Home Depot, Macy's, and Zulily Shares Pop

Major indexes all in the green despite a drop in housing prices in December.

Feb 25, 2014 at 1:00PM

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.

As of 1 p.m. EST, the Dow Jones Industrial Average (DJINDICES:^DJI) was trading higher by 15 points, or 0.09%, the S&P 500 was up 0.05%, and the Nasdaq rose 0.01%. The S&P/Case-Shiller Home Price Indices, released today, indicated that housing prices have fallen for the second month in a row. For December, the 20-city index that tracks single-family homes prices in the major metropolitan locations around the U.S. fell by 0.1%. This follows a 0.1% decline in November, but on a year-over year basis the housing industry is still up and looking strong; with the final reading of 2013 now in the books, the index ended its best year since 2005. 

Despite the slight downtick in housing prices throughout the nation, shares of the Home Depot (NYSE:HD) were higher by more than 3.2%. The home-improvement retailer reported earnings this morning that beat on the bottom line but missed on the top line. Wall Street expected revenue of $17.92 billion and earnings per share of $0.71, but the company posted sales of $17.7 billion and EPS of $0.73. Home Depot also increased its dividend by 21% to $0.47 per share. The only real bad news was that guidance for the coming year was below what analysts were looking for. The company expects revenue of $82.59 billion for the full fiscal year, while Wall Street wanted to see $82.9 billion. Earnings per share are expected to hit $4.38, lower than the $4.42 analysts had estimated. All in all, though, these figures are strong and investors shouldn't be concerned about the slightly lower guidance.  

Macy's (NYSE:M) shares are up 4.7% after the department store chain reported fourth-quarter earnings this morning. The company posted revenue of $9.2 billion and earnings per share of $2.16, which both fell below analysts' estimates of $9.28 billion in sales and $2.17 in earnings. But the company saw strong 4.3% same-store sales during the holiday season, and management believes revenue at stores open more than a year will be up 2.5%-3% in the coming year. At a time when Sears and J.C. Penney are struggling with sales Macy's seems to have a winning strategy. Although everything is not perfect, investors seem to like what the company is doing.  

Lastly, the big winner of the day so far is Zulily (NASDAQ:ZU). The online flash sale retailer released quarterly earnings as a public company for the first time yesterday after the market closed and impressed investors. Shares of Zulily were higher by more than 39% today alone. The company earned $0.10 per share minus one-time items, while Wall Street expected EPS of just $0.03. Revenue hit $257 million, while expectations had been set at $225.5 million. Guidance for the coming quarter was set at sales of $225 million-$235 million and a net loss of $1 million-$5 million, but EBITDA earnings of $1 million-$5 million. Investors certainly believe that this new growth company can take off; they have pushed shares higher and the company's value to above $7 billion, despite the business not yet steadily turning a profit.  

Looking for the next BIG thing? Look no further

There's a huge difference between a good stock and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.


Matt Thalman owns shares of Home Depot. The Motley Fool recommends Home Depot. 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