"Under Armour (NYSE: UA) and VMware (NYSE: VMW) both have the potential for a short squeeze in coming months," says Paul Tracy in StreetAuthority Market Advisor.

"VMware is a market leader in software virtualization. Companies typically do not use the full computing power of their servers, and when not in use, that server sits idle.

"Virtualization technology allows IT managers to use that underutilized capacity -- running software across the organization's entire base of servers. Thus, virtualization is a key cost-cutting technology.

"VMware has a short interest ratio of 11.7 and a freely traded float of just 50 million shares. If all those shorts try to cover, the stock looks likely to be in short supply. Meanwhile, trading at 36 times 2009 earnings estimates with a long-term growth rate of 45%, VMW doesn't look overpriced.

"Under Armour (NYSE: UA) makes clothing (along with sports equipment) targeting the athletic and outdoor-oriented market. Specifically, the company makes clothes designed to wick moisture away from the skin and keep the wearer at a comfortable temperature, regardless of weather conditions.

"Meanwhile, the stock has seen strong earnings growth despite the slowdown in consumer spending -- earnings surged 42% in the fourth quarter. And management recently announced its looking for revenues to reach $765-775 million in 2008, representing around a 27% increase over 2007 levels.

"With a forward P/E of 23 and a long-term growth rate of 25%, UA looks inexpensive. With a float of less than 32 million shares and a short interest ratio approaching 12, Under Armour looks like a prime short-squeeze candidate."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

Under Armour (UA) and VMware (VMW): Short squeeze candidates? originally appeared on BloggingStocks on Fri, 04 Apr 2008 12:48:00 EST. Please see our terms for use of feeds.

Today Google Inc. (NASDAQ: GOOG) is the top Internet search and advertising property there is -- No Question! Yesterday it was something else. Why do investors believe that everything now ends with Google? Have we already reached the end of the internet revolution. Maybe we just think Google has locked up the next stages as well.

Yahoo Inc. (NASDAQ: YHOO) started with two graduate students from Standford University and was all the rage. Google started with two graduate students from Stanford University and now it is all the rage. Do we think Stanford is running out of bright graduate students all of a sudden? I would call them and make an inquiry but surely they would not take me seriously.

Has Google perfected Internet advertising? I don't think so, do you? Will Yahoo, Microsoft Inc. (NASDAQ: MSFT), eBay (NASDAQ: EBAY), News Corp (NYSE: NWS) and all the international players concede an inch of ground more than temporarily?

I am not saying that Google won't eventually conquer the Internet world, (because I do not know) but this feat is by no means as certain as the market currently seems to believe: driving the price of GOOG up $95 per share as I write this story, on no news, in about eight weeks.

Continue reading Serious Money: Google (GOOG) has no moat -- beware of false prophets

Serious Money: Google (GOOG) has no moat -- beware of false prophets originally appeared on BloggingStocks on Tue, 02 Oct 2007 15:40:00 EST. Please see our terms for use of feeds.

Jim Cramer says Google Inc. (NASDAQ: GOOG) has stayed put for long enough and is ready to run.

He thinks Google is headed to $600 on a conservative basis, but he did note several valuation comparisons that could take it to $700, $900, and even more than $1,000, because Google is now the cheapest of all internet stocks and the metrics make this the case.

Amazon.com (NASDAQ: AMZN) has soared almost 80% this year with a much richer valuation than Google, a situation the market is bound to correct, according to the Mad Money host.

I would normally think that Jimbo's gone over the edge, because Google does have a $147 billion market cap and Amazon has a $28 billion market cap. I am not sure he hasn't gone nuts, but that's another discussion. These two might not be as comparable (or contrasting) as he thinks because of the huge difference in their sizes.

Google closed up marginally at $474.33, but traded up close to 1% at $477.75 in after-hours trading.

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Cramer calls for $1,000 on Google, well $600.00 anyway originally appeared on BloggingStocks on Thu, 24 May 2007 19:05:00 EST. Please see our terms for use of feeds.

Charles Payne, chief analyst for Wall Street Strategies, is well known from his weekly appearances on FOX TV's Bulls & Bears as well as Cashin' In, Cavuto, and FOX and Friends. And despite the sharp sell off yesterday, he remains cautiously optimistic.

He explains, "Getting investors to see the silver lining of any corrective action borders on being a Herculean task. The strange thing is that so many folks have been waiting on the sideline for the market to pull back."

Yet, he notes, when these correction do happen, investors often fail to take advantage of the lower prices. He adds, "The flip side of the nervous investors are those brave souls who want to run into a burning building." So how should an investor respond to the sharp decline?

Continue reading Payne picks eBay while the dust setttles

Payne picks eBay while the dust setttles originally appeared on BloggingStocks on Wed, 28 Feb 2007 16:30:00 EST. Please see our terms for use of feeds.

Google Inc. (NASDAQ:GOOG) posted awesome fourth-quarter results yesterday. Wall Street, though, was expecting even them to be even more awesome. Shares of the no. 1 search engine fell after the results were posted and are still down in pre-market trading this morning.

Why aren't investors happy with the results? Net income was $1.03 billion, or $3.29 per share compared with $372.2 million, or $1.22, a year earlier. Revenue was $3.2 billion versus $1.9 billion. These blew the doors off Wall Street expectations.

Still, some can pick apart the numbers.

Even when costs and benefits associated with stock-based compensation are stripped out, the profit would have been $3.18, which still easily beats the Wall Street consensus forecast of $2.92, according to the Associated Press. Analyst Rob Sanderson of American Technology Research told the wire service that were it not for an unusually low tax rate of 24 percent compared with the average of 26 percent, earnings would have been $2.99.

Basically, the quarter wasn't a big enough blowout. What did people expect? Google has repeatedly said that it was going to be putting money into the business. It repeated that point during the earnings conference call. Plus, as I pointed out previously, Google's growth is slowing.

Also check out some other earnings reports that we're following, and let us know what you're expecting.

Continue reading Google wasn't awesome enough

Google wasn't awesome enough originally appeared on BloggingStocks on Thu, 01 Feb 2007 08:20:00 EST. Please see our terms for use of feeds.

In late December, Avista Capital Partners agreed to pay $530 million for the Star Tribune, less than half of what McClatchy paid for it in 1998. The deal comes amid growing concerns about the future of newspapers, which are facing competition from the Internet. But in spite of the ugly long-term outlook for newspapers, they may make an interesting investment for now.

For starters, Avista is purchasing the newspaper for 6.5 times its cash flow. Newspapers don't have the large capital expenditure requirements that many more booming businesses do. The industry is in decline, but it's still making money. I'm reminded of a profound statistic that I first read about in Jeremy Siegel's book The Future for Investors: Since 1957, railroad stocks have outperformed airlines, trucking, and the S&P 500.

This is of course not attributable to dramatic growth in the railroad industry. Rather, most investors saw that the companies were in decline and the share prices were driven down, and then provided a good return. The moral of the story: valuation matters. Most stocks are a good deal at the right price.

Are newspapers the new railroads? There are numerous similarities. Railroads were replaced by airplanes and trucks, but the railroad stocks were the better investment. Newspapers are being replaced by the Internet, but that in no way means that Internet stocks are better buys. Here's a quick look at some of the bigger newspaper stocks:

• Gannett (NYSE:GCI): Owner of 91 daily newspapers, including USA Today. The also own around 1,000 non-daily publications. Trades at around 11 times cash flow.
• E.W. Scripps (NYSE:SSP): Owns some newspapers, but also television stations, including HGTV and the Food Network. Also owns Shopzilla.
• Tribune (NYSE:TRB): Trades at around 8 time cash flow. Owns 11 daily newspapers, the Chicago Cubs, television stations, and other media interests.
  
  

Are newspapers the new railroads? originally appeared on BloggingStocks on Sun, 07 Jan 2007 12:10:00 EST. Please see our terms for use of feeds.