BloggingStocks

Another major flaw in Starbucks (SBUX) management

Douglas McIntyre — 2008-07-04T06:59:00+00:00

Filed under: Forecasts, Management, Starbucks (SBUX)

In a brilliant article in The New York Times, the paper points out that of all the mistakes that Starbucks Corp. (NASDAQ: SBUX) made in its expansion, picking real estate locations may have been the worst. Much of the analysis for the piece came from talking to real estate brokers. The paper writes, "In some cases, brokers say, Starbucks misjudged the risks of putting stores close to each other, leading to the decline in same-store sales."

It is astonishing that Starbucks would make such basic errors and speaks to what happened to management during the period when founder Howard Schultz was absent from the CEO job. The team that replaced him said it believed the company would eventually have 40,000 store worldwide. It clearly cut corners in terms of planning to get there.

The real trouble with the real estate location decisions is that it may take a very long time to fix. Closing stores may be easy, but finding better spots, negotiated for the space, and building out new stores will be time consuming and, perhaps, expensive.

Schultz and his minions are paying for rampant growth, and the poor souls who worked for him are paying more. Almost 12,000 will lose their jobs.

Douglas A. McIntyre is an editor at 247wallst.com.

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Starbucks: The next McDonald's

Georges Yared — 2008-07-03T16:31:00+00:00

Filed under: Forecasts, Consumer experience, Competitive strategy, Starbucks (SBUX), McDonald's (MCD), Stocks to Buy

I'll admit the headline is a bit deceptive. On one hand McDonald's (NYSE: MCD) has seen a resurgence in its business and frankly, the shares have done very well. In fact since McDonald's went through its own set of problems five years ago, the stock has since tripled in value.

The parallels between Starbucks (NASDAQ: SBUX) and McDonald's are very eerie. Starbucks has hit the proverbial wall after a successful ride from 1992 to 2007 as one of the premier GameChanger stocks around. Starbucks, like McDonald's over-expanded its store base in the United States and began to cannibalize its own revenues. Starbucks, like McDonald's, lost its principle focus and did not tend to 'what got them there".

In late 2002 McDonald's stock had just finished a 4 year run of losing 70% of its value. The company was becoming a hodgepodge of different menu items, culminating with the disastrous release of the McLean Deluxe, which was not even all beef! Advertising and marketing programs were a mish-mash of geographical themes yielding no consistency whatsoever. McDonald's even posted, for the first time in its illustrious history, an operating loss in 2002, and experienced negative same store sales for the first time, as well.

Then CEO Jim Cantalupo said enough was enough. McDonald's closed 700 unproductive stores (sound familiar?) and re-focused its menu and advertising campaign.

This is when the advent of "I'm Lovin It" went global -- yes, even in France! Unproductive stores closed and the rest of the survivors received a major face lift, including new kitchen equipment, new seating plans, fresh exteriors and even wide-screen TVs strategically placed for customer viewing and comfort. The menu went back to basics, eliminated the Super Size failure and introduced entree-size salads and other healthier alternatives. As I said, the stock has tripled since.

Starbucks has hit the wall. Sloppy execution, too many units, confusing menu, etc. Returning founder and now CEO Howard Schultz has now said "enough is enough." He is closing 600 unproductive units, re-training partners to the core founding principles and choosing to spend the company's expansion capital overseas where the true growth lies.

Starbucks has also experienced, painfully, negative same store sales. The stock is at a low point, as was McDonald's in early 2003. Can Starbucks stock triple over the next five years? Yes. With back-to-basics execution, expense control and controlled unit growth, Starbucks can elevate its value over the next five years. The good news for Starbucks is the competition remains on a regional basis and no one competitor is set to go national or even global. The early advantage still belongs to Starbucks. If Howard Schultz and the management team can re-set the bar, the stock is a screaming buy for patient investors. The full results of the June quarter are not out yet, nor will they be pretty. But, it's priced into the stock already.

History does have a way of repeating itself ...

Georges Yared is the editor of GameOn Investing, a free service devoted to investors spot GameChanging stocks before they break out.

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Closing Bell: DJIA 11,000 or 10,000 is closer rather than farther

Jon Ogg — 2008-07-02T16:24:00+00:00

Filed under: After the bell, Starbucks (SBUX), General Motors (GM), Lehman Br Holdings (LEH)

After a brief refreshment, today just ended up being ugly rather than what many were hoping would be a boring day. Today's action was likely due more to analyst concerns, but a late-day news report on a security breach scare at LAX airport may have added stress to a trading day that would have otherwise been quiet. The markets are grossly oversold, but there just seems to be very few reasons for traders to hit their "BUY" buttons on keyboards.

These are UNOFFICIAL closing bell levels for major index readings:

DJIA 11,218.77 (-163.49)
S&P500 1262.24 (-22.67)
NASDAQ 2251.46 (-53.51)
10 YR T-Note 2.959% (-0.033%)
52-WEEK LOWS
Top 10 Analyst Calls

General Motors (NYSE: GM) was the daily disaster due analyst call. Merrill Lynch downgraded the stock to Underperform and noted that "the chances of bankruptcy aren't impossible." 24/7 Wall St. noted the same weeks before, and we even posted odds on what the chances are that major auto or airline companies would have to file for protection by the end of 2008 to early 2009.

Lehman Brothers (NYSE: LEH) said that it was granting options with under-market strikes to employees of 20% of last year's salary to retain talent. This "golden handcuffs" strategy led many to believe that this means no major severe weak buyout offer like a Bear Stearns scenario is underway. Shares were up almost 7% at $22.39 in today's final minutes.

Starbucks Corp. (NASDAQ: SBUX) was a mixed bag as shares were up marginally at $15.66 in the final minutes after the company disclosed last night that it would slow down growth and expand its store closings this year. This was big enough that S&P put the company on Negative CreditWatch.

UnitedHealth Group Inc. (NYSE: UNH) issued an earnings warning, but shares held up better than you'd expect because valuations are getting so low. Shares were down about 1.7% at $25.20 in very final minute trading.

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Brand name stocks under $10 to beware of, market themes for 2008's second half - Today in Money 7/2

Allan Halprin — 2008-07-02T08:59:00+00:00

Filed under: Microsoft (MSFT), Yahoo! (YHOO), Starbucks (SBUX), Ford Motor (F), General Motors (GM), Motorola (MOT), Toyota Motor Corp. (TM), Netflix, Inc. (NFLX), Citigroup Inc. (C), Sprint Nextel Corp (S), Blockbuster Inc 'A' (BBI), Money and Finance Today, Bank of America (BAC), Circuit City Stores (CC), Palm Inc (PALM), UAL Corp (UAUA), Crocs Inc (CROX), Qwest Communications Intl (Q), Rite Aid Corp (RAD)

In the News:

· Car Sales Hit 10-Year Low as June Was Bleak Month; GM Dropped 18%, Toyota 21%

· Microsoft May Take Another Stab at Yahoo

· Starbucks to Close 600 Stores

· Blockbuster Ends Pursuit of Circuit City

· Bank of America Closes Countrywide Acquisition; More Misery Ahead for BofA?

· Citibank ATM Breach Reveals PIN Security Problems

· Deepening Cycle of Job Loss Seen Lasting Well Into 2009

· Netflix Stars in a Slow Economy

· Manhattan Real Estate Finally Starts to Soften

Brand-Name Stocks Uner $10: Buyer Beware
These well-known names in the bargain bin may look appealing, but experts advise laying off until their earnings picture is clear. Among the stocks to be weary of are Sprint Nextel, Motorola, Ford Motor, Qwest, Washington Mutual, Northwest Airlines, Del Monte, Rite Aid, Chico's, Crocs, United Airlines, Palm, Sealy, Blockbuster, Circuit City and Orbitz.
Brand-Name Stocks Under $10: Buyer Beware

How to Play the Market in the Second Half of 2008
Market pro Todd Harrison discusses the top 10 themes for the rest of the year.
Where we are and where we're going: 10 market themes - MarketWatch

Finding Safety in a Bear Market
Here are five ways to protect your portfolio.
Keeping Your Balance in a Scary Market - Kiplinger.com

Airports Cash in on Flight Delays
Your delayed flight is bad news for you and your airline, but it's money in the bank for the airports who are turning into multi-billion dollar shopping malls for stranded passengers.
Delayed flights mean big money for airport industry - CNNmoney

Meet the New King of Brand Names
The CEO of Fortune 500 newcomer Jarden Corp. is busy reviving old brands, but Wall Street has its doubts. Meet Martin Franklin who is snapping up undernourished brands and give them a shot in the arm. His company now markets more than 100 brands - among them Sunbeam, Oster, Rawlings, K2, Hoyle, Mr. Coffee, Crock Pot, and First Alert - and is the market leader in such retail categories as kitchen electronics, playing cards, tents, and grill-gas canisters.
The new king of brand names - FORTUNE

How to Protect Yourself If a Store Goes Bankrupt
When furniture seller Levitz closed last fall, its Web site informed customers that they might not receive ordered merchandise, that there would be no more returns or exchanges, and that some paid-for extended warranties would not be provided. With tough times forcing Levitz and other retailers-including Sharper Image, Linens 'n Things, and Lillian Vernon-to file for bankruptcy protection, it's wise for shoppers to take precautions. Here's how.
ConsumerReports.org - Protect yourself if a store goes bankrupt

How American is American Apparel?
CEO Dov Charney has Canadian passport, extraordinary business acumen and social grace of a subway flasher.
Minyanville - NEWS & VIEWS-How American is American Apparel?

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Option Update: Starbucks volatility flat into 600 store closings

Paul Foster — 2008-07-02T08:12:00+00:00

Filed under: Starbucks (SBUX), McDonald's (MCD), Options

Starbucks (NASDAQ: SBUX) indicated plans to close 600 unprofitable domestic stores and incur pre-tax charges of $328-$348 million, including asset write-downs of $200 million.

Deutsche Bank says: "With US consumers still reeling and McDonalds (NYSE: MCD) on the cusp of a nationwide specialty coffee rollout, it is too early to call a bottom on fundamentals - maintain Hold."

SBUX July option implied volatility of 42 is near its 26-week average of 39 according to Track Data, suggesting non-directional price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

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Before the bell: Futures higher on SBUX, YHOO, ahead of inventory report

Melly Alazraki — 2008-07-02T07:46:00+00:00

Filed under: Before the bell, Earnings reports, Microsoft (MSFT), Yahoo! (YHOO), Time Warner (TWX), Starbucks (SBUX), Blockbuster Inc 'A' (BBI), Circuit City Stores (CC), Economic data, Oil

U.S. stock futures were higher Wednesday morning, as Wall Street could try to having yet another positive session. While Starbucks news of store closing and reports Microsoft may still be interested in Yahoo helped lift sentiment, UnitedHealth already issued a warning this morning. Employment data is also on tap before the market opens.

U.S. stocks finally ended higher on Tuesday. Surprisingly, it was car sales that helped the mood on the Street as as June sales came in not as bad as expected. The Dow industrials ended 32 points higher, or 0.28%, the S&P 500 added 4 points, or 0.38%, and the Nasdaq Composite added 11 points, or 0.52%.

Today, investors will have the ADP June private sector employment figures to chew on ahead of the government's report tomorrow. The employment report is expected to be released at 8:15 a.m. EDT. Then, at 10 a.m., May factory orders are due out.

Also on the docket today is weekly crude inventories, usually released at 10:30 a.m. EDT. While oil came off highs Tuesday due to a slightly stronger dollar, it again rose above $141 a barrel Wednesday, due to persistent supply concerns that has analysts warning of higher prices yet. An IEA report saying supplies will remain tight and demand will likely grow despite higher prices helped push prices higher.

In corporate news, Blockbuster Inc. (NYSE: BBI) said Tuesday it is withdrawing its proposal to buy Cicuit City Stores Inc. (NYSE: CC). BBI shares are 13% higher in premarket trading, CC's 7.8% lower.

UnitedHealth Group (NYSE: UNH) cut its 2008 financial outlook as it felt the impact of changing business trends during the second quarter.

Meanwhile, The Wall Street Journal reported that Microsoft (NASDAQ: MSFT) turned to other media companies such as Time Warner (NYSE: TWX) to join forces in buying Yahoo! (NASDAQ: YHOO). Apparently, Microsoft want Yahoo's search business, but could do without its content portal business, which another company could pick up. YHOO shares are up nearly 5.5% in premarket trading.

Finally, Starbucks (NASDAQ: SBUX) said it plans to close 600 stores, or about 8.5% of its total stores. While the turnaround strategy still has to prove itself, SBUX stock has been trading over 6.6% in premarket action on the news.

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Starbucks: Will store closings lift company's fortunes?

Sarah Gilbert — 2008-07-02T02:06:00+00:00

Filed under: Consumer experience, Rants and raves, Competitive strategy, Starbucks (SBUX)

I hemmed and hawed when I saw Jennifer Openshaw's piece on MarketWatch a few weeks ago; her opinion was that Starbucks (NASDAQ: SBUX) would recover much of its lost value in these past several months of sluggish sales, rising milk costs and slipping coolness, no matter what the naysayers, say. Her argument: that Starbucks was great because of its atmosphere and general quality standards in coffee. While I certainly agree that Starbucks is still an attractive "third place" and would pick Pike Place brew every time over McDonald's or Dunkin Donuts coffee, I hesitated. Had management already made too many mis-steps? Had hubris got the best of the 'Bucks?

The latest news; that Starbucks management has plans to close 600 stores in the U.S. this year; could be an indication of positive things in the company's stock price. It certainly had traders in after-hours activity eagerly snapping up shares, sending 72 cents, or 4.6%, to $16.34 around 2 a.m. I'm always leery, though, of a huge strategy reversal such as this. In my analysis of Starbucks' financial statements, the company spends about $300,000 to start a new store, and this is largely funded through cash. Management regularly offers old furniture and equipment to its high-ranking employees when upgrading or shutting down a store, so it's unlikely that much of the cost will be recouped. Doug McIntyre noted further that Starbucks will continue to pay more millions in lease costs; the company is known for locking up prime real estate with serious long-term lease agreements. Sure, the loss won't affect the cash balance much, and the charge will be "one-time," so the financial picture will still look rosy in a year when the charge has dropped into "historical financial statements." Investors don't look back.

But by acknowledging that some $180 million in costs, not to mention the hundreds of millions probably spent to train and employ staff at these locations, was a big waste of money, Starbucks management is owning up to a future of slow growth.The golden (or greenish?) child of the late 90s, the one who could never miss a month of rising same-store sales, that Starbucks has gone. In its place is a mature retail company who got way too excited about its plans for world domination, what with music studios and movie promotions and a whole line of children's products (now wiped from the shelves) and its own recipe cards and, what is this, Boogie Nights or Sesame Street or The Food Network? Starbucks hasn't known who it is for the past five years.

Has Starbucks now finally picked its major? Not the ubiquitous Starbucks-on-every-corner, not the omni-cultural center, not the indoor play park, not Bed Bath and Beyond -- no, the coffee shop where you go to meet everyone. Starbucks has always got all A's in atmosphere. It's got to hit the books on good coffee and consistency and friendly staff to win its customers back; but it's got to somehow return to the achievement of speedy profit margin growth to win its investor fan club back. And that doesn't seem likely in a climate of rising food prices and regular American coffee lovers who are giving up lattes to make up for the ever-shrinking wallet.

At this price, the stock looks cheap; market capitalization is about 1.2 times revenue, and the P/E ratio is around 17x. I'll bet we have further down to go, though, when Wall Street starts counting up the losses and when Starbucks management starts offering up a guess at some future numbers.

I believe in the brand loyalty as much as Jennifer Openshaw does, but I'm skeptical about whether Schultz will keep a solid handle on the company's strategy over the next 10 years. I see bigger bargains in my foodie stock universe (like Whole Foods Market (NASDAQ: WFMI), for one) and, while I'm not selling Starbucks today, I'm also not buying.

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Starbucks to close 600 stores

Peter Cohan — 2008-07-01T17:40:00+00:00

Filed under: Starbucks (SBUX), Starwood Hotels Worldwide (HOT)

MSNBC reports that Starbucks (NASDAQ: SBUX) is closing 600 stores. The closings could eliminate as many as 12,000 jobs -- this is 7 percent of Starbucks' global workforce.

The move isn't that surprising given Starbucks' recent weaker-than-hoped sales. But, still, it is a big change from its famous strategy of opening stores lots of stores, many in close proximity to each other. "Starbucks, known for sometimes going so far as to open stores across the street from one another, has recently acknowledged that it may have lost some of its luster during a long period of rapid store openings and expansion into everything from breakfast sandwiches to movie promotions," writes senior writer Allison Linn.

Starbucks will take an after tax write-down of between $328 million and $348 million related to the store closings. But because of tax benefits, it expects to see total cash outflow of about $100 million. Starbucks stock is up 6.5% in after hours trading.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in Starbucks securities.

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Smart bond plays, retiring on a shoestring & top kitchen values - Today in Money 7/1

Allan Halprin — 2008-07-01T08:59:00+00:00

Filed under: Microsoft (MSFT), eBay (EBAY), Starbucks (SBUX), Ford Motor (F), General Motors (GM), XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI), Money and Finance Today, Anheuser-Busch Cos (BUD), Countrywide Financial (CFC), United Parcel'B' (UPS)

In the News:

· Stocks Look Weak at Start of First Day of 3Q

· EBay Ordered to Pay Louis Vuitton, Fendi & Others Millions for Knockoff Sales

· InBev to Continue Pursuit of Anheuser-Busch

· Florida Sues Countrywide Over Mortgages

· General Motors Stock Hits 54-Year Low

· Wilbur Ross Says Run-Up in Oil Prices Is a Bubble

· UPS Pilot Rescues Debilitated Farmers

· Microsoft's Plan B for Search

· Starbucks Makeover Isn't Going Well

· Could a Ford, Chrysler Merger Be in the Making?

· Cable, Satellite Customer Satisfaction Falls, Poll Finds

· Howard Stern May Have a Sirius Dilemma As Company Looks to Cut Costs

Bonds: Smarter Plays for Darker Days
Thinking of Treasuries or other fixed-income plays as the stock market sinks? Here's what to look for.
Bonds: Smarter Plays for Darker Days - BusinessWeek

Who's Minting the Most Millionaires? Not the U.S.A.
A new survey finds when it comes to minting the wealthy, India and China now outpace the U.S. which isn't even in the top 10 anymore. Other countries also outpacing America include Brazil, Korea, Indonesia, Slovakia, Singapore, UAE, Czech Republic and Russia.
A Millionaire Boom In The East - Forbes.com

How to Retire on a Shoestring
You often have to be a little frugal to make a retirement budget work. The $27,798 median income for American households headed by someone 65 or older doesn't offer much breathing room when gas, groceries, and out-of-pocket healthcare costs all are conspiring to make retirement more difficult. Here are eight ways to stretch your retirement dollars.
8 Ways to Stretch Your Retirement Dollars - US News and World Report
In the News: Retirees Downsizing Their Dreams

Top Kitchen Values
You can create a great kitchen by following advice from Consumer Reports' experts and from 8,000 readers who told us about their remodeling projects. Plus, seven mini makeovers for less than $5,000.
ConsumerReports.org - Kitchen values: secrets of a successful remodel

Best Light Ice Creams
Fat might be bad for you, but it sure tastes good. Consumer Reports sampled 10 light ice creams, and even among these more healthful options, the two with the most fat and calories were the winners in our best light ice creams ratings.
ConsumerReports.org - Best light ice creams

Top Airport Bars
The good news in travel? It's easier than ever to drown your sorrows at the airport with a nice glass of wine, an artisan beer, or a good cocktail. Here are a host of upscale new drinking establishments which means business travelers no longer have to languish at dreary, dingy airport bars.
Booze at Airports - Business Travel Column - Joe Brancatelli - Seat 2B - Portfolio.com

Strategic Flying Maneuvers
Major airlines are reinstating minimum-stay requirements. Here's how to get around them.
Getting Around Airlines' New Minimum-Stay Requirements - SmartMoney

Secrets of a Millionaire Matchmaker, For Free!
Men hate short hair," says Patti Stanger, CEO and owner of The Millionaire's Club, and star of the hit Bravo series The Millionaire Matchmaker. Oh yeah, apparently women are not too fond of small-time earners, either. What do you mean you don't have $50,000 to get your dating life going? Well, at least MainStreet has some secrets from the Millionaire Matchmaker free of charge.
The Secrets of The Millionaire Matchmaker, For Free! | MainStreet

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Starbucks' (SBUX) new coffee stirs debate

Douglas McIntyre — 2008-07-01T04:10:00+00:00

Filed under: Before the bell, Launches, Competitive strategy, Starbucks (SBUX)

Starbucks (NASDAQ: SBUX) recently began very wide distribution of Pike Place Roast. It tastes more like the coffee most people brew at home. It is inexpensive. It has drawn new customers to the coffee retailer.

And some people think it tastes like sewage.

According to The Wall Street Journal, "the new strategy, which played down the company's more-established robust roasts, has touched off a debate about what customers think Starbucks should stand for: bold coffee for connoisseurs or a tamer brew for the masses?"

Starbucks founder Howard Schultz has been concerned about bringing the company back to it roots, the look and intimate feel of the company's early stores, but the new drink seems to run counter to that.

The Pikes Place product says much about what is wrong with Starbucks. Its appeal has been the originality of its products, but it needs coffee that will help its sales, which have been weak, grow again. Starbucks seems to be of two minds, which is never good for a company working on turning itself around.

With the economy in the dumps, what Starbucks does may not matter for now. Traffic is being hurt by consumer spending. The shares in the company are way down. Pike Place is just another cup of coffee.

Douglas A. McIntyre is an editor at 247wallst.com.

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Starbucks (SBUX) closes Puerto Rico locations

Brent Archer — 2008-06-30T13:07:00+00:00

Filed under: Bad news, Starbucks (SBUX), Options, Technical Analysis

Starbucks (NASDAQ: SBUX) shares are falling today after the company announced over the weekend that it will close three of its stores in San Juan, Puerto Rico, admitting that economic times are tough and that perhaps the stores were too close to other Starbucks locations (Gee, you think so?). This might not be the worst thing in the world for the brand if it closes down some locations if it over-expanded, but at the same time, if customers don't come back, we could be seeing the beginnings of another Krispy Kreme (NYSE: KKD) situation. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on SBUX.

After hitting a one-year high of $28.60 in August, the stock hit a one-year low of $15.39 in April. This morning, SBUX opened at $16.19. So far today the stock has hit a low of $15.89 and a high of $16.33. As of 12:30, SBUX is trading at $16.24, down 11 cents(-0.7%). The chart for SBUX looks bullish but deteriorating, while S&P gives the stock its highest 5 STARS (out of 5) strong buy rating.

For a bearish hedged play on this stock, I would consider an October bear-call credit spread above the $20 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 11.1% return in three and a half months as long as SBUX is below $20 at October expiration. SBUX would have to rise by more than 23% before we would start to lose money. Learn more about this type of trade here.

SBUX hasn't been above $20 since January and has shown resistance around $17 recently. This trade could be risky if the company's earnings are a positive surprise, but even if that happens, this position could be protected by resistance SBUX might find at its 200 day moving average, which is currently around $20 and falling.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in SBUX.

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Will Bill Gates have to un-retire from Microsoft?

Jonathan Berr — 2008-06-27T12:38:00+00:00

Filed under: Management, Google (GOOG), Dell (DELL), Starbucks (SBUX), International Business Machines (IBM)

Microsoft Corp. (NASDAQ: MSFT) co-founder Bill Gates is riding off into the sunset today, at least he sort of is. The man who made nerds and geeks "cool" is shifting his focus away from the world's largest software company to his philanthropic work.

Gates contributions to modern society cannot be understated. When he gets older, my 20-month-old son will no doubt be surprised to learn that there was a time when computers were expensive, impersonal devices the size of several refrigerators. Gates helped make the computer personal. Of that there is no doubt. How he did it remains open to debate. The elite geeks despise Microsoft for developing expensive, inferior operating systems that are prone to crashes and computer viruses.

The shift by Gates, which has been expected for some time, comes as the Redmond, Washington-based company is at a crossroads. Back in the 1970s and 1980s, Microsoft was the underdog that upended the tech establishment lead by International Business Machines Corp. (NYSE: IBM).

This time, Microsoft finds itself in the role of Big Blue and Google Inc. (NASDAQ: GOOG) has taken on the Microsoft role. Google is trying to pry open Microsoft's lock on the desktop by offering services that the software company sells for big profits such as e-mail and spreadsheets for free. Microsoft also has tried and failed to make a dent in Google's share of the search market.

Will Gates stay retired? I am sure that the good works of The Bill and Melinda Gates Foundation will keep him busy. But other CEOs such as Michael Dell from Dell Inc. (NASDAQ: DELL) and Starbucks Corp (NASDAQ: SBUX)'s Howard Schultz have tried to walk away from the companies they have founded only to wind up running them again. Shares of Microsoft are down more than 20% this year. Some on Wall Street think the company's best days are behind it.

Gates, of course, is well aware of all of this.

He may be non-executive chairman but he also remains a huge Microsoft shareholder. If things don't improve over the next few years, Gates may wind up taking his old job back and putting his charity work on hold.

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Google tops reputation survey

Douglas McIntyre — 2008-06-23T09:30:00+00:00

Filed under: Consumer experience, Google (GOOG), Microsoft (MSFT), General Electric (GE), Starbucks (SBUX)

Reputation surveys are usually beauty contests based on consumers' vague feelings about companies that they know or do business with. That makes them relatively useless.

Still, one poll has created news by putting Google (NASDAQ: GOOG) on top of its list. Whether that will translate into more profits or a better stock price is open to debate.

The Harris Interactive Reputation Quotient poll put Google in first place, replacing Microsoft (NASDAQ: MSFT) and dropping it to 10th place. Reuters writes that the polling firm said "They [Google] absolutely get tremendous credit for the social responsibility, which for them is also linked with their vision and leadership." Google's treatment of its work force was also a big factor.

Getting onto these lists probably does not mean much. The Fortune "Most Admired Companies" survey includes Starbucks (NASDAQ: SBUX) and GE (NYSE: GE). Both companies have had troubles in their operations and have missed earnings estimates. Their stocks have sold off sharply.

Google may want to see if it can tone down its reputation. That may be better for shareholders.

Douglas A. McIntyre is an editor at 247wallst.com.

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Favorite farm stocks, millions more could get rebate check & downtowns in danger - Today in Money 6/20

Allan Halprin — 2008-06-20T08:43:00+00:00

Filed under: Yahoo! (YHOO), Starbucks (SBUX), General Motors (GM), Money and Finance Today, Archer-Daniels-Midland (ADM), Contl Airlines'B' (CAL), UAL Corp (UAUA), Deere and Co (DE), Potash Corp. of Saskatchewan (POT), MBIA Inc (MBI)

In the News

· Continental, United Airlines Align to Lower Costs

· Moody's Cuts Bond Insurers MBIA, Ambac Ratings

· General Motors Stops Major Overhaul of Pickups, SUVs

· Yahoo's Turmoil Spreads as Top Executives Flee

· Yahoo Planning to Reorganize

· Starbucks Bringing Back Bolder Coffee

· Winnebago Sales Plunge

· Girlfriend of Missing Hedge Fund Swindler Arrested

· Some Gas Stations Declining Credit Cards

· Sorry, Charlie: Del Monte May Sell StarKist

Farm Stocks: Pick of the Crop
Millions of acres of farmland may be under water, but some agricultural outfits stand to benefit as higher prices lead to demand for seeds, equipment, and fertilizer. They include Archer Daniels Midland, Mosiac, Potash Corp., Agriam, Monsanto and John Deere.
Ag Stocks: Farm Favorites

Millions More Could Get a Rebate If They File a Return
Even as the IRS has sent out nearly 77 million tax rebates, more than 5 million retirees and disabled veterans who may qualify for a rebate haven't received one because they haven't filed a tax return.
Millions more could get a rebate if they file a return - USATODAY.com

Downtowns in Danger of Going Downhill, Again
In recent years many once moribund downtowns received funding to begin impressive comebacks as both residential and commercial centers. But as the economy stumbles and the money dries up, many projects are stalling. Will these downtowns be able to survive the downturn? From L.A. to Richmond and Atlanta to Seattle see which project are in danger in 13 cities.
Are Downtowns in Danger of Going Downhill Again?
In Pictures: Downtowns in Downturn

Credit Scores: Now Lifestyle Matters Too
Lenders may be monitoring your bar tab or marriage counseling bill - which could be costly for consumers.
Are Creditors Eyeing Your Purchases? - BusinessWeek

To Save Money at Gas Pump, Pay Cash
Filling stations are slapping a 6¢-a-gallon premium on credit-card customers, to help offset the hefty fees such purchases involve.
To Save Money at the Gas Pump, Pay Cash

6 Destinations to See Before It's Too Late
Global warming is expected to ruin some of the world's most beautiful tourist spots. They include Glacier National Park, Montana, The Maldives, Mount Kilimanjaro, Mauritius, Lake Mead in Neveda and Churchill, Manitoba.
6 Vacation Spots Threatened by Global Warming -SmartMoney.com

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Stock picks under $10, 10 worst managed companies & historic site foreclosures

Allan Halprin — 2008-06-18T09:29:00+00:00

Filed under: Yahoo! (YHOO), Apple Inc (AAPL), Pfizer (PFE), Starbucks (SBUX), Ford Motor (F), Motorola (MOT), Johnson and Johnson (JNJ), Sprint Nextel Corp (S), Advanced Micro Dev (AMD), Money and Finance Today, Boston Scientific (BSX), Circuit City Stores (CC), CIT Group (CIT), Kellogg Co (K), Sears Holdings (SHLD), FedEx Corp (FDX), Morgan Stanley (MS), Amer Intl Group (AIG), Sun Microsystems (JAVA), Liz Claiborne (LIZ)

In the News:

· Morgan Stanley 2Q Profit Plunges 57%

· FedEx Profit Wrecked By High Fuel Costs, Company Warns

· Generic Versions of Lipitor Expected in 2011

· Apple's iPhone Sales May Double in 2009

· Northwest Airlines to Cut Flights, Offer Early Buyouts

· Kellogg Shrinks Size of Fruit Loops, Apple Jacks and Other Cereals

· Unhappy 1-Year Anniversary for Yahoo CEO Jerry Yang

· LinkedIn Valued at $1 Billion; Big Plans Afoot

· Tomatoes Back at Fast Food Restaurants

· Red Cross and Johnson & Johnson Dispute Over Red Cross Symbol Settled

Stock Picks for Under $10
There are a lot of once-highflying stocks that have fallen below $10 and look like bargains ripe for the picking. See if CIT Group, Ford, Motorola, Tenet Healthcare, Dynegy and Interpublic.
Stock Picks for Under $10 - CNBC

10 Worst Managed Companies in America
With the trading year almost half over and results from the first quarter out, 24/7 Wall St. presents its latest installment of its Ten Worst Managed Companies In America list. They include Sun Microsystems, Sears, Boston Scientific, Starbucks, Sprint, Circuit City, Motorola, AMD, AIG and Pfizer.
24/7 Wall St.: The 24/7 Wall St. Ten Worst Managed Companies In America

Historic Sites in Danger of Foreclosure
Mark Twain, Edith Wharton and other boldfaced names among the dead have something in common with living Americans in these hard financial times.
Foreclosure Looms Over Historic Sites - AOL Money & Finance

The Credit Trap
How rising home values and easy credit put your finances at risk.
How rising home values, easy credit put your finances at risk - USATODAY.com

Wal-Mart: The New Green Giant
From solar panels to less packaging, the retailer continues to unveil Earth-friendly initiatives.
In Pictures: Green Giant - BusinessWeek

Coffee Drinkers Live Longer?
For women, especially, the brew could boost heart health, study finds.
Coffee Drinkers Might Live Longer

Prepare Now, Save Come Winter
Taking these steps to lower your heating bills now will pay off when winter hits.
Prepare Now for a Pricey Winter Heating Season - SmartMoney.com

Tap Water Making a Comeback
With a day's worth of bottled water -- the recommended 64 ounces -- costing hundreds to thousands of dollars a year depending on the brand, more people are opting to drink water that comes straight from the sink.
Feeling thrifty, the thirsty reach for tap, not bottle - USATODAY.com

Can Mizrahi Revive Liz Claiborne?
January, Liz Claiborne hired Mizrahi away from Target to become the new creative director for women's apparel, accessories, and licensing. Claiborne C.E.O. Bill McComb hopes Mizrahi's touch will awaken Liz from the extended slumber of dowdy, forgettable styles and make the brand back into a wardrobe essential for fashion-conscious working women. Can he do it?
Liz Claiborne's Mizrahi Moment - Portfolio.com

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Rolling Stones rumored to defect EMI for Live Nation

Richard Driver — 2008-06-16T17:29:00+00:00

Filed under: Rumors, Products and services, Competitive strategy, Starbucks (SBUX), Marketing and advertising

Following the groundbreaking signings with Madonna, U2, and Jay-Z, Live Nation (NYSE: LYV) is rumored to be courting The Rolling Stones away from privately held EMI Group, according to British music newspaper NME. The newspaper quotes a report from the print edition of The Observer, that the band is going to sign a deal with Live Nation that would allow the live music events company to "take over the marketing of the group's back catalogue, worth over £3 million (roughly $6 million) a year," in addition to typical touring and merchandising rights.

The Rolling Stones have been with EMI in the UK since the band started its own label in 1970, although initially only in a distribution agreement before the band shifted to EMI's Virgin Records by 1976. The band's contract with EMI expired earlier this year and they signed a one album deal with Universal Music Group to release the soundtrack to the Martin Scorsese-helmed live film Shine A Light. In late 2005, the band also released a special compilation through Starbucks (NASDAQ: SBUX).

Assuming the band does not return to EMI, as this report indicates and the band has strongly denied, the band follows Paul McCartney and Radiohead, among others, on their way out of the troubled music company. However, though EMI is troubled, Live Nation has lured artists from other music companies as well. For The Rolling Stones, signing with Live Nation would be natural since the band consistently has long and successful tours, with and without the release of albums with new material. The soundtrack to Shine A Light has also sold well, with more copies sold than previous live albums from the band.

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Electric bills heading way up, get retirement savings from Uncle Sam & Starbucks' last shot - Today in Money 6/16

Allan Halprin — 2008-06-16T08:59:00+00:00

Filed under: Starbucks (SBUX), XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI), Money and Finance Today, Amer Intl Group (AIG), Lehman Br Holdings (LEH)

In the News:

· Lehman Brothers Reports $2.8 Billion Loss; First Quarterly Loss Ever

· AIG CEO Martin Sullivan Steps Down; Latest Victim of Credit Crisis

· XM, Sirius Win Support of FCC

· CEO Pay Continues Higher Even As Companies & Economy Struggles

· Midwest Floods Could Reduce Corn Supply, Raise Prices Even More

· Iconic Stoli Vodka Might Get Sold

· Seth Tobias Estate Case Reaches Settlement

Electricity Bills Heading Up. Way Up
Utilities across the USA are raising power prices up to 29%, mostly to pay for soaring fuel costs, but also to build new plants and refurbish an aging power grid. Even more dramatic rate increases are ahead. The mounting electric bills will further squeeze households struggling with spiraling gasoline prices.
Price jolt: Electricity bills going up, up, up - USATODAY.com

Get Retirement Savings Money From Uncle Sam
Barack Obama would match up to $500 in savings for families earning under $75,000. It would cost the government but help people save. Is it a good idea?
Get retirement savings $$ from Uncle Sam - CNNmoney

Battling Back From Devastating Debt
Up to your eyeballs in debt? You're not alone. Americans are in hock. See how bad it is and what you can do about it.
Americans falling deeper in debt
Also: 10 Bad Habits That Lead to Debt Disaster

Auto Industry's Worst Blunders
The auto industry has come up with some brilliant ideas that changed history. It has also made some pretty stupid moves like ignoring fuel efficiency, ignoring quality and stupid alliances.
Auto Industry Blunders: BusinessWeek

Starbucks' Last Shot
Starbucks' chief caffeinista faces penny-pinching customers, a plunging stock price, and competition from Dunkin' Donuts and McDonald's. Can Howard Schultz keep his company from getting creamed?
Starbucks CEO Howard Schultz Profile - Portfolio.com

Cut Your Grocery Bill in Half
Everyone's hurting thanks to high food prices - here's how to slash what you spend on groceries.
Web savvy ways to slash your grocery bill - CNNmoney
Also: How to Use Web to Save on Groceries, Dining Out and more

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Starbucks (SBUX) loves Europe

Douglas McIntyre — 2008-06-12T08:57:00+00:00

Filed under: International markets, Deals, Competitive strategy, Starbucks (SBUX)

Starbucks (NASDAQ:SBUX) can't seem to do well in the US. People who feel poor don't want $5 coffee and the chain seems to have built too many stores here. The company has even gone so far as to close some.

But, bright on the horizon, the Seattle-based company sees Europe as a potential region for expansion. So, the company will open 150 new stories on the continent. According to Reuters, "The coffee shops are to be opened at airports and railway stations and come as the chain looks to offset a slumping U.S. market with overseas growth." The new stores will be franchised and run by a UK company called SSP. At least that probably means Starbucks will not be taking all of the financial risk.

Starbucks may find that a recession in Europe is likely to keep people out of expensive coffee shops just as much as its has in the US. But, the new push into the continent has a more telling aspect. Starbucks does not have the taste for risk that it once did. There was a time when the company would have taken all of the risk and all of the reward to push more aggressively into a large market.

Starbucks is not only suffering from slowing sales. It is getting timid.

Douglas A. McIntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 letter.

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Before the bell: AIG, CAT, SBUX, AMZN, TMA, GM ...

Melly Alazraki — 2008-06-12T08:19:00+00:00

Filed under: Before the bell, Earnings reports, Deals, Google (GOOG), Yahoo! (YHOO), Apple Inc (AAPL), Starbucks (SBUX), Amazon.com (AMZN), General Motors (GM), Caterpillar (CAT), Amer Intl Group (AIG)

Before the bell: Futures higher after BUD offer, ahead of retail sales

American International Group (NYSE: AIG) shareholders -- former AIG director, Eli Broad, and two fund managers , who together control about 4% -- are asking for changes to the management and board of the world's largest insurer, which has been struggling with the fallout of the subprime mortgage mess.

Caterpillar Inc. (NYSE: CAT) said it will spend $1 billion over the next two years to expand capacity in five of its Illinois factories, and will shift production at some of its plants to address the demand for machines used mostly in mining and large infrastructure projects.
Also, CAT and Navistar International Corp. (NASDAQ: NAVZ) will begin cooperating to pursue new on-highway truck business and cooperate on an variety of engine platforms.

Starbucks Coffee Co. (NASDAQ: SBUX) said Thursday that it has reached a licensing agreement with SSP to open coffee retail stores in more than 150 airports and train stations in Europe. Financial terms were not disclosed.

William Ackerman, the billionaire hedge fund manager who is a major stakeholder in Borders Group Inc. (NYSE: BGP) is pushing for Amazon.com, Inc. (NASDAQ: AMZN) to go for Borders, saying it could become the "bricks-and-clicks" component of Amazon's nationwide sales strategy.

BusinessWeek has an interesting article about how in Japan Apple Inc. (NASDAQ: AAPL), Google Inc. (NASDAQ: GOOG) and Yahoo! Inc. (NASDAQ: YHOO) will have to work together, despite being direct competitors in some things.
Thornburg Mortgage (NYSE: TMA) shares are climbing over 5.5% in premarket trading after it said it swung to a first-quarter loss of $3.31 billion due to delinquent loans.

General Motors Corp (NYSE: GM)'s head of European operations sees European sales slumping to levels not seen in decades due to rising oil prices, high commodity costs and the strength of the euro.

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Paul McCartney to give away track for donations

Richard Driver — 2008-06-05T15:38:00+00:00

Filed under: Press releases, Products and services, Consumer experience, Starbucks (SBUX), Marketing and advertising

Former Beatle and recently divorced Paul McCartney is reportedly planning to host a virtual dinner to raise funds for Adopt-A-Minefield, promising donors and fans who pledge $25 a new, unreleased track entitled "Lifelong Passion (Sail Away)." Those who register with McCartney's official website, www.paulmccartney.com, and donate will also receive "some special vegetarian recipes from celebrity chef Jamie Oliver."

It was this time a year ago that McCartney released the debut album for Starbucks' (NASDAQ: SBUX) music label Hear Music. Also his first album upon leaving EMI after 45 years, Memory Almost Full debuted at #3 in Billboard and sold 161,000 copies in its first week. McCartney's website reported earlier this year that the album had sold over 1,000,000 copies. Last month, McCartney also gave a copy of the album away with the Mail on Sunday in the UK.

Although that album and the new track promised for donations are likely not related, McCartney has enjoyed a very profitable and successful year. Pledging such strong support for the charity is also not surprising from McCartney, and indicates another step forward for the rock icon into the digitally-based music market. In a statement announcing the virtual dinner, McCartney said, "It should be a priority to clear arable land of landmines so that communities can once again use their land to grow their own food. Some music, some fantastic recipes from Jamie and hopefully, with your help, we'll be able to raise the much needed funds for the cause."

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