Top US Insurance: March 2014

Monday, March 31, 2014

Should You Put Your Money In Hewlett-Packard?

When it comes to Hewlett-Packard (HPQ) there are two types of sentiments that can be seen. On one hand several analysts and industry experts are getting excited about all the turnaround that is going on under the leadership of Meg Whitman. According to them the computer giant has been increasingly gaining in the previous few months as the company stabilized its business and started venturing into new areas. On the other hand there are several analysts who are unable to understand all the excitement and fuss about HP. To them the company is hardly making any improvement.

Let's take a quick look at both the sides and then decide whether things are actually improving for the company or not.

The bear case HP's recent earnings have brought to light a few points for which many can't consider that any kind of turnaround is going on in the company. The top-line of the company has plunged in the past two years in a row, and even the projection for the coming year is lower than the current year's figure.

PC sales, the primary business driver, was also down by 10% in both 2013 and 2012 and though the figure is expected to surge by only 2% in the current fiscal year, the surge is not significant enough o pull HP out of trouble. Next, coming to services and enterprise revenues, both the segments were down in the last fiscal and the overall trend is expected to remain the same going forward.

One analyst also pointed out the Meg Whitman's $15 billion worth of software-related acquisitions is not paying off accordingly. Such an investment is roughly expected to boost the top-line by at least $1 billion, but in reality the surge in the revenue was just $300 million. Because of all these analysts doubt if at all any turnaround is happening.

The bull case All the above points are true no doubt. But the fact remains that Meg Whitman is in her second year of the five year turnaround plan and we must give her the time before writing off HP from our books. The turnaround signs need not necessarily be in the historic figure. They can also be hidden in the company's actions and future plans.

The computer giant is shifting its focus from just manufacturing devices to services such as cloud, big data, security as well as 3D printing which many analysts believe might single handedly support the company's turnaround. HP also introduced its latest converged system portfolio – a host of interlinked services from HP using its own server, storage and networking capabilities. The components of the offering come together to provide a 360 degree solution to make information technology requirements even simpler.

HP is also paying adequate attention to the growing needs of the consumer electronics space. Its two latest gadgets – Slate 6 and Slate 7 tablets - have already created some ripples in the highly crowded tablet space. In days to come the company intends to concentrate on expanding its product portfolio, reducing costs and maintaining healthy margins.

Departing thoughts Despite discouraging numbers in the recent past, HP seems to have a lot of upside potential. Taking into account all that's going on in the company and Meg Whitman's determined and well planned moves, it can be said that the turnaround is surely in the making. The company still has three years in its hands to improve its performance and prove the critics wrong. Huge growths are expected across verticals with special focus being on 3D printing. To drive home the discussion, I feel HP has a strong chance to become the top-dog.

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Sunday, March 30, 2014

5 Best High Dividend Stocks To Buy For 2014

Last week, around 42 companies announced a high dividend. I published all stocks with dividend growth from the recent week in the attached dividend list. In average, stocks from the list of the latest dividend growth stocks have increased their dividend payments by 15.51%.

It�� always good to see how the dividend growth strategy works. Some of the dividend growers have raised their payments forty times and more. The biggest names come from the oil and gas sector. Eni and Total are the two biggest stocks followed by the British spirit maker Diageo.

Five of the results have a double-digit dividend yield and seven yielding above five percent. Analysts and brokerage firms recommend more than half, 26 in total, of the dividend growth stocks.

Here are my favorite dividend growth stocks:

Teva Pharmaceuticals (TEVA) has a market capitalization of $34.16 billion. The company employs 45,948 people, generates revenue of $20.317 billion and has a net income of $1.956 billion. Teva Pharmaceuticals�� EBITDA amounts to $6.055 billion. The EBITDA margin is 29.80% (the operating margin is 10.85% and the net profit margin 9.63%).

5 Best High Dividend Stocks To Buy For 2014: Signet Jewelers Limited(SIG)

Signet Jewelers Limited operates as a specialty jewelry retailer in the United States, the United Kingdom, the Republic of Ireland, and the Channel Islands. The company retails jewelry, watches, and associated services. As of January 28, 2012, it operated a network of 1,318 stores in 50 states in the United States that trade nationally in malls and off-mall locations as ?Kay Jewelers?, and regionally under various mall-based brands, as well as operated as destination superstores under the ?Jared The Galleria Of Jewelry? trade name. The company also operated a network of 535 stores in the United Kingdom, including 14 stores in the Republic of Ireland and 3 in the Channel Islands under the ?H.Samuel?, ?Ernest Jones?, and ?Leslie Davis? trade names in high street locations and shopping malls. Signet Jewelers Limited was founded in 1950 and is based in Hamilton, Bermuda.

Advisors' Opinion:

[By Rich Duprey]
Specialty jeweler�Signet Jewelers� (NYSE: SIG ) announced today its third-quarter dividend of $0.15 per share, the same rate it paid last quarter after raising the payout 25% from $0.12 per share.

5 Best High Dividend Stocks To Buy For 2014: DaVita HealthCare Partners Inc (DVA)

DaVita HealthCare Partners Inc., formerly DaVita Inc., incorporated on April 4, 1994, is a provider of dialysis services in the United States for patients suffering from chronic kidney failure, also known as end stage renal disease (ESRD). As of December 31, 2011, the Company provided dialysis and administrative services through a network of 1,809 outpatient dialysis centers located in the United States throughout 43 states and the District of Columbia, serving a total of approximately 142,000 patients. It also provides acute inpatient dialysis services in approximately 900 hospitals and related laboratory services throughout the United States. In addition, as of December 31, 2011, it provided dialysis and administrative services to a total of 11 outpatient dialysis centers located in three countries outside of the United States. On September 2, 2011, the Company acquired CDSI I Holding Company, Inc., the parent company of dialysis provider DSI Renal Inc. In November 2011, the Company announced that its wholly owned European subsidiary, DV Care GmbH, acquired ExtraCorp AG. In January 2012, the Company acquired controlling interest in NephroLife. In September 2012, the Company announced that its new guest services contact center located in Centennial, Colorado was opened. On November 1, 2012, the Company announced the consummation of the merger of HealthCare Partners Holdings, LLC (HCP), with Seismic Acquisition LLC, a wholly owned subsidiary of the Company, with HCP as the surviving entity (the Merger). The Merger, HCP became a wholly owned subsidiary of the Company. In January 2013, the Company acquired nine dialysis centers from Fresenius Medical Care (FMC), provider of dialysis services and manufacturer of dialysis products.

During the year ended December 31, 2011, the Company acquired a total of 178 dialysis centers, eight of which were located outside of the United States, opened 65 new dialysis centers, sold two centers, merged seven centers, and divested a total of 30 dialysis cent! ers in connection with the acquisition of DSI. It also added three dialysis centers under management and administrative service agreements that are located outside of the United States and added one center in which the Company owns a minority equity interest. The Company�� United States dialysis and related laboratory services business accounts for approximately 93% of its consolidated net operating revenues. Its other ancillary services accounted for approximately 7% of its consolidated net operating revenues during the year ended December 31, 2011.

Dialysis and Related Lab Services

As of December 31, 2011, the Company operated or provided administrative services through a network of 1,809 outpatient dialysis centers located in the United States and 11 outpatient dialysis centers located outside the United States that are designed specifically for outpatient hemodialysis. Many of the Company�� outpatient dialysis centers offer certain support services for dialysis patients who prefer and are able to perform either home-based hemodialysis or peritoneal dialysis in their homes. Home-based hemodialysis support services consist of providing equipment and supplies, training, patient monitoring, on-call support services and follow-up assistance. Registered nurses train patients and their families or other caregivers to perform either home-based hemodialysis or peritoneal dialysis.

As of December 31, 2011, the Company provided hospital inpatient hemodialysis services, excluding physician services, to patients in approximately 900 hospitals throughout the United States. It renders these services for a contracted per-treatment fee that is individually negotiated with each hospital. When a hospital requests the Company�� services, the Company administers the dialysis treatment at the patient�� bedside or in a dedicated treatment room in the hospital, as needed. In 2011, hospital inpatient hemodialysis services accounted for approximately 4.5% of its total United S! tates dia! lysis treatments. The Company owns two licensed clinical laboratories, which specialize in ESRD patient testing. These laboratories provide routine laboratory tests for dialysis and other physician-prescribed laboratory tests for ESRD patients. Its laboratories provide these tests primarily for its network of ESRD patients throughout the United States. These tests are performed to monitor a patient�� ESRD condition, including the adequacy of dialysis, as well as other medical conditions. During 2011, it operated or provided management and administrative services to 33 outpatient dialysis centers located in the United States and three outpatient dialysis centers located outside of the United States, in which it either owns a minority equity investment or are wholly owned by third parties. These services are provided pursuant to management and administrative services agreements.

Ancillary services and strategic initiatives

DaVita Rx is a pharmacy that provides oral medications to DaVita�� patients with ESRD. HomeChoice Partners provides personalized infusion therapy services to patients typically in their own. Intravenous and nutritional support therapies are typically managed by registered and/or board-certified professionals, including pharmacists, nurses and dieticians in collaboration with the patient�� physician in support of the patient�� ongoing health care needs. VillageHealth provides advanced care management services to health plans and Government agencies for employees/members diagnosed with Chronic Kidney Disease (CKD) or ESRD. Lifeline provides management and administrative services to physician-owned vascular access clinics that provide surgical and interventional radiology services for dialysis patients. Lifeline also is the owner of one vascular access clinic. DaVita Clinical Research conducts research trials principally with dialysis patients and provides administrative support for research conducted by DaVita-affiliated nephrology practices. DaVita Neph! rology Pa! rtners offers practice management and administrative services to physicians who specialize in nephrology. Practice management and administrative services include operations management, information technology support, billing and collections, credentialing and coding, and other support functions.

The Company competes with Fresenius Medical Care.

Advisors' Opinion:

[By Monica Wolfe]
DaVita Health Care Partners (DVA)
Fournier�� second largest holding is in DaVita Health Care Partners. The guru holds on to 2,675,972 shares, representing 2.54% of the company�� shares outstanding and 6% of his total portfolio.
[By Eric Volkman]
Shares of DaVita HealthCare Partners� (NYSE: DVA ) look like they might need a little care following the release of the company's Q3 results. For the quarter, revenues totaled $2.1 billion, an improvement over the $1.8 billion the company posted in the same period the previous year. Attributable net income went in the opposite direction, however, coming in at $136.6 million ($0.64 per diluted share) versus the Q3 2012 result of $144.7 million ($0.75).
[By Keith Speights]
1. Keep it simple
Buffett likes to keep things simple and understand the business before he buys. DaVita Healthcare Partners (NYSE: DVA ) is a great example of this desired simplicity. The company provides dialysis services for patients with chronic kidney disease or end stage renal disease. Patients with these diseases can't survive without dialysis. DaVita provides the service. It doesn't get much more simple than that.
[By Holly LaFon]
Last quarter, there were four winners: Chihin, Errold, Luishernandez and Clemo69. They correctly guessed that Buffett bought DaVita (DVA), Wells Fargo (WFC) and IBM (IBM). Congratulations!

Top Oil Stocks To Buy For 2014: Alliance Fiber Optic Products Inc.(AFOP)

Alliance Fiber Optic Products, Inc. engages in the design, manufacture, and marketing of a range of fiber optic components and integrated modules incorporating these components to communications equipment manufacturers and service providers in North America, Europe, and Asia. The company offers interconnect devices that are used to connect optical fibers and components; couplers and splitters that are used to divide and combine optical power; and dense wavelength division multiplexing (DWDM) devices that separate and combine multiple specific wavelengths. Its connectivity products include connectivity modules; optical connectors, adapters, and cable assemblies; fused and planar fiber optical splitters and couplers; optical tap couplers and ultra low polarization dependent loss tap couplers; amplifier wave division multiplexing (WDM) couplers; optical fixed attenuators; and fused fiber WDM couplers. The company?s optical passive products comprise filter WDMs, amplifier fil ter WDMs, DWDMs, coarse WDMs, compact coarse WDMs, add/drop DWDM filters, optical isolators, optical bypass switches, and automatic variable optical attenuators. Its products are deployed in long-haul networks that connect cities; metropolitan networks that connect areas within cities; last mile access networks that connect to individual businesses and homes; and enterprise networks within businesses. The company sells its products to communications equipment manufacturers who incorporate its products into their systems and sell them to network service providers, as well as to other component manufacturers for resale or inclusion in their products. Alliance Fiber Optic Products, Inc. was founded in 1995 and is headquartered in Sunnyvale, California.

Advisors' Opinion:

[By Michael A. Robinson]
During the same five years, a small-cap play on high-speed digital networks did almost as well. Alliance Fiber Optic Products Inc. (Nasdaq: AFOP) has rallied nearly 785%, turning $25,000 into $221,250.
[By Michael A. Robinson]
Enter Alliance Fiber Optic Products Inc. (Nasdaq: AFOP). Basically, Alliance helps make fiber-optic technology possible for homes and businesses.
[By Monica Gerson]
Alliance Fiber Optic Products (NASDAQ: AFOP) shares rose 7.21% to $21.70. The volume of Alliance Fiber Optic Products shares traded was 397% higher than normal. Alliance Fiber Optic lifted its Q3 revenue outlook.

5 Best High Dividend Stocks To Buy For 2014: Occidental Petroleum Corporation(OXY)

Occidental Petroleum Corporation, together with its subsidiaries, operates as an oil and gas exploration and production company primarily in the United States. The company operates in three segments: Oil and Gas; Chemical; and Midstream, Marketing, and Other. The Oil and Gas segment explores for, develops, produces, and markets crude oil, natural gas liquids, and condensate and natural gas. Its domestic oil and gas operations are located in Texas, New Mexico, California, Kansas, Oklahoma, Utah, Colorado, North Dakota, and West Virginia; and international oil and gas operations are located in Bahrain, Bolivia, Colombia, Iraq, Libya, Oman, Qatar, the United Arab Emirates, and Yemen. As of December 31, 2010, this segment had proved reserves of approximately 3,363 million barrels of oil equivalent. The Chemical segment manufactures and markets basic chemicals, including chlorine, caustic soda, chlorinated organics, potassium chemicals, and ethylene dichloride products; vinyls, such as vinyl chloride monomer and polyvinyl chloride; and other chemicals comprising chlorinated isocyanurates, resorcinol, sodium silicates, and calcium chloride products. The Midstream, Marketing, and Other segment gathers, treats, processes, transports, stores, purchases, and markets crude oil that includes natural gas liquids and condensate, as well as natural gas and carbon dioxide. This segment also involves in the power generation; and trades around its assets comprising pipelines and storage capacity, as well as oil and gas, other commodities, and commodity-related securities. Occidental Petroleum Corporation was founded in 1920 and is based in Los Angeles, California.

Advisors' Opinion:

[By Tyler Crowe and Aimee Duffy]
In the following video, Fool.com energy contributors Tyler Crowe and Aimee Duffy discuss a recent cease-fire within Occidental Petroleum (NYSE: OXY ) between the company's chairman of the board and former CEO Ray Irani, and the current CEO Steve Chazen. While Irani was rumored to have been looking to replace Chazen, support for Chazen from shareholders has resulted in the company announcing that he will remain CEO until at least the end of 2014. What could this mean for Occidental's share price, which has lagged the market for the past couple years? Tyler tells investors how this development will affect the company, and what to look for as Occidental moves into the future.

5 Best High Dividend Stocks To Buy For 2014: iShares MSCI Emerging Markets ETF (EEM)

iShares MSCI Emerging Markets Index Fund (the Fund) seeks to provide investment results that correspond generally to the price and yield performance of the MSCI Emerging Markets Index (the Index). The Index is designed to measure equity market performance in the global emerging markets. The Index was developed by Morgan Stanley Capital International Inc. as an equity benchmark for emerging market stock performance. The Index is a capitalization-weighted index that aims to capture 85% of the (publicly available) total market capitalization. Component companies are adjusted for available float and must meet objective criteria for inclusion in the Index. The Index is reviewed quarterly.

The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. The Fund's investment advisor is Barclays Global Fund Advisors.

Advisors' Opinion:

[By Benjamin Shepherd] The S&P 500 has gained 18.8 percent so far this year, but the emerging markets—using the iShares MSCI Emerging Markets Index (NYSE: EEM) as a proxy—have slid by nearly 6 percent. Investors are worried that China’s economy is slowing and the US Federal Reserve might end its quantitative easing program.

Saturday, March 29, 2014

How A Nadex Binary Is Impacted By Implied Volatility

Implied Volatility can impact the price of an option more than any other factor.

Implied Volatility is a fancy word for an expected move. The longer there is until expiration, the more time there is for the market to move. This is why a binary will be worth more the longer there is until expiration.

In addition, "implied volatility" increases the premium cost of the binary as a large move is expected to take place. For example, before the FOMC or NFP Report, with two hours until expiration, a binaries premium will be closer to $50 than it would be at midnight, when no news is expected within the next two hours and when expected movement is normally low.

If you bought an OTM binary strike both above and below the market several hours before a news event, you may see both sides be profitable, even though the market has not moved and time has passed. This is due to the expected movement flooding into the options market and causing the premium to rise.

Related: What Is A Nadex Binary Option?

Understanding how implied volatility impacts the price of a binary option, by time and by pending government news events, can help a trader know whether they should pay or collect premium to take advantage of the rise or fall in the implied volatility impacting the binary's price.

A simple illustration can be seen in the same phenomenon on stock options before an earnings release. The implied volatility gets sucked out of the binary after the release has happened. Even more premium is removed when there is little movement after a large expected move. This is known as a volatility crush.

Notice the highlighted example below, that shows how the implied volatility for options on AAPL rose before th

Friday, March 28, 2014

Hennessy: Two Ways to Play Japan

We've decided to deepen our roster of Japan stock fund; here are two fund ideas from the Hennessy Fund family that have been good performers in the Japan space in recent years, suggests Walter Frank, editor of MoneyLetter.

Hennessy Funds is a relatively small firm with $4 billion under management, including 16 mutual funds. Its funds use both active and passive management strategies and all are managed with a team approach.

The strategies aim to dampen risk and preserve apical during volatile periods and to maximize long-term returns. "Fads and emotions have no place in our investment process," states Hennessy.

Hennessy Japan (US:HJPNX) and Hennessy Japan Small-Cap (US:HJPSX) share very similar strategies—they just look for stocks in different capitalization ranges.

Management teams at the respective funds search out "companies with strong businesses and management, trading at attractive pries." They use in-depth research and analysis plus on-site research to identify a significant "value gap."

Both portfolios are limited to the best ideas generated by the fund managers, who build portfolios without concern to the benchmark indexes.

The differences? Japan Small-Cap chooses stocks from the bottom 15% of Japanese firms in market cap while Japan Fund has two-thirds of assets in large-caps. The latter also has a concentrated number of holdings.

In each year, since its inception in 2007, Japan Small-Cap has bested Japan Fund except in the difficult 2011 environment. In fact, Japan Small-Cap places head of at least 94% of Japan stock funds in the trailing one-, three- and five-year periods. Recently, it had 62 holdings.

Hennessy Japan, while lagging its small-cap sibling over the five years, has nonetheless put up impressive numbers within the Japan category space, well within the top 20% for the same trailing time frames. As noted, the portfolio is concentrated with only 23 stock holdings.

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Thursday, March 27, 2014

Best Gold Companies To Watch In Right Now

On Wednesday, Silvercorp Metals (NYSE: SVM ) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Silvercorp Metals was already making its investors suffer before April's big swoon for the gold and silver markets. Now, narrowing profit margins due to low silver prices could further squeeze silver miners and eventually threaten their profitability. Let's take an early look at what's been happening with Silvercorp Metals over the past quarter and what we're likely to see in its quarterly report.

Best Gold Companies To Watch In Right Now: CME Group Inc.(CME)

CME Group Inc. operates the CME, CBOT, NYMEX, and COMEX regulatory exchanges worldwide. The company provides a range of products available across various asset classes, including futures and options on interest rates, equity indexes, energy, agricultural commodities, metals, foreign exchange, weather, and real estate. It offers various products that provide a means of hedging, speculation, and asset allocation relating to the risks associated with interest rate sensitive instruments, equity ownership, changes in the value of foreign currency, credit risk, and changes in the prices of commodities. CME Group owns and operates clearing house, CME Clearing, which provides clearing and settlement services for exchange-traded contracts and counter derivatives transactions; and also engages in real estate operations. Its primary trade execution facilities consist of its CME Globex electronic trading platform and open outcry trading floors, as well as privately negotiated transact ions that are cleared and settled through its clearing house. In addition, the company offers market data services comprising live quotes, delayed quotes, market reports, and historical data services, as well as involves in index services business. CME Group?s customer base includes professional traders, financial institutions, institutional and individual investors, corporations, manufacturers, producers, and governments. It has strategic partnerships with BM&FBOVESPA S.A., Bursa Malaysia Derivatives, Singapore Exchange Limited, Green Exchange, Dubai Mercantile Exchange, Johannesburg Stock Exchange, and Bolsa Mexicana de Valores, S.A.B. de C.V., as well as joint venture agreement with Dow Jones & Company. The company was formerly known as Chicago Mercantile Exchange Holdings Inc. and changed its name to CME Group Inc. in July 2007. CME Group was founded in 1898 and is headquartered in Chicago, Illinois.

Advisors' Opinion:

[By Wallace Witkowski]
Insurers such as Aflac Inc. (AFL) ,�Allstate Corp. (ALL) , Aetna Inc. (AET) , Cigna Corp. (CI) �and Prudential Financial Inc. (PRU) �will also report, along with exchange operators Nasdaq OMX Group Inc. (NDAQ) �and CME Group Inc. (CME) .�
[By Roberto Pedone]
One financial market player that's starting to move within range of triggering a major breakout trade is CME Group (CME), which offers products across all major asset classes based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, metals, weather and real estate. This stock has been in play with the bulls so far in 2013, with shares up sharply by 48%.

If you take a look at the chart for CME Group, you'll notice that this stock recently formed a triple bottom chart pattern at $70.42, to $69.88 and $70.28 a share. Following that bottom, shares of CME have now started to trend back above its 50-day moving average of $72.70 a share. That move is quickly pushing CME within range of triggering a major breakout trade.

Traders should now look for long-biased trades in CME if it manages to break out above some near-term overhead resistance levels at $75.50 to $77.65 a share and then once it clears its 52-week high at $79.45 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 1.84 million shares. If that breakout hits soon, then CME will set up to enter new 52-week-high territory above $79.45, which is bullish technical price action. Some possible upside targets off that breakout are $90 to $100 a share.

Traders can look to buy CME off any weakness to anticipate that breakout and simply use a stop that sits right below its 50-day at $72.70 a share or just below more support at $70 a share. One can also buy CME off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Best Gold Companies To Watch In Right Now: 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 Ben Levisohn]
The Market Vectors Gold Miners ETF (GDX) has gained 2.6% to $29.85 today at 10:35 a.m., while Barrick Gold (ABX) has climbed 3.2% to $20.30, Goldcorp (GG) has gained 3% to $30.80 and Newmont Mining (NEM) has risen 1.9% to $32.71. The SPDR Gold Shares ETF (GLD) has ticked up 0.2% today.
[By idahansen]
Due to a breakdown in budget talks in Washington, DC, the exchange traded funds for gold, SPDR Gold Shares (NYSE: GLD), and silver, iShares Silver Trust (NYSE: SLV), both rose. That has certainly not been the trend, however. For 2013, SPDR Gold Shares is off by more than 20%. Over the same period, iShares Silver Trust has dropped by around 30%. It is the same story with major gold companies such as Barrick Gold (NYSE: ABX) and Goldcorp (NYSE: GG).
[By Eric Volkman]
Goldcorp (NYSE: GG ) is continuing to turn its gold into investor cash. The company has declared its latest monthly dividend, which is to be $0.05 per share paid on July 26 to shareholders of record as of July 18. That amount keeps Goldcorp's payout in line with the six preceding monthly payments of 2013. Before that, the company paid $0.045 per share every month for over a year.
[By Jim Powell]
Goldcorp (GG) is a gold mining pure-play that is well-suited for somewhat more aggressive investors who want a tighter focus than GDX offers. The company is the second largest producer after Barrick Gold (ABX) and is considered by many analysts to be the best in its industry.

Top 10 Penny Companies To Buy Right Now: Agnico-Eagle Mines Limited(AEM)

Agnico-Eagle Mines Limited, through its subsidiaries, engages in the exploration, development, and production of mineral properties in Canada, Finland, and Mexico. The company primarily explores for gold, as well as silver, copper, zinc, and lead. Its flagship property includes the LaRonde mine located in the southern portion of the Abitibi volcanic belt, Canada. The company was founded in 1953 and is based in Toronto, Canada.

Advisors' Opinion:

[By Itinerant]
Before we continue, we would like to give references to sources that we used liberally for this article: Brian Christie, VP Investor Relations at Agnico-Eagle (AEM), gave a talk at the Denver Gold Group Luncheon on May 6 in Toronto and the presentation can be viewed here. Andrew J Vigar of Mining Associates gave a keynote at the Mines and Money conference in Hong Kong in March 2013 and the presentation is here. The Visual Capitalist has uploaded a relevant presentation on the topic here. And the Break Away Digger has an interesting piece available here. These documents come with a recommendation for your weekend reading from your humble scribe.

Best Gold Companies To Watch In Right Now: 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]
While many precious-metals companies have been in a slump of late, there is one that belongs perpetually in your portfolio: Silver Wheaton (NYSE: SLW ) . The company is not like other miners -- including Pan American Silver (NASDAQ: PAAS ) and First Majestic (NYSE: AG ) -- in that it has a unique business plan that insulates it against many of the vagaries of the mining business. Moreover, because silver will always have a significant industrial demand component, even with the heightened volatility you see in the silver market, maintaining exposure to silver is appropriate.
[By Doug Ehrman]
It is no secret that precious metals companies have been taking a pounding for some time now. The SPDR Gold Trust (NYSEMKT: GLD ) and iShares Silver Trust (NYSEMKT: SLV ) , the gold and silver ETFs, have been hard hit and operating companies like First Majestic (NYSE: AG ) and Barrick Gold (NYSE: ABX ) have been hit even harder. Through all of these struggles, and in some cases because of them, one precious metals company continues to look attractive for the long term: Silver Wheaton (NYSE: SLW ) .
[By Doug Ehrman]
In terms of individual companies, there are several good choices, but these can behave very differently. Pan American Silver (NASDAQ: PAAS ) , for example, missed revenue expectations and beat earnings expectations in its last earnings release. But despite the beat, EPS shrank considerably from a year earlier on a GAAP basis. The stock has been fairly flat ever since. Conversely, First Majestic (NYSE: AG ) reported strong revenue growth and a small bump in profits, sending the stock higher since the announcement. First Majestic reported increased cash costs and tightening margins, largely driven by lower silver prices. Each of these companies faces pressure from increasing production costs and environmental concerns.

Best Gold Companies To Watch In Right Now: 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.

Best Gold Companies To Watch In Right Now: Australian Dollar(AU)

AngloGold Ashanti Limited primarily engages in the exploration and production of gold. It also produces silver, uranium oxide, and sulfuric acid. The company conducts gold-mining operations in South Africa; continental Africa, including Ghana, Guinea, Mali, Namibia, and Tanzania; Australia; and the Americas, which include Argentina, Brazil, and the United States. It also has mining or exploration operations in the Democratic Republic of the Congo, Guinea, and Colombia. As of December 31, 2010, the company had proved and probable gold reserves of 71.2 million ounces. The company has a strategic alliance with Thani Dubai Mining Limited to explore, develop, and operate mines across the Middle East and parts of North Africa. AngloGold Ashanti Limited, formerly known as Vaal Reefs Exploration and Mining Company Limited, was founded in 1944 and is headquartered in Johannesburg, South Africa.

Advisors' Opinion:

[By Daniel Putnam]
First, and most important, earnings estimates are stabilizing. In the past sixty days, 2013 estimates for the major gold miners have begun to tick up. In most cases, the increase is very modest. For instance, Goldcorp‘s (GG) EPS estimates have climbed from $0.91 to $0.95, while Barrick Gold‘s (ABX) have inched up from $2.57 to $2.64. Newmont Mining (NEM), Anglogold Ashanti (AU), and Gold Fields Ltd. (GFI) have shown similar gains. This positive rate of change marks a significant departure from the steady stream of bad news investors have had to endure in recent years.
[By Sally Jones]
Anglogold Ashanti Limited (AU)
Down 65% over 12 months, Anglogold Ashanti Limited has a market cap of $4.85 billion, and trades with a P/E of 8.10.

Best Gold Companies To Watch In Right Now: NEW GOLD INC.(NGD)

New Gold Inc. engages in the acquisition, exploration, extraction, processing, and reclamation of mineral properties. The company primarily explore for gold, silver, and copper deposits. Its operating properties include the Mesquite gold mine in the United States; the Cerro San Pedro gold-silver mine in Mexico; and the Peak gold-copper mine in Australia. The company also has development projects, including the New Afton gold, silver, and copper project in Canada; and a 30% interest in the El Morro copper-gold project in Chile. The company was formerly known as DRC Resources Corporation and changed its name to New Gold Inc. in June 2005. New Gold Inc. was founded in 1980 and is headquartered in Vancouver, Canada.

Advisors' Opinion:

[By MONEYMORNING]
New Gold Inc. (NSYEMKT: NGD) completed its takeover of Rainy River Resources back in October. New Gold got 4 million ounces in a good jurisdiction (Ontario) and paid less than book value.
[By Ben Levisohn]
One group of stocks not feeling the optimism today: Gold miners. With fewer concerns that a U.S. attack on Syria will be disruptive and more evidence that tapering will begin this month, the price of the precious metal has dropped 1.6% to $1,388.90 an ounce–and gold stocks are falling with it. New Gold (NGD), for one, has dropped 3% to $6.55, while Barrick Gold (ABX) has fallen 1.3% to $19.25.

Best Gold Companies To Watch In Right Now: Iamgold Corporation(IAG)

IAMGOLD Corporation, together with its subsidiaries, engages in the exploration, development, and production of mineral resource properties worldwide. It primarily explores for gold, silver, zinc, copper, niobium, diamonds, and other metals. The company holds interests in eight operating gold mines, a niobium producer, a diamond royalty, and exploration and development projects located in Africa and the Americas. Its advanced exploration and development projects include the Westwood project in Canada; and the Quimsacocha project, which consists of 3 mining concessions covering an aggregate area of approximately 8,030 hectares in Ecuador. The company was formerly known as IAMGOLD International African Mining Gold Corporation and changed its name to IAMGOLD Corporation in June 1997. IAMGOLD Corporation was founded in 1990 and is based in Toronto, Canada.

Advisors' Opinion:

[By Michael Blair]
IAMGOLD (IAG) is one of my favorite gold stocks principally because it is a relatively high cost producer with long lived mines. That paradox arises since high cost producers have the most volatility when gold prices change. If they are operating close to break even, a relatively small rise in gold prices makes them quite profitable. Conversely, when prices fall they bleed all over the floor.
[By Holly LaFon]
He increased his holdings in gold companies in the fourth quarter accordingly. Gold stocks he found attractive in the fourth quarter are: Novagold Resources (NG), Randgold Resources (GOLD), Iamgold Corp. (IAG), Barrick Gold Corp. (ABX), Agnico Eagle (AEM) and International Tower Hill (THM).

Best Gold Companies To Watch In Right Now: Thompson Creek Metals Company Inc.(TC)

Thompson Creek Metals Company Inc., through its subsidiaries, engages in mining, milling, processing, and marketing molybdenum products in the United States and Canada. The company?s principal properties include the Thompson Creek Mine and mill in Idaho; a metallurgical roasting facility in Langeloth, Pennsylvania; and a joint venture interest in the Endako Mine, mill, and roasting facility in British Columbia. It also holds interests in development projects comprising the Davidson molybdenum property and the Berg copper-molybdenum-silver property located in northern British Columbia; the Howard?s Pass property, a lead and zinc project situated in the Yukon territory-northwest territories border; and the Maze Lake property, a gold project located in the Kivalliq district of Nunavut. The company produces molybdenum products, primarily molybdic oxide and ferromolybdenum, as well as soluble technical oxide, pure molybdenum tri-oxide, and high purity molybdenum disulfide. As o f December 31, 2010, its consolidated recoverable proven and probable ore reserves totaled 462.2 million pounds of contained molybdenum in the Thompson Creek Mine and the Endako Mine. The company was formerly known as Blue Pearl Mining Ltd. and changed its name to Thompson Creek Metals Company Inc. in May 2007. Thompson Creek Metals Company Inc. is based in Denver, Colorado.

Advisors' Opinion:

[By Jim Jubak]
The stock market liked what it heard Wednesday, August 7, from Thompson Creek Metals (TC) after the close in New York. Second quarter adjusted net earnings of 8 cents a share crushed the Wall Street consensus of a penny a share. Revenue climbed 3.8% to $117.8 million versus expectations for revenue of just $1.3.8 million. The company also said that its new Mt. Milligan mine is on schedule with a start-up for the concentrator expected this month, with first ore-feed by mid-August. The company said it expects commercial production to begin in the fourth quarter of 2013, with production ramping to full capacity over the next twelve months.
[By Selena Maranjian]
The biggest new holdings are Chesapeake Energy�puts, and shares of Discovery Communications. Other new holdings of interest include Halcon Resources (NYSE: HK ) , and Thompson Creek Metals (NYSE: TC ) . Oil and gas company Halcon, operating in the promising Bakken region, as well as Texas's productive Eagle Ford shale region, among others, is expected to grow by 30% annually over the coming years. It recently reported 2012 net daily production 128% higher than year-ago levels, and proven reserves up 417%. Halcon was recently one of my colleague Joel South's top two energy holdings, and analysts at Stifel recently upped its rating�from Hold to Buy.
[By Jon C. Ogg]
Thompson Creek Metals Co. Inc. (NYSE: TC) was at 54% discount to its book value of $8.30 per share at the time, and the stock price of $3.90 is up from $3.03 Deutsche Bank’s team nailed upside of more than 28% here. Its price target was $4 at the time versus a consensus target of $4.50 at the time. The 52-week range here is $2.42 to $4.55, but we would point out that the consensus price target is $3.93.

Wednesday, March 26, 2014

Darden Restaurants: Breakup Battle Heats Up

The gloves are off. Barington Capital Group, which first proposed restructuring Darden Restaurants (DRI) by working with management, has changed course and asked Darden's independent directors to name an independent chairman and consider hiring a new CEO.

Bloomberg

Barington, which previously reported that it controlled more than 2% of Darden shares, also announced its support of Starboard Value's push to allow shareholders to vote on the company's proposed Red Lobster separation. See the details in this morning's press release.

The news comes in the wake of a number of moves by Darden that could be seen as less than shareholder friendly. Earlier this month the company replaced its investor day meeting with individual meetings with shareholders and analysts. Then last week Darden amended its corporate bylaws. The company's SEC filing said the amendments were made as part of its regular corporate governance review and the bylaws were updated to address current market practices.

The amendments require shareholders proposing director nominations or additional business at a shareholder meeting to hold their shares through the date of the meeting. They also have to make additional disclosures regarding their interest in the company, the business being proposed and/or their relationship with the shareholder nominees. Those being nominated for director must also make additional disclosures.

"As we have said previously, our focus is on doing what is in the best interest of all Darden shareholders and the Board is confident in the actions the Company is taking to deliver on this responsibility," the company said in an email. "We have been speaking directly with our shareholders and look forward to continuing that dialogue."

ISS Corporate Services has given Darden's corporate governance a QuickScore of 10 out of a range of 1 (low governance risk) to 10 (high governance risk). ISS highlights fact that the chairman and CEO roles have not been separated that and that 45% of the non-executive board members have lengthy tenure.

Darden shares rose slightly on the Barington news. They’re up 0.3% to $50.86 at 2:09 p.m. today, as by now it's likely a far gone conclusion that the battle over Darden's future is likely to be heated.

Efficient Management Drives Growth for This Apparel Colossus

Founded in the U.S. in 1981, Guess? Inc. (GES) grew from being a domestic apparel maker to become a global brand. The company designs, markets, distributes and licenses casual and trendy apparel and accessories for the American and European fashion sensibilities. Its target buyer is a style- conscious consumer between the ages of 18 and 32. In fiscal 2013, the company broadened its market by the acquisition of Marciano, an American designer label aimed to costumers between the ages of 25 to 40.

Guess markets its products through a wide brand portfolio and, through six store concepts, the company operates as much as 512 locations in the US and 1,178 internationally, 858 of which are licensees. Its U.S. wholesale customers are large department stores like Macy's Inc. (M), and Bloomingdale's.

Achieving Upturns in Times of Economic Troubles

Over the years GES has developed strong brand recognition and strong adaptability to the changing fashion trends. Consequently, the firm has posted double-digit increases in revenues and profits for the past ten years. A balanced combination of sales enhancement and expansion plans with cuts in operating expenses, has allowed the firm to double its sales and generate returns on invested capital of 24% on average during the last five years.

Nevertheless, GES´ strong performance has been facing several challenges resulting from a tough macroeconomic environment. The company´s international operations account for 50% of its sales, 35% of which are generated in Europe. Hence, economic austerity measures and bad weather conditions in Southern European countries have hurt revenues generated in the region. Reported slowdowns in sales in the US in all four quarters 2013 are also a concern. Moreover, the company´s high exposure to negative foreign currency fluctuations has impacted significantly on its top line growth.

Countering Headwinds

Guess's expansion in Asia, however, rendered impressive results posting double-digit revenues growth over the past few years. Its online business is strong as well and the advertising and marketing of its products through social networks like Tweeter and Facebook have boosted online sales in the last quarters. Its licensing segment also favors the company enormously. In 2013, it contributed with 4% of total sales, which represented a remarkable 37% of operating profits.

Developing economies will remain a priority for Guess's expansion over the next years and the firm is investing heavily in retail stores and the wholesale channel. Central and Eastern Europe (heading Russia and Germany) Latin America and Asia are its main targets. Additionally, it will continue to develop its high- profit-licensing segment and it will also expand its online business to Europe.

At a domestic level, GES' efforts are directed to rising comps. To this aim, the company is enhancing its denim stock and revamping its denim heritage. And most importantly, it is shifting from high -margin products to more affordable clothes, thus appealing a broader audience.

Healthy Balance Sheet and Promising Expansion

The solid management of its business has allowed GES to fund its global expansion mainly with cash generated from its own operations. Hence, the company has a debt free balance sheet and continues to generate strong cash flow from its operations. Its financial flexibility adds to a high return on equity of 16.4, compared to an industry median of 9.1, and a return on capital of 36.90%, compared to its competitors' 19.10%. GES' stocks trade at 15.4 times its trailing earnings, which implies a price discount relative to the industry average. Offering shareholders a good dividend yield of 2.8% is also a compelling argument when looking for a smart purchase. In addition, investment guru Joel Greenblatt (Trades, Portfolio) recently increased his holdings by 987.71%, backing my bullish feeling regarding GES' future growth potential.

Disclosure: Damian Illia holds no position in any stocks mentioned.

About the author:Damian IlliaA fundamental analyst at Lonetreeanalytics.com constantly looking for value and income investments.

Visit Damian Illia's Website

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Tuesday, March 25, 2014

Bankruptcy Filings Give Quiznos, Sbarro Chances to Change

Quiznos Sandwich Shop Prepares For Bankruptcy Filing Justin Sullivan/Getty Images March hasn't been a good month for the quick-service industry. Sbarro -- the pizza and pasta chain that's a staple in many malls -- filed for Chapter 11 bankruptcy reorganization earlier this month. A few days later it was toasted-sandwich maker Quiznos following suit. This doesn't mean that you'll never have another slice of Sbarro's New York-style pizza or a French dip sub at Quiznos. Unlike Chapter 7 bankruptcy, where cash-strapped companies wind down their operations, Chapter 11 gives companies another chance to get it right after negotiating with creditors. It's not a good place to be -- and this is the second time Sbarro has gone this route in the past three years. However, things have to be pretty bad if you're willing to risk upsetting creditors and potentially hand over ownership in the pursuit of a cleaner balance sheet. Sbarro and Quiznos hope that a fiscal makeover will turn the tide. Sbarro will surrender ownership to lenders in a move that will replace 80 percent of its debt with equity. Quiznos filed a prepackaged restructuring plan that would shave $400 million of debt. Both chains will live on, but they may not be the same. Mauled at the Mall Sbarro has shut 180 company-owned locations with plans to shutter dozens more. There are now less than 800 units. Quiznos has 2,100 largely franchisee-owned locations, but we'll have to see how that holds up over time. Sbarro cited an "unprecedented decline in mall traffic" as a factor in its slide. As shoppers migrate online, there has been slower foot traffic at the suburban mall and hence to the food court. Quiznos relies on standalone locations and strip-mall outlets that haven't necessarily suffered from the thinning shopping mall crowds that have hurt Sbarro. However, Quiznos has been hit by everything from the larger Subway following it into toasted subs to folks scaling back on carbohydrates. It didn't seem as if this was a problem last year. Two of the hottest IPOs out of the gate last year -- Potbelly (PBPB) and Noodles & Co. (NDLS) -- were companies where their specialties feature the same high carbs that are supposedly tripping up Sbarro and Quiznos. Potbelly's star attraction is its line of toasted subs just like Quiznos, and Noodles naturally boils up pasta -- something that Sbarro's has always done and Quiznos started doing last month with toasted pasta. All four companies are competing in the fast casual niche that's supposedly thriving as customers trade up from fast food establishments without having to take the time for longer meals at casual dining chains. However, things aren't so rosy in fast casual these days. Potbelly and Noodles & Co., after posting uninspiring financial results, are now trading far lower than their initial euphoric highs. Quiznos and Sbarro may have seen their finances hit the breaking point -- forcing bankruptcy reorganization -- but they may not be alone.

Monday, March 24, 2014

Credit Suisse Picked a Bad Day to Up Its Prices Targets on Barrick Gold, Newmont Mining

Compared to other gold miners, Barrick Gold (ABX) and Newmont Mining (NEM) haven’t gotten much love from investors this year.

Associated Press

Shares of Newmont Mining have gained 3.2% so far this year, while Barrick Gold has risen 4.8%, even as the SPDR Gold ETF (GLD) has gone up 8.6% and the Market Vectors Gold Miners ETF (GDX) has advanced 16%.

Credit Suisse analysts Anita Soni and Robert Reynolds still rate Newmont Mining and Barrick Gold shares Neutral, but turned more positive on the companies’ share prices today. They explain why they raised their price target on Barrick Gold…

Our ]target price] increases to US$21 as we raise our [net-asset value] multiple to 1.60x (from 1.20x) to reflect [Barrick Gold's] relatively conservative $1,100/oz gold price assumption for reserves, exploration upside potential within its asset base (demonstrated by its 15Moz Goldrush discovery) and strong base of low cost assets. Our [Operating Cash Flow] is reduced for FY15 to $1.17/sh (from $1.58/sh) as we model higher sustaining capex and corporate spending than previously.

…and on Newmont Mining:

Our [Newmont Mining] TP increases to US$26 (from US$21) on higher forecast OpCFa and a higher NAV target multiple. Our OpCFa for FY14/15 on average increased to $1.80 (from $1.40) onhigher production and lower costs in 2015 than our prior forecast, now reflecting guidance. Our NAV declined to $14.83/sh (from $18.92/sh), primarily on Nevada (less reserves and higher CS cost est.) and Ahafo (higher CS cost est.). Our target NAV multiple is raised to 1.50x, at a slight discount to peer [Barrick Gold] (1.60x).

A resolution of the ore export ban in Indonesia is necessary to become more constructive on [Newmont Mining], as the strong 2015/2016 FCF would provide [Newmont Mining] with additional balance sheet flexibility to pursue value accretive project development, or external M&A. [Newmont Mining] benefits from a long life asset base in Nevada and Ghana.

Gold and gold miners are plunging today, however, so shares of Newmont Mining have fallen 3.1% to $23.79 at 11: 37 a.m. today, while Barrick Gold has fallen 4.9% to $18.45. The Market Vectors Gold Miners ETF has declined 4.4% to $24.40 and the SPDR Gold ETF is off 1.8% to $126.21.

Sunday, March 23, 2014

Mid-Morning Market Update: Markets Mixed; Ann To Lower Around 100 Jobs

Related BZSUM #PreMarket Primer: Friday, March 14: Ukraine Prepares For Armed Combat Market Wrap For March 13: Bears Come Out Of Hibernation As Dow Suffers Largest Daily Loss Since February 3

Following the market opening Friday, the Dow traded up 0.14 percent to 16,130.63 while the NASDAQ tumbled 0.13 percent to 4,254.90. The S&P also rose, gaining 0.06 percent to 1,847.50.

Leading and Lagging Sectors
Utilities stocks gained Friday, with Korea Electric Power (NYSE: KEP) leading advancers. Meanwhile, gainers in the sector included Huaneng Power International (NYSE: HNP), with shares up 1.8 percent, and Hawaiian Electric Industries (NYSE: HE), with shares up 1.4 percent.

Telecommunications services sector was the leading decliner in the US market today. Top decliners in the sector included Internet Initiative Japan (NASDAQ: IIJI), off 3.7 percent, and BT Group plc (NYSE: BT), down around 2.7 percent.

Top Headline
Ann (NYSE: ANN) reported a rise in its fourth-quarter earnings and issued a downbeat forecast for the year. The company also announced its plans to lower about 100 jobs. Ann's quarterly earnings surged to $4.7 million, or $0.10 per share, from $2.4 million, or $0.05 per share, in the year-ago period. Its revenue climbed 3% to $623.3 million versus $607.7 million. However, analysts were estimating earnings of $0.07 per share on revenue of $624 million.

Equities Trading UP
Ulta Salon, Cosmetics & Fragrance (NASDAQ: ULTA) shares shot up 7.17 percent to $95.93 after the company reported better-than-expected fourth-quarter earnings. Ulta Salon posted its quarterly earnings of $1.09 per share, beating analysts' estimates of $1.07 per share.

Shares of Ebix (NASDAQ: EBIX) got a boost, shooting up 4.42 percent to $17.00 after the company reported better-than-expected Q4 earnings.

Liberty Media (NASDAQ: LMCA) was also up, gaining 8.56 percent to $136.94 after the company dropped its bid to buy SiriusXM (NASDAQ: SIRI). The company will reclassify common stock to create two groups.

Equities Trading DOWN
Shares of Aeropostale (NYSE: ARO) were down 14.66 percent to $6.23 after the company posted a wider-than-expected fourth-quarter loss and signed a deal with Sycamore Partners for a 5% stake. The company issued weak forecast for the first quarter and also announced its plans to close 50 Aeropostale stores and 2 P.S. stores.

Dyax (NASDAQ: DYAX) shares tumbled 10.39 percent to $9.10 after the company priced 8 million shares at $9.25 per share.

Raptor Pharmaceuticals (NASDAQ: RPTP) was down, falling 10.04 percent to $13.31 after the company reported Q4 results. Raptor Pharmaceutical posted a Q4 loss of $0.20 per share, versus the projected loss of $0.16 per share.

Commodities
In commodity news, oil traded up 0.62 percent to $98.81, while gold traded up 0.97 percent to $1,385.70.

Silver traded up 2.65 percent Friday to $21.76, while copper rose 1.15 percent to $2.96.

Eurozone
European shares were lower today.

The Spanish Ibex Index fell 1.87 percent, while Italy's FTSE MIB Index declined 1.65 percent.

Meanwhile, the German DAX dropped 0.52 percent and the French CAC 40 declined 1.30 percent while U.K. shares fell 0.54 percent.

Economics
US wholesale prices declined 0.1% in February, while core wholesale prices increased 0.1% in the month. However, economists were expecting a 0.2% gain in wholesale prices.

The preliminary reading of the Reuter's/University of Michigan's consumer sentiment index fell to 79.90 in March, versus a prior reading of 81.60. However, economists were expecting a reading of 82.00.

Posted-In: Earnings News Guidance Eurozone Futures Forex Global Econ #s Economics Intraday Update Markets Movers Tech

Most Popular Groupon, Zynga Buck Social Media Short Interest (GRPN, LNKD, ZNGA) iOS 8 Apple Maps To Take On Google Maps Why The iPhone 6 Isn't A Big Deal No Day Is Leg Day: Coca-Cola And The 'New Coke' Fiasco Benzinga's Top #PreMarket Gainers Market Wrap For March 13: Bears Come Out Of Hibernation As Dow Suffers Largest Daily Loss Since February 3 Related Articles (ANN + ARO) Mid-Morning Market Update: Markets Mixed; Ann To Lower Around 100 Jobs Morning Losers for Friday, March 14, 2014 UPDATE: Morgan Stanley Reiterates on Aeropostale as Cash Burn Accelerates UPDATE: Ann Posts Rise In Q4 Earnings, Plans To Lower 100 Jobs

Saturday, March 22, 2014

Tiffany stock hit by 4Q loss

The famous Tiffany luster lost some sparkle on Friday as its stock got hammered by a fourth quarter loss.

The stock swooned 2.1% in pre-market trading to $89.30, after the chi-chi jewelry retailer said its fiscal fourth quarter was hit by a sizable charge linked to an unfavorable arbitration ruling. Unlike many retailers, however, Tiffany's sales actually improved during the tough holiday shopping season.

Even without the charge, its adjusted earnings missed Wall Street expectations. Its forecast for this year also was short of expectations. For the three months ended Jan. 31, the luxury jewelry company — known for its little blue boxes — lost $103.6 million, or 81 cents per share. A year earlier it earned $179.6 million, or $1.40 per share.

But CEO Michael J. Kowalski was bullish about 2015 -- and unapologetic about 2014's fiscal fourth quarter. "We are proud of our performance this past year," he said, in a statement. "Sales and operating earnings -- excluding the arbitration-related charge -- rose to record levels."

Removing the charge of $2.27 per share for the unfavorable arbitration ruling, earnings were $1.47 per share. Analysts surveyed by FactSet expected higher earnings of $1.51 per share. Back in Dec, 2013, a Dutch arbitration panel ruled that Tiffany had to pay Swatch $449.5 million plus interest, in a case stemming from a failed joint watch venture between the two companies.

In the bigger picture, Tiffany enjoyed a fairly impressive fourth quarter at a time many domestic retailers in all sectors were hurt by the one-two punch of lousy weather and stingy shopper sentiment. Sales at stores open at least a year, a key gauge of a retailer's health, rose 6% due to higher sales in all regions. This metric excludes results from stores recently opened or closed.

At the same time, revenue climbed 5% to $1.3 billion from $1.24 billion, led by strong sales of fine and statement jewelry as well as jewelry collections. That matched Wall Street's expectations.

Sales increased in the Americas, Asia Pacific and Europe. Sales declined in Japan due to the weaker yen, but climbed on a constant exchange rate basis.

Tiffany also announced that its board approved the repurchase of up to $300 million of its common stock. The company's prior repurchase program expired at the end of January. The new buyback will expire on March 31, 2017.

Full-year net income declined 56 percent to $181.4 million, or $1.41 per share, from $416.2 million, or $3.25 per share, in the previous year. Adjusted earnings were $3.73 per share.

Annual revenue increased 6 percent to $4.03 billion from $3.79 billion.

For fiscal 2014, the New York company anticipates earnings between $4.05 and $4.15 per share. Analysts predict $4.27 per share. The retailer foresees full-year worldwide sales rising by a high single-digit percentage rate on strength across all regions.

Tiffany has more than 200 sales worldwide. Kowalski said the chain plans to add 13 company-operated stores -- and close four existing stores -- over the next year.

Contributing: Associated Press

Friday, March 21, 2014

401(k) fiduciary lawsuit raises questions on record keeping

401(k), fees, schlichter, lawsuit, record keeping, float

An appellate court's decision this week in a 401(k) fiduciary duty lawsuit is raising questions among legal experts in the retirement plan industry about float income and who it belongs to.

On Wednesday, the 8th U.S. Circuit Court of Appeals backed a lower court's decision that found that ABB Inc. had breached its fiduciary duty to its workers when it failed to monitor its plan record-keeping costs, failed to calculate the amount the plan paid through revenue sharing and failed to determine whether the pricing was competitive.

The court also upheld the lower court's judgment for an award of $13.4 million against ABB with respect to the record keeping.

“This decision is a victory not just for ABB employees, but for all 401(k) employees and retirees,” said Jerome Schlichter, the attorney representing the plan participants in the suit. “That's because it states that plan sponsors have a strict duty to monitor record-keeping costs and make sure they're reasonable.”

The court, however, also reversed the lower court's ruling on other issues, clearing plan record keepers Fidelity Management Trust Co. and Fidelity Management and Research Co. of a breach of fiduciary duty.

The case, Ronald C. Tussey v. ABB Inc., is a landmark suit for the retirement plan industry.

In their initial suit, filed in the U.S. District Court for the Western District of Missouri in Jefferson City in 2006, the participants claimed that the retirement plan was entitled to float income that was generated when plan contributions were made and held briefly in a depository account before being invested. The lower court sided with the participants, but the appellate court subsequently reversed the decision.

Though the appellate court took a strong stance this week confirming the duty of the plan sponsor and fiduciaries to track their record-keeping fees and ensure they are reasonable, it left some ambiguity with respect to how it views float income.

“They said the float belongs to the investment options [in the plan],” said Marcia Wagner, managing director of The Wagner Law Group. “If the plan invests in the investment option, then it is a plan asset.”

“This has created more uncertainty,” she added.

Circuit Court Judge Kermit Edward Bye dissented.

“Unlike the majority, I would conclude that float is a plan asset under these circumstances and Fidelity therefore breached its fiduciary duty of loyalty by transferring float to the depository account for the benefit of investment options and by using float income to pay for bank expenses,” he wrote.

The case raises another interesting issue with respe! ct to float: Whose dollars are generating float income?

In the decision, the judges agreed with Fidelity that when an exiting participant chooses to accept a check, the “funder of the check owns the funds in the checking account until the check is presented and this is entitled to any interest earned on the float.” However, the participants contest the ownership of the funds, claiming that the owner is the plan — and making float income a plan asset.

Expect to see this issue get more attention with respect to participants leaving plans, noted C. Frederick Reish, a partner in the employee benefits and executive compensation practice group at Drinker Biddle Reath.

Record keepers will say that if a participant leaves the plan, then his or her investment is liquidated and turned into cash. That cash is then held into an account, from which the record keeper will write the check.

“The issue with float is: Where did the money that earned the float come from?” said Mr. Reish. “I can see where the dissenting judge may have an argument in the sense that if the money is in the plan, then the plan owns the asset.”

“But is it proper for the record keeper to move the money out of the plan and into a checking account?” he asked. “This is a common practice by record keepers, and that's the remaining issue.”

Vincent Loporchio, a spokesman for Fidelity, said the firm was “pleased” with the appellate court's decision.

Calls to ABB spokesman Barry Dillon were not returned.

Thursday, March 20, 2014

3 Stocks Breaking Out on Big Volume

DELAFIELD, Wis. (Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

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Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

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With that in mind, let's take a look at several stocks rising on unusual volume recently.

TD Ameritrade

TD Ameritrade (AMTD) provides securities brokerage services and technology-based financial services to retail investors, traders and independent registered investment advisors in the U.S. This stock closed up 1.8% to $34.44 in Wednesday's trading session.

Wednesday's Volume: 5.06 million

Three-Month Average Volume: 2.65 million

Volume % Change: 72%

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From a technical perspective, AMTD trended modestly higher here right above its 50-day moving average of $32.50 with above-average volume. This stock has been uptrending for the last month and change, with shares moving higher from its low of $29.78 to its recent high of $34.99. During that uptrend, shares of AMTD have been consistently making higher lows and higher highs, which is bullish technical price action. This spike higher on Wednesday is quickly pushing shares of AMTD within range of triggering a major breakout trade. That trade will hit if AMTD manages to take out some near-term overhead resistance levels at $34.99 to its 52-week high at $35.16 with high volume.

Traders should now look for long-biased trades in AMTD as long as it's trending above its 50-day at $32.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 2.65 million shares. If that breakout gets underway soon, then AMTD will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $40 to $45.

Ritchie Bros. Auctioneers

Ritchie Bros Auctioneers (RBA) sells industrial equipment and other assets for the construction, agricultural, transportation, energy, mining, forestry, material handling, marine and real estate industries through its unreserved auctions and online marketplaces. This stock closed up 1.6% at $23.51 in Wednesday's trading session.

Wednesday's Volume: 1.11 million

Three-Month Average Volume: 516,733

Volume % Change: 125%

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From a technical perspective, RBA trended modestly higher here right above its 50-day moving average of $22.75 with above-average volume. This stock recently formed a double bottom chart pattern at $21.88 to $21.98. Since forming that bottom, shares of RBA have spiked higher back above its 50-day moving average of $22.75 with strong upside volume flows. That spike is quickly pushing shares of RBA within range of triggering a big breakout trade. That trade will hit if RBA manages to take out its 52-week high at $23.89 with high volume.

Traders should now look for long-biased trades in RBA as long as it's trending above its 50-day at $22.75 and then once it sustains a move or close above $23.89 with volume that's near or above 516,733 shares. If that breakout materializes soon, then RBA will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $30 to $33.

Vera Bradley

Vera Bradley (VRA), designs, produces, markets and retails accessories for women. This stock closed up 7.4% to $28.20 in Wednesday's trading session.

Wednesday's Volume: 3.67 million

Three-Month Average Volume: 439,150

Volume % Change: 714%

From a technical perspective, VRA ripped sharply higher here right above its 50-day moving average of $25.33 with monster upside volume. This move briefly pushed shares of VRA into breakout and new 52-week-high territory, after the stock flirted with some near-term overhead resistance at $28.60. Shares of VRA closed just below that level at $28.20 but well off its intraday low of $25.61. Market players should now look for a continuation move higher in the short-term if VRA manages to take out Wednesday's high of $28.77 with strong volume.

Traders should now look for long-biased trades in VRA as long as it's trending above $27 and then once it sustains a move or close above $28.77 with volume that hits near or above 439,150 shares. If we get that move soon, then VRA will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $35 to $50.

To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.