You've seen the headlines. You know your stock price made a big move. But what does that portend for your investment's future?
By pairing the latest news with the collective wisdom of our 180,000-strong Motley Fool CAPS investing community, we might be able to discover whether your stock's latest exploits are a short-term hiccup -- or the start of a much bigger trend.
The following two stocks have both made big moves over the past five trading days, one up, one down:
CAPS Rating(out of 5)
Change Past Week
InterDigital (NAS: IDCC)
YRC Worldwide (NAS: YRCW)
Source: Motley Fool CAPS, % Chg. from Jan. 19 to Jan. 26
72 inches down
It was supposed to be the centerpiece of its ascendancy, but it was realized that the sale of InterDigital's patent portfolio would ultimately not amount to much. The company admitted as much the other day when it said it was taking the portfolio off the market, sending shares lower.
Dollar signs floated before everyone's eyes after bankrupt Nortel got billions for its patent portfolio and Motorola Mobility (NYS: MMI) got billions more from Google. InterDigital (and a few others, like VirnetX Holdings [NYSE: VHC]) quickly had their green-eyeshade types calculating just how much they could realize if the key patents they held could also be monetized.
Unfortunately, after all those monied companies had bought into patents of its rivals, there didn't seem to be anyone with deep enough pockets to buy InterDigital's IP. Of course, it can still operate successfully and profitably as a standalone company; it's just not going to realize a quick influx of cash, and the overreaction by the market represents an opportunity, according to CAPS All-Star dj2000a.
You can put InterDigital on your Watchlist to be alerted if some white knight ends up coming riding to the rescue.
Keep on truckin'
Hey, stranger things have happened. Just look at trucking giant YRC Worldwide, which at one point was a sure candidate for bankruptcy, but has managed to bypass disaster. It's not a healthy trucker yet, but it's no longer on the side of the road with four flats either.
The trucking industry is on the road to recovery, according to the American Trucking Association, as for-hire truck tonnage soared 6.8% in December, well ahead of expectations and November's anemic 0.3% increase. Tonnage was up more than 10% last month. To underscore the improvement, JB Hunt (NAS: JBHT) just reported results that were ahead of analyst expectations as revenues surged 18% in the fourth quarter, generating a 26% increase in operating profits. Con-way and Old Dominion Freight Lines are scheduled to report earnings next week.
YRC is still attempting to restructure itself back to profitability. As the country's third largest less-than-truckload carrier, YRC still needs to negotiate the tricky landscape of Teamster work rules that hamper its ability to fully gain control of the wheel.
They will never achieve positive cash flow because they have too much debt to repay, and when business picks up, so will the cost of fuel. They can't win. They can't raise rates either, because low-cost, often non-union, competitors will steal most of their customers.
Add YRC Worldwide to your Watchlist and let us know in the comments section below if it will find its way to the open road again.
Read all about it!
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At the time thisarticle was published Fool contributorRich Dupreyholds no position in any company mentioned.Click hereto see his holdings and a short bio. The Motley Fool owns shares of Google.Motley Fool newsletter serviceshave recommended buying shares of Google and InterDigital. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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