For years, the airline industry was the butt of Warren Buffetts jokes.
In his 2007 letter to Berkshire Hathaway shareholders, Buffett laid out examples of great, good and terrible businesses.
The airline industry played the part of terrible.
Here is exactly what Buffett wrote:
Now lets move to the gruesome. The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money.
Here a durable competitive advantage has proven elusive ever since the days of the Wright Brothers. Indeed, if a farsighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down.
Keep in mind, this was not Buffetts take on one bad airline company.
Top 5 Warren Buffett Stocks To Own Right Now: Twitter, Inc.(TWTR)
- [By Vikram Nagarkar] Can Twitter Inc (NYSE:TWTR) surprise investors with its Q1 earnings numbers? San Francisco, California-based Twitter Inc (NYSE:TWTR)is scheduled to report its quarterly results for Q1 2017 on Wednesday, 26th April, before markets open. Twitter is expected to come out with its latest set of earnings numbers at 7 A.M. Eastern Time, or 4 A.M. Pacific Time. While expectations from the micro-blogging platform are quite low going into Q1 earnings, it has been a very eventful quarter for the company nonetheless. Can Twitter surprise investors with its results this time around? Let’s look at analyst estimates and key events that unfolded during Q1 2017. Analyst Estimates For Twitter’s Q1 2017 Earnings Release.
As you’d expect, analyst expectations are rather subdued. The consensus expectations are for the company to report revenue of $511.9 million, representing a near 14% drop Year-over-Year (YoY). Analysts’ expectations indicate the possibility of what could be the first instance of a YoY decline in top line numbers for the social media platform. What’s more, the decline is expected to be sharp, compared to the low single digit growth rates the company registered last year. Twitter’s management has abstained from offering any revenue guidance for the quarter.
- [By Lisa Levin]
Twitter Inc (NYSE: TWTR) reported better-than-expected results for its first quarter.
The social media company earned 16 cents per share in the first quarter on revenue of $664.87 million versus expectations of 11 cents per share and $605.26 million.
- [By Adam Levy]
That’s not to say Instagram hasn’t done a good job on its own. It says it has 8 million businesses with profiles — the equivalent of Pages on Facebook. For comparison, Twitter (NYSE:TWTR) said it had identified 9 million active businesses on its social network around this time last year.
Top 5 Warren Buffett Stocks To Own Right Now: CNB Financial Corporation(CCNE)
- [By Stephan Byrd]
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Top 5 Warren Buffett Stocks To Own Right Now: SandRidge Permian Trust(PER)
- [By Dustin Parrett]
As a service to our readers, we’ve put together a list of 10 cheap oil stocks under $5. Here are the stocks, share prices, and year-to-date (YTD) returns for each:
Vallourec Sp (OTCMKTS ADR: VLOWY); $1.42; +13.6% YTDIthaca Energy Inc. (TSE: IAE); $1.93; +14.5% YTDSandRidge Permian Trust (NYSE: PER); $3.45; +16.95% YTDGeopark Ltd. (NYSE: GPRK); $5.06; +17.4% YTDGastar Exploration Inc. (NYSEMKT: GST); $1.89; +22.26% YTDAscent Resources Plc. (LON: AST); $2.11; +25.53% YTDErin Energy Corp. (NYSEMKT: ERN); $3.94; +29.1% YTDChesapeake Granite Wash Trust (NYSE: CHKR); $3.25; +38.3% YTDSouthcross Energy Partners LP (NYSE: SXE); $2.27; +68.15% YTDBonanza Creek Energy Inc. (NYSE: BCEI); $2.27; +122.55% YTD
This list of oil stocks contains some highly speculative plays, so we can’t recommend buying them.
Top 5 Warren Buffett Stocks To Own Right Now: Catalent, Inc.(CTLT)
- [By Lisa Levin]
Catalent Inc (NASDAQ: CTLT) shares were also up, gaining 15 percent to $40.57 as the company reported stronger-than-expected results for its fourth quarter on Monday.
Top 5 Warren Buffett Stocks To Own Right Now: Green Mountain Coffee Roasters Inc.(GMCR)
- [By David Sterman]
But for short sellers in Green Mountain Coffee Roasters (Nasdaq: GMCR), there's another outcome: They've been badly burned as shares have surged, but they insist they've been right all along, and it's only a matter of time before the stock crashes and burns.
- [By Canadian Value]
So Im going to stick my next out and share my views on four battleground stocks that are among my favorite shorts: World Acceptance (WRLD), Green Mountain (GMCR), Herbalife (HLF), and InterOil (IOC). And next week at the Value Investing Congress I will present another short, my largest.
- [By Jonas Elmerraji]
As badly as short sellers want to hate on Green Mountain Coffee Roasters (GMCR), betting against the multiyear rally in this $12.7 billion beverage stock has been about as wise as eating from a box with a skull and crossbones on it. And as a bull market continues to lift all ships, Green Mountain’s ship is going to keep floating above the others.
Green Mountain owns Keurig, the brand of beverage brewers that use self-contained K-Cups to make coffee, teas, and other drinks. While Keurig’s “fad” status has certainly helped tip the deck against GMCR, the fact remains that the firm has done most of the hard work in getting Keurig machines accepted by consumers. With brewers essentially ubiquitous at this point, the firm is able to make money on its cash cow: the K-Cups.
Keurig’s individual-serving cups have big margins and a big installed base. With huge convenience and the relatively large sunk cost that consumers have put into their Keurig machines, it’s a sticky business with big switching costs. Consumers who buy a Keurig are much less likely to spend the money on a competing brand of proprietary coffee pods.
I’ve said before that GMCR is far from cheap right now. But its momentum trajectory is showing few signs of fizzling out, especially as direct competitors such as Starbucks (SBUX) continue to sell K-Cups of their own. Don’t bet against GMCR in September – buy this Rocket Stock instead.