In terms of revenues, Amazon.com (Nasdaq: AMZN) is the classic growth stock. #-ad_banner-#Its sales have grown at least 20% for 20 straight years, and analysts think the winning streak will continue, with consensus projected sales growth of 20.7% this year (to an eye-popping $89 billion). Yet in 2015, this remarkable streak may come to an end, as sales growth slips to just 19%. (Elusive profit growth for Amazon is a topic for another day, though my colleague Serge Berger did take a look at Amazon this morning.) Amazon’s streak of 20% sales growth got me thinking. How hard is it… Read More

In terms of revenues, Amazon.com (Nasdaq: AMZN) is the classic growth stock. #-ad_banner-#Its sales have grown at least 20% for 20 straight years, and analysts think the winning streak will continue, with consensus projected sales growth of 20.7% this year (to an eye-popping $89 billion). Yet in 2015, this remarkable streak may come to an end, as sales growth slips to just 19%. (Elusive profit growth for Amazon is a topic for another day, though my colleague Serge Berger did take a look at Amazon this morning.) Amazon’s streak of 20% sales growth got me thinking. How hard is it to maintain a robust growth pace? Very hard, as it turns out. Of the 1,500 companies in the S&P 400, 500 and 600, only 16 of them are expected to boost sales at least 20% in 2014, 2015 and 2016.  Of these 16, special mention goes to Facebook (Nasdaq: FB) and Priceline.com (Nasdaq: PCLN). These companies are on pace for than $10 billion in sales by next year and are fighting the “Laws of Bigness.” (However, a massive wave of insider selling at Priceline last month led me to wonder if that company’s robust growth streak can really be maintained.)  The… Read More

With the tech stocks having taken a beating over the past month, a number of interesting buying opportunities are out there for long-term investors. And it’s not every day you get a second chance to invest in an IPO. #-ad_banner-#That’s because it’s unusual for a company to trade below its IPO price less than six months after debuting in the public markets. However, shares of Twitter (NYSE: TWTR) are now trading below the closing price from their IPO debut.  TWTR has been hammered this week since the company reported first-quarter earnings — shares have fallen to well below… Read More

With the tech stocks having taken a beating over the past month, a number of interesting buying opportunities are out there for long-term investors. And it’s not every day you get a second chance to invest in an IPO. #-ad_banner-#That’s because it’s unusual for a company to trade below its IPO price less than six months after debuting in the public markets. However, shares of Twitter (NYSE: TWTR) are now trading below the closing price from their IPO debut.  TWTR has been hammered this week since the company reported first-quarter earnings — shares have fallen to well below $40 a share as of this writing. The prime factor in the plunge may be that the quarter was the fourth in a row in which Twitter saw slowing growth. Analysts and investors have also focused on subpar engagement metrics. Total monthly active users came in at 255 million for the quarter, below expectations of 257 million, and Timeline views totaled 157 billion, compared with the consensus estimate of 165 billion.  However, the quarter wasn’t all that bad. Revenue and EBITDA (earnings before interest taxes depreciation and amortization) beat estimates, and Twitter’s forecasts for the second quarter and full year… Read More

We are halfway through earnings season, and according to FactSet Research Systems (NYSE: FDS), 73% of the companies in the S&P 500 have beat consensus earnings estimates, but only 53% have exceeded revenue forecasts.  #-ad_banner-#Considering that we are now in the fifth year of a cyclical bull market (arguably within a new secular bull market), it would not be unusual for companies to find it difficult to grow the top line much more, which after all the cost cutting of recent years would now be needed to expand net income and margins further. Case in point, Amazon.com (NASDAQ: AMZN), which… Read More

We are halfway through earnings season, and according to FactSet Research Systems (NYSE: FDS), 73% of the companies in the S&P 500 have beat consensus earnings estimates, but only 53% have exceeded revenue forecasts.  #-ad_banner-#Considering that we are now in the fifth year of a cyclical bull market (arguably within a new secular bull market), it would not be unusual for companies to find it difficult to grow the top line much more, which after all the cost cutting of recent years would now be needed to expand net income and margins further. Case in point, Amazon.com (NASDAQ: AMZN), which reported first-quarter results on Thursday after the close. The company slightly exceeded Wall Street’s lowered expectations with sales of $19.7 billion versus analysts’ forecast of $19.4 billion, which represented a 23% gain on a year-over-year basis. Earnings per share (EPS) of $0.23 were in line with estimates and up from $0.18 in the same quarter one year ago.  What’s concerning for investors is that revenue growth for the quarter was roughly the same as one year ago and significantly below the 34% growth in 2012 and more than 40% in 2011. Looking toward the second quarter, AMZN could be reporting… Read More

We’re right in the middle of earnings season, which means that most mid- and large-cap companies have reported results, with small-cap stocks getting set to move into the spotlight. #-ad_banner-#And thus far, two clear themes have emerged: Relatively few companies have been able to broadly surpass analysts’ forecasts — but one sector is building up an impressive head of steam, with strong earnings now and even stronger earnings to come. Bad Weather — Or End Of An Era? Of the more than 1,000 companies that have delivered quarterly results thus far, only 14 can be considered to be true… Read More

We’re right in the middle of earnings season, which means that most mid- and large-cap companies have reported results, with small-cap stocks getting set to move into the spotlight. #-ad_banner-#And thus far, two clear themes have emerged: Relatively few companies have been able to broadly surpass analysts’ forecasts — but one sector is building up an impressive head of steam, with strong earnings now and even stronger earnings to come. Bad Weather — Or End Of An Era? Of the more than 1,000 companies that have delivered quarterly results thus far, only 14 can be considered to be true “beat and raise” stocks. These are companies that not only deliver solid trailing results, but also offer solid enough guidance to lead analysts to raise their forward outlooks as well.  Specifically, these companies have: • Topped first-quarter earnings forecasts by at least 25%. • Seen their 2014 and 2015 full-year profit outlooks move higher since results were released. • Trade for less than 20 times projected 2015 profits, which is a likely cut-off point for remaining value to justify your time and energy researching them at a greater depth. Source: Yahoo Finance Over the… Read More

Momentum stocks have been hit especially hard over the past month. Most stocks related to the Internet has taken it on the chin.  With the lofty valuations for some of these tech stocks, it’s understandable that investors are booking gains and taking refuge in “safety” stocks. However, there are some stocks that are being pulled down unnecessarily.  Shares of TripAdvisor (Nasdaq: TRIP) are down over 15% over the past month, more than Amazon.com (Nasdaq: AMZN) over the same period. But TripAdvisor makes as much money on a net income basis as Amazon, and with a market cap that’s… Read More

Momentum stocks have been hit especially hard over the past month. Most stocks related to the Internet has taken it on the chin.  With the lofty valuations for some of these tech stocks, it’s understandable that investors are booking gains and taking refuge in “safety” stocks. However, there are some stocks that are being pulled down unnecessarily.  Shares of TripAdvisor (Nasdaq: TRIP) are down over 15% over the past month, more than Amazon.com (Nasdaq: AMZN) over the same period. But TripAdvisor makes as much money on a net income basis as Amazon, and with a market cap that’s only a tenth of Amazon’s. #-ad_banner-#With a rebounding economy, more people are looking to book vacations. TripAdvisor isn’t known for its booking capabilities, but it is known as the top place for research. Meanwhile, the likes of Priceline (Nasdaq: PCLN), Expedia (Nasdaq: EXPE) and Orbitz (NYSE: OWW) duke it out for customers looking to book trips. TripAdvisor is in a league of its own and has one of the largest online communities of travelers in the world.  Over 150 million reviews and opinions are posted on TripAdvisor.com, covering more than 3.7 million accommodations, restaurants and attractions. TripAdvisor already has… Read More

Peter Lynch talks about paying attention to the “power of common knowledge.” His advice is to notice which stores and products are most popular when you visit the mall. Then you do your research, and if the story checks out, buy the shares.  #-ad_banner-#A recent visit to my local Costco Wholesale (Nasdaq: COST) on a weekday afternoon was instructive. The parking lot was jam-packed and it took about 15 minutes to find a spot. Once inside, the aisles were also packed with shoppers. Oh, and despite the many discounts (or maybe because of them), I left with a… Read More

Peter Lynch talks about paying attention to the “power of common knowledge.” His advice is to notice which stores and products are most popular when you visit the mall. Then you do your research, and if the story checks out, buy the shares.  #-ad_banner-#A recent visit to my local Costco Wholesale (Nasdaq: COST) on a weekday afternoon was instructive. The parking lot was jam-packed and it took about 15 minutes to find a spot. Once inside, the aisles were also packed with shoppers. Oh, and despite the many discounts (or maybe because of them), I left with a bill well into the triple digits. My experience is not unique. With scores of customers pouring into Costco’s stores, it’s no wonder the company is doing well. Three factors seem to be driving Costco’s success: new store growth, new member sign-ups and strong existing membership renewals. Currently, there are 650 Costco stores worldwide, with the majority (462) in the U.S. Two years ago, management announced plans to open at least 15 new stores per year. This target has now doubled to 30. Membership plays an important role in Costco’s business model. Member fees enable the company to sell products at… Read More

We all naturally gravitate toward stocks that can make us money by moving higher in price. However, there are always stocks available to make us money when they move lower, and right now credit card purveyor Visa (NYSE: V) is one of them. Visa, as well as its peers, had a rough go of it in March, losing more than 15% from its March high to its low on April 11. (Even Discover (NYSE: DFS), which my colleague David Sterman profiled last week, wasn’t immune.) On the way down, Visa sliced through chart support at roughly… Read More

We all naturally gravitate toward stocks that can make us money by moving higher in price. However, there are always stocks available to make us money when they move lower, and right now credit card purveyor Visa (NYSE: V) is one of them. Visa, as well as its peers, had a rough go of it in March, losing more than 15% from its March high to its low on April 11. (Even Discover (NYSE: DFS), which my colleague David Sterman profiled last week, wasn’t immune.) On the way down, Visa sliced through chart support at roughly $212 and left its 50-day moving average in the rearview mirror. It also moved below its 200-day average before rebounding with the broader market.   #-ad_banner-#Financials as a sector continue to lag, so V is fighting an uphill battle that it is likely to lose. It is currently trading just below its former support level, which is now acting as resistance. Normally, we’d have to give the bulls the benefit of the doubt here because the stock did not fall soon after reaching this plateau. The reason we can’t is that volume during the rebound rally declined each… Read More

Market overreactions provide great buying opportunities — especially when they happen to large, consistently profitable companies.  #-ad_banner-#It happened to BP (NYSE: BP) back in 2011 with the Deepwater Horizon incident. Recalls have sent shares of Boeing (NYSE: BA), Toyota (NYSE: TM), and Tyson (NYSE: TSN) tumbling at one point or another.  And sometimes it takes years before a company can fully wash the stain from its brand image. But for time-tested companies, these sell-offs have been great buying opportunities. Unforeseen incidents and adverse events can happen almost anywhere — including at sea. And it’s safe to say Carnival… Read More

Market overreactions provide great buying opportunities — especially when they happen to large, consistently profitable companies.  #-ad_banner-#It happened to BP (NYSE: BP) back in 2011 with the Deepwater Horizon incident. Recalls have sent shares of Boeing (NYSE: BA), Toyota (NYSE: TM), and Tyson (NYSE: TSN) tumbling at one point or another.  And sometimes it takes years before a company can fully wash the stain from its brand image. But for time-tested companies, these sell-offs have been great buying opportunities. Unforeseen incidents and adverse events can happen almost anywhere — including at sea. And it’s safe to say Carnival Corp. (NYSE: CCL) has had its fair share of adverse events over the past couple years.  First, there was the Costa Concordia shipwreck that killed 32 people in 2012. Then, last year, the Carnival Triumph incident left passengers stranded for days in the Gulf of Mexico. Most recently, the Caribbean Princess had to return to its Houston port when 176 passengers became ill. Needless to say, this combination of events has left shares of Carnival underperforming the market. The cruise operator has lagged the S&P 500 by nearly 30 percentage points over the past three years.  New CEO,… Read More

Some stocks are considered good values, with attractive fundamental metrics such as a low price-to-earnings (P/E) ratio, a low price-to-book ratio, and so on. Some stocks are great technical plays, forming bullish double-bottom or cup-and-handle chart patterns.  Then there are some companies whose stocks that power higher because they have a genius CEO who brought a product to market at just the right time. Tesla Motors (Nasdaq: TSLA) is one of the latter — and the way I see it, you’d be crazy not to own the stock at current levels. The following price metrics should give you… Read More

Some stocks are considered good values, with attractive fundamental metrics such as a low price-to-earnings (P/E) ratio, a low price-to-book ratio, and so on. Some stocks are great technical plays, forming bullish double-bottom or cup-and-handle chart patterns.  Then there are some companies whose stocks that power higher because they have a genius CEO who brought a product to market at just the right time. Tesla Motors (Nasdaq: TSLA) is one of the latter — and the way I see it, you’d be crazy not to own the stock at current levels. The following price metrics should give you a sense of the power of this stunning all-electric car maker’s draw: — Up 12% in three months (through April 23 close) — Up 35% year to date — Up just shy of 300% in one year   — Up 756% since its June 29, 2010 IPO The numbers don’t lie. Investors have embraced Tesla CEO Elon Musk, the electric vehicle growth story and the enormous game-changing potential that this company brings to the automotive industry.  Tesla took another step forward this week, as it began selling its signature Model S sedans in the biggest auto market… Read More

As Steve Jobs prepped Apple (Nasdaq: AAPL) CEO Tim Cook to take the reins of the world’s most innovative consumer electronics company a few years ago, we can speculate on a likely bit of advice:  “Focus on the business, not on Wall Street.” #-ad_banner-#To be sure, Cook was getting an earful from Wall Street analysts and activist investors such as Carl Icahn a year ago, when shares were sliding toward the $400 mark. At the time, I noted that respected tech analyst Steve Milunovich of UBS said Apple’s high cash balances and slowing growth should fuel aggressive buybacks. CEO Cook… Read More

As Steve Jobs prepped Apple (Nasdaq: AAPL) CEO Tim Cook to take the reins of the world’s most innovative consumer electronics company a few years ago, we can speculate on a likely bit of advice:  “Focus on the business, not on Wall Street.” #-ad_banner-#To be sure, Cook was getting an earful from Wall Street analysts and activist investors such as Carl Icahn a year ago, when shares were sliding toward the $400 mark. At the time, I noted that respected tech analyst Steve Milunovich of UBS said Apple’s high cash balances and slowing growth should fuel aggressive buybacks. CEO Cook initially appeared uninterested in such a suggestion, though Apple has gone on to be an aggressive buyer of its own shares (which I’ll discuss in greater detail in a moment).  Cook instead aimed to shift investors’ focus to Apple’s legendary product innovation engine, dropping many hints in subsequent quarters that Apple’s engineers were developing powerful extensions to the core iPhone/iPad/iTunes/MacBook platform. And though we’ve been hearing about rumors of a new television ecosystem and a wearable iWatch, Cook is still running a business based on products developed under Steve Jobs.  It’s time for Cook to get cracking. Will the long… Read More