Saturday, May 30, 2015

Is The Downtrend Finally Broken On Jive Software?


  • Jive Software easily beat Q1'15 analyst forecasts.
  • The business collaboration software firm is finally starting to gain traction with customers via new apps with lower prices points.
  • The stock is on the verge of breaking a long three-year downtrend.
When Jive Software (NASDAQ:JIVE) went public back at the end of 2011, the company was proclaimed as the social platform for the business community. Jive though failed to gain critical mass and still today hasn't reached 1,000 customers.

Read the full article on Seeking Alpha.


Disclosure: Long JIVE. Please review the disclaimer page for more details. 




WPX Energy - Focus On Natural Gas Considering These Implications For Oil


  • WPX Energy continues making progress towards becoming a diversified energy producer.
  • The E&P firm is still more impacted by the price of natural gas taking a big hit from the price decline in that commodity.
  • The company has some interesting negative implications for oil.
  • Investors should remain focused on WPX Energy for the catalysts related to natural gas.
WPX Energy (NYSE:WPX) surprised investors with a second straight quarterly profit that substantially beat analyst estimates. As with all other E&P firms, WPX faces a tough market with the collapsing community landscape. The energy producer is making huge progress transitioning to liquids production, but it still faces a natural gas future.


Read the full article on Seeking Alpha.


Disclosure: Long WPX. Please review the disclaimer page for more details. 



Friday, May 29, 2015

Shake Shak: Expecting Too Much


  • Shake Shack finally cools off after an incredible surge in the stock price.
  • The fabulous burger-joint has a valuation multiple only matched by fast-growing tech stocks that produce revenues gains of over 100%.
  • Investors must not get caught up in the excitement of the Shake Shack concept and focus on the absurd valuation compared to other top fast-casual restaurant concepts.
After a massive month-long run, Shake Shack (NYSE:SHAK) finally took a step back. The fabulous burger joint has an enviable customer base and strong growth prospects, but the recent rally appears more fluff than reality. The stock started April below $50 and surged above $95 last week.

Read the full article on Seeking Alpha.


Disclosure: No position mentioned. Please review the disclaimer page for more details. 




Wednesday, May 27, 2015

Michael Kors: Falling Apart At The Seams


  • Michael Kors reported mixed results and provided a major guide down for the current quarter.
  • The Coach example suggests that Michael Kors is unlikely to rebound from the collapsing stock price anytime soon.
  • Limited downside risk is not a good enough reason to own the stock.
With Michael Kors (NYSE:KORS) down nearly 25% in trading on Wednesday following a weak quarterly report, investors that bought shortly after the IPO back in early 2012 now have limited gains. The large success of Michael Kors along with the recent resilience of Coach (NYSE:COH) might highlight a saturated market for high-end handbags and related accessories.

Read the full article at Seeking Alpha.


Disclosure: No positions mentioned. Please review the disclaimer page for more details. 




Friday, May 22, 2015

Southwest Airlines - The News That Wasn't


  • Southwest Airlines plunged on fears of capacity additions.
  • The market apparently over reacted to news of a slight capacity increase from previous expectations.
  • The fears of a pricing war provide an opportunity to own one of the best airlines.
The airlines were absolutely crushed during trading on Wednesday. Several events collided to create a panic causing some of the airlines to plunge up to 10%. Whether or not the news of the day was material, the media was full of market pundits referring back to the airline industry of old without justification.

Read the full article at Seeking Alpha.


Disclosure: Long AAL. Please review the disclaimer page for more details. 



Tuesday, May 19, 2015

Zynga: Stay Focused


Summary

  • Zynga continues making progress towards shifting to a mobile game developer.
  • The downshift in web game revenue is masking the progress made by the previous CEO.
  • The company remains attractive at these valuations based on strong financial assets and game franchises.
With all of the assets of Zynga (NASDAQ:ZNGA), the biggest fear is a lack of focus at the game developer that slowly burns the cash balance. The company has spent the last few years building up new game categories and switching CEOs to only end up back in the same place.

Read the full article on Seeking Alpha.


Disclosure: Long ZNGA. Please review the disclaimer page for more details. 



Monday, May 18, 2015

GSV Capital: Catalysts To Reduce NAV Discount


  • GSV Capital reported its highest NAV in history, but the market hardly noticed based on the lack of analyst participation on the earnings call.
  • The resolution of the tax-exempt status provides a major catalyst to increase value and reduce NAV discount.
  • The stock provides intriguing value at $10 with potential other catalysts to increase the stock price.
After another quarter of less than expected asset growth, GSV Capital (NASDAQ:GSVC) has absolutely lost investor interest. The investment fund reached the highest NAV in its short history, yet the earnings call involved only one analyst. The NAV amount isn't appreciably higher than previous quarterly levels, suggesting the slow growth isn't enough to keep analysts' interest, even though it does continue to grow.

Read the full article at Seeking Alpha.


Disclosure: Long GSVC. Please review the disclaimer page for more details. 




Saturday, May 16, 2015

Amazon: Don't Fight AWS Momentum


  • Amazon's momentum over the surprise AWS operating profit continues to grow with the recent analyst upgrades.
  • Margin improvements and earnings forecasts don't match the excitement over the prospects of the AWS segment.
  • Investors should ride the momentum higher, despite the continued overvaluation of the stock.         
The recent Q1'15 results for Amazon (NASDAQ:AMZN) brought excitement to the market over the positive numbers from the Amazon Web Services segment. The ironic part, though, is that the better than expected numbers for AWS were offset by mixed numbers for the retail business.

Read the full article at Seeking Alpha. 


Disclaimer: No position mentioned. Please review the disclaimer page for more details. 



Friday, May 15, 2015

How The Delta Air Lines Capital Return Plan Stacks Up



  • Delta Air Lines announces an increased capital return plan.
  • The new plan includes a major boost to the dividend and stock buyback plan.
  • The new Delta Air Lines plan still fails to push the yield to the highest in the market unless the airline accelerates the plan.
Prior to the open, Delta Air Lines (NYSE:DAL) announced a major increase to their capital return plan. The airline was already ahead of the industry and especially the legacy airlines in returning capital to shareholders. This new plan greatly expands the previous plan.

Read the full article on Seeking Alpha.


Disclosure: No position mentioned. Please review the disclaimer page for more details. 



Thursday, May 14, 2015

Clean Energy Remains A Margin Story That Isn't Improving


Summary

  • Clean Energy continues struggling to make financial progression.
  • The company runs a low-margin business, but it continues to sell investors on a "concept".
  • The stock remains a momentum story that investors should exit when the recent run ends.
The stock of Clean Energy Fuels (NASDAQ:CLNE) made an incredible run over the last few months on what appears more momentum than reality. The company missed Q1 estimates and again pushed the quarterly loss back to the $0.30 level. Amazingly the stock didn't sell off on this news. In addition, investors appear to have mostly brushed aside the scathing report from The Street Sweeper. The stock is amazingly close to the highs for the year.

Read the full article on Seeking Alpha.


Disclosure: No position mentioned. Please review the disclaimer page for more details. 




Wednesday, May 13, 2015

Verizon: Is AOL Worth The Cash?


Summary

  • Verizon agreed to purchase AOL for $4.4 billion in cash.
  • The deal adds debt to an already large debt load.
  • AOL doesn't appear to add the exciting assets suggested by the press release with the company offering limited growth.
  • At this point, any deal adding debt isn't appealing, but the materiality of the deal doesn't adjust a breakout forecast for Verizon's stock.
The validity of Verizon Communications (NYSE:VZ) purchasing AOL (NYSE:AOL) is very much a debate, but the one part missing from those discussions is the use of cash for the deal. One of the biggest concerns with an investment in Verizon is the debt load created from the transaction with Vodafone (NASDAQ:VOD). The basis of the AOL deal is better sculpted on whether it is worth the cash.

Read the full article at Seeking Alpha.


Disclosure: No position mentioned. Please review the disclaimer page for more details. 




Monday, May 11, 2015

Top 10 Net Payout Yield Stocks For May 2015


  • The top ten net payout yields underperformed the market in April due to a couple of weak individual stocks.
  • The top ten net payout yield stocks averaged yields of 13.6% to start May.
  • Motorola Solutions continues to hold the highest yield now at 25.8%.
This article is a continuation of a monthly series highlighting the top net payout yield (NYSE:NPY) stocks that was started back in June 2012 (see article) and explained in August 2012 (see article). The series highlights the best stocks for the upcoming month utilized in part to make investment decisions for the Covestor model that has beaten the S&P 500 for four consecutive years. Please review the original articles for more information on the NPY concept.

Read the full article on Seeking Alpha.


Disclosure: Long HIG, MSI, NLY, NOC, NTAP, TRV, VIAB.



Friday, May 8, 2015

Sprouts Farmers Market Disappointment Leads To Opportunity


Summary

  • Sprouts disappoints with Q1'15 earnings.
  • Sales and margins were hurt by the West Coast port slowdown.
  • The natural grocer is still generating solid comp sales growth and maintains a long-term growth opportunity suggesting buying the stock on a dip.
   Sprouts Farmers Market (NASDAQ:SFM) reported quarterly numbers after the close on Thursday that missed analyst and company forecasts. Probably even worse, the disappointing numbers came after the leading pre-IPO shareholder in Apollo Global Management (NYSE:APO) dumped their final shares in early March at $35.30. The stock is likely to trade weak with concerns that the "insiders" knew of the impending weakness.


 Read the full article on Seeking Alpha.


 Disclosure: No positions mentioned.  Please read the disclaimer page for more details.

CenturyLink Stock Dip Leads To Attractive Capital Return Rates


Summary

  • CenturyLink continues returning large levels of capital to shareholders.
  • The recent stock declines has pushed the dividend yield above 6%.
  • Investors should buy stock alongside the company at the current levels around $35.
  CenturyLink (NYSE:CTL) traded down following a mixed Q1'15 report. As usual, the quarterly numbers aren't monumental considering the telecom has limited growth and relatively stable operations. The bigger focus is always the capital returns and cash flow generated by the telecom assets.

 Read the full article on Seeking Alpha.


 Disclosure: Long CTL. Please read the disclaimer page for more details.

Is Verizon Finally Set For A Breakout?


  • Verizon is set for a breakout above the $50 range that has held as resistance since 2013.
  • Earnings growth and time has reduced the forward PE ratio to a more reasonable 13.
  • Investors can now enjoy the 4.4% dividend yield with expectations of solid capital gains.
   After a couple of years of trading in a tight range, Verizon Communications (NYSE:VZ) finally appears ready for a breakout. While investors spent the last couple of years clamoring over the stock due to a high dividend yield and the excitement over 4G, the stock was extremely expensive when we turned bearish on it back in July 2012 (see articles here).


  Read the full article on Seeking Alpha.


 Disclosure:  No positions mentioned.  Please review the disclaimer page for more details.

Thursday, May 7, 2015

Finally Some Good News From Transocean


Summary

  • Transocean reported a huge Q1'15 beat.
  • The deepwater driller produced impressive revenue efficiency and cost controls for the quarter.
  • The significant revenues obtained from midwater and deepwater floaters are a major concern going forward.
   After endless news of scrapping rigs and CEO changes, Transocean (NYSE:RIG) finally reported some good news. The deepwater driller entered the industry downturn with an outdated fleet and management has slowly reacted to the predicament. The Q1 results provide some hope for a turnaround due to solid operational improvements.


 Read the full article on Seeking alpha.


 Disclosure: No positions mentined. Please read the disclaimer page for more details.

Sprint's Big Mistake


Summary

  • Sprint reports dismal quarter with declining postpaid phone users and ABPU.
  • The company continues burning cash at an alarming rate causing several analysts to question its cash position.
  • Investors should continue avoiding the stock until trends improve.
Another quarter and Sprint (NYSE:S) still isn't making any real progress toward growing postpaid phone subscribers. The wireless provider has aggressively spent on promotions, but it has made a huge mistake in thinking the high-quality 4G, smartphone customer would switch networks for a pricing gimmick.

Read the full article on Seeking Alpha.


Disclosure: No positions mentioned. Please review the disclaimer page for more details. 




Wednesday, May 6, 2015

Lending Club: Stretched Value Mutes Strong Q1 Results


Summary

  • Lending Club has reported strong Q1'15 earnings.
  • Despite raised guidance, the stock trades at valuations that are still stretched.
  • Investors should continue looking for a better entry point.
   As expected, Lending Club (NYSE:LC) produced enormous growth in Q1 that exceeded analyst expectations. Even after this growth, the issue still remains that the stock is restricted from heading higher due to the rich valuation that now sits close to $7 billion.


 Read the full article on Seeking Alpha.


 Disclosure: No positions mentioned. Please read the disclaimers page for more details.

Tuesday, May 5, 2015

Don't Make These Stock Moves Into A Bad Habit


Summary

  • Habit Restaurants reported strong Q1'15 earnings.
  • The company surged to nearly $40 after the release of the turnaround plan by McDonald's.
  • Investors shouldn't chase the stock as the PS multiple gets stretched.
   After a solid Q1 earnings report, Habit Restaurants (NASDAQ:HABT) bounced around until it soared 12.5% on Monday. The premium hamburger joint presumably surged due to the McDonald's (NYSE:MCD) turnaround plan falling short of expectations, but one has to wonder if it really justifies a surge in the stock price.

 Read the full article on Seeking Alpha.


 Disclosure: No positions mentioned. Please read the disclaimer page for more details.

Medovex: Riding A Major Investor To Success


Summary

  • Medovex offers a compelling investment opportunity in the medical device sector.
  • The company has the backing of a famed investor in Steve Gorlin that has produced several big gainers.
  • The stock has traded down since a recent IPO suggesting the market isn't aware of the opportunity that exists in this small cap.
  • Medovex faces intense competition so the investment isn't for everybody.
  The medical device space is a complex area to invest riddled with huge success and many failures. The stocks can generate outsized returns or completely fail causing an investor to lose all of their investment. In these situations, it always helps to have the "stamp of approval" from a prominent hedge fund investor or venture capitalists. Even with the backing of a valued investor, it still doesn't ensure success without the devices.

 Read the full article on Seeking Alpha.


 Disclosure: No positions mentioned. Please read the disclaimer page for more details.

Monday, May 4, 2015

Glu Mobile: Will The Rally Last This Time?


Summary

  • Glu Mobile beat Q1'15 expectations.
  • The company continues building on numerous franchises providing more repeatable revenue.
  • Revenue growth in 2015 isn't based on a big hit.
  • Glu Mobile has several upside catalysts including the Tencent deal and a slew of games producing a unexpected hit.
  On the surface, the rally in Glu Mobile (NASDAQ:GLUU) appears eerily similar to last year. Within a short-time period, the mobile-game developer quickly rallied from around the $3.50 range to the $7 range. In reality, the move this time is vastly different and based on more consistent results.


 Read the full article on Seeking Alpha.


 Disclosure: Long GLUU.  Please read the disclaimer page for more details.

Friday, May 1, 2015

American Airlines And Halliburton - Ultimate Pairs Trade To Hedge Out Oil


Summary

  • The volatile price of oil makes investment decisions difficult in this market suggesting that a pairs trade is beneficial.
  • American Airlines Group benefits from lower oil prices while at the same time having catalysts for higher stock prices independent of oil.
  • Halliburton benefits from higher oil prices along with the catalyst of major synergy benefits from the Baker Hughes merger.
   When researching stocks in the current economic climate, one overriding issue continues to pop up. How to handle the volatile price swings of energy prices and specifically oil? Considering that some stocks benefit from lower oil prices and some need oil to rebound, the thought popped up that maybe the best move is to hedge a portfolio with stocks that balance each other out with the impact of oil.


 Read the full article on Seeking Alpha.


 Disclosure: Long AAL, HAL.  Please read the disclaimer page for more details.

MasterCard: Another Quarter Of Limited Growth


Summary

  • MasterCard reported mixed results for Q1 2015.
  • The majority of the earnings beat was based on a substantially lower effective tax rate.
  • The valuation of MasterCard remains stretched for a company with limited operating income growth.
   Investors reading my work know that I'm not bullish on a company with volumes growing around 10%, margins at very high levels that attract competition and valuations suggestive that growth is double the current level. Those are the general numbers that MasterCard (NYSE:MA) offers investors with the last quarter not providing any improvements on that theme.

 Read the full article on Seeking Alpha.


 Disclosure: No positions mentioned. Please read the disclaimer page for more details.

Does Yelp Need Help?


Summary

  • Yelp reported highly disappointing Q1'15 earnings.
  • The company has several catalysts to ramp up user growth and move away from a dependence on traffic from Google.
  • The stock is suddenly worth only $3 billion and trades at very reasonable multiple of future revenue.
With the stock collapsing to new lows, on the surface it definitely appears that Yelp (NYSE:YELP) needs some help. The consumer review site already has a well-defined Google (NASDAQ:GOOG)(NASDAQ:GOOGL) problem that is a major part of the user growth issue, especially internationally. Now the company outlined an internal sales issue and a disappointment with brand advertising adding to the troubles.


Read the full article on Seeking Alpha.



Disclosure: Long YELP. Please review the disclaimer page for more details.