A humorous look at the companies that caught our eye, for better or worse, this week
Research In Motion
Things you don’t see very often:
1) Solar eclipses;
2) Toronto Blue Jays victories;
3) RIM being named a “star” in Stars and Dogs.
Left for dead by many investors, the BlackBerry maker was discovered to have a pulse this week when second-quarter results came in above expectations and the number of subscribers grew to 80 million from 78 million, driven by overseas markets. Now all RIM needs is for BlackBerry 10 to be a hit. Piece of cake.
Groupon drives down prices for spa visits, restaurant meals and other products and services. But driving down its own stock price may be Groupon’s true calling. The shares plunged after a Raymond James survey found that more than half of merchants lost money or broke even on their Groupon promotions and one-third were either “unsatisfied” or “very unsatisfied” with the experience. Apparently, 100 per cent of investors are “very, very unsatisfied” with the stock.
In the old days, if you wanted to wish someone a happy birthday, you mailed them a card. Now, you program your smartphone’s birthday app. With technology replacing paper cards, American Greetings’ stock has dropped 40 per cent in the past five years, but it got a lift when a group led by CEO Zev Weiss and his brother, COO Jeffrey Weiss, offered to take the company private for $17.18 a share. No word on whether the offer also came with a stupid poem.
Investing quiz! When a stock’s dividend yield reaches 9.6 per cent, it means:
a) The stock is twice as good as one yielding 4.8 per cent;
b) You should take out a line of credit on your home and buy, buy, buy;
c) Proceed with extreme caution.
Answer: c. AGF disclosed that investors pulled $2.4-billion in assets from the beleaguered company in the third quarter and said it expects another $1.5-billion in net institutional redemptions in the fourth, prompting analysts to slash their ratings and price targets.
With Facebook down 43 per cent from its IPO price, you’d think the stock would have hit bottom by now, right? Not even close, according to an article in Barron’s that sent the shares reeling this week. The financial magazine questioned Facebook’s ability to make money from mobile advertising without annoying users, and pegged the value of the social media site at just $15 a share, which would still be a rich 24 times estimated 2013 earnings. Investors are de-friending the stock in droves.