Market Wrap-Up for Aug.4 (JNJ, KO, BKS, PCLN, RL, AGU, APC, more)

By
A A A
Share |

I'm not sure if anyone is noticing the pop in Priceline's ( PCLN ) stock this morning, up $50 following the company's earnings beat.

Priceline does not pay a dividend at this time, but I wanted to focus on the manic way investors tend to look at momentum stocks and why long-term investors need to keep exposure to these plays at a smaller part of one's portfolio, if there is an aversion to taking on higher risk. The last time Priceline reported their results the stock ended up getting clocked by $30, taking the stock down below $200 a share. All of a sudden the company gets it all right this quarter and we see it up $50. Unless you possess a trader's edge and discipline to move in and out of stocks like this in a timely manner, there is little reason to stake your long-term dollars on stocks momentum traders bring loads of volatility to. Now, we will on occasion have a situation with a dividend stock, where things could blow up of course, but for the most part, traders are not playing the earnings game with the Johnson & Johnsons ( JNJ ) and Coca-Colas ( KO ) of the world.

Speaking of long-term dollars, there is a lot of chatter about Americans beginning to maybe save too much these days. Ignore all that nonsensical noise you hear and continue to put some of your hard-earned dollars away for your retirement. Don't end up like many who are set to rely on just one source of retirement income, which for a good majority will be Social Security.

Getting back to today's market, Barnes & Noble ( BKS ) popped on news the company is exploring a sale. The stock recently approached all-time lows as the company misplayed an opportunity years ago to acquire Amazon.com ( AMZN ). Don't be tempted by BKS' nearly 8% dividend yield - that payout is certainly not sustainable, and we expect a dividend cut in the near future. The market clearly sees little upside for the book retailing market, thus the long-term fall in shares. Look no further than Blockbuster ignoring the changing market, allowing Netflix ( NFLX ) to come in and basically put the company in the huge bind they are in today. Elsewhere, shares of Polo Ralph Lauren ( RL ) , Agrium ( AGU ) , and Anadarko Petroleum ( APC ) rallied following those companies' reports. Pitney Bowes ( PBI ) went the other way after the company missed earnings estimates and guided lower. Despite another up day today, volume can not seem to break out and it remains a real mystery.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Created by Dividend.com


This article appears in: Investing , Stocks


Dividend.com

Dividend.com

More from Dividend.com:

Related Videos

Stocks

Referenced

Most Active by Volume

91,252,153
  • $13.78 ▼ 4.31%
68,133,496
  • $12.93 ▲ 6.77%
57,268,074
  • $46.13 ▲ 2.47%
43,432,023
  • $105.22 ▲ 0.37%
40,880,685
  • $13.46 ▲ 8.90%
40,712,405
  • $98.62 ▲ 0.82%
39,776,976
  • $16.72 ▲ 0.72%
34,688,871
  • $11.16 ▲ 3.05%
As of 10/24/2014, 04:15 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com