Netflix Makes a Breakthrough, and Icahn Ruffles Feathers at eBay

The S&P 500 hit an intraday record high as two the biggest names on the internet made news. First, Netflix signed a landmark deal with Comcast for faster web access, and Carl Icahn revealed a stake in EBay, and accused it of a conflict of interest.

Feb 24, 2014 at 10:00PM

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.

Stocks kicked off the week with a bang as the S&P 500 topped its intraday record high as merger activity, and strong economic reports out of Europe, gave markets a lift. The broad-market index finished up 0.6%, closing at 1,847, while the Dow Jones Industrial Average (DJINDICES:^DJI) gained 104 points, or 0.6%, moving less than two percentage points away from its all-time high. The Nasdaq also hit a 14-year high in intraday trading. 

In Germany today, an important indicator of business confidence hit its highest level in two-and-a-half years, as the Ifo business-climate index hit a mark of 111.3, ahead of estimates at 110.6, showing proof that the European recovery continues to be on track

Back stateside, several deals seemed to spark the market's optimism. First, RF Micro Devices agreed to buy TriQuint Semiconductor for $1.6 billion. Both companies soared on the news, up 21% and 26%, respectively. Second, Men's Wearhouse lifted its offer to buy out Jos. A. Bank for $63.50 a share from an original price of $57.50.  The two men's clothing chains have engaged in series of offers and counteroffers to buy each other until Jos. A. Bank said it would purchase Eddie Bauer instead just two weeks ago. The Men's Wearhouse's offer is contingent on Jos. A. Bank dropping its bid to acquire the outdoorwear brand. As a result of the offer, Jos. A. Bank shares jumped 9%, to close at $60.04, while Men's Wearhouse gained 8%. Finally, Netflix (NASDAQ:NFLX) entered into an agreement with Comcast to purchase faster web access for its video streaming. The deal could lead to further changes in the broadband industry, and set a precedent for whether content or service providers will pay for infrastructure upgrades. Netflix shares finished up 3.4%, while Comcast closed nearly flat.

Elsewhere, Carl Icahn was making noise again, accusing eBay's (NASDAQ:EBAY) board of harboring a conflict of interest, and called again for the online auctioneer to spin off the payments processor PayPal. The investing wizard, who also revealed a 2.15% stake in the company today, said board members Marc Andreessen and Scott Cook had competing business interests, and called on them to resign. Icahn also asked investors to vote for two of his handpicked board members in their place. eBay responded by saying that Icahn was "mudslinging," and that it believed PayPal was of greatest shareholder value as a part of eBay. Shares of the online retailer finished up 3.1%, likely in response to news of Icahn's stake.

Stocks for the long haul
It's no secret that investors tend to be impatient with the market, but the best investment strategy is to buy shares in solid businesses and keep them for the long term. In the special free report, "3 Stocks That Will Help You Retire Rich," The Motley Fool shares investment ideas and strategies that could help you build wealth for years to come. Click here to grab your free copy today.

Jeremy Bowman has no position in any stocks mentioned. The Motley Fool recommends eBay and Netflix. The Motley Fool owns shares of eBay, Netflix, and TriQuint Semiconductor. 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.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

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.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information