This article originally appeared on RealMoney.com on Sept. 5, 2014 at 10:00 a.m. To read more content like this AND see inside Jim Cramer's multi-million dollar portfolio for FREE... Click Here NOW.
The Labor Department jobs report missed consensus for August, and the ADP numbers were also on the soft. With these figures thrown into the mix, the U.S. economy is throwing off conflicting signs, making the investment process ever more difficult. Personally, I think this mixed bag puts a premium on buying leading businesses in their respective sectors -- those companies with best-in-class operating margins and management teams whose interests are truly aligned with those of shareholders.
In any case, here are some areas that may trigger confusion.
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Restaurant stocks: The North American restaurants total return index, per Bloomberg data, is down 4.55% this year, trailing the S&P 500's roughly 9% total return. The index began to lag the S&P in April thanks to worse-than-expected customer traffic in the first half of the year. Is this index a leading or lagging indicator? Beats me. I just think its performance stands in such stark contrast to the rising broader market, and to domestic-macro-economy enthusiasm among geeky chief economists, that it's worth mentioning. This is also worth considering when you're researching companies with a gaze into 2015.
Cruise line operators: Check the backlog. I came out as bullish on cruise line stocks a while back, and these stocks have continued to push higher. Aside from the fact that new and fancier ships are set to arrive to market this year and next, companies such as Norwegian (NCLH) and Royal Caribbean (RCL) are revitalizing older vessels. And, believe me, people are spending more per visit as a result of upgraded dining and entertainment amenities. Given the weak traffic and stock prices for restaurants, this doesn't make a ton of sense, does it?