For instance, in the most recent quarter, the company was able to 7.4 million of its flagship Lumia phones. Bears will argue that the company still fell shy of estimates by 700 thousand phones. Though this may be true, the 7.4 million still represents a 32% increase from the first quarter. Another thing; Nokia's loss of 227 million euros was 20% better than the expected loss of 276 million euros. I'm not ignoring the reality that this company still has plenty of work to do. Returning value to shareholders is not going to happen overnight. But you don't have to look too far to see that the company is on an uptrend. More importantl, investors no longer have to question whether Nokia deserves consideration as a good turnaround story. Management is authoring a new chapter. AMD) Next on our list is Advanced Micro Devices, which is currently trading around $3.70 per share. On May 13, I told you that the stock was overbought. There was just too much optimism for a company that I thought was performing average at bests. Now, let's remember that I recommended it as a sell while the stock was trading at $4.17 as the stock had made five new 52-week highs within a span of two weeks. In that article, I said the following: "I don't see a compelling reason to buy the stock at these levels. What's more, since November 16 of last year, when AMD reached a $1.81, the stock is now up more than 120%. Again, while there are signs of improvement, these shares might have already reached their expected highs for the year. If management can execute and return the company to profitability then the stock may have some more legs, but at this point I think the safer play here is to take your profits and wait and see what the next quarter brings." I remember being attacked by readers in the comments section, poking fun at my quote where I suggested that "Games aren't going to cut it." My point was despite AMD's weakness in the chip business, the company decided to bet heavily on the gaming industry - making chips for Microsoft's ( MSFT) Xbox One console and Sony's ( SNE) PlayStation 3. I also questioned management's aggressive growth strategy, which would come at the expense of profits. I didn't trust that this was the right play given the deficits that AMD has had to work with. Well, these issues (among others) came home to roost in the company's second-quarter earnings report.
Despite posting 6.7% revenue growth and beating estimates by more than 5%, shares of AMD took a pounding, falling as much as 17% following the announcement last week. This is not something that you would ordinarily see for a tech company, especially given the fact that management guided for 22% third-quarter growth, which exceeded expectations. The reason for the decline was that despite the growth projections, margins for the new gaming consoles were 50% below Street estimates. AMD guided for 10%, while analysts were looking for 20%. Again, this was precisely what I pointed out more than two months ago -- games were not going to be enough, and margins weren't going to be there. Today, the story has not changed, and the stock is down more than 20% since Friday. Given the company's lack of competitive leverage I can't (in good conscience) recommend these shares. If the PC industry makes a miraculous recovery, then I'll reconsider. But even during the PC boom, AMD was fighting Intel ( INTC) and NVIDIA ( NVDA), which, in my opinion, remain better buys today than AMD. I maintain my 12-month price target of $3.50 on these shares, which is 5% lower than where the stock is trading today. Buy Sirius XM ( SIRI) Shares of Sirius XM have been on fire all year. The stock is currently trading around $3.68 per share after having begun 2013 at a price of $2.89. In fact, if you consider the recent 52-week high of $3.77 reached on July 15, the stock has gained as much as 30% year-to-date and 109% over the past year. Remarkably, Sirius has posted these gains even as Apple and Google have entered the realm of music streaming where Pandora ( P) and Spotify (among others) were already seen as threats. The Street does not seem to care, even though Apple has entered Sirius' precious domain in the automobile dashboard. I recently chronicled my love-hate relationship with this stock, while detailing both my best and worst moments as an investor. But I don't believe that it's coincidence that the stock is climbing as the company is in the midst of the $2 billion share buyback program. Not that it makes a bit of difference in terms of value, but it's important to also realize the company-initiated catalyst that is at play here. This makes buying the stock at these levels as close to a no-brainer as there can possibly be.
However, for Sirius, it's more than just the buyback program. Liberty Media ( LMCA) is now in full control of the company. Sirius is no longer bleeding subscribers and is now posting record numbers for revenue and cash flow growth. So, not only is the company operating on all cylinders, there are no meaningful signs of slowing down, including its recently announced 15% increase in net subscriber additions last week. What's more, the company just also announced a new partnership with AT&T ( T) to provide connectivity to its telematics platform that will arrive in new Nissan ( NSANY) vehicles. In other words, Sirius is working to become more than "just radio." While there are several unknowns with telematics such as what it will become and how much it will cost, it is clear that Sirius is not sitting idle -- waiting to run out of gas. The company has found a way to profit from the "connected car," which is what Apple and Google are racing to produce. Is it possible that Sirius, which is not seen as a "tech company," will get there first? I wouldn't wait to find out. Shares are getting progressively more expensive. Investors that are looking for ways to play the audio streaming market that are also looking for some safety would do well taking a long ride with Sirius.