Welcome to John Ransom's Stocks In The News, where the headline meets the trendline.
Stocks in the News is produced by Ransom Notes Radio and Goodfellow, LLC. Crista Huff manages Goodfellow LLC, a website that recommends outperforming stocks using fundamental and technical analysis.
Stock number one is:
Yahoo! Inc., (SYMBOL: YHOO) and the headline says:
Yahoo’s [CEO Marissa] Mayer Buys Tumblr for $1.1 Billion -- Bloomberg
Yahoo! Inc. will purchase Tumblr in a $1.1 billion all-cash deal. “Tumblr … will continue to host its more than 108 million blogs, while CEO and founder David Karp …will remain in charge of the website, ‘per the agreement and our promise not to screw it up,’ … Yahoo said today..,” reports Bloomberg. Improvements to the Flickr photo-sharing site are also being unveiled today, as Yahoo! aggressively competes with Facebook and Google for users and advertisers.
The acquisition leaves Yahoo! with another $4 billion cash-on-hand. Yahoo’s earnings were previously expected to grow 20% this year. Expect upward revisions to future earnings estimates.
The stock is up 60% since it broke out in October. As we reported last week, we like Yahoo!, and will probably recommend shares after a price correction. Current shareholders should protect profits!
Our Ransom Note trendline says: STAY ON THE SIDELINES.
Stock number two is:
Campbell Soup Company, (SYMBOL: CPB) and the headline says:
Unusually Robust Soup Season Drives First Quarter Upside – Morgan Stanley Research