Facebook’s Untapped Potential for Long-term Growth
With Facebook’s stock price flirting with all-time highs these past few weeks, investors are naturally inclined to ask the question: when will the gains stop? Not anytime soon. Just last quarter, Facebook’s number of average monthly users climbed to a spectacular 1.32 billion and revenues went up 61%. On top of that, all evidence points toward similar advances to be seen in its Q3 earnings report due out next week. A majority of Facebook’s ad revenues came from mobile users, who are more likely to purchase any products or services advertised than their traditional PC-using counterparts. With new mobile video ads being tested and constantly improving ad targeting algorithms, Facebook’s ad revenue is more than likely to keep growing. However, these recent developments are only the tip of the iceberg: Facebook is holding onto many unutilized acquisitions and has not even tapped into several of its revenue drivers. With much potential for future long-term growth, Facebook makes the perfect company for investors to follow over the next decade.
PetSmart: Not the Smartest Company to Invest In?
PetSmart, Inc. is the largest retailer that specializes in pet products and services. The company has approximately 1,352 pet stores in the United States, Canada, and Puerto Rico. Not only does the retailer sell pet care products, it also offers dog and cat boarding facilities, online pet care information, dog training, pet grooming, dog day care services, and pet adoption services. Through PetSmart Charities, the company saved the lives of over 5.7 million pets since 1994 and donated $34 million in 2013. Although PetSmart is with no doubt a very generous retailer, is its business generous towards its stock holders?
Today, Deutsche Bank upgraded PetSmart, Inc. from sell to hold, increasing the price target to $74 from $60. The firm has stated that PetSmart’s stock has underperformed so far and has several catalysts that could support shares, but the company is still fundamentally challenged. The retail stores seem to have a little trouble competing with new online retailers. Despite PetSmart, Inc. having improved earnings per share by 10% from last year, the company is still underperforming compared to the industry average. Private equity firms are expected to bid on the company. This could help develop new strategies for the company, which will allow for continued growth in spite of increased competition.
New Disney Movies Lead to Increased Revenue
The Walt Disney Company has been earning more per share this year than it ever had before. Just last quarter, the company earned a record high $1.28 per share, which beat analyst expectations by $0.11 per share. Additionally, the fourth earnings report released just today showed that total revenue has risen to $12.39 billion from just $11.57 billion last quarter. As a result, Disney’s stock price is up 4.5% from three months ago.
Investors attribute Disney’s strong financial growth to its pipeline of new products to be released over several years. In late September, the entertainment company premiered an hour long animated Star Wars movie online to build up hype for its upcoming Star Wars movie, which is scheduled to hit theatres in December 2015. Also, Disney added Star Wars themes to its amusements parks and plans to sell more Star Wars toys. The Star Wars franchise is likely to generate a lot of revenue, but Disney has plenty of other brands to profit from. For example, the movie Frozen, which was released last year, is still making the company tons of money through huge sales of related consumer products.
With so many products to generate money from and a huge budget to build marketing hype, The Walt Disney Company is very likely to see continued growth for many years to come.
Time Warner on the Rise with Streaming HBO Service
Time Warner Inc. has just experienced one of its best yet: revenue rose 3% to $6.24 billion, beating what Wall Street had estimated for the company’s third quarter earnings. Consequently, shares went up 3% ($2.22) today. Taking into account that last year’s full year earnings were $3.51, it appears that Time Warner’s stock price is rising rapidly in light of new company strategies. Successful TV shows and a new subscription video-on-demand service boosted revenues last quarter. Several of Time Warner’s subsidiaries announced that they were implementing cost-cutting initiatives, such as decreasing their global workforce. The company also rejected an $80 billion takeover offer from Twenty-First Century Fox Inc., driving up the stock price even further.
Last month, Time Warner stated that HBO will launch a standalone online streaming service next year. This will make many of their hit shows available to a much wider customer base, many of whom refuse to pay for traditional cable subscriptions. The majority people who watch HBO shows watch them on-demand as opposed to watching them when they first air on cable. Therefore, the new streaming service will appeal greatly to a wide range of new consumers.
By constantly airing successful TV shows, cutting costs, and appealing to a larger group of customers, Time Warner Inc. is more likely than not to drive its shares up dramatically over the next few years.
Sony Corporation: Can the company make a turnaround?
Sony Corporation has been suffering huge losses for quite some time now. Sony has lost tens of billions of dollars these past five years and just last quarter, the company lost a whopping $1.2 billion. Sony has had much trouble competing with other hardware vendors in selling PCs, TV sets, and other multimedia devices. It even had to drop out of the PC industry completely. However, the company is now focusing on its mobile division, which has finally shown some promising signs of profit. With Apple Inc. leading global cell phone sales and Samsung Group dominating the Android OS market, Sony will have a hard time establishing itself in the industry. On top of that, Sony’s mobile lineup suffers from in-house fragmentation, which means that there are so many different models of Sony Xperia devices that none really gain any recognition amongst the customers.
Sony’s biggest source of revenue growth this year came from sales of its new Playstation 4. Despite this fact, the company is still projected to lose $468 million for the financial year. Additionally, Microsoft Corporation surpassed Sony with sales of its own Xbox One just last September, indicating that Sony’s revenue-boosting Playstation sales are coming to an end. With few hopeful sources of revenue and diminishing video game console sales, it is too early to say whether Sony Corporation will make it out of this slump or become just another antiquated and irrelevant company.
Coca-Cola Releases Yet Another Low Calorie Drink, Stock Price Predicted to Rise
In a report from Nomura last Wednesday, Coca-Cola Co. maintained its “buy” rating and was given a price target increase from $51.50 to $54. As a result, the company’s stock price rose considerably, up to $41.94 today compared to $40.73 just last week. Nomura analysts stated that the strategic initiatives announced two weeks ago was the primary reason for their positive report. They believe that these new strategies will outweigh the drawbacks that Coca-Cola Co. will experience as part of the beverage industry, which has been seeing declines in revenue over the past few years.
Today, Coca-Coca Co. released a new reduced calorie drink, Coca-Cola Life. Following the announcement, Coca-Cola shares fluctuated a little bit but are currently up 0.31%. The new drink is different from the company’s other low calorie beverages, Diet Coke and Coke Zero. Both Diet Coke and Coke Zero use the artificial sweetener aspartame, which has shown damaging to both physical and mental health. Coca-Cola Life, however, uses real cane sugar and stevia leaf extract to achieve its sweet taste. In light of rising health concerns, Coca-Cola Life will surely draw the attention of consumers who want a natural low calorie alternative to their favorite carbonated drink. In the future, Coca-Cola Co. plans to release an at-home soda machine, directly competing with SodaStream for its rapidly expanding customer base. With better financial strategies and new product releases that appeal to the current generation of more health-aware individuals, Coca-Cola Co. shares are likely to rise in the long term.
March 24, 2014
Coca-Cola: Healthier options, at-home vending machines, 2020
Coca-Cola Co. products consumers in developed countries are shifting away from sugary soft drinks and towards healthier options, creating losses in profits for the beverages manufacturer. Furthermore, Mexico, the world’s largest consumer of Coca-Cola products, recently introduced a tax on sugary beverages, discouraging buyers and further decreasing profit.
To combat the preference change for healthier options, Coca-Cola Co. has begun producing more tea, water, and juice products containing fewer calories and artificial ingredients. In addition to product diversification, it seems the market for Coca-Cola merchandise is preparing to expand with plans to develop home soda machines as part of the company’s “2020 Vision”, a roadmap for increased growth for the remainder of the decade crafted after a 3% decline in shares last year.
The plan is composed of six facets (Profit, People, Portfolio, Partners, Planet, and Productivity), pledging better performance in shareholder investment, workplace diversity, brand health, commercialization, retail growth, safety, and energy use. As of now, Coca-Cola's 2020 Vision aims for an annual income growth increase to about 6-8%.
March 13, 2014
PetSmart: Forbes magazine rates PetSmart a ‘buy’
Most store retailers faced losses in shares late last year. SinceOctober 2013, PetSmart has seen a 19% decline. The pet products distributor is experiencing slow growth in light of the growing preference for online shopping. Earlier this year, analysts at Deutsche Bank downgraded PetSmart stock, and shares decreased an additional 10% as a result.
In the past, PetSmart managed to withstand competition from online retailers without sustaining much damage. Selling pet food online at a discounted price generates little to no profit, and buyers are more likely to purchase pet food from stores rather than the cheaper foreign-made food brands sold on the Web.
PetSmart has a reliable foundation of consumers, as they can always count on pet-owners feeding their animals. The fact that pet food has to be purchased regularly favors PetSmart, and their expanding services in 2014 could lead to increased growth.
March 7, 2014
Sony: Big Losses for Sony Corp.
After a long struggle, Sony Corporation is finally getting out of the PC business. The company has been in steady decline for the past decade, as consumer interest in PCs has fallen substantially. After the recent rise in public demand for smart phones and tablets, Sony continued to manufacture PCs instead of jumping on the mobile bandwagon, resulting in an additional 10% loss in profit.
Sony remains consistently strong in TV sales, but is not the leading TV manufacturer in the world, having lost $7.5 billion in the industry to the South Korean Samsung Group. Even the extremely popular game console PlayStation, with the recent launch of its fourth series the PlayStation 4 (PS4), won’t generate enough revenue to make up for expected losses due to failures in the PC industry.
Researchers estimate anywhere from $300 to $400 million in losses for Sony in 2014, and a decrease in shares. Due to Sony’s belated decision to stop producing PCs and shift to more populardevices, Apple, Samsung, LG, and many other competitors have far surpassed Sony in consumer electronics, making them much safer investment options.
February 6, 2014
Disney: Box-Office Hit 'Frozen' Unfreezes Disney Shares
The Walt Disney Co. experienced a dramatic increase in stock market value due to the family hit ‘Frozen’ released late last year. Shares jumped 3.9% from $71.76 to $74.52 on Wednesday. This large success comes in the wake of several box office failures earlier last year that caused Disney shares to fall far below the market average. Future prospects for Disney look promising as they continue to profit off of merchandise produced from the film.
Furthermore, reports indicate that Disney is close to a settlement with Dish Network Co. (DISH) after filing for a lawsuit that claimed the satellite service provider’s ad-skipping technology was affecting Disney sales, entitling Disney to financial compensation. If the court forbids DISH from using the technology, viewership of Disney ads will increase, and potentially their shares as a result.
February 6, 2014
Facebook: More Ads Lead to Greater Shares
Facebook shares grew 16% by last Thursday, January 30th, after recent decisions to sell ad space on the website’s mobile app. Shares reached an all-time high of $62.30 on Thursday, almost double their worth in 2012. As more and more people rely on their smart phones for internet access, companies like Facebook and Google are making changes to their marketing. Researchers believe that by 2017, 4 billion people worldwide will be accessing the internet via their mobile phones.
The Facebook-owned Instagram debuted its first ad space on the app late last year. This is believed to be the source of the company’s booming growth. Investing in Facebook this year is a smart and safe move. However, investors should remain cautious, as recent data suggests that fewer and fewer social networking users are on Facebook or Instagram, and instead opt to use other mobile messaging services, such as snapchat.
December 2, 2013
Disney: Will Cyber Monday make up for a Disappointing Black Friday?
Today, Disney Cyber Monday sales event has begun, which entails 15% off online orders over $50, as well as free shipping for those who spend $75 or more and use the code CYBER on the website. In addition, many products have been discounted. The Disney Store is even offering the option for online customers to send personalized video messages with email notifications to gift recipients. Like most other companies, Disney is attempting to catch those who missed out on their “Magical Week” Black Friday sales.
Despite what the long lines and traffic suggest, this year’s weekend sales results actually failed to impress most industries. Shoppers spent an estimated $407 over the holiday weekend, on average, down from $423 last year. Even though Black Friday may not have gone as planned, the box office certainly held its ground for Disney over the Thanksgiving holiday. The huge opening of Frozen grossed at $66.7 million in its debut. Frozen is not a Pixar film, but an in-house animation. Since Pixar will not be releasing a movie next year, it is good for Disney to see that this type of movie can succeed instead.
November 26, 2013
Electronic Arts: Damage Control
Earlier this year, Electronic Arts gained the dubious title of the “Worst Company in America” for the second time in a row. Since then, CEO Andrew Wilson has attempted to respond to criticisms openly and fix problems as quickly as possible. Unfortunately, this has not been easy, as numerous problems have arisen related to the company’s launch line-up on Xbox One and PlayStation 4. For example, there was an error with corrupted files and deletion of data in the new Battlefield 4 that led many users to believe EA had shipped a broken game for the PS4. To make matters worse, Chief Operating Officer Peter Moore replied to Twitter feedback by simply denying all errors with the game. Now enacting damage control, CEO Wilson announces that EA hopes to accelerate game updates, some of which will improve the way that new gameplay controls are taught.
Besides criticisms from gaming fans, EA is facing a fresh lawsuit from the National Collegiate Athletic Association (NCAA). Back in the summer, the NCAA had announced it would no longer license video games, leaving it to members to decide whether or not they would continue to appear in EA Sports’ college football series. Now, the NCAA is claiming that EA only compensated college athletes for the legal claims made by them. The entire situation became even more complicated when students disputed with the NCAA over shares of the revenue from use of their images in the games. Due to obvious risks, developers have decided to cancel NCAA Football 2015 and EA hopes to keep the strength of their portfolio with other popular items, such as Madden NFL and FIFA 14.
November 26, 2013
TWX: Breaking from Magazines, Merging with Comcast?
Time Warner, Inc. has received a lot of publicity lately, especially after CEO Jeff Bewkes filed on November 22, 2013 to split from its Time, Inc. division beginning in 2014, though he did not specify dates for the spin-off. Time, Inc. has reportedly performed worst in sales for TWX. Indeed, their debt has cost the company three times the annual operating income of TWX (about $1.2 billion), making it the biggest laggard among Time Warner’s divisions. The fall in sales for Time, Inc. began as far back as seven years and the unit’s revenue has continually fallen in a total of five years since then. According to Bewkes, separating the magazine unit from Time Warner, Inc. will help protect the company’s assets against difficulties it has faced with transitioning in publicity both to the Internet and lower advertising rates.
Despite the decline in sales from Time, Inc., TWX posted higher earnings on continued growth in broadband services and a higher average revenue per user this past quarter. However, the company is still struggling to gain (or keep) video subscribers, similar to almost any cable company in the current media landscape. In order to break the trend away from cable, John Malone (head of the cable industry) has recently proposed an elaborate consolidation of companies. To begin, he has gained support from Comcast to buy Time Warner Cable (its biggest rival). While this seems like an incredible idea since the resulting massive cable operator would greatly outnumber the next largest cable service provider in customers, Comcast and TWX would actually only control 28% of the TV service market together and smaller operators would definitely keep the cable industry alive if the merger fails.
November 11, 2013
Sirius Attempts to Gain Greater Revenue Via the Auto Industry and Popular Celebrities
Sirius XM Radio has had a busy week. On November 7, the company broadcast its new deal with Chrysler, whereby for each of their 2014-model vehicles (Chrysler, Jeep, Dodge, Ram, SRT, Fiat, or Mopar) that is equipped with satellite-radio Uconnect infotainment systems, Sirius will provide more than 150 of their radio stations, as well as Web-based Internet service, free for a year. Additionally, Sirius has recently completed its purchase of Agero’s Connected Vehicles Services Division, which should accelerate the company’s move towards vehicle telematics (dealing with GPS navigation, integrated hands-free cell phones, or other driving assistance systems). Since Sirius has already benefitted from rising automotive sales, so their continued effort to offer security and convenience for new auto buyers should produce more business for them.
Last Friday, Sirius hosted an exclusive interview with Lady Gaga about the new app she is launching with the release (today) of her new studio album, Artpop. Furthermore, the company announced that it would be holding a birthday bash for its most popular on-air celebrity, Howard Stern, sometime in January, even though he most likely will not return and will undoubtedly take some subscriptions along with him. Although this continent only contributes 50% of the global radio revenues, Sirius is the leading radio broadcasting company in North America, and also operates in Canada. Both regions are improving to help improve revenue in the future. Overall, Sirius has underperformed the S&P 500 in the previous three trading sessions, but advanced on Friday.
November 6, 2013
Due to Weak Quarterly Results, Sony Launches New Products and New Fees
Leading up to the huge PlayStation 4 reveal on November 15 (in North America), Sony Corporation announced a live stream event, aired by Spike TV, on the night before to catch those waiting in New York City for the console. During this broadcast, it is rumored that the company will also disclose a number of new games for the PS4, so that both casual and “hardcore” gamers should tune-in. Sony has already answered some issues customers have had with Microsoft’s Xbox One, such as the online requirement (with the PS4, one may request a disc that will allow for activation through a Blue-ray player). In addition, there is a new technical feature that makes it possible for PS4 gamers to play alongside PS3 users in a cross-platform scenario.
Besides excitement in the gaming world, Sony has also launched several new camera products for photography fans, including one with high functionality under-water as well as two lens attachments for smartphones. Based on recent efforts, Sony has responded well to weak consumer spending, which has driven sales and profits lower. At the end of October, SNE reported worse quarterly results than were expected and the S&P in turn lowered their price target. As a final attempt to increase profit, the Corporation declared a new monthly fee for multiplayer online PS4 games and a proposal for a yearly base membership fee at $49.99 (lower than $5/month).
November 5, 2013
"It's not me, it's you": Coca Cola Refuses to Change for Consumers, but Willing to Expand into New Markets
Currently in the US Beverage Industry, companies are concerned about increasing obesity awareness and studies linking poor health with soda consumption. Coca Cola recently admitted that sales of Diet Coke were down 3% last year due to worries about the artificial sweetener aspartame. However, KO does not believe they should use claims made by the National Health and Nutrition Examination Survey in their policy decision-making.
Instead of changing any of their soda products, the company has embraced their new products and means of selling them. At a show for the National Association of Convenience Stores, Coca Cola proposed a Vitaminwater fountain dispenser, which would make it easier for consumers to drink. In addition, they have introduced a line of flavored Dasani sparkling bottled waters for those wanting a healthier tasty drink. Finally, Coca Cola also provides Honest Tea and Fuze drinks for more health-conscious consumers.
Besides expanding their products, the company now has a $4 billion, three-year investment plan in China. Last Thursday, KO opened their first bottling factory in the key Hebei province, where there are the most important growth markets due to the province’s size (72 million residents--6th largest in China) and its admiration of Coke (having consumed 2.4 billion servings of the company’s products each year since 2008). Due to increasing health concerns in the US and some other countries, both Coca Cola and their rival PepsiCo, Inc. are counting on emerging markets like China and India, where middle classes are rapidly expanding.
October 30, 2013
Facebook Experiments with New Advertising Methods for Unsatisfied Marketers
Recently, Facebook’s stock has seen an incredible increase in value since it began expanding its advertising domains (via both television and mobile devices). However, some of the company’s advertisers are now concerned that the social network is simply a “massive display-ad platform,” which does not help marketers gain any new consumers. Indeed, some fear that Facebook does not care to appease its marketers due to their enormous revenue regardless. If they fail to change, though, other social networking websites (e.g. Google, Twitter) are likely to “fill the gap” as better advertising channels.
Clearly, the company is still experimenting with new targeted advertising methods. Reported in the Wall Street Journal today, Ken Rudin explained a new system which would target ads based on where users’ mouse cursors hover for a certain amount of time. Additionally, this new program indicates when mobile users are checking their news feeds. While such tracking technology is not new, the company could potentially collect an unprecedented amount of behavioral data, just based on how many users the site currently has (almost 1.2 billion). Nevertheless, Facebook will not actually decide on whether or not they will implement the system for another two months (at least).
October 23, 2013
Ford CEO Stops Inventory Production for Two Weeks
In spite of expectations, US auto sales recently dropped for the first time in 27 months. As reported on October 7, Ford Motor Company’s cars have sold especially well this year, in addition to their growing truck sales. Considering their recent success, in which they had profit margins at double even a respectable amount, CEO Alan Mulally decided to take a step back so as not to “get ahead of themselves.” Therefore, the company scheduled a pause of inventory production for two weeks (between October 28 and December 16).
Specifically, Ford aims to cut back on the manufacture of the Focus compact and C-Max hybrid cars. Currently, these two vehicles are already in excess of supply worth, since typical auto companies try to have enough of each product for sixty days (these are at 71 and 122 days, respectively). According to Detroit News, high inventory levels should not be a major concern since Spring is the most popular time to buy small cars. Fortunately, it appears that while the factory is closed, most workers will still receive pay (though approximately 5,000 will have nothing to do before production begins again).
October 14, 2013
Safeway Sells Stores in Chicago and Canada
Last Thursday, Safeway Inc. announced its plans to leave (by early 2014) Chicago, where it currently holds 72 Domenick’s supermarkets, worth a $400-$450 million cash tax benefit. The city is famous for having a competitive food-store market, with numerous places both for higher-end shoppers (e.g. Roundy Inc’s Mariano’s chain) and for those more cost-conscious customers (e.g. Aldi Inc, Wal-Mart Stores Inc, Target Corp). Due to this competition, the Chicago Domenick’s chain has significantly drained the company’s resources since opening in 1998. Indeed, its net income fell to $65.8 million in the fiscal third quarter (that ended on September 7) compared with $157 million in the previous year. Safeway Inc plans to sell all of the current stores, but has currently only managed to sell four to Jewel-Osco, a rival chain which in March also picked up stores from Supervalu Inc.
In addition to this strategic move, Safeway Inc has decided to close the sale of its Canadian operations to Empire Company Ltd during the fourth quarter. Earlier this year, the company went public with its Blackhawk Network Holdings Inc gift card business, in which it still holds a controlling stake. With the cash tax benefit from the disposal of Chicago, Safeway Inc can buy back stock and invest in new growth opportunities. Even though the last quarter disappointed, most research analysts agree that the future looks promising for the company and their stock target price will continue to rise.
October 10, 2013
Sirius XM Announces Details about New Stock Repurchase Program
Today, the Board of Directors at Sirius XM Radio, Inc. approved details about its new $2 billion stock repurchase program. The Company announced its decision to buy $500 million of common stock from Liberty Media and its affiliates in three installments over the course of November 2013-April 2014. This will complete their original stock repurchase program, by raising their total aggregate purchase price for shares of common stock from $1.6 billion to $2.1 billion.
One may wonder how they plan to pay for all of this. While it may seem risky, the funds will come from free existing and future cash flow, of which the Company is targeted at $915 million worth for this year alone. Since Sirius seems to regulate its programming costs much better than other content broadcasters, each new subscriber actually brings them more value than the one before. Basically, as long as people continue to listen to the station, then there will be room for generating more money.
Overall, the new program reflects the Board’s continued desire to return value to stockholders. In the future, Sirius XM shows promise for long-term growth. By making enduring investments in programming, research, and development initiatives, the Company can be confident in its pursues for more strategic opportunities.
October 7, 2013
Ford Beats GM in Truck Sales and Improves Cars to Compete with Honda and Toyota
The F-series light truck has been America’s best-selling vehicle for 36 consecutive years, but some at Ford worried recently about rising competition when rival GM (General Motors) launched several new models. However, during September, Ford had an increase of 9.8% in truck sales, while GM reported a decline of 10.8% in Silverado sales. Besides trucks, Ford dramatically improved its cars over the last few years in order to face pressure from companies like Honda and Toyota. For example, the Ford Fusion, which was named "Green Car of the Year," "Best Car for Families," and "Best Car for the Money,” has done a great deal to improve consumer’s perception of the brand’s manufacturing quality. In response, the Toyota Camry and Honda Accord saw sales declines of 7% and 13.7% respectively, from September 2012-2013.
By diversifying their product, Ford is providing extra sources for future expansion. Their stock is up by more than 33% in 2013; in the last 12 months alone, it is up by 75%. Though some investors are wondering whether this increase has already gone too far, most recognize that Ford is still inexpensive when compared to industry peers. Investors also have good reason to expect growing dividends from the company, since they doubled their payments to $0.10 per share in 2013 and still have a relatively low payout ratio of 19% of earnings.
Generally, for various reasons, US auto sales are expected to reach 15.5 million units by the end of 2013, leading to a 7.5% increase from year to year. Besides considering stock in Ford, one should keep in mind how this will affect the revenue growth of Sirius XM and other similar satellite radio companies.
Sony’s (SNE) PlayStation 4 (PS4) is set to be released on November 15. This next generation counsel will come in direct competition with Microsoft’s Xbox One, which will be available starting November 22. A recent online survey conducted by Reuters predicts that the PS4 will outsell the new Xbox, with 41% of people under the age of 40 saying they were more likely to buy the PS4, compared with just 27% for the Xbox One.
The PS4 is the first game counsel that Sony has released since the PS3 in November 2006, while the Xbox One will be Microsoft’s replacement for the Xbox 360, which came out in November 2005. The only “next-generation” game counsel currently on the market is Nintendo’s Wii U. The PS4 will sell for $399, whereas the Xbox One will cost $499. Sony is expected to lose $60 for every PS4 it sells, but they hope to overcome this with the profits they make on selling games and subscriptions. Microsoft, however, is hoping to come out even or slightly ahead on each Xbox One unit it sells. Does this product comparison make you want to buy stock in Sony before the PS4 comes out?
Electronic Arts (EA) has come to a cross-road of where to take its business plan as the gaming industry continues to evolve. With a large portion of revenue shifting to mobile gaming, EA needs to increase its position on this side of the market to further capitalize on the shift. The new gaming environment can be analyzed by looking at the mobile game developer King, which created the popular app Candy Crush. This game generates an estimated $850,000 per day for King, with over 7.5 million active users. This figure from just one game surpasses EA’s entire mobile user base. But EA should be careful, because taking a look at a company like Zynga shows the downside of this industry. Originally successful for generating revenue by putting games on Facebook, Zynga’s user base is now shrinking rapidly, and its stock price has suffered accordingly. Zynga proves how hard it is to stay relevant on the mobile platform, where new games (which are often free) are constantly being developed and released.
Transitioning away from the game console market may also be a mistake for EA. The strength of this part of the gaming industry was proven last week when Grand Theft Auto V was released, which generated a record $1 billion by selling 15 million units in just the first three days. But EA’s most recent mobile release, Plants vs. Zombies 2, also showed early success, with 16 million downloads in the first five days. EA is also reportedly going to be releasing an additional 15 titles in the next 12 months. Their ability to generate strong revenue from both sides of the gaming market will be the determinant of where their stock price will go.
Even if you don't currently have a Facebook page, you most likely know a lot of other people who use the site daily. Indeed, today's social media popularity has made it so that, without a Twitter or Facebook, one almost ceases to exist in the world - or at least loses contact with most of it. The average Facebook user now has 303 friends, up from a mere 126 in 2009. Unfortunately, this inflation has transformed the site (and others like it) into a commercial network, where personal connection is limited and advertising is unavoidable. While it may be annoying, such advertising is certainly helping the company's stock position.
Though stocks in Facebook will not be considered "cheap" probably anytime in the near future, the company has been raising its revenue recently by both partnering and competing with television. First, it allied with Trendrr, a platform to track what people are saying about televised ad campaigns. Secondly, Facebook has been trying to catch up with Twitter in creating hashtags and other tools so that user discussions can pop-up, prime-time on-air. At the same time, some believe the days of sitting in front of the TV, being a couch potato, are behind us. If this is true, Facebook is definitely ahead of the game with its mobile advertising. (Just last quarter, the company generated more than 41% of its ad revenue from mobile.)
Through its use of multimedia, Facebook will undoubtedly continue to grow - the only question is how fast. The company has certainly entered "corporate adulthood," as CEO Mark Zuckerberg is becoming an esteemed business leader and making his name known in Washington. Even if growth is slow, Todd Schoenberger of LandColt Capital says that the site has its best days in front of it.
Currently, the stock market is in a state of uncertainty, following recent political and economic instability in global markets, The best thing to remember for any investor trying to maximize his/her portfolio returns is to never base a decision on fear of short-term possibilities. At the same time, one can still prepare as well as possible for any scary scenarios that may arise by looking at stocks which will likely remain stable for a long time. These companies remain successful due to the ability to be adaptable.
One of these stocks is Coca-Cola. In 2010, the brand won both first and second place in the U.S. market with regular and Diet Coke. When healthier consumer habits began to stall growth in the company, they adapted to the trend with expansion of its products. Healthier sub-products such as Minute Maid juices, Powerade sports drinks, and Dasani water were Coca-Cola's focus. Coke has a long and solid record of consecutive years with raised dividends, and in 2013 beat raised its dividend by 10% (versus 6% for its closest competitor). Coca-Cola is a great example of an adaptable company and is a safe bet for investment in the current market.
With experts generally agreeing that the economy is headed in a positive direction, stocks ended “with a surge” right before the July 4th weekend. Since governments reported increased hiring in June, traders were both pushing stocks lower and pulling them higher because they were uncertain as to what would happen next.
By the end of the day on July 5th, the three main US indexes had ended about 1% higher than they had been at opening.
The increase in hiring could have meant that the Federal Reserve could ease back on bond buying, which would hurt many companies. The Federal Reserve has been artificially assisting the economy by purchasing bonds and keeping interest rates low. This cannot go on forever, but most would prefer a gradual end to the Federal Reserve’s assistance due to a continuing strong economy. Some fear that if the Fed thinks the economy is too good, they will end assistance very suddenly.
Investors bought stocks and sold bonds on Friday, which affected the yield on the 10-year Treasury bond (from 2.51% to 2.73%). This is the highest it’s been since August 2011. But the stocks sold were less than usual because many people were still on vacation from the 4th of July holiday.
Over $53 billion was spent on purchasing, feeding, medicating, caring for, boarding, and grooming pets in 2012 according to American Pet Products Association. Despite the Great Recession, that number has nearly doubled since the late 1990’s.
Other companies besides PetSmart that have a stake in the pet industry are PetMed, Central Garden & Pet, and VCA Antech. Of the 4 countries, PetSmart has the greatest 5-year stock return with a rate of 254.9%, followed by Central Garden and Pet at 64.4%. PetSmart operates retail stores that sell pet equipment, whereas Central Garden & Pet produces pet supplies.
Professionals like Jonathan Last, author, speculate that the reason for such dramatic increase is that pets are increasingly treated like family members.
Chances are, you or someone you know has Netflix. With more than 36 million subscribers, Netflix has developed a reputation as a fast-growing staple in the Silicon Valley, but it wasn’t always that way. They started out as a mail order DVD company. They are now one of the world’s biggest users of cloud computing-- an efficient way to store and send information from a central data center—through a partnership with Amazon.com. Netflix has managed to become an online-video provider and a developer of original programming, putting it in the ranks of bigger and more established companies such as HBO.
Netflix’s diversification of its product offerings has not come without significant adjustment and more than a few financial scares. The most notable of these came about a year and a half ago, when Netflix announced its plans to break up into two smaller companies: Qwikster (for DVD delivery) and Netflix (for online streaming of videos). Customers balked, and share prices fell from nearly $300 to $52.81. Needless to say, this was a fiasco and cost Netflix millions of customers.
After canceling their plans to break up, Netflix instead has expanded into original programming. This was a spectacular comeback, and Netflix managed to add about 2 million subscribers in the USA and share priced bounced back to over $200. According to Bloomberg Business, it’s one of the best-performing stocks of the year.
Officials at Netflix have seen share prices flocculate, and now they resemble a scribble. The stock has been trading in the low 200-range with a price-earnings ratio of 300, but officials are not concerned. After learning from their mistakes and drawing a more decisive plan for the future, they stand better able to serve their stakeholders and customers.
Currently Coca-Cola has a market cap of $188.2 billion. The return on equity has improved slightly when compared to the same quarter one year prior. When compared to other companies in the beverage industry and the overall market, Coca-Cola’s return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.The gross profit margin is currently 65.10%. It has increased from the same quarter the previous year. The net profit margin of 15.86% is close to the industry average. The company’s stock is up. Based on the strengths of Coca-Cola this stock still has good upside potential despite the fact that it has already risen in the past year. The earnings per share declined by 12.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat unstable earnings recently but there is predicted growth for the company as the year progress.. During the past fiscal year, Coca-Cola increased its bottom line by earning $1.96 versus $1.85 in the prior year. This year, the market expects an improvement in earnings ($2.15 versus $1.96).KO, with its decline in revenue, slightly underperformed the industry average of 2.2%. Since the same quarter one year prior, revenues slightly dropped by 0.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
Sony has multiple business units under three main departments: electronics, entertainment and financial services. While some of these business units have always been profitable for the company, others have been losing money for years. The business units under electronics department have suffered the most lost for the company. Last year, Sony came up with a new strategy called "One Sony" which is similar to Ford's (F) "One Ford". With this strategy, Sony attempted to reduce the amount of layers in management in order to reduce bureaucracy and allow for more efficiency in making decisions. Many of Sony's business units were brought together under the same umbrella and some of the products were discontinued in order to keep the company's focus in more successful products. Now Sony is more united and more determined than ever to target many of the challenges that drove the company almost into bankruptcy last year.
Sony is also in the process of entering and growing in new business areas that it didn't have much presence before. The company recently started to move into the healthcare business where it will offer products and services utilizing Sony's deep expertise in technology. Moving forward, the company will see a lot of growth through its medical equipment and medical diagnostic businesses.
A couple of days ago, Sony announced its earnings for the quarter and the full year. This was the first time in five years that Sony printed its earnings. This is somewhat encouraging but there is still a lot of work to do and a lot of road to travel. Sony's good results were a result of asset sales, including the company's headquarters in Manhattan, which it was able to sell for $1.1 billion. The share price has also appreciated 95% since December.
Time Warner (TWX) has experienced a 5% rise in their earnings. The company reported a first quarter net income of $410 million this is comparable to $1.34 per share. Time Warner is up $19 million from $382 million a year ago. The income in the company also rose to $420 million up from $414 million same time this year. Revenue is also up from $5.13 billion to $5.48 billion. During last quarter the company generated a free cash flow of $ 900 million. Much of Time Warner’s free cash was given back to shareholders through dividend and share purchases.
There has been a pattern of positive earnings per share which has been consistent for the past two years. The company has been progressive because they have expanded their digital presence. Consumers have been able to access the company’s services through various devices and platforms. The distribution deal with Netflix (NFLX) has had a positive impact on Warner’s multichannel subscription.
The Walt Disney Company (DIS) experienced an ultimate high of $58.22 on Monday. The company has also decided to close LucasArts. LucasArts is the video game section of Lucas films. Disney recently bought this company a couple of months ago for $4 billion. The company has decided that they want to focus primarily on a licensing model instead of game production. Walt Disney is also making more internal changes which will affect employment in studios and consumer production. This is a plan that the company has come up with in order to find more cost-effective ways that will increase the company’s profits in the future.
ESPN, which is a sports channel that is owned by Disney, has contributed to the success of the company. About 75% of cable network sales are from Disney’s ESPN. This allows for the company to have control of the price that they charge subscribers. A deal with AT& T earlier this year has allowed for a majority of Disney’s channels to be broadcasted on AT&T’s U-Verse digital network. Shareholders should stay up to date on upcoming summer blockbusters and the new changes that are taking place in Disney to see how it affects the company’s stocks.
SIRIUS XM Radio Inc. (SIRI) has reported their results for the 4th quarter. The company is currently experiencing a decrease in the growth rate of subscribers. This time last year, Sirius had 1.66 million Self-Par subscribers. However the company is expected to only have about 1.6 million new subscribers this year. The company is seeing process in their stocks. Stock prices have increased by 73% and are currently at the high-end in its 52- week price range. Investors are currently rating this stock in the strong-sell rate.
The advantage that Sirius has over company is the fact that they have many deals with automakers that puts Sirius satellite radio in about 70% of new cars that are made each year. Many people purchase Sirius after the trail-period ends. Sirius is dependent on the growth of the U.S. automaker industry. Fluctuations in the industry greatly affect the market share of Sirius.
Ford is currently experiencing revenue growth of 21.6% after substantial progress in the growth of their stocks last year. The company is however, experiencing a low profit margin of about 16.7%, which is lower than last year's profit margin. To combat this trend, Ford is looking to increase their innovations by challenging developers with "The Personalized Fuel Efficiency Apps Challenge". This initiative was introduced earlier this week in hopes of targeting anyone who is interested in creating a web-based or mobile app that will help Ford’s consumers track how many miles per gallon their vehicle is using. There is a $50,000 incentive for the person/team that is able to develop this app that will help Ford’s fuel economy.
The company’s South American and Indian sectors have faced challenges in the past couple of days. Ford’s South American branch has loss $300 million this quarter because of changes in the currency exchange rate, inflation, and trade restrictions. North America’s Ford will now have to work harder in order to regain the money loss .The company in India has also faced scrutiny because of controversial advertisements on Ford’s Figo-sub compact car. The advertisements were offensive and have had a couple of Ford workers in India fired.
Shareholders should stay abreast of the latest updates surrounding Ford’s stocks.
The Walt Disney Company (DIS) has recently increased its revenue by 5%. The company is rated by 17 out of 25 analysts as a buy. Disney is up by $130 million. Disney’s weakest point however is in their interactive area. Disney Infinity was scheduled to be released in June but has been postponed till August. This new video game will allow gamers to make use of Pixar characters. This new video game is set to help the hundreds of millions of dollars that the company has lost in this division.
Netflix (NFLX) announced this week that it is collaborating with Facebook to give subscribers the option of sharing what they watched with their Facebook friends. After the announcement of this new deal NFLX shares rose by 5.6%.This is will also boost the company’s stock prices. The company closed at $192.36 after this announcement. The Chief Executive announced that this new collaboration is an effort to increase the number of subscribers and revenue.
Critics believe that this new deal is an attempt to hide their inability to market their company successfully. These analysts believe that stockholders should sell their stocks.
NutriSystem has recently added another member to their board of directors. Andrea Weiss recently joined the board and will be bringing in her extensive knowledge and experience in marketing and development. Andrea will also be beneficial for the company being that 70% of customers are women. Her insight on this population will be valuable for Nutrisystem’s turnaround plan. The company is currently the world’s leading weight management provider.
Ford has been in the news lately with its progressive improvements to the company. Compared to last year’s sales Ford has already sold 20,000 more vehicles than last year. Sales have jumped 11%. Ford’s fourth quarter profits of 1.6 billion and revenue of 36.5% billion is predominately a result of the Asian and North American industry. There are many changes that the company is partaking in as well. The company is cutting back on production in order to meet profit. Ford has also increased its dividend by $0.05 to $0.10 per share. This will help shareholders increase their yield by 3.3%. Ford is expecting to earn roughly $1.40 per share this year.
The Coca-Cola Company (KO) is also giving back to their shareholders this year just as other companies have been doing. Coca-Cola announced a couple of days ago that they plan to return cash to their shareholders with the approval of a 10% increase in their company’s dividend. The company has improved since last year’s 25.5 cents per share to 28 cents per share. This is equal to a $1.12 per share for the annual divided.
Coca-Cola’s new dividend will take affect starting April 1st and will be payable for shareholders from March 15th. This increase represents the company’s substantial cash flow. Last year, Coca-Cola paid approximately 9.1 billion to stockholders. The company is currently at a 4% gain for the year. Stocks are trading up 0.5% to $37.75.
The Board that has been responsible for the company’s progress this year is newly appointed President, Coca-Cola International, Ahmet C. Bozer, Steven A. Cahillane, President, and Coca-Cola Americas, as Executive Vice Presidents of the Company, and J. Alexander “Sandy” Douglas, Jr., Global Chief Customer Officer, as a Senior Vice President of the Company.
Many companies continue to face difficulties in regaining a position that they maintained for so long. Sony at one time was considered one of the leaders in electronic goods. This has changed over recent years with the success of competitors such as Samsung and LG. The leading cause of decline for the company was the inability to keep up with the changing demands of consumers. Sony was also refusing to expand into the software sector, which was very profitable.
Sony Corporation’s CEO Kazuo Hirai is not discouraged by the challenges that the company is facing. He is very optimistic about the future of the company and has several strategies put into place for the upcoming year. One of the priorities of this plan is to create a smartphone that will be competitive and attract many buyers. In the past years phones such as Android that is affiliated with Sony has not received much attention.
Analysts say that since Hirai took the position of CEO the company is improving and is facing fewer losses. It is advisable to look at how the stocks will be affected by the new improvements of the company in the upcoming months.
Sirius XM Satellite radio (SIRI) has experienced great gain this year due to an increase in subscribers. There are currently 19.6 million self-pay subscribers and 23.9 million overall subscribers. The company has nearly doubled in its earnings this 4th quarter. SIRI estimated a total earning of $71. 3million last year, the company brought in $156.2 million this year. The board members of Sirius are optimistic about the future success of the company. CEO, Jim Meyer announced a couple of months ago that a $2 billion stock repurchasing program will also take effect this year. The stock repurchasing program will help return value to current shareholders.
Roughly 63.6% of analysts believe that investing in a Sirius’s stock is a good buy. This however is below the average of 77.1% for the other eight competitors. Analysts predict that the company will make earnings of 53 cents per share this fiscal year.
PetSmart (PETM) is currently one of the largest pet retailers that cater to the needs of pet lovers in the United States, Canada, and Puerto Rico. The company is currently experiencing some hardships during this tough economic climate. PETM experienced an impressive growth in the last two years with stocks ranging from $64- $72 per stock. The company however has cut back on the amount of stores they have built because of a disappointing 3.7% increase after 46 stores were opened last year. This is compared to 14% in prior years. Analysts predict that the company operating margin will continue to decline because of several factors. PetSmart has increased their payroll tax to 6.2% leaving less money to invest in the company. The company has lost is uniqueness and is comparable to other pets stores such as Petco .
The company has recently appointed Bob Moran as their new Executive Chairman. The company is planning to hold a Planned Management Succession in order to discuss strategies that will help the company regain their position in the pet supply industry. Shareholders should keep themselves updated about PetSmart’s future goals.
Time Warner (TWX) signed a new streaming agreement with Netflix on Monday. The company’s CFO, John Martin, announced this deal which will consist of Netflix (NFLX)‘s subscribers being able to watch eight of Warner’s shows and potential future shows. Ironically Time Warner’s shares fell to $49.12 on Monday after the announcement. Observers advise stockholders to stay abreast of upcoming news regarding the deal’s influence on future stock prices.
The Streets writers have rated Time Warner’s company with a score of A+. The company’s rating is based off growth, stock performance, efficiency & valuation, and risk. Time Warner is said to have a solid stock price performance, growth in earnings per share, and a largely solid financial position. These are a few of the company’s strengths. Analysts predict future shares to increase by 37.02%, a rise which will exceed S & P’s 500 index. Investors are optimistic about the progression of the company’s future earnings.
During this time of the year “The Santa Claus Rally” and the “January Effect” are said to be reasons behind the increase in stock purchases and prices. The Santa Claus Rally is believed to be the time period after Christmas and before New Years in which stock prices increased drastically due to factors such as investments of Christmas bonuses and an overall happier group of people in Wall Street. Comparably, the January Effect is also described by analysts as the increase of stock purchases in hopes of higher market in the beginning of the following year.
Sirius XM (SIRI) will possibly be influenced by both effects during this holiday season. Around this time last year the company was experiencing a standstill in their stock prices. A couple of days later on December 23rd the company went from a stock price of $1.78 to a ten cent increase of $1.88 on January 3rd. Analysts will describe this increase as a combination of both Santa Claus Rally and the January Effect. A day after this change, the company announced a record high of 1.7 million subscription additions. This positively effected stocks causing stocks to increase to $2.19 in less than two weeks.
If this same trend continues this year stockholders should anticipate an individual SIRI share to be valued at $3.59 by January 17th. Sirius is up by 60% compared to last years totals and investors project that there will be a net subscription of 2 million for 2012.
Ford has been experiencing a positive trend in the past couple of months despite the company’s lost gross of $404 million after the closing of two European plants. In July, Ford reached an all-time low of $8.82 per share. The company is currently selling shares at $11.79. Analysts believe that though this is an increase from the summer, shares could have been valued at $15 if it wasn’t for the unpredictable European economy.
Stockholders should look out for the influence Ford’s new European strategy will have on future stock prices.
Disney (DIS) is paving the road in more industries than one.With the Netflix (NFLX) Disney deal secured, Disney stands to reach an even broader audience, streaming. Its golden brand directly to families and more importantly children via the Netflix online and mobile network.
To couple with this groundbreaking deal, Disney will open its recently expanded Multi-million dollar “Fantasyland” here in the US.This new attraction includes renovation to Dumboride, two new castles, and Goofy’s Barnstormer rollercoaster.These moves by Disney are both technologically innovative and while there has been a minor hiccup in the Disney stock price (This helped send the shares down from $50 to $47 a drop of roughly 6%).This is not trending and the company has already rebounded to $50.05.
Keep your eyes on this stock, though major changes aren’t set to happen until 2016 with the Netflix deal, there are many other tricks up Disney’s sleeve that have analysts baited and waiting.
Sirius XM Radio (SIRI) announced on December 6th that it will issue a special dividend before the end of the year. This means that Sirius XM Radio is offering to purchase shares at market value with a bonus of $.05 per share. If an investor has 10 shares of Sirius XM radio stock, and sell their stock between the open periods of 12/18 to 12/28 they will gain an extra $.50 for the transaction.
Nutrisystem names new CEO
Last month, Nutrisystem, the weight-loss company, appointed Dawn Zier, former President of Reader’s Digest, as their new CEO. She has replaced Joe Redling who struggled to improve NutriSystem’s financial performance.
Nutrisystem has been experiencing negative growth. Their 2012 earnings were 57% less than their 2011 earnings and the company reached a seven year low. Such dismal growth can be attributed to stiff competition within the weightloss industry—Jenny Craig, Weight Watchers—and the overall poor condition of the economy.
The company hopes that CEO Zier’s outside perspective could help the company reorganize its structure and repair the financial damage. As of right now, investors think that Nutrisystem is not a recommended stock.
PetSmart's Growth Surpasses Expectations
PetSmart’s 50% increase since last quarter has surpassed the expectations of investors. Despite the economic recession, consumers, especially affluent pet owners, are continuing to buy for their pets. In 2010, PetSmart partnered with GNC, the vitamin company, and began to sell premium pet products. The steady increase of PetSmart stock demonstrates that targeting higher income pet owners and hooking them onto the PetSmart brand was a good strategy. Rather than focusing on lower end items such as dog leashes, kitty litter, etc., the company began to sell more pet pampering items, pet furniture and gourmet pet food.
This shift to higher end products is continuing to fuel PetSmart’s growth. Investors are optimistic about the company’s future.
The Force is with Disney
On October 30, 2012, Disney purchased LucasFilms from sole owner George Lucas for $4 billion—half of which was paid in cash, the other half in stocks. The acquirement of LucasFilms means that Disney now owns the legendary Star Wars franchise. Disney CEO, Robert Iger, believes that owning the franchise will push the Disney entertainment division to a new level of success. Iger wants to continue Lucas’ legacy and stay true to the essence of the Star Wars franchise. Disney plans to release a new Star Wars film in 2015 and every couple of years thereafter. The Star Wars franchise will also be incorporated into Disney theme parks.
Despite handing over ownership, George Lucas will serve as the creative consultant and much of the divisions within LucasFilms will stay the same including their headquarters. While the general attitude about Disney purchasing LucasFilms has been optimistic, many are skeptical about the direction that Disney will take the Star Wars franchise and how much extra revenue an already established brand would give Disney.
Disney stocks are experiencing positive growth.
Ford to close plants in Europe, cut jobs
After trying to expand throughout Europe, Ford has decided to pull back with its effort. The company will shut down two plants in Europe and cut 4,300 jobs in order to cover the $1 billion+ loss they expect to have at the end of 2012.
Although Ford and Europe share a long history, Ford's goal was to match the global expansion set forth by its competitors, GM, Hyundai, and Volkswagen. The current state of Europe Union, however, with its debt crisis, has led to a very unfavorable market for car sales.
Many analysts believe that Ford is making a good decision and they are on the correct path for future growth.
Disney Stock Down Despite Amusement Park Growth
At the end of last quarter, Disney stock reached a 52 week high of $53.40. This week, however, analysts at Caris, an investment bank that does equity research, has downgraded the Walt Disney Corporation from above-average to average because they believe that Disney has very little room for more growth.
Disney is unique because their revenue comes from a range of diverse business segments. The main money-makers are the Media Networks (ABC for example), the amusement park and its studio entertainment. The company is currently running into problems with its Media Networks due to defferred affilate fees, the subsciption fees that Disney should receive as the distributor of the cable TV networks. While the amusement parks are experiencing impressive growth, Disney's current financial problems with cable TV has pushed Disney's stock down to $51.
Some analysts believe that, since Disney's amusement parks are still going strong, the company will see more growth in the future once it begins to receive its expected affiliate fees.
Ford Struggles to Keep Up With Competitors
While GM and Ford are usually traded together, in the most recent months, GM seems to be gaining ground while Ford is losing. Analysts say that the underlying reason behind GM's increased support is that, although both companies are experiencing the same type of problems in Europe, etc., the investors are used to hearing about GM’s struggle ever since the bailout. Ford, which was not bailed out, has rarely been in the news for its problems. Therefore, the $1 billion loss in the European markets during July left investors shocked and uncertain about the future of Ford.
Ford’s main obstacle is its campaign to expand globally. Its competitors (GM, Hyundai, and Volkswagen) have established markets in Asian countries and Ford, desperately trying to catch up, has outspent itself. As long as Ford continues to spend billions in an attempt to expand in Asia and Europe, the company will see very little profit. The company plans to have 15 new models of Ford in China by 2015.
Although Ford has had strong profits in North America, Chrysler Ram pickup truck has the potential to be major competition to Ford’s signature pick-up truck. Investors are currently pessimistic about Ford’s future.
PetSmart to Replace Sunoco on S&P 500
Beginning on October 4th, 2012, PetSmart, which was originally represented by the S&P 400, will replace the gas company Sunoco, Inc on the S&P 500. You may ask, what’s the difference? The S&P stands for Standard and Poor and it is made up of 500 different stocks that are the most dominant in the stock market. These stocks represent 70% of the US’s equity market so the S&P 500 is considered to be the ultimate measure of stock market performance. The S&P 400, on the other hand, represents companies in the “mid-cap” range—between $2 billion to $10 billion. Still a lot of money, but not as much as the companies represented in the S&P 500.
As Petsmart takes Sunoco’s place, Sunoco will be acquired by the Energy Transfer Partners--part of the New York Stock Exchange. Petsmart will be represented under the label of “Consumer Discretionary”---> ”specialty stores”.
PetSmart has had an impressive 10 weeks with constant growth topped off with a 3% increase this week.
Time Warner to carry NFL Network
Beginning on September 27th, homes that have Time Warner cable will be able to view the NFL Network along with its companion service NFL Redzone. Time Warner claims about 12 million cable customers nationwide. Despite the impressive customer base, Time Warner Cable is the last major cable network to negotiate with the NFL channel. This is mainly due to Time Warner’s unwillingness to accept the NFL Networks’ prices. After 9 years of negotiation, the two companies have finally reached an agreement that both sides determined to be of fair value.
This news does not only please sport fans but investors as well. The Time Warner stock has increased since the news. Overall, 2012 has been a good year for Time Warner as demonstrated by a stock increase of over 50%.
Sony Struggles to Keep Up
After a not-so-impressive release of the Sony Tablet P in early 2012, Sony continues to search for its place in the electronics industry. Recognizing that smartphones are becoming the thing of the future, Sony is developing new strategies that would allow the company to break through the global smartphone market; it only possess 4% of the market while its competitors, Apple and Samsung, own 24% and 31% respectively.
The newly appointed Chief Executive Officer, Kazuo Hirai, devised a plan for restructuring which would include: laying off 1,000 employees, moving headquarters from Lund, Sweden to Tokyo and shifting its focus from traditional smartphone manufacturing to innovative smartphone offerings like video games to provide a clear alternative to Apple and Samsung products.
On September 7th, Sony debuted its campaign for the Xperia smartphone in the UK. The Xperia smartphones can capture and share images simply by touching two smartphones together. The phone is now available for pre-order in India and has been featured in the Bond movie "Skyfall". Sony hopes to be a major force in the industry within three years.
August 29th, 2012
Time Warner Cable announced that it will be investing $25 million to build a fiber network in New York City. This new network will provide customers with higher speeds, up to 1 gigabit per second. Time Warner will be installing this network in Brooklyn and the financial district in Manhattan. Time Warner has not yet announced what it will charge for this new speedy internet connection, but its aiming to attract business customers who will benefit from the additional speed boost.
Time Warner isn’t alone in expanding its services in New York City. AT&T, Verizon Wireless, and Cablevision Systems will all be expanding their internet services in the city as a part of technology initiative sponsored by Mayor Bloomberg.
August 22nd, 2012
Netflix is continuing to expand its range, with its video-on-demand service scheduled to roll out in Sweden, Norway, Denmark, and Finland in the second half of 2012. Netflix aims to offset its slowing expansion in the US market by expanding into Europe. This European expansion is not Netlfix’s first step outside the United States, Netflix already offers its services in Canada, the U. K., Ireland, and Latin America.
Netflix will face a new challenge as it enters northern Europe: many people are accustomed to downloading movies, for free, off of websites such as the Pirate Bay. However, Netflix does not have serious competition in the legal video streaming business, as other Stockholm based video on demand companies have been unable to negotiate distribution deals with content producers.
August 1st, 2012
Sirius XM is bringing new programming to the air this month. One new show, Yo Soy Juane, is hosted by Juanes, a 17 time Grammy winner. This show is geared at listeners who speak both English and Spanish. It will play the music that inspired Juanes, as well as his own music, and broadcast interviews with Juanes. This show will air on Sirius XM’s Calliente channel.
Sirius XM’s other new program is for college football enthusiasts. College Sports Nation Camp Tour will visit 13 of America’s best college football programs over the summer, as the teams prepare for the upcoming season. The program will feature analysis of the programs by Sirius XM’s experts as well as interviews with coaches and players.
July 24th, 2012
On June 9th, the engine of a Ford Escape caught fire while the vehicle was being driven from Ford’s Louisville plant to another plant in Kentucky. Ford investigated, and concluded that the fire was a unique case. On June 18th, it happened again, this time to a Canadian Escape owner. Another Ford employee driving an Escape experienced a fire on July 11th, which prompted Ford to recall 11,500 2013 Ford Escape vehicles with 1.6 liter engines.
The engine fires are believed to be caused by a flaw in the fuel lines, which were manufactured by TI Automotive, not Ford. The fuel lines were mechanically scored, which could cause them split open and leak. Ford says that it will pay $660 per car so that the cars can be transported to dealerships and the defective part can be replaced.
Production of the Escape continues, despite the recall.
July 18th, 2012
Wait times are down this summer at the Anaheim Disneyland because many people are flocking to Disney’s California Adventure to visit the Cars Land area, which opened June 15th. Cars Land has been in the making for five years before finally opening to the public this summer. Cars Land includes three rides, two restaurants, a snack shop, a clothing store, a toy store, and a souvenir shop. The Radiator Springs Racers, one of the rides, has proved to be extremely popular, with people waiting in line for up to three hours to climb on.
This increase in visitors may allow Disney to increase admission prices. Visiting Disneyland is already pricey, a ticket for anyone over ten is $87.
July 10th, 2012
Currently, there are 5.6 billion shares of Coca-Cola available. On July 27th, the number of shares will double to 11.2 billion. This means that there will be more shares of Coca-Cola than people on the Earth.
The board of directors decided to split the stock as to make the stock available to more people and to further increase its value. If you currently own one share of Coca-Cola, after July 27th, you will own two, but the value of your original share will be decreased by half. The amount of your investment would remain the same; it will just be distributed differently. For example, if you own ten shares of Coca-Cola, and they are worth $75 each, and their price remains constant, on July 27th, you will own twenty shares of Coca-Cola, each worth $37.50.
This split with be the 11th in Coca-Cola’s history, since it became listed in 1919. If you had purchased a share of Coca-Cola when it was first listed, and reinvested all of the dividends paid, that one share would be worth about $10.3 million today. Investing can really pay off.
June 28th, 2012
Time Warner Cable is introducing a new type of usage-based internet service plan in south Texas. With this new plan, users who use less than 5GB of data a month will receive five dollars off their bill for that month. Customers who exceed the 5GB limit will be charged $1/GB, up to a limit of $25. This plan is aimed at light internet users, and not those who regularly stream or download music or videos. Households that select to subscribe to this plan will be able to track their data usage with a meter provided by Time Warner.
Time Warner Cable has previously tried to offer usage-based internet service plans, however, it previously discontinued these plans after a large public outcry. This time, the usage based plan is different, as it is not replacing the unlimited data plans, rather, it is an alternative for light internet users who wish to reduce their monthly bill.
June 25th, 2012
This summer, PetSmart is teaming up with Bret Michaels to release a new line of pet accessories. Bret Michaels, singer and guitarist of the rock band Poison, wants to bring out your pet’s inner rock star with his Pets Rock collection. The collection includes toys, beds, collars, leashes, bowls, and even clothing for your pet. This new line will allow people to personalize their pet’s life, without paying big bucks for designer bowls or collars.
While some of parts of the line are more decorative than functional, like doo-rags or hair bows for dogs, others are genuinely useful. The pet economy is a multi-billion dollar industry in America, in 2011, Americans spent fifty-five billion dollars on their pets. This new line will allow PetSmart to expand its sales into unexplored territory.
Do you think this line will be successful? Do you think its success or failure will affect the value of PetSmart's stock?
June 25th, 2012
While Netflix originally was a mail order movie service, in 2008 it expanded into the video-on-demand industry. This shift into the video-on-demand industry introduced a new cost: the cost of the bandwidth necessary for streaming media. Today, Netflix spends about 20% of the cost of a subscription on this bandwidth.
This is a substantial cost, and Netflix, like all businesses, tries to reduce its operating costs to increase its profit. To reduce the cost of bandwidth, Netflix is developing its own content development network. Netflix will distribute its content over this network and not have to pay internet service providers that they previously used to distribute their content.
The development of this network is an investment in Netflix’s infrastructure, which will allow it to further expand in the future.
How do you think Neflix's investment in its infrastrucutre will affect its stock price?
June 25th, 2012
On June 21st, SiriusXM(SIRI) announced that it will provide live coverage of Wimbledon this year. It will cover The Wimbledon Tennis Championships from the first day of play on June 25th all the way to the finals, which will be held on July 7th and 8th. Throughout the championship, SiriusXM will provide its listeners with thirteen hours of Wimbledon coverage daily. Sirus XM listeners will be able to tune in in their cars, on the internet, or with the SiriusXM Radio App available for iPhone, Android, and Blackberry.
This won’t be the first time Sirius has covered the Wimbledon. From 2005 through 2009, Sirius had an agreement with Wimbledon, allowing it to broadcast the championship. This isn’t SirusXM’s first foray into sports broadcasting, they already broadcast forty channels of sports talk, regularly.
How do you think this deal will affect SiriusXM's stock price?
This summer, you’ll be able to find Nutrisystem Everday™ products in your local Kroger grocery store, due to a new deal between the two companies. Nutrisystem believes that its product availability in grocery stores will complement its already existing direct sale business. Now, everyone will be able to purchase Nutrisystem’s snack bars, smoothies, bakery and breakfast items. These products are good sources of fiber, nutritionally balanced, and low in fat and calories.
Nutrisystem helps people lose weight by producing balanced pre-prepared meals and snacks with low glycemic indices. Nutrisystem had a net income of $12.3 million in 2011, far less than its $33.6 million income in 2010. Perhaps this expansion into grocery stores will help Nutrisystem boost its income in 2012.
Ford Sees Green!
Summer is the time to get out and explore. How fitting that one of Ford Motor Company’s top sellers is named “The Explorer”. Ford Motor Company has reported a gain of 13% domestic sales revenue increase over last year’s totals as of May 2012! Many new families will be out exploring in new Fords this summer.
Not only is Ford Motor Company showing leadership in reducing the greenhouse gas emissions of its vehicles, but the company is also being recognized by the Environment Protection Agency (E.P.A.) for its greenhouse gas leadership in manufacturing. Ford is bursting through the fuel efficiency market with electric vehicle options and battery innovations.
Ford is working hard to reestablish its role as an automotive power house. Summer sales along with the unveiling of 2013 models will be sure to make Ford (F) a stock option to watch.
This summer, Disney will release two films: Brave and The Odd Life of Timothy Green. Brave will be released near the beginning of summer, on June 22nd. Mid-August, Disney will release The Odd Life of Timothy Green.
Brave, an animated film produced by Pixar, tells the story of a Scottish princess, Merida, whose actions inadvertently lead to a curse being placed on her parents’ kingdom. As she attempts to lift the curse, she learns the true meaning of bravery. This is Pixar’s first film with a female protagonist and Merida is the first Pixar character to be included in Disney’s princess line.
The Odd Life of Timothy Green, based on a story written by Ahmet Zappa, follows a young boy who suddenly appears in the lives of a childless couple. However, this is no ordinary boy, as his parents soon discover.
The Motion Picture Association of America has given both of these films ratings of PG, or parental guidance recommended, making them ideal for families to see during summer break.
If these films perform well, the boost in revenue due to ticket sales may cause an increase in Disney’s share price. Conversely, if ticket sales are less than the cost of production, Disney’s shares may lose value.
With the recent addition of Ford Motor Company to offered SIF stocks, current news will begin to include the automobile industry. Beginning in 2008 the automobile industry began to fail. We saw major losses during the recession and both GM and Chrysler declared bankruptcy. Currently, it looks as though the industry, including Ford Motors, has recovered and is looking forward to robust growth.
“Autos have had their strongest performance this year since early 2008, with purchases exceeding a 14 million annual rate in each month of 2012 so far.” This growth is also revving up the entire economy. According to government data, half of the growth in the entire US economy during the first quarter of 2012 can be attributed to the automotive industry.
While the industry wide decline hurt Ford Motors, it did not force them into bankruptcy like many of its competitors. This bodes well for Ford, demonstrating that it may be in a good place to withstand future hard times. With the economy recovering, and automotive companies leading the way, now might be a great time to invest in Ford Motors!
Have you ever tried Coconut water? Coca-Cola thinks you should. Last week, Coca-Cola Bottling Company announced it had acquired a majority share of Zico, making it the primary owner. Zico is the second largest international brand in the coconut water business, an estimated $350 million industry.
Some investors think this is a fantastic purchase for Coca-Cola. The Coconut water industry has seen vast growth over the past few years and is currently being marketed as an alternative and healthier sports drink. John Craven, founder and CEO of BevNet, a beverage publisher, says “roughly 3 in 10 new beverages coming to market today have coconut water as a component.”
Other Investors though have mixed thoughts about this new endeavor. Pepsi Co., a leading competitor of Coca-Cola has already entered the coconut water industry. After introducing the ingredient into several products, Pepsi decided to pull the plug and backed away from coconut water because it apparently lacked profitability. Some skeptic Investors are wary Coco-Cola may be heading toward a similar fate.
With such a risky project being undertaken, Coca-Cola stock looks to be making major moves either up or down over the next few years.
Sirius XM Radio may be approaching the worst times it has faced since its Initial Public Offering. In 2000 Sirius XM reached its peak in value at over 60 dollars per share. A rapid decline over the next two years brought the value down into single digits. Since this time Sirius XM has remained at this low value, today trading at roughly 2.5 dollars per share.
Recent news has suggested that Sirius XM may be expecting a hostile takeover by Liberty Media. After lending Sirius XM 530 million dollars to keep from going bankrupt, Liberty Media was offered a 40% share in Sirius XM. With stock prices continuing to stagnate and Liberty Media fearing they will not get their money back, they are considering taking over Sirius XM.
The price of the company and limited future prospects may keep Liberty Media from this course of action. Sirius XM is in the business of selling satellite radio hardware and subscriptions. Although subscriptions have increased from 20.2 million last year to 21.9 million this year, the market for this service is dwindling. Online competitors such as Spotify and Pandora Radio offer similar services without the expensive subscriptions. This news has investors in Sirius XM stock cautious and worried.
Sony seems to be falling behind the curve on new handheld electronic devices. Recently, Sony Corporation released and began selling the Sony Tablet P. This portable tablet was supposed to carve a new niche in the market while also competing with some leading of the tablets such as Apple’s new iPad. Unfortunately for Sony though, the response to the tablet has been less than positive. Even with lawsuits and other negative media generated toward Apple, the new iPad is still outselling the new Sony Tablet P.
This new product is also failing to control a new portion of the market. With its foldable design, the Sony Tablet P was supposed to attract a new audience and offer new features. This has not happened; Consumers are instead finding few advantages for the device and are choosing to purchase other products.
This trend is a continuation of a poor showing from Sony Corporation at the Mobil World Conference at the end of February in Barcelona, Spain. At the conference Sony had planned to release its newest 2012 gadgets but failed to impress media representatives, allowing its competitors to steal the show. Since the conference, Sony Corporation Stock has fallen by over 6%.
Netflix may see a major shift in its business and its product over the next year. According to research from HIS analysts, online movie viewing will soon overtake DVD sales in the United States. “We are looking at the beginning of the end of the age of movies on physical media like DVD and Blu-ray,” analyst Dan Cryan stated. Recent data suggest that online viewing will more than double from 1.4 billion in 2011 to 3.4 billion in 2012. Coupled with the decline in DVD and Blu-Ray viewings, hard copies of movies are becoming obsolete.
While this news is significant on its own, it is also certainly expected to impact Netflix in multiple ways. The company was originally created on the idea of distributing DVDs to customers through the mail. It has since expanded to be the largest online subscription plan to unlimited streaming of movies and tv shows. With less individuals watching DVDs, a portion of Netflix’s business with be hurt; however, with more people watching movies online, Netflix should see a rise in sales. Since Netflix is such a dominate force in online streaming they are expecting to benefit from this change. What do you think? Will growing online movie viewers and shrinking DVD sales help of hurt Netflix in the coming years?
Walt Disney finished the month of February having gained 7.9% in its stock price. This trend was a continuation of high returns since the start of 2012. Many analysts are stating that an improving economy will lead to potential future growth for the entertainment giant.
As the economy continues to stabilize and improve many investors feel Disney will benefit from increased sales at theme parks as well as on content sales such as movies and toys. Another big break for Disney could come with media offerings. Disney products appeal to all ages. Alternative content-delivery companies like Hulu and Netflix know this very well and will be fighting for the rights to air Disney content. This should give Disney the upper hand in negotiations and allow them to receive top dollar for their products going forward.
Late last week Coca-Cola Company surprised its investors by releasing its full 2011 report. The information shows extremely positive gains throughout Coca-Cola’s business. While growth domestically has been fairly modest, internationally Coca-Cola is exploding showing overall gains of 10% compared to last year.
Coca-Cola’s great international gains are mostly coming from Asia. In Thailand alone, sales of Coca-Cola products grew by 33%. This trend was followed by similar growth in Indiana of 15% and in China of 13%. With these areas already consuming large quantities, increasing sales by this much is enormous. This growth appears to show that Coca-Cola is not being affected very much by the global slump in the economy.
Although Coca-Cola seems to be a great investment right now, there is room to be cautious. The growing issues with the European economy and high exchange rates between the American Dollar and foreign currencies my slow future sales. Two larger reasons for concern are the health consciousness of consumers and the lack of diversification by Coca-Cola. With many consumers become more conscious of their health, the amount of soda being consumed may decrease. Furthermore, unlike its competitor Pepsi Company which also sells snack foods and orange juice, Coca-Cola only sells soda.
Amazing growth over the last year and concerns about continued growth means Coca-Cola Company’s stock price may go in any direction.
In 2010, pet products and supplies amounted for a $35 billion market and it is rapidly growing. According to a recently published CNBC article, “62 percent of all U.S. households own a pet, which is equivalent to roughly 71 million homes.” PetSmart, the United States’ largest retailer of pet food and supplies accounts for approximately 15% of the industry.
PetSmart prides itself because it supplies healthy, all natural pet foods and a large portion of exclusive products. Only 10% of PetSmart products are available elsewhere. Recently, they have expanded their services, now supplying grooming and boarding services for dogs. In the coming years PetSmart expects to open 450 locations in North America. With such steady growth and plans for a large expansion, PetSmart stock prices are on the rise!
As the domestic automobile industry begins to recover, Sirius XM Radio may see their profits rise in 2012. A large percentage of Sirius XM subscribers choose to listen to content while driving. Sirius XM has made deals with several automobile manufacturers such as Ford and GNC, where they offer free trail subscriptions to new owners. When the free trial expires, a portion of the car owners decide to continue using Sirius XM.
With the number of cars sold in the United States growing, and with this trend expected to continue, it makes sense that Sirius XM would see an increase in sales. Sirius XM stock prices have exceeded expectations and risen over the past year. Will this trend continue in 2012?
With the economy slumping, many American’s are cutting back on their consumption of weight loss products. This was demonstrated by low growth levels throughout the health industry over the past 4 years, but this may change.
Weight Watchers, an industry competitor of NutriSystem, had decided to target a new audience. Weight Watcher is now expanding their advertising to target both men and countries such as China. According to CEO David Kirchhoff, 90% of the company’s clientele used to be women.
After seeing its sales fall by 22% last year, NutriSystem may begin to worry. Can NutriSystem recover from a disappointing 2011? Will they be able to target a larger market like their competitors?
The Food and Drug Association (FDA) has recently found a fungicide in Brazilian oranges that is known to cause cancer. The FDA is considering recalls on certain oranges, pending further investigation. Companies like Coca-Cola, which own Minute Maid, face the possibility that if this recall happens, demand for their orange juice products will plummet. A similar thing happened during the mad cow hysteria in 2003, and McDonald's and Wendy's were greatly affected, having their prices drop by 6%. It took half a year before these prices were able to get back to their previous highs. Experts don't think that this orange problem will grow as large as mad cow was. But if Coca-Cola begins to face higher prices for their oranges, they could be forced to sell their products for a higher price. This could lead to even less demand for these goods, as consumers could easily turn to other drinks. How big of a problem do you think this is going to become for Coca-Cola, and how much do you think its stock price will be affected, if at all?
Netflix proclaimed a month ago that it sees HBO as its chief rival, and it appears that HBO agrees, as the company confirmed on Thursday that it had decided to stop selling DVDs to Netflix at a discount.
Netflix typically buys film and TV show DVDs that it rents to customers through wholesale venues, thereby taking advantage of volume discounts. But from now on, Netflix will have to buy DVD sets of shows like "True Blood" and "Boardwalk Empire" at retail in order to rent them to customers.
It's not a huge financial hit to Netflix, but it is a signal about what the competitive landscape looks like. Asked about the change, a Netflix spokesman said, "Netflix will continue to provide HBO titles on DVD and Blu-ray to our members."
The change was believed to have taken effect on Jan. 1.
In a deal that represents billions of dollars in revenue for the Walt Disney Company, the entertainment giant and Comcast said Wednesday that they had reached a decade-long distribution agreement covering all of Disney’s television content, including streaming for iPads and other devices.
The unusually long-term agreement provides a window into the future of television viewing and how its content will be consumed. Comcast, the nation’s largest cable provider, will gain the rights to provide the Disney Channel, ESPN, Disney XD, ABC Family and the ABC broadcast network, among other Disney-owned services, to subscribers wherever they want to watch.
“This is a landmark deal for us,” Neil Smit, president and chief executive of Comcast’s cable division said in an interview. “It’s the first time customers can watch ESPN, ABC and Disney across multiple platforms both in and outside the home.”
Petsmart's third quarter ended in October with more great numbers. Profit jumped 32%, raising the stock price to $.50 per share. Their Earnings per Share (EPS) also grew by 30% for the third straight quarter. In its 1,210 stores across North America and Puerto Rico, sales rose 8% to $1.5 billion. Petsmart CFO Chip Molloy expects profit to be up 10-16% from last year in the fourth quarter. On November 9th, Petsmart launched its new online store, Petsmart Boutique. Items on the website feature special new items, including ones that can't be found in store. Is now the time to sell Petsmart stock at its high, or do you think their increasing success will continue?
Have you ever had a free sample? Did you know that Sirius has incorporated the idea of a 'free sample' into their business model? Sirius works with the car companies to gives free trials of their satellite radio service to people who buy new cars. Then, Sirius hopes that when the trial period runs out, the people will decide to subscribe to Sirius satellite radio.
Right now, not enough people are deciding to do buy Sirius for themselves. Sirius's satellites are getting older (which may mean they will no longer be able to guarantee crystal clear service). Additionally, other companies like Pandora and Spotify (internet radio companies) may be a cheap, alternative way for people to listen to radio in their cars in the future.
Sirius's response is to now try to give trial satellite radio service to people who buy used cars, essentially giving away more 'free samples'. The way the economy is going, there has been an increase in used car purchases. Do you think Sirius will be able to pull in enough new customers?
Have you ever seen a Coca-Cola commercial? Then you've seen Coca-Cola's marketing work in action. Everyone can remember famous Coca-Cola commercials and slogans from years past. Yet according to the European Brand Institute, Apple is now beating Coca-Cola in "brand value" which tells how powerful a company's label and name are. The study looked at the 3,000 companies from 24 countries! This is the first time the institute has looked at companies on a global scale. It isn't just Apple and Coca-Cola - the top 10 companies were all from the U.S. Will Coca-Cola take its place back at the top?
Sony Corp is trying to compete with Apple’s iTunes in the online music and movie industry. Sony announced that it will continue to bid on a big British music company called EMI. Sony has about 28% of the album market in the U.S. and hopes that buying EMI can help it compete with iTunes. To buy EMI, Sony would spend about 3 billion dollars. Other companies also want to buy EMI and might bid a higher amount to buy it. Sony’s music division has made 20% of its profits this year, so expanding this department makes a lot of sense for them. Do you think a takeover of EMI by Sony will help its stock a lot, a little, or not at all? Will Sony ever be able to compete with Apple’s music giant, iTunes?
Sirius Satellite Radio has announced that on 1/1/12 they are raising subscription prices from $12.95 to $14.49 a month. This small $1.54 a month increase will generate millions of dollars for Sirius in the long run, but the short term effects of this price spike is important to look at. Current Sirius customers have can lock in their current $12.95 rate for awhile, but they won’t be able to cancel their subsciption for 2 or 3 years. People who don't have Sirius Radio can also get the lower $12.95 price if they get the service before 2012 starts. The full effects of Sirius’ price increase may not effect anything for awhile because most of their customers can continue to pay the lower price for as long as 3 more years. How long do you think it will take for Sirius stock to start showing profits, and how long are you willing to wait?
Instant TV and movie provider Netflix has announced that it expects to lose almost a million subscribers in the upcoming months, giving it a total of 24 millions viewers, down from the previous 25. Subscription losses are expected as a result of Netflix CEO Reed Hasting’s announcement of raised monthly prices. Customer losses are expected to continue into 2012, as no signs indicate otherwise. Since Hasting’s announcement, Netflix’s stock has dropped nearly 40%. They continue to face stiff competition from companies such as Redbox and Blockbuster, who are currently offering a free trial deal in order to try and win over former Netflix customers who aren’t willing to pay the new prices. Do you think Netflix can bounce back from these losses, and if so, how long will we have to wait?
September 2011As of this month, Netflix is raising their monthly fees for unlimited streaming and unlimited DVDS from $9.99 per month to $15.98/ month. They are adding two plans; one that offers unlimited and streaming with no DVDs for $7.99/month and another that offers unlimited DVDs (1 at a time) and no streaming for $7.99/month. People currently on the Unlimited Streaming/DVD plan need to pick a different plan before their billing date or they will be charged $15.98/month from here on out. As a result, some customers may stop subscribing to Netflix in protest; even to the point of switching over to other services. According to the Netflix CEO, Redd Hastings, the main competitors to Netflix are internet streaming options as offered by HBO and Comcast, and not Redbox like many would expect. How do you think the change in monthly fees will affect the worth of Netflix stock?
August 2011This month, Sony is cutting the price of the Playstation 3 (PS3) by $50; the base model now costs $250 and the same system with twice as much hard drive space now costs $300. The last price cut was in 2009 when they released a slimmer model. The Playstation 3, turns five this November, which is old for gaming consoles; the main competitors, the Microsoft 360 the Nintendo Wii, are six and turning five, respectively. Video game consoles are generally released every four to six years, so the Playstation 3 is now a senior citizen, as far as consoles are concerned; however, the addition of the Playstation Move in 2009 may help keep the PS3 alive for longer. Sony is also releasing a new handheld console, the Playstation Vita, sometime before the holiday season this year. How do you think lowering the cost of the PS3 and the release of the Vita will affect Sonys stocks?
May 2011Sirius XM Radio stock hits $2.42 for second time in 3 weeks, a level not seen since July 2008. On May 13th this was reported on a CNBC newscast. It was also noted that Sirius stock is directly related to the automotive business. This is because most of Sirius income is made when people buy new cars and they can purchase the radio service at the same time. When a certain stock is linked to another industry, its important to pay attention to both. Over the years, the price change in Sirius stock seems to go along with the recovery of the automotive industry. A lot of people think thats not just a coincidence. Right now, shares of Sirius are inexpensive when compared to its potential and the growth that may be coming from the auto industry. But, as Jim Cramer of the CNBC show Fast Money likes to say, Do your own homework!
August 2011Back in June, PetSmart (PETM) announced that they were raising their quarterly dividend by 12% to 14 cents per share. Just like banks give their patrons interest for using their services, companies regularly give their shareholders dividends, or a small amount of the companys profit. This increase in revenue was available to PetSmart shareholders on August 12th if they held shares prior to July 29th. PetSmart announced a new partnership with ToysRUs that is giving rise to a whole new brand of toys that will be released in Spring 2012 for pet parents since PetSmart vice president of merchandising, Matt McAdam has noted the strong bond between pet-owners and their pets. Both PetSmart and ToysRUs are at the top of their franchise. How do you think this partnership will affect the price of PETM stock? Do you foresee any new dividend raises in the near future?
August 2011On the ninth, the nationwide system of banking in the United States, or Fed, made an announcement the short-term interest rates were going to remain low until 2013. Interest is the amount of extra money needed to pay back a bank or other lender over the initial amount borrowed. Low interest rates can be a way of trying to boost the economy since it means that people that borrow money dont pay back as much as they previously did. The NASDAQ Composite index (COMP) fell by 5 points, or 0.2%, on the same day. A composite index is a weighted grouping of individual stocks indices. Investors generally try to have a portfolio index above the composite index of the market. This falling change is not something new for traders and investors: in the last week of July and the first week of August, U.S. stocks fell 15%. Are you surprised that the stock market fell because of low interest rates? Do you think most investors only read the Business section of the paper?
Time Warner, Inc. (TMX) posted its second quarter earnings (earnings from April 1st-June 30th), which showed the fastest growth of revenue the company has seen in almost four years. Just like the school year is divided into quarters, so is the fiscal or financial year. The net income of TMX reached $638 million accounted for by a growth of 59 cents per share. This is up 14% from the second quarter of 2010.
Time Warner, Inc.s adjusted operating income rose by 6% to $1.3 billion, or 60 cents per share, which is four cents higher than expected. The operating income of a company is their net profit, or how much they make when the costs of running the company are subtracted. The adjusted operating income is a number commonly used to compare media companies such as TMX since it is the operating income with sources of income that are hard to compare, like real estate, because their worth fluctuates rapidly.
Sales rose 10% to $7 billion, which also topped the expected $6.8 million. This is the fasted growth rate since the third quarter of 2007. The growth rate increase was due to some big television and home entertainment releases that offset some of the production, or running costs. Since most people have already bought the newest releases, how do you think this will affect the companys finances for the third quarter (July 1st-September 30th)?
July 2011On July 31st, Coca-Cola Company will be raising their prices between 3% and 4% on drinks. This is to combat the rising prices of supplies, like corn oil, and packaging. Coke contemplated not raising prices until after Labor Day since it would make their competitors less likely to raise prices during the summer selling season, but they decided against it. Pepsi is also going to raise their prices, but is waiting until Labor Day to charge 3-5 percent more for their products. Coke is currently selling at $69.45 per share and has gone down from $69.73/share since yesterday. This is still close to the 52-week high of 69.82.
July 2011Sirius Satellite Radio has expanded very rapidly, but it now has some stiff competitors in the radio market. Pandora, a free, online internet radio, was limited to computers two years ago, but now that the iHeartRadio application is available on smartphones, Sirius needs to seriously consider some other options of expansion. Pandora has even made a deal with car manufacturers to have their application integrated into dashboards. Another competitor for Sirius is Spotify, an application that can play music from computers and smartphones and only made its debut into the U.S. mid-July. On July 15th, in spite of all the close competitors, Sirius was added to the NASDAQ-100 Index, which is a list of the top 100, non-financial stocks. Do you think the close competition will stunt Sirius growth?
July 2011Netflix announced on July 12th that they will be raising the monthly prices for online streaming plus one DVD in the mail from $10 to $16. The price of just online streaming will be $8 per month. Many customers are complaining about the price-raise and may cause many to drop their subscriptions to Netflix in lieu of other options. In the U.S. alone, Netflix currently has over 20 million customers, which will only grow over time. For old customers, the changes will go into effect in September, but new customers will get the new rates right off the bat. Back in November, the streaming service was only $8 with an additional charge of $2 a month for also getting one DVD. Many people are switching to streaming-only plans and others are cancelling their subscriptions entirely. How do you think this will affect the value of Netflix in the upcoming months?
July 2011Time Warner Cable (TWC) hit a new 52 week high of $80.86. The 52-week low for TWC is $50.41. The stocks 50-day moving average is $76.11 and the 200-day moving average is $71.5. Moving averages help show economists the trend of a stock, or which direction it has been going in, but moving averages are slightly behind the current value of the stock. A moving average is very similar to a line of best fit in that it shows the trend of a data set, but the line of best fit shows the trend for all of the data and is current. The market cap (short for market capitalization), or current value of the company, for TWC is $26.717 billion. The price-to-earnings ratio is the current value of a share divided by the earnings over the past year (EPS). So, to calculate the price-to-earnings ratio for TWC, the current share value of $80.24 is divided by the current EPS of $3.97, which gives TWC a price-to-earnings ratio of $20.21. Since stock values changes rapidly throughout the day, the price-to-earnings ratio changes with it. TWC is currently doing well, so is this a good time to buy or sell shares of TWC?
June 2011The lawsuit against Coca-Cola over the false advertising of Vitamin Water as a healthy drink is now going to mediation. Mediation in a legal setting is when both parties involved try to work out a solution without going to court. The lawsuit is based on the fact that the name of the drink, Vitamin Water, leads consumers to believe that the drink contains only water and vitamins. Vitamin Water also contains sugar, but Coca-Cola argues that the nutrition label mentions the other ingredients, such as sugar. Coca-Cola also ran into problems in the UK with similar false advertisement of its product. Think about how this publicity could affect the stock prices of Coke.
At beginning of June, Sony’s official website was attacked by a group called “Lulz Security”. These hackers got access to people’ names, passwords, e-mails, home addresses and dates of birth. They posted other people’s personal information online for everyone to see. Sony would not comment on how the hackers got into their website, but quickly took down the possible vulnerability. Some of the Sony customers who had all of their passwords published, this hack may have impacted their daily lives. This was the second cyber-attack on Sony since April, which mostly affected Sony’s PlayStation Network which connects gamers around the world. Sony has gotten some bad publicity because of these security issues. How do you think a company’s stock prices will fluctuate when something like this happens?
According to the CEO of Netflix, the company is now looking at expanding to a third country. Asia has four possibly profitable countries: Korea, Indonesia, Japan and India. The company will be expanding later this year to another country, but they haven’t announced which one yet. Netflix has been a huge success in both Canada and the United States, but this is only the beginning. There is a global market for streaming videos, so in the future most countries will probably have Netflix available. Think about how this might affect this stock and others in the entertainment industry!
May 2011PetSmart reports 5 straight quarters of double-digit growth!The company just reported net income above Wall Streets expectations for the first quarter. Their net income rose to $70.9 million vs. $55.6 million during the same quarter in 2010. This is rise of 27.5%. Their revenue rose to $1.49 billion [G not bad! PetSmarts CEO, Bob Moran, stated that this success reflects the continued momentum and another step forward to becoming a best-in-class specialty retailer.Who are PetSmarts main competitors to watch?PetMed Express, Rite Aid, Walgreens CVS, Target and Wal-Mart
In the past, Netflix refused to entertain the idea of operating as a video seller, rather, they stuck to their initial business model as a renter. Studios though, time and again, have offered Netflix discounts on streaming rights if they are willing to operate as a seller as well as a renter. In 2008, Netflix sold its stock of used DVD's, so it's not an entirely new idea. Recently, Netflix has offered a roundabout way of selling videos - by linking to a site outside where the DVD can be purchased, even before these movies are available on Netflix (since Netflix must always wait two weeks after a DVD's release before making it available to stream). This method of video sales might be a nice compromise for Netflix to gain access to streaming content.
Did you ever think about how companies get their products displayed? One way is by using temporary store displays – they feature new items, but are easily discarded after the buzz fades. But what happens to those displays? For years companies have focused on recycling, which leaves the fate of the environment in the hands of retailers and consumers. Coca-Cola is making strides to change their approach to a closed-loop in which they take responsibility for sustainability. Coca-Cola has plans to launch entirely recyclable cardboard beverage displays, hoping to show consumers how dedicated they are to helping the environment. They truly mean to stick to their goals – Coca-Cola employees are responsible for properly recycling and even reusing components of these displays. They are taking a more active role as responsible and accountable suppliers and in doing so they are setting an example for others to follow.
Sony has released a new Playstation phone to rival the gaming features on current iPhones, Androids, and other smartphones. It has a full gaming keyboard, and while it provides for superior gaming, it ends up making the model look bulky, and the games it features don’t necessarily need this keyboard. While this phone isn’t threatening the competition as much as Sony would like, they will soon release an update to the PSP with online capabilities and a reduced price. This release is highly anticipated and may lead the way for newer model phones which eliminate the bugs and streamline the design.
Timewarner is offering free direct calls to Japan through next month. This might seem a little strange at first for a buisiness to offer something for free, but Timewarner is trying to help out in response to the earthquake and tsunami that struck Japan. In this way, they are hoping they can be of service to those affected by the natural disasters. They are paying for all calls to Japan made since tragedy struck, even those from before they instituted this policy. Digital phone customers do not have to change their accounts to take part in this offer. Timewarner is making sure to support its customers in their time of need, putting their concerns at the forefront of their agenda.
Disney has promoted a new senior VP of theatrical sales in North America, at the same time promoting another executive to the same position at the international level. These changes were made in anticipation of the retirement of their long-time president of distribution. The new executives will leave their old positions in distribution, working to bring Disney into the developmental markets of such countries as India, China, and Vietnam. These years of experience should help them take on the wider markets they now are responsible for overseeing.
Petsmart recently held their dachshund derby in Soulard to celebrate the 18th annual Beggin' Pets Parade. This was a fun way for them to raise awareness of causes that their company values. Dogs competed in categories such as 'Ballpark Franks' and 'Hot Dogs.' Registration was $10 per dog, and proceeds went to one of Petsmart's partners. This was the 17th annual derby held by Petsmart, and the event was successful for raising awareness of animal causes they support and gaining visibility.
Coke has completed a deal they begun three years ago with Honest Tea, a brand of juices and teas. They have purchased the remaining stake in the product, which they have long had the option to do. Their interest in this product is to heighten their stake in the market for soft drinks and the like. The founder of honest Tea will continue to run the business, reinvesting profit from the sale back into the company.
Nutrisystem is adding on to its line of weight-loss mobile applications. They now offer a free BMI check for Nutrisystem and non-Nutrisystem members alike. It looks like they are trying to get their name out there by providing reliable services related to their company mission. At the same time they provide up to date services geared to their customer base at the forefront of the technological frontier.
On February 3, Sony unveiled the official brand and logo for its 3D general entertainment television network in the US called 3net. Through a joint-venture with Discovery Communications and IMAX Corporation, Sony plans to launch the television network before the end of Spring this year. Some analysts speculate that the project will allow Sony to post profits slowly at first, as 3D television is not yet a widespread popular phenomenon, but many specialists are hopeful that 3net will benefit investors of Sony.
Sirius is expanding its range of broadcasting to the farthest corners of the country. Soon Alaska and Hawaii will have service to Sirius Satellite Radio through the use of repeaters. The Federal Communications Commission gave them the permission to expand their market into these areas, even though local broadcasters objected to the competition which they think would take away from their profits, reducing their ability to continue all of the local programming there. Up until now Sirius has only been available on the Internet in these regions, and Sirius feels that the consumers should have the choice of what they wish to listen to on the radio.
In a new focus on the quality of retail managers, the Coca-Cola president of Eurasia and Africa announced that Coca-Cola will partner with the Indian School of Business to start a retail academy. A six-month long retail-management program will be created to train professionals, while research opportunities will also be created, and an online school will be made available to students. Coca-cola is making sure their retail management professionals are well-rounded. Here’s one way they are looking to improve their business besides just considering the product. It’s nice to see that they are thinking of the future too, by offering training for students.
Netflix is in the process of making it easier for their customers to watch streamed videos, which has become a much more popular part of their business model than mail order DVD’s. They are working with major electronics companies in order to produce remote controls that include a ‘Netflix’ button. These should be available in the Spring, and with one-click will access a built-in program to instantly begin watching movies from the selection offered. What a way to make their name visible to both customers and potential customers!
Time Warner has not only released Disney channel on demand, but they have offered two for the price of none! They have also released the same channel and programs – in Spanish. There will be no extra charge for either of the kids’ channels for those who already subscribe. In this way they open their business up to an additional base of consumers, being more adaptable and diverse by appealing to the demand out there. This is a wise move for Disney because they serve more than 14 million customers, many of them centralized in areas with large Hispanic populations. In fact, Disney channel en español will also be offered on the Spanish speaking on demand offering. They will provide current and previous seasons of popular kid and pre-teen shows.
Netflix’s CFO left recently, starting rumors that the company was not doing well. He said that he left in order to start his own business though, and that he had been considering making a move in 2004, but didn’t want to leave back then because Netflix still needed him. Thus, as he has proven in the past, he wouldn’t leave Netflix during hard times. Instead he is happy to see the recent growth of the company, and leave it during a period of stability. He sold about 50% of his ownership of shares in the company, leaving himself with a nice sum of money, while maintaining a large stake in the future of the company.
Here’s a new way that Coca-Cola is using technology to better serve its customers. Coca-Cola will be instituting new beverage dispensers, able to hold 100 different types of products. Beverage combinations will be chosen by touch screen displays. The neat thing for the company is that they will be using Odyssey’s Athena Software, which will allow them to collect data remotely from these machines. The statistics they gather will really help them to make marketing and business decisions. They will also be able to fix problems with the machines from far away. The software will help them to increase both profit and customer satisfaction. It’s a win-win situation.
This month has started with a leap and abound, stocks are on the rise! The Dow jones Industrial Average witnessed its biggest jump in three months. It has risen almost 250 points. The major stock indexes were eased by the news that Europe’s debt might decrease, and that the tide of employment has swung for the better. As for other indexes, the Standard & Poor’s 500 indexes rose 25 points while the NASDAQ composite rose 51. Major industry groups, such as energy and technological companies led the rise. Let’s hope the remainder of the month has more good news to come!
Netflix just released a plan that involves only online video streaming. This shift to only online videos since the company began a decade ago shows how fast their consumer base has changed. More content is being watched on the internet than hard copies of DVD’s, so Netflix will spend more to license videos that can be streamed than they will spend on DVD’s. Netflix will now also raise the cost for plans that include hard copies of DVD’s. In this way, Netflix will perpetuate the changes that the market initially started. Netflix shares reached an all time high since this news was released. In two years, Netflix’s subscriber number is projected to double. For Netflix, embracing change seems to really be paying off.
November 2010Disney and Gowalla are partnering to provide Disney World guests with a new way to keep track of their memories! Scrapbooking just got a technology update and has become digital in order to enhance guests visits to Disney. Gowalla will award theme park guests with stamps depending on the attractions they visit. They can earn up to 100+, and the digital pages will provide them with a wealth of information about the attractions they are seeing. The two companies will also team up to customize particular types of park visits, for example, they could create a tour geared towards children below a certain height requirement (which might normally bar them from certain rides). The good news is that Gowalla wouldnt cost Disney customers any extra money, but should hopefully revolutionize how their park visits are organized and increase the attraction to the park overall.
Coca-Cola has turned its eyes toward its market in India. In that country, non-carbonated drinks are big sellers, so Coca-Cola India will be launching a new iced tea brand in the coming year. India as a country is a huge consumer base for Coca-Cola, so shifting to what the people there want should help increase their sales on a global scale. This will also help them to keep up with their competitors in the market.
Time Warner has expanded their services, focusing on the hospitality industry. Time Warner will now provide HD service for large-scale hotels so that guests can enjoy in-room HD cable, and hotels don’t have to worry about lots of equipment. This offer provides a way for the hospitality industry to gain a competitive edge in their industry, in a cost-effective way because they can specialize the channels they want to offer their guests. Time Warner has released this offer just before the 95th annual Hotel, Motel, and Restaurant Show, where it will present its comprehensive package to that industry. This is a good way for Time Warner to make itself visible to the public as well as the hospitality sector.
October 2010Netflix is growing at a super fast pace. It switched from being a movie rental company to an online video streaming company. This new model allows Netflix to expand outside of our country. Yet, the competitive advantage Netflix held is not so strong now. Now Netflix faces major competition from well-known online companies like Hulu or Amazon. These other companies are trying to establish themselves in the online movie market, which is an easy market to start competing in. Besides its competitors, Netflix also has to worry about purchasing the rights to online videos so they can sell them. Netflix will also have to pay more money to support their capability of selling their product to their increasing base of subscribers. Netflixs needs are changing, and what effect this will have is not yet certain.
Coca-cola’s vice president of marketing is looking toward a new approach for the marketing business. Since the economy is tight, not as many businesses have had extensive budgets for marketing. Thus, a new proposal is a pay-by-result model in which marketers get paid more for bringing increased business, but not as much if they fail to do so. As for the company’s marketing, this thought has been under consideration for months, but it is now becoming a reality. This is still a pretty unique decision but many companies are moving away from traditional forms of payment, and it remains to be seen whether this model provides a better opportunity for success and budgeting.
October 2010Projections for Siriuss sales are tied to the auto industry. Why is that? Most times, when high-end vehicles are sold, they are likely to have a trial subscription to Sirius satellite radio. These two goods are called complementary goods. The market acts as if the two are sold together. (Think about peanut butter and jelly [G if the price of peanut butter drops, people are likely to buy more of it, but they are also likely to buy more jelly to go with it). Even though the consumer who buys the car isnt paying specifically for the radio subscription, they are still paying for it when they pay for the car. Thus, while the economy may still be struggling, the auto industry has slowly improved. Sirius is benefitting from their sales.
In 2001, when AOL and Time Warner merged, it became the largest merger in the history of American business. Recently the CEO of Time Warner has made statements reflecting that this merger was a huge mistake. Throughout the past few years, the technology and television industries have been changing rapidly, and they haven’t always supported each other.
Taking two successful companies and bringing them together seems appealing, but makes it hard to stick to each company’s values and business plans. Ultimately, both of these companies have lost value since 2001, which gives us good insight into why they are no longer together. Now there is debate over whether the merger could have worked if the companies had focused on being innovative rather than large and powerful. Either way there is a lesson to be learned.
The CEO of Netflix is heading to Toronto this month to kickoff an online video service in the Canadian market. This is set to be Netflix’s first expansion outside of the domestic market. As a result of this anticipated launch, the local cable services in Canada are prepared to meet this new competitor and have recently been increasing their online video availability. For now, Netflix is only going to offer online video service in Canada, but it may choose to expand and offer DVD disk rentals in the future. This is a very exciting step for Netflix!
Disney and Time Warner made a deal that will bring more Disney shows to Time Warner subscribers. Other companies have disrupted TV services as they worked out these types of deals, but these two companies managed to negotiate without any interruption. The reasons the companies have struggled are that the TV networks like Disney are looking for more money from TV providers like Time Warner since programming costs are rising. The problem is that customers want to save money and would be faced with higher TV subscription prices. The peaceful deal means that the industry can avoid regulation during the deal making process, which had been proposed in the past for those in the TV industry.
This deal is important to the companies because it allows Disney to move its business online. Subscribers of Time Warner are given access to online sports channels. By expanding into the market for subscribers, Disney moves away from using advertisement to support its business and takes a bigger share in Time Warners market. Additionally, Time Warner received rights to sell some of Disneys shows on demand. Both companies shares rose.
Coca-Cola recently bought one of the four largest juice makers in Russia, Nidan Juices. Both Coca-Cola and their rival Pepsi Co. are looking overseas for markets where they can sell their products. Coca-Cola is still pushing to expand its line of non-carbonated drinks, so this move is big news because it works toward both. In the last 20 years, Coca-Cola has spend 2 billion dollars in Russia, and in the coming couple of years it plans to invest another billion. Over 6 months ago, Coca-Cola made its first move in acquiring Nidan. They finally sealed the deal and are hoping for great cost savings and revenue in Russia in the future.
Sony is gearing up for the holiday season! (It’s only summer now, but Sony has to start thinking about holiday sales early). Sony’s current e-reader (a product used to read books electronically) is looking to compete with Amazon’s new product. Sony is not simply going to cut prices to outdo Amazon, instead they are trying to make their product more advanced by including a touch screen. The company is taking a bit of a risk hoping that consumers won't be able to do without a touch screen, because when Sony’s product includes all of the features that Amazon’s does (plus its exclusive touch screen), it is much more expensive. Interestingly, Amazon doesn’t care so much about selling the reader as the electronic books that go with it, because that is where it expects to make its profit. Sony is concerned just with selling the readers, so hopefully it can obtain a share of the market.
Disney is sticking to their game plan! The Walt Disney Company hasn't been mousy when it comes to making deals lately.
Disney came to a deal with Miramax for $660 million and acquired Playdom for $563 million. These are just the latest moves the company has made to transform its business. The biggest deal came last summer when Disney acquired Marvel Entertainment for $4 billion.
Their Club Penguin and Toontown websites have already been very successful. A big company like as Disney can afford to take some chances in buying companies that smaller companies could not afford.
Disney's interest become a bigger part of the gaming business is no shock. Movies are moving online and entertainment is becoming more social and Disney is adapting to that.
They have re-designed Disney retail stores. The CEO of Apple, Steve Jobs, is on Disneys Board of Directors. He is helping them build a digital entertainment system called Keychest, which will allow Disney customers to out movies on their phones, game consoles, computers and T.V.
Disney shares are up around 7% so far in 2010. If you own shares in Disney, keep checking your portfolio to see the most current stock price! Or, maybe consider investing in this stock after you've done all of your research.
Bet on your pet...PetSmart is surviving the recession!
Not even one of the worst recessions could slow down the billions spent by Americans on their beloved pets. Owners spent $45.5 billion on their pets in 2009, up from $43.2 billion in 2008. The projections in 2010 call for another increase. The largest, publicly- traded pet supply retailer is PetSmart, which is a Stocks in the Future stock choice!
he stock has been strong, nearly hitting an all-time high in May 2010. Since spending on doggie toys is not slowing, it comes as no surprise that spending money on pets' health is following the trend. Animal-related stocks should hold up better than the overall market in the event of a new bear market.
PetSmart just announced that it will raise its quarterly dividend to 12.5 cents per share in the second quarter of fiscal 2010. This will be an income boost for the companys investors.
PetSmart continues to generate cash well above the amount needed for optimal reinvestment in our business, said the companys President Bob Moran, in a statement.
They are doing well! PetSmart posted revenue of $1.4 billion for a three month period, up from $1.33 billion for the same time period last year.
The 12.5-cent dividend will be paid on August 13, 2010 to stockholders of record at the close of business on July 30, 2010. If you own stock in PetSmart, youll see money added to your portfolio after August 13th!
Netflix shares stumbled on Tuesday, June 15th after a Stifel Nicolaus analyst downgraded the stock, citing potential competition from the Hulu.com website. The Analyst, George Askew, cut Netflix to "Hold" from "Buy" in a note to clients. But Netflix's movie subscription service has continued to attract droves of new customers. Its profit was up 44 percent in the first quarter. Still, Askew sees a rising competitor in Hulu, the online video site co-owned by News Corp., Walt Disney and General Electric 's NBC Universal. He expects the Hule site to launch a subscription service soon that will cost about $9.95 per month and provide a bigger selection of movies and TV shows than what is available on the site's free service. Netflix shares fell $3.18, or 2.5%, to $123.63 in afternoon trading. Still not bad considering that SIF students bought Netflix when it was approximately $17 a share!
On June 8th the Sony Corporation, Discovery Communications and IMAX Corporation announced that they have made a next step in their joint venture to develop the first 24/7 dedicated 3D television network. Last week they announced the joint venture. Now they have hired a President & General Manager, Tom Cosgrove, to oversee the venture. The TV channel will be high-quality and there will be shows about natural history, space, adventure, science and technology. They will also show Sony, Discovery and IMAX movies. Cosgrove will help the companies with getting consumers to buy the 3D televisions and giving the channel long-term oversight. Sony’s CEO said that the new channel will be “…a groundbreaking 3D television network. We're at a turning point in entertainment history…This is the start of something really big, and we're excited about delivering high-quality 3D entertainment to people every day, all day." The companies will offer cable and satellite companies the opportunity to bring the 3D television channel to their subscribers. Put on your glasses!
Netflix stock prices are spiking noticeably higher as rumors resurface that Amazon will buy out the company. These rumors have surfaced before though, and analysts in the past have dismissed them. While the idea is certainly possible, it seems unlikely. Netflix is not valued for its mail rental service, but for its streaming business. Netflix mostly offers older movies, because new releases are too expensive for it to offer. While Amazon offers mostly newer movies, nothing is really stopping them from offering older movies, and they wouldn’t need to acquire Netflix to do so. Still, Netflix has grown greatly since even just one year ago. In the first quarter, revenue grew 25%. It is definitely a stock to keep an eye on. In fact, it might not be such a bad idea to check your portfolios now if you own any Netflix stocks…
Petsmart and General Nutrition Centers, Inc. are teaming up to provide dietary supplements for pets! Petsmart will offer this new line exclusively in their stores and on their website next fall. The companies understand that pet owners want to be able to provide balanced nutrition for their pets. Both companies view the deal as strategic. Petsmart knows GNC is a leader in dietary supplements, so they can offer their customers a superior product. GNC got the idea to launch this line because many customers in their stores specifically requested products for their pets, and they know Petsmart has expertise in pet care as well as retail capabilities. The team sees this business venture as a long-term opportunity that will set them apart. Consumers will see a unique product backed by two brands they trust. It’s a win-win-win situation.
In an attempt to expand their base of customers, Nutrisystem is launching a Spanish version of their website. They hope that they will be able to provide weight loss information to the growing number of overweight Hispanic people in the country. With better access to weight loss and nutrition resources, Nutrisystem hopes to bring healthy lifestyle changes. Since weight is becoming a bigger problem among this group of people, Nutrisystem is making their product more available, by providing the program’s information in the languages their customers are most comfortable with.
Imax recently signed a pact with Warner Brothers (part of Time Warner) to release as many as 20 Imax films through 2013. This deal ensures a supply of films for the studio, even while release dates for the planned films are pending. This pact is the biggest deal that Imax has ever signed. Imax and Warner have released 25 films together in the past, and Warner Brothers was the first studio to support Imax back before it was digital, but was using expensive prints. Imax feels a special relationship to Warner because of the early support they received. Imax will still do business with other studios because they plan to put out 14 films a year, but a significant portion of their upcoming business is now reserved for Warner Brothers.
Disney is a frontrunner in promoting healthy lifestyles among kids, with a particular focus on healthy diets and regular exercise. Currently, Disney is joining forces with First lady Michelle Obama to fight against childhood obesity. The Walt Disney Company is working on the production of public service announcements featuring the First Lady and several popular Disney stars. Even Disney TV shows will release episodes dedicated to the healthy theme. Every division of Disney (including Disney Channel, Radio Disney, Disney XD, and Disney.com) will be joining in with this campaign, entitled “Let’s Move.”
Inside of every Petsmart store is a Petsmart Charities adoption center (that means 1,149 locations in the US and Canada alone). In 2009, more than 400,000 pets found homes through Petsmart Charities. At the end of this month, Petsmart will sponsor Petsmart Charities and more than 2,000 animal-welfare organizations throughout North America in a national adoption event. Their goal is to find homes for 18,500 pets currently living in shelters and rescue agencies. Petsmart Charities works with animal-welfare agencies and now provides them with more than $10 million in adoption-reward grants. Petsmart Charities will provide larger adoption-reward grants for the agencies participating in the weekend-long adoption event. Those agencies will also receive $35 for every pet they help find a loving home, which will help them increase the quality of life for the pets they still care for. A lot of pets will soon owe a lot of thanks to Petsmart for helping to make this event happen.
The United States Postal Service wants to stop delivering mail on Saturdays. While they would save money, Netflix would lose a lot of their business if they couldn’t use the mail service on Saturdays. For Netflix, it would mean less opportunity for customers to rent DVDs and it would also make Netflix customers less happy because they would have to wait longer to get their movies. Netflix is the biggest corporation that the Postal Service works with, but others would be affected too. Congress will get to vote on the final decision. If the businesses, unions, and patrons protest enough, the USPS will have to continue six-day delivery each week.
Time Warner is attempting to buy the film studio Metro-Goldwyn-Mayer (MGM). Having outbid its rivals with an offer of $1.5 billion, Time Warner still hopes to make the purchase. Time Warner is not worried that some other companies have withdrawn their offers for MGM. MGM is valuable for its film library, which has rights to such films as James Bond and 12 Angry Men. At the same time, MGM has $3.7 Billion worth of debt. Since Time Warner is involved in entertainment and media, rights to MGM’s film library could be profitable. Still, taking on MGM’s debt might be risky business.
This year’s Sony Ericsson Open is greatly anticipated by guests of the ATP and Sony Ericsson WTA Tours. The entertainment events heighten the excitement of the two-week tennis tours. Most of the events are open to the Miami public, who especially enjoy a fashion show as well as party tours, stage entertainment, and performances. The fashion show is put on by FILA, Sony Ericsson’s athleticwear sponsor. FILA will also make James Blake, Svetlana Kuznetsova, and Kim Clijsters available for questions on the entertainment stage. At the party tours, guests are privvy to live music, Sony Playstation competitions, and big-screen coverage highlights from the 2009 Open. Models hand out giveaways as athletes sign autographs. Throughout the tournament, entertainment events such as live music and zoo demonstrations will be presented to the crowd. Roger Federer will play the opening match as the world’s #1 ranked tennis player in the wake of these glamorous events.
Recent news revealed quite a secret of Grace Groner, a 100-year old woman who just died. She lived in a small one-bedroom home that was given to her in Chicago, Illinois. She purchased clothes at rummage sales, never owned a car, used mismatched dishes and watched T.V. on an old set. She never married and had no children. For 43 years, Grade was a secretary at Abbott Laboratories (a pharmaceutical company). In 1935, she bought 3 shares of the company’s stock for $60 each. Over time, she re-invested the dividends. When she died, her wisdom of keeping stocks instead of selling showed. Her 3 shares of stock now has value of $7 million! She left her money to Lake Forest College where she attended, along with her ‘fancy’ house that is now named Grace’s Cottage.
The Federal Communications Commission may be causing some problems for Sirius Satellite Radio in the next few years. The FCC plans to allow other companies to make broadcasts in the air space next to the blocks of space where Sirius makes its broadcasts. Although the spaces do not overlap, Sirius’s broadcasts would face interference. When the FCC originally sold the spectrum bordering Sirius, they said that no one else could make broadcasts that would interfere with Sirius Satellite Radio.
The other wireless carriers want to use more space now, and the FCC may allow them to do so, meaning that they would get in the way of Sirius’s transmissions. Sirius is afraid that if the wireless carriers are allowed to broadcast more, and they do end up interfering with satellite radio, Sirius’s 35 million listeners that are affected might simply drop satellite service. Of course, listeners could always bring up complaints when interference does happen, but Sirius wants to prevent the problem before it starts.
This week the Coca-Cola Scholars Foundation named their Class Scholars for the year. This Foundation provides corporate-sponsored scholarships to high school seniors so they can pursue a college education. Those who receive the scholarship are chosen for their academics, leadership, and contribution to their school community. This month, finalists will tour the Coca-Cola company headquarters in Atlanta and compete for scholarships of up to $20,000. The Foundation was established to commemorate Coca-Cola’s 100th anniversary and is now in its 22nd year. With the 2010 class, the Foundation will have provided $42 million in scholarships to 4,529 deserving students.
Time Warner is offering free services to its digital phone customers in Haiti until the end of this month. All direct-dial calls to landlines and cell phones will be free, to help in the relief efforts. Also, any charges that have been made on these services after January 12 will automatically be repaid back to customers. Customers do not need to make any changes; refunds for their bills will simply be credited to their accounts. Time Warner believes that this program will save their customers about $200,000.
Thomas Staggs used to be Walt Disney Company’s chief financial officer, but now he is Disney’s new theme park chairman. Mr. Staggs has traded in a life of business at Wall Street and work with numbers for a pair of Mickey Mouse Ears. He began Disney’s promotion for “Give a Day, Get a Disney Day” by presenting a crowd of people at Disney’s Epcot with sculptures of beloved Disney characters – made out of 115,000 cans of food! Those cans were donated to food banks. Disney hoped to inspire people to complete a day of community service with the Points of Light Foundation. For a limited time, Disney is offering park tickets to those who volunteer their time. So far about 600,000 people have done so.
Sony is creating a new reality show for the PlayStation 3 called “The Tester.” Eleven game fans will test out games all hoping to be the best game tester and to win the grand prize of getting a job as an actual game tester at Sony. Sony is doing this in an attempt to provide more than just games for their PlayStation users. They want the PlayStation to provide music, movies, and TV episodes, like “The Tester.” This show will start February 18.
Since 1928, Coca-Cola Company has partnered with the Olympic Games. In light of the upcoming 2010 Vancouver Olympic Games, Coca-Cola is launching an advertising campaign featuring a small group of U.S. Olympic Champions. They are known as Coca-Cola’s “Six-Pack” of athletes and are serving as “ambassadors of active living” to motivate people to live healthily. You may recognize Apolo Anton Ohno, Gretchen Bleiler, Angela Ruggiero, Evan Lysacek, and Keauna McLaughlin & Rockne Brubaker in some of the new Coca-Cola Olympic TV commercials. Coca-Cola is also releasing new collectible cans with silhouettes inspired by some of the most popular sports in the Olympic Winter Games such as figure skating, ice hockey, speed skating, and snowboarding.
Wall Street firms seem to be taking the hint from Washington and cutting back on employee bonuses this year; President Barack Obama called bank bonuses “obscene” twice in the past week. Some bank employees were receiving bonuses of over $5 million, which is upsetting for many taxpayers, considering that their taxes paid to get a lot of banks out of trouble in recent years. Bank employees, however, are used to receiving these bonuses so the Chief Financial Officer at Goldman Sachs says that he has tried to balance public needs and employee needs in order to be fair.
This spring, Netflix is going to expand their service. They will offer video streaming on Wii consoles so people will be able to use Wii to watch movies. It will not cost current Netflix members any more money as long as they already have a Wii and an internet connection. The company hopes that non-members who already have a Wii will be interested in the movie service and purchase membership. Netflix will send their members a special disk for streaming media that they just have to pop into their Wii. Netflix already offers this service through other video game consoles, some of which even offer high-definition streaming.
Sony announced official plans to launch a 3-D home TV channel in 2011. To do this, they will partner with Discovery Communications and the Imax Corporation. A recent study showed that 3-D TV may be the next big hit in home entertainment. Sony is following an announcement from the Walt Disney Company who announced it will release a 3-D TV channel soon. Sony and other TV manufacturers plan to produce special TVs with 3-D capability this year.
Since this year marks the beginning of a new decade, many are looking back on what has happened in the last ten years. It may be that this past decade was the worst ever for stocks. The S&P 500 had a negative total return for the first time in history. The S&P 500 measures the total return of the market, adding up the returns of all the stocks including the positives and negatives.
The Coca-Cola Company and the Ecoist Company have teamed up again to prevent unused Coca-Cola bottle labels from being dumped in landfills.This partnership will help Coca-Cola to reach its company's goal of producing no waste. Ecoist will take the used labels and sew them into handmade handbags that will be sold to the public. The companies will also plant a tree for every bag that is sold. The partners were once connected before, in 2007, and at that time were able to stop 1 million Coca-Cola labels from sitting in landfills. By re-starting their partnership, Coke hopes to inspire people to see the labels as new and usable, instead of seeing them as garbage.
In 2001, the merger of AOL and Time Warner into one company was called the “Deal of the Century”, but it lasted only a decade. As of December 9, 2009 the companies have officially split up into two separate companies. AOL will only be worth 10% of what it was at the height of AOL Time Warner’s success. When these companies first merged in 2001, AOL represented new media technology and Time Warner represented TV and magazine communication. Since then, both companies have lost money as newer technology, like internet advertising, has emerged. AOL still has time to improve their company's performance before "broadband" internet completely replaces AOL’s "dial–up" internet service. AOL's "dial-up" internet service still brings in 43% of their revenue. To mark this company split, AOL’s chief executive rang the NYSE’s opening bell on December 10, 2009.
This is the best year that gold has seen in three decades. There has been a large increase in the buying of gold due to the unstable financial market and the huge drop in the value of the US Dollar. Analysts expect gold to average out to about $1,070 in the next year. Furthermore, analysts would not be surprised to see an increase in the price of gold to $2,000 in the next five years. This rise in gold prices is the largest since 1979. Buying gold is a wise investment in these unstable economic times.
The U.S. Department of Education has started a new program called Race to the Top. This is a competition between the states in order to improve education systems and award money to those states who best improve their education system. States must implement methods outlined by the Recovery Act and must evaluate teachers and principals in many ways in order to gage the level of improvement. Measuring growth and achievement of students is strongly emphasized. There will be two rounds of competition. The first round is the application phase which will end mid-January. The second round will end in June 2010 and winners will be announced in September 2010. The winning states will receive money from the $4 billion that have been allocated to the Race to the Top Fund.
With this past Friday marking the start of the holiday shopping season, many people are hopeful that shopping will help to stimulate the economy. Sales did meet expectations with a 0.5% rise on Friday, but this may not be enough to boost the economy. Overall sales are expected to slip 1% in comparison with last year. However, online sales are very promising, showing an 11% jump on Friday. We will have to see how everything pans out after the holidays are over.
Goldman Sachs is preparing to provide assistance to small businesses, an effort that is in cooperation with President Obama’s plan to create job opportunities at small businesses. The company is doing this in order to dispel rumors that they are a greedy and provided fuel for the current credit crisis. Goldman Sachs has continued to pay their employees well through the economic downturn and this initiative would involve giving back to businesses that are not fairing as well.
A group of 20 nations has agreed to maintain economic stimulus efforts. As a result of this, the value of the dollar is decreasing, which will increase inflation and make it appear that the stock market is rising. Companies who have revenue abroad are much better off than those with more domestic sales due to the weakening dollar.
Gas on the rise
Retail gas prices are spiking to levels last seen in the heat of summer driving season, raising fears that consumers could cut back on holiday spending. But it hit the brakes as a barrel of oil tumbled more than 2 percent and the dollar strengthened after hitting a 14-month low. The average price for a gallon of regular gasoline rose for the 13th straight day, adding sixth-tenths of a cent overnight to $2.671, according to auto club AAA.
Federal Reserve Officials say that the banking system is still nowhere near back to being as strong as it was a couple of years ago. About three stocks have fallen for every one stock that rose on the New York Stock Exchange. We are better off than we were earlier this year, but to say that we are back to normal would definitely be a stretch. Wall Street analysts are hoping to see a significant increase in earnings in 2010.
Currently, the entire internet is based on Latin letters—the alphabet that we use. The non-profit group that oversees domain names - ICANN- is holding a meeting this week to discuss domain names. One of the key issues is whether to allow for the first time entire Internet addresses to be in scripts that are not based on Latin letters. That could potentially open up the Web to more people around the world as addresses could be in characters as diverse as Arabic, Korean, Japanese, Greek, Hindi and Cyrillic - in which Russian is written.
Loss at Verizon
In the midst of these rough economic times, some of the largest companies are feeling the pressure. Verizon Communications Inc. reported a 30 percent drop in third-quarter earnings Monday as it couldn't sign up enough new subscribers to offset higher costs from laying off workers and absorbing an acquisition. The nation's second-largest phone company had a downturn of its landline phone business and is putting more emphasis on cell phones and its fiber-optic FiOS TV and Internet service. Verizon said it is halfway through cutting the jobs of more than 8,000 employees and contractors by year's end.
In an attempt to stimulate the economy, President Obama decided to make getting money easier for small businesses at the beginning of this year. He greatly increased the amount of loans available for small businesses and waived all fees until the end of 2009. Now that it has been six months, people are starting to evaluate how successful the president’s plan has been. Although there is debate as to what specifically should be done to stimulate the economy, it seems that the majority agree that stimulating small business would create jobs and help to stimulate the economy as a whole.
The Long and the Short of It
In order to become an investor, you must first learn the lingo. Did you know that the phrase "the long and the short of it” came from financial markets? An investor is said to be “long” on a stock or have a long position when they own the stock and hope its value will increase. On the other hand, shorting is selling stock that you borrow from a brokerage firm, promising to return the shares at a later date. Investors do this with the hope that the value will decrease so that they will be able to keep the difference between how much they sold the stock for and how much they bought it back for.
Starting a New Business
Many people think that all small businesses are started with a “Eureka!” moment, when someone suddenly comes up with a great idea that turns out to be a huge success. This, however, is not always the case. In fact, the majority of small businesses are not started in this way at all. Many people want to have a small business before they get the idea for one. For the majority of people who don’t have the well-known “Eureka!” moment, there are some steps to follow in order to create a successful business. First, make sure you know what type of business you want to start. Then, brainstorm in order to get lots of ideas for your business. Figure out about which areas you are most knowledgeable. Then, do some research and make sure these ideas fit with what you thought about in the first step in order to cut down your list. Then, ask yourself and answer these three questions: Can I make this product or provide this service, and at what price? Do customers really want it? And how much will they pay? If anything doesn’t make sense, go back and pick a new idea. Finally, create a prototype and test it.
Limiting Credit Cards for College Students
A bill to limit credit cards for college students is currently in the works. If passed, this law would take effect in early 2010. Currently, students over eighteen are able to sign up and use credit cards on their own. This, however, is leading to a lot of debt for college students. The amount of debt that college students have has been increasing steadily since 2004. The bill proposes that people under 21 need parental permission in order to sign up for a credit card unless they can prove financial dependence or that they are financially literate. Making credit cards more difficult to obtain should help to decrease the amount of debt that college students have. One of the ways that students will be able to get a credit at eighteen is by demonstrating financial literacy. Education in financial literacy helps students to make the right choices once they go off and live on their own.
Stay in School!
In an economy like that of today, it is really important to think about the future. One of the most important things that you can do is to stay in school! Here are the top five reasons to stay in school:
Where to put your money now
(Fortune Magazine) -- Here we go again. Day after day, Americans are being bombarded by a relentless drumbeat of unsettling economic news. Don't let the doomsday headlines and the careening markets scare you. We've been through this kind of wrenching volatility many times before. These plunges are both predictable - because they're part of the bumpy ride that holding stocks is all about - and unpredictable, because you never know when they'll strike. "Investors should be grateful for bear markets, because without them stocks would offer bondlike returns," says Larry Swedroe. So while it's tough to see anything good about this rocky market while watching your portfolio shrink - remember that big selloffs present rare and essential buying opportunities, and the current one is no exception. http://money.cnn.com/2008/02/05/news/economy/recession_invest.fortune/
Starting a Business in a Down Economy
Sisters Jennifer & Joy started a business selling Cupcake Towers, resulting in a resounding “Why would you want to start a business right now?” After further consideration, one may realize that if you have a good product or service, now might be the best possible time to start a business. Here is why:
- There is less competition for workers right now so you can get good help for a reasonable cost.
- If you have a business idea that you can run on the side, it makes sense to start before you quit your day job.
- Technology has drastically reduced the cost of running a business.
- If you want to work from home, but can’t with your current job, starting a business that you can manage during the evenings may be a great first step.
- A side business provides great insurance against job loss.
What kind of business would you start? What does recession proof mean and how do you pick a company that is recession proof?
Coca-Cola's New Iced Tea Maker
The Coca Cola Company has decided to test a new machine that can brew more than 18 kinds of iced tea. If successful, Coca-Cola would hopefully gain an advantage over PepsiCo, which currently has more iced tea on the market. Coca-Cola is seeing a decrease in carbonated beverage consumption and thinks that offering more personalized tea choices would increase their sales. This machine would allow custom beverages based on the type of tea and sweetener at restaurants throughout the nation.
The Disney Corporation recently bought Marvel, the company that owns superheroes such as Spiderman and the Hulk. Marvel’s stock values fifty dollars a share, so Disney obviously feels that Marvel is a valuable addition to the company. This purchase will add a great deal in the form of movies, amusement park rides, and characters that are interesting to teenage boys. The potential movie characters, numbering almost five thousand, could really boost Disney ahead of its main competitors such as Time Warner and Universal Studios.
As expected, Sony Electronics unveiled a wireless, touch-screen electronic reading device, named the Daily Edition, that it will start selling in December.The $399 device, with a seven-inch screen, will make it easy to read newspapers and magazines.
[From NY Times]
NY Times: Twitter is a tool for people to read what people are talking about in real time and for businesses to reach customers and monitor what their customers are saying about them. Facebook seems to be very interested in those features.Last week, Facebook added two new, Twitter-like features. Users can now “tag” friends or companies that they mention in status updates, and they can use a pared-down version of the site called Facebook Lite that resembles Twitter’s stream of status updates.
Federal District judge overturned a settlement between the Bank of America and the Securities and Exchange Commission over bonuses paid to Merrill Lynch executives last year. They did not think the payment had "justice and morality.”
[From NY Times]
Sirius XM Is a Used-Car Salesman
In a deal with Audi announced this morning, SIRI will offer buyers of certified used cars an introductory three-month trial to Sirius' service. It announced a similar deal with BMW two weeks ago.
The move's a no-brainer for Sirius XM. If the used car has a satellite receiver -- something that becomes less likely, the older the vehicle -- everyone loses if it becomes a dormant in-dash paperweight.
Ideally, the buyer would notice the receiver and contact Sirius to inquire about its activation directly, but why chance it? Motivating a used-car salesperson with a financial incentive to promote satellite radio makes the hands-on education process a breeze. The margins won't be the same as leaning on leads, but Sirius XM can make up the difference in volume.
Besides, satellite radio could use the new revenue streams. Retail subscriptions have been shrinking for several quarters. Things have been rolling better at the dealership level, but Sirius XM suffered its first sequential dip there during the first quarter.
Until new-car sales bounce back, Sirius XM is devoting its marketing efforts to promoting its digital-streaming service through Apple's (Nasdaq: AAP) App Store. Just as RealNetworks (Nasdaq: NFLX) brokered a deal with TiVo (Nasdaq: TIVO) to offer its Rhapsody music subscription through digital video recorders, it would be a shock if Sirius XM doesn't find new partners beyond Apple to serve up its Web-served programming.
One can also expect more deals with sellers of certified used cars, as well as with used-car specialists such as CarMax (NYSE: KMX), in the future. If there's a dormant receiver out there on the open road, Sirius XM wants it activated.
[From Yahoo! Finance]
Analyst Admits to Being ‘Dead Wrong’ After Disney’s ‘Up’ Is Big Earner
“The recent success of Pixar’s ‘Up’ (well ahead of our forecasts) has renewed investor confidence in Disney’s creative capabilities,” he added. “Up” has so far sold $265.9 million in tickets in North America and $35.4 million overseas, where it has only begun to arrive in theaters.
But Mr. Greenfield stuck with his sell recommendation for the company’s stock, saying he believed the next 12 to 18 months would be “substantially more difficult for Disney than investors are currently anticipating.” He listed industrywide troubles with broadcast television and difficulty cutting more costs in the theme park unit.
Since the film’s release, other analysts have been heaping praise on Disney for allowing its Pixar unit to pursue “Up” despite the film’s commercial risk. “Continued affirmation of the Pixar acquisition as financially and strategically sound,” Anthony J. DiClemente of Barclays Capital said in a research note.
By BROOKS BARNES
Published: July 8, 2009, New York Times
Is Sony in the making of a PSP phone?
The Sony rumor that just won't die has reared its potentially beautiful head again: a PSP phone may be in the works. The latest back room rumblings come courtesy of Japan's Nikkei Business Daily, which says Sony is about to open up a new department that will explore a "cell phone-game gear hybrid," according to Reuters. Sony's secret department could begin work as early as July, and so far the PlayStation maker is declining to comment on the rumors.
The obvious target of Sony's rumored plan is Apple's iPhone. Since the introduction of the iPhone 3G, gaming has been front and center in Apple's iPhone-iTunes App Store ecosystem. Seven of Apple's top ten iPhone applications are games, and mainstream game publishers have for some time been incorporating the iPhone into their plans. Even the iPhone jailbreaking community is getting into gaming by using the iPhone to emulate original PlayStation games.
Sony, meanwhile, is struggling to maintain relevance with its mobile gaming platform, the PlayStation Portable. The company recently revamped the PSP and came up with a smaller, more compact device called the PSP GO. The new device swaps out the UMD drive for a 16GB HDD, and also has a 3.8-inch screen, Bluetooth as well as Wi-Fi connectivity, and a slide-out screen to reveal gaming controllers underneath. The PSP Go hits store shelves October 1.
Despite the improvements to the PSP, the new gaming machine is still limited when compared to the multifunctional iPhone. For whatever reason, Sony is reluctant to place the PlayStation name on a mobile device made by its cell phone partner Sony Ericsson. Tentative flirtations have begun with the Aino -- a device that can pull any content except games from the PlayStation 3 using Sony's Remote Play feature -- but what Sony doesn't seem to realize is that the PS3 is all about gaming. So without gaming integration, the Aino is really just another mobile device with Wi-Fi.
Other Sony brands like Walkman and CyberShot have already crossed over to Sony Ericsson devices, but for some reason the PlayStation moniker has not. What's strange is that a PSP phone is a no-brainer, especially since the iPhone continues to take bigger chunks out of the mobile gaming market.
But then again, Sony isn't known for its capability to detect changes in consumer behavior. Sony's Walkman lost out to Apple's iPod before the company ever knew what a click wheel was, Microsoft's Xbox 360 is outshining the PlayStation 3, and Nintendo is already beating out the PSP with its Nintendo DS lineup. A PSP phone gives Sony a shot to regain some lost ground; however, anything short of a fully functioning PSP combined with an intuitive smartphone just won't do. As Ray Kurzweil would say, "the singularity is near." Sony needs one device that can do it all, just like the iPhone can. The stakes are high, but if Sony does get it right and comes out with a true PSP phone, well, that's what you could legitimately call an iPhone killer.
Coca Cola(KO) Price Watch Shows Bullish Technicals-
Coca Cola closed yesterday at $49.55. So far the stock has hit a 52-week low of $37.44 and 52-week high of $55.84. Coca Cola stock has been showing support around 47.37 and resistance in the 50.73 range. Financial advisors are bullish (which suggests it is a good 'buy') and S&P gives KO a very positive 5 STAR (out of 5) strong buy rating. KO appears on the Investors Observer Analysts Favorites list.
Atlanta COCA-COLA PARTNERS WITH BET THIS SUMMER TO ASK AFRICAN AMERICAN TEENS "WHAT'S YOUR FORMULA?" That's the question Coca-Cola is asking as it launches its summer program celebrating African American teens' passion for self-expression and connectivity. Coca-Cola is partnering with one of Black Entertainment Television's (BET) most popular properties -- music series -- to bring the program to life.--Coca Cola Press Release
Walt Disney and Pixar's new 3-D animated thriller "Up", dominated box offices in it's opening week, creating an incline in the Disney stock. The 30 day change is calculated at +9.49%.
[From NY Times]
Time Warner announcement that it will spin off AOL was the much anticipated divorce filing for a multibillion dollar corporate marriage that came to symbolize an entire era in American business but that had long been acknowledged as a failure. ... Jeffrey I. Bewkes, Time Warner's chief executive, has set about paring down one of the world's largest media conglomerates...We're focusing the company now on its core content business - TV and film production, television networks and publishing."
[From NY Times]
BCC News - General Motors (GM) has announced plans to close up to 1,100 of its dealerships in the US as it desperately tries to cut costs and stave off bankruptcy. It also plans to cut ties with another 470 Saturn, Hummer and Saab dealers. Closures announced today represent one quarter of the dealership network. GM plans to cut the total number of dealers by 42% by the end of 2010.
Wal-Mart logged a profit of 77 cents a share in the quarter ended April 30, up from 76 cents a year earlier, matching analysts' forecast... But the reailer blames fluctuations in currency rates for hurting net sales for its international operations."
[From CNN Money.com]
The nation is becoming even more diverse: More than one third of its population belongs to a minority group, and Hispanics are the fastest-growing segment. The U.S. Census Bureau reported Thursday that the minority population reached an estimated 104.6 million - or 34% of the nation's total population - on July 1, 2008, compared to 31% when the Census was taken in 2000. Nearly one in six residents, or 46.9 million people, are Hispanic, the agency reported.
Even more telling for the future: 44% of children under age 18 and 47% of children under the age of five are now from minority families.
The price of oil is back towards $60 a barrel for the first time since November. Prices have shot up more than 70% since hitting their low point for the year in mid-February.
This week Tme Warner Cable eported strong earnings, in spite of the fact that it said recently that it needs a new business model to handle growing broadband demand.
Sirius XM sticks it to subscribers
The one and only satellite radio company's boasts of its ever-increasing subscriber base are gone now, and the decline is significant. The number floating around the Internet is a loss of 400,000 subscribers. That still leaves 18.6 million, but there's no way of knowing how many of that number are full-price-paying subscribers
China Huiyuan Rises on Report of Coca-Cola Stake Bid
Coca-Cola Co. recently announced that it is currently in talks with China Huiyuan Ltd., the largest supplier of juice in China, and may buy a minority stake in the Chinese distributor. Huiyuan' stock price rose 13% after the announcement was made, making it the biggest gainer on the MSCI Asia-Pacific Index.
Buckle Up, Fools: Sirius XM's Wild Ride Continues
Owning Sirius Satellite Radio these days is like riding a roller coaster.
Needless to say, Sirius (SIRI) has been "Sirius"ly struggling. With an impending declaration of bankruptcy and several failed attempts at refinancing, it almost seems like there is nowhere for this stock to go but down. Debt is piling up (over $400 million is due in at the end of December and an additional $174.6 million is due next week) and the corporation does not have the revenue to meet their financing obligations.
Time Warner’s ‘Watchmen’ Extends Hollywood’s Box-Office Streak
TWC brings another box office smash to theaters. Maybe there is hope afterall.
As you have been following stocks and keeping up with stock news, you have probably realized that a lot of the forecasts for the future of Time Warner has been kind of gloomy. Investors have started to get spooked, now less hesitant to buy stock than they have been in the past, and the company's stock price has plummeted over the last several months.
Buckle Up, Fools: Sirius XM's Wild Ride Continues
Owning Sirius Satellite Radio these days is like riding a roller coaster.
Needless to say, Sirius (SIRI) has been "Sirius"ly struggling. With an impending declaration of bankruptcy and several failed attempts at refinancing, it almost seems like there is nowhere for this stock to go but down. Debt is piling up (over $400 million is due in at the end of December and an additional $174.6 million is due next week) and the corporation does not have the revenue to meet their financing obligations.
Disney Offers Buyouts to Parks and Resorts Executives
Voluntary offer made to more than 600 executives. Offers set to expire February 6.
The Walt Disney Company, the world's largest theme park operator, announced yesterday that they have just issued 600 buyout offers to hundreds of theme-park executives. A buyout is a cash offer made by an employer to an employee to effectively "buy out" the rest of the employee's employment contract.
Sony May Suffer First Loss in 14 Years
Slumping sales, strong yen expected to weigh on electronics giant's annual results. Stock sinks 9%
Just as the title of this article would suggest, Sony may see its first significant loss in more than a decade. Shares of Sony tumbled 9%, slicing $2 billion off its market value to $22 billion, which has translated into losses for investors and directors alike.
Movies Instantly Streamed from Netflix to the TV Debut on the Xbox 360
More than 12,000 movies and TV episodes are available to watch instantly at no additional cost to current Netflix and Xbox Gold members.
Long-since the world's online movie rental service, Netflix is now expanding beyond the boundaries of its traditional charter. Having already made online movie-watching available to all subscribers, Netflix is looking towards a new medium: video game consoles.
Times Get Tougher for Time Warner
A bleak future for Time Warner lies ahead, but executives are hopeful.
Time Warner (NYSE: TWX) has been suffering for several months. With ever-falling stock prices, Investors and executives alike are "walking on egg shells," so to speak. Despite the solid earnings growth reported last Wednesday, many are hesitant to make positive projections regarding the well-being of TWX's future stock prices.
Coca-Cola Announces Plans to Place Calorie Information on Front of Packages in the U.S.
Coca-Cola North America today announced it plans to place calories-per-serving and servings-per-container information on the front of all packages they distribute in the U.S. Research shows that calorie information is an important tool to help people make informed decisions about the calorie contribution of foods and beverages that they eat or drink. This helps people maintain or achieve their healthy weight. It allows consumers to "Calorie Count", and make the decision whether they should or shouldn't drink a particular Coca-Cola product.
PetSmart Launches Disney Halloween Costumes
PetSmart recently announced the release of their new line of pet costumes for the upcoming Trick or Treat season. Having worked with Disney for the past several years, PetSmart is particularly porud of this year's line of outfits that include many of the classic Disney Princesses and some favorites like Tinker Bell.
House defeats $700B financial industry bailout
The House on Monday defeated a $700 billion emergency rescue package, ignoring urgent pleas from President Bush and other congressional leaders to quickly bail out the staggering financial industry.
Stocks Tumble Amid New Wall Street Landscape
A stunning makeover of the Wall Street landscape sent stocks falling rapidly Monday, with the Dow Jones industrials losing 500 points in their worst slide since the September 2001 terrorist attacks. Investors bounced back after a shakeup of the financial industry that took out two huge companies: Lehman Brothers Holdings Inc. and Merrill Lynch & Co.
Coca-Cola's Partnership with Pioco Wires 2008 Beijing Olympics
Hotspots around bustling olympic locations provide coke media content straight to cell phones and other bluetooth-enabled devices.
SIRIUS and XM Complete Merger
SIRIUS Satellite Radio and XM Satellite Radio today announced that they have completed their merger, resulting in the nation's premier radio company. The new company plans to change its corporate name to SIRIUS XM Radio Inc. The combined company's stock will continue to be traded on the Nasdaq Global Select Market under the symbol "SIRI." XM shareholders will receive 4.6 shares of SIRIUS common stock for each share of XM.
Sony profit tumbles, slashes full-year forecast
Sony Corp. Tuesday reported a 47.4% tumble in its fiscal first-quarter profit on poor sales for electronics and weak performance of its affiliates such as Sony Ericsson (Sony's mobile phone maker), even as its games division turned in a profit thanks to the PS3.
Coca Cola to invest $250 million in India
Revealing its plan to invest $250 million over the next three years in the country, beverage giant Coca-Cola said on Friday that India figured strategically in its global gameplan.
Boo Koo Holdings, Inc. Launches a New Product with Coca-Cola Bottling Co. Consolidated
Boo Koo Holdings, an innovative beverage company, has announced that its revolutionary new beverage BooKoo Burner+ will launch with Coca-Cola Bottling Co. Consolidated, the nation's second largest Coca-Cola bottler.