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Icahn's Departure Could Be Sad Ending for Blockbuster


The company's chances of mounting a comeback just went way down.

The weekend just goes way too fast, doesn't it?

Asian stocks rose overnight. The Hang Seng and the Nikkei were up 0.61% and 0.07%, respectively. European stocks were up early this morning, too. And here in the US, we're currently trading higher.

Here's what I'm seeing this morning:

Bye bye, Carl Icahn? News reports suggest that the activist investor is resigning from Blockbuster's board.

Just a couple thoughts:

1. I've always been a fan of Icahn and what he does. Without him on the board, I think the company's chances of mounting a comeback have just gone down.

As I've stated several times before, when it comes to the video-rental business, I think Netflix (NFLX) is the clear pick right now. (Be sure to check out the company's terrific fourth-quarter numbers.)

Oracle (ORCL):
Justin Sharon points out in his article this morning that Credit Suisse slapped an Outperform rating on the California-based company.

My thoughts:

1. I like Oracle and view the recent pullback as an opportunity. With Ellison at the helm and solid growth expected from this year to next, we could be looking at a $30 stock within 12 to 18 months.

2. The downside is that it's thumped estimates in three of the last four quarters and I think the Street has some high expectations. If it missteps going forward, it could take a pretty swift hit. But all things considered, I think this is a solid time to put on the hip boots and wade on in.

3. Anyone else out there see that estimates have been on the rise?

For my last take on Oracle, click here.

Macy's (M):
Deutsche dropped its rating to Hold from Buy, and I wanted to weigh in.

1. While I'm a much bigger fan of discount stores and have been for a long while, this is one department chain that deserves a look right now. In case you missed it, it's been consistently beating expectations on the bottom line and trades at a very respectable 13.4 times this year's estimate. (Note that it's due out with its numbers later in the month.)

2. Ideally I'd like to belly up a bit cheaper, but in thinking about where this stock could be in three to five years, this does look like a decent entry point.

Exxon Mobil
The company turned in its fourth-quarter numbers. It put $1.27 on the scoreboard whereas the Street was at just $1.19.

It's hard to ignore this beat. I'm betting that the earnings will be at the center of attention here, particularly early on in the session, and that the shares trade higher on the heels of the news. It's equally hard to ignore the potential bottom-line growth the company could experience in 2010, and of course the numbers it could potentially put up in the next decade. I think the shares are a good value here in the low to mid $60s, and that we could see 15% to 20% upside within a year's time.

Have a great day!
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No positions in stocks mentioned.

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