6 Stocks from the Week that Was
Tim is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
With an active and certainly interesting week now behind us, let’s take a look at a few of the opportunities and where they stand now. These either presented themselves or were confirmed as a result of earnings announcements last week.
Here are the re-caps along with links for a more comprehensive breakdown of what made these companies intriguing.
The week ended with a lot of investors, analysts and assorted pundits talking about and acting on the earnings release from Google (NASDAQ: GOOG). Though both quarter-over-quarter and year-over-year revenues and income continued to climb, GOOG dropped like a log; down a shade over 8% for the day. Not meeting analyst expectations cost the company and its shareholders big time, but 8%? Nah, this is a Buy on overselling.
Google’s one-time competitor Yahoo (NASDAQ: YHOO) also had an interesting week, but for entirely different reasons. Jerry Yang, co-founder and well-known stick in the mud, has left the building. Not surprisingly the share price popped as investors thought, “aha, finally we can get our estimated $17 billion from our Asian assets and get moving to fix this thing.” The reality is there are concerns about new CEO Scott Thompson's lack of experience, and he's going to need to prove himself while the whole world is watching. And even with the excitement over re-invigorating talks about the Asian assets, uncertainty reigns. Wait to get in, Hold if it's too late.
Though the taste Google left on investors' palates last week will have a lot of them thinking about the Tech sector, it was the banks that drove the market early on. Wells Fargo (NYSE: WFC) got back to basics announcing solid commercial and residential loan growth among other positive news. And as the bank's $1.5 billion expense cutting program takes hold in '12, this is one of the best in the industry. Buy.
Smaller and with a much different backdrop than Wells was the beating super regional bank Huntington Bancshares (NASDAQ: HBAN) took after announcing earnings growth. Unfortunately, the numbers weren't enough to meet vaunted analyst expectations. The subsequent drop left investors with a great opportunity to get into a stock that was already one of the cheapest in its sector. And with an improving loan portfolio and outstanding year-over-year growth this is a big-time Buy.
Bank of America (NYSE: BAC) pulled a smoke and mirrors routine with their earnings announcement. Initially investors were ecstatic -- B of A was back in the black, baby! Shareholders of the beleaguered behemoth saw a nice gain, thank you very much. But peeling back the layers of BAC's earnings left a less-than-rosy picture. One-time gains, debt restructuring and other accounting moves were what drove the numbers, not core banking activities. Unless you're a day or short-term trader, Bank of America is too volatile and will be until they can show signs of growing core banking lines. Not to mention there are other, better financial services industry options. Wait, unless you're after short-term momentum plays.
Saving the best for last, Intel (NASDAQ: INTC) played their role perfectly this week. Doing what they seemingly always do, the industry leader "surprised," beating earnings estimates and then jumping about 5% for the week. Even with the pop and new 52-week high INTC remains one of the best values on The Street, trading at a paltry 11 times earnings. Add management's projected 12% growth in 2012 -- again the company is notorious for undershooting estimates -- and Intel is a great basis for a strong portfolio. The 3.18% yield isn't too bad either. BUY.
The investment opinions included are just that, opinions. Tim is not a licensed investment professional, nor has he been for several years. Investing involves risk, as you well know, so consider your decisions wisely.