FedEx (FDX) recently announced its FedEx Express business unit would increase shipping rates 3.5% starting next year for cargo. In addition, FedEx indicated it would increase rates for ground shipments next year. The stock price of FedEx’s rival United Parcel Service (UPS) plunged 17% in July/August of this year after reporting mediocre earnings and a poor outlook for the coming year. UPS’s stock price has since recovered somewhat since the July/August drop but UPS’s stock price is still down 10% from its top.
Month: November 2006
Hewlett Packard (HPQ) – Dell (DELL) – PC Market Share
Hewlett-Packard (HPQ) has become number one in PC sales. HP’s rival Dell (DELL) gave up their number one position in the third quarter of this year as their sales numbers began to slump. In recent years Dell has had to slash their PC prices, and ultimately their profit margin, to increase sales and many analysts believe this has hurt their bottom line.
Sewing Up Profits – Covered Call Investing
For many years, make-it-yourself-sewing retail businesses have not been very popular on Wall Street, as the idea of stay-at-home-mom’s making clothes for her children was considered faux pas. Working moms would tender the argument, “why spend several hours making a garment when it can be purchased fairly inexpensively at the mall?” But recently, hand made clothing has seen a resurgence of interest by younger generations. It is becoming more fashionable to wear something hand-made. So young daughters are now asking for sewing machines for Christmas and using the machinery to make their own custom clothing.
Magic Returns to the Disney (DIS) Kingdom
Mickey and Minnie mouse may be able to afford a house in the Hamptons this year. Walt Disney (DIS) announced yesterday its fourth quarter profits nearly doubled with a revenue growth of 14%. The earnings are thought to be in large part due to the overwhelming success of “Pirates of the Caribbean: Dead Man’s Chest.” Also Disney’s cable networks continue to return strong earnings.
Democrats May Provide Relief to Detroit
Some analysts are predicting Ford Motor Company (F), Chrysler (DCX) and General Motors (GM) may turn out to be big winners as a result of the Democrats newly acquired power in the House of Representatives. Particularly, it is because Rep. John Dingell is the most likely candidate to become the chairman of the House Energy and Commerce Committee ( reuters.com ).
Adobe (ADBE) Systems Open-Source Flash
In what many analysts are describing as a surprising move, Adobe Systems (ADBE) is giving away the source code to its popular flash player. This move is akin to Microsoft (MSFT) giving away its Windows’ source code to allow software developers the ability to create applications for the Windows platform. The opposite of this was Apple’s (AAPL) decision to keep its operating systems source code a secret.
Giving Credit to the Japanese
Historically, Japanese consumers have preferred to pay for purchases using cash, believing that going to into debt was to be avoided at all cost. This has long frustrated credit card companies and banks wishing to enter the Japanese consumer debt market. Americans may not be exporting much else, but American-style consumerism seems to be taking root in Japan.
Microsoft (MSFT) – Novell (NOVL) – Red Hat (RHAT) Triangle
On Friday Microsoft (MSFT) reached a deal with the Novell Corp. (NOVL) that makes it easier for consumers to use both Microsoft and Linux products. This puts pressure on Red Hat Inc. (RHAT), a company selling Linux related products, and whose shares fell recently after Oracle Inc. (ORCL) announced they would be providing technical support for Linux.
Bearish on CVS – Caremark (CMX) Merger
The share prices of drugstore chains and pharmacy-benefits managers have been steadily declining since Wal-Mart announced that it planned to cut the price on some of its generic drugs to $4 for a 30-day supply.
Garmin (GRMN) – GPS – Covered Calls
In 1651 John Milton composed a sonnet regarding his blindness and talent. In it, he pondered the cruelty of his blindness robbing him of the ability to pursue his writing talent. We all have a thing, which we’re best at. An economist would argue that we ought to spend our lives working at our most productive vocation.