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Welcome to The Motley Fool Take's Razzle Behind the Dazzle Spectacular Super Bowl Special! (Okay, maybe not, but we just had to be part of the hype.) The Motley Fool 50 Index treaded water through most of Super Bowl week, falling slightly less than 1% in anticipation of the big game. We'll send you off on your weekend with plenty of food for thought (don't forget to try the avocado-mango salsa), so put on your game face and check out today's Motley Fool Take:
Can you base your investment strategy on who wins the Super Bowl? Well, sure, if you're out of your head. You can even make it sound logical. Consider this: The Dow has risen for the year 22 of the 25 times when the National Football Conference (NFC) has won the game (or when the winner is an AFC team from the pre-merger NFL, like the Steelers or Colts). The Dow has fallen 7 out the 10 years the American Football Conference (AFC) has won. Those stats will probably lead more people to root for the NFC's St. Louis Rams this year, but many of us contrarians at the Fool -- who invest in great companies we want to partner with, not via cockamamie investing schemes like some people -- wouldn't mind seeing the underdog AFC New England Patriots find a way to pull this one out. The winner of the game has correlated with the direction of the Dow in 29 of 35 years, or 83% of the time. Heck, that's just about the same percentage of managed mutual funds that trail an S&P 500 index fund in a given year. And if you're thinking of investing according to who won the Super Bowl, that's exactly where we suggest you put your long-term dollars: an index fund.
United Airlines parent UAL Corp. (NYSE: UAL) continued to suffer from the fallout of Sept. 11, posting a fourth-quarter loss of $640 million before special items (i.e., before the losses were offset by the taxpayer-funded bailout, among other items). Revenue dropped 39% from last year's Q4. Most of the other major airlines aren't "faring" much better. According to Reuters, seven of the top eight domestic airlines stayed in the red for the fourth quarter, posting a combined loss of approximately $3 billion. The only airline that posted a Q4 profit was Southwest Airlines (NYSE: LUV), which, as pointed out when CEO Jim Parker appeared on The Motley Radio Show last week, boasts a market cap bigger than Delta, United, American, and Northwest combined. If there was any good news from UAL today, it's that folks are returning to the skies. In fact, United plans to add 127 daily departures in April. Unfortunately, the yield (the amount customers are really paying, after discounts and sales) remains low. In other words, the post-9/11 discounts have lured travelers back, but not so much that airlines can increase prices. There are other signs that the travel industry is on the road again. Yesterday, hotel chains MGM Mirage (NYSE: MGG) and Starwood Hotels (NYSE: HOT) posted better-than-expected fourth-quarter results. Expedia (Nasdaq: EXPE), which relies on a mix of airline tickets and higher-margin travel packages, reported fourth-quarter revenue that doubled last year's sales. But industry execs and analysts agree: The recovery will be more like a lazy cruise down the Mississippi than a ride on the Concorde.
Sleeping Beauty is turning over but she's still in deep slumber. Media giant Disney (NYSE: DIS) reported a 7% slide in first-quarter revenue and an even sharper decline in operating profits. While the company's $0.15 a share showing in pro forma profits beat the street by a nickel, it's Disney that is having problems sparing a dime. The company is looking to close out the rest of the fiscal year with a 15% dip in operating profits. There once was a time in which a growth company taking steps backward was something out of Neverland. Disney used to lead by example, now it follows in desperation. The company that brought new life to the prime-time game show genre with Who Wants to Be a Millionaire? has become The Weakest Link in the weekly network ratings. The company that revolutionized the theme park industry just suffered a 20% attendance drop at its sorely neglected Florida resort stronghold. The company that pioneered feature-length animation doesn't have an in-house produced entry with a shot at the first-ever animated film Oscar to be presented at the 74th annual Academy Awards next month. Worse still, the dethroning of the former Lion King will be televised on ABC. Media and leisure companies are smarting to the point of being dumbfounded right now, but Disney is leveraging the sector-wide ailment. It's suffering from a bloodied ad market, compounded by the fact that it has slipped in the ratings with no lifeline in sight until the fall season at the earliest. It's suffering from a travel-weary vacation industry, made worse by the fact that no other amusement park chain is reporting this kind of double-digit shortfall at the turnstile. The company can't even earn the respect of its partners. After painting a healthy picture of its 50-50 relationship with Pixar (Nasdaq: PIXR) during last night's conference call, Pixar chimed in this morning to clarify that all that's left to deliver under the current deal is just three more computer-rendered flicks -- all presently in production. Disney, you've got a friend in who? Can Disney bounce back like Tigger? How will ABC recapture ratings gold? Are Disney Imagineers sleeping at the wheel or simply shackled to the status quo? Where does ESPN fit into the Disney strategy? What exactly is pin trading and will it work for my bowling league? All this and more -- in the Disney Discussion Board. Only on Fool.com. No matter who wins the game, big-time money will exchange hands. And we're not talking about betting that 14-point spread. The fees charged for advertising are the highest of any production on TV. However, this year, with competition from the Olympics and people and advertisers in less of a spending mood since Sept. 11, ad rates for the big game have actually dropped a bit. As late as Tuesday, Fox still had a few 30-second spots available (out of 60 slots to sell), and the average price for ad spots had declined to just under $2 million (Friends, the top-rated prime-time show averages about $400,000 per ad). Compare that to 2000's Super Bowl when 17 dot-com advertisers ponied up an average price of $2.2 million and bought 40% of the commercial time.... Ahh, let us pause for a moment to remember the venture capital weed we were all smoking back then. Fear not, though, even if Fox makes a little less money this year, non-football fans will still have plenty of commercials to keep them interested. Headlining this year's line-up: General Motors' (NYSE: GM) Cadillac, Diageo's (NYSE: DEO) Taco Bell, and H&R Block cranking up a rendition of the Beatles' Taxman. Some dot-com survivors are back this year too: Online broker E*Trade (NYSE: ET), TMP Worldwide's (Nasdaq: TMPW) Monster.com, and Yahoo!'s (Nasdaq: YHOO) Hotjobs.com will all have spots. Last but not least, Britney Spears will be selling Pepsi (NYSE: PEP), because what would the Super Bowl be without Britney? Whether you're actually watching the game or just eating nachos for the camaraderie of it and viewing the commercials, we wish you a super Super Bowl Sunday. "I'll take Sam Donaldson to Block!" Want to play our Fool Radio game of Follywood Squares and talk with one of America's favorite journalists, Sam the Man? Do you have some pre-Valentine's Day advice you'd like to give on the subject of relationships and money? Got a financial question you want to ask? Fool Radio wants to hear from you. The Fool Radio phone lines are always open toll-free at 866-NPR-FOOL, 866-677-3665.
Priceline.com (Nasdaq: PCLN) and eBay (Nasdaq: EBAY) are teaming up to create a new travel booking service on eBay Travel. This represents a different business direction for Priceline, which will build the travel area and provide "airline, hotel, car, cruises, timeshares, and vacation packages." eBay, buoyed by research that shows 42% of eBay users purchased online travel in the last year, continues to extend itself into all areas of online commerce. Biopharmaceutical company Zymogenetics (Nasdaq: ZGEN) raised $120 million in its IPO yesterday. The 20-year-old specialist in therapeutic protein-based drugs was bought in 1998 by Danish drug maker Novo Nordisk (NYSE: NVO) and spun off two years later in a $150 million private placement. CEO Bruce Carter, whom we interviewed a year ago, said he was "pleased to enter the ranks of IPO companies," especially "in a rather unattractive financial climate." The company hoped to sell 10 million shares for $16-$18 a share, but the contagion from ImClone Systems (Nasdaq: IMCL) reduced that to a still-respectable $12. The proposed Hewlett-Packard (NYSE: HWP) - Compaq (NYSE: CPQ) merger passed European Union antitrust scrutiny yesterday.... Amgen (Nasdaq: AMGN) received FDA approval to launch Neulasta, a new version of its immunity-boosting drug Neupogen.... Microsoft hired one of the country's top computer security experts, suggesting Bill Gates was serious when he said security is now "more important than any other part of our work." As Enron Turns: In today's episode, titled "Good Things to Come Out of the Enron-Andersen Mess," four of the Big Five auditing firms, including Arthur Andersen, agree it's unsound to offer consulting services to the same firms they audit. The lone holdout is Deloitte & Touche. In a related move, Disney announces it will not be retaining auditor PricewaterhouseCoopers for additional consulting work. Meanwhile, President Bush announces he'll ask Congress to pass laws that will make it easier for employees to diversify their holdings in company pension plans.
Can the Super Bowl Predict the Market?
United Down, Travel Up
Who Moved Mickey Mouse's Cheese?
Discussion Board of the Day
Super Bowl Ads and Fads
Shameless Plug Dept: Fool Radio
Quick Takes
Super Bowl Avocado-Mango Salsa Recipe
Courtesy of epicurious.com.
1 ripe mango, peeled, seeded, diced
1 tomato, seeded, diced
2 green onions, finely sliced
1/4 cup fresh lime juice
1 jalapeño chili, minced
1 avocado, peeled, seeded, diced
Combine first 5 ingredients in bowl. (Can be made 3 hours ahead; refrigerate.)
Stir in diced avocado and season to taste with salt and pepper.
Makes about three cups.
And Finally...
Today on Fool.com: Bill Mann says something good can come out of the Enron scandal.... What do you do when you're selling a stock but don't have your original cost basis?.... TMF Taxes is talking about interest deduction for school loans.
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Brian Bauer, Bob Bobala, Robert Brokamp, Jeff Fischer, Tom Jacobs, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Dayana Yochim
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