The week started with a rumor, but earnings and new product launches grounded it in reality.
Meg goes on a Shopping.com spree
I don't think Meg Whitman is channeling Yoda. However, eBay (NASDAQ:EBAY) has made a habit of scooping up young dot-com Jedi warriors -- you know, any company that's building its own virtual Death Star to wreak havoc on the eBay Federation -- before they turn to the dark side. The online auctioneer bought Half.com when that company's consumer-to-consumer model threatened its livelihood. It snagged PayPal when its own online payment service couldn't muster a victory. And now it's acquiring Shopping.com (NASDAQ:SHOP) in a $620 million deal.
It's not just the domain that eBay was after, even though some of the common-word dot-coms that the company has gobbled up, like Half.com and Rent.com, could make you think otherwise. In this case, though, Shopping.com was starting to matter. Through the merger between DealTime, its previous comparison-shopping incarnation, and Epinions, the consumer-opinion site, Shopping.com offered the best of both companies. In short, it had become a platform for small merchants to get noticed. So when eBay board member C-3PO muttered, "I have a bad feeling about this," the world's leading online marketplace decided to tap its massive cash reserves to acquire the upstart before it was too late.
So they finally gathered up some dynamite, blew up the hatch, and then .
Even though Lost ended with a mountain range full of cliffhangers and Desperate Housewives left its viewers with more split ends than a bad hair day, there was little doubt about where ABC was going -- to the bank. Disney's (NYSE:DIS) broadcasting network saw its upfront ad sales spike by 30% for the upcoming fall season after a huge turnaround at its once troubled network.
No, it wasn't much of a surprise. ABC has been gaining viewers, mostly at the expense of General Electric's (NYSE:GE) NBC. While sponsors also buy ad time during the actual season, this upfront season is intriguing -- it's when advertisers do a little gambling by buying up commercial spots for the next season. As you can imagine, ABC at this time last year was a bit of a laughingstock in the ratings, so it didn't have much of an upfront selling season. Now, ABC matters. Meg? Fire up the light saber.
Brokers can be had, for a price
Discount brokers are a lot like hormonal teens. They like to dance. They like to talk about their conquests. They also like to date. Ameritrade (NYSE:AMTD) has been the belle of the ball these days. First it was E*Trade (NYSE:ET) offering an unsolicited buyout offer last month. Ameritrade balked. Now Ameritrade itself is on the prowl, with its eyes set on TD Waterhouse, the rival discount broker owned by Toronto-Dominion Bank (NYSE:TD).
Consolidation in the discount-brokerage space can be good and bad. Although combined companies can improve their operating efficiencies and drive costs lower, it can also mean that fewer choices will leave the remaining companies less likely to enter into pricing wars to make trades cheaper for you.
But wait a minute. If merged companies can operate on better margins and at the same time achieve more pricing flexibility, can't the individual investor still win? Yes, of course. There is one way -- buy the discount-brokerage stocks. If you don't have that luxury, well, Meg may be waiting in the wings.
The headlines behind this week's stories:
Until next week, I remain,
Longtime Fool contributor Rick Munarriz enjoys a good cliffhanger almost as much as, well, he'll tell you next week. He does own shares in Disney. The Foo l has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
