Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) closed at $25.10 last Friday, marking a 47.6% drop for the week. The stock dramatically fell by 48% last Thursday, after Wall Street expressed its loss of confidence when the company cut its outlook and missed sales estimates again. This was the company’s lowest point in about two years, compared to a lifetime high of $115.98 only last September. Its earnings announcement last week gave credence to critics who alleged that the company had been inflating sales and that its high-growth figures were no longer sustainable.
Stock Market News
Though Facebook's IPO date has not been made official, analysts and journalists have been saying that the social media giant is aiming for an IPO sometime in May. However, recent events, such as Facebook’s billion-dollar Instagram acquisition or its $550 million patent deal with Microsoft, might have pushed the IPO to June instead, as the company now needs to make more financial disclosures.
Networking gear manufacturer Cisco Systems, Inc. (NASDAQ:CSCO), which is reporting its third quarter earnings after the market close on Wednesday (9 May), closed at $19.42 last Friday, marking a 3% drop for the week. The stock has generally been on the decline since peaking at $21.19 in early April. Cisco, which is currently up 4.7% for the year, has a 52-week low of $13.30 and a 52-week high of $21.30.
Starbucks Corp. (NASDAQ:SBUX) fell 5.3% last Friday to close at $57.43, after the announcement of its second-quarter financial performance. The stock, which has been on an upward trajectory, is currently up 23.6% this year.
While Starbucks increased its net income by 18%, its sales figures showed weakness in parts of Europe. Earnings for the second quarter reached $309.9 million or 40 cents per share, compared to $261.6 million or 34 cents per share a year ago. Revenue rose to $3.2 billion, up from $2.79 billion a year ago.
Online social games provider Zynga Inc. (NASDAQ:ZNGA) fell by 9.5% last Friday to close at $8.52. This also marked a 0.9% drop for the week. Zynga has been on a price decline since peaking at $14.69 in early March. (The stock is currently down 9% for the year.) Zynga’s dismal stock performance came even after it reported better-than-expected first quarter results last week.
Tech giant Apple (NASDAQ:AAPL) rose above the $600 level last week, closing at $603 on Friday. This was also the company’s best stock performance over the past six weeks. Nonetheless, while last week’s performance represented a 5.2% gain, the stock is still away from the $644 peak achieved in early April. Nonetheless, after announcing a much better than expected second-quarter performance that was primarily boosted by strong iPhone sales, Apple shares soared by 9% last Wednesday. This was also Apple’s biggest one-day gain since November 2008.
I did this podcast with Reggie Middleton of www.boombustblog.com.
Reggie is a private individual investor who made a fortune in real estate and the financial markets and hired a team of analysts to work for him. He uses that research to discover more profit opportunities and shares it with high net worth clients and institutional investors at his website www.boombustblog.com.
Last Friday, Apple (NASDAQ:AAPL) closed at $605.23, continuing a downward trend for the week. The stock fell by 4.5% in the course of last week. After peaking around $643 in early April, Apple has been falling ever since. While the stock is up 49.4% for the year, some are now wondering if Apple has peaked for now. The impression was further reinforced when Apple fell again on Monday this week by 4.15%, marking five consecutive days of decline.
Last Friday, eBay closed at $36.12, marking a 1.4% gain for the week. The auction giant will be reporting its first quarter earnings this coming Wednesday (18 April). Over the past month, eBay has traded around $35.41 - $38.08. The stock is currently up 19% for the year.
Tech giant IBM (NYSE:IBM) will be reporting its first quarter earnings after the market closes this Tuesday (17 April). This will also be the first quarter under the management of its new CEO Ginny Rometty. Last Friday, IBM closed at $202.80, marking a 1.3% drop for the week. Over the past month, IBM traded around $202 - $210. (The stock is currently up 8.9% for the year.)
Semiconductor chip maker Intel (NASDAQ:INTC) will be reporting its first quarter earnings after the market closes this Tuesday (17 April). Last Friday, Intel closed at $28.09, marking a somewhat flat performance for the week. Over the past month, Intel traded around $27.45 - $28.50. (The stock is currently up 14.4% for the year.)
Yesterday we saw a healthy rebound in the stock market as the DOW rallied over eighty points following a steep drop Tuesday, which looked like a classic textbook selling washout. We actually saw the stock market pullback every day this month until it finally turned around yesterday.
Last month, Velocity Shares Daily 2x VIX Short Term ETN (NYSEARCA:TVIX) fell 61% over the course of three days from 22 to 26 March. Though the stock has somewhat recovered from its bottom of $5.90, it is currently only trading at $7.04, a far cry from $17 in early March and over $30 at the start of the year. (TVIX is currently down 77% for the year.)
The Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) are now looking into the matter. Credit Suisse, which manages TVIX, said that it was cooperating with the authorities.
Last week, Research in Motion Limited (NASDAQ:RIMM) traded between $13.50 and $14.10, until Friday, when it rallied by 7.5% to close at $14.70. This followed the comments by new CEO Thorsten Heins (who took over at the beginning of the year) in response to the disappointing fourth-quarter performance announced on Thursday.
Last Friday, chip maker Intel (NASDAQ:INTC) closed at $28.11, marking a 0.86% gain for the week. Intel, which has been on an upwards trajectory since the start of the year, is currently up 14.5% for 2012. On 22 March, the company announced a 21 cents per share (84 cents per share on an annual basis) quarterly dividend on its common stock.
Last Friday, Cisco Systems, Inc. (NASDAQ:CSCO) closed at $21.15, marking a 3% rise for the week. Since early March, the stock has been on an upward trajectory, registering an 8.6% climb in the preceding weeks. Cisco is currently up 15.9% for the year. The network equipment maker, which has been trying to boost growth after market-share losses to rivals, is currently on an aggressive technology acquisition. Moreover, CEO John Chambers is looking to add more profitable products as part of a turnaround plan undertaken last year, when he cut jobs and eliminated businesses.
Bank of America (NYSE:BAC) closed at $9.57 last Friday, marking a 2.84% drop for the week. After making dramatic increases in January and early March, the bank has been trading in the $9.50 - $10.00 region since mid-March. BAC is currently up 75% for the year, which is largely attributed to increased investor confidence about its balance sheet. CEO Brian Moynihan has been shedding assets and businesses that are deemed non-essential to the company, such as its Canadian credit card business and a stake in China Construction Bank.
US economic data this week was mostly positive and, though international data painted a more sanguine view, helped push US markets to close the week higher. Once more, the Nasdaq starred, with Apple (NASDAQ: AAPL) pushing strongly through the $600 mark before closing slightly below on Friday. The Nasdaq has improved by 21% this quarter, whilst the Dow Jones has added 7% and the broader S&P 500 12%.
Last Friday, global biopharmaceutical company Bristol Myers Squibb Co. (NYSE:BMY) closed at $32.96, marking a 0.18% gain for the week. The stock is currently 6.6% down for the year. Starting off at $35 in January, it experienced a big drop in the succeeding two months, bottoming out at $31.85 in mid-February, before making moderate gains in recent weeks.
KB Home (NYSE:KBH) fell 8.45% to close at $10.29 last Friday. This also marked a 19.4% drop for the week. Nonetheless, the stock is actually still up 53% for the year, having peaked at $13.06 in mid-March, after which it began to fall to the current price. Last week’s dramatic price drop was the result of disappointing first-quarter results. For the quarter ended 29 February, KB Home reported a loss of $45.8 million, or 59 cents a share, compared with a year-earlier loss of $114.5 million, or $1.49 a share.
Window dressing refers to a strategy adopted by some mutual fund and portfolio managers to improve their fund performance, usually near the year or quarter end, before presenting it to clients or shareholders. This could be done in several ways. Firstly, the fund manager could sell stocks with large losses and purchase high-flying stocks before the quarter end. For example, stocks such as Nvidia, KLA-Tencor, Micron, Tesoro and Netflix (that are up more than 20% year-to-date) would probably face upward pressure in the coming days.
News Corporation (NASDAQ:NWSA) closed at $19.79 last Friday, marking a 0.35% gain for the week. Notwithstanding its ongoing legal troubles, News Corp has been trading around $18.6 - $20.29 for the past three months. Since the outbreak of the phone hacking scandal last year, the stock has bottomed out at $13.62 in August 2011, before recovering ever since. The stock is now up 10.7% for the year.
Last Friday, telecommunications giant AT&T (NYSE:T) closed at $31.52, marking a 0.6% loss for the week. Earlier in the week, the stock has been on the rise, peaking at $31.96 on Wednesday, before easing for the rest of the week. AT&T, which is currently up 7.6% for the year, has been on an upward trajectory in recent weeks, since bottoming out at $29.16 in late January.
Apple Inc. (NASDAQ:AAPL) continued its impressive stock performance last week, at one point breaching the $600 mark. (The stock peaked at $609.58 on Wednesday.) On Friday, Apple eased at $596.05, marking a 0.55% drop for the week. In fact, the stock has been on an upward trajectory since early 2009, and has been making excellent monthly gains since last December. (The stock is up 47% for the year.) Apple is also currently the largest company by market capitalization.