There are some picks in this sector that have excellent valuations and strong earnings growth.
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Homebuilding stocks have recently rebounded strongly, and investors can now look to buy select stocks on future pullbacks.
By Tom Aspray, MoneyShow.com
The homebuilding industry group is one of the stronger components of this sector, and it now appears that it completed a significant bottom in October. It has been a long time since the Dow Jones Home Construction Index completed a weekly head-and-shoulders top in 2006.
Overall, earnings growth is likely to slow this year, so investors should look to cash-rich, US-focused companies that might deliver upside surprises.
Fourth-quarter earnings season got off to a sorry start Monday when aluminum producer Alcoa (AA) reported results that were just as disappointing as the market had been expecting, including its first loss in more than a year.
But don't get too distracted by Alcoa's bleak results and outlook. True, it's the first company in the Dow Jones Industrial Average to report, but that doesn't mean it's a harbinger of bad news to come. Companies generally have been revising their earnings outlook downward, but that simply reflects the need for caution in turbulent times and leaves room for upside surprises.
With monthly dividends and an attractive yield, this school bus operator is going for growth.
By Roger Conrad, Canadian Edge
You won't have income for long without growth. Student Transportation (STB) has plenty of both, with monthly dividends that produce a yield of more than 8.5% and contracts in place to grow revenue 18% this fiscal year.
We believe this North American pure play energy infrastructure company will be able to generate highly visible cash flow and dividend growth.
By: Zacks Equity Research
Following the successful separation of its upstream operations via a tax-free spin-off, we have upgraded Williams Companies Inc. (WMB) to "outperform" from "neutral."
Tulsa, Oklahoma-based Williams is a premier energy infrastructure provider in North America. The company’s core operations include finding, producing, gathering, processing, and transporting natural gas. Boasting of a widespread pipeline system, Williams is one of the largest domestic transporters of natural gas by volume. Its facilities -- gas wells, pipelines, and midstream services -- are concentrated in the Northwest, Rocky Mountains, Gulf Coast, and Eastern Seaboard.
Many regional and local banks are starting to do better as the economy expands.
By Igor Greenwald, MoneyShow.com
Two months ago, I called bank stocks "lepers," harping on the market's lack of faith in the financial health of Morgan Stanley (MS), Bank of America (BAC), Citigroup (C), and other money-center banks trading at vast discounts to alleged book value.
Lower lows followed shortly, but for the past six weeks much of the banking sector has been rebounding. The charts of Wells Fargo (WFC), US Bancorp (USB), and even JP Morgan (JPM) are resurgent, making Citi and B of A look more like laggards than canaries in a coalmine.
But a long-term plan may not be enough to ward off short-term risks.
Eastman Kodak's (EK) stock soared Monday -- well, relatively speaking -- on news that the company is restructuring to adapt to the digital age. The company is creating two distinct business units to separate commercial from consumer products and will streamline costs even more.
Many folks watching Kodak were expecting a much different announcement: that the once-dominant photography company was declaring bankruptcy and possibly disappearing forever.
So does the new move change anything or secure Kodak's future?
Hyatt Hotels and Marriott are upgraded to 'buy,' while Starwood Hotels is downgraded to 'neutral.'
Tuesday's noteworthy upgrades include:
- Juniper (JNPR) upgraded to Overweight from Neutral at Piper Jaffray
- EOG Resources (EOG) upgraded to Buy from Hold at Deutsche Bank
- Valeant (VRX) upgraded to Overweight from Equal Weight at Morgan Stanley
- Tractor Supply (TSCO) upgraded to Neutral from Sell at Goldman
- Hyatt Hotels (H) upgraded to Buy from Neutral at BofA/Merrill
- Marriott (MAR) upgraded to Buy from Neutral at BofA/Merrill
This cost-containment company helps keep fraud and overpayments down while healthcare spending goes up.
By Jim Oberweis, Jr., The Oberweis Report
For a play on healthcare reform in this country, HMS Holdings (HMSY) is a small cap to own. The company provides cost-containment services for state Medicaid programs and other third-party payors by ridding the system of fraud and errors.
When it comes to spending, the rich aren't so different.
Tiffany reported that holiday revenue rose 7% to $952 million, fueled by double-digit gains in Asia along with smaller increases in Europe and the Americas. Same-store sales rose 4%, the New York-based company said.
With expectations low, a beat-and-raise quarter may be in the cards.
Aluminum giant Alcoa (AA) kicked off fourth-quarter earnings season on Monday by swinging to a deep net loss compared with a strong year-ago profit. And Alcoa's report was actually pretty good news. If the Dow component's results are any indication of things to come, a relatively lackluster earnings season could still provide a lift to stocks.
That's because even though Alcoa recorded a net loss, on an adjusted basis it matched Wall Street's estimate, according to data from Thomson Reuters. Even better, revenue came in well above analysts' average forecast, and the company said demand for aluminum is rising.
The reinvention of the iconic car is the first creation with truly integrated Chrysler and Fiat technologies.
Chrysler was already sputtering when the financial crisis hit, and the Great Recession caused the automaker to break down entirely. Only a partnership forged with Italy's Fiat allowed the once-great automaker to survive bankruptcy in 2009.
Merging the car companies has been slow and sometimes painful for both sides. However, American motorists will have their first real chance to explore what the Chrysler-Fiat partnership can offer with a blast from the past: a sleek redesign of the iconic Dodge Dart compact.
It is the first true test of shared platforms and technology. But will it sell?
The online game developer hasn't been able to match its IPO price lately.
The online game developer, known for its "Mafia Wars" and "FarmVille" franchises, saw shares drop 9% Monday to just $8 -- 20% below its IPO price of $10 a share.
Is Zynga getting a bad rap? After all, as Forbes points out, Zynga owns the top five games played on Facebook in terms of daily active users. About 95% of its revenue comes from Facebook, in fact.
The stock plunges despite the company's high subscriber growth, indicating the market believes the future is highly uncertain.
The company went public in June, and since then its stock has seen several ups and downs. While Pandora continued its rapid user growth over the course of the year, competition has intensified. Apart from being available online, Pandora has also launched apps for Apple's (AAPL) iPhone, Research in Motion's (RIMM) BlackBerry and other smartphones operating on Google's (GOOG) Android platform.
Bristol joins Gilead, Merck, Vertex, Roche and others in a race to treat hepatitis c.
The big drug maker Bristol-Myers Squibb (BMY) is shaking up the race toward a new hepatitis C treatment, entering a field that's already crowded with several top players. In a weekend announcement, Bristol-Myers said it will pay $2.5 billion to take over Inhibitex (INHX), a development stage drug company.
The $26 a share cash offer represents a 163% premium over Inhibitex's closing stock price on Friday.
The iconic Budweiser brand continues a long slide out of favor with American drinkers, falling to third place.
If Anheuser-Busch InBev (BUD) isn't panicking yet, it should be. This is the first time in nearly two decades that Anheuser-Busch hasn't controlled the top two beers in the country. The King of Beers is on its way to becoming court jester.
Budweiser has seen sales drop for years, and ran into serious trouble in 2009 and 2010.
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