Friday, January 31, 2014

Men’s Wearhouse offers to buy Jos. A. Bank

The suit wars are heating up on Wall Street. But which suit retailer fits?

The Men's Wearhouse offered to buy Jos. A. Bank Clothiers Tuesday, turning the tables on an apparel retailing rival that has been trying to take it over.

The Men's Wearhouse proposed to acquire Jos. A. Bank for $55 per share in cash, representing an implied enterprise value of approximately $1.2 billion.

The Men's Wearhouse said its takeover offer is a 32% premium over Jos. A. Bank's closing share price on Oct. 8, 2013, the day before Jos. A. Bank proposed to buy Men's Wearhouse.

Jos. A. Bank shares jumped 11% to $56.32 in pre-market trading Tuesday. Men's Wearhouse shares climbed 8% to $50.90.

"We are the right acquiror for this combination and that our experienced management team is best positioned to execute the integration of our companies and achieve the synergies that would result," said Bill Sechrest, lead director of the board of Men's Wearhouse.

A combination of the two companies would create the fourth largest U.S. men's apparel retailer, with more than 1,700 total stores and annual sales of more than $3.5 billion, Men's Wearhouse said.

Top Gold Stocks To Own For 2015

The company forecast that the combination would create about $100 million to $150 million of annual synergies over three years through more efficient purchasing, customer service and marketing, and streamlining corporate functions. The deal will add to Men's Wearhouse's earnings in the first year following closing, it added.

Men's Wearhouse said it plans to pay for the deal with existing cash from its balance sheet and borrowed money.

Thursday, January 30, 2014

Barrick Gold Hat Trick: Mega-Stock Sale To Pay Debt

You have heard of robbing Peter to pay Paul, but how about diluting equity to wipe out debt? Barrick Gold Corporation (NYSE: ABX) was already lower after earnings by 5.4%, and it has taken on a new twist. Now the gold giant is conducting a huge equity offering in order to pay down debt.

The company announced on Thursday afternoon that it has entered into an underwriting agreement with RBC Capital Markets, Barclays, and GMP Securities for roughly $3.0 billion. Barrick is signaling that this represents 163.5 million common shares and the sale is taking place at $18.35 per share. Again, this is after a 5.4% drop and shares fell another 2.5% down to $18.45 on the news.

Barrick has a market cap of $19.4 billion and that is after the stock has fallen in half from its 52-week high. This 163 million shares or so is also representative of ten trading days of volume.

The gold giant has also granted the Underwriters an over-allotment option of up to 24.5 million common shares. If the overallotment is exercised then the full share sale will amount to $3.45 billion. Net proceeds from the offering will be lose to $2.9 billion after underwriting fees.

Barrick’s common shares outstanding will increase from about 1.0 billion shares currently up to about 1.16 billion shares after the offering. That figure would be 1.19 billion shares if the over-allotment option is exercised in full. The company’s balance sheet strengthening will come from paying down debt. Some $2.6 billion will be used for this as follows:

Approximately $1.1 billion of the net proceeds of the offering to redeem the outstanding $700 million aggregate principal amount of 1.75% notes due 2014 issued by Barrick, together with the $350 million aggregate principal amount of 4.875% notes due 2014 issued by Barrick Gold Finance Corporation and guaranteed by Barrick. Approximately $1.5 billion of the net proceeds of the offering to purchase notes in a proposed tender offer.

Barrick Gold managed to beat earnings expectations earlier in the day, but the share weakness is on the heels of a decision to temporarily suspend construction activities at Pascua-Lama. Barrick had some $23.829 billion in total debt as of September 30, and only $3.353 billion of that was short-term liabilities.

Wednesday, January 29, 2014

5 Stocks With Poor Earnings Momentum — FNBN MTGE MLNX PNX SHLD

RSS Logo Portfolio Grader Popular Posts: 4 Pharmaceutical Stocks to Buy Now8 Oil and Gas Stocks to Buy Now5 Pharmaceutical Stocks to Buy Now Recent Posts: 6 Biotechnology Stocks to Buy Now 4 Commercial Services Stocks to Buy Now 33 Commercial Banking Stocks to Buy Now View All Posts

This week, these five stocks have the worst ratings in Earnings Momentum, one of the eight Fundamental Categories on Portfolio Grader.

FNB United () is a bank holding company. FNBN gets F’s in Equity and Cash Flow as well. .

American Capital Mortgage Investment Corp. () invests in, finances, and manages a portfolio of mortgage-related investments, such as agency mortgage investments, non-agency mortgage investments and other mortgage-related investments. MTGE also gets F’s in Earnings Growth, Earnings Surprises, Cash Flow, Operating Margin Growth and Sales Growth. The stock has a trailing PE Ratio of 127.70. .

Mellanox Technologies, Ltd. () designs and develops semiconductor-based, high-performance interconnect products. MLNX also gets F’s in Earnings Growth, Earnings Surprises, Operating Margin Growth and Sales Growth. Since January 1, MLNX has fallen 2%. This is worse than the Nasdaq, which has remained flat. The stock currently has a trailing PE Ratio of 880.70. .

The Phoenix Companies, Inc. () is the holding company of Phoenix Life Insurance Company. PNX also gets F’s in Earnings Growth and Sales Growth. The price of PNX is down 26.1% since the first of the year. .

Sears Holdings Corporation () is a retail conglomerate with full-line and specialty retail stores. SHLD gets F’s in Analyst Earnings Revisions, Equity, Cash Flow and Sales Growth as well. Since January 1, SHLD has fallen 16.8%. .

Louis Navellier’s proprietary Portfolio Grader stock ranking system assesses roughly 5,000 companies every week based on a number of fundamental and quantitative measures. Stocks are given a letter grade based on their results — with A being “strong buy,” and F being “strong sell.” Explore the tool here.

Monday, January 27, 2014

Genworth Taps Industry Veteran Charles Goldman for Board of Directors

Genworth Financial Wealth Management announced Monday that it has established a governing board of directors that will include prominent asset management industry veteran Charles Goldman as its appointed chairman. Also tapped to serve on the board are Hal Strong of Genstar Capital and Steven Spiegel of Aquiline Capital Partners.

Located in Pleasant Hill, Calif., Genworth Financial Wealth Management in September moved forward as an independent company with the completion of its sale from Genworth Financial (GNW) to a partnership of the two private equity firms, Aquiline and Genstar.

New board chairman Goldman, known as an advocate for the fiduciary standard, co-founded the now defunct RIA cooperative Advizent with Steve Lockshin and counted Vanguard founder John Bogle as a board member.  Prior to Advizent’s closing in March, Goldman had previously served as president of custody and clearing at Fidelity Investments, as well as head of Schwab Institutional, among other senior roles at The Charles Schwab Corp.

“We are pleased to partner with directors of this caliber and be able to draw on their vast experience in wealth management and advisory services. I look forward to working with Charles, Hal and Steven to ensure that we continue to enhance our capabilities for advisors and their clients,” said Gurinder S. Ahluwalia, president and CEO of Genworth Financial Wealth Management, in a statement.

Goldman was also a consultant at The Boston Consulting Group, and has served on boards of companies and associations, including his current service on the Certified Financial Planner Board of Standards and the board for Personal Capital Corporation.

“I’m excited to be working with the Genworth Financial Wealth Management team,” Goldman said in a statement. “Having spent much of my career serving advisors, I look forward to using my experience to help the team and other directors continue to deliver sophisticated solutions and industry-leading service to the firm’s clients.”

Strong has served in senior roles across the asset management and investment banking industries over the last 30 years and is now an operating executive at Genstar Capital. Previously, he was vice chairman of Russell Investments, where he had an 18-year career. At Russell, he also served as chief operating officer, chief financial officer, head of alternative investments and head of investment banking.

Spiegel is a partner at Aquiline Capital Partners and has extensive experience leading asset management firms. He was previously vice chairman of Putnam Investments and director of corporate development at Marsh & McLennan Cos. Spiegel also served as chairman of PanAgora Asset Management and as a director of Mercer Management Consulting and Nippon Life Asset Management Co. 

Hot Financial Stocks For 2015

Read Genworth, Cetera Close Unit Sales Deals at ThinkAdvisor.

Sunday, January 26, 2014

Time to Go Against the Grain With Dendreon (DNDN)

There's no doubt about it - the "in" thing to do with Dendreon Corporation (NASDAQ:DNDN) lately has been to bash it. The company's one and only drug, Provenge, failed to meet its sales estimates last quarter. And worse, DNDN was forced to announce 2013's top line wouldn't be as strong as first expected. Between that lowered guidance and growing fears that Provenge may not be nearly as marketable as first assumed, the stock plunged 26% on Friday, and has since widened that loss to 30%.

Oh yeah... the media now hates the stock and the company too, judging from the skewering its handed over to Dendreon in the meantime. Time to buy.

Yes, you read that right - it's time to buy DNDN, even though it feels like you're trying to catch a falling knife by doing so. Undoubtedly you're looking for some sort of explanation. Here it is. Though sales of prostate cancer drug Provenge are already starting to wane after its 2010 launch, they're not in as much jeopardy as the recent action may suggest.

For perspective, the company generated $325.3 million in sales in 2012, almost all of which was driven by Provenge. Though Dendreon has only said it will not be able to post as big of a number for this year, some analysts foresee $314 million in revenue for this year. The loss could end up being bigger than the revenue total in 2013, and given how the company has burned about 1/3 of its cash over the past four quarters - leaving behind a mere $280 million - it's possible liquidity could become a problem around this time in 2014.

So what's the upside with DNDN in that? Because that worst-case scenario (and then some) may well already be baked into the stock's price.

Even with all of its problems, Dendreon's Provenge still has a couple of things going for it.

One of them is the fact that there's still no dedicated prostate cancer drug (built from the ground up to treat the condition) other than Provenge. Others are used to fight it, and new options are in the pipeline, but Provenge is the only one that is first and foremost a prostate cancer therapy. That may boost sales again in the future. [Sales could have surged through 2012 simply because it was new and patients were excited to request it. Though the euphoria phase has died, the functional phase is still getting started.]

The other idea in support of Provenge's positive future is that, despite what's near a six-figure price tag, Dendreon Corporation has managed to convince Medicare and most insurers to reimburse caregivers for the treatment. That's huge.

And, with a market cap of around $500 million, the projected Provenge sales are "about right." The marketwide average price/sales ratio is 2.4, while Dendreon's is around 2.0 (though it seems to change quite a bit).

Yes, there are pitfalls still lingering out there, and DNDN may well be one of the most hated names in the world right now. That's often when bottoms are made... when there's nobody left to bet against it. The worst-case scenario is fully factored into the stock's price. From here, things can only get better. Dendreon's ace in the hole is the fact that it's still got a small but compelling pipeline. 

Would you like to get more trading ideas and insights like this one every day? Then become a subscriber to the free daily SmallCap Network newsletter. You'll get picks, market calls, and more.

Saturday, January 25, 2014

Top 10 Asian Companies To Buy For 2015

LOS ANGELES (MarketWatch) -- Japanese stocks weakened in early Thursday trading as the yen rose and Wall Street ended mixed, with the Nikkei Stock Average (JP:NIK) falling 1.2% to 15,929.74 after a 1.9% advance a day earlier. With the yen (USDJPY) slightly firmer than in the previous session, some investors sold currency-sensitive exporters, with Fanuc Corp. (JP:6954) (FANUF) down 2%, Kyocera Corp. (JP:6971) (KYOCF) off 1.9%, and Fujitsu Ltd. (JP:6702) (FJTSY) losing 2.3%. News that China would lift a ban on some sales of videogame consoles had sent shares of Nintendo Co. (JP:7974) (NTDOF) shooting 11% higher on Wednesday, but apparent profit-taking sent the stock down 4.2% in early Thursday action. Shares of rival Sony Corp. (JP:6758) (SNE) , however, followed with a 4% rise, also possibly buoyed by a Nikkei Asian Review report that it was planning a "smartphone offensive" in the U.S. and China. Canon Inc. (JP:7751) (CAJ) fell 2% on a separate Nikkei report that the company's 2013 operating profit would miss forecasts. Toshiba Corp. (JP:6502) (TOSYY) rose 2% as U.S. audio firm Skullcandy Inc. (SKUL) said the Japanese conglomerate would license the Skullcandy name for use in marketing laptops. Retailers also traded mostly weaker, with stock in Fast Retailing Co. (JP:9983) (FRCOF) retreating 2.9% ahead of its quarterly earnings.

Top 10 Asian Companies To Buy For 2015: Semgroup Corporation(SEMG)

SemGroup Corporation provides gathering, transportation, storage, distribution, blending, marketing, and other midstream services primarily to independent producers, refiners of petroleum products, and other market participants in the Midwest and Rocky Mountain regions of the United States, Canada, and the West Coast of the United Kingdom. It also purchases, stores, and sells natural gas liquids in the United States; provides natural gas gathering and processing services in Canada and the United States; offers refined products and crude oil storage services in the United Kingdom; and purchases, produces, stores, and distributes liquid asphalt cement products in Mexico. The company owns, contracts, and leases various pipelines, gathering systems, storage facilities, terminals, processing plants, blending facilities, and other distribution assets. It operates approximately 1,400 miles of natural gas transportation, gathering, and distribution pipelines in Kansas, Oklahoma, T exas and Alberta, Canada. The company was founded in 2000 and is headquartered in Tulsa, Oklahoma.

Advisors' Opinion:
  • [By Holly LaFon]

    In early August SemGroup (SEMG), an owner and operator of oil and gas midstream assets, including pipelines and storage and blending facilities, closed on an opportunistic purchase of assets from Chesapeake Energy. The assets nicely complement SemGroup's existing core assets that stretch from Colorado to Oklahoma. While SemGroup will have to spend money to complete the assets��oney that financially distressed Chesapeake likely could not justify��e view the expenditures favorably given their high return characteristics.From Third Avenue Management's fourth quarter 2013 commentary.

  • [By Aimee Duffy]

    At this point, it's not really news when Chesapeake Energy (NYSE: CHK  ) reports that it's selling assets to anyone who will buy them. The company's quest to scrape together $4 billion to $7 billion to cover its budget shortfall this year has it in the news seemingly every other week. In this video, Fool.com contributor Aimee Duffy discusses Chesapeake's most recent divestiture, and why the real winner in this $300 million deal is the buyer: Tulsa's SemGroup (NYSE: SEMG  ) .

Top 10 Asian Companies To Buy For 2015: Teledata (SINGAPORE)

Teledata (Singapore) Limited operates as an information technology systems integrator and communications services company. The company specializes in IP-based communications network, and security and surveillance systems. It provides technical, advisory, consultancy, and agency services in the areas of management information systems, information technology, and telecommunication. In addition, the company is involved in the importation, distribution, installation, system integration, and maintenance of voice, data, telecommunication equipment, and video communications equipment, software, and supplies, as well as sale of digital marketing solutions and services. It serves large and small enterprises, and telecommunication carriers. The company operates primarily in Singapore, Indonesia, Thailand, and the Philippines. Teledata (Singapore) Limited was founded in 1976 and is headquartered in Singapore.

Top Gold Stocks To Own For 2015: Brazilian Real(BK)

The Bank of New York Mellon Corporation, a financial services company, provides various products and services worldwide. The company offers a range of equity, fixed income, cash, and alternative/overlay products, as well as distributes investment management products. It also provides investment management, wealth and estate planning, and private banking solutions to high-net-worth individuals and families, charitable gift programs, endowments and foundations, and related entities, as well as offers mutual funds, separate accounts, and annuities. In addition, the company provides global custody and fund, securities lending, investment manager outsourcing, performance and risk analytics, alternative investment, securities clearance, collateral management, corporate trust, broker-dealer, and employee investment plan services, as well as clearing services and global payment/working capital solutions to institutional clients. Further, it offers American and global depositary re ceipt programs, cash management solutions, payment services, liquidity services, foreign exchange, global clearing and execution, managed account services, and global prime brokerage solutions to corporations, public funds, government agencies, foundations, and endowments; global financial institutions, including banks, broker-dealers, asset managers, insurance companies and central banks; and financial intermediaries, independent registered investment advisors, and hedge fund managers. Additionally, the company provides credit-related services, and global markets and institutional banking services; engages in business exits, and corporate treasury activities; and leases financing portfolios. The Bank of New York Mellon Corporation was founded in 1784 and is headquartered in New York, New York.

Advisors' Opinion:
  • [By Alex Planes]

    Another banking match made in heaven
    JPMorgan wasn't the only bank to get bigger on July 1: Bank of New York Mellon (NYSE: BK  ) was formed by the merger of BNY and Mellon on July 1, 2007. Popularly known as BNY Mellon, the new financial company combined deep historical roots and immense financial management assets.

Top 10 Asian Companies To Buy For 2015: Regent Ventures Ltd. (REV.V)

Regent Ventures Ltd., a junior resource company, engages in the acquisition, exploration, and development of mineral resource and oil and gas properties in Canada and the United States. It primarily explores for gold and other precious metals. The company holds interest in the Red Mountain property, situated in the Mayo Mining District, Yukon Territory; the Owyhee property, located in north Elko County, Nevada; and an oil and gas lease located in Louisiana. Regent Ventures Ltd. was incorporated in 1986 and is based in Vancouver, Canada.

Top 10 Asian Companies To Buy For 2015: Osage Exploration and Development Inc (OEDV)

Osage Exploration and Development, Inc. (Osage) is an oil and natural gas exploration and production company with reserves and production in the country of Colombia and the state of Oklahoma. The Company�� pipeline is located in Colombia. The Companys focuses on developing its 28,000-acre Horizontal Mississippian block along the Nemaha Ridge in Logan County, Oklahoma, with their partners Slawson Exploration, and U.S. Energy Development Corp. The Company generates oil sales from its production operations in Colombia and in the state of Oklahoma and pipeline revenues from its Cimarrona property in Colombia. During the year ended December 31, 2011, the Company drilled two salt water disposal wells and commenced drilling the Wolfe#1-29H, the Company�� horizontal Mississippian well in Logan County, Oklahoma. In January 2012, the Company began drilling the Krittenbrink 2-36H, the Company�� second well in Logan County.

The Company�� subsidiary, Cimarrona LLC, owns a 9.4% interest in certain oil and gas assets in the Guaduas field, located in the Dindal and Rio Seco Blocks that consist of 21 wells, of which seven are producing, that covers 30,665-acres in the Middle Magdalena Valley in Colombia, as well as a pipeline with a capacity of approximately 30,000 barrels of oil per day. The Cimarrona property, but not the pipeline, is subject to an Ecopetrol Association Contract (the Association Contract) whereby the Company pays Ecopetrol S.A. (Ecopetrol) royalties of 20% of the oil produced.

The Company has acquired oil and gas leases in Logan County, Oklahoma targeting the Mississippian formation. The Mississippian formation is located on the Anadarko Shelf in northern Oklahoma and south-central Kansas. The top of this expansive carbonate hydrocarbon system is encountered between 4,000 and 6,000 feet and lies stratigraphically between the Pennsylvanian-aged Morrow Sand and the Devonian-aged Woodford Shale formations. The Mississippian formation reach 600 feet in gross thickness a! nd the targeted porosity zone is between 50 and 300 feet in thickness. The Company owns 100% of the working interest in certain producing oil and natural gas leases located in Osage County, Oklahoma (Hopper Property). The Property consists of 23 wells, 10 of which are producing wells, on 480 acres.

Advisors' Opinion:
  • [By CRWE]

    Today, OEDV surged (+1.96%) up +0.03 at $1.56 with 178,129 shares in play thus far (ref. google finance Delayed: 12:28PM EDT August 30, 2013).

    Osage Exploration and Development, Inc. previously reported preliminary production results on the Mallard 1-16H Horizontal Mississippian well in Logan County, Oklahoma. The well, located in Section 16-17N-3W, achieved a 24-hour peak initial production rate of 705 barrels of oil plus associated natural gas on an electric submersible pump and a 48/64��choke.

  • [By CRWE]

    Today, OEDV surged (+6.78%) up +0.08 at $1.26 with 39,220 shares in play thus far (ref. google finance Delayed: 11:56AM EDT August 22, 2013).

    Osage Exploration and Development, Inc. previously reported financial results for the three months ended June 30, 2013 and provided an update on field operations. For the quarter, the Company reported a 75.8% increase in revenues of $2.4 million compared to the same period in 2012, and operating income of $1.2 million versus a loss of $274,563 for the period ending June 30, 2012.

    Osage participated in drilling ten wells during the second quarter, bringing the total number of wells in which Osage has an interest to twenty-nine as of June 30, 2013. Additionally, the Company reported average daily production roughly in-line with first quarter production.

Top 10 Asian Companies To Buy For 2015: Rockwell Collins Inc (COL)

Rockwell Collins, Inc. (Rockwell Collins), incorporated on March 1, 2001, is engaged in design, production and support of communications and aviation electronics for commercial and military customers worldwide. The Company�� products and systems are primarily focused on aviation applications, The integrated system solutions and products it provide to its served markets include communications, navigation, automated flight control, displays/surveillance, simulation and training, integrated electronics and information management systems. The Company also provides a range of services and support to its customers through a network of service centers, including equipment repair and overhaul, service parts, field service engineering, training, technical information services and aftermarket used equipment sales. The Company operates in two segments: Government Systems and Commercial Systems.

Government Systems

The Company�� Government Systems business provides a range of electronic products, systems and services to customers, including the United States Department of Defense, other ministries of defense, other government agencies and defense contractors around the world. These products, systems and services support airborne, precision weapon, ground and maritime applications and are used in line-fit applications on new equipment, as well as in retrofit and upgrade applications designed. The Company�� defense-related systems, products and services include communications systems and products designed to enable the transmission of information across the communications spectrum, including satellite communications; navigation products and systems, including radio navigation products, global positioning system (GPS) equipment, handheld navigation devices and multi-mode receivers; avionics sub-systems for aircraft flight decks that combine flight operations with navigation and guidance functions that can include flight controls and displays, information/data processing and communicat! ions, navigation, safety and surveillance systems; cockpit display products, including multipurpose flat panel head-down displays, wide field of view head-up and helmet-mounted displays; simulation and training systems, including visual system products, training systems and services, and maintenance, repair, parts and after-sales support services.

Avionics consists of electronic solutions for a range of airborne platforms, including fixed and rotary wing aircraft, unmanned aerial vehicles (UAVs) and the associated aircrew and maintenance training devices and services. The Company provides complete avionics solutions (including cockpit avionics, mission system applications and system integration) and also provides individual avionics products to platform integrators. The Company serves various roles within these markets, including system and subsystems integrator, as well as provider of various electronic products. Communication products include spectrum voice and data connectivity for government and military use in the air, on the ground and at sea. Surface solutions include electronic systems applied to a variety of non-airborne market segments.

Commercial Systems

The Company�� Commercial Systems business supplies aviation electronics systems, products and services to customers located throughout the world. The customer base is consists of original equipment manufacturers (OEMs) of commercial air transport, business and regional aircraft, commercial airlines and business aircraft operators. The Company�� systems and products are used in both OEM applications, as well as in retrofit and upgrade applications designed.

The Company�� commercial aviation electronics systems, products and services include integrated avionics systems, such as Pro Line Fusion. Capabilities include synthetic and enhanced vision enabled flight displays, advanced flight and performance management systems, fly-by-wire integrated flight controls and information management! solution! s to improve operational efficiency; integrated cabin electronics systems, including cabin management systems, passenger connectivity and entertainment solutions, business support systems to improve passenger productivity and passenger flight information systems; communications systems and products, such as data link, high frequency, very high frequency and satellite communications systems; navigation systems and products, including landing sensors to enable automatic landings, radio navigation and geophysical sensors, as well as flight management systems; situational awareness and surveillance systems and products, such as synthetic and enhanced vision systems, surface surveillance and guidance solutions, head-up guidance systems, weather radar and collision avoidance systems; integrated information management solutions to improve the overall efficiency of flight, maintenance and cabin operations. These include on-board information management systems and connectivity solutions, airborne and ground applications and services, and ground infrastructure and services; electro-mechanical systems, including integrated pilot control solutions and primary and secondary actuation systems; simulation and training systems, including full-flight simulators for crew training, visual system products, training systems and engineering services, and maintenance, repair, parts, after-sales support services and aftermarket used equipment.

Air transport aviation electronics include avionics, cabin systems and flight control systems for commercial transport aircraft platforms. Business and regional aviation electronics include integrated avionics, cabin management and flight control systems for application on regional and business aircraft platforms. The Company develops integrated avionics, cabin and flight control solutions for business and regional aircraft OEMs and support them with the integration into other aircraft systems. Products offered for OEM applications in the business and regional aircraft cate! gory are ! marketed directly to the aircraft OEMs.

The Company competes with Honeywell International, Inc., Thales S.A., Panasonic, Raytheon Co., Harris Corp., BAE Systems Aerospace, Inc., General Dynamics Corporation, L3 Communications, Inc., The Boeing Company, Northrop Grumman Corp., CAE Inc., General Electric Co. and Garmin International Inc.

Advisors' Opinion:
  • [By Lu Wang]

    Rockwell Collins (COL) sank 4.9 percent to $70.61. The maker of airplane cockpit instruments forecast revenue in fiscal 2014 will be no more than $4.60 billion. That missed the average analyst estimate of $4.93 billion in a Bloomberg survey.

  • [By Rich Smith]

    The Department of Defense awarded Rockwell Collins (NYSE: COL  ) a sizable "foreign military sales contract" on Monday.

    Rockwell will upgrade a total of three Boeing (NYSE: BA  ) KC-135R aerial refueling tankers for the French Air Force under a $44.5 million firm-fixed-price contract, installing the KC-135 Global Air Traffic Management Block 40 Upgrade for the airplanes. Work on the contract will be completed by Nov. 10, 2015.

Top 10 Asian Companies To Buy For 2015: Carrs Milling Ind(CRM.L)

Carr?s Milling Industries PLC, together with its subsidiaries, engages in agriculture, food, and engineering activities. The company supplies new and used farming machinery, farming supplies, country living products, fuels, and lubricants to farming and rural communities; manufacturers and supplies a range of products for farm livestock, crystalyx, horslyx, coparods, and bacto-col through distributor network in the United Kingdom, rest of Europe, the Middle East, and North America; develops and supplies nutritional supplements to farmers in the United Kingdom; and manufactures feed supplements. It also processes and sells cereals to bakers, food manufacturers, and retailers. In addition, the company designs and manufactures process plant and equipment for the petrochemical, oil and gas, nuclear power, pharmaceutical, process, and water industries; and remote handling equipment for use in research and nuclear industries. Further, it provides vehicle body building, repairs, servicing, conversions, painting, and signwriting for cars and commercial vehicles; and radiation protection products. Additionally, the company is involved in the retail sale of farm equipment, fuels, and farm consumables; and operates as an importer and wholesale supplier of protective clothing, footware, and tools. It also provides financial services and engages in property holding activities. The company was founded in 1831 and is based in Carlisle, the United Kingdom.

Top 10 Asian Companies To Buy For 2015: STR Holdings Inc(STRI)

STR Holdings, Inc., together with its subsidiaries, designs, develops, manufactures, and sells encapsulants for the solar industry worldwide. Its encapsulants protect the embedded semiconductor circuits of solar panels. The company sells its products to crystalline silicon and thin-film solar module manufacturers. STR Holdings, Inc. was founded in 1944 and is headquartered in Enfield, Connecticut.

Top 10 Asian Companies To Buy For 2015: Mesa Laboratories Inc.(MLAB)

Mesa Laboratories, Inc. designs, manufactures, and markets instruments and disposable products utilized primarily in healthcare, pharmaceutical, food and beverage, medical device, and petrochemical industries. The company offers DATATRACE data loggers that are used in critical manufacturing, quality control, and validation applications to measure temperature, humidity, and pressure inside a process or inside a product during manufacturing; and biological indicators and chemical indicators used to assess the effectiveness of sterilization processes, including steam, gas, hydrogen peroxide, and radiation under the Mesa, Apex, SGM Biotech, and Raven brands. It also provides Torqo torque testing systems, which are used to measure bottle cap tightness in the beverage and pharmaceutical industries; Medical meters, which are used for quality control in dialysis clinics and dialysis machine manufacturing operations; and Nusonics concentration analyzers, pipeline interface detector s, and flow meter products used in the chemical, food, pharmaceutical, and plastics industries. It sells its products through direct sales, marketing staff, and distributors in the United States, Europe, Africa, Australia, Asia, South America, Canada, and Mexico. Mesa Laboratories, Inc. was founded in 1982 and is headquartered in Lakewood, Colorado.

Top 10 Asian Companies To Buy For 2015: Atlantic American Corporation(AAME)

Atlantic American Corporation, through its subsidiaries, provides life, health, property, and casualty insurance products in the United States. Its property and casualty insurance products include business automobile insurance coverage for state governments, local municipalities, and other large motor pools and fleets, as well as personal property, inland marine, and general liability insurance products. The company also provides surety bond coverage for school bus transportation and subdivision construction, as well as performance and payment bonds. In addition, it offers ordinary and term life insurance, Medicare supplement, and other accident and health insurance products. The company markets its policies through independent agents. Atlantic American Corporation was founded in 1968 and is based in Atlanta, Georgia.

Top 10 Asian Companies To Buy For 2015: Lexicon Pharmaceuticals Inc.(LXRX)

Lexicon Pharmaceuticals, Inc., a biopharmaceutical company, focuses on the discovery and development of drug candidates for the treatment of various human diseases. The company utilizes gene knockout technologies and an integrated platform of medical technologies to systematically study the physiological and behavioral functions of approximately 5,000 genes in mice and assessed the utility of the proteins encoded by the corresponding human genes as drug targets. Its portfolio of orally-delivered small molecule compounds that have completed or are presently conducting phase 2 clinical trails includes LX4211 for the treatment of type 2 diabetes; LX1031 for the treatment of irritable bowel syndrome and other gastrointestinal disorders; LX1032 for the treatment of the symptoms associated with carcinoid syndrome; and LX2931 for the treatment of rheumatoid arthritis and other autoimmune diseases. The company also develops LX1033, an orally-delivered small molecule compound that is in phase 1 clinical trails for the treatment of irritable bowel syndrome and other gastrointestinal disorders. In addition, it develops three orally-delivered small molecule compounds in preclinical development stage that include LX7101 for treatment of glaucoma; LX5061 for the treatment of osteoporosis; and LX2311 for the treatment of autoimmune diseases. Further, the company has small molecule compounds from various additional drug discovery programs in various stages of preclinical research. It has drug discovery and development collaborations with Bristol-Myers Squibb Company; Genentech, Inc.; N.V. Organon; and Takeda Pharmaceutical Company Limited. The company also has a series of agreements with Symphony Icon, Inc. for the financing of clinical development programs; and an alliance with Nuevolution A/S to access Nuevolution?s Chemetics chemistry technology. Lexicon Pharmaceuticals, Inc. was founded in 1995 and is headquartered in The Woodlands, Texas.

Advisors' Opinion:
  • [By Lauren Pollock]

    Lexicon Pharmaceuticals Inc.(LXRX) said a pilot study of a treatment for ulcerative colitis showed certain clinical benefits, but the results lacked other findings that would indicate a large enough impact to move ahead on developing the treatment for this particular use. Shares dropped.

Top 10 Asian Companies To Buy For 2015: Bfs Entertainment Multimedia Lt (BFS.V)

BFS Entertainment & Multimedia Limited, a home entertainment company, focuses on the acquisition, distribution, and production of film and television media in North America. It produces various programs, including adventure, science, wildlife, history, factual entertainment, and lifestyle, as well as classic dramas, mystery, comedy, sports, documentaries, and health and wellness programs under the BFS Video, American Home Treasures, and Bodhi Lifestyle brands. It also sells DVDs, as well as non-DVD products comprising gifts, jewelry, books, and other collectables. The company sells its products through various channels, including retailers, distributors, and mail order houses, as well as through its mail order catalogue and e-commerce Websites. BFS Entertainment & Multimedia Limited was founded in 1980 and is headquartered in Richmond Hill, Canada.

Top 10 Asian Companies To Buy For 2015: Woolworths Ltd (WOW.AX)

Woolworths Limited engages in retailing business in Australia, New Zealand, and India. It operates 1,033 supermarkets under the Woolworths and Safeway brand names in Australia, and Countdown brand in New Zealand; 11 Thomas Dux supermarkets in Australia; liquor outlets under the BWS and Dan Murphy�s brand names; Woolworths/Safeway attached liquor outlets; and 599 petrol canopies in Australia of which 132 are co-branded with Woolworths/Caltex. The company also operates 172 BIG W general merchandise stores; 294 hotels, which include bars, dining, gaming, accommodation, and venue hire operations; and 21 hardware stores and 15 Masters stores, as well as provides buying, wholesale, supply chain, and general consulting services to 77 stores operating under the Croma brand in India. Woolworths Limited was founded in 1924 and is based in Bella Vista, Australia.

Top 10 Asian Companies To Buy For 2015: Worthington Energy Inc (WGAS)

Worthington Energy, Inc. (Worthington), formerly Paxton Energy, Inc., incorporated July 30, 2004, is an oil and gas exploration and production company with assets in Texas and in the Gulf of Mexico. Worthington�� assets in Texas consist of a minority working interest in limited production and drilling prospects in the Cooke Ranch area of La Salle County, Texas, and Jefferson County, Texas, all operated by Bayshore Exploration L.L.C. (Bayshore). The Company�� assets in the Gulf of Mexico consist of a leasehold working interests in certain oil and gas leases located offshore from Louisiana, upon which no drilling or production has commenced as of December 31, 2011, and a 10.35% interest in the recently drilled I-1 well and a 2% royalty interest in 14,400 acres in the Mustang Island Tract 818. On March 27, 2012, it acquired certain assets from Black Cat Exploration & Production, LLC.

In Texas, the Company has working interests ranging from 4% to 31.75% (net revenue interests ranging from 3% to 23.8125%) in the various wells. In the Gulf of Mexico it has a 70% leasehold working interest, with a net revenue interest of 51.975%, of certain oil and gas leases in the Vermillion 179 tract and 10.35% interest in the recently drilled I-1 well and a 2% royalty interest in 14,400 acres in the Mustang Island Tract 818. As of December 31, 2011, it had one producing well that generated average total monthly net revenue.

The Mustang Island 818-L Field, located in the Kleberg County waters of the Gulf of Mexico, is a field re-habilitation project targeting bypassed or only partially produced gas-condensate. Total production from the wells within the seismic coverage was 125.6 billion cubic feet. In January 2011, the Hercules Offshore 205 jack-up rig was contracted to re-enter the I-Well on the Mustang License Area. The oil and gas leases are located in the VM 179, which is in the shallow waters of the Gulf of Mexico offshore from Louisiana. VM 179 is at 85 inches water depth approximately ! 46 miles offshore Louisiana in the Gulf of Mexico.

Friday, January 24, 2014

FDO: Leave Family Dollar Stock On the Shelf

family dollar 150x150 FDO: Leave Family Dollar Stock On the Shelf   Family Dollar Stores (FDO) recently warned that earnings would decline in fiscal 2014 compared with the prior year as the retail environment remained challenging. This Zacks Rank #5 (Strong Sell) is facing tough market conditions as its core customers who shop for value haven’t seen the benefits of the economic recovery. Family Dollar is a discount retailer operating 8,000 stores in rural and urban locations in 46 states.

Lackluster First Quarter

On Jan 9, Family Dollar reported fiscal first quarter 2014 results which missed the Zacks Consensus Estimate by a penny. Sales rose 3.2% to $2.5 billion from $2.4 billion in the year ago period. This was in line with its previously announced guidance for the quarter.

Consumables led the quarter with an increase of 4.7%, as refrigerated and frozen food, health aids and tobacco boosted the quarter.

Comparable store sales fell 2.8% as customer transactions decreased.

Warned on the Full Year

Family Dollar expects the challenges it faced in the first quarter to impact it the rest of the fiscal year. The economy is not great for its core customer and promotions remain intense.

Comparable store sales for December, which is in the second quarter, fell 3% due to a decline in customer transactions. For the second quarter, comparable store sales are expected to decline in the low-single-digit range.

For the full year, earnings per share are now forecast to be in the range of $3.25 to $3.55 compared with $3.83 it made in fiscal 2013, which also had one more week.

Analysts didn’t waste any time in cutting their estimates. 14 out of 15 estimates were lowered for fiscal 2014 after the announcement. The Zacks Consensus Estimate fell to $3.42 from $3.99. That’s a 10% decrease in earnings compared with fiscal 2013.

Shares Slide

Investors have been fleeing the shares for the last few months.

1390431910 scaled 425 FDO: Leave Family Dollar Stock On the Shelf

Even still, the shares aren’t that cheap. It trades with a forward P/E of 19.8. The discount retailers, as an industry, are in bad shape. They all have customers that are still struggling. The industry ranks in the bottom 4% of Zacks 265 industries.

But if you MUST own one in your portfolio, check out Dollar General (DG). It is a Zacks Rank #3 (Hold) and is expected to see double digit earnings growth this year and next.

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Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Insider Trader and Value Investor services. You can follow her on twitter at @TraceyRyniec.

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Wednesday, January 22, 2014

Goldman Sachs Really Doesn’t Like Potash Stocks

Goldman Sachs does not like potash stocks. Not at all. Especially not Mosaic (MOS), which it downgraded in a report dated yesterday.

Reuters

Goldman’s Adam Samuelson and team explain why investors shouldn’t mistake a “potash floor for a long-term recovery:”

We maintain our Cautious coverage view of Fertilizers, with 5% downside on average to our revised 12-month price targets. Despite recent signs of a price floor emerging, Potash (K) fundamentals remain challenged, in our view, given sustained global over-supply that lead our price forecasts to stay well below 2010-2012 over our forecast period…We downgrade shares of Mosaic to Sell, with 13% downside to our revised 12-month target, as we see an unfavorable risk/reward with shares only 8% below July 2013 levels despite a significantly less favorable K price outlook given our s/d forecasts. We also reiterate our Sell rating on [Intrepid Potash (IPI)], where we continue to see limited FCF generation in 2014- 2016 given our NA K price outlook, even giving [Intrepid Potash] credit for recent cost cutting.

Top Dividend Companies To Watch For 2014

Which of course begs the question: Why didn’t Samuelson cut Potash (POT)? He has an answer:

We downgrade [Mosaic] to Sell but keep [Potash] at Neutral given (1) greater valuation support at POT given its 4.1% dividend yield, which we view as sustainable given our pricing/cash flow forecasts, which we also believe is a key appeal for [Potash's] large Canadian institutional holders, (2) a more favorable cost outlook at  [Potash] following recent headcount reductions, which should help the company improve utilization at lower-cost facilities (e.g., Rocanville), and (3) earnings ballast from a less negative near-term [Neutral] outlook at [Potash]. That said, our revised $32, 12-month price target for  [Potash] still implies 5% downside and our core K industry view is that both companies will be significantly impacted.

Shares of Mosaic have dropped 1.2% to $47.72 at 3:08 p.m., while Intrepid Potash has fallen 1.2% to $16.35 and Potash has declined 1.4% to $33.26.

Tuesday, January 21, 2014

Johnson & Johnson: When 37% Growth is Not Enough

When is a 37% profit increase not enough to make Johnson & Johnson’s (JNJ) stock rise? When the health-care company also predicts full-year earnings that are short of analyst forecasts.

Li junfeng – Imaginechina

The Wall Street Journal has the details on Johnson & Johnson’s earnings announcement:

For the year, the maker of products from Band-Aids to knee-replacement parts forecast per-share earnings of $5.75 to $5.85. Analysts polled by Thomson Reuters had expected a per-share profit of $5.85.

J&J reported a profit of $3.52 billion, or $1.23 a share, up from $2.57 billion, or 91 cents a share, a year earlier. Excluding an increase in its litigation accrual, acquisition-related impacts and other items, adjusted earnings rose to $1.24 from $1.19. Revenue increased 4.5% to $18.36 billion.

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Analysts expected a per-share profit of $1.20 and revenue of $17.95 billion.

Leerink’s Danielle Antalffy and Robert Marcus try to figure out what’s wrong:

It’s possible that 2014 guidance reflects: (1) some level of conservatism — in line with historical guidance — given still seemingly weak though potentially stabilizing MedTech utilization trends; and (2) what we estimate to be as much as $0.03-$0.05 of EPS dilution related to last week’s announcement of a sale of its Diagnostics business…

But in the meantime, we’re inclined to think investors will view 4Q13 results & 2014 EPS guidance positively overall as: 1) Pharma momentum clearly continues; 2) MedTech price and volume trends seem to have largely stabilized though haven’t yet demonstrated meaningful improvement; 3) a Consumer turnaround seems well underway.

S&P Capital IQ’s Herman Saftlas thinks Johnson & Johnson is still worth buying:

Despite a projected hit of $0.11 from a devalued yen, we see results in 2014 benefiting from momentum in drugs, ongoing recovery in consumer products and stronger gains in devices.

Shares of Johnson & Johnson have fallen 1.8% to $93.36 today, helping to contribute to a weaker Dow today. Other big Dow losers include Travelers (TRV), which is off 1.7% at $84.98 and Verizon Communications (VZ), which has dropped 1.6% to $47.56.

Monday, January 20, 2014

5 Dividend Boosters That Could Really Pay Off

BALTIMORE (Stockpickr) -- Who cares about dividends? With the S&P 500 in rally mode this fall, it's easy to ignore the cash payouts that companies are offering up to investors right now. After all, dividends only matter in tough markets, not markets where you can make capital gains hand over fist, right?

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Wrong.

Even in 2013, dividend investing is paying off in a big way. While the S&P 500's year-to-date capital gains have weighed in at a lofty 23.6% as of this writing, the payout-centric S&P 500 Dividend Aristocrats Index has generated total returns of 27.3% over that same period. That's pretty material outperformance.

And that's not all. Over the last three and a half decades, dividend stocks have outperformed the rest of the S&P 500 by 2.5% annually, and they outperformed nonpayers by nearly 8% every year, all while paying out cash to their shareholders, based on data compiled by Ned Davis Research. The numbers are even more compelling when looking at companies that consistently increase their payouts.

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To take advantage of that trend today, we're focusing on dividend stocks that look ready to hike their payouts. So instead of chasing yield, we'll try to step in front of the next round of stock payout hikes.

For our purposes, that "crystal ball" is composed of a few factors: namely a solid balance sheet, a low payout ratio, and a history of dividend hikes. While those items don't guarantee dividend announcements in the next month or three, they do dramatically increase the odds that management will hike their cash payouts.

Without further ado, here's a look at five stocks that could be about to increase their dividend payments in the next quarter.

AT&T

First up is telco giant AT&T (T). To be clear, AT&T's likelihood of a dividend hike doesn't mean that the communications giant is lacking in its payout; the firm has been the highest-yielding Dow Jones Industrial Average component for quite a while now. But nevertheless, the firm looks likely to boost its 5% dividend yield in the near-term.

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AT&T is one of the biggest communications firms in the world, with nearly than 95 million wireless customers, 30 million landline customers and 16 million internet subscribers. That huge installed base gives AT&T some big advantages when it comes to selling bundled services to its existing customer Rolodex, and those in turn help fuel double-digit net margins on AT&T's income statement. Top rival Verizon (VZ) made a big move when it bought the rest of its mobile phone arm, but it overpaid big time in the process. That makes AT&T look like the more attractive telco giant by far right now.

A strong history of rewarding shareholders means that AT&T uses most of its free cash generation for dividends and stock repurchases. From a technical standpoint, this stock is just starting to look attractive again after a downtrend from April to the middle of this month. That fundamental and technical overlap makes now a good time to be a buyer.

AT&T has paid out a 45-cent dividend for the last four straight quarters; a hike is in the cards.

Coca-Cola

A quick glance at Coca-Cola's (KO) chart bears a lot of resemblance with AT&T's. Both blue chip names have been correcting for the last few months, only to bounce higher in the last few weeks. That's not the only similarity between these two stocks, of course; Coke is another name that looks primed for a dividend hike.

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Coca-Cola is the largest beverage company in the world. Coke's products make up an astounding 3% of the 55 billion beverages served worldwide each day, a feat that's accomplished through a distribution network that reaches more than 200 countries. Shifting global consumer trends are providing big growth opportunities for KO, as difficult as that may be to believe given the firms jaw-dropping scale. But as buyers in emerging markets slowly shift their soft drink and bottled water consumption in like with the developed markets, KO expects it'll nearly double its sales by 2020.

From a financial standpoint, Coke is in stellar shape. Despite major bottler acquisitions, the firm has remained nearly debt-neutral, leaving plenty of dry powder to hike its 28-cent-per-share dividend payout. Keep an eye on this name. After four straight quarters, KO looks ready give investors a raise on their 2.8% yield.

Emerson Electric

Industrial firm Emerson Electric (EMR) is another blue-chip name that's gone four straight quarters without showing shareholders a dividend raise, but that could change next week, when the firm reveals its quarterly results to Wall Street. Right now, EMR pays out a 41-cent quarterly dividend that adds up to a 2.45% yield.

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Emerson Electric owns a diverse portfolio of businesses, manufacturing electric motors, valves and switches, air conditioning compressors and tools. Yes, that positioning gives EMR hefty exposure to the cyclical industrial sector, but industrials have really been working in 2013 thanks to a combination of boosted economic activity and interest rates that continue to simmer near zero. One of EMR's biggest growth engines is overseas. Big recent investments in Emerson's power business in recent years should also help drive sales in the lucrative (and less cyclical) infrastructure projects taking place around the globe.

Like the other names on this list, Emerson has consistently prioritized shareholder returns: historically, the firm has paid out around 80% of free cash for dividends and share buybacks. As the firm's fundamentals continue to improve, so too should EMR's payouts.

Automatic Data Processing

Even though jobs growth has been slow for the economy in the last five years, it hasn't slowed down the pace of HR administrator Automatic Data Processing (ADP). ADP provides services such as payroll processing, tax remittances and benefits administration to more than 600,000 businesses that don't want to (or can't) deal with them in-house.

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ADP's bread and butter has long been payroll services, but in recent years this low interest rate environment has been a major challenge to the old way of doing business; since ADP earns interest on the float from payroll cash deposited by clients, higher rates means higher revenues. But the firm has combatted that by focusing on leveraging its huge customer Rolodex to sell add-on services to existing accounts. Those efforts have helped prevent ADP from the worst downside risk on its income statement, and that change means that ADP's earnings power is multiplied when higher rates come back into the picture.

Right now, ADP has a spotless balance sheet, with an immaterial amount of debt offset by $2 billion in cash and investments. ADP's coffers aren't the biggest out there, but they're plenty big to support future dividend hikes. And ADP looks due for one near-term.

The firm's 43.5-cent quarterly dividend adds up to a 2.3% yield – but investors should watch out for a hike next month.

Wynn Resorts

2013 has been a stellar year for casino operator Wynn Resorts (WYNN). The Las Vegas icon has rallied more than 47% since the calendar flipped over to January, giving investors nearly double the S&P 500's performance over that same time period. And while it might be easy to ignore WYNN's 2.4% dividend yield amid that much capital appreciation, it would be a mistake.

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Wynn has some attractive positioning on the luxury end of the casino resort spectrum. And while most American gamblers equate Wynn with the firm's two flagship resorts in Las Vegas, the firm's real cash cow is halfway across the world. Today, around 70% of the firm's revenues actually come from Macau, the high-end Chinese gambling district. Macau is Wynn's crown jewel in large part because the firm is one of the few that's been granted a gaming license from the government. Wynn has two properties in Macau, with a third on the way.

And like the other big names on this list, Wynn has a history of treating shareholders well. That may have something to do with Steve Wynn, the firm's founder and CEO, who own around 9% of WYNN's shares. Previous payouts included a $7.50 special dividend last year that upped the firm's yield to 6.5%. While another special dividend isn't in the cards, I think a hike from the current $1 quarterly dividend looks likely in the next quarter.

To see these stocks in action, check out the Rocket Stocks portfolio at Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.


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Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to

TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Follow Jonas on Twitter @JonasElmerraji


Sunday, January 19, 2014

Ask Matt: Can I get shares of the Twitter IPO?

USA TODAY markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com.

Q: Can I get shares of the Twitter IPO?

A: The IPO gold rush is back on, and this time, investors are hoping for a piece of Twitter.

Twitter, the popular online messaging service, is expected to sell shares to the public for the first time this week. Interest is especially high in this deal since Twitter is a service commonly used by many people who tend to also buy stocks. The initial price range set by the company also was set low, making some investors think the stock could pop on its first day.

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But that changed Monday. The company boosted its expected price range from $17 to $20 a share to $23 to $25. That gives the company a value of between roughly $13 billion and $17 billion, depending on how investors count the company's shares outstanding. Investors expected the company to be worth $15 billion before the IPO.

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With the offering price being moved up, it's now likely that some large institutional investors might take a pass on the shares. And that means more shares will be made available to investors. Traditionally, underwriters might make about 20% of a deal's shares available to regular investors.

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If you're a customer of the investment banks leading the deal, including Goldman Sachs, you can check with your broker to see if you can buy shares. Otherwise, large online brokers like TD Ameritrade and Fidelity might make shares available. Just be careful, though. IPOs are infamously difficult to time and sometimes the easy money doesn't pan out as planned.

Saturday, January 18, 2014

Top 5 Gold Companies For 2014

At any given moment, there are (literally) thousands of analysts poring over hundreds of pages of New Delhi housing starts, Japanese birth rates, and Shanghai's weekly electric consumption figures.

But the real 800 lb gorilla in the room, the single most important demographic in the 21st century continues to fly just below the radar.

I'm talking, of course, about American Women: the healthiest, wealthiest women in human history. If the Golden Rule is "He She who has the gold makes the rules," then the U.S. is a de facto Matriarchy. Women are the primary purchasers of computers, automobiles, banking, financial services and most other big ticket items.

Nevertheless, much of Corporate America is still premised on the male dominated, smoke filled era of AMC's Mad Men, despite the fact that women process information and make purchasing decisions differently from men. Forget the finger pointing and charges of sexism, ignoring women in the 21st Century is a losing financial proposition.

Top 5 Gold Companies For 2014: Golden Star Resources Ltd(GSS)

Golden Star Resources Ltd., a gold mining and exploration company, through its subsidiaries, engages in the acquisition, exploration, development, and production of gold properties. It owns and operates the Bogoso/Prestea gold mining and processing operation that covers approximately 40 kilometers of strike along the southwest-trending Ashanti gold district in western Ghana; and the Wassa open-pit gold mine located to the east of Bogoso/Prestea in southwest Ghana. The company also has an 81% interest in the Prestea underground gold mine located in Ghana. In addition, it holds interests in various gold exploration projects in Ghana, Sierra Leone, Burkina Faso, Niger, and Cote d?Ivoire, as well as holds and manages exploration properties in Brazil in South America. The company was founded in 1984 and is based in Littleton, Colorado.

Advisors' Opinion:
  • [By Rich Duprey]

    Clash of the titans
    When bears are raging on the gold bullion market, it's not surprising to see gold stocks getting mauled as well. Golden Star Resources (NYSEMKT: GSS  ) was the biggest loser in the sector, losing a quarter of its market cap on no company-specific news, though a report last Friday indicated that a large number of hedge funds had recently dumped their positions in the mid-tier miner. Yet it wasn't all that much better among the majors, either, as Barrick Gold (NYSE: ABX  ) fell almost 13% and Kinross Gold (NYSE: KGC  ) was down 14%.

  • [By Patricio Kehoe] ating price of the commodity, along with the geopolitical risks involved in mining in African nations such as Ghana, are just two of the obstacles the firm is facing. In addition, as one of the smallest gold mining firms in the industry, with a market cap of just $122 million, Golden Star has had a very difficult time financing its latest expansion projects. With share prices tumbling towards all-time lows, gurus such as Steven Cohen, Chuck Royce and Arnold Schneider have already sold out their positions in the troubled firm.

    Why Have Gurus Lost Faith in Golden Star?

    Despite aggressive expansion over the past decade, the Toronto-based gold mining firm has not been able to take advantage of its increased production output. Gold prices might have exploded over a ten-year period, yet the recent six-month decline has put a huge strain on Golden Star. The expedited maturation of its mines is particularly troubling, since the accelerated extraction rates, which allowed for short-term profits, are now falling considerably. The impact of the company�� excessive overproduction on profits and growth is clear: decreasing gold reserves mean less production, and thus reduced revenue for the gold miner. When the decline in metal prices are taken into account, the outlook is even more grim.

    In addition to overexpansion at the wrong time, Golden Star�� position has weakened due to its comparably less efficient operations. Unlike industry peers, such as IamGold Corp. (IAG) or Gold Fields Ltd. (GFI), the majority of the Toronto-based miner�� assets contain refractory ore, which is far more expensive to extract than non refractory ore. And, in an attempt to switch production to the lower cost gold ore, and thus increase margins, Golden Star has depleted its mines��non refractory ore. With low reserves and mounting cash costs, the firm inevitably turned to new acquisitions.

    Overpriced Acquisitions and Geopolitical Risk

    The purchase

  • [By Sean Williams]

    Golden Star Resources (NYSEMKT: GSS  )
    It's simple physics: The bigger they are, the harder they fall. When gold prices nosedived earlier this week, gold miners with historically higher operating costs took the brunt of the hit. For the most part, that meant that development-stage miners, and those operating in Africa, where labor and political costs make cost-effective mining a challenge, took it on the chin. Possibly no stock was hammered more than Golden Star Resources, a gold miner in Ghana, which lost about one-quarter of its value on Monday alone.

Top 5 Gold Companies For 2014: First Majestic Silver Corp.(AG)

First Majestic Silver Corp. engages in the production, development, exploration, and acquisition of mineral properties with a focus on silver in Mexico. The company owns interests in La Encantada Silver Mine comprising 4,076 hectares of mining rights and 1,343 hectares of surface land located in Coahuila; La Parrilla Silver Mine consisting of mining concessions covering an area of 69,867 hectares; and San Martin Silver Mine comprising approximately 7,841 hectares of mineral rights and approximately 1,300 hectares of surface land rights located in Jalisco. It also holds interests in Del Toro Silver Mine consisting of 393 contiguous hectares of mining claims and an additional 129 hectares of surface rights located in Zacatecas; Real de Catorce Silver Project comprising 22 mining concessions covering 6,327 hectares located in San Luis Potosi state; and Jalisco Group of Properties consisting of mining claims totalling 5,240 hectares located in Jalisco. The company was founded in 1979 and is headquartered in Vancouver, Canada.

Advisors' Opinion:
  • [By Doug Ehrman]

    Despite the weakness seen in precious metals a few weeks ago, silver has been relatively stable ever since mid-April, with the iShares Silver Trust (NYSEMKT: SLV  ) trading in a dollar-wide range ever since. With the presidents of the Chicago and Philadelphia Federal Reserve banks��releasing conflicting statements, turmoil may be just around the corner. Miners like Pan American (NASDAQ: PAAS  ) and First Majestic (NYSE: AG  ) are still facing operating challenges, while silver streaming darling Silver Wheaton (NYSE: SLW  ) struggles as well.

Top 5 Safest Stocks For 2014: Goldcorp Incorporated(GG)

Goldcorp Inc. engages in the acquisition, exploration, development, and operation of precious metal properties in Canada, the United States, Mexico, and Central and South America. It produces and sells gold, silver, copper, lead, and zinc. The company was founded in 1954 and is headquartered in Vancouver, Canada.

Advisors' Opinion:
  • [By Hebba Investments]

    Therefore the situation is still very bullish for investors in physical gold and the gold ETFs (GLD, CEF, and PHYS). Investors interested in leveraging this situation into higher potential profits may also consider buying gold miners such as Randgold (GOLD), Goldcorp (GG), Yamana Gold (AUY), and any of the other gold miners. Finally, those willing to shoulder much larger risks may consider some of the exploration and micro-cap companies that offer significant profits at a high risk such as Chesapeake Gold (CHPGF.PK), Pretium Resources (PVG), Western Copper (WRN), or any other of the junior exploration companies. Though investors should keep in mind that gold mining companies and explorers do not always rise with a rising gold price - do your research before you invest in the miners.

  • [By Jim Jubak]

    As of 3:00 PM New York time yesterday, shares of Newmont Mining were down 3.65%; Goldcorp (GG) was lower by 2.85%; Yamana Gold (AUY) was off 2.84%; Barrick Gold (ABX) had dropped 3.17%, and Randgold (GOLD) had declined 1.37%. Goldcorp and Yamana Gold are members of my Jubak's Picks portfolio.

  • [By Doug Ehrman]

    Goldcorp (NYSE: GG  ) recently reported quarterly earnings per share of $0.31, falling well short of analysts' consensus estimates of $0.38 and the $0.50 EPS the company earned in same period a year ago. Despite the miss, President and CEO Chuck Jeannes confirmed the company's full-year guidance, focusing on positive results, favorable growth prospects, and controlled costs. Goldcorp has faced the same pressures that have plagued the two top gold producers, Barrick Gold (NYSE: ABX  ) and Newmont Mining (NYSE: NEM  ) ��weakening gold prices and escalating costs. Ultimately, Jeannes believes the 12-year bull market remains intact, which, if true, makes recent weakness in the stock a buying opportunity.�

  • [By Dan Caplinger]

    Finally, look to other markets for guidance. For instance, precious metals bounced off their recent lows, with gold prices climbing $23 per ounce. Key gold-miners are also up sharply, with Barrick Gold (NYSE: ABX  ) rising about 3% and Goldcorp (NYSE: GG  ) up 1.4%. As two of the largest companies in the industry, both Barrick and Goldcorp have the ability to make strategic moves designed to pick up lucrative assets at bargain-basement prices. As weaker junior miners have to consider extraordinary measures to stay afloat, look for Goldcorp and Barrick to take advantage of fire-sale conditions to take their pick of the litter.

Top 5 Gold Companies For 2014: Goldman Sachs Group Inc.(The)

The Goldman Sachs Group, Inc., together with its subsidiaries, provides investment banking, securities, and investment management services to corporations, financial institutions, governments, and high-net-worth individuals worldwide. Its Investment Banking segment offers financial advisory, including advisory assignments with respect to mergers and acquisitions, divestitures, corporate defense, risk management, restructurings, and spin-offs; and underwriting securities, loans and other financial instruments, and derivative transactions. The company?s Institutional Client Services segment provides client execution activities, such as fixed income, currency, and commodities client execution related to making markets in interest rate products, credit products, mortgages, currencies, and commodities; and equities related to making markets in equity products, as well as commissions and fees from executing and clearing institutional client transactions on stock, options, and fu tures exchanges. This segment also engages in the securities services business providing financing, securities lending, and other prime brokerage services to institutional clients, including hedge funds, mutual funds, pension funds, and foundations. Its Investing and Lending segment invests in debt securities, loans, public and private equity securities, real estate, consolidated investment entities, and power generation facilities. This segment also involves in the origination of loans to provide financing to clients. The company?s Investment Management segment provides investment management services and investment products to institutional and individual clients. This segment also offers wealth advisory services, including portfolio management and financial counseling, and brokerage and other transaction services to high-net-worth individuals and families. In addition, it provides global investment research services. The company was founded in 1869 and is headquartered in New York, New York.

Top 5 Gold Companies For 2014: Claude Resources Inc.(CGR)

Claude Resources Inc. engages in the acquisition, exploration, and development of precious metal properties, as well as production and marketing of minerals in Canada. It primarily explores for gold in northern Saskatchewan and northwestern Ontario. The company holds interests in the Seabee gold mine located at Laonil Lake, northern Saskatchewan; and the Madsen property that consists of 6 contiguous claim blocks totaling approximately 10,000 acres, located in the Red Lake Mining District of northwestern Ontario. It also holds interest in the Amisk Gold project, which covers an area of 13,800 hectares in the province of Saskatchewan. The company was founded in 1980 and is based in Saskatoon, Canada.

Friday, January 17, 2014

Asset allocation for 21st century retirement

For most clients, today's version of retirement will likely include part-time work or flexible working arrangements, in addition to income from Social Security and retirement plans (for those who have them).

In general, most clients are financially unprepared to stop working completely. According to the Federal Reserve's Survey of Consumer Finances, only 51.7% of families headed by a person 65 or older has a retirement account. The median value of the retirement account among those surveyed was $80,700.

Not only do the economics of retiring dictate that most of us plan to work even after we qualify for Social Security, but so does the biology and sociology of retiring — people are living longer and healthier lives. Many people continue to enjoy the positive benefits of working even when they've reached the Social Security system's full retirement age.

It may be that employment for some of the “Medicare eligible” becomes an opportunity to explore hobbies that could end up generating income. Earning money from an area of interest, with no concern for health care benefits, can provide a greater sense of well-being and fulfillment. Employees who don't demand health care or retirement benefits are attractive to potential employers as well.

ADDING HUMAN CAPITAL TO THE ASSET ALLOCATION PIE

With these changes as a backdrop, it becomes clear that retirement conversations need to move beyond topics like Social Security's antiquated concept of full retirement age. When we consider the impact of human capital on the asset allocation pie, it is obvious that advisers need to incorporate any earned income stream into retirement planning. Employment-generated income combined with income from Social Security can count towards the fixed-income allocation of a retirement portfolio. By continuing to work in retirement, investors can take on more equity exposure within their financial portfolio.

A common rule of thumb has been that as individuals get older, more of their investments should be allocated to bonds. This rule is derived from adding human capital and financial capital together for a person's total portfolio. A young person's future income stream can be viewed as a type of bond with various options: the bond portion comes from periodic and predictable income while the options come from the ability to switch jobs, change consumption patterns or extend one's work life. Because of this bond-plus-options character of human capital, the person's financial portfolio can be skewed toward equities to keep a balanced total portfolio.

Today's retirees may continue to benefit from these options regarding employment. However, like options, human capital also has something called time decay, meaning the option's value declines rapidly as its expiration date approaches. It may become harder to switch jobs once a person accumulates a certain amount of! experience or seniority. The “golden handcuffs” can make it difficult to switch out of a high-salary-good-benefits job into something lower on the corporate ladder. Hitting retirement, however, can make it easier to rationalize and stomach a dramatic change.

THE CONTINUING VALUE OF HUMAN CAPITAL

Twenty-first century retirement, which includes income generation from some level of employment, requires a new asset allocation model.

Active Management

We suggest an emphasis on actively managed investment strategies, particularly those that are benchmark-free. These also may be referred to as absolute return strategies. The investment manager's goal is to beat inflation by a significant margin over an entire investment cycle. This is also an argument for investing with a fixed-income manager who isn't constrained to hugging a benchmark, kind of a “fixed-income plus option” strategy to better mimic, at least in theory, human capital.

Greater equity holdings

Since people who choose to work in retirement can effectively use their employment income to offset some of what would typically be allocated to fixed-income securities, they can likely afford to hold more equities in their 21st century style retirement than the conventional retirement asset allocation would dictate. The extent to which they can allot more to equity exposure depends on the amount of income they generate from working and the predictability of that income. This requires a standard present-value calculation that every adviser should be familiar with. When you add the present value of Social Security income with the present value of work income, you can get a good estimate of the dollar amount of fixed-income allocation that can be displaced in a retirement plan.

Smaller cash allocation

In last century's version of retirement, a spending account — typically in the form of a money market account — is a needed source of funding for immediate and incipient expenses. For someone with other source! s of inco! me — for example, a job in which a periodic paycheck is the source of immediate and near-term funding — the cash slice of the asset allocation pie can get slimmer. The source of income is the analog to the retiree's spending account. For example, if you can rely on a semi-monthly paycheck, that dollar amount can offset or reduce the amount you need in a spending account. Social Security and work income can fill up the bucket you would typically dip into the financial asset well.

An investor with a job will also likely want some cash holdings to account for any possible job loss, but that should be seen as a type of insurance rather than part of an investment strategy. Thus, retirees who are also working may require a smaller cash allocation than the typical retirement asset allocation would suggest.

The new 21st century retirement, in which people live longer and stay at least partially attached to the labor force, can transform today's view of asset allocation in retirement.

Thursday, January 16, 2014

Amarin Offers American Depositary Shares - Analyst Blog

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Amarin Corporation (AMRN) recently announced its offer to sell 21.7 million American Depositary Shares (ADS). As per the underwriting agreement, the underwriters to the issue were given an option to purchase 3.255 million shares of Amarin to cover over-allotments, if any. The underwriters will be provided a 30-day window to do so.

Amarin has filed a registration statement with the Securities and Exchange Commission (SEC) in relation to its ADS offering. The company plans to file a preliminary prospectus supplement with the SEC shortly.

Amarin was also in the news recently when it announced encouraging results from a phase I trial on its cardiovascular candidate, AMR-102, a fixed-dose combination of the company's only marketed product, Vascepa and AstraZeneca's (AZN) Crestor (rosuvastatin).

We note that apart from AMR-102, the company is also evaluating Vascepa for several indications. The US Food and Drug Administration (FDA) approved Vascepa as an adjunct to diet for reducing triglyceride levels in adults suffering from severe (≥500 mg/dL) hypertriglyceridemia (very high triglycerides) in Jul 2012. The company started marketing the drug in the US from Jan 2013.

The company seeking to get Vascepa approved for other indications including the treatment of adults with high triglyceride levels (≥200 mg/dL and <500 mg/dL), who are receiving statin therapy for elevated LDL-C (low-density lipoprotein cholesterol) levels.

Amarin carries a Zacks Rank #3 (Hold). Pharma stocks, which appear to be favorably placed, include Valeant Pharmaceuticals (VRX) and Targacept Inc. (TRGT). Both the stocks carry a Zacks Rank #1 (Strong Buy).

Wednesday, January 15, 2014

Hot Companies To Watch In Right Now

Memo to the President and Congress: The stock market doesn’t care about your shutdown nonsense. (But it does care about the debt limit, so keep reading.)  

Stocks shrugged off the first full day of the historic 2013 government closure. The Dow Industrials added 0.41%, the S&P 500 gained 0.80%, and the Nasdaq composite jumped 1.23%. The stock market virtually aped its historical performance during the last two government closures in 1995 and 1996.

But one day’s performance doesn’t necessarily make a trend, nor does it mean financial markets will forgivingly tolerate everything the government does.  

During 2011, the debt ceiling brouhaha, something happened that we shouldn’t soon forget. As politicians on both sides of the aisle were bickering, the S&P 500 (SPY) swiftly declined 16.58% from July 22 to Aug. 8.

That provided a clear message: Financial markets don’t like political grandstanding, particularly when it impacts something as meaningful as sovereign debt.

Hot Companies To Watch In Right Now: Sun-Rype Products Com Npv (SRF.TO)

Sun-Rype Products Ltd. engages in the production, marketing, and sale of fruit-based beverages and food products under the SunRype brand in Canada and the United States. The company offers fruit snacks, concentrated and single strength juices, juice blends, and drinks. It also engages in the contract manufacturing of food and beverage products for other companies to distribute under their own brand or private label names; and produces and sells industrial ingredients, including bulk juice and juice concentrates. The company sells its products through grocery stores, club stores, mass merchandisers, smaller wholesalers, and drug stores, as well as retailers. The company was formerly known as BC Fruit Processors Ltd. and changed its name to Sun-Rype Products Ltd. in April 1959. Sun-Rype Products Ltd. was founded in 1946 and is headquartered in Kelowna, Canada.

Hot Companies To Watch In Right Now: Cluff Gold Plc (CFG.TO)

Cluff Gold plc engages in the acquisition, exploration, development, and operation of gold mines and deposits in west Africa. The company�s flagship project is Baomahun Gold Project, a feasibility-stage gold project covering a license area of 136 square kilometers located in the east of the capital Freetown in Sierra Leone. It also holds interest in the Kalsaka project, a producing gold mine comprising 800 square kilometers of property area situated in the Yatenga Province, Burkina Faso; the Yaoure project, a gold project comprising 367 square kilometers of property area located in C么te d�Ivoire; the Mamoudouya Project covering an area of 109 square kilometers situated in western Mali; and Sega project, which covers an area of 313 square kilometers located to the northwest of Ouagadougou. The company was founded in 2003 and is headquartered in London, the United Kingdom.

Hot Undervalued Companies To Watch For 2014: Servotronics Inc.(SVT)

Servotronics, Inc., together with its subsidiaries, engages in the design, manufacture, and marketing of technology and consumer products primarily in the United States. It operates in two segments, Advanced Technology Group (ATG) and Consumer Products Group (CPG). The ATG segment designs, manufactures, and markets various servo-control components that convert an electrical current into a mechanical force or movement, and other related products. Its servo-control components include torque motors, electromagnetic actuators, hydraulic valves, pneumatic valves, and similar devices that are principally sold to commercial aerospace, missile, aircraft, government related, medical, and industrial markets. This segment also produces metallic seals in various cross-sectional configurations that are used to fit between two metal surfaces to produce a secure and leak-proof joint. The ATG segment markets its products primarily through its professional staff to the United States Govern ment, government prime contractors, government subcontractors, commercial manufacturers, and end users. The CPG segment designs, manufactures, and sells various cutlery products, including steak, carving, bread, butcher, and paring knives for household use and for use in restaurants, institutions, and private industry; pocket and other types of knives for use in hunting, fishing, and camping; and machetes, bayonets, and other types of knives for military use. This segment also produces and markets other cutlery items, such as specialty tools, putty knives, linoleum sheet cutters, field knives, and other edged products. The CPG segment markets its products through sales personnel and independent manufacturers? representatives to hardware, supermarket, variety, department, discount, gift, and drug stores, as well as to various branches of the United States Government primarily under the ?Old Hickory? and ?Queen? brand names. Servotronics, Inc. was founded in 1959 and is based in Elma, New York.

Advisors' Opinion:
  • [By Sarah Jones]

    Societe Generale SA, Barclays Plc and Deutsche Bank AG led a selloff in banks, with each falling more than 2 percent. Severn Trent Plc (SVT) sank the most since October 2006 after a consortium of investors dropped their bid for the water utility. Kabel Deutschland Holding AG jumped 8.2 percent after Vodafone Group Plc confirmed it approached the company about a takeover.

Hot Companies To Watch In Right Now: Pixelworks Inc.(PXLW)

Pixelworks, Inc., together with its subsidiaries, engages in the design, development, and marketing of video and pixel processing semiconductors and software for digital video applications. Its products include ImageProcessor integrated circuits (ICs), which comprise embedded microprocessors, digital signal processing technology, and software that control the operations and signal processing within high-end display systems, such as projectors and high-resolution flat panels; Video Co-Processor ICs that work in conjunction with an image processor to post-process video signals to enhance the performance or feature set of the overall video solution; and Networked Display ICs, which allow the same video stream to be networked across multiple displays. The company serves the manufacturers of digital display and projection devices, such as liquid crystal display (LCD) large-screen televisions and 3LCD, and digital light processing digital front projectors, as well as the flat pa nel display market, including digital signage. Pixelworks, Inc. sells its products through its direct sales force, distributors, and manufacturers? representatives in Japan, Taiwan, China, Korea, the United States, Europe, and southeast Asia. The company was founded in 1997 and is based in San Jose, California.

Advisors' Opinion:
  • [By Roberto Pedone]

    A semiconductor stock that looks poised for higher prices is Pixelworks (PXLW), which designs, develops and markets video and pixel processing semiconductors and software for high-end digital video applications. This stock has been in play with the bulls so far in 2013, with shares up by 104%.

    If you take a look at the chart for Pixelworks, you'll notice that this stock has been uptrending for the last month and change, with shares moving higher from its low of $3.63 to its intraday high of $4.74 a share. During that uptrend, shares of PXLW have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now started to push shares of PXLW into breakout territory above $4.58 a share with strong upside volume flows. Volume so far today has already surpassed 1 million shares, which is well above its three-month average action of 334,348 shares.

    Market players should now look for long-biased trades in PXLW if it manages to break out above Thursday's intraday high of $4.74 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 334,348 shares. If we get that move soon, then PXLW will set up to re-test or possibly take out its 52-week high at $5.30 a share. Any high-volume move above $5.30 will then give PXLW a chance to tag $6 a share.

    Traders can look to buy PXLW off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $3.92 a share, or below some more support at $3.80 a share. One can also buy PXLW off strength once it clears $4.74 a share with volume and then simply use a stop that sits a comfortable percentage from your entry point.

  • [By Jon C. Ogg]

    Pixelworks Inc. (NASDAQ: PXLW) showed that its second-quarter revenue rose by 15.5% due to increased sales of chips for both projectors and TVs. Shares were up 26% at $4.50 in the Tuesday after-hours session, but we would warn that volume is not as active and a wide spread may have amped the gain. Now we have shares up a whopping 44% at $5.15, and volume has become active as a result.

Hot Companies To Watch In Right Now: Aurium Resources Ltd(AGU.AX)

Aurium Resources Limited operates as a mineral exploration company in Australia. It focuses on iron ore deposits. The company has a joint venture agreement to explore for iron ore in the Robinson Range area of the Padbury-Bryah Basin in Western Australia. It also explores for uranium deposits in Australia. Aurium Resources Limited was incorporated in 2007 and is based in West Perth, Australia.

Hot Companies To Watch In Right Now: Ruth's Hospitality Group Inc.(RUTH)

Ruth?s Hospitality Group, Inc., together with its subsidiaries, operates restaurants in the United States and internationally. It operates the Ruth?s Chris Steak House, Mitchell?s Fish Market, Columbus Fish Market, Mitchell?s Steakhouse, and Cameron?s Steakhouse restaurant concepts in the full-service dining industry. The company?s restaurants cater to families, special occasion diners, and business clientele. As of December 27, 2009, it owned or operated 152 restaurants, including 64 company-owned Ruth?s Chris Steak House Company restaurants, 66 Ruth?s Chris Steak House franchise restaurants, 19 company-owned Mitchell?s Fish Markets, and 3 company-owned Mitchell?s Steakhouse restaurants. The company was formerly known as Ruth?s Chris Steak House, Inc. and changed its name to Ruth?s Hospitality Group, Inc. in February 2008. Ruth?s Hospitality Group, Inc. was founded in 1965 and is headquartered in Heathrow, Florida.

Advisors' Opinion:
  • [By Seth Jayson]

    When judging a company's prospects, how quickly it turns cash outflows into cash inflows can be just as important as how much profit it's booking in the accounting fantasy world we call "earnings." This is one of the first metrics I check when I'm hunting for the market's best stocks. Today, we'll see how it applies to Ruth's Hospitality Group (Nasdaq: RUTH  ) .

Saturday, January 11, 2014

NVR Whiffs on Earnings

NVR (NYSE: NVR  ) reported earnings on July 22. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended June 30 (Q2), NVR met expectations on revenues and whiffed on earnings per share.

Compared to the prior-year quarter, revenue increased significantly. GAAP earnings per share expanded.

Gross margins contracted, operating margins expanded, net margins shrank.

Revenue details
NVR recorded revenue of $1.01 billion. The seven analysts polled by S&P Capital IQ predicted sales of $1.02 billion on the same basis. GAAP reported sales were 31% higher than the prior-year quarter's $771.1 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $10.11. The eight earnings estimates compiled by S&P Capital IQ averaged $12.14 per share. GAAP EPS of $10.11 for Q2 were 13% higher than the prior-year quarter's $8.97 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 16.6%, 130 basis points worse than the prior-year quarter. Operating margin was 8.4%, 10 basis points better than the prior-year quarter. Net margin was 5.0%, 110 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $1.09 billion. On the bottom line, the average EPS estimate is $14.80.

Next year's average estimate for revenue is $4.08 billion. The average EPS estimate is $50.54.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 250 members out of 518 rating the stock outperform, and 268 members rating it underperform. Among 161 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 83 give NVR a green thumbs-up, and 78 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on NVR is hold, with an average price target of $959.43.

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