Hot Stocks To Buy For 2018: December 2013

Sunday, December 29, 2013

5 Best China Stocks To Buy For 2014

QUALCOMM, Inc. (NASDAQ:QCOM) stands out as one of the few green stocks today. The NASDAQ 100 member was upgraded by Citi. Analyst Ehud Gelblum believes the QCOM is a "Buy" today, up from yesterday's "Neutral," and put a fresh price target of $88 on QCOM as the company begins its relationship with China Mobile.

QUALCOMM Incorporated designs, develops, manufactures, and markets digital telecommunications products and services ��essentially, they make chips so that your wireless devices work faster.

Gelblum tells clients, "We believe the complexity of LTE is accelerating with new major technologies being added to the standard continuously ��from carrier aggregation and envelope tracking last year to TDD and FDD, WiFi integration, small cells and LTE in unlicensed bands in 2014 ��allowing QCOM's outsized R&D budget and 2-yr head start in LTE to put even more distance between itself and competitors."

5 Best China Stocks To Buy For 2014: ChinaCast Education Corporation(CAST)

ChinaCast Education Corporation, together with its subsidiaries, provides post-secondary education and e-learning services in China. The company operates in two segments, E-learning and Training Service Group and Traditional University Group. The E-learning and Training Service Group provides post secondary education distance learning services that enable universities and other higher learning institutions to provide nationwide real-time distance learning services. It also provides K-12 educational services, such as broadcast multimedia educational content services to primary, middle, and high schools; and vocational/career training services. The Traditional University Group segment operates private residential universities that offer four-year bachelor?s degree and three-year diploma programs in finance, economics, trade, tourism, advertising, IT, music, foreign languages, tourism, hospitality, computer engineering, law, and art. The company also provides logistic service s. ChinaCast Education Corporation was founded in 1999 and is headquartered in Central, Hong Kong.

5 Best China Stocks To Buy For 2014: China Kanghui Holdings(KH)

China Kanghui Holdings develops, manufactures, and markets orthopedic implants and associated instruments. It offers approximately 30 product series of orthopedic implants and associated instruments for trauma, spine, cranial maxillofacial, and craniocerebral indications. The company?s trauma products include a range of nails, plates and screws, and cranial maxillofacial plate and screw systems used in the surgical treatment of bone fractures. Its spine products comprise screws, meshes, interbody cages, and fixation systems used in the surgical treatment of spine disorders. China Kanghui Holdings also manufactures products, including implants, implant components, and instruments for original equipment manufacturers. The company markets its products under Kanghui and Libeier brand names through third-party distributors to hospitals and surgeons. It sells its products in Asia, Europe, South America, and Africa. The company was founded in 1996 and is headquartered in Changzho u, the People?s Republic of China.

Top 5 Insurance Companies To Watch For 2014: CNinsure Inc.(CISG)

CNinsure Inc., together with its subsidiaries, provides insurance brokerage and agency services, and insurance claims adjusting services in the People?s Republic of China. The company offers property, casualty, and life insurance products underwritten by domestic and foreign insurance companies operating in China. Its property and casualty insurance products include automobile, individual accident, commercial property, homeowner, cargo, hull, liability, and construction insurance; and life insurance products comprise individual whole life insurance, term life insurance, education annuity, and health insurance, as well as universal insurance and group life insurance. The company also offers insurance claims adjusting services, which include pre-underwriting survey, claims adjusting, disposal of residual value, loading and unloading supervision, and consulting services, as well as damage assessment, survey, authentication, and loss estimation to insurance companies and the i nsured; and value-added services to its customers in conjunction with distributing automobile insurance products. As of April 15, 2010, its distribution and service network consisted of 49 insurance agencies, 3 insurance brokerages, and 4 claims adjusting firms, with 571 sales and service outlets. The company was founded in 1998 and is headquartered in Guangzhou, the People?s Republic of China.

Advisors' Opinion:

[By John Udovich]
China is set to ease the one child policy, something that could benefit Chinese stocks in general but be especially beneficial to insurance stocks like China Life Insurance Company Ltd (NYSE: LFC) and CNinsure Inc (NASDAQ: CISG) plus health care stocks like Mindray Medical International Ltd�(NYSE: MR) and Concord Medical Services Hldg Ltd (NYSE: CCM). First, let�� be clear that China is NOT abolishing the one child policy as the changes will merely�allow married couples to have two children if one spouse is an only child plus it will be up to China�� 34 province-level administrations to revise�their laws and put the new policy into effect. Moreover, China�� family-planning bureaucracy employs more than 500,000 full-time workers and six million part-time workers all the way down to the village level to�collect billions of dollars in fines and these bureaucrats have fought for years against policy changes��meaning they could throw up roadblocks if not placated. With that said, the insurance and health care sectors are two sectors with publicly Chinese stocks that look set to�take advantage of the coming changes.

5 Best China Stocks To Buy For 2014: Arotech Corporation(ARTX)

Arotech Corporation, together with its subsidiaries, provides defense and security products. It operates in three divisions: Training and Simulation, Battery and Power Systems, and Armor. The Training and Simulation division develops, manufactures, and markets multimedia and interactive digital solutions for use-of-force training and driving training of military, law enforcement, security, and other personnel; provides simulators, systems engineering, and software products to the United States military, government, and private industry; and offers specialized use of force training for police, security personnel, and the military. The Battery and Power Systems division manufactures and sells lithium and zinc-air batteries for defense and security products and other military applications; and develops and sells rechargeable and primary lithium batteries and smart chargers to the military and to private defense industry. This division also develops, manufactures, and markets primary zinc-air batteries, rechargeable batteries, and battery chargers for the military; and produces water-activated lifejacket lights for commercial aviation and marine applications. The Armor Division manufactures military and paramilitary armored vehicles, and employs sophisticated lightweight materials to produce aviation armor; and uses engineering concepts to produce combat armored military vehicles and up-armor civilian commercial vehicles. This division also uses lightweight armoring materials and advanced engineering processes to provide ballistic armor kits for rotary and fixed wing aircraft. Arotech sells its products primarily in the United States, Israel, Taiwan, Canada, England, Germany, Australia, China, Hong Kong, Mexico, India, Spain, Singapore, and Japan. The company was formerly known as Electric Fuel Corporation and changed its name to Arotech Corporation in September 2003. Arotech Corporation was founded in 1990 and is based in Ann Arbor, Michigan.

Advisors' Opinion:

[By Roberto Pedone]
One under-$10 stock that's quickly moving within range of triggering a major breakout trade is Arotech (ARTX), which is a defense and security products and services company, engaged in two business areas: interactive simulation for military, law enforcement and commercial markets; and batteries and charging systems for the military. This stock has been on fire so far in 2013, with shares up big by 98%.

If you take a look at the chart for Arotech, you'll notice that this stock is spiking sharply higher today right above its 50-day moving average of $1.84 a share with above-average volume. Volume so far in Thursday has registered over 430,000 shares, which is well above its three-month average action of 302,874 shares. This spike is quickly pushing shares of ARTX within range of triggering a major breakout trade.

Traders should now look for long-biased trades in ARTX if it manages to break out above some key overhead resistance levels at $2.35 to its 52-week high at $2.71 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 302,874 shares. If that breakout hits soon, then ARTX will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $4 to $5 a share.

Traders can look to buy ARTX off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average at $1.84 a share, or below more support at $1.63 a share. One can also buy ARTX off strength once it clears those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

5 Best China Stocks To Buy For 2014: DAQQ New Energy Corp.(DQ)

Daqo New Energy Corp., together with its subsidiaries, manufactures and sells polysilicon in China. The company sells its polysilicon to photovoltaic product manufacturers for use in the processing of ingots, wafers, cells and modules for solar power solutions. It also produces and sells mono-crystalline and multi-crystalline modules to photovoltaic system integrators and distributors in China and internationally under its Daqo brand. The company was formerly known as Mega Stand International Limited and changed its name to Daqo New Energy Corp. in August 2009. Daqo New Energy Corp. was founded in 2006 and is headquartered Wanzhou, the People?s Republic of China.

Saturday, December 28, 2013

Accenture Plc (ACN): Is Cloud Friend Or Foe For Accenture

Deep industry expertise is critical today to survive in any business, especially in the IT services sector. This is a considerable advantage for Accenture Plc (NYSE: ACN), which is investing heavily in cloud and digital. Services is a good place to be in the IT-as-a-Service era and Accenture emphasizes on business services and end-to-end outsourcing.

Services companies are better positioned than hardware companies and even advantaged relative to some software-as-a-service (SaaS) providers in the IT-as-a-service sector because the future is in integration and customization work requiring vertical depth and expertise.

Accenture's consulting services represent nearly 60 percent of its revenue, providing a wide-array of offerings that include management consulting and technology consulting. The company's outsourcing services constitute more than 40 percent of revenue, consisting of technology services outsourcing (ITO) and business process outsourcing (BPO).

"Accenture's investment is around cloud and digital—the company made a good case for Accenture Interactive and its advantages in both front- and back-end capabilities and superior resources," UBS analyst Steven Milunovich wrote in a note to clients.

Investors are skeptical whether the investment in cloud might backfire for Accenture. Accenture is active in helping clients implement new approaches like SaaS and Big Data. In fact, cloud and mobility are each $1 billion businesses already.

Less upfront software-as-a-service (SaaS) implementation revenue is offset by large transformation deals, and the objectivity makes Accenture an attractive cloud broker.

"Our CIO Surveys so far find that cloud should not be negative for IT services providers. In our recent survey out Monday, we specifically asked about the ERP to SaaS shift impact on Accenture with the answer being it is neutral (20% each said would do more and less with the company, 60% said no change)," Milunovich said.

Executives made the case that the 25! -35 percent efficiency of SaaS over ERP in the initial implementation has narrowed to 15-25 percent and that there is additional transformational work around cloud required. Moreover, engineered systems such as Exadata need significant set-up and integration work.

Accenture was explicit in calling out $1.5 billion of cloud revenue—which includes more than SaaS, such as the Accenture Cloud Platform—and 3,500 people working on SaaS implementations. However, it would not enumerate its resources dedicated to more legacy apps.

The Accenture Cloud Platform is a mix of software and services, including a procurement portal that can be deployed internally or hosted in the cloud itself.

Enterprise Resource Planning (ERP) could be the bulk of Accenture's systems integration work for many years, and the trick is managing the transition to new SMAC (Social, Mobile, Data Analytics and Cloud) technologies.

The catch here is that Accenture can't take its eye off the legacy ball and turn off traditional business too fast as they likely will be the majority of revenue in five years.

The opportunity is greater demand for complex solutions to transformation problems. Accenture is one of the few players with both technology and industry expertise focused on solutions rather than point products and able to deliver successful outcomes.

As enterprises move to the cloud, the question is whether it will be public, private, or hybrid. Accenture sees the private cloud (on-premise) as the winner for now. Daugherty confirmed Accenture's view that 20 percent of workloads should make it to public cloud by 2020, similar to estimate that 13 percent of IT spending will go to public cloud by 2016.

Investors are concerned that services vendors may lose substantial legacy revenues, such as ERP and SCM integration. However, Accenture says traditional systems integration and application outsourcing will be its meat and potatoes for years to come.

Also, it has become the largest Salesforce.co! m integra! tor and supports Workday, NetSuite, and other SaaS players. In addition, clients increasingly are looking to do broader process transformations. This trend should bode well for Accenture and its services.

Thursday, December 26, 2013

5 Money Moves To Make In September

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September is a month that marks many endings and many beginnings. Summer ends as the warm weather starts to fade away. Kids are heading back to school to meet new teachers and prepare for a new year. From a financial perspective, September is also a great time for a quick reboot of your financial mind-set.

Here's are some financial moves you should consider this month:

1. Check your free credit report.

You get a free credit report from each of the three major credit bureaus -- Equifax, Experian and TransUnion. While you can check all three credit report at once, it is usually a better idea to pull them four months apart. If you decided to do just that, by pulling one in January and one in May, then you should be pulling your last free credit report of the year in September.

2. Review your television needs and cut the bill.

Before the fall TV season kicks off, take a look at some of the shows that are a must-watch while noting the ones that have ended. Why pay for channels that you won't be watching? With the advent of services such as Hulu and Netflix, you might find that the monthly cost of cable TV is not worth it. (You might even use this as leverage to negotiate a lower cable bill.)

3. Take advantage of the ending life cycle of consumer goods.

The end of summer is the point in the year when companies are looking to clear out this year's items before ramping up production for next year's inventory. Rebates, discounts and other incentives may be in store for major purchases such as cars and appliances. If you don't mind using an older model of a consumer good, then look out for the opportunities to buy some things on cheap.

4. Quarterly taxes are due.

If you are self-employed, a freelancer or a small-business owner, remember that your estimated quarterly tax payments are due. The deadline is Sept. 16 -- many of you should have marked it on the calendar!

5. Holidays are expensive, so start saving.

Halloween, Thanksgiving and Christmas are just around the corner. Whether its travel or gifts, you're likely to be spending money for these occasions. Start thinking about any holiday plans and how much you expect them to cost. Getting your costume, booking flights and buying presents are some of the major tasks that you need to start thinking about to avoid the holiday rush. (And, don't forget about the shopping frenzy of Black Friday.)

Wednesday, December 25, 2013

The 10 Most Popular Stocks Owned By Congress

The truth will make you sick. Technically it's public knowledge, but I can tell you -- it's Congress' dirty little secret.

Congress is rich. Unbelievably rich. And until just recently, insider trading laws didn't apply to Congress.

I don't know which is worse: The fact that insider trading was legal for some of our nation's wealthiest politicians... or that Congress refused to do anything about it for decades.

"A few lawmakers proposed a bill that would prevent members and employees of Congress from trading securities based on nonpublic information they obtain. The legislation has languished since 2006," according to The Wall Street Journal.

That was, the legislation languished until "60 Minutes" -- one of the most respected investigative journalism programs on television -- dedicated a segment to the issue. Here's a portion of what they had to say...

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"In mid-September 2008, with the Dow Jones Industrial Average still above 10,000, Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben Bernanke were holding closed-door briefings with congressional leaders and privately warning them that a global financial meltdown could occur within a few days. One of those attending was Alabama Rep. Spencer Bachus, then the ranking Republican member on the House Financial Services Committee and now its chairman.

"While Congressman Bachus was publicly trying to keep the economy from cratering, he was privately betting that it would, buying option funds that would go up in value if the market went down. He would make a variety of trades and profited at a time when most Americans were losing their shirts."

And that was just one example. Also dug up by "60 Minutes":

House Minority Leader Nancy Pelosi, D-Calif., and her husband have participated in multiple exclusive IPOs -- including that of Visa (NYSE: V). According to one report, Pelosi purchased 5,000 shares of Visa at the IPO price of $44. Just a couple of days later, when the stock was trading to the investing public, it traded at $64 per share.

House Majority Leader John Boehner, R-Ohio, bought stocks in health care companies days before the so-called public option was pulled from the legislation. The removal of the public option proved to be a boon for private health insurers, making a significant sum for Boehner's investments.

The report fr! om "60 Minutes" led to a frenzy. And a few months after the story aired, the STOCK Act, which curbed insider trading by Congress, was signed into law.

But why was it delayed for so long?

Apparently Congress was making too much money off the lax rules to do anything about it.

According to data from the Center for Responsive Politics, 249 of the 535 members of Congress are millionaires. That's 47%. For comparison, about 5% of American households are worth more than $1 million.

So much for representation "by the people." And why on earth would Congress change rules that have obviously helped its members for decades?

Thankfully, the STOCK Act strengthened financial reporting requirements for members of Congress (along with some of their higher-paid aides). Not only did it eliminate insider trading, but Congress must now disclose their trades within 45 days after they happen.

That means we have an opportunity to see exactly what our "representatives" are buying. And we need to know...

In a study cited by Barron's, members of the House of Representatives beat investors like you and me by 55 basis points a month. That comes out to an extra 6.8% per year. I think Barron's said it best...

"To give an indication of what House members' outperformance is worth, investing at the stock market's long-term total return of 10% would mean $10,000 would grow to $25,937 in 10 years. But with their special investment acumen, their 16.8% annual returns would leave them with $47,253 in 10 years."

With that in mind, I decided to dive in and see just exactly what the most popular investments are with Congress...

The 10 Most Popular Stocks In Congress
I'll be honest -- the most popular stocks held by Congress aren't some super-secret investments. They aren't exclusive investments owned only by those in Congress with some inside knowledge of a future breakthrough.

Instead, they're large multinational corporations that make up the bulk of many average investors' portfolios.

I won't keep you in suspense...

1. General Electric (NYSE: GE) -- 83 members

2. Proctor & Gamble (NYSE: PG) -- 68 members

3. Microsoft (Nasdaq: MSFT) -- 64 members

3. Bank of America (NYSE: BOA) -- 64 members

5. Exxon Mobil (NYSE: XOM) -- 56 members

6. JPMorgan Chase (NYSE: JPM) -- 53 members

7. Cisco Systems (Nasdaq: CSCO) -- 52 members

7. AT&T (NYSE: T) -- 52 members

9. Intel (Nasdaq: INTC) -- 51 members

9. Pfizer (NYSE: PFE) -- 51 members

This data is provided by the Center for Responsive Politics. The most recent year available was 2011, before the STOCK Act passed.

As I said, Barron's cited a study that suggests members of Congress post returns much better than average investors.

If their most popular holdings are similar to what many investors own, how is it that members of Congress can earn such higher returns?

No one can say for sure, but my research is turning up a few clues.

If you check out the 10 most popular stocks owned by members of Congress five years ago, eight of them are on the list today. And the two not on the list are in the top 25 today. So is it that members of Congress are just holding on to stocks longer?

That's what I think, but let me explain why...

In 1940, the average holding period for an investment was seven years, according to William Hutchings of the Financial News. By 2007, that period had shrunk to just five days.

But you don't have to trade every day... or every week... or even every year to beat the market. In fact, your success actually in! creases the fewer trades you make and the longer you hold.

A recent study by mega-investment firm Oppenheimer showed that the S&P 500 index has NEVER suffered a loss in a 20-year period (measured in rolling monthly periods), dating all the way back to 1950.

Of course, we all know you can't say the same for holding stocks for a year or two. When you hold stocks for a short period of time, your odds of losing money are much, much higher.

And you can lose a boatload of money in a hurry...

In fact, in its worst one-year period, the S&P 500 dropped 44.8%. No wonder Warren Buffett has always said his favorite holding period is "forever."

I think these shorter holding periods for average investors are hurting their returns.

So yes, it appears members of Congress are buying many of the same well-known stocks as everyday investors, who are now holding for shorter periods than ever and hurting returns.

It was with this thought in mind a few months ago that prompted me to have StreetAuthority's research team update our report on "Forever Stocks." These stocks are ones you can buy and hold practically "forever" and watch the profits roll in. Since first releasing this report, these 10 stocks have returned on average 40% in just a few short years.

If you're a longtime StreetAuthority reader, you've likely heard us talk about some of these stocks before. In fact, a few of the names (like Cisco and Intel) are widely owned by members of Congress and are featured in the list above.

But what you might be surprised to know is that some of our "Forever Stocks" are ones that few people are aware even exist. If you're interested in finding out more about my list of "Forever Stocks" and how you can spot other stocks that should be added to the list, I invite you to check out this short presentation.

Tuesday, December 24, 2013

Jim Rogers to BBC - Tapering Will Lead to Disaster

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Monday, December 23, 2013

Intel's Massive Profits Just Aren't Enough

The following video is from Thursday's Investor Beat, in which host Chris Hill, and analysts Bill Barker and Charly Travers, dissect the hardest-hitting investing stories of the day.

Despite Intel posting a second-quarter profit of $2 billion, the stock took a hit today after the company lowered its full-year guidance. In our lead story today, Bill and Charly discuss how Intel missed its chance at the first-mover advantage in mobile, and whether the stock looks like a buy today.

Also, our analysts look at four stocks that made big moves on Thursday's market. Higher than expected second-quarter profits drove shares of UnitedHealth to a new all-time high. Also, eBay's earnings were in line with expectations, but the outlook for the rest of the year was disappointing, and shares took a hit. Overstock.com's second-quarter profits came in seven times higher than what they were in this quarter last year. And Nokia's 2nd-quarter sales fell 24%, but analysts were expecting even worse.

Finally, Bill and Charly each pick one stock for investors that they'll be watching closely in the week ahead.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.

Friday, December 20, 2013

Updating the Bypass Trust

Is the bypass trust dead? Many people believed when the lifetime estate tax exemption rose to $5 million per person (indexed for inflation), the role of bypass trusts in most estates ended. Far from it. Under the current tax law the bypass trust can be turned from a powerful estate tax saver into a tool for optimizing income tax planning and meeting nontax goals.

Let’s first review how the bypass trust traditionally was used in estate plans and still can be used when the estate is valuable enough to be taxable.

The bypass trust (also called a credit shelter trust or A/B trust) was essential for married couples when the estate tax exemption was lower and most estates were at risk of incurring taxes. The will would direct to the bypass trust an amount of wealth equal to the estate tax exemption, and in the standard will the rest of the estate was given directly to the surviving spouse. The bypass trust stated that the surviving spouse would receive all the income from the trust each year and also could receive any principal necessary to maintain his or her standard of living. After the surviving spouse passed away, the children of the couple became beneficiaries of the trust.

The effect of this strategy was to avoid taxes on an amount of the estate of the first spouse to pass away equal to the estate tax exemption, so it passed to the children without being reduced by any estate taxes. Yet, the surviving spouse was provided for with the assets in the trust, though the value of the trust wasn’t included in the surviving spouse’s estate. The surviving spouse also could pass on an equal amount estate tax free using his or her own lifetime exemption.

With the exemption at $5.25 million per person for 2013 and $5,340,000 for 2014, only a few families need a bypass trust to help shield their estates from taxes. Families with estates below the exempt amount still should consider using a bypass trust to meet other non-estate tax goals and adapt the trust terms for today’s circumstances.

The primary goal of a bypass trust now probably should be to minimize the family’s income tax burden over the years. Start by giving the trustee more discretion regarding distributions from the trust and by naming the spouse and children and perhaps grandchildren as current beneficiaries instead of only the spouse.

Also, give the trustee more discretion regarding the investment strategy. Typical trust terms these days require the trustee to use modern portfolio theory or some similar form of diversification. The problem with this language is that under today’s tax code the location of assets matters considerably. It can mean the difference between paying ordinary income tax rates, long-term capital gains rates, or no tax.

Trusts reach the highest tax bracket and have surtaxes, such as the 3.8% net investment income tax, imposed at very low income levels. In addition, when assets are put in a trust they retain the tax basis the original owner had, and when distributed from the trust retain the tax basis the trust had. But assets held by the surviving spouse have their bases increased to current market value when they are bequeathed to the next owners, such as the children.

The trustee can take advantage of current income tax planning strategies and minimize income taxes on the family when given broader discretion regarding investments and distributions than is traditionally allowed.

The trustee can be allowed to consider family-wide asset allocation instead of only the trust’s investment portfolio when making investment and distribution decisions. The trustee also can be empowered to consider family-wide and long-term tax considerations as well.

For example, instead of distributing primarily investment income to the surviving spouse, the trust can distribute assets that have appreciated significantly. Removing them from the trust makes it possible for the surviving spouse to hold them for life and allow the heirs to increase the tax basis to their fair market value at the surviving spouse’s death. The heirs then can sell them and pay no capital gains taxes on all the appreciation.

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You might want to put limits on this discretion, because when assets leave the trust there is the potential that they won’t find their way to the children. They might be redirected to charity or the family of a subsequent marriage. So, the trust agreement might give the trustee discretion to distribute to the surviving spouse only assets that have appreciated by, say, 20% or more or put a dollar limit on such distributions.

When the trustee has discretion to take income taxes into account in both portfolio decisions and distributions, he or she might be able to increase family after-tax wealth and income by avoiding the top tax bracket and the 3.8% investment income tax on trust income.

You also should reconsider the powers of appointment clause of the trust. This clause allows a person, usually the surviving spouse, to decide who among the other named beneficiaries, usually the children and perhaps the grandchildren, will benefit from the remaining trust assets. The clause also might allow the spouse to decide if assets should be distributed outright to beneficiaries or retained in the trust for a period of time.

In the past, there was a bias to using a limited power of appointment. That kept trust assets from being included in the estate of the surviving spouse. But, because of the step-up in basis allowed beneficiaries who inherit and the high estate tax exemption, it might be beneficial to give the surviving spouse a general power of appointment over assets that have appreciated significantly. That puts the assets in the surviving spouse’s estate. That, in turn, allows the heirs to increase their basis in the inherited assets to current fair market value and avoid capital gains taxes when they sell the assets.

A final consideration is state taxes. These are a greater component of the overall tax bill than in the past, and in many states are likely to rise further. You might want to give the trustee or some other person the power to relocate the trust’s state of residence, particularly if the surviving spouse moves to a low income tax state but the trust was set up in a higher income tax state. A move would save money and be convenient.

A bypass trust also will continue to provide its traditional benefits. The surviving spouse has support and the remaining assets eventually go to your intended final beneficiaries. It also can provide professional management, creditor protection, and family-wide financial planning. With the recommended modifications, the bypass trust also helps reduce income taxes.

Bypass trusts should remain key elements of many estate plans. Their estate tax reduction benefits are necessary for fewer people, but they provide other valuable benefits when adapted for current law.

Thursday, December 19, 2013

Hot Medical Companies To Watch In Right Now

Small cap robotics stocks Adept Technology Inc (NASDAQ: ADEP) and iRobot Corporation (NASDAQ: IRBT) have both been putting in a great performance for investors, but which is the better robotics stock for�investors? I should mention that we have had Adept Technology in our SmallCap Network Elite Opportunity (SCN EO) portfolio since mid-September and we are already sitting on a 71.38% return so far plus we have just added iRobot Corporation to our portfolio because we see the�robotics subsector improving as companies aim to reduce overhead and improve efficiencies through machine to machine (M2M) automation.

What Are Adept Technology and iRobot Corporation?

Small cap iRobot Corporation was founded in 1990 by Massachusetts Institute of Technology roboticists with the�vision to make practical robots a reality by developing and manufacturing robotic solutions to address real-world problems. iRobot Corporation says its home robots are revolutionizing the way people clean with more than 8 million home robots having been sold worldwide ��including the award-winning iRobot Roomba floor vacuuming robot. In addition, more than 5,000 iRobot Corporation robots have been delivered to military and civil defense forces worldwide to perform dangerous search, reconnaissance and bomb-disposal missions while the state-of-the-art Ava mobile robotics platform includes the Ava��500 video collaboration robot which delivers autonomous telepresence to the enterprise market and the FDA-approved RP-VITA telemedicine robot which expands the reach of medical care by connecting physicians with patients from anywhere in the world.

Hot Medical Companies To Watch In Right Now: Fuse Science Inc (DROP.PK)

Fuse Science, Inc. ( Fuse Science), incorporated on September 21, 1988, is a consumer products holding company. The Company maintains the rights to sublingual and transdermal delivery systems for bioactive agents that can effectively encapsulate and charge many varying molecules in order to produce complete product formulations which can be consumed orally, applied topically or delivered otherwise sublingually or transdermally, thereby bypassing the gastrointestinal tract and entering the blood stream directly. The Fuse Science technology is designed to accelerate conveyance of medicines or nutrients relative to traditional pills and liquids and can enhance how consumers receive these products. In December 2012, the Company launched its initial DROP products, PowerFuse, an energy formulation in a concentrated drop and ElectroFuse, an electrolyte formula in a concentrated drop, online, with the expansion into targeted retail distribution channels.

The Compan y is developing formulations and devices, which are compatible with alternative delivery systems for energy, medicines, vitamins and minerals, among other bioactives. These alternative systems include, but are not limited to, sublingual, transdermal and buccal drug delivery methods. use Science has developed and continues to advance, in conjunction with its scientific team, sublingual and transdermal delivery systems for bioactives that can effectively encapsulate and charge varying molecules in order to produce product formulations which can be consumed orally, applied topically or otherwise delivered sublingually or transdermally, thereby bypassing the gastrointestinal tract and entering the blood stream directly. The delivery technology is consists of encapsulation vesicles and ion exchange permeation enhancers. This technology utilizes a gradient across the mucosa membrane to help deliver the bioactive more efficiently through the mucosa.

The Company

Hot Medical Companies To Watch In Right Now: Curis Inc.(CRIS)

Curis, Inc., a drug discovery and development company, focuses on the research and development of cancer therapeutics. The company, under collaboration with Genentech, Inc., is conducting a pivotal Phase II clinical trial on its lead molecule, GDC-0449 in advanced basal cell carcinoma patients, as well as various Phase II clinical trials in first-line metastatic colorectal cancer and advanced ovarian cancer patients. It is also evaluating CUDC-101, a small molecule that is in a Phase I clinical testing and is designed to target histone deacetylase, epidermal growth factor receptor, and epidermal growth factor receptor 2. In addition, Curis has a development candidate, Debio 0932, which is a Heat Shock Protein 90 or Hsp90 inhibitor. The company holds a license agreement with Debiopharm related to its Hsp90 technologies. Further, it involves in preclinical testing for the development of candidates from its targeted cancer programs. The company was founded in 2000 and is base d in Lexington, Massachusetts.

Advisors' Opinion:

[By Monica Gerson]
Curis (NASDAQ: CRIS) dipped 18.97% to $3.16 in the pre-market session after the company reported Q3 financial results and provided CUDC-427 development update.

5 Best Financial Stocks To Watch For 2014: NeoStem Inc (NBS)

NeoStem, Inc., incorporated on September 18, 1980, operates in cellular therapy industry. Cellular therapy addresses the process by which new cells are introduced into a tissue to prevent or treat disease, or regenerate damaged or aged tissue, and consists of a separate therapeutic technology platform in addition to pharmaceuticals, biologics and medical devices. The Company�� business model includes the development of novel cell therapy products, as well as operating a contract development and manufacturing organization (CDMO) providing services to others in the regenerative medicine industry. Progenitor Cell Therapy, LLC, the Company�� wholly owned subsidiary (PCT), is a CDMO in the cellular therapy industry. PCT has provided pre-clinical and clinical current Good Manufacturing Practice (cGMP) development and manufacturing services to over 100 clients advancing regenerative medicine product candidates through rigorous quality standards all the way through to human testing.

PCT has two cGMP, cell therapy research, development, and manufacturing facilities in New Jersey and California, serving the cell therapy community with integrated and regulatory compliant distribution capabilities. Its core competencies in the cellular therapy industry include manufacturing of cell therapy-based products, product and process development, cell and tissue processing, regulatory support, storage, distribution and delivery and consulting services. The Company�� wholly-owned subsidiary, Amorcyte, LLC (Amorcyte) is developing its own cell therapy, AMR-001, for the treatment of cardiovascular disease. AMR-001 represents its clinically advanced therapeutic product candidate and enrollment for its Phase II PreSERVE clinical trial to investigate AMR-001's safety and efficacy in preserving heart function after a heart attack in a particular type of post Acute Myocardial Infarction (AMI) patients.

Through the Company�� subsidiary, Athelos Corporation (Athelos), the Company is collaborating w! ith Becton-Dickinson in early stage clinical development of a therapy utilizing T-cells, collaborating for autoimmune and inflammatory conditions, including but not limited to, graft vs. host disease, type 1 diabetes, steroid resistant asthma, lupus, multiple sclerosis and solid organ transplant rejection. The Company�� pre-clinical assets include its Very Small Embryonic Like (VSEL) Technology platform. The Company has basic research and development capabilities, manufacturing facilities on both the east and west coast of the United States.

Advisors' Opinion:

[By Monica Gerson]
NeoStem (NYSE: NBS) priced an underwritten public offering of 5,000,000 shares of common stock at an offering price of $7.00 per share. NeoStem shares dipped 9.44% to $7.10 in after-hours trading.
[By John Udovich]
Summer and the slow news for the market that usually comes with it�is over with and both stem cell researchers or small� cap stem cell stocks like Advanced Cell Technology, Inc (OTCBB: ACTC), Neuralstem, Inc (NYSEMKT: CUR), NeoStem Inc (NASDAQ: NBS), International Stem Cell Corp (OTCMKTS: ISCO)�and BioRestorative Therapies (OTCBB: BRTX) having news for investors and traders alike. Consider the following:
[By John Udovich]
From stem cell burgers to earnings reports, the stem cell industry and small cap players in it like NeoStem Inc (NASDAQ: NBS), International Stem Cell Corp (OTCMKTS: ISCO) and BioRestorative Therapies (OTCBB: BRTX) have been producing some news lately that has probably been overlooked by investors and traders alike given its August. Nevertheless, you might want to pay attention to the following stem cell news:

Hot Medical Companies To Watch In Right Now: CEL-SCI Corp (CVM)

CEL-SCI Corporation (CEL-SCI), incorporated on March 22, 1983, is engaged in the business of Multikine cancer therapy; New cold fill manufacturing service to the pharmaceutical industry, and ligand epitope antigen presentation System (LEAPS) technology, with two products, hemagglutinin type 1 and neuraminidase type 1 (H1N1) swine flu treatment for H1N1 hospitalized patients and CEL-2000, a rheumatoid arthritis treatment vaccine.

Multikine

CEL-SCI's Multikine, is being developed for the treatment of cancer. It is a cancer immunotherapy drugs called Combination Immunotherapy because it combines active and passive immunity in one product. It is the only cancer immunotherapy that both kills cancer cells and activates the general immune system to destroy the cancer. Multikine target the tumor micro-metastases for treatment failure. Multikine is also applicable in many other solid tumors.

New Manufacturing Facility

CEL-SCI's facility manufactures Multikine for CEL-SCI's Phase III clinical trial. CEL-SCI offers the use of the facility as a service to pharmaceutical companies and others, particularly those that need to fill and finish their drugs in a cold environment. Fill and finish is the process of filling injectable drugs in a sterile manner.

LEAPS

CEL-SCI's patented T-cell Modulation Process uses heteroconjugates to direct the body to choose a specific immune response. The heteroconjugate technology, referred to as LEAPS, is intended to stimulate the human immune system to fight bacterial, viral and parasitic infections, as well as autoimmune, allergies, transplantation rejection and cancer. Administered like vaccines, LEAPS combines T-cell binding ligands with small, disease associated and peptide antigens.

Using the LEAPS technology, CEL-SCI has created a peptide treatment for H1N1 (swine flu) hospitalized patients. This LEAPS flu treatment is designed to focus on the conserved, non-changing epitopes of the di! fferent strains of Type A Influenza viruses, including swine, avian or bird, and Spanish Influenza. CEL-SCI's LEAPS flu treatment contains epitopes.

Hot Medical Companies To Watch In Right Now: Amarantus Bioscience Holdings Inc (AMBS)

Amarantus BioScience Holdings, Inc., formerly Amarantus BioSciences, Inc., incorporated on March 22, 2013, is focuses on developing intellectual property and proprietary technology in order to develop drug candidates and diagnostic blood tests to diagnose and treat human diseases. The Company owns the intellectual property rights to a therapeutic protein known as Mesencephalic-Astrocyte-derived Neurotrophic Factor (MANF), owns the intellectual property rights to biomarkers related to oncology and neurodegeneration named BC-SeraPro and NuroPro respectively, has a license to an Alzheimer�� disease blood test named LymPro, and owns a number of proprietary cell lines called PhenoGuard. MANF was the first therapeutic protein discovered from a PhenoGuard Cell Line. In December 2012, the Company acquired neurodegenerative diagnostic portfolio from Power3 Medical Products. On March 22, 2013, the Company was merged with into Amarantus Bioscience Inc.

The Company also owns an inventory of 88 cell lines that Amarantus refers to as PhenoGuard Cell Lines. MANF is a protein that corrects protein misfolding. The Company�� MANF product development effort is centered on a therapy for Parkinson�� disease.

Advisors' Opinion:

[By James E. Brumley]
At first glance, Amarantus Bioscience Holdings, Inc. (OTCBB:AMBS) doesn't look like anything more than a volatile mess. It's up 17% today, but had been up twice that amount this morning. Even more exhausting is the fact AMBS, currently at $0.0529, had been as high as $0.089 and as low as $0.039 within the past three months. Point being, Amarantus Bioscience Holdings has been, and continues to be, all over the map.
[By Bryan Murphy]
I've taken bullish swings on - and been wrong to do so - Amarantus BioScience, Inc. (OTC:AMBS) before. My most recent bullish call on the budding biotech name was in April... a rally that fizzled shortly after I said it was just getting started. Somehow though, I find myself coming back to AMBS as a breakout candidate. This time, however, it's for a slightly different reason.

Hot Medical Companies To Watch In Right Now: Organovo Holdings Inc (ONVO)

Organovo Holdings, Inc. (Organovo), formerly Real Estate Restoration & Rental, Inc., incorporated in 2007, is a development-stage company. The Company has developed and is commercializing a platform technology for the generation of three-dimensional (3D) human tissues that can be employed in drug discovery and development, biological research, and as therapeutic implants for the treatment of damaged or degenerating tissues and organs. On December 28, 2011, Real Estate Restoration and Rental, Inc.�� (RERR) entered into an Agreement and Plan of Merger, pursuant to which RERR merged with its, wholly owned subsidiary, Organovo (Merger Sub). On February 8, 2012, the Company merged with and into Organovo Acquisition Corp. (Acquisition Corp.), a wholly owned subsidiary of Organovo, with the Company surviving the merger as a wholly owned subsidiary of Organovo Holdings (the Merger). As a result of the Merger, Organovo acquired the business of Organovo, Inc.

The Company has collaborative research agreements with Pfizer, Inc. (Pfizer) and United Therapeutic Corporation (Unither). As of March 31, 2012, it has five federal grants, including Small Business Innovation Research grants and developed the NovoGen MMX Bioprinter (its first-generation 3D bioprinter). The Company is engaged in the development of specific 3D human tissues to aid Pfizer in discovery of therapies in two areas of interest. In addition, in October 2011, it entered into a research agreement with Unither to establish and conduct a research program to discover treatments for pulmonary hypertension using its NovoGen MMX Bioprinter technology. Additionally, under the research agreement with Unither, the Company granted Unither an option to acquire from the Company a worldwide, royalty-bearing license in certain intellectual property created under the research agreement solely for use in the treatment or prevention of pulmonary hypertension and all other lung diseases.

The Company�� NovoGen MMX Bioprinter is an automate! d device that enables the fabrication of three-dimensional (3D) living tissues comprised of mammalian cells. A custom graphic user interface (GUI) facilitates the 3D design and execution of scripts that direct precision movement of the dispensing heads to deposit cellular building blocks (bio-ink) or supporting hydrogel. The Company is using a third party manufacturer, Invetech Pty., of Melbourne, Australia, to manufacture its NovoGen MMX Bioprinter. Its bioprinting technology and surrounding intellectual property and commercial rights serve as a platform for product generation across multiple markets that employ cell- and tissue-based products and services.

The Company competes with Organogenesis, Advanced BioHealing, Tengion, Genzyme, HumaCyte and Cytograft Tissue Engineering.

Advisors' Opinion:

[By Steve Symington]
To answer that question, remember what our fellow Fool Isaac Pino reminded us a few weeks ago:�high-end production 3-D printers from companies like 3D Systems, Stratasys (NASDAQ: SSYS ) , and ExOne (NASDAQ: XONE ) are capable of using dozens of materials to print infinitely more complicated items including shoes, saws, guitar bodies, and other functioning tools with moving parts.�Heck, 3-D bioprinting specialist�Organovo (NYSEMKT: ONVO ) is currently working feverishly on perfecting the process of designing and creating functional human tissue which -- putting inevitable regulatory hurdles for using the technology aside -- could obviously change the health care world as we know it.

Hot Medical Companies To Watch In Right Now: Universal Biosensors Inc (UBI)

Universal Biosensors, Inc. (Universal Biosensors) is an early-stage specialist medical diagnostics company focused on the research, development and manufacture of in vitro diagnostic test devices for consumer and professional point-of-care use. The Company uses its electrochemical cell technology platform to develop tests for a number of different markets. The Company�� principal activities are research and development, commercial manufacture of approved medical or testing devices and the provision of services including contract research work. The Company operates primarily in Australia. The Company uses its electrochemical cell technology platform to develop tests for a number of different markets. The Company has rights to a portfolio comprising patent applications owned by its wholly owned subsidiary, Universal Biosensors Pty Ltd, and a number of patents and patent applications licensed to the Company by LifeScan, Inc., an affiliate of Johnson & Johnson Company. Advisors' Opinion:

[By Namitha Jagadeesh]
Banco Popolare SC (BP) declined 3.5 percent to 1.29 euros and Unione di Banche Italiane SCPA (UBI) slid 2.3 percent to 4.93 euros after Societe Generale SA reduced its 12-month price forecast on the shares.

Hot Medical Companies To Watch In Right Now: RXi Pharmaceuticals Corp (RXII)

RXi Pharmaceuticals Corporation (RXi), incorporated on September 8, 2011, is a development-stage company. The Company is a biotechnology company focused on discovering, developing and commercializing therapies addressing medical needs using RNA interference (RNAi)-targeted technologies. As of July 12, 2012, RXi was focusing on its internal therapeutic development efforts in fibrosis. RXI-109 is its RNAi product candidate, which is a dermal anti-scarring therapy that targets connective tissue growth factor (CTGF). The Company�� therapeutic platform consists of two main components: RNAi Compounds (rxRNA) and Advanced Delivery Technologies. RNAi compounds include rxRNAori, rxRNAsolo and sd-rxRNA, or self-delivering RNA. On April 26, 2012, it completed the spin-off transaction from Galena Biopharma, Inc. (Galena).

In January 2011, the Company announced research results in collaboration with Generex Biotechnology Corporation, and RXi�� wholly owned subsidiary Antigen Express, Inc., in developing vaccine formulations for immunotherapy. In January 2011, it announced initial results as part of its collaboration with miRagen Therapeutics, Inc. in creating microRNA mimics, or artificial copies of microRNAs, using the Company�� sd-rxRNA technology. In February 2011, it announced the initiation of RXi�� development program for RXI-109.

Wednesday, December 18, 2013

Jim O'Neill - Don't Worry So Much About Tapering

Hot Energy Companies To Invest In Right Now

Jim O'Neill thinks that by now the market will not be surprised when the Fed starts to taper.

His point: Tapering is all people have been talking about for a year. This is not going to be a surprise.

When tapering does start he expects it will be done very slowly and very carefully. He does not foresee an immediate bear market for bonds like was experienced in 1994.

About the author:

Canadian Value

http://valueinvestorcanada.blogspot.com/

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Tuesday, December 17, 2013

Best Tech Companies To Buy Right Now

With shares of Cisco (NASDAQ:CSCO) trading around $21, is CSCO an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let�� analyze the stock with the relevant sections of our CHEAT SHEET investing framework.

T = Trends for a Stock’s Movement

Cisco designs, manufactures, and sells Internet protocol-based networking and other products related to communications, and provides services associated with these products and their use to information technology industries worldwide. The company provides a line of products for transporting data, voice, and video within buildings, across campuses, and around the world. Its products are designed to transform how people connect, communicate, and collaborate. Cisco operates in five segments: United States and Canada, European markets, emerging markets, Asia Pacific, and Japan.

Cisco shares plummeted in after-hours trading on Wednesday after the company posted third-quarter earnings and fourth-quarter guidance that came in below expectations. Cisco�� revenue rose just 1.8 percent during the third quarter — the company failed to make orders it planned on producing in emerging markets like Brazil, Mexico, India, and China. Analysts had expected growth of between 3 and 5 percent. According to The Wall Street Journal, Cisco blamed the National Security Agency scandal for its lost business in China.

Best Tech Companies To Buy Right Now: Global Testing Corporation Ltd (G31.SI)

Global Testing Corporation Limited, an investment holding company, provides IC testing services primarily in Singapore, the United States, Taiwan, the People�s Republic of China, Malaysia, and Canada. It offers various testing services, such as wafer sorting and final testing for logic and mixed signal ICs, including micro controller units, digital analog converters, image sensor controller ICs, consumer ICs, and high-speed interface controller ICs that are primarily used in consumer electronics and communication devices. The company�s testing services for the semiconductor industry also comprise marketing and test program development, conversion and optimization, and load board and probe card design, as well as leasing testers to customers for trial and pilot testing purposes. It also provides wafer testing services to the automotive devices industry. The company was founded in 1998 and is based in Hsin-Chu, Taiwan.

Best Tech Companies To Buy Right Now: Data I/O Corporation(DAIO)

Data I/O Corporation designs, manufactures, and sells programming systems used by designers and manufacturers of electronic products principally in the United States, Europe, and the Far East. Its programming system products are used to program integrated circuits (ICs), devices, or semiconductors. The company offers off-line and in-line automated programming systems, including RoadRunner Series of in-line automated programming systems that feature just-in-time in-line programming; PS Series of off-line medium/high volume and high mix automated systems, which support multiple media types; and FLX500, an off-line and moderate volume automated system that features self-learning plug-and-play operation. It also provides non-automated programming systems, including FlashPAK II/III, a low mix and low volume system that offers network control via Ethernet; Sprint/Unifamily, a low volume and engineering non-automated system; and FlashCORE, a programming architecture. In addition, the company provides services related to hardware support, system installation and repair, and device programming. It primarily serves users of programmable semiconductor devices, including original equipment manufacturers in wireless and consumer electronics and automotive electronics, and their electronic manufacturing service contract manufacturers. Data I/O markets and sells its products directly, as well as through internal telesales, and indirect sales representatives and distributors. The company was founded in 1969 and is headquartered in Redmond, Washington.

Top 10 Insurance Companies To Watch In Right Now: Linktone Ltd.(LTON)

Linktone Ltd., through its subsidiaries, provides entertainment-oriented telecom value-added services and content to mobile phone users over mobile telecommunications networks in China and Indonesia, as well as the 3G mobile telecommunications network in Indonesia. The company specializes in the development, aggregation, marketing, and distribution of user wireless content and applications for access by mobile phone users through three mobile network operators in China and nine mobile network operators in Indonesia. Its 2G short messaging service (SMS)-based services include ringtones, icons and screen savers, interactive SMS messaging in certain television programs, adventure, action, trivia and fortune-telling games, lunar and Western horoscopes, jokes, fan clubs, and event-driven or entertainment news updates. The company?s 2.5G services comprise multimedia messaging services, such as animated cartoons and screensavers, comic strips, magazine-style ?mobile articles? on various topics, and event-driven news updates; and WAP services, which consist of WAP-based ringtones, screensavers, games and dating services, and advanced Java games. It also offers audio-related services, including color ring-back tones; and interactive voice response services that allow users to listen to songs, jokes, stories, and coverage of various events. In addition, Linktone is launching 3G services in Indonesia, including e-paper/e-reading; video-on-demand on tablet devices and smart TVs; and radio streaming on mobile applications. Further, it distributes and sells home entertainment products, such as VCDs/DVDs/Blu-ray discs and video-on-demand in Singapore, Malaysia, and Indonesia; and engages in the theatrical distribution of movies, karaoke video licensing, karaoke system rental, and providing a karaoke-on-demand channel on Pay TV platforms. The company was founded in 1999 and is based in Shanghai, China. Linktone Ltd. is a subsidiary of MNC International Li mited.

Best Tech Companies To Buy Right Now: Firan Technology G Com Npv (FTG.TO)

Firan Technology Group Corporation, together with its subsidiaries, supplies aerospace and defense electronic products and subsystems primarily in Canada, the United States, Asia, and Europe. It operates in two segments, FTG Aerospace and FTG Circuits. The FTG Aerospace segment manufactures illuminated cockpit panels, keyboards, bezels, and sub assemblies for original equipment manufacturers of aviation products and airframe manufacturers. This segment�s products are interactive devices that display information, and contain buttons and switches used to input signals into an avionics box or aircraft. The FTG Circuits segment manufactures printed circuit boards for the aviation, defense, and other technology industries. The company also provides prototype development and manufacturing services. Firan Technology Group Corporation sells its products through direct sales people and manufacturers� representatives. Firan Technology Group Corporation was formerly known as Circui t World Corporation and changed its name to Firan Technology Group Corporation in May 2004. Firan Technology Group Corporation was founded in 1983 and is based in Toronto, Canada.

Best Tech Companies To Buy Right Now: CommVault Systems Inc. (CVLT)

CommVault Systems, Inc., together with its subsidiaries, provides data and information management software applications and related services primarily in North America, Europe, Australia, and Asia. The company develops, markets, and sells a suite of software applications and services under the Simpana brand. Its Simpana software suite includes solution for the backup and restoration of enterprise data for file systems, applications, databases, and virtual machine systems; integrated data archiving solution that optimizes data tiering and improves information governance; and enterprise-wide storage optimization for email and files reducing space on primary storage. The company also provides solutions for protection of critical applications and data with snapshots and real-time replication; solutions to analyze, discover, track, trend, and report on physical and virtual storage usage; and Web browser, which allows search, sort, select, and retrieval of corporate files and in formation from online, archive, and backup data copies. In addition, it offers assessment and design, implementation and post-deployment, training, consulting, and customer support services. The company markets and sells its software applications and related services directly to large enterprises, small and medium sized businesses, and government agencies, as well as indirectly through a network of value-added reseller partners, systems integrators, corporate resellers, and original equipment manufacturers. It licenses its software applications to customers in various industries, including banking, insurance and financial services, government, healthcare, pharmaceuticals and medical services, technology, legal, manufacturing, utilities, and energy. The company has strategic relationships with Dell, Inc.; Hitachi Data Systems; and NetApp. CommVault Systems, Inc. was incorporated in 1996 and is headquartered in Oceanport, New Jersey.

Advisors' Opinion:

[By Alex Planes]
What: Shares of CommVault Systems (NASDAQ: CVLT ) were up by as much as 13% at the start of trading this morning after the company reported earnings that beat expectations. However, the stock has been sliding lower all morning, and has now returned to the same level it reached at the close of trading yesterday.
[By Seth Jayson]
Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on CommVault Systems (Nasdaq: CVLT ) , whose recent revenue and earnings are plotted below.

Monday, December 16, 2013

Is the Fall in Lululemon a Buying Opportunity?

Lululemon (NASDAQ: LULU ) crashed by more than 11% on Thursday as the company´s earnings report included a worrisome reduction in sales and earnings guidance. Is the recent dip in Lululemon a buying opportunity or will competitors like Gap (NYSE: GPS ) and Under Armour (NYSE: UA ) capitalize the company´s problems to continue gaining market share in the yoga business?

Strong earnings, concerning guidance
The numbers for the third quarter where actually better than expected, Lululemon reported a year-over-year increase of 20% in revenue to $379.9 million. Comparable-store sales increased by a healthy 5% during the quarter and direct-to-consumer revenues were also strong with a 37.3% annual increase during the period.

Profit margins have been under pressure lately, and the recent quarter was no exception. Gross profit margins fell to 53.9% of revenue versus 55.4% in the third quarter of fiscal 2012 and operating margin declined to 24.3% of sales compared to 25.5% in the same quarter of the previous year.

Still, the company reported better than expected earnings per share of $0.45 versus $0.39 in year-ago quarter. Wall Street analysts were on average expecting earnings of $0.40 per share.

Guidance was a big disappointment though: management reduced its sales expectations for the fourth quarter of fiscal 2013 to between $535 million and $540 million versus a previous guidance of between $565 million and $570 million.

Same-store sales for the upcoming quarter are expected to be flat and management expects earnings per share to be in the range of $0.78 to $0.80, materially lower than the average Wall Street estimate of $0.84 per share. Lululemon also cut sales and earnings guidance for fiscal 2014.

CEO Christine Day pointed to macroeconomic factors and execution problems as the main reason for the disappointing guidance:

"This so far has been a year of challenges, learning, and growth for Lululemon, and while our outlook for the fourth quarter is being impacted by both macro and execution issues, I believe that the investments we are making in the business combined with the team in place create a strong platform for growth in the years ahead."

Mistakes and competitive pressure
Lululemon has made a series of expensive mistakes this year, in March, the company had to recall 17% of the yoga pants it had in stock due to excessive sheerness. Later in June, CEO Christine Day unexpectedly announced she was leaving the company once a replacement was found, which produced another steep decline in its stock.

Adding insult to injury, founder and Chairman Chip Wilson made some very unfortunate comments insinuating that women´s bodies may be to blame for the problems with the company´s products. "Frankly, some women's bodies just actually don't work", Wilson said on Nov. 5 in an interview with Bloomberg TV.

On Dec.9 Lululemon announced that Laurent Potdevin has been appointed as new CEO. The executive, who most recently served as President of TOMS Shoes, is taking charge in January 2014. In addition to this, Chip Wilson is resigning to the Chairman position. So, the recent disappointment comes in a time when investors in Lululemon were starting to have hopes of a better future as a new management team could streamline operations and leave the company´s problems in the past.

A renewed management team is clearly positive news for Lululemon, but investors need to consider that the company is now facing growing competitive challenges by the likes of Gap´s Athleta brand and Under Armour.

Athleta is opening new stores near existing Lululemon locations, benefiting from its traffic and undercutting Lululemon products in price by a considerable difference. In addition to this, Athleta is copying Lululemon´s marketing strategy by hooking up with yoga instructors and sponsoring all kinds of classes and similar activities to increase brand awareness. Athleta offers a wider variety of sizes than Lululemon, providing an alternative for customers who prefer a more inclusive brand and capitalizing on Wilson´s unfortunate comments.

Under Armour is also stepping up its efforts in women apparel, CEO Kevin Plank believes women apparel will generate around $1 billion in revenue for the company in 2016 and yoga could be a considerable opportunity for Under Armour in the coming years. Under Armour is clearly going after Lululemon with its marketing campaigns, the company recently launched big campaign for its studio yoga line using the tagline "We've Got You Covered" in clear reference to Lululemon´s sheerness problem.

Lululemon has been one of the most successful brands in the sports apparel business over the last years. But success attracts competition, and the company is now facing growing competitive pressure while at the same time it needs to recover from recent mistakes hurting its brand and image. The new management team will clearly be facing a demanding challenge in the coming quarters.

Bottom line: a visibility problem
Is management playing it safe by providing an excessively low guidance so it can easily over-deliver in the coming quarters? Or is increased competition from players like Gap and Under Armour seriously hurting Lululemon? Uncertainty usually creates opportunity, and there is plenty of uncertainty surrounding Lululemon. The company offers material upside potential if the new CEO can leave its problems behind and reignite growth in the coming quarters. On the other hand, Lululemon´s visibility problems go well beyond its pants.

Saturday, December 14, 2013

4 Overvalued DJIA Stocks: AmEx, Intel, 3M, Microsoft

It is a bull market and the Dow Jones Industrial Average and the S&P 500 Index have both challenged new all-time highs recently. For the market to keep rising, more stocks have to keep being bought up by investors. The problem is that investors do not want to overpay for a stock above the fair value.

24/7 Wall St. found that four of the thirty DJIA stocks are overvalued if you look at the average estimates from Wall Street analysts. Stocks have to be assigned some sort of value, and the Thomson Reuters consensus price target is one metric which many investors use as a judge of a stock’s upside potential. This shows that investors have to start thinking about what to do in shares of American Express Company (NYSE: AXP), Intel Corporation (NASDAQ: INTC), 3M Co. (NYSE: MMM) and Microsoft Corp. (NASDAQ: MSFT).

So what do you do when a stock is trading at or above the consensus price target? Some investors use that as a key to sell. Others try to see if the analysts will raise their price targets ahead. We wanted to take a look at the value now, and also to see if there was perhaps hidden upside in each.

American Express Company (NYSE: AXP) is worth almost $88 billion and its shares are very close to an all-time high. Friday’s closing price of $81.78 compares to a consensus price target of $81.83. AmEx has also traded in a range of $53.02 to $83.83, so the stock has even traded above the value that analysts think it is worth.

American Express gives investors a mere 1.1% dividend. That is low for a DJIA component and low for being a financial leader. We would point out that the street high on AmEx is $96 for a price target, so some analysts see the stock continuing to rise. Will investors buy an $81 stock just to make a $0.05 profit over a year, and is almost 17-times earnings a fair value for a financial stock?

Read Also: The Best & Worst DJIA Stocks of Earnings Season

Intel Corporation (NASDAQ: INTC) has handled earnings season far better than most expected with such a weak PC climate. At $24.09, its 52-week trading range is $19.23 to $25.98 and the consensus price target is down at $23.82. Intel’s market value is almost $120 billion and the trends in smartphones and tablets have so far wrecked intel’s growth.

It seems that not all may be lost here. We recently showed how Intel could be a stealth value stock as many analysts actually raised their valuations. Some analysts are even thinking a $30 stock is possible again. Intel is starting to see some traction for its processors for smartphones and tablets. It is very late to the party, but it is happening. Intel also pays investors a whopping 3.7% dividend yield and is valued at less than 13-times expected earnings..

3M Company (NYSE: MMM) has done very well this year with a 40% gain and its stock just hit a new all-time high of $128.02 on Friday. At $127.99, 3M has a consensus analyst price target of $126.94 and a 52-week range of $86.74 to $128.02.

The issue to consider with 3M is that the stock just keeps managing to outperform the broad market. Its yield of 2.0% is not massive yet not insulting. The highest analyst price target is actually up at $142 as well, which means that someone thinks another 10% can be made here. With an $86 billion market cap, some have to wonder if 3M can make it into the mega-cap club worth $100 billion or more. 3M trades at about 19-times expected earnings for this year.

Microsoft Corporation (NASDAQ: MSFT) managed to do incredibly better than expected with its earnings. Its market value is $315 billion and at $37.78 its consensus analyst price target is down at $35.77. Microsoft has even traded in a 52-week range of $26.26 to $38.22.

What is interesting about Microsoft is that Steve Ballmer is on his way out, and one analyst recently gave it a valuation of $45 and gave a path on getting the stock back to $50. Being valued at 14-times expected earnings is not too high on the surface, but the image from Wall Street is that Microsoft’s best days are behind it. Then there is the 3% dividend yield to consider.

We would also point out that this screen would have had six DJIA stocks trading above their consensus analyst values had the DJIA components not changed. Hewlett-Packard Company (NYSE: HPQ) closed at $25.94 and the consensus price target is down at $24.89 for H-P. Alcoa Inc. (NYSE: AA) was the other overvalued one at $9.06 versus a consensus price target of $8.47. We will leave evaluating those ex-DJIA stocks up to you.

Friday, December 13, 2013

Best Investments In 2014

Back on March 13th I penned some less-than-well-received thoughts on Cardiome Pharma Corp. (NASDAQ:CRME). Basically, I was warning that CRME was just one stumble away from a fairly significant selloff. Given that so many traders were a fan of the biotech stock at the time, merely posing the possibility of a dip was something of a threat to my life and limb.

A week later, CRME has fallen from post-split-adjusted price of $2.09 to a low of $1.70, moving under the very floor at $1.99 that was under attack at the time.

I didn't chime in regarding on Cardiome Pharma on March 21st to gloat, however. Mostly a revisited CRME a week later to reverse my call on the stock after the pullback, pointing out that the company still had a compelling pipeline, and was still putting some things into place to keep its then-in-jeopardy NASDAQ listing. In fact, I specifically said the stock was almost a buy, explicitly saying "Though we may not have hit the bottom yet, speculators don't necessarily have to avoid Cardiome Pharma Corp. at all costs. Traders just need to look for clear signs that a bounce is forming (like a higher close and/or a higher trading range), as that bounce has a good chance of following through. The waiting for that sign is the hardest part."

Best Investments In 2014: Provident Energy Ltd. (PVX)

Provident Energy Ltd. engages in the natural gas liquids (NGLs) infrastructure and marketing business in Canada and the United States. The company involves in the extraction, processing, storage, transportation, and marketing of NGLs, as well as offers these services to third party customers. It also provides fractionation, storage, NGL terminalling, loading, and offloading services. The company was founded in 1993 and is headquartered in Calgary, Canada.

Best Investments In 2014: Cirrus Logic Inc.(CRUS)

Cirrus Logic, Inc., a fabless semiconductor company, develops high-precision analog and mixed-signal integrated circuits (ICs) for audio and energy markets worldwide. The company offers analog and mixed-signal audio converter and audio digital signal processor (DSP) products, which include analog-to-digital converters (ADCs); digital-to-analog converters (DACs); chips for integrating ADCs and DACs into an IC; digital interface ICs; volume controls; and digital amplifiers, as well as audio DSPs for consumer electronics applications. Its audio products are used in various consumer applications, including portable media players, smartphones, tablets, AVRs, DVD and Blu-ray disc players, home theater systems, set-top boxes, MP3 players, gaming devices, sound cards, and digital televisions; professional applications comprising digital mixing consoles, multitrack digital recorders, and effects processors; automotive applications consisting of amplifiers, satellite radio systems, telematics, and multi-speaker car-audio systems; and networked digital audio applications. The company also provides high-precision analog and mixed-signal ICs for energy control, energy measurement, and energy exploration applications; and ICs, board-level modules, and hybrids under the Apex Precision Power brand name for high-power pulse width modulation (PWM) and power amplifier applications; and proprietary products, which include ADCs, DACs, linear amplifiers, PWM amplifiers, and amplifier ICs; and system reference designs. Its energy products are used in digital utility meters, power supplies, lighting ballasts, motor control, energy exploration, and high-power systems. The company sells its products primarily to through direct sales force, external sales representatives, and distributors. Cirrus Logic, Inc. was founded in 1984 and is headquartered in Austin, Texas.

Advisors' Opinion:

[By Selena Maranjian]
It's not just the overall stock market today that's volatile: Individual stocks can be even more zigzaggy. Consider audio-chip maker Cirrus Logic (NASDAQ: CRUS ) , which supplies many of Apple's (NASDAQ: AAPL ) iDevices. Between April 16 and April 18 of this year, the stock tanked by more than 17%, and it lost about 20% on May 23. Why? Well, about 90% of its revenue is tied to Apple, and Apple's position in the stock market today isn't what it used to be, with Steve Jobs gone, growth slowing, and margins being pressured. In mid-April, Cirrus warned of disappointing upcoming results, and got punished for that. In May, management cited profit-margin pressures of its own, along with competition and a maturing smartphone environment.
[By Rick Munarriz]
That March 4 low held until today, and a few factors are weighing on the hit.
DIGITIMES�-- the Asian tech publication that's well connected to Apple's suppliers -- is reporting that iPad shipments may dip by as much as 30% sequentially. Upstream sources are telling DIGITIMES that demand has been softening for the smaller tablet that was an initial hit during the holiday season. Cirrus Logic (NASDAQ: CRUS ) warned of a big inventory charge in the quarter. As the company that provides audio chips in Apple's iPhone, the news is being interpreted as soft demand for Apple's iconic smartphone. Samsung -- the biggest thorn in Apple's side when it comes to smartphones -- announced this morning that its Galaxy S4 will be available through seven stateside wireless carriers later this month. The bar-raising smartphone is powered by Google's Android. Many of the leading carriers were already starting to take pre-orders for the device, but it wasn't clear if it would hit the market this month or potentially early next month. Analysts at Bernstein Research and Goldman Sachs offered up earnings preview notes ahead of next week's quarterly report. As one might imagine, the tone is cautious.
Expect the volatility to continue until Apple actually does report on Tuesday, and then, naturally the shares will move higher or lower based on the report and the tech bellwether's assessment of what its near-term future looks like.
[By Dan Caplinger]
Beyond the Dow, earnings also had a big impact. Cirrus Logic (NASDAQ: CRUS ) has plunged nearly 14% after releasing preliminary figures for its just-ended fiscal fourth quarter. The major supplier for Apple cited "a decreased forecast for a high volume product" as justifying its warning for both the previous and current quarters, and a Wall Street analyst followed suit with a downgrade of Cirrus stock. Apple also dropped further, with its 4.7% decline leading the stock to flirt with the $400 level, which it hasn't breached since late 2011.

10 Best Value Stocks To Own For 2014: STARWOOD PROPERTY TRUST INC.(STWD)

Starwood Property Trust, Inc., a real estate investment trust, primarily focuses on originating, investing in, financing, and managing commercial mortgage loans and other commercial real estate debt investments, commercial mortgage-backed securities, and other commercial real estate-related debt investments. It also focuses to invest in commercial properties subject to net leases, residential mortgage loans, and residential mortgage-backed securities. SPT Management, LLC serves as the manager of Starwood Property Trust, Inc. The company qualifies as a real estate investment trust for federal income tax purposes and would not be subject to federal corporate income taxes, if it distributes at least 90% of its taxable income to its stockholders. Starwood Property Trust was founded in 2009 and is headquartered in Greenwich, Connecticut.

Advisors' Opinion:

[By Chris Hill]
In this installment, our analysts discuss some of the day's big movers and shakers.�Shares of Level 3 Communications (NYSE: LVLT ) rise after Deutsche Bank initiates coverage with a buy rating. Trading in Herbalife (NYSE: HLF ) is halted after the company's auditor resigns. Cliffs Natural Resources (NYSE: CLF ) gains ground on the news that inflation in China is slowing. And Starwood Property Trust (NYSE: STWD ) declines after the real estate company announces a secondary stock offering.�
[By Doug Fabian]
This fund is pegged to the FTSE NAREIT All Mortgage Capped Index, a benchmark measure that includes top names in the space such as Annaly Capital (NLY), American Capital Agency Corp. (AGNC), Starwood Property Trust (STWD) and Two Harbors Investment Corp. (TWO).
[By Amanda Alix]
Other companies are currently mulling single-family REIT IPOs, too. Colony recently announced�that it plans to spin off its Colony American Homes, which owns over 9,500 homes with average monthly rents of $1,277. Barry Sternlicht, CEO of commercial mortgage investment REIT Starwood Property Trust (NYSE: STWD ) has also said that he is seriously considering�spinning off his company's real estate holdings into a single-family REIT within the next few months.

Best Investments In 2014: Saks Incorporated(SKS)

Saks Incorporated operates retail stores in the United States. Its stores offer an assortment of fashion apparel, shoes, accessories, jewelry, cosmetics, and gifts. The company operates stores under the brand name of Saks Fifth Avenue (SFA) that are principally free-standing stores in shopping destinations or anchor stores in upscale regional malls. It also operates Saks Fifth Avenue OFF 5TH (OFF 5TH) stores, which are primarily located in upscale mixed-use and off-price centers. As of January 28, 2012, the company operated 46 SFA stores; and 60 OFF 5TH stores. Saks Incorporated also sells its products online at saks.com, as well as through catalogs. The company was founded in 1919 and is headquartered in New York, New York.

Advisors' Opinion:

[By Rich Duprey]
The own of upscale retailer Lord & Taylor is adding another luxury nameplate to its portfolio. Canadian shop Hudson's Bay will buy Saks (NYSE: SKS ) , the two retailers jointly announced, in a deal valued at about $2.9 billion, including debt.
[By Andrew Marder]
For a company that is putting up solid sales growth, has a great brand, and has seen its stock price rise more than 40% in the last 12 months, Saks (NYSE: SKS ) didn't demand much of a premium. Hudson's Bay, the operator behind Lord & Taylor, picked up Saks for just $16 per share, representing a 4.5% bump to Friday's closing price.
[By Paul Ausick]
The only earnings reports of note since last Friday came from Saks Inc. (NYSE: SKS) which is trading down 0.2% at $15.99.

Before markets open Tuesday morning we are scheduled to hear results from Perfect World Co. Ltd. (NASDAQ: PWRD), Urban Outfitters Inc. (NASDAQ: URBN), Barnes & Noble Inc. (NYSE: BKS) which announced a new video app today, Best Buy Co. Inc (NYSE: BBY) which is included in our preview of this week�� results from retailers, Dick�� Sporting Goods Inc. (NYSE: DKS), Home Depot Inc. (NYSE: HD), J.C. Penney Co. Inc. (NYSE: JCP), and Trina Solar Ltd. (NYSE: TSL).
[By Chris Hill]
Hertz (NYSE: HTZ ) dips on good-not-great earnings. Candian retailer Hudson's Bay buys Saks (NYSE: SKS ) for $2.4 billion. Wynn Resorts' (NASDAQ: WYNN ) second-quarter profit gets hit with one-time charges. Omnicom Group (NYSE: OMC ) merges with Publicis Group to form the world's largest advertising and marketing firm. In this segment from Investor Beat, Motley Fool analysts Bill Barker and Andy Cross discuss four stocks making moves on Tuesday.

Best Investments In 2014: Family Dollar Stores Inc.(FDO)

Family Dollar Stores, Inc. operates a chain of self-service retail discount stores primarily for low and middle income consumers in the United States. The company offers consumables, including household chemicals, paper products, candy and snack products, health and beauty aids, hardware and automotive supplies, and pet food products and supplies; and home products, which comprise domestics, housewares, giftware products, and home decor products. It also provides apparel products and accessories consisting of men?s and women?s clothing products, boys? and girls? clothing products, infants? clothing products, shoes, and fashion accessories; and seasonal products and electronics, such as toys, stationery and school supplies, seasonal goods, and personal electronics. As of August 11, 2011, the company operated approximately 7,000 stores in rural and urban settings across 44 states. Family Dollar Stores, Inc. was founded in 1959 and is headquartered in Matthews, North Carolina .

Advisors' Opinion:

[By Brendan Byrnes]
Brendan: Not a problem at all. What about the surprising amount of dollar-store companies that are public? You have Family Dollar (NYSE: FDO ) , Dollar Tree (NASDAQ: DLTR ) , Dollar General (NYSE: DG ) . You mention, in particular, Family Dollar, which is the lowest market cap out of all of those, as doing the best, an exceptional company. Why?
[By Casey Kelly-Barton]
While the overall national and global impact of the shutdown will take time to analyze, some big businesses have been up-front about the immediate impact. Family Dollar Stores (NYSE: FDO ) says the shutdown hit its sales right away (although the company is in growth mode), and Stanley Black & Decker and W.W. Grainger�voiced profit and sales concerns, respectively. The shutdown also created an FCC review backlog for new products from Apple, Google and other tech businesses.
[By Joseph Hogue]
Between Sept. 14 and Nov. 15 last year, as investors rushed to companies with solid, government-proof revenue, Family Dollar (NYSE: FDO) gained 2.6%, and Kellogg (NYSE: K) surged 7.4%.