January Home Sales Dip, American Railcar Industries Jumps Again

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.

Stocks finished off the shortened week of trading with a whimper on Friday, as mediocre housing data failed to either impress or depress investors. Existing home sales fell 5.1% in January from last January, though median home prices rose more than 10% in the same period. The sales slump was roughly in line with expectations, and the months ahead should give a better idea about whether weather played a role in the falling sales. An uninspired Dow Jones Industrial Average (DJINDICES: ^DJI  ) fell 29 points, or 0.2%, to end at 16,103. 

The services sector was the second best-performing sector in the stock market today. Entertainment behemoth Walt Disney (NYSE: DIS  ) finished as the Dow's top performer, adding 1.2%. With ABC, Disney, and ESPN all under its belt, the company makes more in TV distribution fees than any other company in the world. If "cord-cutting" -- the tendency of consumers to stop paying for cable in favor of online content – catches on, Disney's distribution fees will likely take a hit. This is why the forward-looking Disney has teamed closely with Netflix to distribute its content in the age of streaming. 

Shares of American Railcar Industries (NASDAQ: ARII  ) , which makes, sells, and leases railcars, jumped 9.1% on Friday, just a day after the stock rallied more than 14% on the heels of a robust earnings report. The $1.3 billion American Railcar Industries is a direct beneficiary of the domestic energy boom, as demand for the transportation of oil and gas rises with energy production. The rail industry represents an interesting derivative play on America's energy renaissance, and American Railcar shareholders are sitting pretty right now; margins are rising, and the board approved a 60% dividend increase only two days ago. 

Lastly, shares of Tile Shop Holdings, (NASDAQ: TTS  ) , a specialty tile retailer, surged 13.9% on Friday. Not surprisingly, this pop was also sparked by a strong earnings report. That all-important metric for any retailer, same-store sales, edged up more than 10% in the fourth quarter, and was up 12.4% in 2013 as a whole. Retailers can only boost revenue by opening more stores or increasing their sales at existing stores, so Tile Shop currently has half of that equation figured out. Incidentally, it has the other half figured out, too, growing its store base by 30% in 2013; now, all it needs to do is turn consistently profitable!

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