Microsoft and J.C. Penney Can't Seem to Find Good Management

The Dow and S&P 500 head south while the Nasdaq climbs higher after a better-than-expected jobs report.

Jan 8, 2014 at 1:00PM

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

With ADP reporting that private-sector job increased by 238,000 last month, a figure higher than the 200,000 jobs economists had expected, one would imagine the major indexes would take that news and continue yesterday's rally. While the Nasdaq is doing just that, up 0.28% at 1 p.m. EST, the Dow Jones Industrial Average (DJINDICES:^DJI) is down 0.46%, and the broader S&P 500 has lost 0.05%.

One reason the blue-chip index is off today is Microsoft (NASDAQ:MSFT), which is lower by 1.6% this afternoon. The move comes after Ford (NYSE:F) CEO Alan Mulally said Tuesday he will not leave his job this year. After months of speculation that Mulally was the top choice to replace Steve Ballmer as Microsoft CEO, we finally have confirmation that won't happen This news certainly isn't something that some Microsoft shareholders wanted to hear, but this will enable both companies to move ahead and allow Microsoft to continue looking for its next leader. While shares of Microsoft are heading south, Ford's are up 1.7% at this time.  

Outside the Dow, one big loser is J.C. Penney (NYSE:JCP), as shares are currently down 8.1%. After four straight days in which its share price fell 10.5%, the retailer's management team released a statement saying that it is pleased with holiday sales figures, but it didn't release any actual numbers. The lack of information has investors speculating that the holiday shopping season wasn't as good as the company makes it sound, and thus shares are tumbling. The problem for J.C. Penney is that right now it's better to say nothing at all than to say just a little.  

Management certainly has its work cut out for it in saving the department store chain, but worrying about the stock price should not be on that list. No management team should worry about the stock price -- it should focus on building a great business, and the share price will take care of itself. J.C. Penney investors need to reconsider their position and who is driving the ship at this point, before rougher seas are reached.

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Fool contributor Matt Thalman owns shares of Ford and Microsoft. Check back Monday through Friday as Matt explains what caused the Dow's winners and losers of the day, and every Saturday for a weekly recap. Follow Matt on Twitter @mthalman5513

The Motley Fool recommends Ford. The Motley Fool owns shares of Ford and Microsoft. 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.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.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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