Thursday, April 1, 2010

Super-size my McProfits please

Last night I was watching television and I saw a commercial that really made me think.  It was Dan Hesse, CEO of Sprint and in this commercial, he announced that Sprint has a brand new plan and unlike their big competitors, Sprint is offering unlimited data, calling and texting for $69.

Now, why I said this made me think is not because of Sprint's deal per se, I'm more interest to see how the rest of the cell titans will react. 

When it comes down to brass tacks, my experience tells me that Sprint's cell coverage is a bit sparse.   Truth is, Verzion and AT&T are pretty much the 2 big players when it comes service and in rural areas Verizion takes it every time.

So will Verizon and AT&T make a move like Sprint?  Will they cater to the recession-hit people of this country that until now are paying way too much money for cell service?

With the iPhone and blackberries pretty much dominating the market with AT&T and VZ, will customers start to jump ship? 

I don't think so. 

Will VZ or AT&T drop their prices in lieu of Sprint's new bundle?  I think not.

When it comes to quality, it's a supply and demand thing.  People demand good service and fast service for that matter and that demand I don't think necessarily that means Sprint.

IPO Market Set For Big Pickup This Week (Tim Fields)

Are you an IPO investor?  If not, you should be seriously considering it this week...

For the past 3 months, the IPO market has been anything but fast paced.  It had been molasses in February with not too many eye openers coming to light.  However, things are set to change.

This week, I'm watching 2 IPOs that have the potential to run because of a common bond; earnings.

The first is a dry bulk shipping start up.  They look to be a very promising company, being underwritten by some power – Morgan Stanley.  The company plans to raise $245 million by offering 16,300,000 shares at a price range of $14 to $16.

The next is the Texas Instruments spin off I wrote to you about last week.

The company is the world's leading supplier of sensors and controls across a broad range of markets and applications.

The company plans to raise $600 million by offering 31.6 million shares at $18-$20, and at the midpoint of the proposed range, it will command a market value of $3.4 billion.

The company booked $1.1 billion in sales for 2009, down 20% (from $1.4 billion) from the previous year. However, it stands to benefit from the improving environment and reported $338 million in sales for the fourth quarter of 2009, up 26% from the year ago period (from $268 million).

This company is entering at a very good time and I believe is should command the IPO market when it does debut.  It's a bit early for me to start throwing possible profits from this IPO, but I can tell you, it should be a solid performer.

Stay tuned for more information on these potential big winners, as I'll update you throughout the week.

Members of The 123 Advisor – look for an Investor Alert on these two companies in the coming days.

Want to learn more about The 123 Advisor and these two IPOs – follow this link.

Super-Size My McProfits Please (Eric Dickson)

What's not to love? I'd venture to say that almost any place you visit in the world, you'll see their golden arches. And it's not wonder that internationally, as well as domestically, McDonalds (MCD) is growing.

Today, MCD reported that sales at restaurants open at least one year grew by 4.8%, fueled by strong international demand. This is encouraging short-terms news for the company, as back-to-back increased sales months are a welcome sight for investors who saw declining sales in November and December.

Overall, the company saw an 11.2% increase in February sales (this included their franchising restaurants as well).

What makes this company so great?

In my opinion – everything.

The dollar menu was trend setting. Improved menu options are attracting new customers.  Their franchising operations are top notch. Internationally they're popular. And from investors stand point; well they just provide great value…

At $2.20/share, their dividend is very attractive and you can expect for it to grow bigger in the next 18 months (as it historically has). As far as price appreciation, in the last 5 years the best stock to buy has returned over 90%. These two factors alone make the case for a great long-term investment.

I've been recommending this best stock to buy for 3 years now. And I'll recommend it for another 30. Strong dividend growth, coupled with price appreciation and a globally coveted brand, this is one best stock I'd put in my nest egg.

Interested in $11/Share Gains? (Eric Dickson)

Forget for a second that this is a genetic diagnostic company with a unique product in high demand from global hospitals, doctors and patients…

Why?

A recent FDA clearance has investor's giddy about the effects it will have on the share price. How far will this position rise? Tough to tell, but with current demand beginning (and we emphasis 'beginning') to surge because of this news, it's not out of the question for this position to go as high as $17 a share from their current price of less than $6.

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