This Week's 5 Smartest Stock Moves

These five companies got it right.

May 30, 2014 at 5:33PM

If you're feeling good about the market, you're not alone. Take my hand as we go over some of this week's more uplifting headlines.

1. Beats of a different drum
Apple (NASDAQ:AAPL) made it official on Wednesday. The consumer tech giant is buying Beats Electronics and Beats Music in a $3 billion deal. The market has come a long way toward embracing the deal. Apple's market cap took a $2 billion hit the day the well-sourced rumor first surfaced several weeks ago, but the company is hitting new 52-week highs on Thursday after the deal was confirmed, which validates the move.

It's a smart deal no matter which way the stock headed. Apple makes great hardware, but consumers often turn to third-party providers of accessories. Beats Electronics sells premium headphones at healthy markups. Apple will also improve its digital music position with Beats Music. It has only attracted 250,000 paying members since its January launch, but that should ramp up now that Apple's marketing muscle is behind the on-demand music service. 

2. Stoking the Fire place
Amazon.com (NASDAQ:AMZN) has only had its Fire TV set-top box on the market for less than two months, but it's running a clever limited-time promotion to increase adoption without coming off as desperate with "Fire" sale pricing. Amazon is currently selling a bundle that pairs up a Fire TV with a Kindle Fire HDX tablet for $79 less than buying both separately. 

In other words, if you were going to buy a Kindle Fire anyway, the Fire TV is just $20 more. If you were going to buy a Fire TV, the high-end Amazon tablet is just $150 more. It's a great way to offer a sale so early in a product's life cycle without an actual price cut to infuriate the early adopters. 

3. It's a pretty picture
It's a competitive market for camera chips, but OmniVision Technologies (NASDAQ:OVTI) is making it work. The maker of image sensors used in digital cameras, smartphones, and tablets posted better-than-expected quarterly results on Thursday, offering up encouraging guidance as a bonus.

OmniVision saw revenue slip less than 2% to $331 million, but adjusted earnings climbed 37% to $23.9 million, or $0.40 a share. Analysts were holding out for less on both fronts. The midpoint of OmniVision's guidance for the current quarter is also above where analysts are currently parked. Challenges remain for OmniVision to begin growing revenue again, but it's been blowing Wall Street's profit estimates away with ease in recent quarters.

4. NQ bounces back
NQ Mobile (NYSE:NQ) burned investors earlier this month by having to extend the filing deadline for its annual report -- twice -- but the Chinese provider of mobile Internet services bounced back after offering up an encouraging update on Friday morning.

NQ Mobile now sees net revenue for the first quarter surpassing the 125% year-over-year growth that it was originally targeting. Its initial outlook for the current quarter calls for revenue to more than double to between $83 million and $84 million. Analysts were only holding out for $78.9 million on the top line.

Naturally, NQ Mobile still has plenty to prove. Skeptics will wait for audited financials before forgiving the company. However, it's a good indication that NQ Mobile will be a pretty ridiculous value if its accounting does hold up.

5. Par for the Kors
Luxury handbags may not seem like much of a growth market, but it is if you're a speedy market darling continuing to take share from a fading giant. Michael Kors (NYSE:KORS) posted another blowout quarter this week. 

Revenue soared 54% to $917.5 million and net income climbed 59% to $151 million, or $0.78 a share. Analysts were only forecasting earnings of $0.68 a share on $816.2 million in revenue. Strong wholesale activity and a 26.2% spike in comps on an expanding store base helped propel the impressive results. Michael Kors has blasted through estimates consistently since going public three years ago. Another strong report is likely in the bag.

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Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Amazon.com, Apple, and Michael Kors Holdings. The Motley Fool owns shares of Amazon.com, Apple, and Michael Kors Holdings. 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.

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