Borrowing billions of dollars to try to build a business from scratch is always a bad idea. Companies tend to under-estimate expenses and over-estimate revenues in order to sell stock and debt at attractive rates. When investors and lenders get wise, they tend to stop putting fresh money into the business, often when it is only half built. That was the ignominious fate suffered by Sirius Satellite Radio, which was forced to merge with rival XM Radio back in 2007. That effort simply combined two money-losing entities into one larger money losing entity known as Sirius XM… Read More

Borrowing billions of dollars to try to build a business from scratch is always a bad idea. Companies tend to under-estimate expenses and over-estimate revenues in order to sell stock and debt at attractive rates. When investors and lenders get wise, they tend to stop putting fresh money into the business, often when it is only half built. That was the ignominious fate suffered by Sirius Satellite Radio, which was forced to merge with rival XM Radio back in 2007. That effort simply combined two money-losing entities into one larger money losing entity known as Sirius XM Radio (Nasdaq: SIRI). As a quick refresher, Sirius generates the bulk of its new customers by offering limited free-trails to buyers of new cars. The company is also aggressively pursuing the used car market these days. According to the Department of Transportation, there were more than 250 million passenger vehicles on the road in the United States in 2007. Sirius estimates that 27 million of those vehicles have factory-installed satellite radios. About 11.6 million of those vehicles have active subscribers at the wheel, with 15.3 million that are active radios but are not enabled. Read More

Sometimes, investors just need an excuse to sell. If they feel like worrying, there are always an ample amount of things to worry about. A few months ago, Greece was the concern du jour. Even though it’s a tiny economy, and has almost… Read More

Real estate was one of the hardest-hit sectors of the market during the financial crisis, and for good reason. After all, the real estate market caused all of this mess in the first place. According to the… Read More

Over the last half decade, two tech giants have learned to accommodate each other. Apple (Nasdaq: AAPL) became the darling of consumers everywhere with its iPod, iPhone, and iPad. And Research in Motion (Nasdaq: RIMM) held a tight grip on the smartphone market for business users with its line of… Read More

Here’s a weight-loss product that helps slim bulging waistlines but can fatten your trading portfolio. Herbalife (NYSE: HLF) is a leading weight management company that sells diet shakes, snacks and nutritional supplements. Nearly two-thirds of Americans currently battle obesity, and the demand for weight-loss… Read More

With a mountain of technology patents under its belt, technology firm Rambus (Nasdaq: RMBS) has a long history of successfully suing any firm that appears to use its intellectual property (IP) without permission. Just last month, we discussed the company’s latest legal challenges to secure royalties. On… Read More

Don’t let the stock action fool you. Just because shares of Micron Technology (NYSE: MU) are off more than -10% in Tuesday trading, the company’s Monday night earnings release should give a cheer to the entire tech sector — that is, when investors are ready to once again embrace this highly cyclical industry. Right now, the whole technology group is getting no love from investors for fear that global economic pressures will kill the party before it really gets underway. Read More

Don’t let the stock action fool you. Just because shares of Micron Technology (NYSE: MU) are off more than -10% in Tuesday trading, the company’s Monday night earnings release should give a cheer to the entire tech sector — that is, when investors are ready to once again embrace this highly cyclical industry. Right now, the whole technology group is getting no love from investors for fear that global economic pressures will kill the party before it really gets underway. But the party has already started, if you look at the tech results we saw in the spring. Micron’s fiscal third-quarter results simply underscore the industry momentum that is already underway. For example, Micron’s sales doubled from the year-ago quarter, and a $246 million operating loss back then has morphed into a $540 million gain in the most recent quarter. Gross margins rose from 9.7% a year ago to 37.1% this time around. (Analysts expected gross margins to be only 35% — not because selling prices were higher than they expected, but because cost control was… Read More

When it comes to price-to-earnings (P/E) ratios, the notion of “buy low and sell-high” doesn’t always apply. Some stocks with the lowest P/Es are cheap for good reason. Perhaps they are in the midst of a long-term decline that will see sales and profits… Read More

Investors may feel like they have nowhere to turn during times like these. Equity investors have seen a -35% return in the S&P 500 during the past 10 years, making it known as “The Lost Decade.” Meanwhile, those who turn to bonds are likely to find themselves sorely disappointed — the 10-year T-bill currently yields a measly 3.02%. So what’s an investor to do? Well, there is a security that provides diversification with bond-like regular income along with a shot at capital gains. Trouble is, most people haven’t heard of… Read More

Investors may feel like they have nowhere to turn during times like these. Equity investors have seen a -35% return in the S&P 500 during the past 10 years, making it known as “The Lost Decade.” Meanwhile, those who turn to bonds are likely to find themselves sorely disappointed — the 10-year T-bill currently yields a measly 3.02%. So what’s an investor to do? Well, there is a security that provides diversification with bond-like regular income along with a shot at capital gains. Trouble is, most people haven’t heard of it. And if they have, investors often shy away from them because they seem too complicated. It’s a real shame, because these readily available securities often make terrific investments for a portfolio. The security in question is known as “preferred stock.” Investors should think of preferreds as stock-bond hybrids, because they share characteristics of both. Let’s walk through how a preferred issuance is characterized and how investors can score juicy and stable returns. Hospital REIT Ashford Hospitality Trust (NYSE: AHT) issued eight million… Read More

It just might be one of the biggest, far-reaching pacts of the decade — and I’m betting you’ve never heard of it. It will govern business in more than a dozen countries, influence the shopping patterns of 1.9 billion consumers and facilitate trade in a region whose annual… Read More