amazon.com Inc.
NASDAQ symbol AMZN, is the leading bookseller on the Internet, as well as a leading video and music seller. It also has numerous other store categories, including electronics, computer games, toys and tools. Through Amazon Services, the company also offers programs that let sellers market on its web sites.
PLEASE NOTE: Next week, Wall Street Stock Forecaster, our newsletter that focuses on the U.S. stock markets, will reveal its #1 pick for 2011. If you’re not already a Wall Street Stock Forecaster subscriber, click here to learn how you can get one month — including the Wall Street Stock Forecaster Stock of the Year —FREE. AMAZON.COM INC., $177.42, symbol AMZN on Nasdaq, has agreed to pay $320 million for the 58% of privately held Lovefilm International Ltd. that it didn’t already own. Amazon.com took a minority stake in U.K.-based Lovefilm after it sold its DVD rental business in the U.K. and Germany to Lovefilm in 2008....
SPDR DOW JONES INDUSTRIAL AVERAGE ETF $112.30 (New York Exchange symbol DIA; buy or sell through brokers; www.spdrs.com) holds the 30 stocks that make up the Dow Jones Industrial Average. The fund’s top holdings are IBM, Exxon Mobil, Chevron Corp., 3M, Procter & Gamble, McDonald’s Corp., Johnson & Johnson, Caterpillar Inc., United Technologies and Boeing Co. The fund’s expenses are about 0.18% of its assets. SPDR Dow Jones ETF is a buy....
Exchange-traded funds (ETFs) may have a place in your portfolio. That’s because, unlike many other financial innovations, they don’t load you up with heavy management fees, or tie you down with high redemption charges if you decide to get out of them. Instead, they give you a low-cost, flexible, convenient alternative to mutual funds. ETFs trade on stock exchanges, just like stocks. Prices are quoted in newspaper stock tables and online. You’ll have to pay brokerage commissions to buy and sell ETFs. However, ETFs’ low management fees still give them a cost advantage over most conventional mutual funds. As well, shares are only added or removed when the underlying index changes. As a result of this low turnover, you won’t incur the regular capital-gains bills generated by the yearly distributions most conventional mutual funds pay out to unitholders....
Akamai Technologies Inc., $48.65, symbol AKAM on Nasdaq (Shares outstanding: 181.6 million; Market cap: $8.8 billion), helps companies improve the performance of their web sites. (Akamai is a Hawaiian word meaning “smart”.) The company’s customers include Amazon.com, Adobe Systems, Apple, Microsoft and Yahoo. Akamai mirrors a customer’s web site onto its own network of servers, which are located in over 70 countries. That speeds up download times and cuts the risk of Internet outages or slowdowns, because users can access the closest server, or the one with the fastest connection. Demand for Akamai’s services continues to rise, particularly as more people use the Internet to view videos. The company gets 28% of its revenue from customers outside of the U.S....
POTASH CORP. OF SASKATCHEWAN, $145.00, Toronto symbol POT, has moved down from its recent peak of $160.65. That’s mostly because the Canadian government appears more likely to block or impose conditions on BHP Billiton Ltd.’s (New York symbol BHP) $130.00 U.S.-a-share takeover of Potash Corp. As well, Potash Corp. has launched a lawsuit to stop the takeover. The suit accuses BHP of making misleading statements about the potash industry to depress Potash Corp.’s share price prior to making its offer. Potash Corp. is still a hold....
AMAZON.COM $129.65 (Nasdaq symbol AMZN; SI Rating: Extra Risk) (206-266-1000; www.amazon.com; Shares outstanding: 447.8 million; Market cap: $58.1 billion; No dividends paid) reports that its sales jumped 41.2% in the latest quarter, to $6.6 billion from $4.7 billion a year earlier. Earnings per share rose 39.4%, to $0.46 from $0.33. Sales of electronic books for its Kindle reader continue to grow strongly. In the first half of 2010, Amazon sold 143 e-books for every 100 hardcover books. In the month of June, that ratio rose to 180:100. Amazon was one of the first companies to sell e-books. But major competitors, particularly Apple’s iPad, will erode that advantage....
AMAZON.COM INC., $118.81, symbol AMZN on Nasdaq, reported sharply higher results in the latest quarter. In the three months ended June 30, 2010, Amazon’s sales jumped 41.2%, to $6.6 billion from $4.7 billion a year earlier. Earnings jumped 45.8%, to $207 million, or $0.46 a share, from $142 million, or $0.33 a share. Despite the big gain, the latest earnings fell short of the consensus estimate of $0.54 a share. Amazon’s North American media sales rose 15.3% during the quarter. Overall media sales climbed 17.7%, to $2.9 billion. However, sales of electronics and other general merchandise jumped 68.6% to $3.5 billion. Sales in the company’s “other” category, which includes Amazon’s web-services business, rose 45%, to $203 million....
POWERSHARES QQQ ETF $43.96 (Nasdaq symbol QQQQ; buy or sell through brokers), formerly called Nasdaq 100 Trust Shares, holds the stocks that represent the Nasdaq 100 Index. That index is made up of the 100 largest shares on the Nasdaq exchange based on market cap. The Nasdaq 100 Index contains firms from a number of major industries, including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. It does not contain financial companies. The fund’s expenses are about 0.20% of its assets. The index’s highest-weighted stocks are Apple, Microsoft, Qualcomm, Google, Cisco Systems, Intel, Amazon.com, Oracle Corp., Gilead Sciences and Teva Pharmaceuticals....
PLEASE NOTE: Our next Hotline will go out on Friday, July 9, 2010. AMAZON.COM INC., $121, symbol AMZN on Nasdaq, has dropped the price of its Kindle electronic-book reader by 27%, to $189 from $259 (all amounts in U.S. dollars). The move came after Barnes & Noble dropped the price of its Nook e-book reader to $199 and introduced a Wi-Fi only version for $149. The Wi-Fi version can only download e-books through private Wi-Fi networks, in Barnes & Noble stores and in places where AT&T offers Wi-Fi service. In contrast, the more expensive Nook comes with an unlimited 3G cellular Internet link for downloads....
INDIGO BOOKS & MUSIC INC. $15 (Toronto symbol IDG; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 24.5 million; Market cap: $367.5 million; Price-to-sales ratio: 0.4; Dividend yield; 2.9%; SI Rating: Average) is seeing strong demand for its new Kobo electronic-book reader. That’s largely because the Kobo reader costs much less than its main competitor, Amazon.com’s Kindle. Indigo owns 57.7% of the Kobo joint venture; U.S.-based bookseller Borders Group Inc. (New York symbol BGP) and other private investors own the remaining 42.3%. The joint venture will soon start selling Kobo readers in the U.S., Australia and New Zealand. The partners also plan to launch Kobo in Europe, China and India. Indigo is a buy.