BloggingStocks

How Growth Destroyed Brand Value at Starbucks
Founder and CEO Howard Schultz had a great concept, and it worked for a while. But too many new stores and diverse products changed the experience.
Starbucks: How Growth Destroyed Brand Value - BusinessWeek

How to Make the Most of Your Trip to a Warehouse Club (and Spend the Least)
Here are five ways to whip inflation when you shop at Costco or one of the other warehouse clubs. You won't save much money if you get sidetracked by the bling and the flat-screen TVs. Here is how to really shop at one of these clubs.
Five Ways to Whip Inflation When You Shop at a Warehouse Club - Kiplinger.com

6 Ways to Downsize for Retirement
In a nation obsessed with everything "biggie-sized," the thought of downsizing holds as much appeal as a root canal. At best, downsizing is sometimes undesirable; at worst, it suggests failure. But it can be a smart move. Consider these tips to trim the fat from your budget and boost your bottom line.
Ways to downsize during retirement - Bankrate.com

The JetBlue of Hotels
Starwood Hotels & Resorts asked architect David Rockwell to help it develop some fresh ideas, and Aloft Hotels, debuting this summer, is the result. Starwood plans to open 72 Alofts by the end of 2009 and ultimately 500 worldwide.
The JetBlue of Hotels | Fast Company

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BusinessWeek: Be wary of stocks under $10

Eliza Popescu — 2008-07-02T15:45:00+00:00

Filed under: Forecasts, Consumer experience, Competitive strategy, Apple Inc (AAPL), Ford Motor (F), Motorola (MOT), Research in Motion (RIMM), Washington Mutual (WM), Economic data, JetBlue Airways (JBLU)

The weak market conditions have caused many stock prices to fall under $10. Not only smaller -- and perhaps lesser known -- stocks trade under $10 these days, but also some big and famous names such as Ford Motor Co. (NYSE: F), Motorola Inc. (NYSE: MOT), Sprint Nextel Corp. (NYSE: S), Washington Mutual Inc. (NYSE: WM) and Del Monte Foods (NYSE: DLM), as well as many airline companies like Northwest Airlines (NYSE: NWA) and JetBlue (NASDAQ: JBLU).

While those names could sound tempting for investors who may think they are cheap, BusinessWeek's Karyn McCormack reminds us that not everything that is cheap is a good bargain, and there are some risks that need to be taken into account.

One common problem for most of these stocks is that they trade under $10 for a reason. That reason is usually hardly any earnings growth, if any at all. And with a weak economy, these companies would have an even harder time to stimulate growth. Add to the mix the fact that institutional investors don't like to touch stocks under $10 and the potential for recovery is not good.

In addition, for companies like Ford and Motorola, the problems compound as they find it difficult to address changing customer demands and needs. After they each focused on one business model such as Ford's focus on sport-utility vehicles and trucks and Motorola's focus on the RAZR wireless handset, they both have lost considerable market share to competitors as they have both failed to respond to changing demands.

But there are still some hopes for these stocks. If we take a look in the past, even Apple Inc. (NASDAQ: AAPL) was under $10 in the summer of 2003 and is currently trading over $170, while Research in Motion Ltd. (NASDAQ: RIMM) dropped under $10 between 2001 to 2003, and now trades for $118.

As a last piece of advice, the article reminds us that there is always a reason for single-digit stocks to be priced at such a low level and it is not something that should pass unobserved for investors. With so much turmoil in the market, it may not be the wisest move to add smaller, riskier stocks.

Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.

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Newspaper wrap-up: NBC, British private equity firm expected to buy German games site

Laurie Pasternack — 2008-06-09T08:10:00+00:00

Filed under: Newspapers, Magazines, General Electric (GE), Verizon Communications (VZ), Barclays plc ADS (BCS), JetBlue Airways (JBLU), Lehman Br Holdings (LEH)

MAJOR PAPERS:

The LiveTV unit of JetBlue Airways Corporation (NASDAQ: JBLU) is buying Verizon Communications Inc's (NYSE: VZ) Airfone network, the Wall Street Journal reported.
As Lehman Brothers Holdings Inc (NYSE: LEH) is about to report a second quarter loss of about $2B, the firm is closing in on raising over $5B in new capital, the Wall Street Journal reported. Once source of Lehman's new funding is reportedly the New Jersey Division of Investment.
The Financial Times reported that General Electric Company's (NYSE: GE) NBC Universal and British private equity firm GMT Communications Partners are expected to soon acquire Bigpoint, a German-based computer games website.

OTHER PAPERS:

According to the Independent, the credit crunch has cost the jobs of about 100 bankers at Barclays Plc (NYSE: BCS). The bank cut about 20 individuals on the leveraged finance team and will reportedly cut 80 more in investment banking and IT support.

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Closing Bell: S&P survives day-end selling

Jon Ogg — 2008-05-30T16:35:00+00:00

Filed under: Dell (DELL), Anheuser-Busch Cos (BUD), Marvell Technology Group (MRVL), JetBlue Airways (JBLU)

A mixed day in many stocks, though this actually worked out to be an acceptable day despite the end of day selling that took away many of the gains. To show how the markets were mixed continually, the S&P 500 Index closed up marginally for May while the DJIA closed slightly down for the month. We also saw income and spending fall, although the numbers weren't quite as bad as expectations. This was also when the University of Michigan gave the crummiest reading in 28 years. Here are the unofficial closing bell levels:

DJIA 12,619.92 (-26.30)
S&P500 1,398.97 (+0.92)
NASDAQ 2,522.66 (+14.34)
52-WEEK LOWS
Top 10 Analyst Calls
Oil & Gas Upgrades/Downgrades

Anheuser-Busch Companies Inc. (NYSE: BUD) saw highly unusual options activity and strong equity trading as more speculators believe a deal with Belgium's InBev may be imminent. Shares rose almost 2% and were up at $57.58 in the final minutes of the day.

Dell Inc. (NASDAQ: DELL) beat the skeptics and beat earnings last night in a move that sent shares higher. In the final minutes of trading, shares were up almost 7% at $23.28 in the final minutes.

J. Crew Inc. (NYSE: JCG) saw a sharp drop on high volume after the company beat earnings but lowered estimates ahead. Shares were down almost 20% at $37.74 in the final minutes of the day.

JetBlue (NASDAQ: JBLU) saw added pressure today and the stock even challenged its 52-week lows after it priced $175 million in 30-7ear convertible debentures. Shares were down 4% at $3.98 in the final minutes of the day.

Marvell Tech (NASDAQ: MRVL) saw a surge of 25% to $17.67 by the final minutes of the day after the company beat earnings in part due to its iPhone ties.

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Top transportation stocks, car repo rates soaring & 12 most thriving cities - Today in Money 5/28

Allan Halprin — 2008-05-28T08:48:00+00:00

Filed under: Microsoft (MSFT), Yahoo! (YHOO), General Electric (GE), Exxon Mobil (XOM), Sony Corp ADR (SNE), Money and Finance Today, United Parcel'B' (UPS), US Airways Group (LCC), UAL Corp (UAUA), JetBlue Airways (JBLU), Burlington Northern Santa Fe (BNI)

In the News:

· Durable Goods Orders Fall Less-Than-Expected 0.5% in April

· As Gas Prices Surge, Americans Reduce Driving By Largest Amount Ever

· JetBlue Plans to Significantly Slow Growth; Delays Plane Order

· Consumer Confidence Hits 16-Year Low

· GE Eyes World's Next Big Worry: Water

· Soaring Gas Prices May Have Peaked Over Memorial Day Weekend

· Housing Issues Scarier Than High Oil Prices

· Microsoft-Yahoo Deal Imminent?

· Exxon Mobil Braces For Showdown With Rockefellers

· United-U.S. Air Talks Appear to Have Fallen Apart

· Sony Sees End to Cable Boxes

· Home Prices Post Sharpest Decline in 2 Decades

· BMW Tops Annual Automotive Quality Survey

· Who Is Getting Rich From Soaring Food Prices?

5 Transportation Stocks Ready to Roll
These five transportation stocks poised to ride out the domestic doldrums. They include JB Hunt, UPS, Burlington Northern Santa Fe, DryShips and Expeditors Int'l of Washington.
Five Transportation Stocks Ready to Roll - SmartMoney

Making a Good Living, But Still Feeling Strapped
Consumers are feeling worse about their personal finances and prospects - far worse than government statistics about the economy would indicate.
Making a good living, but still feeling strapped - CNNmoney

You Think Flying Is Bad Now...
Something has to give as airlines adjust to $130 oil and brace for a record yearly loss. Not all of the majors will survive. Analysts say liquidations could well leave an industry consisting of two dominant carriers, most likely the combined Delta-Northwest and perhaps a combined American-Continental, along with a couple of discount players like Southwest. This consolidation will come with a cost: That means fewer routes, fewer flights, and even more crowded planes. The era of cheap fares will end, too. Prices will rise, and airlines will become even more creative in how they set fares. Airlines will take other steps to wring more cash out of passengers.
You Think Flying Is Bad Now.. - BusinessWeek

Getting Squeezed By Credit Card Companies
Card issuers use all sorts of tactics to wrestle every penny out of customers. Here's what you need to know.
Drowning in debt: Deceptive credit card practices - CNNmoney

Car Repo Rates Are Soaring
It's not just homes that are being taken away these days -- cars are also being repossessed at startling rates. Last year over a million cars were hauled away by repo men, and '08 could be worse. But could it benefit you?
Car repo rates are soaring -Bankrate.com

12 Most-Thriving Cities in the World
You can see it in their stats and in their cityscapes: These 12 Fast Cities around the globe are thriving. Expect to see big things in the coming years from Beijing, Hyderabad, Mexico City, Seattle, Orlando, Kigali, Calgary, Kansas City, Barcelona, Moscow, Doha and Abu Dhabi.
Best Cities for Innovation | Fast Company Interactive Map: 12 Cities on the Verge

20 Hottest Young Royals
They're all young, rich and famous. But who's got the most international influence? Prince William and Prince Harry of England top the list followed by Princess Anne's daughter Zara Phillips, Prince Andrew and Fergie's daughter, Princess Beatrice and Grace Kelly's granddaughter Charlotte Casiraghi.
The 20 Hottest Young Royals - Forbes.com In Pictures: Hottest Royals

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Pre-market movers (UAUA) (LCC) (JBLU)

Douglas McIntyre — 2008-05-28T07:52:00+00:00

Filed under: Before the bell, US Airways Group (LCC), UAL Corp (UAUA), JetBlue Airways (JBLU)

United (NASDAQ: UAUA) is up 4% on news that the company is backing off merger talks with US Air (NYSE: LCC), which is up 3%.

JetBlue (NASDAQ:JBLU) is off 5% on news that it will delay delivery of new planes and raise money.

Shanda Interactive (NASDAQ:SNDA) is off 2% on weaker than expected earnings.

Stocks may trade differently in the pre-market than they do in the regular session.

Douglas A. McIntryre is an editor at 247wallst.com.

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Before the bell: Futures higher as oil drops further

Melly Alazraki — 2008-05-28T07:44:00+00:00

Filed under: Before the bell, Earnings reports, Deals, Employees, Market matters, US Airways Group (LCC), AMR Corp (AMR), UAL Corp (UAUA), Economic data, JetBlue Airways (JBLU), Oil

Stock futures were higher early Wednesday morning as oil and other commodities declined, providing some relief.

U.S. stocks ended higher Tuesday, especially the tech heavy Nasdaq composite which rose 36 points, or a solid 1.5%. The Dow industrials and the broader measure S&P 500, rose 68 points, or 0.55%, and 9 points, or 0.68% respectively. A dramatic retreat in crude of more than $3 a barrel helped boost sentiment.

On the economic docket today is April durable goods order, which economists are expecting to show a further decline. The report is due to release at 8:30 a.m. EDT.

Weekly crude inventories, usually released Wednesdays, will be postponed due to the shortened week. Meanwhile, though, oil prices continued to decline, dropping below $127 a barrel Wednesday in Asia, extending the previous session's decline. It seems that the higher prices cut demand, which in turn, pressured prices back.

On the corporate side of things, Borders (NYSE: BGP) said its losses narrowed in the first quarter to $31.7 million, or 53 cents per share, although its same-store sales fell. The results were below estimates of a loss of 47 cents per share. The relaunch of the bookseller's retail Web site Tuesday didn't impress Wall Street much either and shares dropped 7%. There was continued pressure on the shares in after-hours trading.

Shares of airlines may also be in the spotlight Wednesday, after JetBlue Airways Corp. (NASDAQ: JBLU) said it will delay buying 21 new Airbus jetliners 4-5 years from because of rising fuel costs. JBLU shares were down some 4.7% in after-hours trading.

Meanwhile, AMR Corp. (NYSE: AMR)'s American Airlines, also faced with soaring fuel prices, said it has rejected its pilot union's contract proposals because the cost is too high. The union now wants to know if talks are at an impasse. The airline also detailed the first round of cuts. AMR shares, however, are 2% higher in premarket trading.

Similarly, merger talks between UAL Corp. (NYSE: UAUA)'s United Airlines and US Airways (NYSE: LCC) appear to have slowed and perhaps even fallen apart, according to the New York Times. Shares of both are higher.

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Will short squeeze send JetBlue soaring?

Aaron Katsman — 2008-05-27T18:08:00+00:00

Filed under: Consumer experience, Personal finance, JetBlue Airways (JBLU), Oil

With surging crude oil prices, and a slower economy, airline stocks don't rank high on investor wish lists. You don't hear colleagues standing around the water cooler singing the praises of the airlines. So what would make a sane investor contemplate purchasing an airline stock? I am not sure myself but if you take a long look at JetBlue Airways Corporation (NASDAQ: JBLU), you may feel like throwing the dice.

Mark Kreiger at SeekingAlpha.com has a really good analysis of why JetBlue stock is compelling. He says, " The airlines are responding to the fuel crises by doing all the right things such as utilizing fuel hedging programs, initiating capacity reductions and reducing overall costs."

Kreiger singles out JetBlue because their Q1'08 report soundly beat analyst estimates. The company has $1 billion in cash and has a book value of $6. Well above the approximately $4.50 price per share. More interesting is a potential short squeeze setting up on the stock. Kreiger analyzes this further at the site, and it's worth a close read.

If you believe that at some point crude prices will drop, and you are looking for a way to play that drop, you potentially may want to do some research on JetBlue.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 5/27/08.

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Military couple are millioniares in making, more trouble ahead for fliers & incredible parking garages - Today in Money 5/23

Allan Halprin — 2008-05-23T08:45:00+00:00

Filed under: Yahoo! (YHOO), Walt Disney (DIS), Money and Finance Today, Gap Inc (GPS), Southwest Airlines (LUV), US Airways Group (LCC), AMR Corp (AMR), Contl Airlines'B' (CAL), UAL Corp (UAUA), JetBlue Airways (JBLU), Delta Air Lines (DAL)

In the News:

· $4 Gas Forecast for Coming Week

· The Gap Weathers Sales Slump as 1Q Profit Surges 40% Thanks to Cost Management

· Airlines Running Short on Options

· Deal Reached in Tainted Pet Food Case

· Mesa Air's Future in Doubt

· Home Prices Post Record Decline

· Yahoo Nominates Existing Board for Re-Election

· High Gas Prices Force Cops to Walk the Beat More

· Disney Recalls Sleeping Bags, Toy Wands

Military Couple are Millionaires in the Making
If you're brave enough and willing, the Army can be a lucrative career. Just ask U.S. Army Captains Matthew and Kristen Shifrin. This military couple's plan is to save one paycheck and live off the other. That has them well on their way to meeting their financial goals.
Millionaires in the Making Millionaires in the Making: The Shifrins «

Safeguard Your Home Before a Storm Strikes
Disaster has stormed through homes from the Gulf of Mexico to the Atlantic Ocean, with 1,005 tornadoes reported so far this year and AccuWeather.com forecasts 12 named hurricanes this year. Take these steps now to protect your house and valuables -- plus, what to do after disaster hits.
Safeguard Your Home Before a Storm Strikes - Kiplinger.com

More Trouble Ahead for Fliers
Other carriers are likely to mirror American's plans to add checked-bag fee and cut seats.
Other Airlines Likely to Follow American's Lead -SmartMoney

Steps to Take to Avoid Having Your Car Stolen
Every 26.4 seconds, another car is stolen in the United States. Don't be part of this statistic. You can avoid starring as a car-heist victim in a real life "Gone in 60 Seconds" scenario by following these steps.
Putting the brakes on auto theft - Bankrate.com

Most Incredible Parking Garages
Parking structures are rarely sexy. But these nine buildings were built to accommodate automobiles in an architecturally sophisticated manner.
http://images.businessweek.com/ss/08/05/0521_beautiful_parking/index_01.htm?technology+slideshows

World's Best Vodka
Some drinkers say vodka has no taste. Discerning martini drinkers disagree. BusinessWeek's in-house bon vivant David Kiley thought it a good time to evaluate some of the top brands on the bar shelf. Ketel One and Ciroc tied for the top.
In Pictures: Best Vodkas World's Best Vodka? It's Anybody's Guess

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JetBlue sued for seating passenger on toilet

Michael Rainey — 2008-05-13T16:29:00+00:00

Filed under: JetBlue Airways (JBLU)

Well, at least the seat was free.

A man traveling on an employee buddy pass (and thus presumably flying for free) was ordered to sit in the bathroom of a packed JetBlue Airways Corporation (NASDAQ: JBLU) flight. He is now suing the company for $2 million.

Gokhan Mutlu claims that the pilot of a JetBlue flight from New York City to San Diego ordered him to sit in the bathroom after a flight attendant claimed his seat. The attendant apparently felt that her jump seat was uncomfortable; since Mutlu was not an employee, he couldn't sit in her jump seat. And on a full plane, that left the toilet as the only seating option on the five hour flight.

Mutlu wasn't crazy about the idea, but the pilot soon set him straight. According to the lawsuit, the pilot said that "he was the pilot, that this was his plane, under his command that (Mutlu) should be grateful for being on board." So the bathroom it was. Eventually, Mutlu was allowed to return to his original seat.

Whatever really happened, JetBlue can't afford any more bad press. The airline is still trying to make customers forget about trapping passengers on their planes for up to nine hours during bad weather last year.

On the other hand, maybe this isn't such bad news. It might just show that JetBlue pilots have a wicked sense of humor. Given the crowds expected on planes and runways this coming summer, that could be a good thing. JetBlue could even build an ad campaign around it: JetBlue - there's always an extra seat!

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Earnings highlights: Ford, Boeing, McDonald's, PepsiCo, JetBlue and others

Trey Thoelcke — 2008-04-27T11:40:00+00:00

Filed under: Earnings reports, Starbucks (SBUX), PepsiCo (PEP), Ford Motor (F), McDonald's (MCD), Halliburton (HAL), Boeing Co (BA), Hershey Co (HSY), Coach Inc (COH), ConocoPhillips (COP), Yum Brands (YUM), duPont(E.I.)deNemours (DD), Lockheed Martin (LMT), U.S. Steel (X), UAL Corp (UAUA), Dow Chemical (DOW), JetBlue Airways (JBLU), Goodyear Tire and Rubber (GT), Delta Air Lines (DAL)

Here are some highlights from this past week's earnings coverage from BloggingStocks:

American Axle & Manufacturing Holdings Inc. (NYSE: AXL) reported a strike-related Q1 loss.
Arch Coal Inc. (NYSE: ACI) Q1 profit tripled on increased demand and higher prices.
Boeing Co. (NYSE: BA) posted better-than-expected earnings despite Dreamliner delays.
Coach Inc. (NYSE: COH) better-than-expected quarter didn't impress Jim Cramer.
ConocoPhillips (NYSE: COP) reported Q1 earnings and revenue above analysts' forecasts.
Delta Air Lines Inc. (NYSE: DAL) reported a big loss on a one-time charge and fuel costs.
Dow Chemical Co. (NYSE: DOW) posted a smaller-than-forecast profit drop and predicted a good Q2.
EI DuPont de Nemours & Co. (NYSE: DD) Q1 earnings rose 26% but missed expectations.
Ford Motor Co. (NYSE: F) surprised Wall Street by swinging to a profit in the first quarter.
Goodyear Tire and Rubber Co. (NYSE: GT) easily surpassed analyst estimates for the first quarter.
Halliburton Co. (NYSE: HAL) Q1 earnings and revenue rose due to international growth.
Hershey Co. (NYSE: HSY) profit fell but was in line with analysts' expectations.

JetBlue Airways Corp. (NASDAQ: JBLU) reported a narrower-than-expected loss in the first quarter.
Lockheed-Martin Corp. (NYSE: LMT) posted solid Q1 results and raised its full-year outlook.
McDonald's Corp. (NYSE: MCD) easily beat Q1 estimates due to gains overseas.
Northwest Airlines Corp. (NYSE: NWA) reported a larger-than-expected loss due to fuel costs.
PepsiCo Inc. (NYSE: PEP) posted solid Q1 results that were merely inline with expectations.
Pepsi Bottling Group (NYSE: PBG) earnings were flat, but beat Wall Street expectations by a penny.
Potash Corp. of Saskatchewan Inc. (NYSE: POT) posted strong results on strong demand and price hikes.
Sonoco Products Co. (NYSE: SON) reported better-than-expected Q1 results and revised guidance.
Starbucks Corp. (NASDAQ: SBUX) preliminary Q2 results were lower than analyst's expected.
3M Co. (NYSE: MMM) beat earnings expectations and reaffirmed its guidance.
UAL Corp. (NASDAQ: UAUA) posted a worse-than-expected Q1 loss on rising fuel prices.
US Steel Corp. (NYSE: X) better-than-expected quarter didn't impress Jim Cramer.
Yum! Brands Inc. (NYSE: YUM) Q1 profits soared on overseas strength, and raised its guidance.

Also, Jim Cramer discusses "crummy lenders" and Jonathan Berr wonders if Ford's turnaround is for real. Joseph Lazzaro considers Citigroup Inc. (NYSE: C) as a barometer of the economy. One analyst thinks financials may have hit bottom and it may be time to buy, and Jon Ogg looks at what short sellers are making of tech stocks. Ted Allrich discusses what to sell/what to buy.

Upcoming results to watch for include Verizon Communications (NYSE: VZ), Tyson Foods (NYSE: TSN), CBS Corp. (NYSE: CBS), Countrywide Financial (NYSE: CFC), U.S. Steel Corp. (NYSE: X), Office Depot (NYSE: ODP), General Motors (NYSE: GM), Procter & Gamble (NYSE: PG), Kraft Foods (NYSE: KFT), Starbucks (NASDAQ: SBUX), Time Warner (NYSE: TWX), Comcast (NASDAQ: CMCSA), Exxon Mobil (NYSE: XOM), and Chevron (NYSE: CVX).

Visit AOL Money & Finance for more earnings coverage.

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JetBlue (JBLU) pushed lower by record oil, despite hopeful earnings

Brent Archer — 2008-04-22T14:44:00+00:00

Filed under: Major movement, Earnings reports, Bad news, Industry, UAL Corp (UAUA), Options, Technical Analysis, JetBlue Airways (JBLU), Oil

JetBlue Airways Corp. (NASDAQ: JBLU) opened higher this morning after the airline reported a first-quarter loss of $8 million, or 4 cents a share, narrower than analyst estimates of 7 cents per share. However, losses from competitors like United (NASDAQ: UAUA) and record-high oil prices have brought JetBlue stock down for a rough landing. If you think that the company's earnings are the real deal and it won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on JBLU.

After hitting a one-year high of $11.99 in July, the stock hit a one-year low of $4.30 in January. JBLU opened this morning at $5.10. So far today the stock has hit a low of $4.50 and a high of $5.11. As of 12:40, JBLU is trading at $4.57, down $0.36 (-7.3%). The chart for JBLUlooks neutral and deteriorating, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bullish hedged play on this stock, I would consider a December covered call at the $5 level. A covered call is an options position that combines the purchase of stock with the sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 34.4% return in eight months if JBLU is above $5 at December expiration. JetBlue would have to fall by more than 18% before we would start to lose money. Learn more about this type of trade here.

JBLU hasn't been below $4 at all in the past year and has shown support around $4.50 recently, while the break-even point of this position is near $3.70. This trade could be risky if fuel prices continue to skyrocket, but even if that happens, this position could be protected by the support the stock might find around $4.30, at its 52-week low.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in JBLU or UAUA.

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Flying the unfriendly skies

Jonathan Berr — 2008-04-07T15:43:00+00:00

Filed under: Consumer experience, Competitive strategy, Southwest Airlines (LUV), US Airways Group (LCC), JetBlue Airways (JBLU)

Anyone planning a vacation this summer should remember two words: AirTran and Jet Blue Airways Corp. (NASDAQ: JBLU).

Those were the two airlines that came out on top of a national survey of airline quality released today that underscored the sorry state of the industry. Anyone who has flown since 9-11 knows that getting your teeth pulled is more fun. Planes are filled to the brim and are often late. Luggage often goes on magical mystery tours that bypass your destination.

Last year was more of the same, according the Associated Press

"There were more lost bags, more bumped passengers, more consumer complaints and fewer on-time flights than in the previous year," the story says. "The rate of consumer complaints was up 60 percent. US Airways (NYSE: LCC) had the most complaints last year. Southwest (NYSE: LUV) had the fewest."

Bad airlines are bad for the environment because it encourages more casual fliers to drive to their destinations. Even with soaring gas prices, flying isn't worth the trouble. I may have to fly this summer and I'm already dreading it.

--Freelance writer Jonathan Berr edits the blog Ketchup and Eggs.

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Airlines stand to profit from your $600 rebate check

Aaron Katsman — 2008-04-02T16:23:00+00:00

Filed under: Products and services, Industry, Southwest Airlines (LUV), Personal finance, JetBlue Airways (JBLU)

I have had some clients ask me, what industry I think will benefit from the $600 rebate checks that are due to be sent out as part of the U.S. economic stimulus package. I think airlines will benefit, especially lower cost carriers like Southwest (NYSE: LUV) and Jet Blue (NASDAQ: JBLU).

The USA Today has an article about the kind of vacation you can have for $600. The article says: "With most Americans expecting to receive a tax rebate of up to $600 ($1,200 for married couples), there are plenty of ways to get the most vacation for your buck, say travel experts. Whether it's a cruise, a tropical paradise, or family travel, these trips can all be done for under $600 a person."

Because we aren't talking about flying around the world or across the Atlantic for that measure, trips to Las Vegas or Orlando, for example, will fit the family, and of course people need a way to get to these destinations, so that's how the airlines become interesting. Throw into the mix potentially stable or even lower fuel costs, and for investors looking for a way to play the "Rebate check" game, you may want to take a look at the airlines.

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Stuck on the runway: Clean your own toilet

Aaron Katsman — 2008-03-25T18:09:00+00:00

Filed under: Products and services, Law, Consumer experience, JetBlue Airways (JBLU)

Ruling that it's not in their jurisdiction an appeals court rejected a New York state law that would have required airlines to provide food, clean toilets, water, and fresh air to passengers stranded on a plane that's been delayed. The NY law came in response to last winter's fiasco at JFK airport when multiple airlines, most notably JetBlue Airways Corporation (NASDAQ:JBLU) were stuck on the runway for 10 hours and passengers had no food, or clean toilets.

According to an AP report: "The court said that while the goals of the law were "laudable" and the circumstances prompting its adoption "deplorable," only the federal government has the authority to pass such regulations.

"If New York's view regarding the scope of its regulatory authority carried the day, another state could be free to enact a law prohibiting the service of soda on flights departing from its airports, while another could require allergen-free food options on its outbound flights, unraveling the centralized federal framework for air travel," the court wrote.

While clearly not popular, the court ruled correctly. This is a federal issue. While politicians will try and score points protesting the decision, if their constituents feel strongly about this issue they need to get on the phone and call their representatives in Washington and have them try and come up with legislation which would provide passengers with the much needed relief.

In the meantime, until Congress takes up the issue, make sure you buy some bottled water in the airport and take it with you. With summer approaching, you don't want to dehydrate waiting for your plane to take-off.

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JetBlue (JBLU) rises as crude dips below $100

Brent Archer — 2008-03-20T13:08:00+00:00

Filed under: Major movement, Analyst reports, Industry, Options, Technical Analysis, JetBlue Airways (JBLU)

JetBlue Airways Corporation (NASDAQ: JBLU) shares are rising today even after analysts at UBS and Lehman Brothers have reduced earnings estimates and downgraded some of JBLU's competitors this morning, including UAL Corp. (NASDAQ: UAUA) and US Airways (NYSE: LCC), on record fuel costs and recession worries. JBLU shares are moving higher as oil prices have fallen below $100 a barrel on data suggesting lower demand for fuel in a weakening U.S. economy. If you think that the company won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on JBLU.

After hitting a one-year high of $12.32 last March, the stock hit a one-year low of $4.30 in January. JBLU opened this morning at $5.23. So far today the stock has hit a low of $5.00 and a high of $5.47. As of 12:15, JBLU is trading at $5.46, up 46 cents (9.2%). The chart for JBLU looks bearish and steady, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bullish hedged play on this stock, I would consider a September covered call at the $5 level. A covered call is a combination option and stock position that combines the purchase of stock with the sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. This particular trade will make a 22.4% return in just six months if JBLU is above $5 at expiration in September. JetBlue would have to fall by more than 24% before we would start to lose money on this trade.

JBLU hasn't been below $4, which would be the break-even point, at all in the past year and has shown support around $4.50 recently. This trade could be risky if the price of fuel, but even if that happens, this position could be protected by the support the stock might find just below $5, where the stock has bounced twice in the past few months.

Brent Archer is an options analyst and writer at Investors Observer. At publication time, Brent neither owns nor controls positions in JBLU.

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A year ago today on BloggingStocks

Trey Thoelcke — 2008-03-16T09:40:00+00:00

Filed under: Google (GOOG), Microsoft (MSFT), Starbucks (SBUX), Southwest Airlines (LUV), JetBlue Airways (JBLU), Blackstone Group L.P (BX)

Sometimes in a period of uncertainty, a look back can provide some perspective. So here are a few highlights from BloggingStocks on March 16, 2007,a year ago today.

Business & Sports: Oil, Duke, & Notre Dame -- down: What's bigger news, who's in the March Madness or oil dropping below $57 a barrel?
Will '300' controversy result in higher ticket sales?: Yeah, because this should be the main source of contention between the U.S. and Iran.
An OPIC to counter OPEC: An Organization of Petroleum Importing Countries? Whatever became of that?
Harry Potter and the 12 million order: Will the final movie in the Harry Potter series -- er, make that two movies -- generate this kind of excitment? Will anything?
The CPI Numbers: Wall Street breathes brief sigh of relief: Wall Street could use another sigh of relief about now.
Time magazine's facelift: Magazines? Is anyone still reading those?
Microsoft's Ballmer takes more shots at Google: Microsoft (NASDAQ: MSFT) has a beef with Google (NASDAQ: GOOG)? Who'd have guessed?
Heineken -- the next Starbucks?: Does Heineken still want Starbucks (NASDAQ: SBUX) as a role model?
CNBC: Blackstone prepping for mega IPO: Remember the days when private equity was king?
The Story You Didn't Read: Digital killed the TV star: TV is going digital? Seems like I heard something about that somewhere recently?
Subprime investment opportunities?: Investment banks struggling with the subprime mess? The more things change ...
JetBlue passengers grounded ... again: Last year it was JetBlue (NASDAQ: JBLU) cancellations; this year it's Southwest (NYSE: LUV) cancellations.

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Buffett letter offers great lessons for investors

Timothy Sykes — 2008-03-03T11:00:00+00:00

Filed under: Berkshire Hathaway (BRK.A), Citigroup Inc. (C), Merrill Lynch (MER), Federal Natl Mtge (FNM), Southwest Airlines (LUV), Washington Mutual (WM), AMR Corp (AMR), UAL Corp (UAUA), JetBlue Airways (JBLU), Delta Air Lines (DAL)

As you can tell from this post on my blog, I am no fan of value investing. While I believe investors, especially smaller investors, should partake in more aggressive strategies, I do respect its high priest, Warren Buffett. Since its release late Friday last week, his annual letter to Berkshire Hathaway (NYSE: BRK.A) shareholders has already been dissected here, here and here by those much smarter than me, but I offer my take on four important passages in his remarkable letter:

"You only learn who has been swimming naked when the tides goes out - and what we are witnessing at some of our largest financial institutions is an ugly sight."

Hmm, could he be referring to troubled companies like Washington Mutual (NYSE: WM), Citigroup (NYSE: C) Merrill Lynch (NYSE: MER), Ambac Financial (NYSE: ABK) and Fannie Mae (NYSE: FNM)? Too late to do anything about it this cycle, but in the future we need greater industry transparency!

"The worst sort of business is one that grows rapidly, requires significant capital to engender growth, and then earns little or no money. Think airlines."

I agree 100%, just say no to investing in companies like Delta Airlines (NYSE: DAL), UAL Corp (NASDAQ: UAUA), AMR Corp (NYSE: AMR), Southwest Airlines (NYSE: LUV) and JetBlue Airways (NASDAQ: JBLU) in that cursed industry.

"At Berkshire, we will attempt to further increase our stream of direct and indirect foreign earnings."

Despite our country's incredible past success, it's important that investors now look elsewhere.

"But I'll make more mistakes in the future - you can bet on that."

Contrary to popular belief, mistakes are not the enemy - everybody makes them - the key is learning from them!

Timothy Sykes writes the blog timothysykes.com, is a former hedge fund manager, star of the TV show Wall Street Warriors and author of the book, An American Hedge Fund: How I Made $2 Million as a Stock Operator & Created a Hedge Fund

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Earnings highlights: Exxon, Boeing, Halliburton, Sony, UPS, Honda and others

Trey Thoelcke — 2008-02-02T12:40:00+00:00

Filed under: Earnings reports, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), Exxon Mobil (XOM), Halliburton (HAL), Sony Corp ADR (SNE), Boeing Co (BA), United Parcel'B' (UPS), U.S. Steel (X), Dow Chemical (DOW), Valero Energy (VLO), JetBlue Airways (JBLU), Burlington Northern Santa Fe (BNI), Raytheon Company (RTN)

The earnings crunch is in full swing, and here are a few of the highlights of this past week's earnings coverage from BloggingStocks:

Airgas Inc. (NYSE: ARG) beat expectations and raised its guidance.
Boeing Co. (NYSE: BA) beat estimates and said the 787 Dreamliner was on schedule.
Burlington Northern Santa Fe Corp. (NYSE: BNI) fourth-quarter profits fell on rising fuel costs.
Crane Co. (NYSE: CR) beat expectations and raised its guidance.
Dow Chemical Co. (NYSE: DOW) profits fell due to rising costs of raw materials.
Exxon Mobil Corp. (NYSE: XOM) posted the largest annual and quarterly profit ever by a U.S. company.
Halliburton Co. (NYSE: HAL) beat earnings expectations due to strong international growth.
Honda Motor Co. (NYSE: HMC) posted record earnings for the third quarter on demand for fuel efficiency.
JetBlue Airways Corp. (NASDAQ: JBLU) posted a narrower-than-expected loss.
Nissan Motor Co. (NASDAQ: NSANY) posted strong results due in part to U.S. sales of the Rogue.
Occidental Petroleum Corp. (NYSE: OXY) fourth-quarter profit surged, leading to its best yearly results ever.
Paraexel International Corp. (NASDAQ: PRXL) beat estimates and offered revised guidance.
Ratheon Co. (NYSE: RTN) posted strong fourth-quarter results and offered optimistic guidance.
RightNow Technologies Inc. (NASDAQ: RNOW) posted a loss, though revenues were up.
Sony Corp. (NYSE: SNE) posted solid results on TV sales and the game division's return to the black.
Stanley Works (NYSE: SWK) posted solid results despite the housing slump due to strength overseas.
United Parcel Service Inc. (NYSE: UPS) met earnings estimates due to a pension-related charge.
US Steel Corp. (NYSE: X) fourth-quarter and full-year profits declined on acquisition costs and job cuts.
Valero Energy Corp. (NYSE: VLO) beat expectations despite a profit decline of 49%.

For additional BloggingStocks earnings highlights, see Yahoo!, Google, Amazon, Countrywide, Merck, UBS and others and McDonald's, Kraft, P&G, Verizon, MasterCard, 3M and others.

Also, in the wake of earnings reports from Yahoo! (NASDAQ: YHOO) and Google (NASDAQ: GOOG), Microsoft Corp. (NASDAQ: MSFT) made a move for Yahoo! Rumor has Google going after AOL in response. Meanwhile, Timothy Sykes has some advice for buying stocks ahead of earnings reports.

Upcoming results to watch for include Archer Daniels Midland (NYSE: ADM), Yum Brands (NYSE: YUM), Walt Disney (NYSE: DIS), Cisco Systems (NASDAQ: CSCO), Time Warner (NYSE: TWX), and PepsiCo. (NYSE: PEP).

Visit AOL Money & Finance for more earnings coverage.

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