This Week's 5 Smartest Stock Moves
If you're feeling good about the market, you're not alone. Take my hand as we go over some of this week's more uplifting headlines.
It was that good.
The retailer of hardwood flooring delivered a 20% surge in net sales, spearheaded by a 12.4% pop in same-store sales.
What's that? You didn't think people would be interested in updating their flooring for stylish hardwood planks? Think again. Housing prices are starting to stabilize, giving homeowners that are current on their mortgages some degree of comfort in knowing that their home values won't take their bank loans underwater.
The good news gets even better on the way to Lumber Liquidators' bottom line as profitability more than doubled to $0.43 a share. Analysts were only banking on net income of $0.29 a share.
A sticking point that would decide whether the bids would line up in the mid-$30s or the high $30s was apparently the company's quarterly report on Wednesday. Any sign of weakness at the leading genealogy website, and bidders might either drop out or lower their final bids.
Well, Ancestry.com proved that it wasn't the black sheep in the family. The website operator delivered better than expected top- and bottom-line results. Ancestry.com also posted a healthy pop in subscriptions and a welcome decline in monthly churn.
3. Born on the Baidu
There's still growth to be found in China.
Revenue climbed 60% to $850.0 million in its latest quarter, and the midpoint of its guidance for the current quarter would make this the company's first $1 billion quarter.
Profitability soared 70% to $436 million -- or $1.24 a share -- but the reversal of a tax provision helped pad the bottom-line performance. Operating income actually only rose by 52% during the period.
Then again, that's still some pretty high octane for a stock selling a forward earnings multiple in the teens. Baidu remains the undisputed search engine leader in China, and with the average advertiser spending 35% more through Baidu to reach customers than a year earlier, there's little reason to believe that Baidu's popularity will fade anytime soon.
4. Satellite radio pays its debt to society
Sirius XM Radio (Nasdaq: SIRI) knows that its chunky debt and even chunkier share count may be holding it back. Thankfully it has the improving cash and free cash flow positions to do something about it.
The satellite radio provider is paying down its debt. Sirius XM is redeeming all of its outstanding 9.75% Senior Secured Notes due 2015. The media giant plans to retire the $186.1 million in debt during the first available window in September to do exactly that.
Sirius XM will have to pay a slight premium in the process, but it sure beats dealing with the stiff 9.75% annual interest expense that it's facing now.
5. Organic growth
Whole Foods Market (Nasdaq: WFM) is no ordinary grocer.
Traditional supermarket operators may be upsetting shareholders with lackluster financials and even an extreme case of a dividend suspension, but that's not Whole Foods Market's scene at all.
The leading organic grocer saw its revenue climb 14% to $2.7 billion in its latest quarter, assisted largely by an 8.2% uptick in comps. Earnings grew even faster, soaring 32% to a better than expected $0.63 a share.
The economy may still have its rough spots, but Whole Foods has been posting strong store-level performance for more than a year now. If premium natural groceries aren't off the table, the recovery may be shaping up better than worrywarts would have you believe.