My final “Fool Revisited” piece for today was the first article I wrote about the Dow Jones Industrial Average (^DJI). I definitely have a love/hate relationship with this particular index – it’s an arbitrary list of 30 companies picked by the folks in charge, weighted by price and not market cap – and it is talked about WAY TOO MUCH in the financial media when it passes certain big numbers. I wrote about when it went past 20,000 last February (it’s currently just a tad under 25,000) and it’s just a stupid measure if you care about what the “stock market” is.
The love part of the relationship comes from the fact that I was able to generate some content of this arbitrary list of companies. And this article was the first of many where the Fool tried to take advantage of “tickering” the index so that they got more page views. Not a bad idea, honestly, especially with the wide coverage that the Dow receives nearly every day in the financial press. Continue reading →
The next “Fool Revisited” piece this week is another earnings take, this time from former favorite stockUnder Armour (NYSE: UAA). At the time, Under Armour was still on the steepest part of its ascent as a company, having only recently just posted over $1 billion in revenue the previous year, a number that has grown to nearly $5 billion in the 6+ years since. However, as we will explore over the course of this series, what goes up must (eventually) come down, and Under Armour has been no exception.
The piece was nothing remarkable; these earnings takes were pretty cut and try and a quick way for the site to get some traffic surrounding the “favored” stocks when news was happening, especially when that news would drive performance one way of another of a stock that was recommended by one of the Fool services, as Under Armour was at the time. People want to know what’s happening and whether it might be a good time to sell at the top and get out or if things look like they are going to continue on. In October 2011, it seemed like the latter for Under Armour, though there were some warning signs that a decline may have been inevitable. Continue reading →
The next “Fool Revisited” piece this week is a companion piece to this one written on American Airlines. Whereas that article was hopeful for the company in advance of earnings, this article actually reported on those less than stellar earnings, which were really the beginning of the end for the last major American airline to declare bankruptcy – at least in that go around.
I’ll let you go read the article for all the details, but it was a pretty painful existence for the company leading up to its bankruptcy. As I’m sure I’ll cover in a future article or two, American Airlines’ fall from grace was not sudden, and they probably would have been better served joining the likes of Delta Airlines and United Airlines in bankruptcy years prior, but they were just too stubborn to do so. But when 14 of 16 quarters are showing a loss, it was definitely time to pack it in, and the airline finally declared Chapter 11 bankruptcy a month later, despite a rosy outlook (that probably wasn’t entirely warranted) at the time of its earnings announcement.
As an investor, the hope is to always identify companies that will continue to do what they well for an extended period of time. Many investors to the very end saw high revenues at American, with ticket sales and plane purchases hiding a lot of the problems that were actually affecting the performance of the business. This is why it’s important to look beyond those big headline numbers – “WIDGETS, INC. POSTS ELEVENTY BILLION IN REVENUE THIS QUARTER” – and look at the entire picture. Because often buried under those big headlines are the things that actually matter – “Widgets, Inc. just lost a huge lawsuit that will have a material effect on their business going forward and we will probably be going out of business within a year but REMEMBER THOSE ELEVENTY BILLIONS IN REVENUE!!!” Luckily, the market has become better at parsing this stuff out, but if you want to be an informed investor, you need to find these things out on your own.
Until next time…
Disclaimer: I do not own currently own shares in any of the mentioned companies, and I have no plans to purchase shares of either company within the next 60 days in any account in which I manage investment funds. You can read a little about my personal investment philosophy here.
The next “Fool Revisited” piece this week was inspired by a BlackBerry Limited (NYSE: BB) network outage. Remember that was a thing that mattered? Back when BlackBerry was called Research in Motion and they were considered the best at cell phone and security tech. It was truly an interesting time in our relatively recent history. At the time of article publication, BlackBerry was in third place among the use of mobile networks. Third place!! How times have changed. BlackBerry now gets lumped in with “Other” when discussing its mobile market share. Ouch!
I once owned a BlackBerry phone. I dropped the Android phone I had at the time and I needed a replacement. I didn’t want to get an iPhone, and it was too early in my personal replacement cycle to get another Android device for a reasonable price. Enter my BlackBerry Z10 that I had high hopes for, but I should have known I was going to be disappointed when I was able to get a refurbished version for less than $50. Let’s just say it didn’t go well – primarily because of a lack of apps and other fun things I had gotten used to – and it wasn’t long before I was back on an Android device. Continue reading →