Recovery? Not These Stocks Not all stocks in battered sectors will bounce back in a second-half economic upturn. Here are some that could be left behind. Recovery? Not for These Stocks - BusinessWeek
Egypt's Bread Lines Highlight Dangers of Food Crisis Well before 8 o'clock on a late April morning, a line of about 30 eager customers forms at a modest bakery in this working-class neighborhood. With a global food crisis roiling countries from Asia to the edge of Europe, at least 11 people have been killed recently in such lines here, struggling to get their daily bread. Tension in Egypt shows potency of food crisis - USATODAY.com
General Motors Corp. (NYSE: GM) reported a staggering $3.3 billion loss in its first-quarter, due in part to a weak U.S. market, a strike at a major supplier and plummeting sales of sport utility vehicles and pickups. While the loss amounted to $5.74 per share, GM's adjusted results are a loss of $350 million, or 62 cents per share, handily beating analysts' expectations of a $1.60 loss per share. Still, compared to last year, when the automaker had earned $62 million, or 11 cents a share, the results are far from stellar especially when considering that GM's revenue slipped despite being up 20% outside North America. GM shares are up about 3.5% in premarket trading.
Alcatel-Lucent (NYSE: ALU) also reported a loss Wednesday morning, its fifth straight quarterly loss and said it expected annual revenues to fall while scaling back its market forecast for 2008. Shares of ALU are down nearly 8% in premarket trading.
According to Fortune, AT&T (NYSE: T) is planning to cut the price by as much as $200 on Apple Inc. (NASDAQ: AAPL) iPhone when the new 3G model comes out this summer. Subsidizing the phone by that much will cut the price to $199 to for customers who sign two-year contracts, the Fortune source says.
I'm glad all these "blue chip stocks" are blowing up. No, I don't enjoy seeing investors suffer, but as I've written about here, here and here, investors need to learn not trust any company or anybody in this business. Investors don't even have to remain invested all the time! Contrary to the advice of fee-earnings-professionals, the majority of whom continually fail to match the S&P 500's returns, you don't have to manage your money like a $500 million mutual fund. Diversification is for widows and orphans!
While it'll probably take me a few years to truly get through to all of you, if you've been invested for any length of time in any company listed below-considering what you've been through-you're probably more likely to believe me:
Last week, I wrote one article about 10 stocks making new 52-week highs and another about 10 stocks making new 52-week lows. Gold, oil and steel plays made up the majority of stocks making new highs while technology and finance companies were the ones plummeting.
Both articles gave some very basic rules on how to spot reversals while recommending investors cut their losses quickly and let their winners run. And, both articles were released mid-week around the same time of day. Yet the article about stocks making new lows turned out to be more than seven times as popular!
Why do you think that is? Sure, they're slightly more actively traded, but I believe investors are not comfortable buying into or holding commodity plays because they've already gone up so much. But they're perfectly willing to go down with the ship on blue chip brokers and technology plays, sometimes even doubling and worse, tripling up because they're invested in such "quality companies."
Shares of communications equipment maker Ciena Corp. (NASDAQ: CIEN) have been surging today following announcing that its first-quarter profit more than doubled, helped by higher networking equipment sales. Its surprising earnings numbers and also a positive sales outlook gave a lift to the entire sector, whose shares have been rallying in early trading.
For the quarter, the company said that its profit rose to $28.8 million, or 28 cents per share as new products helped Ciena to "take share and gain additional customer traction." These numbers are up from $11.1 million, or 12 cents per share reported in the same period a year ago.
Included in the company's earnings figures was $7.7 million related to a patent litigation settlement. Excluding that, Sears earnings numbers would have come at $49.6 million, or 47 cents a share. Analyst, on average, expected the company show quarterly earnings of 40 cents per share.
Do two weak operations combined make a strong one? Motorola (NYSE: MOT) and Nortel (NYSE: NT) are considering putting their wireless telecom equipment operations into a company that would have about $10 billion in annual sales. Motorola is already considering spinning off its largest unit -- handset. According toThe Wall Street Journal, "if Motorola completes a deal with Nortel and divests itself of its handset business, it would be a much smaller company."
It is hard to see why the venture would work. In the same sector, the merger that created Alcatel-Lucent (NYSE: ALU) has been a first class disaster. The Nokia-Siemes telecom equipment operation says it has seen a slowdown.
Nortel's shares have fallen from a 52-week high of $31.79 to $11.07. The company has long-term debt of almost $4 billion and had operating income of only $63 million last quarter.
Otherwise, it is a swell idea.
Douglas A. McIntyre is an editor at 247wallst.com.
The once-vaunted FICO credit scoring system is now being blamed for failing to flag risky home-loan borrowers. The FICO score, last overhauled in 1989, is based on a complex formula using many variables --and yet it can be manipulated fairly easily by ordinary people. In the past few years a group of "credit doctors" and mortgage brokers began devising tricks, some illegal, to help borrowers juice their FICO scores to qualify for credit cards and mortgages on homes they couldn't afford. Will an overhaul be enough to appease angry lenders? Credit Scores: Not-So-Magic Numbers - BusinessWeek
Making Sense of Your Credit Score
Do you know your credit score? If so, you're probably well aware of how important it is to your finances. Unfortunately 70% of consumers don't know their score. It pays to know your number -- and how to boost it. Test your credit-score savvy with our QUIZ.
Macy's, The Limited and Ann Taylor Loft are out and T.J. Maxx, Marshalls and Ross Dress for Less are in.
The weaker the economy gets, it seems, the more some discounters benefit and the bleaker the outlook for their higher-priced competitors. The trend could carry long-term implications for all the retailers. People who try - and like - stores in shaky economic times are more likely to stick with them after the economy rebounds.
Stock futures were lower this morning, pointing to a weaker open on Wall Street this morning to end the week. Recession concerns following retail data from Thursday as well as a low consumer confidence level only served to aggravate those concerns further.
On Thursday, stocks snapped a three-day losing streak when as some bargain hunters moved in to pick up some stocks. The Dow industrials finished nearly 47 points higher, or 0.38%, the S&P 500 added 10 points, or 0.79%, and the Nasdaq Composite rose 14 points or 0.63%.
On the economic calendar today is only a December reading on wholesale inventories due at 10 a.m. EST. Atlanta Federal Reserve President Lockhart also is due to speak. Meanwhile, according to the RBC Cash Index, consumer confidence in the economy dropped further to a mark of 48.5 in early February -- the worse reading since 2002 -- from 56.3 last month. People fear shrinking job opportunities and the possibility the country is falling into recession. It seems that the Federal Reserve's easing policy and rate cut didn't serve to ease concerns, nor did the proposed economic stimulus package.
Speaking of the stimulus plan, Congress finally passed late Thursday a $170 billion economic stimulus bill. According to the package, most taxpayers will get rebate checks as soon as May in the amount of $600, while couples will receive $1,200 checks.
Armored vehicle maker Force Protection (NASDAQ: FRPT) has been slammed down to the single digits on fears that its sole product might be on the way out because of cuts in government spending. Who knows? The CEO says the company is doing fine, but the downtrending stock price is much more convincing. If the stock price is meant to make up lost ground, it should have no problem breaking out past $6, which it has not been able to do for the past few months. I'd avoid until the stock shows some strength.
Within the past few days, IDM Pharmacueticals (NASDAQ: IDMI) has had a huge run-up from under $1 to nearly $4 and a substantial drop to just under $2 -- all due to some positive drug news that was already known since November 2007, and of course the CEO's optimism about European approval. Do I believe the CEO? Yeah right! My distrust of CEOs is dwarfed only by my distrust of biotech CEOs! This company is not in the same league as other recently hot biotechs like Savient Pharmaceuticals (NASDAQ: SVNT) and Rigel Pharmaceuticals (NASDAQ: RIGL). Avoid, with a short bias on any spikes.
When I wrote this article about A-Power Generation Systems (NASDAQ: APWR), all the variables were aligned for a great run-up. I wanted to hold, but the volume and share price didn't live up to my expectations, so I sold quickly. Now, this company, potentially the new First Solar (NASDAQ: FSLR) of wind energy, has nearly retraced to its original breakout area around $15, so the risk has gone down ... but so has the reward. If you're a long-term investor, this is a solid choice, but I need it to break its previous highs at $19 to make me a buyer again. Avoid, with a long bias if it breaks out.
TheStreet.com's Jim Cramer says the News Corp. chief loves online, which makes his tone toward Yahoo! telling.
Does someone want to tell me the bull case for Yahoo! (NASDAQ: YHOO) (Cramer's Take) up here? After listening to Rupert Murdoch last night, who never met a dot-com he didn't like, I have to say that Yahoo is Microsoft's (NASDAQ: MSFT) (Cramer's Take).
Have no doubt that Congress will look at the efforts of Google (NASDAQ: GOOG) (Cramer's Take) to stop the deal and immediately recognize that this is about monopoly, with Google playing the role of Microsoft this time around.
I also find it hard to believe that anyone takes Yahoo! management seriously. Other than Alcatel-Lucent (NYSE: ALU) (Cramer's Take), I am hard-pressed to find a company that has done more to squander advantage, and in this case, Yahoo! had far more going for it than ALU from the start.
Here are some highlights from this past week's earnings coverage from BloggingStocks: 
I'm glad all these "blue chip stocks" are blowing up. No, I don't enjoy seeing investors suffer, but as I've written about 
Last week, I wrote one article about 10 stocks making new 52-week highs and another about 10 stocks making new 52-week lows. Gold, oil and steel plays made up the majority of stocks 
Shares of communications equipment maker 
Armored vehicle maker 
The Wal-Mart Weekly: Examining shareholder resolutions, Part 2
Earnings expectations for JC Penney, Nordstrom, Macy's, Abercrombie and others
Comfort Zone Investing: Financial stocks: Is the worst over yet?
