-Executive Summary-

• The markets sold-off hard in the afternoon, following another robust morning.  This kind of pull-back was expected after a strong “v-shaped” recovery by the individual markets off their recent lows during the height of the crisis in Japan.  This type of afternoon selling will shake out some recent buyers.
• We sent out an SMC Intra-Day Update and include it below.
• Excellent retailer – Lululemon Athletica (Ticker: LULU) – which has been bucking the weakness in retail stocks, announced director approval for a 2/1 split.  This will be their first stock split.  Shares shot strongly higher today to $85.27/share, in spite of rather unimpressive earnings news last week.  We are going to keep an eye on it.  For the SMC it is NOT a buy here, until we understand and see more.
• For the record, we are keeping an eye on the Bank of Ireland (Ticker: IRE) as it languishes back down low.  BUT a Spanish bank today asked for a bailout, indicating that private investors perhaps do not have the appetite for such excursions into risk territory as the Bank of Ireland offers.  Ireland completes a new “stress test” for its banks this week.
• Ebay, Inc. (Ticker: EBAY $30.34) made another significant acquisition.  We write about it below.  The smart-phone is bringing more people online with very practical tools.  Ebay, Inc. understands this.  We have included a link to an insightful video interview TODAY with their CEO John Donahoe.
• Here’s our SECOND Stock Market Companion Customer Testimony video.  Big “Thank You” to subscriber-friend, “Mike” for his exciting REAL story from the jungle of South America… Don’t miss it!  Special thanks also to video company, OTM Productions.  For those looking for an excellent and diligent video team, Jamie and Matt are the BEST.  Here’s their website – OTM Productions, Inc.
  

– Stock Market Companion – Current Holdings –

Nr.	Co.	Ticker	Action	Entry Date	Current Gain (Loss)
1	Nexxus Lighting	NEXS	Holding	3/18/2011	-20%
2	Dell Inc.	DELL	Holding	3/21/2011	-1%
3	Nvidia, Inc	NVDA	Holding	3/24/2011	+4%
4	Silicon Image, Inc.	SIMG	Holding	3/24/2011	+1%

If the above “Current Holdings” table is empty it means that we are not holding ANY stocks at this time and that we are therefore 100% in cash.

– Markets “At a Glance” –

(Please scroll down to the end of the report to see your favorite benchmarks – Dollar, Oil, Gold … closing prices and daily direction.)

Market	Price (Today’s Close)	Unit of Measure	Today’s Direction
SP-500	1,310.19	Index	Flat/Down = -3.61 points
DOW-30	12,197.88	Index	Down = -22.71 points
NASDAQ	2,730.68	Index	Down = -12.38 points
NASDAQ 100	2,303.10	Index	Down = -13.26points

– Market Trends –

Trend	SP-500	DJ-30	NASDAQ	NASDAQ 100
Short Term	Flat	Flat	Flat	Flat
Intermediate	UP	UP	UP	UP
Long Term	Lateral	Lateral	Lateral	Lateral

*Summary of terms from Trader Vic II-Principles of Professional Speculation (pg. 140-141)
*_________* Represents a change in trend rating.

– Market Perspectives –

For your added perspective, we’ve included this chart of the broader market (Successful stock investors develop and start with a minds-eye view of the broader market and keep it clear) –

1. SMC SP-500 ETF Daily Chart (Click to open helpful chart in a separate browser window).

– Today’s Highlights –

The most significant highlight today, without focusing on Japan, Libya, and other areas and events that can certainly impact the short-term nature of our equities markets, is Ebay’s proposed acquisition today of GSI Commerce, Inc. for $2.4 billion.

At the Stock Market Companion, we believe that the smart-phone is bringing more people online and providing them incredible networking tools and power to understand what price they should pay for any given item in the retail environment.  Ebay is doing its job well to understand this and is placing itself in an advantageous position with their tools like Paypal.

This “Half-Time” video interview with Ebay’s CEO John Donahoe is an excellent overview of what is happening in the retail environment due to smart-phone adoption.

Click on the link above.  Don’t miss it.

We’ve mentioned the importance of Ebay and their Paypal tool and how it is going to really drive SIGNIFICANT revenue for the company in the years to come.  Millions of Americans DO NOT HAVE bank accounts in America.  That’s why when you go to Walmart these days, you see a department near the returns area dedicated to financial products.  Millions of people no longer want or qualify for credit cards in America.  Many retailers would love to cut the rate that they spend at the point of sale to accommodate credit card purchases.

Paypal combined with some form of technology device like a smart-phone or simply a smart-card is going to tremendously change the market place.

For the Stock Market Companion, this is not the time to buy Ebay (Ticker: ebay $30.34).  Investors need to digest the significance of this acquisition and the data on how long its going to take for Ebay to integrate this acquisition.  We’re going to keep a close pulse on Ebay and wait for a good entry.  Today shares were down -4.29%.

This is a good time however to begin understanding the transformation taking place in the market place due to the smart-phone.  If we owned shares of Visa (Ticker: V) or Master Card (MA), we would be long gone.  Unless they begin to adapt to the changes in the marketplace, their core business is going to shrink.

– Story-Stock Investing –

We sent out this SMC Intra-Day Update this morning –

Dear Subscriber-Friend –

OK.  It’s one thing to have an idea, but it’s quite another to have it VALIDATED, and QUICKLY.  We have convictions, hunches, thoughts, leanings … and they often play-out OVER TIME.   Just this morning, our statement last week about the market NOT being over-valued was validated – here’s how –

Last week we wrote … “At the Stock Market Companion, Inc., we are operating under the foundational premise that the stock market today is NOT OVERVALUED.  Many individual stocks however were at risk to profit taking after making very strong runs over the past 24 months.  We avoided that problem by exiting the market when the troubles in Egypt arose, and by targeting the stocks of excellent companies AFTER strong pull-backs … like our interest in Ford Motor Co. on a -26% pullback, and Dell Inc, on a pull-back from its post-earnings highs.  …”

This early morning Ebay, Inc. announced the purchase of GSI Commerce… at a  +51% PREMIUM to Friday’s closing price.  On Friday, the shares of GSI Commerce (Ticker: GSIC) closed at $19.38/share, this morning after Ebay’s announcement the stock opened at $29.42/share.

What we have found over the past 9 months or more now, is a willingness for individual companies with strong balance sheets (strong cash reserves) to purchase other companies at a real strong premium to market prices.  Companies like Ebay are taking advantage of the relatively WEAK pricing in the market and buying companies that will strengthen and broaden their businesses over time.  Intel’s purchase of McAfee security software at a big premium to the market last year is yet another example of what we are talking about.  There have been several others.

So we repeat, the U.S. stock market is not over-valued.  But the last decade has shown that successful investors must be SELECTIVE and wise on how they engage it.  Many Americans and other first world nation retail market participants (Japanese, Germans, English, …) who have significant portions of their retirement anchored by equities have learned that without a working knowledge and at least a steady birds-eye view of the market,  simply throwing money at the market through retail investment products and firms that are expensive and often not worth their keep – is a failed strategy.

On the other hand, fear of the market and individual stocks and other investment vehicles also leads to a dead-end.

At the Stock Market Companion, we strive to educate well about market conditions, dynamics and cause and effect relationships that help keep investor’s minds clear for seeing opportunity and danger,  while pointing to opportunities that we are personally investing in along the way.  We have only just begun.

Back to GSIC… Last June, shares of the stock were valued at $31/share.  The shares have sold off in spurts since then, all the way down to $18.70 or so a few weeks ago.  Today’s offer by Ebay takes the stock back up to the $29 range, but still doesn’t reward long term shareholders who have been holding the stock for over a decade.

The shares have repeatedly been pounded down to the $12/share area, and occasionally down to $7 and below.  The 2007 highs were $28/share.  That’s a lot of excitement and fear for nothing – unless the prudent investor sells on strength and buys on severe weakness along the way.  Buy and hold doesn’t work, but in the rarest of situations.  That’s not to say that we won’t hold a stock for a year or more, but the “story” has to be right and the market too.

Our Stock Market Companion holding Nvidia (Ticker: NVDA) received a nice upgrade and a $25 target this morning.  Its shares are up around +4% this morning and returning to last Thursday’s highs.  Silicon Image, Inc (SIMG) crept above $10/share and has pulled back some.

By the way, we still like Ford Motor Co. (F).  But we just don’t know if the auto industry may take a bit more of a hit due to component supply chain issues that will certainly crimp production and earnings, due to the terrible situation in Japan.    Ford just announced that they are idling their huge factory in Genk, Belgium because of supply issues.

Investors who have purchased Ford at the low $14.00/share range have so far been rewarded some.  At the height of the nuclear reactor situation in Japan, after the market had withstood several “knee-jerk” selling, and as investors began buying Yen en masse to cover their “carry-trade” risks and the market began to experience serious selling – was the moment when we made a difficult decision to let go of Ford.  It was uncomfortable, but prudent to do so.  No one knew the immediate outcome.

For your protection and our own, we would like to remind everyone that this is not an investment recommendation for any particular individual.  We cannot possibly know the risk tolerance and investment suitability of such investments for any particular subscriber. Successful investors know their own objectives, purposes, and risks associated with any investment – whether in real estate, stocks, or other investments.  Each investor is on their own.

We are simply reporting the SMC actions in the market place.

Your – Stock Market Companion

Here is a repeat of Friday’s Story Stocks section for those who didn’t get chance to catch it during the weekend –

We have purchased these stocks over the past week or so – AFTER pulling our shares January on the first signs of trouble in Egypt and avoiding the pullback in the market that has taken shares of many excellent companies down hard –

1. Nexxus Lighting – We bought this one based on an upcoming new product line launch of LED lighting at Lowes home improvement stores this June.  Energy costs are high and people can save a lot of money with these products over time.  Nexxus is a tiny company, so we only bought a few shares.  On a stock like this, we buy only a few shares, if the stock stabilizes and builds a nice lateral consolidation and appears to be ready to go higher, we then add to our shares to get some real bang for the buck.  Right now, the stock is behaving like people are still taking their profits from the big gap up on the news of the product launch.  We may get stopped out on this one if the stock doesn’t shape up.  Today we feel like we pushed the buy button too soon on this one.  The stock moved nicely higher in the afternoon after our purchase, but has since pulled back and shown resilience … until today.  Phooey.  This situation reminds us to WAIT after a gap up to buy shares.

2. Dell, Inc. – Michael Dell – CEO and founder bought over a $150 million of the stock at the market price last Wednesday – Friday, at around $14.20/share.  He’s been working hard at turning the company around and as far as we can tell – what he puts his mind to is generally a strong success.  Yesterday’s earnings revelations at Best Buy, Inc. however, tell us that tablet pc’s and smart phones are selling strongly and laptop sales are dropping.  Dell sells PC’s from their website and tablet pc’s and smart phones (not made by Dell).  So the picture is a bit cloudy.  We’ll see if over time the Dell stock can move higher.  Their earnings are great and Mr. Dell’s own purchases are a good catalyst for moving the stock higher.

3. Nvidia, Inc.  – Nvidia makes the micro-processors that power a lot of smart phones + graphic chip sets that make a lot of computer gamers excited and has pulled back -29% from its recent highs at 26.  This is the first MAJOR pullback in the stock following its blistering run up from last September, and it has a great formation coming off its 200 day moving average.  Buying the first major pullback on a very favorable stock in a very favorable market, off it’s 200 day moving average on big volume is normally a rewarding idea.  This should be a nice, middle of the fairway shot that attracts institutional buyers who missed the first move higher.  We’ll see.

4. Silicon Image, Inc. – Makes innovative chips to connect smart phones and tablets to big screens.  We are going to go ahead and say it …  If they can get some traction … the sky is the limit on a stock with 70 million shares outstanding, little to no debt, and earnings and margins improving.  They just landed the business for the Samsung Galaxy smart phone that we see for sale on the Dell website.  Their new MHL chip line is only now reaching the market.  For those of you who haven’t checked out their website, here it is again. Click on the “Experience it” link on the banner picture on the home page to see what they do with their products.  Under the “About Us” drop-down menu, you can see the investors relation link, which has their financial information… they have built up nice cash reserves over the last year on positive earnings growth.  They are also a small-cap company, which can be very exciting if their products meet a real need in the market at the right time and price point.

After such a heavy shopping spree over the last week, we didn’t want to over do it with a purchase of Zagg, Inc. (ZAGG) yesterday at the 200 day moving average.  They jumped up today +16%.  Our math tells us that the stock is selling for 12x earnings … a real discount for a company with innovative products and a strong growth curve.  We’ll see what next week brings.

Please remember – at the Stock Market Companion we do not and cannot give individual investment advice. According to the State of Washington RCW 21.20.005 the Stock Market Companion is not a Registered Financial Advisor and we do not render any advice on the basis of the specific investment situation of a particular individual. This information is for a wide readership and is not intended for any particular individual,  and under no circumstances should our Market Update or Watchlist be considered an investment recommendation or plan for any specific individual.  By accessing this material, you agree that the Stock Market Companion will not be held liable for any actions taken by a subscriber or other parties.  Please seek the council of a broker or other licensed investment professional for accurate pricing and concerning the suitability of all investments that you may be considering. Disclosure : You understand that the Stock Market Companion holds positions in the above mentioned securities.  Based on market related or personal events these positions may change without notice.

– Stock Market Companion – Performance –

Please click on this chart to see the Stock Market Companion 15MinuteStocks stock performance versus the SP-500.  It will open in a separate browser window.
* Gains (losses) do not include brokerage fees.   Our returns are very strong … BUT …  WE have to remind everyone just like all other financial sites in America – Past Performance is No Guarantee of Future Returns.  Unlike others however, our objective is to teach you to be able to make these types of strong returns On Your Own.

All of the investments – stocks, entries, and exits are listed on our Stock Market Companion Watchlist at the bottom of the spreadsheet, in the section labelled Former Holdings.

– Benchmarks “At a Glance” –

US Dollar	1.4078 USD = 1 Euro	USD / EUR	Dollar = Flat
Gold	$1,421.40	Ounce	Gold =Down a bit
Oil	$103.61	Barrel (West Texas Crude)	Oil = Down a bit
30 Yr. Fixed Mortgage	4.79%	Percent	Flat
10 Yr. Bond Yield	3.448	Percent	Flat
1 Yr. CD	1.16	Percent	Flat

Data Source : Financial Visualizations Inc.

Signing-Off for Today,

Your -Stock Market Companion

** Stock Market Companion Disclaimer **

The Stock Market Companion (SMC) Market Update and Watchlist are published documents to subscribers that show how we (SMC) are viewing the markets and what we are watching, investing in or selling today.  This information is for a wide readership and is not intended for any particular individual,  and under no circumstances should this Market Update or Watchlist be considered an investment recommendation or plan for any specific individual.  By accessing this material, you agree that the Stock Market Companion will not be held liable for any actions taken by a subscriber or other parties.  You understand that the Stock Market Companion holds positions in the above mentioned securities.  Based on market related or personal events these positions may change without notice.

Furthermore, the Stock Market Companion, Inc. is a content provider and publisher and not a registered broker-dealer or licensed investment professional.  Our intent is to publish very accurate market information for an audience of subscribers (1000+ subscribers).  By accessing the Stock Market Companion website and/or using the Stock Market Companion products and services such as this Market Update and accompanying Watchlist, you understand and agree that the material provided in the Stock Market Companion products and services is for informational and educational purposes only, and that no mention of a particular security in a Stock Market Companion product or service constitutes a recommendation to buy, sell, or hold that or any other security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.  To the extent any of the information contained in any Stock Market Companion product or service may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person.  Before selling or buying any stock or other investment you should consult with a qualified broker or other financial professional to verify pricing information and to solicit advice as to the appropriateness of a given transaction or investment.