Saying it "has no duty to warn people of fat, caloric content of commonly understood foods," McDonald's
Samuel Hirsch, the attorney for the plaintiffs, says Mickey D's has placed nutritional posters in out-of-the-way locations, making them hard to find. If his clients had been aware of the health dangers, he says, they "would have acted differently" and not eaten at the restaurant so much.
The judge did not indicate when he would make a decision.
The Motley Fool 50 followed all the major indexes up today, gaining more than 1%.
In today's Motley Fool Take:
- Hewlett Packs a Punch
- Quote of Note
- Cisco's Dividend Debate
- Boeing, Going, Gone
- Discussion Board of the Day: Boeing
- Play Credit Cop
- Quick Takes: Morgan Stanley, General Electric, Vivendi Universal, more
- And Finally...
Hewlett Packs a Punch
Though it's still too early to call it a success, Hewlett-Packard's
Earnings hit $0.13 a share, compared with a $0.17 loss on a combined company basis in last year's fiscal fourth quarter. Total revenue fell 1%, but was up 9% sequentially.
The big news thus far from the merger is the cost savings. CEO Carly Fiorina pointed to $651 million in permanent cost reductions in the past six months, 30% above targets. HP had cut 12,500 jobs as of the end of the quarter, also ahead of its goal of 10,000.
These results, combined with an affirmation of first-quarter earnings projections, are giving some hope to the PC sector. HP was up 15% in morning trading, the Goldman Sachs Hardware Index rose 6%, and the Philadelphia Semiconductor Index gained 7%.
Chief Financial Officer Bob Wayman did offer some words of caution about the holiday season, however, telling Reuters, "It's still not clear how strong the consumer market will be this year."
Still, the fourth-quarter results must be particularly pleasing to the CEO, who fought a bitter battle to get the acquisition some called "Fiorina's Folly" approved. "We are proud of our progress," she said. "We delivered solid results in a tough market. The HP team is executing, customers are responding and we're beginning to deliver on the promise of the merger. We feel good about our trajectory."
Fiorina has a right to be proud. Thus far, she receives high marks for her vision and execution.
Quote of Note
"When people talk, listen completely. Most people never listen." -- Ernest Hemingway
Cisco's Dividend Debate
So, Cisco faces a dilemma all of us wish we had -- how to spend $21 billion. The correct answer for a corporation is to put the cash where it generates the best return for shareholders. The correct answer for me is to buy a tropical island.
Right now, the best return for shareholders does not come from letting billions sit in a savings account. The huge cash holdings of tech giants like Cisco and Microsoft
So what are the alternatives?
1. Acquire smaller companies.
2. Reinvest in the company through capital expenditures and increased R&D.
3. Repurchase stock.
4. Pay out dividends.
Considering the acquisition binges of the '90s that these companies went on, they are probably leery of acquiring marginal businesses. With Cisco's excess capacity, it is unlikely capital expenditures would yield an acceptable return, and presumably R&D activities are fully funded.
So the debate really comes down to whether the company should buy back stock or pay out dividends to its shareholders. The two are not mutually exclusive, but do the shareholders benefit more from a buyback or a dividend?
A major stumbling block for the dividend crowd, of course, is the double taxation of dividends at the corporate and individual levels. Share buybacks delay taxation until the shareholders sell.
However, Cisco has shelled out massive amounts of stock option grants to the employees. So, if shares are repurchased and the price rises, the employees benefit much more than shareholders. Stock options don't pay dividends, so in the event of a dividend payout, the employees suffer (option prices decline as dividends increase). But the holders of common stock would receive cold cash. Although the tax penalty is real, the government still does not have a 100% bracket, so at least some of John Chambers' pocket change will rattle into your couch.
Finally, management needs to consider the company's stock price and probably reserve share buybacks for when the stock is undervalued.
Boeing, Going, Gone
So much for soft landings. Aerospace giant Boeing
That's where Boeing finds itself today, being pulled in two completely different directions. In terms of its commercial aircraft business, things couldn't get much worse. Since the events of 9/11, the major carriers have had to scale back. Travel, especially business-class and international trips, just isn't what it used to be.
Eliminating roughly 20% of their scheduled flights has translated into lower demand for new planes and a longer useable life for their existing fleet. Airlines like UAL's
For Boeing, that has meant holding back on 500 deliveries, or roughly the same number of jetliners it delivered just last year. Even worse, competitors such as Airbus have taken to drastic price cuts to win the little business that's out there to win.
Ironically, the same tragic events that have placed its commercial aircraft in a holding pattern have fueled a surge in military spending. While the company lost out to Lockheed Martin
But with projected commercial aircraft deliveries expected to fall to as low as just 275 jets next year, it's easy to see why Boeing can't keep its workforce intact in the near term. Let's just hope the displaced don't stray too far away. In a couple of years, the pent-up demand is going to swell nicely for Boeing. But are you patient enough to wait that long until the control tower clears you for takeoff?
Discussion Board of the Day: Boeing
When do you see a Boeing recovery? Can it bounce back without its commercial airline business returning? What is the competition doing right or wrong? All this and more -- in the Boeing discussion board. Only on Fool.com.
Play Credit Cop
You set your car alarm, insure your honey's handsome earning potential, and have a rider covering that Bicentennial quarter collection stashed in the lower left-hand drawer of the guest room dresser. So, how about a little protection for your good name and well-earned credit record?
There are plenty of products to guard your credit and keep identity thieves at bay. But we're fans of financial self-defense, as recently discussed on the Consumer Credit discussion board. Here are three protective measures you can put into action right now -- that is, after you're done reading the next 353 words.
1. Photocopy the contents of your wallet. Make a record of all your credit cards, driver's license, and insurance cards, and any other items that contain personal information and access to a line of credit, discount, or rewards. Xerox both the front and back of all cards, and then put the copies in a safe place. Should your wallet go missing, you'll have a record of its contents and quick access to the phone numbers you need to cancel your cards. When you get a sec, also photocopy your passport.
2. Write yourself a note on your check re-order form. If you still use old-fashioned checks, next time you replenish your supply, delete all personal information that isn't required. That includes your Social Security number, driver's license number, home phone, and favorite color. Sure, a thief can get access to all of this information should he be so inclined. But you might as well make him work for it.
3. Take your name off junk mail lists. It's easy to get the ball rolling, but it might take a while to see the effects of turning off the spigot. Pick up the phone and opt out of pre-approved credit card offers by calling 888-5OPTOUT (888-567-8688).
Slow the slew of catalogs, mailers, and dating-service spam your mother signed you up for by contacting the Direct Marketing Association and giving them your first, middle, and last names (including Jr., Sr., III, and "Bunny"), current address, and home area code and telephone number (for phone opt-out service). Send your info to both the Mail Preference Service at P.O. Box 643, Carmel, NY 10512 and the Telephone Preference Service at P.O. Box 1559, Carmel, NY 10512. Fewer solicitations in your mailbox and trash can mean fewer opportunities for a thief to get credit in your good name.
This list is not all-inclusive, but it should give you a little more peace of mind. Now, go refill your coffee mug and make a pit stop at the Xerox machine with your wallet. Should you find yourself a victim of identity theft, here's a rundown of what to do.
Shares of budget teen clothing retailer Debs Shops
No vay. Media giant Vivendi Universal
Today on Fool.com: Rex Moore tells you how to build wealth slowly by Dripping.... Rick Munarriz lists four ways to become a savvy holiday shopper.... Tom Jacobs says good company financial disclosure makes money.... Dayana Yochim teaches you how to play credit cop.... How to profit from someone's demise, in Fool's School.... Don't walk blind on your job hunt.... In Hot Topics, how far should you go to get the job you want?... Post of the Day: Foolish Collective.
Bob Bobala, Robert Brokamp, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Matt Richey, Jackie Ross, Reggie Santiago, Dayana Yochim