SiRF Technology Holdings Inc. (SIRF) is riding high this week as its shares have jumped from $24.72 to $30.27 (or a gain of 2.5%). The bulk of the gains happened on Thursday, as the market digested the outstanding news that the GPS component developer released about this 4th quarter's earnings and its outlook Q1 as well.

Despite the fact that equity-based compensation caused Q4 2006 earnings to be lower than the same period a year ago ($0.16 per share versus $0.19 per share), the company announced that its Q1 earnings for 2007 will be in the range of $0.20-$0.23. You may well be wondering where this big source of growth is coming from. According to SiRF, it all has to do with the newest trend of placing GPS chips and other related pieces of technology into cell phones and other wireless products.

Since the ultimate function of a cell phone is quickly becoming indistinguishable, cell phone producers are always on the look out for new bells and whistles to attract people to buy their phones over the competition's products. Just consider the integration of the camera and the mp3 player functions on cell phones, which up until a couple of years ago was non-existent. The next biggest feature could very well be GPS on your phone. Motorola (MOT) and AT&T's (T) T-Mobile are just some of the brands that are implementing SiRF's GPS chip in their products and if this trend starts picking up, SiRF is definitely going to riding this wave of success for a long time.


Nutrisystem Incorporated's (NTRI) crash diet continues this week, as its share price shredded another $14.41.

This latest loss from this week can be attributed to news that while the company's quarterly earnings for the fourth quarter of 2006 exceeded analyst expectations, its guidance for the first quarter of 2007 was disappointing. Management released guidance that the firm will be earning between $0.82 to $0.86 per share, compared to analyst estimates of $0.94 per share.

This is just the latest piece of bad news that has significantly slashed the company's share price. Earlier in January, several analysts issued downgrades over concerns that Nutrisystem's growth is slowing. Declining rates of growth is inevitable for all companies and the situation should not be any different for Nutrisystem considering that the company has seen growth well over 2000% over the last few years.

This may suggest that the company will need to change up its game plan a little, however. While its celebrity endorsements and other related marketing ploys have allowed it to reach remarkable rates of growth in the past, it certainly doesn't look like it's working now. Furthermore, the company itself reports that the average person uses the service for around 10 weeks, which isn't too long considering how health club and gyms usually lock up customers for up to a year with annual memberships (even though most new customers don't visit the gym past the first 3 months).

All in all, in the past two weeks, Nutrisystem's share price has fallen from $68.10 to 44.05 as a result of concerns over its future growth. At this rate, the company will have to address these concerns or else its share price will simply continue to slim down.

Related Articles
  1. Stock Analysis

    Will J.C. Penney Come Back in 2016? (JCP)

    J.C. Penney is without a doubt turning itself around, but that doesn't guarantee the stock will respond immediately.
  2. Stock Analysis

    Allstate: How Being Boring Earns it Billions (ALL)

    A summary of what Allstate Insurance sells and whom it sells it to including recent mergers and acquisitions that have helped boost its bottom line.
  3. Options & Futures

    Cyclical Versus Non-Cyclical Stocks

    Investing during an economic downturn simply means changing your focus. Discover the benefits of defensive stocks.
  4. Investing Basics

    How to Deduct Your Stock Losses

    Held onto a stock for too long? Selling at a loss is never ideal, but it is possible to minimize the damage. Here's how.
  5. Economics

    Is Wall Street Living in Denial?

    Will remaining calm and staying long present significant risks to your investment health?
  6. Stock Analysis

    When Will Dick's Sporting Goods Bounce Back? (DKS)

    Is DKS a bargain here?
  7. Investing News

    How AT&T Evolved into a Mobile Phone Giant

    A third of Americans use an AT&T mobile phone. How did it evolve from a state-sponsored monopoly, though antitrust and a technological revolution?
  8. Stock Analysis

    Home Depot: Can its Shares Continue Climbing?

    Home Depot has outperformed the market by a wide margin in the last 12 months. Is this sustainable?
  9. Stock Analysis

    Yelp: Can it Regain its Losses in 2016? (YELP)

    Yelp investors have had reason to be happy recently. Will the good spirits last?
  10. Stock Analysis

    Is Walmart's Rally Sustainable? (WMT)

    Walmart is enjoying a short-term rally. Is it sustainable? Is Amazon still a better bet?
  1. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  2. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  3. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  4. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  5. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  6. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>

You May Also Like

Trading Center