Finally, some explanation as to why women only make 70 cents for every dollar men make: According to a recent poll, men spend 62% more on Valentine's Day gifts than women. What a relief, guys. You can stop harboring all that guilt now. (Yes, we're being sarcastic.)
Our Valentine's Day Fool Extravaganza is in full swing. We've got Valentines From Hell, Stocks Fools Love, and plenty of helpful money-saving tips for those looking for love. And the markets are closed on Monday, so spend your three-day weekend here, catching up on all your favorite features. The Motley Fool Take will be back on Tuesday.
In today's Motley Fool Take:
- Dell Delivers
- Discussion Board of the Day: Dell Computer
- America Gets More Foolish
- Quote of Note
- Krispy Kreme's Sweet Success
- Shameless Plug: Help With Taxes and More
- Fool Around Town: McLean, Va.
- Quick Takes: Consumer sentiment index, Hans Blix, rising gas prices, more
- And Finally...
It's hard to call Dell
With fourth-quarter earnings climbing from $0.17 to $0.23 a share and the company confident that unit shipments will grow at a 25% clip in the current quarter, it makes one wonder if Dell is even in the same league as its troubled rivals.
Sure, the Dell dude got arrested last Sunday, but Dell itself is the one getting away with the ultimate crime of stealing market share. With ease, the company has also expanded into new product lines such as servers, laptops, and eventually printers.
Margins continue to fatten as the 32% in profit growth outpaced the 21% spike in revenue. Sales totaled $9.7 billion in sales for the quarter. Make no mistake about the fact that Dell can't continue to grow in perpetuity if the sector doesn't bounce back. You can continue to carve bigger slices of a shrinking pie until you've eventually consumed the whole pie. Then what? Dell would be the first to welcome a healthy revival among the box makers. But it feels good for now. Michael Dell knows better than to spring a Valentine's Day massacre on shareholders.
Discussion Board of the Day: Dell Computer
Is Dell setting shareholders up for a broken heart or is it the real deal? Where does the company go from here? All this and more -- in the Dell Computer Discussion Board. Only on Fool.com.
America Gets More Foolish
Pardon us while we let out a giant "Whooopeeee!" A recent story in The Wall Street Journal contains the following golden sentence: "After running up giant credit-card balances and going deeper into hock for the past decade, there are signs that American consumers are starting to curtail their credit-card borrowing and pay down some debts."
We are particularly happy to hear that, because such actions are a cornerstone of our Foolish investing philosophy. It's right there, in Step 2 of The 13 Steps to Investing Foolishly: "Your personal finances need to be in squeaky clean order before you ever think of placing that exciting first stock trade."
Getting your financial house in order involves three things:
- Erasing credit card debt
- Setting up (and sticking to) a regular savings plan
- Accumulating an emergency cash stash
According to the Journal story, outstanding credit card debt fell a sharp $8.4 billion in December, the largest monthly decline since record keeping began in 1968. Meanwhile, the savings rate has risen significantly -- consumers stashed away 4.3% of their income in the fourth quarter of last year. The prior-year savings rate was less than 1%.
One final, important, optimistic note. Americans are being smarter with cash they've received from refinancing their homes. Loan giant Freddie Mac
Good job, America... keep it up! If you need more help, be sure to visit our Credit Center, where you'll discover some long-hidden secrets of the lending industry and learn how to get out of debt and manage a credit card properly.
Quote of Note
"Borrowers are a lot more savvy than we're giving them credit for." -- Amy Crews, deputy chief economist for Freddie Mac, in The Wall Street Journal
Krispy Kreme's Sweet Success
There may be nothing as perfect as one of Krispy Kreme's
OK, perhaps we exaggerate a bit, but just look at the company's fourth-quarter comp sales if you don't believe us. Lots of folks are munching down on some Original Glazed love, and Krispy Kreme's growing fatter for it. (Some of those munchers undoubtedly are, also, but we digress.)
Same-store sales for the quarter ended Feb. 2 rose 11.8%. That's pretty sweet. Krispy Kreme didn't release total sales today, but one can bet based on these comps that they'll be impressive. It will give the full fourth-quarter rundown on March 18.
Krispy Kreme also said it's comfortable with the 2003 fiscal year estimate of $0.65 a share. That represents 44% earnings growth over last year. The company announced it expects to grow earnings for 2004 by 35% to $0.88 a share, ahead of existing estimates by $0.04.
Spreading its tasty temptations around, Krispy Kreme opened 28 new stores in six new markets during the quarter. For all of 2003, it enticed customers with 63 new stores and three new doughnut and coffee shops. It will open even more in fiscal 2004, adding 77 new locations in 17 new markets.
Shares have come down over the last year like a kid from a sugar high. They touched a new 52-week low on Monday, but are up 10% today to $31. That means the stock is now trading at a forward P/E of around 35, matching its expected earnings growth for the year. While still not the sweetest bargain around, shares are much more reasonably priced today than for much of 2001, when they traded at a P/E over 100.
Shameless Plug: Help With Taxes and More
With only two months left till tax D-Day, do you wish you could just pick up the phone and call a financial planner for some advice? With our TMF Money Advisor service, you can. Among many other benefits, you'll be able to speak to an unbiased pro about everything from taxes to portfolio management to insurance. Sign up now for your 30-day free trial!
Fool Around Town: McLean, Va.
Join Fool Senior Editor Bill Mann as a guest of The Baltimore Washington Venture Group and the Dingman Center for Entrepreneurship to discuss "Survival Tips and Trends 2003: Best Practices for Businesses Building to Last," Tuesday, Feb. 18, 7:30 a.m. to 9:30 a.m., at the Tysons Corner Hilton in McLean, Va. For more information and to make reservations, click here.
Ah, it's that time of the month again... time to trot out the University of Michigan's consumer sentiment index. This time it says that the threat of war, possible terrorist attacks, and the ailing economy have driven our confidence to a nine-year low. Feh.
On a related note, the most-watched man in the world delivered the crucial news today. Chief inspector Hans Blix gave a rather mixed report to the United Nations Security Council, saying his team has not found weapons of mass destruction in Iraq, but that Saddam Hussein was still not cooperating and accounting for other suspected banned weapons. The report was perceived as slowing down a bit the rush to war, and global markets rallied accordingly.
Perhaps Blix can nix rising gas prices with his report. A gallon of petro has soared above $2 in over two dozen urban areas, reaching $2.29 in San Francisco. A spokesman for AAA says the prices are "uncomfortably close" to gouging.
Fears of biological or chemical attacks are causing a run on duct tape. Seriously. Manufacturers have stepped up production after the government suggested that the humble, sticky stuff can be used to seal windows and cracks. USA Today says Manco -- which supplies Wal-Mart
The Waffling Headline of the Day Award goes to this one from the Associated Press: "Possible U.S. Economic Rebound Predicted."
Today on Fool.com:
- For updated stories throughout the day, bookmark our ever-changing News section.
- Valentines From Hell: If ever there was a Hallmark moment, it's now -- in the midst of terror threats and a run on duct tape.
- No Love for CNN and ABC: AOL Time Warner nixes a marriage between the two news divisions.
- Power Generators Produce: Despite analyst downgrades, generators are shining a little brighter.
- In our Tax Center, is that stock in a bankrupt company "worthless" in the eyes of the IRS?
- In Fool's School, how does investing in stocks put money in your pocket?
Bob Bobala, Robert Brokamp, Jeff Fischer, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Matt Richey, Jackie Ross, Reggie Santiago, Dayana Yochim