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Agilent is up 9.5% since it was spun off from its parent company 14 years ago. We take a look at the outlook for this tech stock which bases its growth on an aggressive acquisition strategy. AGILENT TECHNOLOGIES INC. (New York symbol A; www.agilent.com) makes testing systems that help electronics firms improve their products. It also manufactures testing gear for medical research labs. Agilent was a unit of Hewlett-Packard until 1999, when Hewlett spun it off as a separate firm....

INTERNATIONAL BUSINESS MACHINES CORP., $206.35, New York symbol IBM, is paying an undisclosed sum for SoftLayer Technologies. Based in Dallas, Texas, this privately held firm sells online data-storage space and related services to 21,000 business clients. It has 13 data centres in the U.S., Asia and Europe. IBM expects to complete this purchase by September 30, 2013. Demand for cloud computing, which mainly involves storing data on remote, secure servers, is growing strongly. That’s because it gives cost-conscious businesses access to better services and software without the high cost of buying and setting up their own servers. SoftLayer’s technology will enhance IBM’s cloud-computing expertise and help it increase its annual revenue from this field to $7 billion by 2015. To put that in context, IBM’s total revenue was $104.5 billion in 2012....

AMAZON.COM $278.16 (Nasdaq symbol AMZN; TSINetwork Rating: Extra Risk) (206- 266-1000; www.amazon.com; Shares outstanding: 455.2 million; Market cap: $128.3 billion; No dividends paid) has invested heavily in cloud computing. This is now paying off with some big contracts: earlier this year, it won a $600-million deal with the U.S. Central Intelligence Agency to build a cloud-computing service.

The CIA has traditionally awarded many of its big computing contracts to IBM (New York symbol IBM), a recommendation of our Wall Street Stock Forecaster newsletter.

IBM has protested the awarding of this deal to Amazon, and the U.S. Government Accountability Office recently recommended that the CIA reopen negotiations. The CIA now has 60 days to say whether it will follow this recommendation.
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The new U.S. health care law (“Obamacare”) will force Baxter International to pay a 2.3% tax on certain medical devices it sells in the country. However, the law will also expand health insurance to more Americans, which should spur demand for the company’s products. It is also increasing its overseas sales. The U.S. accounts for just 40% of Baxter’s sales....

YUM BRANDS INC., $67.75, New York symbol YUM, has opened a new KFC fried chicken restaurant in Ulaanbaatar, the capital city of Mongolia. This is the first fast-food restaurant in Mongolia. The local franchisee that owns and operates this outlet plans to open 15 more over the next five years. This business’s outlook is bright. Mongolia’s economy is growing strongly, and chicken is becoming more popular. Yum and its partner will also develop new dishes that cater to local tastes....

Please note: The next Wall Street Stock Forecaster newsletter issue will be sent out on Friday, May 31, 2013. HEWLETT-PACKARD CO., $24.21, New York symbol HPQ, reported lower earnings this week. Even so, they still beat the consensus forecast. That’s why the stock rose 14%. Hewlett earned $1.7 billion in its fiscal 2013 second quarter, which ended April 30, 2013. That’s down 12.9% from $1.9 billion a year earlier. Earnings per share fell 11.2%, to $0.87 from $0.98, on fewer shares outstanding. These figures exclude several unusual items, mainly costs related to a restructuring plan that includes merging Hewlett’s personal computer and printer divisions, simplifying its product lines and cutting 8% of its workforce. On that basis, the latest earnings beat the consensus estimate of $0.81 a share....

In October 2012 Kraft Foods Inc. broke up into two separate companies, Kraft Foods Group (Nasdaq symbol KRFT) and Mondelez. Recently, we looked at Kraft (view the daily post here), whose operations are now focused on North America. Today we look at its spinoff, Mondelez, which gets most of its sales from overseas markets. MONDELEZ INTERNATIONAL INC. (Nasdaq symbol MDLZ; www.mondelezinternational.com) makes cookies and biscuits (Oreo, Chips Ahoy, Ritz), chocolate bars (Cadbury, Toblerone) and gum and candy (Trident, Chiclets, Halls cough drops). It also makes beverages, including coffee (Tassimo) and powdered fruit drinks (Tang), as well as grocery and cheese products for overseas markets. Mondelez gets 46% of its sales from developing countries, 35% from Europe and 19% from North America....

Please note: The next issue of Wall Street Stock Forecaster will be sent out on Friday, May 31, 2013. SONY CORP. ADRs, $20.34, New York symbol SNE, jumped 14% this week after Dan Loeb, an activist investor who owns 6.3% of Sony’s shares, announced a plan aimed at unlocking some of the company’s value. Loeb is the same investor who pressed Yahoo! Inc. (Nasdaq symbol YHOO) to replace its chief executive officer with Marissa Mayer, a former vice-president at Google (see below). Loeb’s plan involves sell 15% to 20% of Sony’s entertainment division through an initial public offering. This division, which makes movies, television programs and music recordings, supplied just 17% of Sony’s revenue in the fiscal year ended March 31, 2013. But due to large losses at Sony’s TV and cellphone divisions, the entertainment business accounted for a high 45% of the company’s earnings....

TELUS CORP., $37.39, Toronto symbol T, has agreed to buy rival wireless carrier Mobilicity. This privately held company began operating in 2010 and has 250,000 subscribers, mainly in large cities like Toronto, Vancouver, Calgary and Edmonton. To put that in context, Telus has 7.7 million wireless customers across Canada. Like other new entrants into Canada’s wireless market, Mobilicity has had a hard time competing with large, established carriers like Telus. As a result, it is close to bankruptcy....

General Motors, $31.00, symbol GM on New York (Shares outstanding: 1.4 billion; Market cap: $51.9 billion; www.gm.com), designs, builds and sells cars, trucks and automobile parts worldwide. It also provides automotive financing services through General Motors Financial Company. In the three months ended March 31, 2013, GM’s revenue fell 2.3%, to $36.8 billion from $37.8 billion a year ago. Revenue in North America, where the company makes 60% of its sales, rose on strong sales of pickup trucks and Cadillac-branded vehicles. Sales in China remained strong, as well, but that was not enough to offset weakness elsewhere in GM’s international operations, particularly in South America, where political unrest in Venezuela is pushing down the value of that country’s currency and the contribution of GM’s Venezuelan operations to the company’s total sales....