Second-quarter earnings season was a bit of a bust. Although earnings remain at an all-time high, the pace of earnings growth continues to look weak. Earnings growth is up just 3% from last year, a small improvement from the first quarter's 2.6% gain and the 2.8% average for the past four quarters.
The headlines reflected that disappointment, with stories about the biggest blue chips struggling with the weak global economy and falling short of expectations. That includes misses from bellwethers like IBM (NYSE: IBM), Google (Nasdaq: GOOG) and Microsoft (Nasdaq: MSFT).
But in spite of some earnings headwinds, there were a number of companies that bucked the trend and delivered big earnings surprises. For instance, take Facebook (Nasdaq: FB), which delivered a 44% earnings surprise last month that sent the company's share price soaring.
Hot Performing Companies For 2016: Visa Inc.(V)
Visa Inc., a payments technology company, engages in the operation of retail electronic payments network worldwide. It facilitates commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses, and government entities. The company owns and operates VisaNet, a global processing platform that provides transaction processing services. It also offers a range of payments platforms, which enable credit, charge, deferred debit, debit, and prepaid payments, as well as cash access for consumers, businesses, and government entities. The company provides its payment platforms under the Visa, Visa Electron, PLUS, and Interlink brand names. In addition, it offers value-added services, including risk management, issuer processing, loyalty, dispute management, value-added information, and CyberSource-branded services. The company is headquartered in San Francisco, California.
Advisors' Opinion:- [By Philip Springer]
Just last week, the major US stock averages hit all-time highs, led by large-cap stocks, including some that had been lagging for many years. But it’s been a different story in March-April for stocks that had the biggest gains of 2013 and early this year.
This week brought more bad news for the stock market’s two most overvalued sectors, biotechnology and information technology. Worse, when the paddy wagon came, as usual it took the good stocks with the bad, to rephrase an old Wall St. aphorism in politically correct terms.
Yesterday, the technology-heavy Nasdaq Composite Index tumbled 3.1 percent, its �biggest one-day drop in nearly 2陆 years. This dragged the broader market sharply lower, as investors resumed selling biotechnology stocks in general and many technology stocks. As of April 10, the Nasdaq Composite was 7 percent off its 14-year high, which was reached last month. Yet the S&P 500 and Dow Jones Industrial Average remain not far from their all-time record peaks, down 3 percent and 2.5 percent respectively.
There are many reasons for the decline of both the junk and the good growth stocks. First, the broad market has been long overdue for a 10 percent correction, which still hasn’t occurred.
Second, the high fliers were much more overdue for a reality check. These particularly include extremely overvalued companies in social media, the “cloud,” 3d printing, biotechnology and more.
Third, the new-issues market, which naturally has consisted primarily of info tech and biotech issues, created too much new supply that inevitably dampened investor demand for the more established companies in those sectors.
The increased importance of trading exchange-traded funds, as both a way to invest and to hedge against market declines, inevitably adds to the downward pressure in this situation.� Reason: Shares of all of their components are sold, regardless of each stock’s relative me - [By Paul Ausick]
Visa Inc. (NYSE: V) slipped 2.41% for the day, likely on the coattails of an earnings miss by rival MasterCard In. (NYSE: MA). Consumer finance stocks were near the top of today�� sector losers. Shares closed at $215.56 in a 52-week range of $154.14 to $235.50. Volume was about 70% above the daily average of around 3 million shares.
- [By Anora Mahmudova]
American Express Co. (AXP) �shares gained 3.6% after the credit card company said its fourth-quarter earnings more than doubled. Shares in rival Visa Inc. (V) � rose 4.7%
- [By Ben Levisohn]
Leave to MasterCard (MA) to undo all the good work Visa (V) did yesterday.
ASSOCIATED PRESSShares of MasterCard dropped 5% to $75.68 today after reporting earnings that missed analyst forecasts. Its miss also dragged down Visa, which fell 2.5% to $215.43, American Express (AXP), which declined 1.9% to $85.02 and Discover Financial Services (DFS), which closed down 2.1% at $53.65.
Top 5 Blue Chip Stocks To Watch Right Now: Philip Morris International Inc(PM)
Philip Morris International Inc., through its subsidiaries, engages in the manufacture and sale of cigarettes and other tobacco products in markets outside of the United States. Its international product brand line comprises Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. The company also offers its products under the A Mild, Dji Sam Soe, and A Hijau in Indonesia; Diana in Italy; Optima and Apollo-Soyuz in the Russian Federation; Morven Gold in Pakistan; Boston in Colombia; Belmont, Canadian Classics, and Number 7 in Canada; Best and Classic in Serbia; f6 in Germany; Delicados in Mexico; Assos in Greece; and Petra in the Czech Republic and Slovakia. It operates primarily in the European Union, Eastern Europe, the Middle East, Africa, Asia, Canada, and Latin America. The company is based in New York, New York.
Advisors' Opinion:- [By Chuck Carnevale]
But it was with the last couple of sentences of his blog post that I took the greatest exception. More precisely, I found that his example of Phillip Morris International (PM) to be misleading. However, not because of what Roger included, but rather because of what he left out. I will elaborate more right after the following excerpt where he closed out his blog post:
- [By Laura Brodbeck]
Thursday
Earnings Expected From: Credit Suisse Group (NYSE: CS), Expedia Inc. (NASDAQ: EXPE), Kellogg Company (NYSE: K), LinkedIn Corporation (NYSE: LNKD), Philip Morris International Inc. (NYSE: PM) Economic Releases Expected: French trade balance, British trade balance, eurozone consumer confidence, German industrial production, Bank of England interest rate decision, European Central Bank interest rate decision, US initial and continuing jobless claims, Chinese trade balanceFriday
- [By Ben Levisohn]
Shares of Lorillard have jumped 4.6% to $51.29 at 1:32 p.m. today, while Reynolds American has gained 2.5% to $52.12 and British American Tobacco has dropped 1.1% to $107.62. Altria Group (MO), meanwhile, has risen 0.4% to $36.43 and Philip Morris International (PM) has declined 0.9% to $80.21.
Top 5 Blue Chip Stocks To Watch Right Now: McDonald's Corporation(MCD)
McDonald?s Corporation, together with its subsidiaries, operates as a worldwide foodservice retailer. It franchises and operates McDonald?s restaurants that offer various food items, soft drinks, coffee, and other beverages. As of December 31, 2009, the company operated 32,478 restaurants in 117 countries, of which 26,216 were operated by franchisees; and 6,262 were operated by the company. McDonald?s Corporation was founded in 1948 and is based in Oak Brook, Illinois.
Advisors' Opinion:- [By Reuters]
Ricardo Ricote Rodríguez/Flickr World's biggest fast-food chain seeks new ketchup for its famous french fries. McDonald's Corp (MCD) on Friday said it plans to end its 40-year relationship with ketchup maker H.J. Heinz Co, since that company is now led by Bernardo Hees, the former chief executive of hamburger rival Burger King Worldwide Inc. "As a result of recent management changes at Heinz, we have decided to transition our business to other suppliers over time," McDonald's said in a statement. "We have spoken to Heinz and plan to work together to ensure a smooth and orderly transition," said McDonald's, which has more than 34,000 restaurants around the globe. Heinz declined to comment. "As a matter of policy, Heinz does not comment on relationships with customers," company spokesman Michael Mullen said. The switch will be more apparent overseas than in the United States, as McDonald's only serves Heinz ketchup in two domestic markets - Pittsburgh and Minneapolis, the Pittsburgh Post-Gazette reported on Friday. Indeed, ketchup packages handed out at McDonald's restaurants in the United States often say only "fancy ketchup." Most in-store ketchup dispensers are not branded. The move from McDonald's could benefit Heinz ketchup rivals Hunt's, owned by ConAgra Foods Inc, and Del Monte. Warren Buffett's Berkshire Hathaway and an investment fund affiliated with 3G Capital bought Heinz for $28 billion in June and immediately named Hees CEO. Burger King went public in June 2012, less than two years after it was taken private by 3G Capital Management LLC, which retains a stake in the fast-food chain.
- [By Mark Morelli]
Large companies like Wal-Mart Stores� (NYSE: WMT ) , McDonalds (NYSE: MCD ) , and Home Depot (NYSE: HD ) could profit from the excess cash that oil-field workers and their families can afford to spend.�
Top 5 Blue Chip Stocks To Watch Right Now: Chevron Corporation(CVX)
Chevron Corporation, through its subsidiaries, engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. It operates in two segments, Upstream and Downstream. The Upstream segment involves in the exploration, development, and production of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines; and transportation, storage, and marketing of natural gas, as well as holds interest in a gas-to-liquids project. The Downstream segment engages in the refining of crude oil into petroleum products; marketing of crude oil and refined products primarily under the Chevron, Texaco, and Caltex brand names; transportation of crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacture and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It a lso produces and markets coal and molybdenum; and holds interests in 13 power assets with a total operating capacity of approximately 3,100 megawatts, as well as involves in cash management and debt financing activities, insurance operations, real estate activities, energy services, and alternative fuels and technology business. Chevron Corporation has a joint venture agreement with China National Petroleum Corporation. The company was formerly known as ChevronTexaco Corp. and changed its name to Chevron Corporation in May 2005. Chevron Corporation was founded in 1879 and is based in San Ramon, California.
Advisors' Opinion:- [By Dan Caplinger]
3 stocks to consider
Chevron (NYSE: CVX ) has a 26-year history of raising its dividends every year, with a current yield of 3.4%. Big oil stocks have faced the challenge of finding ways to replace lost production volume from older wells suffering natural declines in output, but Chevron has done a better job than many of its rivals in replacing that lost production with new asset purchases in promising areas around the world. Despite an already attractive yield from a dividend that the company increased by 11% in May, a payout ratio of 27% shows that Chevron could easily keep boosting its dividend in the years to come. PepsiCo (NYSE: PEP ) has used its global snack and beverage business to produce consistent cash flow and profits over the long run, giving back much of its earnings in the form of dividends. Its 2.8% yield comes after 41 consecutive years with payout boosts. With a payout ratio of 55%, Pepsi needs to keep growing in order to support further dividend increases, but even as soft drink makers in the U.S. have to deal with rising concerns about obesity, Pepsi has taken the lead with a forward-looking emphasis on healthier offerings that should serve it well throughout the world. Consumer-products maker Kimberly-Clark (NYSE: KMB ) sports the highest payout ratio in this group at 66%, but its 3.4% yield and 41 straight years of rising dividends make it a logical stock to invest in for dividend investors. The company has done a good job of taking advantage of missteps from rivals in the industry, with an emphasis on growth in emerging markets like Latin America. As rising consumer middle classes in emerging nations demand more of the conveniences that people in developed countries take for granted, Kimberly-Clark is positioning itself to
For a good mix of positive dividend attributes, the following stocks offer a compelling combination of low payout ratios, long dividend histories, and attractive yields: - [By Sara Murphy]
Joe also discusses particular risks to offshore oil rigs in the Gulf of Mexico. BP (NYSE: BP ) will have six rigs under firm contract there by December 2014, more than any other operator. Shell (NYSE: RDS-A ) will come in second with five rigs. Anadarko Petroleum (NYSE: APC ) is expected to have four operating rigs by then, followed by Chevron (NYSE: CVX ) with three under firm contract and ExxonMobil (NYSE: XOM ) (NYSE: XOM ) with two. Watch the following video to learn how climate change could affect these companies.
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