Posts by Jeff Macke

  • What new CEOs have done for Target, Microsoft & McDonald's

    Jeff Macke at Yahoo Finance 5 hrs ago

    I'm watching a couple of CEO turnaround trades today.

    I've touched on the idea briefly before, but I want to flesh it out ahead of a particular earnings report tonight. The idea isn't complicated but it's made me money pretty consistently over the years.

    Obviously simple and profitable is the holy grail of trading.

    I'm not talking about penny stocks in need of a superstar exec to save the day. This trade works best with blue chips where Wall Street, for whatever reason, has lost confidence in management. In those situations a change at the top can be a very bullish catalyst, sometimes even without a new executive waiting in the wings.

    Microsoft (MSFT) is a great recent example. Here's a five year chart. I don't have to tell you much about Microsoft beyond the fact that it used to be a monopoly and now it's known mostly for so-so software and clunky tablets. But check this out.

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  • Barnes & Noble cashing in on college book biz, Investors tase Taser

    Jeff Macke at Yahoo Finance 7 hrs ago

    Taser (TASR) is getting tased by investors to the tune of 13% after 4Q profits missed by a penny coming in at 9 cents a share. However revenue of $47 million came in ahead of estimates. The 40% gain in the stock over the past year left little room for any negative news. On a more positive note, if you read the papers you know law enforcement is beefing up on taser like products including body cameras and so called smart weapons. Today CEO Rick Smith reminded investors the company has 13 major cities using its products and they are in active discussions or trials with an additional 28.

  • Stock market records bring out the fearmongers

    Jeff Macke at Yahoo Finance 11 hrs ago

    The Dow Jones Industrial Average (^DJI) made a fresh high, joining its cousin the S&P 500 (^GSPC) and now we await the Nasdaq (^IXIC) to push above 5,048. Instead of celebrating prosperity here's what the media is likely to do which is the wrong attitude.

    Trot out the usual cast of fearmongers to tell everyone why a biblical crisis is in our immediate future. This week it was Nobel Prize winning Yale Professor Robert Shiller. Shiller is better known for his work on housing but he's also got a stock model called the Cyclically Adjusted Price-Earnings Ratio, or CAPE. According to Shiller's CAPE ratio stocks haven't been this expensive since the middle of last decade... that's right, before the Financial Crisis. In fact looking at the long-term CAPE you can see it peeking prior to the dot-com bubble bursting and the Great Depression.

     

  • HP becoming has-been of large cap tech, Facebook jumps ahead net neutrality vote

    Jeff Macke at Yahoo Finance 1 day ago

    Investors have just about had it with Hewlett-Packard (HPQ). The Dow (^DJI) member is down 10% after revenue of $26.8 billion missed analyst forecasts. Although adjusted earnings per share of 92 cents narrowly beat forecasts CEO Meg Whitman did cut full year profit goals blaming the stronger U.S. dollar because HP does get over 60% of revenues from overseas. While we can let Ms. Whitman use the currency card this quarter, the problem is HP's multi-year turnaround is just taking too long for many investors who are reluctant to even call it a turnaround at this point.

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    Retail and discretionary stocks are killing it but are they still a buy?

    How to bank hundreds of dollars more each month

  • 3 Things to watch instead of Yellen in today's trading game

    Jeff Macke at Yahoo Finance 1 day ago

    World markets are sitting at or near generational highs, driven by pretty dang solid consumer news, a dash of animal spirits and Fed Chair Janet Yellen's ability to play the obfuscation game just as well as Greenspan and Bernanke before her. Here's some stuff to keep in mind as we cross the halfway point of the week.

    #1

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    #2

    You want to know what really scares the Fed? Interest rates. Check out the yield on the 10-year bond over the last few days. It's back down below 2% and still in a downtrend as tracked by the CBOE Interest Rate 10-Year (TNX). The Fed's biggest fear is that they try to raise rates and the bond market doesn't go with them. The Fed like all financial institutions survives on the trust of its customer base. The Fed can't get out of sync with the bond market. So far, they aren't. Whether or not they lost control once a hike cycle starts is a problem for later this summer.

    #3

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  • How to handle market highs

    Jeff Macke at Yahoo Finance 2 days ago

    Breakouts everywhere!

    Charts aren't the be-all end-all of trading or investing, but they are undeniable. Managers can fudge numbers and accounting standards can vary to the point of noise in the hands of a good CFO. A chart, on the other hand, is simply a historical record of the price of an asset at a particular date. Time runs left to right, price goes up and down. If you buy something that subsequently forms a pattern moving from the lower left to the upper right corner you win.

    Everything else is just noise.

    So while Fed Chair Janet Yellen blathers on and computers trade back and forth based on key words I think this is a good time to look at the number of good looking charts we have out there and how to play them.

    Start with our buddy the S&P 500. The index for grown-ups is making yet another new high today. I'm starting with this one because it has the cleanest breakout. That means it also has the most obvious support. Remember when we broke out above the 2014 highs at 2090? That's now a bottom. That means technicians will be looking for buyers to come in if, and when, the S&P 500 pulls back to those old peaks.

  • 3 things to watch as you trade today

    Jeff Macke at Yahoo Finance 2 days ago

    Stocks are flatter than the Oscar telecast this morning as investors continue to play out the clock in what is turning out to be a sneakily huge February. Here's what you need to know as we get cranking up on a Tuesday:

    1. Stocks were lower yesterday except for the Nasdaq (^IXIC) which inched slightly green. It's now been almost two trading weeks since the Nasdaq closed lower on any given day. By that standard Monday was a crash. On the upside, that makes this turnaround Tuesday. We're now .8% from 5000 on the Nasdaq, at which point the world's problems will pretty much be solved.

    Related: Nasdaq 5000 and other market movers to watch this week

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  • State of the U.S. consumer will come into focus as more retailers report

    Jeff Macke at Yahoo Finance 3 days ago

    Any good fireworks show ends with the grand finale; a series of ever growing explosions that leave the crowd buzzing and wanting more.

    On Wall Street we don't have bombs literally bursting in air, but we do have earnings this week from Target (TGT), Macy's (M), J.C. Penney (JCP), Gap (GPS), Home Depot (HD) and Lowes (L). That's over a quarter of a trillion dollars in annual revenues. Pair those off with Walmart (WMT) last week and there's no excuse for not knowing exactly what kind of shape the US consumer is in by the end of this week.

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    A quick comparison of Target and Amazon's charts for the year (see left) tells you which model Wall Street prefers.

  • Nasdaq 5000 and other market movers to watch this week

    Jeff Macke at Yahoo Finance 3 days ago

    It's the last week of February and here's what you need to know:

    Did you hear the Nasdaq is near 5000? Apparently it's news to USA Today, Barron's, the Wall Street Journal and a slew of other media outlets who apparently don't read my stuff regularly. Welcome to the party, main stream media and lesser pundits.

    You'll hear a lot about the Greek deal driving this push higher. That's just silly. There are many details that further complicate the agreement. Specifically, it doesn't get ratified until the beginning of May and the whole process starts all over again at the end of June. That gives us a blissful two months of not hearing about Greece starting in about mid-April. If you want to trade off that kind of thing it's all you.

    Related: 3 things the market taught us this week

  • 3 things the market taught us this week

    Jeff Macke at Yahoo Finance 6 days ago

    Futures are up .75 points as we go to tape this morning. In the off-chance you haven't heard a member of the New York-dominated media complain about the weather yet this morning I'll point out that .75 is 25 basis points lower than the temperature in Times Square measured in Fahrenheit. In the name of a one-man effort to thaw 30 million icy hearts here are the best three things that happened this week.

    1. The Nasdaq broke out with authority Tech is on a tear, up seven straight days and 6% higher in the last month. Yesterday's close leaves Apple (AAPL) and the Pips just 1.5% from 5,000. A week ago I said it was a matter of when, not if. At this point it's not premature to start wagering on the arrival date. Think of it as a baby pool. For slightly personal reasons I'm placing my money on March 6th. That's two weeks from today. Media personnel: start planning your live specials accordingly.

    Related: How Walmart just rendered Washington even more useless