Press Esc to close

Welcome to Money Morning - Only the News You Can Profit From.

Close

We'll Tell You When It's Time to Tap Tesla

A week ago today, in a strategy story aimed at helping you survive and thrive in today’s whipsaw markets, Chief Investment Strategist Keith Fitz-Gerald told us to put Tesla Motors Inc. (Nasdaq: TSLA) on our “watch lists” for a likely future purchase.

“BP, Tesla is a definite ‘shopping list’ stock,” Keith told me back then. “We’ve been nibbling at it here, and have played it successfully several times. But it’s not yet at the point where I’m ready to jump all the way in. I think my rationale behind Tesla remains upbeat. I mean, you’ve got a real winning combination here – a disruptive sales model, a CEO who’s the most innovative guy on the planet, all the capital in the world that can be brought to bear. I don’t give a rat’s [tail] that New Jersey won’t let the company sell its cars there. There are much bigger opportunities. Wait ’til you see what the company does with China.”

Sometimes I think Keith has a “crystal ball” in his hip pocket…

  • Featured Story

    Yahoo (Nasdaq: YHOO) Stock Hopes Ditching Assets Will Spark Turnaround

    Finally, after all the negotiations and failed attempts at making a deal, Yahoo! Inc. (Nasdaq: YHOO) has agreed to let China's e-commerce company Alibaba repurchase its shares.

    In just over a week since Yahoo ousted CEO Scott Thompson for padding his resume, the search engine giant announced that it would sell half of its 40% stake in Alibaba Group Holding Ltd. with the possibility of selling the rest at some point.

    Yahoo will receive at least $6.3 billion in cash and as much as $800 million in newly issued Alibaba preferred stock, the companies said in a statement yesterday (Monday). At the time of an IPO, Alibaba will be required to either buy back a quarter of Yahoo's current stake or let Yahoo sell the shares.

    In the announcement, Yahoo also said it would use all of the sale's after-tax proceeds to repurchase its own shares, with the Yahoo board already having approved a $5 billion increase to the firm's current buyback program.

    The sale, strongly encouraged by analysts and investors, frees up some cash for Yahoo. Many have been waiting for this deal to come through as talks repeatedly failed over the past year between Yahoo's ex-CEO Carol Bartz and Alibaba.

    Some calculations suggest Yahoo may have let go of Alibaba at a steep discount. But a person familiar with the deal said there were provisions which would allow Yahoo to benefit if Alibaba is valued at more than $35 billion when it sets the pricing for its IPO.

    Furthermore, the move had to be made, and was one of five things that Money Morning's Keith Fitz-Gerald said he would do if he ran Yahoo.

    Read More...
  • yahoo ceo

  • More Reasons to Avoid Yahoo (Nasdaq: YHOO) Stock There's been no shortage of reasons for investors to avoid Yahoo! Inc. (Nasdaq: YHOO) stock this year.

    Yahoo, once revered as a web pioneer, has been stunted and dwarfed by those who followed in its footsteps.

    The storied Internet content company has been upset by an increasing number of competitors like search engine behemoth Google Inc. (Nasdaq: GOOG) and social networking giant Facebook Inc. (Nasdaq: FB), and been wounded by waning ad sales.

    Yahoo also is very late to the game in the battle for the mobile space, currently the biggest area of growth for the industry.

    And then there is the question of diminishing revenue, declining earnings and slumping stock price.

    Revenue fell by more than a fifth last year. Yahoo's stock price has slipped 17% over the past year, and 50% over the past five.

    "Yahoo just can't get its act together," Money Morning tech guru Michael A. Robinson warned in January, naming Yahoo a "tech stock to avoid" in 2012. "While key executives were napping, Google burst on the scene a decade ago and rewrote the rules of web search and advertising. Portals like Yahoo never regained their traction."

    As Yahoo's struggles continued, CEO Carol Bartz was recently let go with a phone call in September. In January, former PayPal president Scott Thompson was brought in as Bartz's successor.

    And now the latest replacement may soon be replaced himself.

    To continue reading, please click here... Read More...
  • Yahoo's New CEO: The One Thing Scott Thompson Needs to Do Four months after chief executive Carol Bartz was let go, Yahoo Inc. (Nasdaq: YHOO) appointed new CEO Scott Thompson to salvage the sinking Internet company and do something Bartz couldn't - win shareholder support.

    Thompson, most recently president of eBay Inc.'s (Nasdaq: EBAY) PayPal unit, is taking over the lead role. Yahoo is in dire need of new strategies to increase site traffic and attract advertisers if it hopes to defend against increasing competition from tech giants Google Inc. (Nasdaq: GOOG) and Facebook Inc.

    Shareholders were frustrated with the decision, however, since they were pushing for the struggling Yahoo to sell.

    "It's probably a slight negative because I think the best outcome for Yahoo would be an all out takeover by Microsoft," Brett Harriss, an analyst at Gabelli & Co., told Bloomberg News. "Hiring a new CEO makes the sale of the whole company unlikely."

    Thompson is the company's fourth CEO in five years. Now the pressure's on him to win over shareholders and inspire investor confidence before the share price plunges.

    Read More...
  • The One Thing New Yahoo Inc. (Nasdaq: YHOO) CEO Scott Thompson Needs to Do Four months after chief executive Carol Bartz was let go, Yahoo Inc. (Nasdaq: YHOO) appointed new CEO Scott Thompson to salvage the sinking Internet company and do something Bartz couldn't - win shareholder support.

    Yahoo announced yesterday (Wednesday) that Thompson, most recently president of eBay Inc.'s (Nasdaq: EBAY) PayPal unit, is taking over the lead role. Yahoo is in dire need of new strategies to increase site traffic and attract advertisers if it hopes to defend against increasing competition from tech giants Google Inc. (Nasdaq: GOOG) and Facebook Inc.

    Shareholders were frustrated with the decision, however, since they were pushing for the struggling Yahoo to sell.

    "It's probably a slight negative because I think the best outcome for Yahoo would be an all out takeover by Microsoft," Brett Harriss, an analyst at Gabelli & Co., told Bloomberg News. "Hiring a new CEO makes the sale of the whole company unlikely."

    Thompson is the company's fourth CEO in five years. Now the pressure's on him to win over shareholders and inspire investor confidence before the share price plunges.

    New Yahoo CEO Scott Thompson a "Surprising Choice"

    Thompson excelled at PayPal, contributing to its expansion into online daily deals and mobile payments and increasing PayPal users to more than 100 million.

    However, he has no experience with content - Yahoo's bread and butter. Yahoo Chairman Roy Bostock said Thompson's primary focus will have to be on the company's "core business" - providing content in subcategories like news, sports, and finance.

    "It's a surprising choice," Ken Sena, an analyst at Evercore Partners Inc. (NYSE: EVR), told Bloomberg. "Scott has a great track record in payments and has proven an effective executive at PayPal and has major tech chops and international experience, but as a content company, which Yahoo has increasingly become, his experience is kind of lacking."

    Thompson told investors he wanted to explore Yahoo's options in the mobile sector. He'll also help the company realize more value from its minority investments in Alibaba Group Holding Ltd., China's biggest e-commerce company in which it has a 40% stake worth $14 billion, and Yahoo Japan Corp., or decide if it's best to sell those assets. A sale would appease shareholders while the company regroups under Thompson's leadership.

    "If they can successfully complete the Asian asset transactions, in a way that is beneficial to Yahoo shareholders, I think it will buy them some time and they'll have a chance to build for growth," Ryan Jacob, of the Jacob Funds, told Reuters.

    To continue reading, please click here... Read More...