Posts by Jennifer Carinci
Apple (AAPL) sure had “a lot to cover” in its latest product event at Yerba Buena Center for the Arts Theater in San Francisco on Tuesday. Shares swung between positive and negative territory before closing lower by 0.3%. This after unveiling two new iPads -- an updated Mini and a full-sized iPad Air, which is thinner and lighter than the original. The new iPad Air is set to go on sale on November 1st and the new Mini will go on sale later in November.
Apple also revealed a line-up of new MacBook pro laptops and Mac Pro desktops, as well as the new operating system OS X Mavericks and 20 app updates that are available now to download for free.
Breakout spoke with millennial investor Brian Sozzi, CEO & chief equities strategist at Belus Capital Advisors, to figure out how Apple could win over our generation for decades to come. Here are three keys to the millennial heart.
1. Save us money
2. Smaller, lighter products
3. Give us toys!
In an 11th-hour agreement, Senate leaders announced they reached a short-term deal to reopen the government and raise the Treasury's debt limit. Timing of the votes in both the Senate and House are still being worked out. Here are the details of the plan we know so far:
*Bill would fund federal agencies at current spending levels through January 15th
*Borrowing authority would be extended through February 7th
*A committee would be established to address long-term fiscal solutions
Meanwhile, stocks rose across the board with all three major averages closing higher by over 1%.
The Yahoo Finance team along with top financial commentators sounded off on the deal ahead of the market close on Wednesday October 16th. That conversation can be found via Storify right here.
More from Breakout:
A taper fake out set the stage for a historic opening bell on Thursday morning after the Federal Reserve delivered a stunner on Wall Street, announcing that quantitative easing measures totaling $85 billion in monthly asset purchases will remain in place. The unexpected decision sent the Dow Jones Industrial Average (^DJI) and the S&P 500 (^GSPC) to close at fresh record highs on Wednesday, and the Nasdaq (^IXIC) closed at a 13-year high.
Stocks are flat in early trading today, while gold prices are soaring over 4% and the U.S. 10-Year Treasury yield is up to 2.74%.
U.S. stocks rallied 1% across the board after the Federal Reserve announced it will not reduce its $85 billion monthly asset purchasing program. The unexpected decision propelled the Dow Jones Industrial Average (^DJI) and the S&P 500 (^GSPC) to close at fresh record highs, topping the previous records of 15,658 and 1,709, respectively; both set on August 2nd. The Nasdaq (^IXIC) rose 1% to close at a 13-year high of 3,783. And gold prices saw even greater gains than stocks rising over 4% to $1,360 an ounce in after hours trading.
The Fed's decision came as a big surprise to many on Wall Street who were expecting a $10 billion to $20 billion reduction in monthly stimulus.
Bernanke didn't close the door on tapering. The central bank still has two more meetings before year-end. He stated:
The next FOMC meetings are scheduled for October 29-30 and December 17-18.
One of the most ominous market indicators has reared its ugly head this summer, flashing warning signs about the health of the U.S. stock market. The Hindenburg Omen is a highly technical indicator used to predict a major market crash.
It’s named after the infamous German aircraft that went up in flames in Lakehurst, New Jersey on May 6, 1937. The Hindenburg flight originated in Frankfurt, Germany and was generally considered a smooth ride, until unforeseen elements sparked a fire that quickly engulfed the craft while landing. Thirty-five of 97 passengers were killed. The tragedy, displayed on news reels across the world, destroyed public confidence about air travel. The exact cause remains a mystery to this day; much like its use as a stock market indicator.
2) New 52-week highs cannot total more than twice the number of new 52-week lows.
In another surprising turn of events in the battle to buy out Dell (DELL), the previously rescheduled shareholder meeting set to take place at 5pm today was delayed again. This after founder Michael Dell and Silver Lake upped their buyout bid from $13.65 to $13.75 a share and are trying to change the voting rules moving forward.
“Ignore the 10-cents, the 0.7% increase, that is not the news here, that is not the important thing,” says Aaron Pressman, technology reporter at Yahoo! Finance, in the attached video. “Below the surface, Michael Dell wants to change the rules of how the votes are counted in a way that would make a major difference and really probably shift it to an automatic win for him.”
As it stands now, shareholders that abstain from voting are counted as “nos” –meaning they’re against the buyout proposal. Michael Dell is instead trying to eliminate abstentions from the vote count.
Related: Dell vs. Icahn Boxing Match Delayed
The Dell shareholder vote is scheduled for August 2nd, for now. Stay tuned.
It’s all about revenue growth and mobile advertising for Facebook (FB), which according to consensus estimates, is expected to post 37% year-over-year sales growth for the second-quarter.
“When we think about a growth company, it seems to us like a lot of people don’t think Facebook is as ‘growthy’ as maybe it really is,” says Scott Kessler, head of technology research at S&P Capital IQ, in the attached video. “We’ve seen accelerating growth, we expect that to continue, and so it’s really important to focus on what they actually deliver.”
Analysts are expecting the social network to report a Q2 profit of $0.14 a share on revenues of $1.62 billion. Factset shows that among the 37 analysts covering the stock, 72% rate it a buy or overweight , 28% rate it a hold , with no sell or underweight ratings. The average price target is $32.75.
That’s not too bad for the company everyone loved to hate after its botched IPO in May 2012. Remember, shares debuted at $38 a piece. At that time, 53% of analysts had buy ratings, 27% hold , and 20% sell .
Facebook (FB) reports second-quarter earnings today after the market close.
More from Breakout:
The boardroom battle over Dell (DELL) continues after this morning’s shareholder meeting adjourned without a vote on the $24.4 billion buyout offer from founder & CEO Michael Dell.
Activist investor Carl Icahn and Southeastern Asset Management are leading the charge against the Dell proposal with their own bid for the company. Icahn says the offer, which includes a plan to buy back 1.1 billion shares at $14 each, is worth $15.50 to $18 a share.
The delayed vote is seen as setback for Mr. Dell and Silver Lake Management, whose proposal to take the company private was first put forth in early February.
“I think it’s really a story about institutional investors wanting to save face and wanting to sabotage this voting process,” says Lee Munson, chief investment officer at Portfolio LLC. “There’s some politics behind the scenes here.”
Icahn has openly said Mr. Dell’s offer undervalues the company and yesterday made his message loud and clear to the board. Here’s what he told Scott Wapner at CNBC’s Delivering Alpha conference:
Everyone loves a good turnaround story; assuming you catch the rebound, not the downturn. There’s high risk/reward investing in a company that was once left for dead, and being selective is a must. A beaten down stock price is not necessarily a bargain, but a potential rebound can pay off big.
“You have to be skeptical with turnaround stories, obviously these are companies that had near-death experiences for probably very good reasons,” says Kiplinger columnist Kathy Kristof, in the attached video. “It’s a riskier segment of the market, but that also often means you have more potential for profit.”
Kristof recently wrote about five comeback stocks that each have different reasons for the investor to believe in their turnaround plans.
First on her list is Beazer Homes (BZH) –the Atlanta-based homebuilder that almost went under during the Great Recession. Shares hit rock bottom at $1.25 in March 2009. They’ve since rebounded over 600%.
Serving Up a Deal
Stocks are under pressure this morning on news of a major shake-up in Portugal's government, escalating turmoil in Egypt, and more softness in Chinese manufacturing data. On the homefront, encouraging jobs data is helping to lift the tide. Weekly jobless claims fell 5,000 to 343,000 and the ADP employment report showed better-than-expected 188,000 private sector payrolls added last month, versus an expected gain of 160,000.
The data comes ahead of the critical Labor Department jobs report to be released at the end of the week. Consensus estimates are for 155,000 non-farm payrolls added in June versus 175,000 in May. The unemployment rate is projected to tick down to 7.5% from 7.6%.
“One of my biggest fears is that we’re going to get a four percent print on GDP and a 300,000 non-farm payroll number, which would cause the Federal Reserve to take the punch bowl away,” says Jeff Saut, chief investment strategist at Raymond James. “But I don’t think we’re going to get that in the near-term, I think the numbers will continue to grind marginally higher.”
But after the taper tantrum, it became pretty clear that jitters about scaling back QE will continue to impact stocks.