Finding Winning Stocks J ust Got Easier!
Leaderboard
TM
BY
Call 1. 1.800.83 800.831. 1.2525 2525o Investors.com/LB2 Take a complimentary two twoweek week trial trial. Ca orr go o to to Investo
THEBIG PICTU PICTURE RE Current outlook: Confirmeduptrend Stocksup Stocksup againas againas Bernanke Bernanke talks. talks. B2
S&P500INDEX 1680.91 +4.65 (+0.3%) Yahoo, DuPont amongbest gainers gainers
DOWJONES IND. 15,470.52 +18.67 (+0.1%) DuPont DuPont soars soars 5% on Pelzinvestment Pelzinvestment
NYSEVOL. (MIL) 3,091 +112 (+3.8%) Volume rises with little little price price progress progress
VOL. 30, NO. 71
NASDAQ 3610.00 +11.50 (+0.3%) Ambarella, Yandex makestrong moves
NASDAQ NASDA Q VOL. (MIL) 1,517 -23(-1.5%) Winners Winners edge losers by small margin
10-YEAR 10-YE AR T-NOTE 2.48% -0.05 (-2.0%) Bernanke Bernanke keeps markets markets on edge
EURO 1.3121 -0.0039(-0.3%) British British pound pound rises rises asBofEnixesQE
WWW.INVESTORS.COM
REUTERS REUTE RS CRBFUT. 287.96 -0.52 (-0.2%) Gold Gold falls1%; falls1%; oil upon supplydata supplydata
THURSDAY, JULY 18, 2013 $2.00
Stuck Stuck In Neutra Neutrall
He Sold Sold Motiva Motivatio tion n
3D System Systemss
ETFs Post-Berna Post-Bernanke nke
IBD Meetups Meetups
Has Ben Bernanke painted the economy into a corner?
Zig Ziglar boosted his career with upbeat books and talks
Its three-dimensional three-dimensional printers are no longer a niche product
Emerging markets jumped after the Fed chief’s update
Charlottesville, Va., investors get pumped up about analysis analysis
THENEW AM ER RII C A A 5
MU TUAL FUNDS & ETFs ETFs A6-9
THESM ART INVESTOR INVESTOR B1
ISSUES ISSUES & INSIGH TS A12-13 A12-13
LEADERS & SUCCESS A3
IBD’S TOP IBD’S TOP 10
EBay’s Q3 Outlook Raises Concerns Of Maturing Business
Fed Chief Eases Taper Fears
1 lowinflation lowinflation andtighter andtighter fiscal fiscal policy, policy,
Ben Bernanke stressed the risks of
addingto addingto earlierassura earlierassurancesthat ncesthat theFed won’t start tapering monetary stimulus until the economy is strong enough. A debt-ceiling fight and a weaker global economy could also hamper the U.S. recovery, he added. A jobless rate driven lowerby lowerby less less particip participatio ation n alsowillkeep benchmarkrates benchmarkrates low. Moreonthispage
Stocks Advance Modestly
2 and Nasdaq rose 0.3% and the Dow Tradingin Tradingin a tightrange,theS&P tightrange,theS&P 500
0.1%. Volume rose rose on the NYSE and fell ontheNasdaq ontheNasdaq.. IntheIBD50,a proxyfor proxyfor leading stocks, advancers led decliners by nearly 4-to-1. The 10-year Treasury yieldfell5 ticksto2.48% onFed chief chief Bernanke’s nanke’s commen comments ts and weak housing housing data. MoreonB2
EBay Guidance Sinks Shares
3 giant’sQ2EPSrose12.5%to63cents,
The The e-com e-comme merc rce e and payme payment ntss
meeting meeting views. It was smallest smallest gain in 2 years. Revenue Revenue rose 14% to $3.9 bil, just edgingforecasts. EBay issuedQ3 issuedQ3 EPS and revenue guidance below Wall St. forecasts, citing economic pressures in EuropeandKorea.EBaysharesfell6%in latetrading. Moreonthispage EBAY
Intel Misses, Warns On Sales
4 39centsashare,inlinewithQ2views Theworld’sNo. Theworld’sNo. 1 chipmak chipmaker er earned earned
but down 28% as consumers consumers continueto shiftawayfromPCs.Salesfell5%to$12.81 bil, below estimates. estimates. Intel , which has strugg struggledto ledto divers diversify ify fromPC chips, chips, cut its ’13 sales outlook to flat vs. ’12. It had seenlow single-digitgrowth. single-digitgrowth. MoreonA4 INTC
IBM EPS Improves, Not Sales
5 $3.91, beating views by 14 cents. But The tech titan’s Q2 EPS rose 3% to
revenuedip revenuedipped3% ped3% to$24.9bil,under to$24.9bil,under estimates,onadropinservicesandtechnology sales. sales. It was the 5th straigh straightt quarter quarter of declining sales. IBM raised its full year EPS outlook to $16.90 from $16.70. $16.70. Analysts expected expected $16.63. Shares edged higher. MoreonA4 IBM
Surprise Housing Starts Drop
6 pected pectedly ly cooled cooled to an annualiz annualized ed Construction on new homes unex-
paceof 836,000in 836,000in June, June, down down 10%from a month earlier and the slowest in 10 months.Theweaknesswasledbyasteep drop in volatile apartments, which also sent permits down. Mortgage application tion activ activit ity y fell fell by 2.6% 2.6% last last week week,, though purchases edged up, the MBA said. The 30-year fixed rate held steady ata2-yearhigh. SeeVitalSignsonA2
BofA EPS Tops As Costs Fall
7 share, up 68% vs. a year earlier and Bankof America America
BAC
earned32 earned32 cents cents a
beatingQ2 estimates estimates by 7 cents.Revenue rose rose 3%to $22.9 $22.9 bil, bil, slight slightly ly aboveviews aboveviews.. Thatcontinuesa trendof better-thanbetter-than-exexpectedresul pectedresults ts from from bigbanks.Noninterbigbanks.Noninterest expenses fell $1 bil vs. a year earlier, ledby lowerlitigationcosts.Mortgag lowerlitigationcosts.Mortgage e activity ramped up. Shares rose 3% to a 2-yearbest. Moreonthispage
St. Jude Up On Safety Hopes
8
The medical medical device device maker’s maker’s Q2 Q2 EPS rose rose 9% to 96 cents beating beating estimates. Sales edged down to $1.40 bil vs. $1.41 $1.41 bil a year earlier earlier,, but that also topped forecasts. forecasts. St. Jude Medical’s Medical’s key cardiac rhythm management business, including defibrillators and pacemakers, makers, showed signs of improvement, improvement, raisinghope raisinghopess thatsafetyconcer thatsafetyconcernsare nsare receding ceding.. Sharesrose5%to Sharesrose5%to a 2-yearhigh. 2-yearhigh. STJ
NRG Yield Jumps In Debut unitrose24%on its its firstday firstday oftradoftrad9 unitrose24%on NRG Energy’s Energy’s
NRG
alternative energy
ing to close at 27.25 after its 19.5 mil sharesprice sharespriced d at $22, $22, above above theproposed theproposed range of $19-$21. NRG Yield raised $430.65 mil in the offering. offering. The company will will buyand operatenatur operatenatural al gas, gas, solar solar and wind assets. It starts with a 30-cent dividend. NRG Yield was the first U.S. IPOinJuly. NYLD
Egypt: MB Protests Cabinet
10 hood members and supporters of Thousands Thousands of Muslim BrotherBrother-
ousted Pres. Mohamed Morsi protested in Cairo a day after interim Pres. Adly MansoursworeinaCabinetwithnot1Islamist lamist.. Mansoursaid Mansoursaid the Muslim Muslim BrothBrotherhood erhood and ultraco ultraconser nservat vative ive Nour Partyhad rejected rejected cabinetoffers.Sec’y of State John Kerry suggested the military couppreventeda civilwar.
Shares Fall 6% After Hours
size and growing competition competition coul could d lead lead to dece decele lera rati ting ng growth.” PayPal revenue up 20%, PayPal,eBay’sonline payments payments service,sawsalessurge20%vs.a but e-commerce giant $1.62billion. cites Europe, Korea woes yearearlierto EBay’s international international revenue revenue rose12% rose12% to $2 billi billion.U.S.rev on.U.S.reveeBY DO UG TSURU O KA nuejumped16%to nuejumped16%to $1.87 $1.87 billion billion.. IN VESTO R'S BU SIN ESS D AILY Revenue Revenue for eBay’s eBay’s Market Market-EBay’s second-quarter earnings places unit, including auctions, and sales were in line with ana- rose10%to$2billion. lystforecasts lystforecasts,, butsharessold off Gross merchandise volume — lateWednesd lateWednesday ay as thepayments thepayments thevalueof allgoodsand servic servic-and e-comme e-commerce rce giant giant issued issued es sold on eBay, excluding vehilight guidance, citing economic cles — rose 13% to $18.29 billion billion woesinEuropeandKorea. inQ2. Q2 earnings rose 12.5% to 63 Mature? cents a share, excluding items Too Mature? such as stock-based compensaS&P’s S&P’s Kessle Kesslerr says eBay retion.Thatmettheconsensusesti- mains mains a payment paymentss and e-come-commate of 39 analysts analysts polled polled by merce leader and has been very Thomson Thomson Reuters. Reuters. It was the good in terms of execution and smalles smallestgain tgain intwo years. years. innovation. EBay revenue climbed 14% But Kessle Kesslerr says he’s heard heard to $3.9billion, $3.9billion, justedgingviews more doubts in investment cirof$3.89billion. cles since eBay’s Q1 results on whethe whetherr the company“ company“ can sussusOverseas Pressure tain its record of favorable reTheSan Jose, Jose, Calif.-b Calif.-basedcomasedcom- sults and guidance.” One issue, panyseesadjustedper-shareprof- hesays, is if PayPal PayPal canmaintain canmaintain it in Q3 of 61 to 63 cents cents on reve- robust growth levels given re“Becauseourassetpurchasesdependoneconomicandfinancialde velopments, they are by no means on a preset course,” Federal Re- nue of $3.85 billion to $3.95 bil- centsigns of slowing. slowing. lion. Analysts had expected EPS “Therecould “Therecould besomechallengserveChairman Ben Bernankesaid Bernankesaid Wednesdayin Wednesdayin Washington Washington.. of65centsonsalesof$3.97billion. esand questi questionsthatthe onsthatthe compacompa“We expect continued macro- ny needs needs to addre address ss as past past economichead economichead winds winds in Europe Europe growth growth drivers drivers startto mature.” mature.” and Korea (in the second half). In this this context context,, Kessle Kesslerr sayshe Despitethat,westillexpecttode- want wantss to hear hear more more on how liverwithintherangeofourguid- eBay’sdoinginsomekeyinternaancefor thefullyear,”eBayCEO tionalmarke tionalmarketssuchas tssuchas Braziland Braziland John Donahoe said in a confer- Russia Russia and how that that will will impact impact ence call with analysts after the futurerevenue. Treasury Yields Drop Again resultswereissued. ChannelA ChannelAdvi dvisor, sor, a softwar software e Housing Start s Retr Retr eat Shares of eBay fell 6% in late maker that helps helps third-party third-party reAnnual rate, in millions That could offer relief as trading. During the regular ses- tailers sell on large e-commerce 1.2 sion, sion, sharesrose1% sharesrose1% to57.38,just websit websites, es, says eBay’s eBay’s averag average e housing starts fall hard, Total belowa long-termhigh. long-termhigh. same-store sales growth surged mortgage demand slows Analystswere mixedon eBay’s 18% in Q2, up from 15% average 0.9 prospects. growthinQ1. growthinQ1. BY JA SO N M A “Weremain “Weremain positiv positive e on (eBay) (eBay) RBC Capital Markets analyst I N V E S T O R 'S B U S I N E S S D A I L Y stock,”said stock,”said CantorFitzger CantorFitzgeraldanaldan- Mark Mahaney said in a July 14 0.6 Federal Reserve Chairman Ben alystYoussefSqua alystYoussefSqualiin liin a note. note. He pre-earnings report that he be blamed Q3 guidanceon softness softness lievesthat“eBay hasenough moBernank Bernanke e offered offered a more more dovish dovish spin spin onthe outlookfor outlookfor monetar monetary y inEurope. mentum in its current markets, Single-family starts 0.3 stimulus, stressing to Congress “EBay “EBay has been been perfor performing ming growth potential in those mar’08 ’09 ’10 ’11 ’12 ’13 Wednesdaytherisksfromlowinwell,”saidS&P well,”saidS&P CapitalIQequity CapitalIQequity kets, new investment initiatives Sources: Commerce Dept., Datastream flationand fiscalpolicy. analystScott Kessler.“However, Kessler.“However, in place, and execution compeSuch concern concernss could could extend extend webelievethe company’smaturcompany’smatur- tence tence to consist consistentl ently y delive deliverr the timeline for Fed bond pur- of the last 10 weeks, though last ing (business) categories, large high-teensEPS high-teensEPS growth.” growth.” chases, which are seen slowing week saw a slight uptick in purthis this yearandendingin mid-20 mid-2014 14 chases, according to the Mortif theeconomy keepsimproving. gageBankersAssociation. While While Bernanke Bernanke reiterat reiterated ed that Builder Builderss in Junebroke ground ground quantitat quantitative ive easing’s easing’s path de- onnewhomesattheslowestpace pends on economic data, he ele- in10 months months,, theCommerc theCommerceDeeDe vated vated price stability stability risks, pointpoint- partment said. Bernanke noted ing out that low inflation raises the pullback but cautioned it’s theoddsofdeflationaswellasthe tooearlyto sayif higherratesare higherratesare Shares Rise To 2-Year High BofA cut loan loss provisions realcostofcapitalinvestment. havingan economic economic impact. by $1.2 billionas net charge-offs charge-offs He also said fiscal tightening Ifratesthreatenthe housing housing rehitlowsnotseensince2006. couldweighoneconomicgrowth bound, however, however, the Fed would B Y M A R I L Y N A L V A “This “This has been a consist consistent ent more than anticipated, a starker “takeadditionalaction,” he said. I N V E S T O R ' S B U S I N E S S D A I L Y them theme e acro across ss the the (bank (banking ing)) warning vs. his June statement Such Such promis promises es have have helped helped Bank of America beat secondspace thus far in 2Q13 earnings that that fiscal fiscal policychange policychanges’full s’full ef- pull global markets back from quarter earnings and revenue revenue season,”wrote season,”wrote analystPaulMillfect fect hasn’tplayedoutyet. hasn’tplayedoutyet. forecast astss andcut what what hasbeen lastmonth’ssteepsell-off,as lastmonth’ssteepsell-of f,as Ber- forec erofFBRCapitalinanote. nanke and other policymakers policymakers persistentlyhigh expenses,sendJPMorgan , Wells Wells Fargo Fargo , Bernanke Bernanke Stresses Stresses Downside Downside shares to a two-yea two-yearr high high tryto convinceinve convinceinvestor storss theFed ing shares Citigroup and GoldmanSachs A debtceilingbattle debtceilingbattle thisfalland won’t won’t scale scale back back stimulusunles stimulusunlesss Wednesday. alsohave topped topped estima estimates tes over over weaker-than-ex weaker-than-expected pected global theeconomy is strongenough. The banking giant earned 32 thepast week.Morgan Stanley growth could throw off the U.S. “I think think market marketss are beginni beginning ng cents a share, up 68% vs. a year reports reports Thursday. Thursday. economicrecoverytoo,headded. to understand our message, and earlierand earlierand 7 cents cents above above analyst analyst ThoughBofA had curbedmak“He definit definitely ely brings brings out more more the volatility volatility has moderated,”he moderated,”he estimates. Revenue rose 3% to ing mortgage loans in the wake of the downsi downside de risks, risks,”” saidTim saidWednesday. $22.9billion,slightly beating. beating. of huge Countrywide losses, it’s Duy, Duy, a Univers Universityof ityof OregonecoOregonecoBankof Americ America a sharesrose stepping up activity. It funded AfterSeptember nomicsprofessor. nomicsprofessor. nearly nearly 3% to 14.31,the 14.31,the best best since since $26.7 billion in home loans, up U.S.stockindexesrose modestmodestBernanke continued to stress March2011. 41% 41% from from last last year year and and 7% from from ly. The 10-year Treasury yield that benchmark rates will stay That was in stark contrast to Q1evenas interes interestt ratesrose ratesrose fell fell 5 basis basis points points to 2.48%, 2.48%, con- low, low, even even after after QE ends. ends. He Q1 results, which missed on the Thenumberof Thenumberof 60-dayor 60-dayor more more tinuingto tinuingto retrea retreatt fromtheJuly5 bottomlinesand caused caused added more wiggle room to the topand bottomlinesand delinquent delinquent loans it served fell spiketoa23-monthhigh. sharesto fallsharply. Fed’s6.5%unemploymentthresh26%fromtheendof 26%fromtheendof Q1and54% TheFed’sbeigebookreportt on oldforkeepingratesnearzer TheFed’sbeigebookrepor “At the beginning of the year oldforkeepingratesnearzero. o. fromlast year’ssame period. period. Wednesday found an economy wouldfocuson three three If lower labor force participa- wesaidwe wouldfocuson Management Management stressed that it that is still expanding at a mod- tion accounts for a substanti things gs:: reve revenu nue e stab stabil ilit ity, y, substantial al thin continue continued d to build build capital capital ratios ratios esttomoderatepace. strengthening the balance sheet chunk chunk of an improv improveme ement nt to strengthening despitehigher rates’negative imIn his testimony to the House 6.5%, then the Fed is unlikely to and managing costs,” said CFO pactonits bondportfoli bondportfolio. o. Financial Services Services Committee, Committee, raiserates. raiserates. Persiste Persistentlylow ntlylow inflainfla- Bruce Thompson. “This quar Analysts have grilled grilled banks the Fed chief also emphasized tionalsowoulddiscourageahike. ter, ter, wedelivere wedelivered d onall three. three.”” about their ability to meet new that that thecentralbank thecentralbank iswatching iswatching Net interest margin ticked up Bernanke’s comments pushed regulat regulatory ory rules rules for capital. capital. closelyhow closelyhow much much financia financiall con- back some views on when the to 2.44% from 2.43% in Q1 and BofA is considered better posiditions tighten. Last week, Ber- Fedwill begin begin to trim trim QE.“They 2.21%inQ22012. tionedthan itspeers. nanke nanke said said the the Fed Fed would“pu would“push sh leaveme Noninterest Noninterest expenses fell $1 leaveme lessconf lessconfid identof entof a SepSepBofA said it continued to im back”if theytightentoo much. billionfrom a yearago to $16 biltember tember tapering,” tapering,” Duysaid. prove prove itsBasel IIIcapital IIIcapital standstandMortgage Mortgage rates have shot up thebank’s litigat litigation,lega ion,lega-Economi Economic c data also doesn’t doesn’t lionas thebank’s ings,wit ings,with h a 9.6%Tier1 9.6%Tier1 ratioand ratioand since since thefirst hints hints of QE tapertaper- seem seem strongenoug strongenough h tojustifyta- cy assets and servicing and pernoted that it is close to meeting ingin May.Theyareat May.Theyareat two-y two-yea earr peringby peringby then, then, especial especially ly recent recent sonnelexpensesdeclined. supplem supplementa entary ry hurdles hurdles prohighs,butpullin highs,butpulling g backthisweek signs gross domestic product is Expenses related to servicing posed posed by U.S. U.S. regulat regulators ors that withTreasuryyields.Home loan growing delinquent mortgage mortgage loans from growing weaker than predicted, predicted, delinquent wouldtakeeffectin2018. wouldtakeeffectin2018. applica applicatio tions ns have fallen fallen for nine said its illill-fa fate ted d acqu acquis isit itio ion n of said Juli Julia a Coro Coronad nado, o, Nort North h its Commercial loans and leases subprime lender Countrywide Countrywide America America chief economist economist at BNP subprime increase increased d by$10 billioninQ2. billioninQ2. fellfaster thanexpected. Paribas,in a researchnote. researchnote. Global wealth and investment Litigationcostsfellto$471mil“A data-dependent Fed surely management management income leapt 38% will will nottaperin Septem September ber,”she ,”she lion from $2.2 billion in Q1 and vs.last yearto $758million. Rev$963milliona $963milliona yearearlier yearearlier.. wrote. enuerose10%to$4.5billion. EBAY
Fed’s Bernanke Is Dovish On Plans For QE Tapering
BofA’s Q2 Earnings Soar 68% As Mortgages Revive, Costs Fall
JPM
C
WFC
GS
MS
BAC
