Wyatt Research Week in Review: April 5-11

Earnings season is underway.earnings-season

Alcoa (NYSE: AA) unofficially kicked off Wall Street’s quarterly ritual when it reported first-quarter earnings after the closing bell Wednesday.

The results were mixed. Alcoa’s earnings per share of 28 cents beat the consensus estimate of 26 cents a share, while revenue of $5.82 billion fell short of the $5.94 billion mark projected by analysts. Whether Alcoa’s uneven performance will be a bellwether for a roller coaster earnings season is anyone’s guess.

Also on Wednesday, the Federal Reserve released the minutes of its March policy meeting. It too was a mixed bag. Several officials thought June would be an appropriate time to raise interest rates, while others advised holding off until 2016.

The markets appeared unfazed by the Fed waffling, with the Dow Jones Industrial Average adding 27.09 points to close Wednesday’s session at 17902.51.

The release of the inconclusive Fed minutes came on the heels of a lackluster jobs report, which was issued by the Bureau of Labor Statistics while the markets slumbered for the Good Friday holiday.

According to the report, total nonfarm payroll employment in the U.S. increased by 126,000 in March. This figure was well below the 245,000 jobs expected by analysts, and was even further off the 269,000 monthly average for new jobs created over the past year.

Wyatt Research analyst Bob Ciura provides his take here of what the jobs report’s potential impact is on the Fed’s decision-making process regarding a rate hike.

Looking forward to next week, 35 S&P 500 companies will report earnings, including Johnson & Johnson (NYSE: JNJ), Intel (NASDAQ: INTC), Netflix (NASDAQ: NFLX) and General Electric (NYSE: GE). But the spotlight will undoubtedly be on the financials sector, with JPMorgan Chase (NYSE: JPM), Wells Fargo (NYSE: WFC), Bank of America (NYSE: BAC), Citigroup (NYSE: C), American Express (NYSE: AXP) and Goldman Sachs (NYSE: GS) all reporting.

It should be a busy week here at Wyatt Research. But for now, I’ll leave you with some of my favorite stories from the past week:

Top 5 Dividend Increases for April – Looking at the S&P 500 over the last year, the index is up 9.3%. But if you look at the total return of the S&P 500 – which includes stock price appreciation and dividends – the return is 11.6%. That’s the power of dividends, and we’ve picked the top five stocks increasing their dividends in April.

Are Mexican Stocks Heating Up? – The Mexican peso is down 14% against the U.S. dollar during the past year. That’s great news for companies manufacturing products in Mexico that are listed on U.S. stock exchanges. Click here to find out which stocks are poised to benefit most from the decline of the peso.

This Sector Is a High-Yield Dividend Haven – For investors solely concerned with generating high-yield dividend income, there are few better places to look than this sector, which enjoys tremendous pricing power and high free cash flow.

Will a New CFO Lead to a Google Dividend?Google (NASDAQ: GOOGL) announced at the end of March that it had hired longtime Morgan Stanley (NYSE: MS) executive Ruth Porat to take over as its new CFO. Will Porat’s Wall Street pedigree finally translate into a dividend and/or share repurchase program for the Silicon Valley search engine king?

Diversified Biotech Rewards with Lower Risk – The biotech sector has been crushing the market for five years running. But finding low-risk, high-reward investments in this space isn’t always easy. Tyler Laundon details a few simple strategies that investors can follow to raise their chances of success in the biotech sector, while reducing risk.

Will Higher Employee Wages Hurt Corporate Profits?Wal-Mart (NYSE: WMT) has announced that it will raise its minimum wage this month to $9 an hour – $1.75 more than the federal minimum of $7.25. Starting July 1, McDonald’s (NYSE: MCD) will pay at least $1 an hour more than the local minimum wage for employees at its U.S. company-owned restaurants. What do wage hikes mean for the profits of Wal-Mart and McDonald’s, the inarguable leaders of their respective industries?

The Top 3 S&P 500 Dividend Stocks to Own Today – Last quarter, the S&P 500 set a record for the amount of dividends paid – again. This marks the fourth straight quarter of record dividend payments by the S&P 500, and 84% of the stocks in the S&P are now paying a dividend. That’s a lot of dividend stocks to choose from, so we’ve selected the best of the best.

Can Netflix Survive the Streaming War? – The massive success of Netflix – first in the DVD-by-mail industry and then in streaming video – was the primary reason that Blockbuster filed for Chapter 11 bankruptcy protection in 2010, and why video stores are nearly extinct in the U.S. But now Netflix is coming under fire from a host of competitors, including Hulu, Amazon’s (NASDAQ: AMZN) Prime Instant Video and Apple (NASDAQ: AAPL) – which is widely rumored to be planning an Apple TV subscription streaming service in the fall. Is Netflix heading for a fall?

Apple Watch Facts: Everything You Need to Know  – The new Apple Watch became available for preorder Friday and will be released April 24. Even if you never plan to buy Apple’s new product, it’s important that you understand all the Apple Watch facts, and why it’s important to the future growth of the world’s most valuable company.

Have a great weekend!

Published by Wyatt Investment Research at