Move over Don Draper, Google is advertising king
Recapping the day's news and newsmakers through the lens of CNBC.
Google may be getting less dollar per click, but its advertising might has never been more clear than its earnings this week, which sent shares above the $1,000 for the first time today. Quarterly revenue jumped 23 percent. Google credited a surge in mobile and video advertising. The firm has countered a decline in cost-per-click rates with a service that helps advertisers use an efficient mix of smartphones, tablets and desktops. Google's YouTube saw a 75 percent increase in video ads.
"I wouldn't think of selling it here, even though it could trade off a little bit off this pop. ... I still want to own it. Story's intact."—Karen Finerman of Metropolitan Capital Advisors
Just like the Internet boom: Obamacare?
Now that Obamacare has dodged the defunding bullet, it seems fair to ask how investors can make money off the expansion of health insurance. One obvious way is to invest in insurance-related businesses that could get a boost, like EHealth, a public company that owns Ehealthinsurance.com. Its stock has soared 50 percent since July. A year ago it was trading around $20; now it's close to $40.
Venture capital firms are scrambling to fund startups that will help consumers and providers manage healthcare spending. Lots of that money is going into firms that will serve the new health insurance exchanges, or will help doctors and hospitals with paperwork. Also promising are firms with technology to collect data to better manage patients' conditions, like a company that makes a sensor to monitor patients' use of asthma inhalers.
"This is the greatest opportunity I've seen in my lifetime. ... And there's a lot of money that can be made as this chaos is sorted out. ... Just like when the Internet first came about, it was the guys who built routers and servers that made all the money, it will be the guys building the backbones and enterprise software systems for these exchanges that will make a lot of money,"—Lisa Suennen, the co-founder and managing member of Psilos Group, a health-care-focused venture capital firm.
Morgan Stanley's wealth
Managing money for the wealthy has turned out to be an earnings buffer for Morgan Stanley. It beat analyst's estimates with a 50 percent jump in revenue, a day after Goldman Sachs turned in a subpar quarter. Excluding items, the bank earned 50 cents a share, smashing consensus estimates of 40 cents. Higher income from equities sales and trading offset a drop in fixed income—a common problem these days. Morgan Stanley has been trimming that business, and now its acquisition of Smith Barney from Citigroup, completed in June, is looking like a winner, as the bank emphasizes wealth management.
"Morgan Stanley's been going through a turnaround, and in my opinion we saw some convincing evidence of that turnaround in this quarter's results."—Brennan Hawken, UBS director of equity research
No free lunch at Goldman
Even if Goldman Sachs earnings were a disappoint, its ability to capitalize the employee lunch experience is a business success story. Providing a convenient, affordable on-site company cafeteria ought to be a good way to cut down on overly long lunch breaks. But it's maddening to see employees wasting time standing in line during the lunch-hour rush. Goldman Sachs has come up with a market-based solution. To ease that bunching up, Goldman's cafeteria offers 25 percent discounts for meals purchased before 11:30 or after 1:30. For Goldman employees, the noontime break is not "lunch hour," it's the "cost penalty window."
"People are capital to Goldman. It wants to use its capital efficiently. Standing on line waiting for dumplings or salad or a burger is not an efficient use of Goldman's capital."—CNBC's John Carney
—By Jeff Brown, Special to CNBC.com