Struggle or Soar?

Glaser: They had a really good quarter, and I think it really comes down to what our analyst R.J. Hottovy talks about, that eBay is really becoming completely central to facilitating transactions both online, and increasingly offline as well.

They had really good growth in their PayPal unit. More and more people are using PayPal to pay for really almost anything across both eBay's traditional auction universe, but also on other sites online and increasingly through mobile payments ... at brick-and-mortar stores. So, I think that it's an interesting trend to watch eBay continue to expand into all parts of the merchant business and to really all parts of the transaction.

At the same time, their auction business is doing pretty well, too. For a business that had been under such pressure a few years ago, it's really turned around, and it's also producing nice results for them. So, eBay really had a strong quarter and was soaring in 2011.

Stipp: As the Republican primaries continue on, we can't seem to escape the news about what's going on in South Carolina and those early races.

What should investors be thinking about, though, about who might come out of this really soaring, and who is still going to be struggling, and what it might mean for them?

Glaser: It's really been a struggle just to keep track of the Republican presidential nomination. It's really been an incredibly volatile race, and one where we have had a lot of new front-runners. We talked about this before that certainly it's one of the most dynamic races that we've seen in a long time. And even though Mitt Romney looked like he was cruising to wrapping things up relatively early, as we approach tomorrow's primary in South Carolina, there are a lot of questions about exactly what's going to happen. Rick Perry dropped out, and he has endorsed Newt Gingrich. Gingrich has really seen a surge in his polling going into voting on Saturday. Rick Santorum certainly can't be counted out. Ron Paul also has some very dedicated supporters who are ... going to be out there in force in South Carolina.

So as we hear a lot of infighting back and forth and a lot of discussion about different candidates' economic plans and really how they would view their administration, how they would run the country if they were president, I think it's easy to get caught up as investors in trying to figure out, "oh, does that mean I shouldn't invest in this sector or I should be more interested in investing in that sector."

I think it's really too early to be trying to make those kind of decisions. I think that each administration, depending on which Republican nominee wins and if they were to win the presidency, would probably do things a little bit differently, but I think it's way too early to figure out exactly what they would do. A lot of it is going to depend on what the makeup of Congress looks like, and what they're willing to and what they want to do.

So I think instead of focusing too much on it. It's just good to kind of stay looking at the fundamentals, figure out what companies are going to have good growth prospects no matter no matter what happens in the political realm.

So, certainly, it's a fun race to watch. It's good to keep an eye on it maybe just for political junkies out there. But I think for investors, it's too early to be making any big moves based on what's happening now.

Stipp: In the tech sector, Jeremy, we saw that Apple made a really interesting move in schools. Will this put them at the head of the class?

Glaser: Apple has been a big player in education for a while, and I think they certainly would love to get an iPad in the hand of every high school and middle school student across the United States. They made a big push here by introducing iBooks 2 and eTextbooks and ways of getting the major textbook manufacturers to start releasing their new editions every year for about $15 a student, so that instead of having to lug around lots of books, they can now have a colorful interactive way to kind of control their educational content.

I think it certainly is a very interesting product, but I don't think it's [assuredly] destined for success. I think it's going to be a struggle to get school districts to approve the money to get iPads for all of the students. Certainly school budgets are not exactly booming at the moment, and I think that trying to get all that money to get the devices is going to be a struggle in many districts. I think the idea of having to buy individual copies for each student, even if they are reasonably priced, is maybe a little bit less easy than if you're buying just a single textbook that you can use five or six years in a row for multiple students. So I think that it's an area that has a lot of potential, but it's not going to be a short-term catalyst. I think it's going to take them a long time to really make in-roads into that textbook market.

Stipp: Lastly, Jeremy, in telecom, AT&T really struggled recently with an acquisition they were hoping to make. What's the path forward look like for them? Are they going to be able to soar again?

Glaser: It's been a struggle for AT&T. I think they had really put a lot of their eggs in the T-Mobile basket. They had hoped that by taking over the small competitor they would, A, get those customers, but also get that spectrum that they really need in order to expand their network strength and get rid of the some of the continuous complaints about the quality of their data network and the quality of their voice network.

With that deal being scuttled by federal regulators, they now are somewhat having to go back to the drawing board to figure out how are they going to increase profitability, how are they going to continue to improve, particularly in the face of pretty strong competition from Verizon Wireless.

So this week they decided that they were going to raise the prices on the entry level of their data tiers for new customers for now. This is just a way to try to get a little bit more money out of their subscriber base and a way to try to price their data maybe a little bit closer to what it's actually costing them to [provide].

But at the same time it doesn't really solve some of their core issues that they really need to get more spectrum, they really need to build out their network, they really need to make those investments, if they want to keep AT&T a viable option for people.

I think particularly as devices become more standardized, with the iPhone on almost every network, the high-end Android phones are showing up, and very similar phones are showing up across the network. It's going to be easy to move from carrier to carrier. I think AT&T is certainly going to have to struggle and is certainly going to have to work hard in order to continue to keep its customers.

Stipp: Jeremy, thanks for helping the Friday Five soar on its trajectory again this week.

Glaser: You're welcome, Jason.

Stipp: For Morningstar, I'm Jason Stipp. Thanks for watching.