FB Gets Earnings Love and Starbucks Beats Dunkin's Stock

Good morning, good lookin'... The three things you need to know on April 25th are:

Apr 25, 2014 at 6:00AM

Happy #ThrowbackThursday. For the first time since 2001, the Dow (DJINDICES:^DJI) finished flat, exactly where it started the day. Meanwhile, the S&P 500 rose three points for its seventh gain in eight days. Mazel tov.

1. Facebook revenues boom with mobile domination
Once upon a time, Facebook (NASDAQ:FB) had a humiliating IPO and was making a cute $53 million a year in profit. On Wednesday, after the New York stock markets closed (Zuckerberg follows Pacific Coast time), Facebook announced first-quarter earnings of $642 million. Facebook is growing into a fully grown, mature company to be reckoned with -- and the markets boosted the stock right after the bell well over 4% higher (but Zuck still dresses like a 21-year-old dropout).
Facebook hit a billion mobile monthly active users. Revenues grew a whopping 72%, to more than $2.5 billion. It's all driven by mobile ads, which now make up 59% of overall revenues.
Why did Facebook stock end down 0.8%? The MarketSnacks team just asked Jeeves that question, and there's still no good answer. One factor could be the announcement of the current CFO's departure this June, but mostly, Wall Street had an episode of craziness -- the stock price crossed from green to red seven times.
2. Starbucks' earnings performance beats Dunkin'
There's nothing small or "tall" about these numbers. Ol' Starbucks' (NASDAQ:SBUX) earnings report matched Wall Street's expectations, with a healthy $3.9 billion in revenues during the first three months of 2014 -- a 9% rise from the same period last year.

In the world of more mediocre coffee, things weren't as pretty. While Starbucks' same-store sales increased by 6% for the quarter, Dunkin's only gained 1.2%. The discrepancy sent Starbucks stock up 1% and Dunkin's down 1.9% Thursday.

So why the tale of two lattes? The majority of Dunkin's stores are located in the cold winter-battered northeast, where Red Sox fans are apparently too soft to leave home and spend money on coffee. Starbucks never mentioned U.S. weather in its earnings report -- the company's sales are saved by its international presence. And it plans on opening 1,500 new stores in 2014, with half in Asia.
3. GM's profits crashed by 3+ million car recalls
This is going to be bad. General Motors (NYSE:GM), the biggest car company in America, had to announce first-quarter earnings. It was bad... profits fell to $125 million compared to $865 million last year. If you need to know why GM's profit fell so far, you probably don't watch the Daily Show or late night comedy or the news. Hint: It involves a 10-year cover-up of broken GM cars...
GM Recalled more than 3 million cars, and it cost a lot of money. Wall Street actually predicted this recall disaster would cause an even bigger profit drop. The minute news came out in February that GM cars were shutting off in the middle of the highway because of heavy swinging key chains, investors began selling GM stock. It's down 3% since mid-February, which is about $1.6 billion of value when you look at the Market Capitalization. But GM only wrote off $1.3 billion in total expenses for the recall, so Wall Street was actually pleasantly surprised.
Besides the bad news, the business was actually solid. If you forget about the huge recall expenses, GM's result really smoked the Street's expectations like a Vin Diesel-driven GTO muscle car. Wall Street analysts ignored the huge 83% profit drop headline, and bought the stock up 3% early before it eventually fell just 0.6% Thursday. GM's new, not horribly dangerous cars, are selling pretty well right now.
  • Reuters/UMich Consumer Sentiment Poll
  • First-Quarter Earnings: Burger King, Ford
As originally published on MarketSnacks.com

Three stocks to own for the rest of your life
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. 

Jack Kramer has no position in any stocks mentioned. Nick Martell has no position in any stocks mentioned. The Motley Fool recommends Facebook, General Motors, and Starbucks. The Motley Fool owns shares of Facebook and Starbucks. 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