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.
A few mixed earnings reports and rumors that the Federal Reserve will further cut its asset purchase amount at its next open committee meeting has investors flustered and the markets tanking. As of 1 p.m. EST, the Dow Jones Industrial Average (DJINDICES: ^DJI ) is down 80 points, or 0.5%, while the S&P 500 is higher by 0.05% and the Nasdaq is up 0.38%.
A number of Dow components released earnings this morning, and the biggest loser within this set is Verizon (NYSE: VZ ) which has lost 2.1% of its value so far today. The telecommunications company reported fourth-quarter revenue of $31.07 billion and earnings per share of $0.66, which both slightly beat analysts' expectations. But it seems the company's announced intention to acquire Intel Media is hurting the stock price. Intel Media is a start-up business within chip maker Intel that is focusing on Internet-based TV services. In the past we heard that Intel was looking to create a universal DVR device that would record every program on every channel and store them for a certain period of time, allowing users to stream those videos at their convenience. This certainly sounds like a crazy idea and could be the reason investors don't like the acquisition announcement.
Outside the Dow, the valuation and share price of iRobot (NASDAQ: IRBT ) continues to be stretched, as the stock is up 2.4% today. Investors have speculated for months that iRobot could be a new takeover candidate, as Google and Amazon.com have been on robotic buying sprees the past six months. But, as a few of my colleagues and other analysts have noted, the iRobot now just operates in the home cleaning business, which doesn't show a whole lot of growth and potential moving forward.
Shares of the controversial and high-flying high valuation stock Tesla (NASDAQ: TSLA ) are up 6.2%. The move comes as CEO Elon Musk is reportedly discussing the so-called "recall" the company is performing with its charging units. Musk is asking the National Highway Traffic Safety Administration to not refer to it as a recall, since Tesla decided to perform the fix without a federal mandate and because this is just a precautionary step to help minimize an already unlikely danger of fires from charging . Additionally, it's being reported this morning that hedge fund Blue Ridge Capital has taken a 500,000-share position in Tesla worth $96 million. This is another vote of confidence for the electric car manufacturer since the position was recently opened.
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