When business school professors look back on this era, they’ll likely talk to their students about one of the greatest turnarounds in the history of enterprise. Few companies have gone from near-death to industry titan in such a short time as Ford Motor (NYSE: F). And investors have showed their respect, with shares rising from under $2 in early 2009 to $17 just 20 months later. That’s an +850% gain! But signs are emerging that the party may be over for now. Shares made a quick move from $12 since mid-September… Read More

When business school professors look back on this era, they’ll likely talk to their students about one of the greatest turnarounds in the history of enterprise. Few companies have gone from near-death to industry titan in such a short time as Ford Motor (NYSE: F). And investors have showed their respect, with shares rising from under $2 in early 2009 to $17 just 20 months later. That’s an +850% gain! But signs are emerging that the party may be over for now. Shares made a quick move from $12 since mid-September (a +40% jump in two months), yet now appear to be hit by some profit-taking since last Monday. There’s no doubt that shares have plenty more upside: the stock trades for just eight times projected 2010 profits, and the auto industry is likely to see higher volume down the road. But the coming year still holds real challenges for this auto maker. Here are five key issues you’ll need to track if you own shares of Ford. If these items come to pass and shares slip back to the lower teens, it would create a fresh compelling… Read More

When it comes to investing in emerging markets, Brazil is often mentioned as one of the most appealing countries. This is for good reason — its population of more than 200 million represents one of the world’s largest markets. Better yet, years of economic… Read More

As GM (NYSE: GM) celebrates an impressive re-entry into the public markets, investors are chewing over a clear theme. Both GM and Ford (NYSE: F) are far healthier companies, with much leaner cost structures and the ability to generate sharply improved profit margins as industry volumes rebound. In their shadow, key auto parts suppliers are also now in fighting shape after being bruised and battered in the economic freefall of 2008. The new adage for the industry: “what doesn’t kill you makes you stronger.” How bad did it get for… Read More

As GM (NYSE: GM) celebrates an impressive re-entry into the public markets, investors are chewing over a clear theme. Both GM and Ford (NYSE: F) are far healthier companies, with much leaner cost structures and the ability to generate sharply improved profit margins as industry volumes rebound. In their shadow, key auto parts suppliers are also now in fighting shape after being bruised and battered in the economic freefall of 2008. The new adage for the industry: “what doesn’t kill you makes you stronger.” How bad did it get for these auto parts suppliers? Domestic auto makers produced 15-16 million cars and trucks every year from 2001 to 2007. That figure fell to 12.5 million in 2008 and just 8.5 million in 2009. Years of steady profits were offset by massive losses in 2008 and 2009, and a number of these firms flirted with bankruptcy. For a short while, many of their stocks traded below $1. In a testament to just how much they have changed, all of the key players are likely to be nicely profitable again this year, even though the industry will produce just 11.5 million units. Read More

The ranks of “super-investors” are few, highlighted by the likes of Warren Buffett, George Soros and Carl Icahn. Investors like to track their every move. Smart investors should also watch the moves of David Einhorn, who runs Greenlight Capital. He started with just $1 million in 1996,… Read More

Imagine hearing this from your financial advisor: “I’ve got a great stock for you. It’s down -20%, the company lost $7 billion this year, and its reputation stinks.” You’d probably get up and walk out the door, right? But what if, just before you… Read More

I’ve always had a contrarian streak. Conventional wisdom is more a jumping off point for me than it is an anchor for my investment decisions. And I’ve found it usually pays off handsomely to follow my own research rather than… Read More

Pity the average investor. They tend to jump into and out of the stock market at precisely the wrong times. In late August, I looked at the weekly investor sentiment poll conducted by the American Association of Individual Investors (AAII) and noted that most investors feared a big market tumble. [Read that article here] Historically speaking, you want to start buying stocks when most individual investors are shunning them. And that has once again proven to be the case. Since that August swoon, the S&P 500 has risen +14%. And like clockwork, that impressive performance has turned… Read More

Pity the average investor. They tend to jump into and out of the stock market at precisely the wrong times. In late August, I looked at the weekly investor sentiment poll conducted by the American Association of Individual Investors (AAII) and noted that most investors feared a big market tumble. [Read that article here] Historically speaking, you want to start buying stocks when most individual investors are shunning them. And that has once again proven to be the case. Since that August swoon, the S&P 500 has risen +14%. And like clockwork, that impressive performance has turned individual investors from bears to bulls. In the week ending November 10th, 57.6% of retail investors were bullish, according to the latest AAII poll. That’s up +9.3 percentage points from the prior week, and the most bullish reading since January 2007. So if bearish sentiment is always good for stocks, is bullish sentiment always bad for stocks? I pored over 25 years’ worth of data to gauge the market’s subsequent returns every time investors were more than 55% bullish. The results are mixed… An unusual spike… Read More

It’s been a tough year for Chinese stocks that trade in the United States. Many of them have sold off — and stayed cheap — even as they sport impressive growth rates and low valuations. Thanks to a sharp drop on Friday on renewed concerns about an overheating economy,… Read More

To make money in stocks, it often helps to study history’s greatest investors. Like many finance enthusiasts, I’m a fan of Peter Lynch, who’s best known for his spectacular results as manager of the Fidelity Magellan Fund from 1977 through 1990, when the fund’s total returns averaged +29% a year. Read More

Despite a fairly bleak quarterly report from Cisco Systems (Nasdaq: CSCO) on Thursday, investors should realize that troubles for Cisco don’t mean trouble for the whole sector. In fact, the tech sector has shaken off the gloom and doom of this summer, with the Nasdaq surging +20% since late August. Read More