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Ticker Shock: Schlumberger Good Long-Term Play - But Rite Aid Does the Splits


Friday's top stories and stocks with potential to move.


Nice little rebound yesterday, right? Let's hope for more of the same today.

Asia was a mixed bag, with the Hang Sang down more than 4%. However, the Nikkei inched up almost 3%. Europe however was in the green. And thus far, our markets are in the red.

But the way things are going, that could change in 3 minutes or less.

Google (GOOG)
After the close on Tuesday, the company (which needs no introduction) nailed down a third-quarter profit of $4.92 per share, easily beating the Street's estimate of $4.75 per share. Unsurprisingly, the stock looks like it's headed for a higher open this morning.

But what caught my eye was management's focus on costs: The company has reduced its capital spending by 18% (to $452 million). It's also acquiring far less new talent: Google hired only 519 people in the quarter, compared to 2,130 in the comparable period last year.

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This perks my interest, because, when I think of Google, I think of a company that believes it can grow to the moon. I also think of a company that spends a lot of dough making sure its work environment is "cool." I mean, the place has a massage room, for Pete's sake. (Note to self: Prepare resume.)

So again, the fact that it looks like it's tightening its belt definitely caught my eye.

So would I buy the stock?

See, here's the rub: I'd rather use a pop to get out, rather than to get in. You see, at this point, I'm sensing that Yahoo (YHOO) could be the better play. The stock is down under $13 - which makes me think Icahn and crew will be doing everything they can to get that stock price rolling in 2009.

Big Blue reported its third-quarter results after yesterday's close as well, and the $2.05 a share it put up was $0.02 north of expectations. The downside: IBM's revenue was a bit shy of expectations. But nothing to really get in a twist about; overall, the release seemed pretty upbeat, and gross margins remained strong.

I think the shares deserve to trade higher today. Whether they actually do or not will, I think, be a function of the larger market.

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No positions in stocks mentioned.

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