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.


After an 8% dive, value investors would be wise to snap up this bargain stock.

By InvestorPlace Mar 23, 2011 5:27AM

Walgreen Co. (WAG) took a nearly 8% dive after earnings Tuesday, but this drug store retailer may bounce back big-time across the next several weeks.

Here are three reasons investors should consider Walgreen a buy:


China's largest budget-hotel chain is interested in the market's No. 5, but the price is not right.

By Jim J. Jubak Mar 22, 2011 5:31PM
JIm JubakA rite of passage is coming soon for Home Inns & Hotels Management (HMIN), China’s biggest budget-hotel chain.

Morgan Stanley (MS) has put China’s fifth-largest budget hotelier, Shanghai Motel Chain, up for sale -- and like any good investment banker, it's trying to get a bidding war started. So far, Home Inns and France’s Accor hotel giant have expressed interest.

The initial price of $1 billion for Shanghai Motel’s 276 hotels and 40,000 rooms strikes me as steep. Outside analysts say a reasonable price is more like $400 million. (Morgan Stanley owns 59% of the chain. The bank is selling that stake and the 30% of the company owned by founder and chief executive Shen Feiyu.)

Can Home Inns show its management chops by either working the bid down or walking away if the price is wrong? Or will the company just go for the growth, no matter what the cost? What the company does will tell investors a lot about its maturity.

After ousting comedian Gilbert Gottfried, the insurer is looking for a new squawker. With video updates.

By Kim Peterson Mar 22, 2011 3:55PM
Do you have the voice of a frustrated, abrasive duck? Can you squawk the word "Aflac" at inopportune moments?

Then you might be the new star Aflac (AFL) is looking for. The company will start accepting submissions tomorrow for a voice to replace comedian Gilbert Gottfried. Aflac fired Gottfried last week for making crude jokes on Twitter about the disaster in Japan. (Gottfried has since apologized.)

With 75% of Aflac's business in Japan, the earthquake and tsunami are an especially sensitive subject. So now, the company wants a new voice for its duck.

Anyone can try out for the gig by making a 30-second audio or video clip of the famous Aflac squawk, the Associated Press reports. The file can be uploaded to www.quackaflac.com

Experts disagree on whether the strategy works for investors. With video updates.

By Kim Peterson Mar 22, 2011 3:32PM
Citigroup (C) investors weren't too thrilled with the bank's announcement Monday of a reverse stock split. The stock fell 7 cents a share and today is down by a penny to $4.43.

The 1-for-10 reverse split cuts the number of shares outstanding to 2.9 billion. Now Citigroup will reinstate its dividend to a whole penny. Big spender! The dividend will cost $29 million every quarter.

The reverse split could be a turnoff to some investors who like to own large amounts of cheap shares, The Wall Street Journal reports. And the stock could become more attractive to shorts who think there is more room to fall.

On the other hand, a higher stock price could attract more investors who aren't allowed to dabble in the cheap territory.

Post continues after this video discussing the bank:

The 3-day relief rebound hits a wall as the S&P 500 bonks its head on the 50-day moving average.

By Anthony Mirhaydari Mar 22, 2011 3:24PM

After last week's dramatic sell-off -- with the S&P 500 losing 3.6%, culminating with a washout on Wednesday -- the bulls have managed to string together a nice relief rebound rally. Monday marked the third straight up day. So that's it, right? With Japan's nuclear disaster coming under control and Libya's airspace filled with Western fighter jets, are stocks ready for another big uptrend?


Not quite. There are issues with the recent rebound. It came on light volume and disappointing breadth -- a sign that investors still aren't excited about stocks at these levels. And on all three days most of the gains came in the opening minutes of trading. The lack of intra-day follow through points to a lack of enthusiasm. Most importantly, key sector groups that have led the decline -- technology and semiconductors -- continue to lag badly.


Various technical and momentum indicators suggest this was a temporary reprieve within a medium-term downtrend -- a downtrend that's being powered by indications economic growth is set to slow.


Stocks are allegedly cheap now, at 15.7 times 2010 earnings. And they are cheap by historical standards.

By V.N. Katsenelson Mar 22, 2011 2:28PM

Profit margins are a tick away from all-time highs and are creating the impression of cheap equity valuations.   But that impression is a mirage, because today’s generous margins are destined to shrink.

I first wrote about this in January 2008, and here is an update to that article.  All I had to do was to update a chart and the numbers in the article and add a few comments – all of them are underlined.

Stocks are allegedly cheap now, at 15.7 times 2010 earnings. And they are cheap by historical standards. Only 10 years ago, their price/earnings ratios were double today’s; they are even cheaper if you compare their forward (2011) earnings yield of 7.3% to the 10-year Treasury yield of 3.40%. They are cheap, cheap, cheap!

Or so we’ve been told.


Only if Amazon is, too.

By Motley Fool Pick of the Day Mar 22, 2011 2:15PM

By Tim Beyers


Some days, watching the tech news cycle is like watching a soap opera. The Web is abuzz today with news that, on Friday, Apple (AAPL) sued Amazon.com (AMZN) for violating its trademark on the term "app store." Amazon's using the term to describe the digital market for Android apps that it's launching today.


On the surface, the suit seems loony. Don't we all use "app" and "app store" as generic terms? With each, we're describing broad concepts. Sure, iPhones have apps --  but so does every other smartphone out there. And where do we get these apps? App stores, of course. Even Steve Jobs says so. Microsoft (MSFT) has filed a petition to invalidate Apple's app store patent precisely because of our propensity to use these terms in common speech.


But don't be too quick to burn your mock turtleneck in protest. Amazon.com may have opened this particular can of worms when it patented "one-click checkout" more than a decade ago. Apple has since licensed the term for use in its own digital stores.


Investors love JPMorgan's role in the AT&T acquisition of T-Mobile, and one prominent analyst says the bank could eventually net $500 million on the deal.

By TheStreet Staff Mar 22, 2011 1:22PM

thestreetBy Philip van Doorn, TheStreet


As Wall Street digests AT&T's (T) agreement to acquire T-Mobile from Deutsche Telekom AG (DTE), excitement is brewing for the potential fee and interest income JPMorgan Chase (JPM) and other players can earn from the merger and from subsequent deals.


AT&T agreed to pay $39 billion -- including $25 billion in cash - with reports indicating that JPMorgan had provided AT&T a $30 billion line of credit. Richard Bove of Rochdale Research said that the reports suggested that JPMorgan didn't "syndicate this credit because AT&T did not want any word of its potential bid to leak out."


If this is indeed what has taken place, Bove estimates that JPMorgan's fee for the credit line could be as high as $150 million.


The social-networking site plans a $175 million initial public offering this year. With video updates.

By Kim Peterson Mar 22, 2011 1:19PM
LinkedIn, the social-networking site focused on business relationships, hit 100 million members this week. That's good news for the company as it heads into its $175 million initial public offering.

The site adds about 1 million members every week, the company said in a blog post. More than half of its members are outside the U.S., with the fastest growth coming from Brazil, Mexico, India and France.

Of all the major social-networking sites, LinkedIn is the one I use the least. But other people seem to like it. The company says nearly 1 million of its members are teachers, 1,030 are chocolatiers and 74 are "Elvis tribute artists."

Post continues after this video about LinkedIn and other networking sites: 

The company hopes its PlayBook will make a splash in a market dominated by Apple's iPad. With video updates.

By Kim Peterson Mar 22, 2011 12:58PM
Research In Motion (RIMM) has finally announced a date for the launch of its highly anticipated tablet.

The PlayBook will be available April 19 in North America. The Wall Street Journal calls the device the "most important launch in years" for RIM, which also makes the BlackBerry line of smartphones. It will cost between $499 and $699, depending on the bells and whistles.

Why is the PlayBook so important? Because after years of trying to court consumers, Research In Motion is losing significant market share in North America. The competition has simply been too fierce, with Apple's iPhone and a host of new phones based on the Android platform from Google (GOOG) stealing customers from the BlackBerry.

Post continues after this video discussing the tablet wars: 

The airline has raised ticket prices 6 times this year, but that seems not to have dented business much. With video updates.

By Kim Peterson Mar 22, 2011 12:13PM

Higher airfares are a bummer, unless you're the chief executive of Southwest Airlines (LUV). Gary Kelly said he's had "delightful success" bumping up ticket prices to pay for higher fuel costs.

I doubt any of Southwest's passengers would describe the higher fares as delightful, but the price hikes didn't keep them away. In fact, Southwest's passengers flew 13% more in February than a year earlier. That's why Southwest isn't ruling out future fare increases, The Associated Press reports.

"We've had six fare increases so far this year. That's a lot in 90 days," Kelly said at an investor conference, the AP reports. "On the other hand, our traffic has held up more than well -- it's been very, very strong."

Post continues after this video analysis of Southwest's recent earnings:


A lot has changed in the past 3 months. Here are the best stock opportunities for the second quarter.

By Jim Cramer Mar 22, 2011 7:24AM

Jim CramerWhen we zoomed into the first quarter, we had a multi-cylinder market.


Smart devices were powering a tech boom. Big exporters were taking advantage of robust economies in East Asia and a renewed Europe that seemed to put its troubled finances behind it. Banks, having paid back TARP, were ready to return capital. Health care, freed from the cloud of regulation, seemed ready to take off.


What a difference three months can make. European debt concerns resurfaced, and interest rates have climbed ever higher in Portugal, Greece and Spain. North Africa and the Middle East played dominoes, started by political uprisings in Tunisia that dropped into Egypt and then headed for Bahrain and Saudi Arabia before landing in Libya, driving oil up to $100 a barrel in their wake.


T-Mobile users are up in arms about the proposed acquisition. With video updates.

By Kim Peterson Mar 21, 2011 3:02PM
AT&T (T) and T-Mobile. Was there ever a deal so universally reviled? People across the board are holding their noses at this proposed $39 billion marriage.

"It's hard to find winners, apart from AT&T and T-Mobile shareholders," Om Malik writes on the GigaOM technology blog. The biggest losers in the deal, he says, would be consumers. That's because T-Mobile has offered cheaper voice and data plans and because the market would have only three main national players: AT&T, Verizon (VZ) and Sprint (S).

Phone handset makers would also lose, Malik writes, because there would be one less carrier that would buy GSM-based phones from shops like HTC and Motorola (MSI).

T-Mobile customers are up in arms. Having your carrier acquired by the worst cellphone company in the U.S. wouldn't make anyone happy.

Post continues after this video of the head honchos at both companies defending the deal: 

Be more bullish about the broker if it can seal the deal.

By Motley Fool Pick of the Day Mar 21, 2011 1:54PM

By Rick Aristotle Munarriz


Sector consolidation is back among the discounters in the brokerage space. Charles Schwab (SCHW) is buying optionsXpress (OXPS) in a deal that's valued around $1 billion.


The leading discount broker is offering 1.02 shares for every share of the options trading specialist. The value will fluctuate as Schwab's stock goes up and down, but it was a 17% premium based on Friday's close of both equities.


It's a great deal for Schwab. It's nabbing a rising star in options trading at the right time and at a small premium. The same can't necessarily be said for optionsXpress. Its shares traded as high as $21.07 just three months ago. Why is it cashing out for less than $18 based on the initial deal?


The nation's largest retailer has been in a nerve-wracking US slump. Can it revive its sluggish business? With video updates.

By Kim Peterson Mar 21, 2011 1:48PM
Credit: (©Mel Evans/AP)
Caption: Wal-Mart StoreThe economy is slowly coming back to life, but you wouldn't know it by looking at Wal-Mart (WMT).

The nation's largest retailer has stalled, unable to climb out of the worst U.S. sales spiral in its history. For seven straight quarters, U.S. sales have dropped -- an alarming trend that the company is scrambling to break.

The company made some bad calculations, particularly as the economy was heading downhill. The stock has been a nonperformer, dropping nearly 6% in the past year to $51.89. Its three-year stock performance isn't pretty.

What went wrong at Wal-Mart? Here are four huge problems that the company needs to address: 


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[BRIEFING.COM] The stock market maintained a narrow trading range on Thursday before ending the session essentially where it began. The S&P 500 added less than a point, while the small-cap Russell 2000 (-0.2%) underperformed.

Equity indices displayed early strength thanks in part to an overnight boost from better than expected economic data in China and Europe. Specifically, China's HSBC Manufacturing PMI surged to an 18-month high (52.0 from 50.7), while Eurozone Manufacturing PMI ... More


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