Tag Archives: Big Idea

Business, Finance, Occupation & Industry

Is the Google Stock Rally Over for Now?

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By Tim Beyers, The Motley Fool

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Each week, I endeavor to report the results of the Big Idea Portfolio, a collection of five tech stocks that I believe will crush the market over a three-year period. I’ve done it before; my last tussle with Mr. Market ended with me beating the index’s average return by 13.35%.

Real money was on the line then as it is now, which means any one of the five stocks you see below could cause me a lot of public embarrassment. This time, Google fell slightly in a big week for the market indexes. Facebook and Microsoft deserve most of the blame.

Google stock retreated about 80 basis points last week as thousands awaited Friday’s official release of Facebook Home for Android. That appears to have been an overreaction. As of Sunday, more than 3,000 had downloaded and rated the app at Google’s Play Store. Of those, nearly 1,600 give the app 1 out of 5 stars. Overall, they give it 2.4 stars.

“No widgets, kinda clunky, and pretty much just Facebook with access to your apps drawer. Meh, an unimpressive launcher compared to most others,” wrote reviewer Jeremy Noah, who called the app “good for Facebook-ophiles” after trying the app on his Samsung Galaxy S3.

The message? Facebook has much work to do before Home becomes a suitable substitute for Google’s existing Android interface. In the meantime, Microsoft has allied itself with 16 others to urge European regulators to take action against the search king for what it deems “predatory” efforts to control the market for mobile software and devices.

We don’t yet know how EU officials will respond to Mr. Softy’s urging, or Google’s own efforts to settle existing grievances. The resulting uncertainty appears to be weighing on Google stock.

What’s the Big Idea this week?
Elsewhere, a small move in Apple shares fell short of the market‘s overall rally, costing me  another 135 basis points in my three-year battle with Mr. Market. All four indexes reported strong gains.

This time, the Nasdaq led the way with with a 2.84% surge, followed by the S&P 500’s 2.29% rally, the Russell 2000’s 2.12% jump, and the Dow’s 2.06% gain, according to data supplied by The Wall Street Journal. Here’s a closer look at where I stood through Friday’s close:
 
Company Starting Price* Recent Price Total Return

Apple

$416.26**

$429.80

3.3%

Google

$650.09

$790.05

21.5%

Rackspace Hosting

$41.65

$48.40

16.2%

Riverbed Technology

$25.95

$14.60

(43.7%)

salesforce.com

$100.93

$169.52

67.9%

AVERAGE RETURN

—

—

13.04%

S&P 500 SPDR

$124.39**

$158.80

27.66%

DIFFERENCE

—

—

(14.62%)

Source: Yahoo! Finance.
* Tracking began at market close on Jan. 6, 2012.
** Adjusted for dividends and other returns of capital.

Notable newsmakers
Among the other tech stocks making news last week:

Business, Finance, Occupation & Industry

Is This Apple Stock Position Still Worth Holding?

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By Tim Beyers, The Motley Fool

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Each week, I endeavor to report the results of the Big Idea Portfolio, a collection of five tech stocks that I believe will crush the market over a three-year period. I’ve done it before; my last tussle with Mr. Market ended with me beating the index’s average return by 13.35%.

Real money was on the line then as it is now, which means any one of the five stocks you see below could cause me a lot of public embarrassment. Apple has caused the most trouble over the past several months. Count this week’s 3.5 percentage-point drop as the latest dip.

Apple’s stock price has fallen more than 33% over the past 12 months and is down 20% year to date, despite an 8% rise in the S&P 500. Holding in hopes of seeing CEO Tim Cook and his team make good on long-promised innovations in delivering televised entertainment has cost me dearly.

Bullish investors will nevertheless tell you that Apple stock looks like a bargain at current prices. They’re right. Google and Microsoft both trade at a noticeable premium to Apple when you factor in liquid assets:

AAPL Price to Earnings Less Cash TTM data by YCharts.

Selling now would amount to declaring that the Mac maker is incapable of generating even 10% annual earnings growth for the foreseeable future. Analysts are modeling for 18.9% annual gains over the next five years, according to Yahoo! Finance.

A decade of investing has taught me that winning is less a matter of wits and more a matter of willpower. Apple is testing my will to hold, so I shall.

What’s the Big Idea this week?
Elsewhere, Google and Riverbed Technology barely budged as my other two tech holdings plunged, costing me another 420 basis points in my three-year battle with Mr. Market. Among the indexes, only the Dow reported a marginal 0.19% gain.

This time, the Russell 2000 led the laggards with a 2.72% decline, followed by the Nasdaq’s 1.30% drop, and the S&P 500’s 0.59% dip, according to data supplied by The Wall Street Journal. Here’s a closer look at where I stood through Thursday’s close:

Company

Starting Price*

Recent Price

Total Return

Apple

$416.26**

$427.72

2.8%

Google

$650.09

$795.07

22.3%

Rackspace Hosting

$41.65

$46.86

12.5%

Riverbed Technology

$25.95

$14.96

(42.4%)

Salesforce.com

$100.93

$166.41

64.9%

AVERAGE RETURN

—

—

12.02%

S&P 500 SPDR

$124.39**

$155.86

25.29%

DIFFERENCE

—

—

(13.27%)

Source: Yahoo! Finance.
*Tracking began at market close on Jan. 6, 2012.
**Adjusted for dividends and other returns of capital.

Notable newsmakers
Among the other tech stocks making news last week:

  • Facebook took its fight with Google to next level by introducing “Home,” an overlay for Android phones that assumes control of a handset’s home and lock screen. An accompanying “cover feed” reveals what friends are up to while making chat accessible from any app or screen.

  • Tesla Motors soared this week after the company said Model S sales came in at 4,750, above the 4,500 projected earlier. The company also forecast a surprise first-quarter profit. Tesla next reports earnings on May 6.

  • Finally, in yet another …read more

    Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

This Apple Sell-Off Is Getting Out of Hand

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By Tim Beyers, The Motley Fool

Filed under:

Each week, I report the results of the Big Idea Portfolio, a collection of five tech stocks that I believe will crush the market over a three-year period. I’ve done it before; my last tussle with Mr. Market ended with me beating the index’s average return by 13.35%.

Real money was on the line then as it is now, which means any one of the five stocks you see below could cause me a lot of public embarrassment. This time, Apple slumped as salesforce.com soared.

Let’s address Salesforce first. Shares zoomed more than 7% to a new all-time high after the company reported better-than-expected fourth-quarter results. Revenue came in nearly $4 million ahead of estimates while per-share earnings beat the consensus by more than $0.11.

Salesforce also reported a 59% year-over-year increase in contracted work in the pipeline — now $3.5 billion, up from $2.2 billion at this time last year. Current deferred revenue (i.e., work billed but not yet recognized on the income statement) rose 39% as a growing number of large companies deploy software in the cloud.

And yet Apple remains the bigger story. The stock touched a 52-week low Friday only to see even lower prices in Monday trading. Skeptics have taken to the markets to proclaim the end of Apple’s dominance of the smartphone and tablet markets. Others simply disapprove of CEO Tim Cook’s tightfistedness when it comes to the Mac maker’s growing cash pile.

I’ve no complaints. In fact, I’ve been thinking of adding to my Apple stake for a while. If I’ve yet to pull the trigger it’s because there are so many interesting opportunities right now. And yet I can’t help wondering if I’m missing out: at just 8.4 times next year’s average earnings estimate, today’s buyers may be getting the earnings potential of Apple’s “Next Big Thing” — whether it’s  a TV, a watch, or a cheap iPhone — for free.

What’s the Big Idea this week?
Fortunately, Salesforce’s surge more than compensated for Apple’s apathy last week. My five tech stocks cut Mr. Market’s lead by 118 basis points from the week prior. Not bad for these turbulent times.

Indexes mostly improved. All but the small-cap Russell 2000 moved higher, led by the Dow Jones Industrial Average and its 0.64% gain. The Nasdaq and S&P 500 eked out gains of 0.25% and 0.17%, respectively, as the Russell fell 0.16%, according to data supplied by The Wall Street Journal. Here’s a closer look at where I stood through Friday’s close:

Company

Starting Price*

Recent Price

Total Return

Apple

$416.26

$430.47

3.4%

Google

$650.09

$806.19

24%

Rackspace Hosting

$41.65

$56.11

34.7%

Riverbed Technology

$25.95

$15.15

(41.6%)

Salesforce

$100.93

$182.00

80.3%

AVERAGE RETURN

—

—

20.16%

S&P 500 SPDR

$124.94**

$152.11

21.75%
DIFFERENCE

—

—

(1.59)%

Source: Yahoo! Finance. *Tracking began at market close on Jan. 6, 2012. **Adjusted for dividends and other returns of capital.

Notable newsmakers
Among the other tech stocks making news last week:

News, Politics, Government

A 'Big Idea' That Delivered

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By Ken Makovsky, Contributor

What is your favorite “Big Idea?” More fundamentally, do you know how to define a “Big Idea?” Well, today, at Makovsky, we start an eight-week (one class per week) agency-wide instructional program called “Managing the Creative Mind: In Search of the Big Idea.” Even we, who use “Big Ideas” regularly, need to review the elements from time to time, particularly in this digital age. …read more
Source: FULL ARTICLE at Forbes Latest