Stocks have rallied 177%, and while calling a top is the easiest thing to do, it might not be the most accurate, Cramer says.
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Morningstar says NRG Energy and Sprint, among others, may get a big boost if business turns in their favor.
By Jake Lynch, TheStreet
Investors have overlooked the inherent value of the following five companies, which receive five-star ratings from Morningstar. Still, they have many challenges. Morningstar predicts the stocks could more than double as business fundamentals improve. Below they are ordered by potential return, from great to best.
5. GenOn Energy (GEN) is an independent power producer with exposure to volatile commodity markets. It was formed through the all-stock merger of Mirant and RRI. The combined entity boasts a stronger balance sheet and competitive position.
Traders who don't understand the necessity of bargains in retail have missed out on much of the sector's surge. But one discount retail stock is still 'a screaming buy.'
As we go into the final days before Christmas, let me tell you the most overrated word in the stock investing lexicon: discounting. This refers to the idea that the retailers are going to miss the numbers because of all the discounting going on.
One of the most amazing facts out there is that the retailers know they have to offer bargains. They know the consumer is smart. They know people compare prices on the Web. They know that when consumers go to stores, they have prices in mind, regardless of the possible service they will get -- and they care more about price than ever.
Nokia seizes control of the Symbian platform and looks to Apple's business model. But a key delay doesn't help.
Don't even think about shorting it, Reed Hastings writes in response to a fund manager's doubts.
Today, Netflix chief executive Reed Hastings is fighting back. He posted a long response on Seeking Alpha telling Tilson: "Cover your short position. Now." But in a surprising bit of candor, Hastings acknowledged that one could in fact make money shorting Netflix.
Curiously, Netflix's share price did fine last week after Tilson's piece came out, climbing Thursday and briefly topping $184 Friday. But today, after Reed's defense, Netflix shares are down slightly to $178.17.
Not just cheap but also dominant, these companies could ride a stronger-than-expected economy to huge gains next year.
By Jake Lynch, TheStreet
Technology stocks in the S&P 500 ($INX) have generated an average gain of 16% in 2010, the third-worst-performing industry group. But as the recovery ramps up next year, business and consumer spending will accelerate, and tech stocks may lead, analysts say. Value-focused Morningstar covers hundreds of technology stocks but awards its highest five-star rating to only four.
Here is a closer look at those four technology value stocks. They are expected to rise at least 53% and as much as 99%. Below, the stocks are ordered by potential return, from great to colossal.
4. Dow component Cisco Systems (CSCO) makes networking equipment. It holds the dominant position in ethernet switches, with roughly 70% market share, a stable figure. It is also the leader in routers, with Juniper (JNPR) grabbing second place.
US employees could get the same chance that UK staffers have to share in the company's success.
By Jeff Reeves, editor of InvestorPlace.com
After a rough few years during the financial crisis and subsequent recession, Starbucks (SBUX) has been piping hot in 2010. Thanks to an innovative new line of Via instant coffee, a push into retail grocery sales and a number of successful promotions (including Starbucks' free holiday drink offer), the coffee giant is definitely on the upswing.
And it appears Starbucks is willing to share that success with workers in the new year via company stock. Not a bad Christmas present, considering SBUX is up 43% in 2010 -- about three times the broader stock market.
Funds tracking commercial real estate and retail are likely to be active.
By Don Dion, TheStreet
Here are five ETFs to watch this week.
Retail has been an exciting region of the market to watch this holiday season. As we head into the final stretch, malls will likely be packed with shoppers seeking last-minute gifts.
The anticipation of the holidays will make XRT an interesting fund to watch. The fund could also see some earnings-related action. Throughout the middle of the week, index constituents including Carmax (KMX), Finish Line (FINL) and Walgreens (WAG) are scheduled to release their most recent quarterly earnings reports.
With the dollar deflated, major US brands are cheaper than ever -- and forward-thinking foreign companies realize it.
Why is this so important? Because Sara Lee is also Kimberly-Clark (KMB), which is also Clorox (CLX), which is also Heinz (HNZ), which is also Kellogg (K) -- big brands that need better homes than they have. And they can be bought because the dollar is weak and the people who don't think small want these brands as a way to move beyond their home markets.
Keep a neutral to slightly negative bias as we march toward 2011.
Right idea, horrible execution as the market began its annual winding down of the year with slower volume and disinterested trade.
The market closed up fractionally. Within that construct my ETF picks ended up dropping ¾ of a percent. What happened?
Sometimes no matter how right your predictions Mr. Market can manage to punish even if you are trying to be conservative as I was last week. The loss can be solely attributed to big losses in China last week.
That won’t happen again. We’ll jettison that pick in favor of the SPDR Regional Bank ETF (KRE) as I keep a market neutral portfolio heading toward the end of the year.
Broad measures of U.S. industrial production keep improving, but some stocks in the sector stand out above others
As the U.S.'s recovery from the "Great Recession" has progressed, one big driver of the turnaround has been the industrial and manufacturing arena. Industrial production rose in November by 0.4%, according to a new Federal Reserve report, marking the 15th time in 17 months that production has increased. And since bottoming in July 2009, the manufacturing sector has expanded for 16 straight months, according to the Institute for Supply Management.
As a result, industrial and manufacturing stocks -- which were hammered during the recession and bear market -- have outpaced the broader market since the March 2009 low. But, just as there's still slack in U.S. production, so too are there still bargains in the industrial and manufacturing areas. And, with government stimulus continuing to flow into the economy, consumers regaining some of their confidence, and companies having cut a lot of fat during the downturn, some of these stocks are in good position to continue rebounding.
Keep in mind, however, that as we get deeper into the recovery, the rising tide that may have lifted a lot of industrial/manufacturing-type stocks should lessen, and investors will likely become more discriminating about which of these stocks they buy. That means you better pay attention to fundamentals on a stock-by-stock basis. With that in mind, I recently used my Guru Strategies, each of which is based on the approach of a different investing great, to uncover some of the industrials and manufacturers that have the best fundamentals. Here's a sampling of what I found.
Potash of Saskatchewan thinks a 5% increase in grain production is needed in 2011 to keep up with consumption.
Profit from Moody's recent downgrade of Ireland.
Written by Douglas Estadt
Moody’s (MCO) downgraded Ireland Friday, which resulted in a mad rush to buy U.S. Treasuries. This reaction is startling due to the fact that the term PIIGS (describing doomed European countries) has been tossed around for some time.
PIIGS is an acronym describing the struggling economies of Portugal, Italy, Ireland, Greece and Spain.
One firm has been killed on its short position, but it's sticking to its guns.
Tilson, the founder of investment firm T2 Partnerships, even put out a "Why we're short Netflix" presentation Thursday. You can download it here.
Netflix shares are up about 1% Friday to $183; a year ago they were at $53. "We've lost a lot of money betting against Netflix, which is currently our largest bearish bet," the presentation notes. Here are the main reasons Tilson continues to short the stock:
Airlines turn to fees instead of service to boost profits. Gap slips up by selling 'Made in USA' bags made in China. Starbucks' tormented love-hate relationship with Kraft.
Here's our weekly roundup of the dumbest news in business.
5. High-flying airline fees
According to a report released Monday from the Bureau of Transportation Statistics, U.S. airlines collected about $4.3 billion in fee revenue during the first three quarters of 2010. That's $4.3 billion in fees added to the coffers without airlines having to improve service. It's roughly equivalent to the industry's anticipated total profits for the year.
The investor has a considerable interest in the company, which expects growth in its core business next year.
By Don Dion, TheStreet
This week, GE CEO Jeff Immelt provided an optimistic forecast. In comments made to investors during the company's annual meeting, he explained that, though demanding, the steps taken after the global economic crisis have helped GE get back on track. He expects core businesses to grow in 2011.
Immelt pointed to China as a promising region for the company in the new year, saying the company expects to see high-double-digit growth.
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The solid report comes a month after the retailer closed all of its Canadian operations.
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[BRIEFING.COM] The stock market finished an upbeat week on a mixed note. The S&P 500 added just over a point, holding its weekly gain at 1.0% while the Nasdaq lost 0.4%.
The major averages began the day on an upbeat note, but relinquished their opening gains during the first 90 minutes of action. The early sentiment was boosted by a better-than-expected nonfarm payrolls report for February (175K versus Briefing.com consensus 163K), but a closer look into the report suggested that ... More
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