A Restless Ford Motor Picks New Leader

Ford Motor Company,prodded by anxious shareholders,who have seen rival Tesla Motors overtake Ford in market cap recently,has chosen insider Jim Hackett to replace longtime Ford executive Mark Fields.Ford's executive chairman,Bill Ford,great grandson of company founder Henry Ford,denied that Fields had been fired.They simply sat down together and decided it was time for new leadership,Mr.Ford said.
Mr.Fields had replaced the retiring Alan Mulally,who was credited with shepherding Ford through the Financial Crisis.*
Mr.Hackett,a Ford board member,had been serving as Chairman of Ford Smart Mobility,the unit charged with crafting Ford's response to a changing transportation sector rapidly altered by firms such as Uber,Lyft and Google.Mr.Fields had been CEO for only three years and kept the company profitable,although its core auto manufacturing business has shown lackluster results as of late.*
In a previous position as CEO of office furniture maker Steelcase,Mr.Hackett shifted the company from cubicles to the rising open office format.From 2014-2016,he was interim athletic director at the University of Michigan,bringing on NFL coach Jim Harbaugh and hence restoring Michigan football to competitiveness.Bill Ford noted that:
These are really unprecedented times,and it really requires transformational leadership during these times.*
Ford's first electric SUV won't be ready till 2020.*
Ford Motor Company (F)

Investing in Volatile Times

When you see this level of volatility,you don't get confident;you get nervous,said CNBC host and master investor Jim Cramer.I think oil's going to be lower longer.It isn't going to be positive.*
Do you like something more because billionaire activist investor Carl Icahn's in it?Yes,you do.He's taken a stake in miner Freeport-McMoran.Freeport's run more like a private company.*
One billion users logged into Facebook on Monday 24 August.Social media is the way to go.Who is social media?Google and Facebook.Link with someone who has a lot of followers,and your business goes up.It just works.I look at Facebook and I think,what an unbelievable business.Do thy have to pay the NBA for rights?What a marvelous business model.*
I'm a believer in Disney and its CEO Bob Iger.You do have "Star Wars,"which is very big.You do have theme parks.I'm still a believer in what Bob Iger's doing,Mr.Cramer repeated.*
Freeport-McMoRan (FPT),Facebook (FB),Google (GOOG),Walt Disney (DIS)

What Google Looks For When It Hires

Eric Schmidt,president and former CEO of Google,described the staff there as the best collection of new technologists he had seen in at least a decade,when he came to Google from Novatel.We wrote a plan with new product ideas that would redefine the conversation.You had to build a product that was extraordinarily good and fast catching-on.
You really don't want internecine competition within a company.That wastes resources.The goal is to come up with good idea and get people excited about it,not to reach consensus.The millenials we hire are better prepared,better educated,more collaborative and socially conscious.We provide everything except housing:food,a pet-friendly workplace,breakfast,lunch and dinner.*
My relinquishing the CEO position has been an exceptional transition and very good for everyone.I moved on when I realised that Google founders Larry Page and Sergei Brin had become seasoned industry executives.The Google board has about nine or ten members,a third of them women.*
We look for smart creatives.They must be technical in something,analytically.They must have some business acumen.They have to be curious.We want those with great insights and ideas-even if they're wrong.In every survey,Google is rated the number one place to work for new graduates.Often the best referrals are from colleagues.The top students have a natural interaction with faculty.We want people who are busy.The world changes because people are passionate.This is your identity.It's not a job;it's a calling.
They'll figure it out if you let them.Large corporations tend to operate with a one year time frame.You have to figure out how you are going to deal with new ideas over the next five years.The characteristic today is that new ideas happen faster,Google president Eric Schmidt pointed out.*
Google,Inc(GOOG)

Facebook Absorbs Oculus VR

After buying messaging service WhatsApp and expressing interest in solar drone maker Titan Aerospace,Facebook has announced its intention to acquire virtual reality startup firm Oculus VR,Inc.Facebook has one eye on Internet rivals such as Google,which is well known for its appetite for scooping up startups.
Oculus makes the Oculus Rift virtual reality goggles,which are not currently available commercially.Oculus is soliciting application ideas for the big,bulky headset from software developers in fields such as gaming,film,marketing,architecture,education,design and automotive.An early problem with the goggles has been motion sickness.They are part of the wearable tech trend,which has also spawned Google glass and wristwatch smartphones.
We're making a long-term bet that immersive,virtual and augmented reality will become a part of people's daily life,Facebook CEO Mark Zuckerberg explained in a conference call.Imagine enjoying a courtside seat at a game,studying in a classroom of students and teachers all over the world or consulting with a doctor face-to-face just by putting on goggles in your home,Zuckerberg enthused.
The two billion dollar deal is mostly in Facebook stock,with only 400 million in cash being forked over by the social media titan.*
Facebook(FB),Google(GOOG)

Investing Insights:Twitter,Google and Sony

Twitter as a business is absolutely sensational,said Larry Haverty,portfolio manager at GAMCO Investors.The growth of the global ad revenues are divided by the big three:Facebook,Twitter and LinkedIn.At close to a 40 billion valuation,I can't make Twitter grow fast enough to justify the price.You've created an artificial shortage.This is a hoarding apple,not an investing apple.
There's speculation going on.People are just buying it.It's going to make a lot of money,but with a 40 multiple on it,five years from now I get a stock valuation where it is right now.God forbid something happens to the business like to an AOL and previous speculative companies.Once I see how the numbers look,seeing how the people behave at the conference call,I'll be able to judge it better.I just can't do that right now.*
I would still be a buyer of Google.Right now it's a technological conglomerate.Basically it eats on ad dollars.It's returning 5%.I think Google glass will be a phenomenal success.*
Macau in the next five years is gonna double.*
With Sony,one thing I like is,they're finally figuring out how to make money in the music business.Profits are gonna start going up as these services allow them to start monetising.
The real call option on Sony is the electronics business.Ultra HD TV is gonna be all over the Consumer Electronics Show.Sony is gonna have a seat at the table.Three to five,you have the entertainment business and a turn in the electronics business with PlayStation 4,somebody's gonna make a fair amount of money with Sony.*
In the next few weeks,Liberty Media will buy Time Warner Cable.*
Sony Group(SNY),Twitter(TWTR),Google(GOOG),Time Warner Cable(TWC),Liberty Media Corporation(LMCA)

Should Omnicom Merge With Publicis

Madison Avenue advertising titan Omnicom and France's Publicis have announced their merger,resulting in a firm with a combined worth of just over 35 billion dollars,with more than 130,000 employees.The deal promises to achieve 500 million dollars in cost savings and a combined annual revenue of around 23 billion.The deal could face objections by regulators fearful of the decreased competition in the advertising industry that would result.*Omnicom CEO John Wren will eventually become sole CEO of the combined firm,and Publicis CEO Maurice Levy will be non-executive chairman after a period of being co-CEOs.The new company will be stronger in the emerging markets and better equipped to compete with Google and Facebook in the digital ad realm.Most of the time,Google collaborates with Omnicom,Wren said;sometimes it competes with us.*Omnicom faces a new world.Revenue is slowing down on the difficulty of adjusting to new places where the ads go,Google and Facebook's new way to advertise,according to Julie Roehm,Senior Vice President of Marketing at SAP.The merger makes perfect sense.It's a very good opportunity for them and their customers,taking the inefficiencies to invest them in big data and analytics.Mobile is a huge opportunity.Very few companies have cracked that code.They're going to take traditional creativity and merge it with the digital side.They are representing lots and lots of customers.They want to get ahead of the ball,Ms.Roehm noted.*Omnicom Group Inc(OMC),Publicis Groupe SA(Paris:PUB)

Microsoft's Troubled Road

The declining PC business matters,according to Dan Niles,co-Chief Investment Officer at asset manager AlphaOne Capital Partners.Enterprise is still tied to the PC business.Microsoft missed estimates in all five revenue segments.The problem is,you're gonna have more tablets sold than PCs in Q4. Microsoft is a great cash flow business.It's a software company,but it's on the wrong side of the market.It has a good quarter mixed in here and there.Until they figure out how to have a strong smart phone and tablet,they're on the wrong side of a business transition. Google is in a good spot with Android.Eventually,this mobile transition will run its course.For Microsoft,you need stabilisation in the PC market.In 2-3 years from now,you might reconsider the stock. Mr.Niles,Senior Portfolio Manager of the AlphaOne Satori Fund,has a negative position in both Microsoft and Google. Microsoft is currently undergoing a restructuring,in an attempt to better navigate the shifting business landscape. Microsoft(MSFT),Google(GOOG)

Should You Invest in Microsoft

I think Microsoft will move the office and server business to the cloud,said Rick Sherlund,Managing Director and Director of Technology Research at Nomura Securities,to align internally and focus their business model around the cloud.Their primary competitor in the cloud is Amazon.
It's gonna be important that they deliver higher end software,not just infrastructure.A lot of enterprises run Microsoft,so hopefully you can draw above average margins.
Microsoft Chairman Bill Gates and CEO Steve Ballmer own a little less than 9% of the stock.The stock rallies on restructuring reports.On fundamentals,the stock is pretty uninteresting right now.A lot of it is gonna have to come from increasing shareholder value.
Microsoft owns 10% of privately held Israeli  navigation and traffic report app Waze Ltd,which Google will reportedly purchase for 1.1 billion dollars.Microsoft would receive 100 million for its stake in the app.
Neither Google nor Waze will comment on the prospective deal.
In Monday trading,Microsoft stock closed at 35.47,down 0.56%.
Microsoft(MSFT),Google(GOOG),Amazon(AMZN)

Investing Today:The Promise of the Mega Caps

The biggest bargains right now are the mega caps,said thought leader Joel Greenblatt of Gotham Asset Management.Google has huge cash flow and growing.Over time,it's gonna pay out a lot of money.So is Apple.
We put together portfolios of hundreds of stocks on the short and long side.If you own a bucket of Apples,you're gonna make a lot of money.The company is incredibly cheap right now,trading at only seven times free cash flow.It hides in the market in plain sight.
I can't really tell you if Apple itself is gonna work out,but if you own a bucket of Apple-type bets,you're gonna do very well.
We short about 300 stocks.At the top is JC Penney.It's eating through lots of cash,and it's doing it quickly.History would say this is gonna be a tough one to turn around.If you're gonna short a bucket of JC Penneys,you're gonna make a lot of money.I wish JC Penney well,but the odds are against them.It's possible to turn it around,but it's a tough road.
We're basically underwriting good bets and bad bets.On the straight numbers,Herbal Life is cheap,but we can't trust the numbers,so we don't play.We have no opinion on it.
We're in about the 68th percentile toward cheap.The expected return for large caps is 13-15%.You have to invest someplace.
I'd like to hide in a business that spins out a certain amount of cash every year and can adjust to what's happening in the economy.On average,companies don't spend their cash very well.If they either buy back stock below fair value or increase dividends,it might be better than going out and spending it,Mr.Greenblatt suggested.
Founder of hedge fund company Gotham Capital Management,Joel Greenblatt is the former chairman of Alliant Techsystems and is currently an adjunct professor at Columbia University Graduate School of Business.He holds an MBA from The Wharton School,and is the author of "The Little Book That Beats the Market" and "The Big Secret for the Small Investor:A New Route to Long Term Investment Success."
Google,Inc(GOOG),Apple Computer(AAPL),JC Penney(JCP),Herbal Life(HLF)

Should You Invest in Yahoo

Yahoo beat Wall Street expectations for both profit and overall sales in Q4,with a roughly 4% gain in sales.Display ads alone brought in 520 million dollars in revenue,which was down 10% on the year;but search revenue was 427 million,up from 376 million a year ago.
Eric Jackson of Ironfire Capital said Yahoo is gonna be the AOL of 2013.I think Yahoo has really been trucking along nicely.This year,there is a possible sale of Yahoo's stake in China's Alibaba.com,plus the monetisation of Yahoo Japan.
Marissa Mayer,Yahoo's fifth CEO in four years,is clearly focused on mobile,but it will take years.They're gonna focus on small acquisitions-companies with 50 employees or less whom they can partner with.Yahoo can actually partner with anyone-even Apple or Google.
Ms.Mayer,37,who had been one of Google's founding employees, is a genuine star of the business world.She's injected some dynamism into a company Wall Street had all but given up on.
Yahoo shares are at a three year high.Stifel Nicolaus raised the stock from a hold to a buy Monday.Yahoo closed flat at 19.34 in Monday after hours trading.
Yahoo Inc(YHOO)

Should You Buy Apple Stock

There's a question as to whether Apple is still innovative enough.Daniel Ernst of Hudson Square Research says Apple is growing revenues 60%,with a 2% dividend yield.It's probably the fastest growing company in technology today.The recent Apple announcements show an improvement in their ecosystem.They significantly raised the bar for their competitors.Now Apple's Siri  feature,the digital assistant and knowledge navigator built into the iPhone 4S,can find information that's not on the web,which Google can't.Apple is also updating the Macintosh computer line.
Investors are fixated on the next big thing,but these things tend to run in cycles,Mr.Ernst points out.Hudson Square has a 700 dollar price target on Apple,with a buy recommendation.
Hudson Square Research serves institutional clients with fundamental equity research,assessing valuation,risk and opportunity.Based in New York,they focus on the technology,media,telecom and consumer sectors.The company was founded in 2004.
Apple(AAPL)

Tech Trends:Google Exec Predicts Cheaper Smart Phones

Eric Schmidt,the software engineer who is Google's Executive Chairman,remains the public face of the company after having left the CEO role.His wide-ranging thoughts are heard
everywhere from the halls of Congress to the World Economic Forum that was just held in Davos,Switzerland.
Everything feels sluggish because there's not enough demand,Mr.Schmidt remarked in Davos,but the Internet continues to win advertising,which is less expensive on it.We haven't seen the slowness as hard as others.
Phones that are powerful will go down in price to 60-70 dollars for a billion people.People outside the Western world will rely on mobile phones in fundamental ways because they don't have access to TV and libraries.
We at Google love advertising and we innovate in many ways in it.We're coming up with new ways to make sure your advertising money is well spent.
In the cloud,you don't have to use email to collaborate.People need service and support,and applications can be built on top of it even if it's free.If 100 million people use it,you can make money from it,Eric Schmidt asserted.
Google's Q4 earnings were below estimates,causing the share price to drop 57 dollars.Wells Fargo downgraded the firm from outperform to market perform.
Google,Inc.(GOOG)

Inside Google's Good Quarter

Google beat its earnings consensus by 11%.Sales rose 37%,and they remain the search market leader.Android search is growing.Google+ has 40 million users.The company continued its robust hiring,generating controversy with the expense of adding 8.2% to its headcount.
According to analyst Gene Munster of Piper Jaffray,the core search business is doing well.The display business is also still doing well.Our price target's gonna be going up.There is some risk in terms of Europe,but the growth in Android is positive for our price target.Android handsets were a huge drive for clicks.
You've got to give them credit:a 13 year-old company hitting those metrics.There could be some big surprises with the MMI acquisition affecting capital expenditures,but there are broader positives for the advertising business,Mr.Munster indicated.
Google(GOOG)

Investing Today:Strategies For a Choppy Period

According to Stephen Wood,PhD,chief market strategist at Russell Investments,what we're looking at is a square root sign,a market plateauing at a lower rate of growth.It's probably a significant slow patch in the overall recovery.This is not terribly surprising.
There are gonna be choppy markets.Consider Japan,the Middle East,the Greek debt issue-a lot of headlines could cause volatility.
You're probably in a lower return environment.A portfolio should be globally diversified and have more equities,commodities and infrastructure.
Dr.Wood likes JP Morgan Chase.It has a 2.40 yield and is an industry leader,coming through the financial crisis extremely well.It has a strong balance sheet and is a good,old-fashioned consumer bank.
He also favors Pfizer.The economy's gonna do O.K.,but not spectacularly.Pfizer levels the volatility.People stay in it longer.People are gonna have to ride out the volatility with a more disciplined long term time horizon.
As for Google,longer term,it's probably gonna be a name that's the 500-pound gorilla in its space,Stephen Wood believes.
Stephen Wood has been with Russell Investments since 2005.He has conducted research on the economy,capital markets,portfolio strategies and investor behavior,also serving as a commentator on those topics.In addition,Dr.Wood has worked with institutional clients and retail partners to explain Russell's investment process and portfolio management.
JP Morgan Chase(JPM),Pfizer(PFE),Google(GOOG)

Google Criticized For Spendthrift Ways

Google had good sales in Q1,but its earnings,or profitability,missed estimates.Paid clicks were up 18% for the quarter.The company took on an increase in operating expenses,however,as it invested in many initiatives,generating employee and advertising costs.
Google has long been known for its prolific hiring.Critics assert it is spending too much money.
It's very important for new CEO Larry Page,the company's co-founder,to assert his leadership now,says Joel Abramowicz,senior vice president and tech analyst at Blaylock Robert Van,who has a hold rating on the stock.They're in a very strong position in the coupon area.They already have a sales force in place.
They're a phenomenal software company with great understanding,but it's a very complex business model.It's hard to correlate their platforms as to productivity,Mr.Abramowicz feels.
Eric Schmidt recently turned over the executive reins at Google to Mr.Page,who co-founded the company with fellow Stanford University scholar Sergei Brin.The mega-firm was incorporated in 1998 and was publicly listed in 2004.More than a million servers are involved in Google's operations.
The stock tumbled on disappointment with the Q1 earnings report.
Google(GOOG)

Google's Size Problem

Google is the largest of the large,which makes trouble for the tech titan.You will have competitors complaining about Google,points out Harry First,Professor of Law at New York University and former head of the New York state anti-trust bureau.There is always the fear they're doing that to thwart a better competitor.This clearly is a concern for Google.
Google does have some monopoly power.You can build a successful business and continue to build it as long as you do it properly.They just can't exclude competitors.
Ohio,Wisconsin and Texas are questioning Google.States may take Google to court.These states try to incentivize the federal government to do so as well.
Google is a very aggressive company.Clearly it's in the hot seat all over the world.They reach out and try to explain what they're doing,Professor First noted.
Google's attorneys have been busy in Europe,trying to fend off accusations by Microsoft and others that they have an unfair lead in search advertising.If the accusations get to a formal investigative stage,it may be difficult to stop the case,since the authorities then have a vested interest in achieving something with it,justifying the expense of the investigation.
Google(GOOG),Microsoft(MSFT)

Texas Instruments,Intel Upgraded

Texas Instruments has been upgraded to overweight from neutral by JP Morgan.It has a new price target of 47.00.The upgrade stems from the impending end to the semiconductor inventory correction.
RW Baird has raised Intel from neutral to outperform.The price target has been raised from 25.00 to 27.00.The upgrade is because of continued rebounds in demand for Intel's products.Wells Fargo seconds this view of Intel.
Meanwhile,outside the semi space,Google continues to look for acquisitions.These are to be small,innovative firms along the lines of last year's purchases.
Texas Instruments(TXN),Intel Corporation(INTC),Google(GOOG)

Tech Founder's Vision:From Netscape to the Cloud

Marc Andreesen,co-founder of the early Internet firm Netscape,notes that everyone thinks we're in a tech bubble,which means we must not be.I don't think we've seen the innovators yet,let alone the idiots.
The industry rewards ingenuity,aggressiveness,innovation.The successful are successful because they are so good at innovation.
In the last five years,500 million people have switched browsers.We're basically reinventing browsers around the services people like to use,such as Facebook.
Cloud computing means moving out into the Internet,using Gmail and Google documents instead of Microsoft Outlook.It's a very big architecture change,with matching companies springing up.
There are more than two billion people on the Internet.I think the perception of tech has caught up to the reality.
Marc Andreesen co-founded Netscape with Jim Clark,being one of the inventors of the browser that became Netscape.Today,Netscape is a holding company of AOL,consisting of a web browser,discount Internet service provider and popular social news website.Netscape moved from Mountain View,California to Dulles,Virginia.
AOL,Inc.(AOL),Google(GOOG),Microsoft(MSFT)

Focus On Tech:Google and Yahoo

Hudson Square Research has a buy rating on Google,with a price target of 750 dollars.Google has a very strong core business,says Rory Maher of Hudson Square-plus mobile and display assets.They have a lot of cash to buy fast-growing Inet companies.
Mobile search is starting to boost Google's sales.Hudson Square is excited about Google's Android operating system.They think it's gonna gain a majority share in mobile search.
Yahoo also has a buy rating.Hudson Square is pretty bullish on Inet media overall.Yahoo owns a bunch of ecommerce companies in China that are about to be profitable.Hudson Square is also pretty excited about Yahoo as a stand-alone company,and is pretty confident in the shift of traditional ad dollars to online,which will benefit both Google and Yahoo.
The biggest risk for both is Facebook stealing ad dollars.All will benefit from the shift to online;it's a question of who steals ad dollars from within the sector,Rory Maher believes.
Hudson Square Research is an institutional equity research boutique focused on the tech,media,telecom and consumer sectors.They provide institutional investors with fundamnetal equity research to assess valuation,risk and opportunity.
Google(GOOG),Yahoo(YHOO)

Ballmer's Search View

Steve Ballmer,CEO of Microsoft,expressed his vision of the search world at the recent SMX event in Santa Clara,California.Google got to search first,Mr.Ballmer admitted.There's a value to incumbency.The truth is,we do have an ambition to grow.I guarantee you,search is gonna be an ever-growing share of Microsoft's profits.
The dynamics of business model competition are fascinating,Mr.Ballmer believes.There are a whole set of innovations still to come around business models.We've got seven or eight big businesses,plus a lot of our customers.I'm generally working on things that are in an intersection.We've got great people actually driving the search team.They have really improved,and there's always a new frontier.
We have a great partnership with Twitter.Whether we need to own the company or not I think is less clear.I'm more of a consumer than an author when it comes to the real time type of service such as Twitter.Facebook wants to be an independent company.A great collaboration would be best both for the searcher and for us,Mr.Ballmer said,wearing a burgundy sweatshirt over his blue button down.
We've got a lot of great stuff in the user experience.We've got to consolidate and drive taking action.We want to make sure we take care of the breadth of our experience in different countries over the next couple of years.The biggest opportunity in search is really helping people get done what they're trying to get done.It shouldn't be that hard to call up data.I'd like data assembled for me.We're all gonna have to go further and further down that path,the Microsoft CEO observed.