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.
1. Green Mountain counts its beans
Green Mountain Coffee Roasters delivered a textbook example of a mixed quarter. Revenue and earnings growth blew past Wall Street expectations, but the Keurig company's guidance for the current quarter confirmed the market's fears that private label K-Cups are eating into its once-thriving portion-pack business.
The whims of the market could have taken this stock either way. The fiscal fourth quarter was spectacular, with adjusted revenue and earnings up 22% and 56%, respectively, after backing out the extra week from the prior year's period. However, the dramatic slowdown expected during the fiscal first quarter is pretty alarming.
Shares of Green Mountain ended up soaring 14% on the day, and a good reason why it zigged when the future is zagging -- and sagging -- is that it introduced a $0.25-per-share quarterly dividend and added another $1 billion to its buyback authorization. The repurchases should help keep selling pressure in check, and the payouts will reward the investors who wait out the lull.
2. Caps and robbers
There's a new way to enjoy SodaStream's carbonated beverages.
SodaStream Caps is being introduced as a single-serve capsule to flavor a liter of carbonated water. Yes, it does look a little like a Keurig K-Cup, but essentially it's a manual portion pack that dispenses the syrup the moment that it's pressed down into a reusable SodaStream bottle.
SodaStream showed off the product early last year, and the capsules have even appeared in SodaStream's ads. Now they will be available in the U.S. exclusively through Bed Bath & Beyond until other retailers begin stocking SodaStream Caps next year. They're not cheap: The eight-count packs start at $5. However, it will be a cleaner and more convenient way to enjoy the product. At the end of the day, that makes this a smart move.
3. Tesla heats up its coverage
Tesla Motors has gone one of this year's hottest stocks to one of its biggest recent laggards, but the electric-car maker is doing something about it.
Car fires -- more specifically, three isolated incidents where Teslas caught on fire after driver accidents -- have held back investor enthusiasm in Tesla. The stock has surrendered 37% of its value since peaking toward the end of September. To counter the fire fears, CEO Elon Musk revealed that the Model S warranty will now cover fire damage, even if it results from a driving accident.
Sure, folks who can afford a Model S are probably more concerned about the safety aspects during a car fire than the actual financial damage. Nevertheless, it's a comforting thing to offer at a time when Tesla has run into a rare streak of bad luck.
4. DirecTV hits the road
It isn't easy being a pay-TV provider. The industry's audience has suffered sequential declines in four of the past six quarters. One setback to cable and satellite television providers is that some can only offer streaming access on tablets and phones within the range of customers' home Wi-Fi networks.
Really? Why would someone want to stream a show on a tiny phone or tablet with a TV in the same room? The allure of mobile streaming as a retention tool for pay TV has to include portability of that access.
DirecTV is following a few pioneers into this niche, offering 30 of its channels outside of homes through iOS and Android apps. Hopefully, in time more of the 100 channels that can be streamed at home will follow. Pay TV can't afford to take its audience for granted.
5. Recliner doesn't decline
La-Z-Boy investors can relax, and they may as well do it in a La-Z-Boy recliner. The maker of furniture including the signature recliner posted better-than-expected results. Sales soared 14% during the quarter, fueled by a nearly 10% gain in same-store sales.
La-Z-Boy has benefited from the housing boom, as folks moving into new digs often decide to spring for new furnishings. It goes without saying that earnings also blasted through analyst targets.
La-Z-Boy also decided to reward its investors, boosting its quarterly dividend rate by 50%.
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The article This Week's 5 Smartest Stock Moves originally appeared on Fool.com.Longtime Fool contributor Rick Munarriz owns shares of Green Mountain Coffee Roasters and SodaStream. The Motley Fool recommends DirecTV and Green Mountain Coffee Roasters. It recommends and owns shares of SodaStream and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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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