Finances

Pandora Media, Inc. (P), a popular provider of internet radio services, reported its quarterly earnings on December 4.

The company reported revenue of $120 million for the quarter. This represents an increase of 60% from the same period last year when the company reported revenue of $75 million.

Pandora reported quarterly net income of $2.05 million. This is a substantial increase from the same period last year when the company reported net income of $638,000.

"This quarter exceeded our expectations as we monetized mobile at record levels and grew total mobile revenue 112%," said Joe Kennedy, Chairman and CEO of Pandora. "During the quarter we launched Pandora 4.0, the biggest redesign on the iOS and Android platforms ever, bringing new, innovative and enhanced functionality to mobile devices for the first time for both users and advertisers."

Pandora was founded in 2000 in Oakland, California. The company currently employs 530 people and provides internet radio services to 125 million registered users.

Pandora Media, Inc. (P) shares ended the week at $7.97.

Men's Wearhouse Likes the Look of Quarterly Earnings...Guaranteed

The Men's Wearhouse, Inc. (MW), seller of suits, shirts, slacks and shoes, reported its quarterly earnings on December 5.

The company reported quarterly net sales of $630.97 million. This is an increase of 7.9% from the same period last year when the company reported net sales of $584.6 million.

Men's Wearhouse reported net income of $48.84 million for the quarter. This is an increase of 22% from the same period last year when the company reported net income of $39.88 million.

"Sales at our flagship brand Men's Wearhouse stores, which represented 65% of our total third quarter sales, were above both prior year sales and our plan for the quarter," said Doug Ewert, Men's Wearhouse President and CEO. "Comparable store sales increased 9.5% as our customers responded well to our promotions and value proposition in the third quarter. In addition, our higher margin tuxedo rental revenues had a U.S. comparable store sales increase of 10.9% in the third quarter, driven by increased unit rental rates and unit rentals as well as the absence of the rentals shift last year to the fourth quarter for the 11-11-11 event date."

Men's Wearhouse operates 1,162 retail stores throughout the United States and Canada and employs 12,200 people. The company was founded in 1973 and is based in Houston, Texas.

Men's Wearhouse, Inc. (MW) shares ended the week at $30.48.

The Dow started the week at 13,073 and closed at 13,155. The S&P 500 started the week at 1,420 and ended at 1,418. The NASDAQ started the week at 3,030 and finished at 2,978.

The Labor Department released its monthly jobs report on December 7. The report showed the U.S. added 146,000 jobs in November, lowering the unemployment rate to 7.7%. The unemployment rate has been above 8% since February 2009. With this news, yields on benchmark 10-year notes rose to 1.63%.

Most economists predicted that Superstorm Sandy would cause November's employment numbers to be unusually low. The employment report was forecast to show the U.S. only adding 85,000 jobs in November. However, the actual numbers almost doubled expectations.

"The two headline numbers, the unemployment rate and the amount of jobs that were created, point to a gradual healing of labor markets," said Mohamed El-Erian, CEO at PIMCO. "But if you look at the details, long-term unemployment, youth unemployment, participation rate, they tell you we are not at critical masses yet."

"The prolonged fiscal-cliff uncertainty and the expectation of further accommodation by the Federal Reserve is keeping a lid on how high yields can rise," said Donald Ellenberger, Co-Head of Government and Mortgage-Backed Securities at Federal Investors, Inc.

The large drop in the unemployment rate this month brings another question to the forefront. The Federal Reserve has promised to buy bonds until the market improves substantially. From 2008 to 2011 the Fed purchased $2.3 trillion in Treasury and mortgage related debt. Whether the Federal Reserve plans to engage in another round of quantitative easing will likely be part of the discussion at the Federal Open Market Committee's next meeting on December 11-12.

The 10-year Treasury note yield finished the week at 1.63% while the 30-year Treasury note yield finished the week at 2.81%.

Freddie Mac released the results of its weekly Primary Mortgage Market Survey on December 6. This week's results show mortgage rates remaining near record lows.

The 30-year FRM averaged 3.34% this week. This represents an increase from last week when it averaged 3.32%. Last year at this time, the 30-year FRM averaged 3.99%.

The 15-year FRM averaged 2.67% this week. This is an increase from last week when it averaged 2.64%. One year ago at this time, the 15-year FRM averaged 3.27%.

Frank Nothaft, Vice President and Chief Economist at Freddie Mac, stated, "Mortgage rates were little changed and near record lows this week amid indicators of stronger economic growth and signs of tame inflation. Third quarter real GDP growth was revised from an initial report of 2% to 2.7%, nearly matching the market consensus forecast. Meanwhile, the 12-month growth rate of the core price index of consumer expenditures remained at 17% in October which is on the low end of the Federal Reserve's projection range for this year. The housing market is aiding in this recovery. For instance, fixed residential investment added positive growth over the past six consecutive quarters and in the third quarter alone contributed 0.3 percentage points to real GDP growth. In addition, residential construction spending was up 3% between September and October. And, pending home sales saw a 5.2% increase in October to its highest reading since March 2007."

The money market fund finished this week at 0.5%. The 1-year CD finished at 0.7%.