Being like Mike is a key part of Nike's success. The company's Air Jordan shoe line was launched way back in 1985; the basketball sneakers still own the majority of the market, like Jordan shooting from just outside the paint, earning $2.25 billion in sales last year. Plus, even the secondary market for Air Jordan's has got game, with $62 million in used Air Jordan sales on eBay last year.
So why'd the stock drop more than 3% in after-hours trading following the earnings news? The company's outlook. Investors didn't pour a cooler of Gatorade on CEO Mark Parker because he announced, as part of the report, that the company anticipates foreign-exchange financial issues to slow earnings growth through 2015.
2. Starbucks up on alcohol news
Drinking at Starbucks finally got interesting. Shares of Starbucks (NASDAQ: SBUX ) rose 1.4% Thursday after a report that the megachain will start serving alcohol at more locations. Starbucks' wine and beer experiment has been going on in two dozen stores across seven U.S. cities for long enough that the company is bringing the booze nationwide.
It's not just the drinks; Starbucks is unleashing a full evening menu to boost post-coffee-time sales, with bacon-wrapped dates, truffle mac and cheese, and parm-crusted chicken. Now, the mediocre aspiring hipster writers who spend hours in the same Starbucks seat have a reason to spend even more than 75% of their day in the coffee shop.
Things in the homebuilding business were damn good last quarter, according to Lennar Corp's (NYSE: LEN ) first-quarter earnings report. From December to February, Lennar built and delivered an insane 3,597 homes, and generated $1.4 billion of revenue. That's 38% better than last year. What pleased investors the most was that bottom-line profit of $78 million was way up from last year's $45 million.
The year 2013 was a great one for houses, and Lennar cashed in. LEN stock jumps all over depending on housing market reports, and consistent rises in home prices and housing starts resulted in big paydays the past three months. Everything looked good in Lennar's report, especially the number of people who actually moved into their new pads, paying an average of $316K for them.
Why did the stock fall 2.5%? It's Janet Yellen's fault. The new Federal Reserve Chairwoman made some remarks at yesterday's big news conference that hinted at interest rate increases more quickly than expected. Lennar's business is at the mercy of long-term interest rates because of the mortgages people need to buy homes. Wall Street ignored the great last quarter, and looked forward to a spooky period of rising interest rates that will affect new home sales.
- Business expectations from the Atlanta Fed
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.