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The Dow Jones Industrial Average jumped this morning following a slight decline yesterday. Up by 103 points so far this morning, the index has surpassed another milestone with a new intraday high — which could very well be overshadowed by gains throughout the day. Positive news from various sectors of the economy has jolted investors back into action after several weeks of international and economic concerns.

Factory orders were up in the month of February by 3%, just slightly above the 2.9% increase expected by analysts. The overall gain was boosted by increased orders in the aircraft industry, while all other categories only gained 0.3%. Motor vehicle sales data released this morning showed a surge in buying activity as the economy continues to recover. Analysts at Edmunds.com raised the annual sales forecast for 2013 to 15.5 million vehicles on the strength of the sales data released by the car manufacturers. Ford had a 5.7% increase in sales during March, while Chrysler also boasted of a 6% increase. This is the best month on record for the Detroit Big Three since December 2007.

Dow winners
UnitedHealth Group is soaring this morning, up 6.77%, following a ruling from the Centers for Medicaid and Medicare Services stating that Medicare Advantage payouts will not be cut by the previously expected 2.2%, but will increase by 3.3%. The stock gained 3.1% yesterday after the ruling and continued to climb from there to a seven-year high. After the news, UnitedHealth was also upgraded by analysts at Raymond James to a “strong buy” from “outperform,” while other firms either reiterated their buy rating or upgraded the company to a buy. Health insurance stocks have gained across the board on the news, with other medical-related companies piggybacking on the ruling’s positive outcome.

Proctor & Gamble and Pfizer are both up this morning as well, both with a 1.4% improvement. On top of any benefit that the two companies may receive from the Medicare Advantage ruling, P&G has recently announced that 25% of its factories are now zero-waste. On top of the 45 currently designated zero-waste factories, another 20 are on the brink of the designation — a big boon for P&G, which is aiming for all its factories to meet the requirements by 2020. Pfizer hasn’t had the same great news for investors, as it recently failed its attempts to have lawsuits from Celebrex users dismissed. Along with its 10% decline so far in 2013, the drugmaker is enjoying any positive gains it can get its hands on.

When President Obama was reelected, shares of UnitedHealth and other health insurers fell immediately. Is Obamacare a death knell for health insurers, or is the market missing out on some of the opportunities the law presents? In this premium report on UnitedHealth, The Motley Fool takes a long-term view, homing in on prospects for UnitedHealth in a post-Obamacare world. So don’t miss out …read more
Source: FULL ARTICLE at DailyFinance

By Daniel Miller, The Motley Fool

Filed under: Investing

This month, when Ford releases its documents and reveals Alan Mulally‘s compensation, two things are guaranteed. One is that Mulally makes a lot of money, and the other is that people will complain that it’s too much money for one executive to earn.

My response to the complainers? Get over it.

In fact, let me show you why Mulally’s worth every single dollar as we review Ford under Mulally’s reign over the past six years.

History lesson
When Mulally first took over in September 2006, he had quite a hill to climb. Ford had long since deteriorated from the company that invented the assembly line and envisioned an automotive industry far ahead of its time. In 2006, Ford reported a $12.6 billion loss, almost $2,000 for every car or truck sold that year. That’s a staggering amount, and it was the worst loss in more than 100 years of Ford’s history. From 2006 to 2008, the company managed to lose a whopping $30 billion.

Now, take a look at how things have changed under Mulally.

The spike in 2011 was due to a one-time write-off, but you can clearly see the incredible turnaround. The stock price has reacted as well, gaining more than 50% since 2006.

From red to black
At the end of 2008, in the midst of a recession, Ford announced that it was confident it would return to profitability by 2011. It was hard to believe Ford at the time, since GM and Chrysler had asked Uncle Sam for billions to stay afloat, and Detroit’s Big Three could barely give cars away. Yet a mere year later, Ford was able to report its first annual profit – for the full year 2009 — in four years. It was two years ahead of schedule because of $5 billion saved in manufacturing and advertising cuts. It also benefited from a $1.3 billing profit from Ford Credit, which is now helping offset losses in Europe.

Let’s see why Mulally is responsible for those $5 billion in cuts and how it’s linked to his bonuses.

Mulally’s vision
Mulally put together a plan to unite the company under one mission and named the initiative “One Ford.” Here are two points from that plan, the first of which directly helped the company save billions.

1. Aggressively restructure to operate profitably at the current demand and changing model mix.
After the recession, Ford sold off slacking brands, helping it return to its core vehicle portfolio. In 2007, when Ford owned Volvo, Jaguar, Land Rover, and Aston Martin, its market share was 15.8%. After it went on a diet and cut all those brands, its share today sits at 15.5%. It saved a lot of operating costs and didn’t lose market share or net income.

In addition to trimming fat from the top-level brands, it also created efficiency at the most basic level. By the end of 2013, …read more
Source: FULL ARTICLE at DailyFinance

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