Stocks Get a Kiss for Valentine's Day, Cable Giants Embrace, and Wall Street Loves Janet Yellen (So
Enjoying the Presidents Day three-day weekend on Wall Street by stuffing yourself with your roommate's leftover Valentine's confectioneries? Take a break from that chocolate truffle binge and check out what pushed the stock market to its best/hottest week of 2014.
1. Stocks popped on Valentine's Day
Investors found their mojo on Valentine's Day. U.S. econ data released Friday was pretty ugly: January retail sales were flat, and industrial production fell 0.3%, when analysts expected a rise. But investors have been blaming most of the economic unimpressiveness on the ungodly bad weather nationwide over the past month and decided to ignore the news Friday, pumping the Dow up a lovely 127 points. Although the economic recovery gained steam over 2013, 2014 has not been a kind lover to investors so far.
2. A fourth-quarter earnings winner
Campbell Soup earnings heated up as the company slimmed its spending on marketing last quarter. Overall, Campbell's earnings surged 71% last quarter, getting investors hungry enough for the stock to pump it up more than 5% Friday.
But what's really heating up at Campbell? It's a lot more solid than soup -- ready-made meals, like its Simple Meals division, enjoyed a 7% rise in sales. Plus, Campbell's fastest-growing food are snack attacks, like its Goldfish and Pepperidge Farm cookies, with a 14% sales jump worldwide.
The takeaway is that Campbell has introduced diversity into its lineup -- and just like investors enjoy diversifying their assets to minimize risk, the same philosophy is paying off for Campbell. If soup isn't what people are craving, at least snacks are.
3. ... and a fourth-quarter earnings loser
Profits for Weight Watchers plummeted nearly 50% as customers turn to better-looking diet apps and personalized health programs. And investors took note -- slamming the stock for a 25% fall on Friday.
It's not as if Weight Watchers hasn't been trying -- from a marketing standpoint, many analysts believe they're playing things by the book. To improve recognition and entice more customers, the company went on a serious celebrity-endorsement spree in 2013, including your favorite '90s basketball legend, Charles Barkley, as a spokesman.
The takeaway is that the real scare for Weight Watchers is that there wasn't as much of the usual January boost to sales that it and other diet companies plan for around Jan. 1. It looks as if most investors' New Year's resolutions will be to just sell the stock.
4. Plenty of merger-and-acquisition love
On Friday, men's corporate dresser Jos. A. Bank decided to step into the big outdoors and buy Eddie Bauer for $825 billion in cash and stock. And earlier in the week, Comcast reported that it will merge with mediocre-to-horrible cable service Time Warner in an all stock plan -- Comcast is snagging all 285 million Time Warner shares (worth $45.2 billion), while Time Warner stockholders will get about three Comcast shares in exchange (unless the anti-monopoly Justice Department turns the deal into a soap opera).
5. Janet Yellen's big day
In her first major policy speech since taking over the throne at the Federal Reserve, fresh-faced Chairwoman Janet Yellen acknowledged that the economic recovery improved over 2013 and that the central bank will continue to slow its stimulus policies -- but added that the Fed doesn't have a set timeline for doing so yet. Investors loved the fact that economy-boosting stimulus juice isn't drying up anytime soon, and sent the stock market up to its best day in months on Tuesday.
What MarketSnacks is checking out this week:
Monday: Stock market closed for Presidents Day
Tuesday: New York "Empire State" manufacturing survey; earnings: Coca-Cola, Herbalife
Wednesday: Minutes from the Fed Meeting; earnings: Tesla Motors, Marriott Hotels
Thursday: Weekly jobless claims; earnings: Wal-Mart, Nordstrom
Friday: Existing-home sales; earnings: DISH Network, Billabong
MarketSnacks Fact of the Day: Strawberry was the most popular flavor of new candy last year (it was the main flavor in 8% of new confectionery launches).
As originally published on MarketSnacks.com
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Nick Martell has no position in any stocks mentioned. Jack Kramer has no position in any stocks mentioned. The Motley Fool recommends Coca-Cola and Tesla Motors; owns shares of Coca-Cola, Tesla Motors, and Weight Watchers International; and has options on Herbalife. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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