Dow Surges 165 Points as Pandora Media Rebounds

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

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.

Wall Street is not known for its rationality. It's a place of chaotic swings, where billions of dollars change hands each day as the emotional pendulum swings between euphoria and despair. Today, for some reason, Wall Street was much closer to euphoria, even as the long-awaited monthly jobs report came in significantly below expectations. The economy added just 113,000 jobs last month, a far cry from the 189,000 analysts were calling for. Despite this, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) surged 165 points, or 1.1%, to end at 15,794. 

Wal-Mart Stores (NYSE: WMT  ) tagged along for the ride, adding 1.3% on Friday, ending as one of the Dow's top gainers. There was no significant news today surrounding the world's largest retailer, but going forward, keep an eye on Wal-Mart's international expansion plans, which should be closely scrutinized by shareholders. Its push into the low-margin grocery business in the last decade has proven to be a sound strategy, and the company recently announced plans to invest heavily in the grocery business in its Canadian locations, as well.

Shares of a company with far greater growth potential, Outerwall (NASDAQ: OUTR  ) , rallied 12.2% Friday, as it announced plans to execute a $350 million share repurchase program, which began in earnest today. The current market value of Outerwall stock is just $1.93 billion, so today's announcement represents a significant commitment by the owner of the DVD-rental service Redbox, and change-conversion kiosk Coinstar. Today's announcement is great on the face of things, but competitively speaking, Outerwall's Redbox service will need to embrace online streaming to stay relevant -- a task that could be hard to do with such a multitude of competitors in the space already. 

Lastly, shares of Pandora Media (NYSE: P  ) added 6.6% Friday, rebounding from Thursday's steep 10.1% sell-off. Shares of the streaming music provider took a hit yesterday after the company's full-year guidance managed to underwhelm investors. Pandora's growth is inevitably slowing as, like Redbox, the business faces an increasingly crowded field of competition in streaming media. It's nice to see Pandora finally turn a quarterly profit, but I don't think the company's competitive advantages are strong enough to merit the stock as a long-term cornerstone of a solid portfolio.

The Motley Fool's three stocks to own forever
As every savvy investor knows, Warren Buffett didn't make billions by betting on half-baked stocks. He isolated his best few ideas, bet big, and rode them to riches, hardly ever selling. You deserve the same. That's why our CEO, legendary investor Tom Gardner, has permitted us to reveal The Motley Fool's 3 Stocks to Own Forever. These picks are free today! Just click here now to uncover the three companies we love. 

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: 2829590, ~/Articles/ArticleHandler.aspx, 8/30/2015 10:48:45 PM

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...

John Divine

Fool since 2012, unique fingerprints since birth. Age 7: Put lifetime savings ($18.37!) in the bank, became disillusioned with low interest, and a fascination with the stock market was born.

Today's Market

updated 2 days ago Sponsored by:
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 1.21 0.06%
NASD 4,828.33 15.62 0.32%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/28/2015 4:55 PM
^DJI $16643.01 Down -11.76 -0.07%
OUTR $62.48 Down -0.35 -0.56%
Outerwall CAPS Rating: ***
P $18.10 Up +0.61 +3.49%
Pandora Media CAPS Rating: *
WMT $64.94 Down -1.14 -1.73%
Wal-Mart Stores CAPS Rating: ***