Today's 3 Best Stocks

Despite a full slate of earnings reports, a slew of economic data stole the show, with the broad-based S&P 500 (SNPINDEX: ^GSPC  ) swinging every which way today.

As you might have imagined by these swings, the data was generally mixed. In housing, the Case-Shiller Index rose 9.3% and indicates that home values in major cities are still healthfully on the rise. As long as inventories remain under control, this is a trend that could continue. Consumer confidence figures were also positive, coming in at 68.1, well ahead of forecasts. With consumer spending comprising such a vital part of U.S. GDP, a more positive outlook on the economy is likely to get consumers back out there and spending again.

However, the Chicago purchasing managers index dipped to 49 in April, well below forecasts -- and its lowest reading since Sept. 2009. Any level below 50 would indicate manufacturing contraction and bodes poorly for the near-term outlook for companies in the industrial sector.

All told, investors digested the gambit of news pretty well and boosted the S&P 500 by 3.96 points (0.25%) to another all-time record closing high of 1,597.57.

Leading the pack higher today is big-box electronics and appliance retailer Best Buy (NYSE: BBY  ) , which jumped 7.4% after it announced plans to sell its stake in its European business to its partner Carphone Warehouse Group for $775 million -- 84% of the deal is being conducted in cash. Wall Street is absolutely loving this move because it frees up Best Buy to focus on its core U.S. market and also adds extra cash to the company's bottom line. Given the positive in-store and online reaction we've seen to Best Buy's price-matching campaign, I'd say this rebound still has legs.

Investment management firm Invesco (NYSE: IVZ  ) , which typically caters to high-net-worth individuals and offers a myriad of ETFs, rose 6.8% after reporting its first-quarter results. For the quarter, profits jumped nearly 15% to $0.49 per share as clients and investors flooded into its ETFs. Total cash inflows totaled $19.2 billion for the quarter -- a record for the company. It also didn't hurt that Invesco boosted its dividend by 30% to $0.225 per quarter. Even after today's move, at just 13 times forward earnings, there could still be room to run higher.

Finally, beauty products maker Avon Products (NYSE: AVP  ) gained 4.1% after also reporting its first-quarter results. Total revenue dipped 4% for the quarter, but was hurt primarily by unfavorable currency translation. Volume dropped 3%, but was countered by a 3% jump in prices. The Street might appear pleased with Avon's stabilizing business, but I continue to see its volume declines and high representative turnover as discouraging. Price hikes seem to be the only way Avon can stabilize its domestic and overseas business, and that's a recipe that I'm fairly certain will lead to lost customers.

Will this turnaround continue?
The brick-and-mortar vs. e-commerce battle wages on, with Best Buy caught in the middle. After what might have been its most tumultuous year in history, there are now even more unanswered questions about the future for the big-box electronics retailer. How will new leadership perform? Will old leadership take the company private? Will a smaller store format work out for both the company and its brave investors? Should you be one such brave investor? To help answer all these questions, The Motley Fool has released a new premium research report detailing the opportunities -- and the risks -- in store for Best Buy. Simply click here now to claim your comprehensive report today.


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2398199, ~/Articles/ArticleHandler.aspx, 10/26/2014 12:32:53 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement