Yahoo!'s Bad Earnings, Ford's Good Ones -- and Some (More) Good Housing News

Good morning, good lookin'. Here are the three things you need to know on Jan. 29.

Jan 29, 2014 at 6:00AM
Sit down, relax, and sink your face into some of the new Oreos flavors (we like "marshmallow crispy") -- because the Dow Jones Industrial Average (DJINDICES:^DJI) rebounded 91 points Tuesday from its longest losing streak since June. The Federal Reserve's two-day policy meeting has begun, but Wall Street was more focused on corporate earnings.

1. Yahoo! earnings don't earn the exclamation point
Apparently, purple isn't the new black. Shares of your favorite middle-school search engine, Yahoo! (NASDAQ:YHOO), dropped 2.4% in after-hours trading following the company's earnings report Tuesday afternoon, which missed expectations. Although its earnings rose over 2013 from 2012, Yahoo!'s overall revenues fell as display ads saw much less action.

Last year was a busy, busy one for ol' Yahoo! In the tech company's effort to become relevant again, fresh new CEO Marissa Mayer went on a buying spree that would have made Samantha Jones jealous -- those purchases included Tumblr, Evntlive, Ptch, Bread Labs, and a bunch of other random tech start-ups with ridiculously spelled names that you've never heard of.

The takeaway is that Wall Street may not have been pumped about the earnings report, but there's one Yahoo! investment that investors are gaga over: Alibaba. Yahoo! owns 24% of the Asian eBay/Amazon.com fusion giant (since 2005), and Yahoo!'s revenues from Alibaba have popped 50% since last year -- now Wall Street is wondering whether Alibaba will have its IPO this year, which would reward Yahoo! handsomely.

2. Ford drives to an impressive fourth quarter
Take that, Toyota. Shares of America's classiest of auto manufacturers, Ford (NYSE:F), gained Tuesday on word that the company's $36 billion rise in revenues last quarter capped its best annual performance in years. Ford has been aggressively improving sales in the homeland, offsetting a slight decrease in sales in Europe and South America -- folks just love the Ford Focus.

The takeaway is that Wall Street isn't only excited by the fact that Ford reaffirmed its strong projections for the rest of 2014 -- Ford is also adding some muscle to its legendary F-150 truck. Ford is introducing a new, lightweight aluminum body to the F-150 this year, which will be just as strong, add even more tow capability, and cut 700 pounds from the frame -- and investors think America will buy.
 
3. Home prices raise the roof
Home prices rose by 13.7% in November compared with the year before. That's the hugest rise since February 2006 (which is practically 2005, for all the mathematicians out there). This is crucial measure of American wealth, since homes are the biggest assets of many families. High home prices boost net worth for Americans, which leads to more confidence and higher consumer spending, so Wall Street ate it up
 
The Case-Shiller home Price Index measures average home prices in 20 U.S. metropolitan areas. Despite a jump in long-term interest rates since May that caused demand for new mortgages to wane somewhat, a low supply of available homes out there is keeping prices high. Las Vegas and San Francisco had the biggest jumps, at more than 20% each. Stocks that rely on consumer spending benefited from the news, but housing stocks benefited more.
 
An index of home stocks practically exploded on the news. But specifically the homebuilder D.R. Horton (NYSE:DHI) jumped 9.8%. If the market is hot, people and businesses are more likely to build homes. You should feel good at your home while watching the Super Bowl this weekend (13.7% better than last year, at least).
 
Today:
  • The two-day Federal Reserve policy meeting ends
  • Fourth-quarter earnings: Facebook, JetBlue
 
As originally published on MarketSnacks.com.

Jack Kramer and Nick Martell have no position in any stocks mentioned.The Motley Fool recommends Amazon.com, eBay, Facebook, Ford, and Yahoo! and owns shares of Amazon.com, eBay, Facebook, and Ford. Try any of our Foolish newsletter services free for 30 days. 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.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers