Hot Stocks To Buy For 2014: February 2014

Sunday, February 23, 2014

Tax savings give IRAs, 401(k)s an edge

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

Q: Do you have to use retirement accounts to save for retirement?

A: IRA. 401(k). Roth. These are the types of retirement accounts many beginning investors know are important, but may not completely understand.

The fact is, no, you don't need to use any of these retirement accounts to save for retirement. It's just these special accounts make it a whole lot easier to accumulate a nest egg if you take the time to understand what they are.

The standard brokerage account, technically, would work fine for people looking to save for retirement. And traditional brokerage accounts have their benefit in that you can take the money out whenever you want and for whatever reason without paying a penalty.

TRACK YOUR STOCKS: Get real-time quotes with our free Portfolio Tracker

But standard brokerage accounts are taxable for most people. That means every dividend and every capital gain is a taxable event, which means more money for Uncle Sam and less for you in retirement.

Retirement accounts are intended to give people a break when saving for retirement. Depending on the type of account, there can be enormous tax benefits to using these accounts.

Roth IRAs, for instance, allow you to contribute already-taxed money and allow it to compound for decades and withdraw tax free.

Retirement accounts have their downsides, including fees for taking out money for non-retirement purposes, but they're still absolutely worth the risk.

Friday, February 21, 2014

Hot Low Price Companies To Invest In Right Now

WireImage/Getty Images From a poorly planned food drive to "mislabeled" bibles to a run on recliners, here's a rundown of the week's best and worst moves in the business world. La-Z-Boy (LZB) -- Winner It's not easy to get pumped about a maker of reclining furniture, but that's just what happened this week when La-Z-Boy posted better than expected quarterly results. Sales rose 14 percent for the quarter, and the furniture maker's profit of $0.31 a share was well ahead of what Wall Street was forecasting. La-Z-Boy also sweetened its own story by boosting its quarterly dividend by 50 percent. Something tells me that bigger dividends sound better to folks than the comfy chair. Walmart (WMT) -- Loser A Walmart store in Ohio made headlines for all the wrong reasons when it set up a food drive to benefit its own impoverished employees. Walmart is already taking plenty of heat for its low wages, even though it's not materially different than what many retailers pay. It never gets the accolades for making budgets last longer by offering low prices. However, this time the knocks are warranted. Setting up tables in the employees' area for sales associates and cashiers to donate food items for their poor coworkers was never going to end well. Walmart initially played it up as a positive, suggesting that it was collecting for Walmart employees whose spouses are out of work. However, the more straightforward interpretation is that Walmart doesn't pay a living wage sufficient to provide for a family, and that's the one that went viral. SodaStream (SODA) -- Winner Making soda at home just got easier with SodaStream introducing SodaStream Caps. Simply pressing a SodaStream Caps capsule down into a fizzed up SodaStream bottle provides enough syrup for the entire liter. It's a slightly more convenient process than having to pour out the syrup from a bottle's measuring cap. SodaStream Caps are now being sold exclusively through Bed Bath & Beyond (BBBY), though other retailers will begin stocking the portion packs starting next year. Starting at $5 for a eight capsule cola or diet cola pack, it's not cheaper than the existing bottles, but it should be enough to win over those who haven't been as neat with their syrup pours in the past. Costco (COST) -- Loser You rarely see this warehouse club giant mess up, but it did this week. A pastor visiting a Costco in California was surprised to see a bible labeled as "fiction" in the store's book department. His post on Twitter went viral. Was this an agnostic employee with a mean streak and a label gun? No. Costco laid the blame on a distributor for making the mistake on a small number of bibles. It naturally relabeled the bibles, but it was still embarrassing for a company that has typically earned nothing but praise for its high wages and its decision to remain closed on Thanksgiving. Green Mountain Coffee Roasters (GMCR) -- Winner The death of Green Mountain's K-Cups at the hands of rival private-label coffee pods appears to have been greatly exaggerated. Shares of the company behind the Keurig single-serve coffee brewers rose after posting blowout quarterly results. Green Mountain saw revenue as well as sales of its K-Cups and brewers all climb at double-digit percentage rates. Green Mountain did offer a gloomy outlook for its holiday quarter, but investors brushed that aside after the company initiated a quarterly dividend and authorized an additional $1 billion share buyback plan. Green Mountain will still need to tackle its slowdown in the current quarter, but at least it's returning money to its shareholders to reward their patience.

Hot Low Price Companies To Invest In Right Now: Latrobe Magnesium Ltd (LMG.AX)

Latrobe Magnesium Limited focuses on the production of magnesium metal through the combined hydromet/thermal reduction process in Australia. The company primarily holds interests in the Latrobe Magnesium project located in the Latrobe Valley, Victoria. It intends to harvest magnesium metal from industrial fly ash, which is a waste product of brown coal power generation. The company was formerly known as Rambora Technologies Limited and changed its name to Latrobe Magnesium Limited in September 2002. Latrobe Magnesium Limited is based in Sydney, Australia.

Hot Low Price Companies To Invest In Right Now: Koninklijke Philips Electronics N.V.(PHG)

Koninklijke Philips Electronics N.V. engages in the healthcare, consumer lifestyle, and lighting product businesses worldwide. The company offers screening, diagnosis, treatment, monitoring, and health management services in cardio-pulmonary, oncology, and women?s health areas. Its healthcare products and solutions include X-rays, computed tomography, magnetic resonance, nuclear medicine, and ultrasound imaging equipment; and cardiology informatics and diagnostic electrocardiography, radiology information systems, picture archiving and communication systems, patient monitoring and clinical informatics, perinatal care, and therapeutic care systems. The company?s healthcare products and solutions also consist of sleep management and respiratory care, medical alert, remote cardiac, and remote patient management services. In addition, it offers consultancy, site planning and project management, clinical, education, equipment financing, asset management, and equipment mainten ance and repair services. The company?s consumer lifestyle products and solutions comprise mother and childcare, oral healthcare, male grooming, skincare, and beauty products; coffee, floor and garment care, kitchen, water and air, and beverage appliances; and communication and control, audio and multimedia, speech processing, headphones and accessories, and home cinema and video products. Its lighting solutions include lamps, including incandescent, halogens, fluorescent, high-intensity discharge, and LED lamps; consumer luminaires for functional, decorative, lifestyle, and scene-setting applications; professional luminaires for city beautification, and road, sports, shop/hospitality, and industry lighting applications; systems and controls, that include electronic and electromagnetic gears, controls, modules, and drivers; automotive lighting, such as car headlights, car signaling, and interior; and packaged LEDs. The company was founded in 1891 and is headquartered in Ams terdam, the Netherlands.

Advisors' Opinion:

[By Ben Levisohn]
Shares of GE have gained 3.5% to $24.54 at 1:08 p.m. today. United Technologies (UTX) has dropped 0.6% to $107.37, Koninklijke Philips (PHG) has gained 0.8% to $33.40, Siemens (SI) has risen 1.5% to $124.40 and 3M (MMM) has ticked up 0.1% to $122.75.
[By Steve Symington]
Enter Dolby 3D
That's why I'm so intrigued by Monday's news that Dolby (NYSE: DLB ) and Philips (NYSE: PHG ) have collaborated in a joint project to create a new content delivery specification for the Dolby 3D format, which will be part of a "suite of technologies" to more easily allow content creators the ability to make, deliver, and play back glasses-free 3-D content.

10 Best Small Cap Stocks To Buy Right Now: Verso Paper Corp.(VRS)

Verso Paper Corp. engages in the production and sale of coated papers in the United States. The company offers coated groundwood paper, which is used primarily for catalogs and magazines; coated freesheet paper that is used primarily for annual reports, brochures, and magazine covers; and supercalendered paper, which is primarily used for retail inserts. It also provides northern bleached hardwood kraft pulp that is used to manufacture printing and writing paper grades, and tissue products; recycled paper to meet specific customer requirements; and customized product solutions by producing paper grades with customer-specified weight, brightness, and pulp mix characteristics. In addition, the company offers ultra-lightweight uncoated printing papers, and ultra-lightweight coated and uncoated flexible packaging papers. It serves catalog, magazine, insert, and commercial printing markets through direct sales, commercial printers, paper merchants, and brokers. The company was founded in 2006 and is headquartered in Memphis, Tennessee.

Hot Low Price Companies To Invest In Right Now: Opmedic Group Inc Com Npv (OMG.TO)

OPMEDIC Group Inc. provides healthcare related services primarily in Canada. It offers professional fertility services; laboratory and genetic services; diagnostic laboratory services, primarily prenatal screening; cytogenic tests designed to improve healthcare as an aid to prenatal screening and can be performed on peripheral blood, amniotic fluid, and bone marrow; and other cytology and genetic testing. The company also provides surgical and endoscopic services, such as general surgery, otorhinolaryngology, gynecology, urology, digestive endoscopy, and plastic and cosmetic surgery; and facilities for patients and surgeons. In addition, it offers sperm banking services. The company was formerly known as Repro Clinics Inc. and changed its name to OPMEDIC Group Inc. in October 2005. OPMEDIC Group Inc. was founded in 2001 and is headquartered in Mount-Royal, Canada.

Hot Low Price Companies To Invest In Right Now: Green Plains Renewable Energy Inc. (GPRE)

Green Plains Renewable Energy, Inc. engages in the production, marketing, and distribution of ethanol and related distillers grains in the United States. It also involves in grain warehousing and marketing; selling and servicing agronomy and petroleum products; the production and sale of corn oil; and the marketing and distribution of company-produced and third-party ethanol and distillers grains. The company was founded in 2006 and is headquartered in Omaha, Nebraska.

Advisors' Opinion:

[By Nickey Friedman]
Other biofuel companies
Unlike KiOR, Renewable Energy Group (NASDAQ: REGI ) and Green Plains Renewable Energy (NASDAQ: GPRE ) are ending the year with stock prices at more than double where they started it due to their excellent operational performance. For example, last quarter Renewable Energy Group reported revenue leaped 42% to $458.4 million. Net income had a dramatic turnaround, from a loss of $6.9 million to positive $78.5 million or $2.31 per share, though $42.1 million of that was an IRS tax benefit. Analysts expect Renewable Energy Group to report positive EPS of $1.66 next year while KiOR is expected to lose nearly a buck per share.
[By Tristan R. Brown]
Three months ago I wrote that the stock performance YTD of independent ethanol producer Pacific Ethanol (PEIX) was an "aberration", especially in light of the performance of its industry peers' shares. The discrepancy between Pacific Ethanol's share price and those of its peers has only grown more pronounced since July (see figure). Green Plains Renewable Energy (GPRE) and REX American Resources (REX) have continued to greatly outperform the S&P 500. Even Biofuel Energy, which fell behind on its interest and debt payments over the summer and is facing a shareholder-ruining liquidation, has seen its share price perform significantly better than Pacific Ethanol's in 2013. The oddest part about the stock's performance over the last three months, however, is that the period has been marked by multiple positive announcements from the company. It late July it reported its first positive EPS in almost two years for Q2 (0.07). Its Q2 EBITDA of $3.8 million was its highest since Q4 2011. Its current ratio is well above its previous lows, its ratio of total assets to total liabilities is increasing, and its total shareholders' equity is at a 3-year high. Despite these improvements, the company's price/book ratio is a mere 0.77.

Hot Low Price Companies To Invest In Right Now: Ted Baker PLC (TED)

Ted Baker PLC is engaged in the designing, wholesaling and retailing of menswear, womenswear and related accessories. The Company offers a range of collections including menswear; womenswear; global; phormal; endurance; born by ted baker; accessories; lingerie and sleepwear; childrenswear; fragrance and skinwear; footwear; neckwear; eyewear, and watches. The Company operates in three segments: retail, wholesale and licensing income. In retail segment it operates stores and concessions across the United Kingdom, Europe, the United Sates and Hong Kong, and an e-commerce business. In wholesale segment operates a wholesale business in the United Kingdom serving countries across Europe and a wholesale business in the United Sates. In licensing income segment it operates both territorial and product licences.

Hot Low Price Companies To Invest In Right Now: Nuveen Insured California Select Tax-Free Income Portfolio(NXC)

Nuveen California Select Tax-Free Income Portfolio is a closed-ended fixed income mutual fund launched by Nuveen Investments Inc. It is managed by Nuveen Asset Management. The fund invests in the fixed income markets of United States. It invests in the securities of companies that operate across diversified sectors. The fund primarily invests in municipal bonds. It employs fundamental analysis to create its portfolio. The fund benchmarks the performance of its portfolio against Barclays Capital California Municipal Bond Index and S&P California Municipal Bond Index. Nuveen California Select Tax-Free Income Portfolio was formed on June 19, 1992 and is domiciled in the United States.

Hot Low Price Companies To Invest In Right Now: (VXR.AX)

Venturex Resources Limited engages in the identification, acquisition, and development of base metal and gold properties in Australia and Brazil. Its principal property includes the Whim Creek VMS project covering copper, zinc, lead, silver, and gold deposits located in the Pilbara region of Western Australia. The company was formerly known as Jutt Holdings Limited and changed its name to Venturex Resources Limited in January 2009. Venturex Resources Limited was incorporated in 2006 and is based in West Leederville, Australia.

Hot Low Price Companies To Invest In Right Now: Pluristem Therapeutics Inc.(PSTI)

Pluristem Therapeutics Inc., a bio-therapeutic company, engages in the research, development, and commercialization of standardized cell therapy products for the treatment of life threatening diseases. The company?s products are derived from human placenta, a non-controversial, non-embryonic, adult cell source. Its Placental adherent stromal cells are grown in the company's proprietary PluriX three-dimensional process that allows cells to grow in a natural environment. The company provides PLX-PAD that has completed Phase I clinical trials for people suffering from peripheral artery disease. It also offers various product candidates for diabetic foot ulcers, adjuvant hip replacement surgery, athletic injuries, inflammatory bowel disease, multiple sclerosis, neuropathic pain, ischemic stroke, adjuvant for UCB transplantation, and radiation exposure. The company was formerly known as Pluristem Life Systems Inc. and changed its name to Pluristem Therapeutics Inc. in November 2007. Pluristem Therapeutics Inc. was founded in 2001 and is headquartered in Haifa, Israel.

Advisors' Opinion:

[By John Udovich]
Stem cell stocks have not exactly been the best performers lately in part because the controversy over their use has died down over the years while major breakthroughs have been few or far between, but the industry along with small cap stem cell stocks Pluristem Therapeutics Inc (NASDAQ: PSTI), BioTime, Inc (NYSEMKT: BTX) and BioRestorative Therapies (OTCBB: BRTX) are still quietly producing their share of news or minor breakthroughs worth taking note of. Just consider the following stem cell news or news from small cap players in the sector:
[By James E. Brumley]
Traders may not want to get married for the long haul to any of them, but for speculators looking for a quick, profitable hit, Arca Biopharma Inc. (NASDAQ:ABIO), Pluristem Therapeutics Inc. (NASDAQ:PSTI), and Bacterin International Holdings Inc. (NYSEMKT:BONE) may be better-than-average bets. Here's why.

Tuesday, February 18, 2014

BBRY: Daniel Loeb Isn’t Your Beacon of Hope

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BlackBerry (BBRY) has been a value trap that has ensnared more than its share of value hunting investors in recent years — yours truly included. Buying BlackBerry stock will also likely go down in history as the single-worst investing mistake in the otherwise illustrious career of Prem Watsa — the chairman of Fairfax Financial (FRFHF) and the man commonly known as the "Warren Buffett of Canada."

Blackberry 185 BBRY: Daniel Loeb Isn't Your Beacon of Hope Attempting to call the bottom in BlackBerry stock — and ultimately getting burned — appears to be something of a rite of passage.

Now, it's Daniel Loeb's turn.

Loeb's Third Point Capital bought 10 million shares of BBRY stock last quarter, making him BlackBerry's fourth-largest institutional holder.

I should start by saying that Daniel Loeb is no dummy. Although Carl Icahn was more vocal about it, Loeb was the first big-name hedge fund manager to take the opposite side of Bill Ackman's poorly conceived short sale of Herbalife (HLF). Over the past 15 years, he has crushed the S&P 500 by more than 12 percentage points annually.

He's also in good company. Although Watsa is the highest-profile BlackBerry bull, last quarter saw funds managed by Joel Greenblatt, Jim Simons, and Mario Gabelli all initiate new positions in BBRY stock.

So, what's the story here? Did BlackBerry finally get so cheap that it was worth the risk?

Maybe. Even after the surge it has had thus far in 2014, BBRY stock still trades hands for just 0.57 times sales. And according to CEO John Chen, BBRY should be cash-flow positive by the end of this year and officially profitable by the end of the first quarter of 2016.

On paper, BlackBerry stock trades for 1.2 times its accounting book value. But bulls have long argued that BlackBerry's real estate and patent portfolio are vastly understated and that the company could be profitably stripped down and sold for spare parts. I conceded as much in an article last month in which I discussed BBRY stock as a potential asset play.

Still, I'm not buying.

Loeb has a well-deserved reputation as an activist investor that wrings unrealized value out of underperforming companies. But I see BBRY as being too broken for even Daniel Loeb to fix. BlackBerry's handset business is long past the point of no return. Shipments fell 41% last year — a year in which their competitors collectively saw sales rise by 39% — and BlackBerry's global market share is now barely one half of 1%.

The most damning indictment of all? BlackBerry's new high-end phones are even losing market share to in-house rivals; sales of older BlackBerry 7 phones grew to overtake those of BlackBerry 10 phones toward the end of last year.

I know, I know. BBRY is looking past handsets to focus on its future as a software and enterprise services company. I get that. And it sounds good.

There is just one massive problem with it: Virtually all of BlackBerry’s current revenue stream comes from handsets. About 40% of revenues comes from handset sales and 53% comes from services — but most of that are fees that users and carriers pay to access BlackBerry's network … with BlackBerry handsets. If handsets disappear, so do most of BlackBerry's revenues.

In other words, BlackBerry can't afford to continue selling handsets, but it also can't not afford to continue selling handsets.

It's a terrible position to be in, and while I believe that CEO John Chen is making a herculean effort, I don't see a clean way out of this.

So, what is Loeb's game plan? Does he — like Watsa — believe that the company will turn a corner?

I don't think so. My bet is that Loeb is positioning himself to either agitate for BBRY's sale or dismemberment.

Can you profit by riding Loeb's coattails? Maybe. But expect it to be a long, drawn-out affair, and understand that it might backfire spectacularly.

The more prudent move here is to simply walk away.

Charles Lewis Sizemore, CFA, is the editor of Macro Trend Investor and chief investment officer of the investment firm Sizemore Capital Management. Click here to receive his FREE weekly e-letter covering top market insights, trends, and the best stocks and ETFs to profit from today's best global value plays.

Monday, February 17, 2014

Top 10 Cheapest Companies To Buy Right Now

He's baaack.

After missing seven straight games with a broken�collarbone, Aaron Rodgers will return to the�Green Bay Packers for a do-or-die showdown against the�Chicago Bears at Soldier Field this Sunday. Arguably, no NFL player means more to his team than�Rodgers, who is the league's highest-paid quarterback, and his comeback couldn't come at a better time. The�Packers can win the NFC North with a win, salvaging what many thought was a lost season.

Are fans gearing up even more than usual? More specifically, are ticket prices up?

The data tells the story
As I pointed out in my piece on Derrick Rose and Chicago Bulls ticket prices, StubHub, a subsidiary of eBay (NASDAQ: EBAY ) , is a great source for ticket information. By analyzing cached versions of the site, it's possible to obtain historical prices rather easily.

Ticket price data via�StubHub. Background image via�Jim Larrison, Flickr. *Cost of the cheapest Grandstand ticket available for the Dec. 29 Bears-Packers game at Soldier Field in Chicago.

Top 10 Cheapest Companies To Buy Right Now: Rocky Mountain Dearlership Inc (RME.TO)

Rocky Mountain Dealerships Inc., through its subsidiaries, sells, rents, and leases new and used construction and agriculture equipment in western Canada. The company offers heavy equipment, such as articulated trucks, rigid frame off-road trucks, excavators, crawler dozers, compaction rollers, motor graders, and wheel loaders; utility equipment comprising loader backhoes, skid steer and compact tracked loaders, compact excavators, compact wheel loaders, and tele-handler and forklifts; paving and aggregates equipment consisting of milling machines, asphalt distributors, asphalt pavers and rollers, screening and washing equipment, and crushing plants; and land clearing equipment, including mulchers and slashers. It also provides agriculture equipment comprising tractors; self-propelled and pull-type combines; seeding and tillage equipment; and hay and forage equipment. The company offers construction equipment under the Case Construction, Terex, Kawasaki, Dynapac, Metso, Le eBoy/Rosco, Cedarapids, and Lamtrac brands; and agriculture equipment under the Case IH agriculture, Kubota, New Holland, Bourgault, SeedHawk, and Claas brand names. In addition, it provides product support services, such as selling parts; and in-branch and on-site repair and maintenance services. Further, the company offers third party finance and insurance products; and ancillary services, including equipment transportation and global positioning satellite signal subscriptions. As of March 19, 2012, it operated 36 dealership branches comprising 24 in Alberta, 7 in Manitoba, and 5 in Saskatchewan. The company serves customers in resource development, construction, agriculture, transportation, manufacturing, industrial processing, and utilities industries. Rocky Mountain Dealerships Inc. was founded in 1949 and is headquartered in Calgary, Canada.

Top 10 Cheapest Companies To Buy Right Now: Ziwo Holdings Ltd. (I9T.SI)

Ziwo Holdings Ltd., an investment holding company, engages in the research, development, manufacture, and sale of 30D terylene filament yarn, sandwich mesh fabric, styrene butadiene rubber (SBR), and other foamed materials primarily in the People�s Republic of China. It also offers foamed SBR, foamed ethylene vinyl acetate, and high foamed polyethylene, which are primarily used as raw materials in the production of sportswear and sports accessories, bags and luggage, furniture upholstery, automobile interior lining, and other lifestyle consumer products. In addition, the company is involved in the trade of foamed materials, textiles, sports and sports accessories, garments, and footwear. It sells its products to approximately 600 customers through a sales and marketing network in Fujian, Guangdong, Shandong, and Zhejiang Provinces, as well as in Shanghai and Tianjin municipalities. The company was founded in 2003 and is based in Quanzhou, the People�s Republic of China. Ziwo Holdings Ltd. is a subsidiary of Sky Upright Holdings Limited.

Top 5 Safest Companies To Buy For 2015: Community Partners Bancorp(CPBC)

Community Partners Bancorp operates as the holding company for Two River Community Bank, a state-chartered commercial bank that provides a range of commercial and retail banking services to small and medium-sized businesses, not-for-profit organizations, professionals, and individuals principally in Monmouth and Union counties, New Jersey. The company offers a range of deposit products, including non-interest bearing or lower cost interest bearing checking accounts, savings accounts, money market accounts, and certificates of deposit accounts. It also provides various loan products consisting of construction loans for residential dwellings, apartment buildings, restaurants, shopping centers, and owner-occupied business properties; commercial business loans; commercial real estate loans for the acquisition of new property or the refinancing of existing property; residential real estate and consumer loans, including residential mortgages, home equity lines of credit, equity loans, personal loans, automobile loans, and overdraft protection; participation loans; and small business administration loans. In addition, the company offers safe deposit boxes, night depositories, wire transfers, money orders, travelers? checks, automated teller machines, direct deposits, telephone and Internet banking services, and corporate business services. It operates 15 banking offices in Middletown, Allaire, Atlantic Highlands, Cliffwood, Manasquan, Navesink, Port Monmouth, Red Bank, Tinton Falls, West Long Branch, Westfield, Cranford, and Fanwood, New Jersey. The company was founded in 2000 and is based in Middletown, New Jersey.

Top 10 Cheapest Companies To Buy Right Now: Discovery Communications Inc(DISCA)

Discovery Communications, Inc. operates as a non fiction media and entertainment company worldwide. The company provides original and purchased programming across various distribution platforms. Its content covers science, exploration, survival, natural history, sustainability of the environment, technology, docu-series, anthropology, paleontology, history, space, archaeology, health and wellness, engineering, adventure, lifestyles, forensics, civilization, and current events. The company owns and operates nine national television networks in the United States, including Discovery Channel, TLC, Animal Planet, Science Channel, Investigation Discovery, Military Channel, Planet Green, Discovery Fit & Health, and Velocity. Discovery Communications also has interests in Oprah Winfrey Network, a pay-television network and Web site; The Hub that features original programming, game shows, and live-action series and specials; and 3net, a three-dimensional network. In addition, it o ffers network branded Web sites, and mobile and video-on-demand services; and distributes various national and pan-regional television networks. Further, the company develops and sells curriculum-based products and services to public and private K-12 schools, such as access to an online VOD service that includes curriculum-based tools, professional development services, and student assessment and publication of hardcopy curriculum-based content; and postproduction audio services to motion picture studios, independent producers, broadcast networks, cable channels, advertising agencies, and interactive producers. As of December 31, 2011, it operated approximately 150 distribution feeds in 40 languages. The company is headquartered in Silver Spring, Maryland.

Advisors' Opinion:

[By Tom Taulli]
Still, BCE has a strong brand and substantial financial resources, as well as a top-notch network that reaches more than 70% of Canadians. BCE also has the advantage of owning premium content, with rights to programming for Discovery (DISCA) and Viacom’s (VIAB) MTV. Its prospects also look bright with concern to mobile, where the company has invested heavily in its payments solutions.
[By Ben Levisohn]
So yes, Disney is a Buy, and DiClemente’s $90 price target suggests another 19% of upside from yesterday’s close, though it should be noted he also likes CBS (CBS), Twenty-First Century Fox (FOXA) and Discover Communications (DISCA).

Top 10 Cheapest Companies To Buy Right Now: Silicon Image Inc.(SIMG)

Silicon Image, Inc. provides wireless and wired high-definition (HD) connectivity solutions that enable the distribution and presentation of HD content for consumer electronics, mobile, and personal computer (PC) markets. It delivers its technology via semiconductor and intellectual property products. The company?s consumer electronics products include high-definition multimedia interface (HDMI) port processors, HDMI and mobile high-definition link (MHL) transmitters, MHL-to-HDMI bridges, and HDMI receiver products; PC products comprise MHL/HDMI-to-HDMI bridges and digital visual interface receivers; and storage products consist of a line of serial advanced technology attachment controllers used in PC, DVR, and network attached storage applications. Its products are deployed by the electronics manufacturers in various devices, such as desktop and notebook PCs, DTVs, Blu-ray disc players, and audio-video receivers, as well as mobile phones, tablets, and digital cameras. The company, through its subsidiaries, provides manufacturers comprehensive standards interoperability and compliance testing services; and acts as an agent for promoting and administering HDMI and MHL specifications, and for licensing the serial port memory technology memory interface specification. It sells its products to original product manufacturers worldwide through direct sales force, as well as through a network of distributors and manufacturer?s representatives. The company has operations in the United States, Taiwan, Japan, China, and Korea, as well as Europe and internationally. Silicon Image, Inc. was founded in 1995 and is headquartered in Sunnyvale, California.

Advisors' Opinion:

[By John Udovich]
We have recently added small cap video chip stock Pixelworks, Inc (NASDAQ: PXLW) to our SmallCap Network Elite Opportunity (SCN EO)�as it stands to benefit from the growth in connecting HD quality video across all mobile device platforms, as well as Smart TVs; but Silicon Image, Inc (NASDAQ: SIMG) and Sigma Designs, Inc (NASDAQ: SIGM) are also providing chips for the video or entertainment markets. Moreover, all three of these small cap stocks have recently reported earnings that might leave you feeling even more bullish.
[By Roberto Pedone]
The exact same setup is shaping up in shares of small-cap semiconductor firm Silicon Image (SIMG). Like HCP, this firm is stuck trading in a downtrending channel. Unlike HCP, trendline resistance is a whole lot stronger in this stock. Shares have gotten swatted down on each of the last eight attempts through that ceiling; with shares at resistance again, the high-probability move is to the downside.

Again, relative strength has been terrible since the summer; SIMG is underperforming the S&P by a considerable margin. Downtrending relative strength is a cardinal sin for stocks, so with shares sitting at resistance, now's a stellar place to be a seller. While support has been pretty strong along the way down, SIMG's previous penetrations through S1 should be a big red flag that buyers are skittish.

SIMG is in a textbook downtrend right now. Don't get caught on the wrong side of the trade.
[By Bryan Murphy]
Quick - what do Simon Property Group Inc. (NYSE:SPG), Dr. Pepper Snapple Group Inc. (NYSE:DPS), and Silicon Image, Inc. (NASDAQ:SIMG) have in common? If you said absolutely nothing, you'd be about 99% right. There's one common thing between SIMG, SPG, and DPS right now, however. What's that? All three stocks are on my personal "buy" list this week.

Top 10 Cheapest Companies To Buy Right Now: Zions Bancorporation(ZION)

Zions Bancorporation, a multi bank holding company, provides various banking and related products and services in the United States. The company offers community banking services, including small and medium-sized business and corporate banking; commercial and residential development, construction, and term lending; retail banking; treasury cash management and related products and services; residential mortgage; trust and wealth management; and investment activities. It also provides personal banking services to individuals, including home mortgages, bankcard, installment loans, home equity lines of credit, checking accounts, savings accounts, time certificates, safe deposit facilities, direct deposits, and automated teller machine access. In addition, the company offers small business administration lending services; secondary market agricultural real estate mortgage loans; municipal finance advisory and underwriting services; and wealth management and online brokerage ser vices. As of December 31, 2010, Zions Bancorporation offered its banking services through 495 branches in Utah, California, Texas, Arizona, Nevada, Colorado, Idaho, Washington, Oregon, and New Mexico. The company was founded in 1873 and is headquartered in Salt Lake City, Utah.

Advisors' Opinion:

[By Rich Smith]
This series, brought to you by Yahoo! Finance, looks at which upgrades and downgrades make sense, and which ones investors should act on. Today, our headlines feature a pair of downgrades for Ryder System (NYSE: R ) and Zions Bancorp (NASDAQ: ZION ) . But the news isn't all bad, so before we address those two, let's start with why one analyst thinks...
[By Ben Levisohn]
Boston Scientific (BSX) has dropped 4.2% to $10.81, making it the second-biggest loser in the S&P 500, while Zions Bancorp (ZION) has fallen 4.1% to $28.03.
[By John Maxfield]
Lest there be any doubt about the magnitude of implications for the banking sector from rising long-term interest rates, Fitzpatrick went on to note a number of startling predictions. First, the full percentage-point jump in rates has already eroded $31 billion in accounting gains from the nation's largest banks. And second, according to estimates from regional bank Zions Bancorp (NASDAQ: ZION ) , if these rates increase by three percentage points, the capital held by the industry would decline by a staggering $200 billion, reducing lending capacity by an estimated $2 trillion.

Top 10 Cheapest Companies To Buy Right Now: Home Properties Inc. (HME)

Home Properties, Inc. is an independent real estate investment trust. The firm invests in the real estate markets of the United States. It is engaged in the ownership, management, acquisition, rehabilitation and development of residential apartment communities. The firm also invests in townhomes and offices. Home Properties, Inc. was founded in November 1993 and is based in Rochester, New York.

Advisors' Opinion:

[By Marc Bastow]
Apartment community real estate investment trust (REIT) Home Properties (HME) raised its quarterly dividend 4.3% to 73 cents per share, payable on Feb. 25 to shareholders of record as of February 13. At a 5% yield, HME is the highest yielder of this week’s list of dividend stocks increasing payouts.
HME Dividend Yield: 5.00%

Top 10 Cheapest Companies To Buy Right Now: Gulf & Pacific Equities Corp. (GUF.V)

Gulf & Pacific Equities Corp. invests in commercial real estate properties in western Canada. It primarily focuses on the acquisition, management, and development of grocery-anchored shopping centers. The company owns grocery-anchored shopping centers located in Whitecourt, Alberta, and St. Paul, Alberta. Gulf & Pacific Equities was incorporated in 1998 and is based in Toronto, Canada.

Top 10 Cheapest Companies To Buy Right Now: Estrella Intl Energy Svcs Ltd (EEN.V)

Estrella International Energy Services Ltd. provides drilling and workover rigs, directional drilling, and wellbore services and consulting to the petroleum, mining, and geothermal sectors in Argentina, Chile, Colombia, Peru, and Bolivia. The company provides drilling and workover rigs; directional drilling, vertical monitoring, drilling optimization, and MWD services for oil and gas drilling operations; and well clean out services for well completion operations. It also engages in the rental of drilling tools, including stabilizers, monels, X-overs, bit subs, roller reamers, down hole motors, jars and shock subs, packers, and bridge plugs; and equipment sales, such as completion accessories, liner hangers, packers, bridge plugs, cement retainers, and sand control screens and accessories to support both drilling and completion operations. In addition, the company involves in project management and engineering consulting services, including well construction, completion, an d intervention engineering; drilling and workover management; production enhancement; field management; equipment engineering and design; rig selection, contracting, fabrication, and commissioning; and engineering studies. Further, it provides a range of cased hole fishing services. The company was founded in 2001 and is headquartered in Buenos Aires, Argentina.

Top 10 Cheapest Companies To Buy Right Now: China Nepstar Chain Drugstore Ltd (NPD)

China Nepstar Chain Drugstore Ltd. operates retail drugstores in the People?s Republic of China. The company?s drugstores provide pharmacy services and other merchandise, including prescription drugs; over-the-counter drugs; nutritional supplements, such as healthcare supplements, vitamins, minerals, and dietary products; herbal products, including drinkable herbal remedies and packages of assorted herbs for making soup; and private label products. Its stores also offer personal care products, such as skin care, hair care, and beauty products; family care products, including portable medical devices for family use, birth control products, and early pregnancy test products; and convenience products, such as soft drinks, packaged snacks, other consumables, cleaning agents, and stationeries, as well as seasonal and promotional items. The company operates its stores under the China Nepstar brand name. As of December 31, 2009, its store network comprised 2,479 retail drugstores located in approximately 71 cities in Guangdong, Jiangsu, Zhejiang, Liaoning, Shandong, Hunan, Fujian, Sichuan, and Hubei provinces, as well as in Shanghai, Tianjin, and Beijing municipalities of the People?s Republic of China. The company was founded in 1995 and is headquartered in Shenzhen, the People?s Republic of China.

Top 10 Cheapest Companies To Buy Right Now: Houston American Energy Corp (HUSA)

Houston American Energy Corp (Houston American), incorporated on April 2, 2001, is an independent oil and gas company focused on the development, exploration, exploitation, acquisition, and production of natural gas and crude oil properties in the United States Gulf Coast region and in South America. The Company�� oil and gas reserves and operations are concentrated in the South American country of Colombia and in the onshore Gulf Coast region, particularly Texas and Louisiana. The Company, along with its partners, manages its resources through acquisitions and divestitures where reserves can be identified, developed, monetized and financial resources redeployed with the objective of growing reserves, production and shareholder value. During the year ended December 31, 2011, the Company participated in the drilling of a total of 13 gross wells, all of which were in Colombia. Of the 13 wells drilled, 11 were classified as exploratory and two were classified as development.

United States Properties

In the United States, the Company�� properties and operations are located in the on-shore Gulf Coast region of Louisiana and Texas. Its producing and exploration properties in Louisiana consist of East Baton Rouge Parish, Plaquemines Parish and Vermilion Parish. It holds a 37.5% working interest in the Profit Island and North Profit Island prospects, covering 3,805 gross acres in East Baton Rouge Parish, Louisiana. In addition, it holds a 7.29% royalty interest in 2,485 royalty acres, as well as a 5.675% royalty interest in the Crown Paper #01 well. It holds a 1.8% working interest in the SL 180771 well and prospect, which covers 300 gross acres. It holds a 2.25% working interest in the 830 acre La Furs, Inc. F-16 well and prospect. Its principal exploration properties in Texas consist of Jim Hogg County and Matagorda Country. The Company holds a 4.375% working interest in the 340 acre Hog Heaven Prospect in Jim Hogg County, Texas. As of December 31, 2011, the Hog Heaven Prospec! t produced gas from a single 6,200-foot well. It holds a 3.5% working interest in the 779 acre Harrison Prospect in Matagorda County, Texas.

Colombian Properties

As of December 31, 2011, the Company held interests in multiple prospects in Colombia covering 825,657 gross acres. Its holdings in Colombia are located within the Llanos and the Caguan Putumayo Basins. As of December 31, 2011 it held interests in five concessions operated by Hupecol. The La Cuerva and LLA 62 concessions are located in the Llanos Basin of Colombia and the Loc Picachos, Macaya and Serrania concessions are located in the Caguan Putumayo Basin of Colombia. The concessions cover an aggregate area of 480,205 acres. As of December 31, 2011, it had interests in 14 gross wells (0.22 net wells) in the La Cuerva block operated by Hupecol. Pursuant to two Farmout Agreements and a Joint Operating Agreement, it holds an interest in the 345,452 acre CPO 4 Block located in the Western Llanos Basin and operated by SK Innovation. As of December 31, 2011, it held a 37.5% interest in the CPO 4 Block. In July 2011, it commenced drilling operations on the first well on the CPO-4 Block, the Tamandua #1. As of December 31, 2011, the Tamandua #1 sidetrack well had been drilled to 13,989 feet. As of March 1, 2012, the Tamandua #1 sidetrack well was drilled to total depth of 15,562 feet.

Top 10 Cheapest Companies To Buy Right Now: S&P 500/Barra Value(SU)

Suncor Energy Inc., together with its subsidiaries, operates as an integrated energy company. The company involves in the development of petroleum resource basins in Canada's Athabasca oil sands; acquisition, exploration, development, production, and marketing of crude oil and natural gas in Canada and internationally; transportation and refining of crude oil; and marketing of petroleum and petrochemical products primarily in Canada. Its Oil Sands segment produces bitumen recovered from oil sands through mining and in-situ technology, and upgrades it into refinery feedstock, diesel fuel, and by-products. This segment?s products include gasoline and distillates. The company?s Natural Gas segment acquires, explores, develops, and produces natural gas, natural gas liquids, oil, and by-products from reserves located primarily in western Canada, the Northwest Territories, Alaska, and the Arctic Islands. Its International and Offshore segment engages in the exploration and pro duction of oil and gas in offshore Newfoundland and Labrador, in the North Sea, and in Libya and Syria. The company?s Refining and Marketing segment refines crude oil at Suncor's refineries in Edmonton, Alberta; Montreal, Quebec; and Sarnia, Ontario in Canada, as well as in Commerce City, Colorado into a range of petroleum and petrochemical products for sale to retail, commercial, and industrial customers. It also transports crude oil through pipelines in eastern and western Canada, as well as through wholly-owned pipelines in Wyoming and Colorado; and produces specialty lubricants and waxes. In addition, this segment operates retail sites in Canada under the Petro-Canada brand; and in Colorado under Phillips 66 and Shell brands. Suncor Energy Inc. also engages in third-party energy trading activities. The company was formerly known as Suncor Inc. and changed its name to Suncor Energy Inc. in April 1997. Suncor Energy Inc. was founded in 1953 and is headquartered in Calgary , Canada.

Advisors' Opinion:

[By Jonathan Yates]
There has been a great deal of concern about the United States suffering from a "lost generation" as Japan has now for several. For investors in oil, this has certainly not been the case: A recent article in The Wall Street Journal noted that oil has risen 310% (Brent Crude) over the last decade. The future looks equally promising for investments in the sector such as ConocoPhillips (NYSE: COP), Suncor Energy (NYSE: SU), Americas Petrogas (BOE.V), and Octagon 88 (OTCBB: OCTX).
[By Arjun Sreekumar]
Given current oil prices, that means several projects are barely profitable, leading some oil sands operators to reconsider new ventures. For instance, Suncor Energy (NYSE: SU ) , one of the largest oil sands producers by output, has been mulling over the profitability of three mining-related ventures jointly proposed with French oil major Total (NYSE: TOT ) .
[By Tyler Crowe]
According to former Suncor Energy (NYSE: SU ) CEO, Rick George, oil sands producers need to do a better job improving the image of this particular type of oil. While the unflattering image that oil sands production has among the general public is probably not helping, there are much bigger fish for oil sands producers to fry. Increased operating costs, labor shortages, and a lack of takeaway capacity are just a few of the major problems that oil sands producers need to address to get the most from this emerging energy source.
[By Achilles Research]
Marathon Oil has been doing well for shareholders with the second best performance in the peer group. Anadarko Petroleum (APC), which I have rated as a Sell recently because the share price has run away from its fundamentals, has returned 186% over five years. Marathon Oil achieved 124%, Occidental Petroleum (OXY) 105%, Suncor Energy (SU) 63%, Apache Corp. (APA) 20% and Devon Energy (DVN) 14%. As a value investor with a contrarian tilt I naturally look at underperformers because they often offer the best risk/reward ratio and asymmetric pay-off profiles. I also just recently added to my positions in Devon Energy and Apache Corp. as they are just too cheap to ignore (thesis here and here). Apache was extraordinarily hit on overblown fears of potential oil production interruptions in Egypt and corresponding asset sales.

Top 10 Cheapest Companies To Buy Right Now: Uni-asia Finance Corporation (C3T.SI)

Uni-Asia Finance Corporation engages in the finance arrangement and investment management of alternative assets primarily shipping and real estates in Japan, China, and Hong Kong. It also involves in the ship chartering arrangements; provision of property investment, project management, accounting and administration, and corporate finance services; and operation, investment, and management of hotels for business travelers and tourists. In addition, the company invests vessels, such as handy size dry bulk ships, containerships, and product tankers; and act as the ship investment manager and provides management and administration services. Further, it offers finance arrangement services for ships; and act as an investment manager, as well as an investor. Additionally, the company engages in the investment and management of industrial and office properties in China and Hong Kong; and residential and hotel properties in Japan, as well as act as hotel operator. As of December 3 1, 2010, it acted as an asset manager for 9 hotels properties; and operated 13 hotels under Hotel vista name. Uni-Asia Finance Corporation was founded in 1997 and is based in Hong Kong, Hong Kong.

Top 10 Cheapest Companies To Buy Right Now: Navios Maritime Holdings Inc. (NM)

Navios Maritime Holdings Inc. operates as a seaborne shipping and logistics company. It focuses on the transportation and transshipment of dry bulk commodities, including iron ore, coal, fertilizers, and grains. The company controls a fleet of 31 owned vessels and 26 chartered-in vessels totaling 5.8 million dwt. Its owned fleet comprises 14 Ultra Handymax, 11 Capesize, 1 Handysize, and 3 Panamax vessels, as well as 2 Panamax vessels under construction; and chartered-in vessels consists of 8 Capesize, 11 Panamax, 1 Handysize, and 6 Ultra Handymax vessels under long-term time charters. The company also engages in port terminal, river barge, and coastal cabotage operations; and charters its vessels under medium to long-term charters to trading houses, producers, and government-owned entities. In addition, it engages in operating ports and transfer station terminals; and handles vessels, barges, and push boats, as well as operates upriver transport facilities in the Hidrovia region. Further, the company engages in the transportation and handling of liquid cargoes through the ownership, operation, and trading of tanker vessels. It has operations primarily in North America, Europe, Asia, and South America. The company is headquartered in Piraeus, Greece.

Advisors' Opinion:

[By Nickey Friedman]
Navios Maritime Holdings (NYSE: NM ) has two operating segments: shipping and logistics. Analysts have already begun to raise their profit estimates for 2014, currently at $0.11 EPS up from $0.01 a week ago. Expect that number to continue to rise dramatically. Navios pays a $0.06 per share quarterly dividend and trades around 40% below its book value. It used to trade as high as $17 back in 2007.

Top 10 Cheapest Companies To Buy Right Now: Strattec Security Corporation(STRT)

Strattec Security Corporation engages in the design, development, manufacture, and marketing of automotive access control products. The company?s products include mechanical locks and keys, electronically enhanced locks and keys, steering column and instrument panel ignition lock housings, latches, power sliding door systems, power lift gate systems, power deck lid systems, door handles, and related products. It also provides full service and aftermarket support for its products. The company offers its products primarily for automotive manufacturers. It markets its products in the United States, Canada, Mexico, Europe, South America, Korea, and China. The company was founded in 1994 and is headquartered in Milwaukee, Wisconsin.

Advisors' Opinion:

[By Martin Vlcek]
Strattec Security Corp. (STRT) is a growing small-cap company with more than 100 years in the automotive supply industry and strong sales growth since 2009. The success and growth of Strattec are still mostly influenced by the global automotive markets. As many analysts still predict ongoing industry growth, the company is poised to continue strongly benefiting from this automotive tailwind. However, the company's recent diversification efforts into new product lines, industries outside of automotive and countries outside of the U.S. have created multiple new growth drivers that will ensure Strattec's continued robust sales and EPS expansion. The company's growth has also become much more balanced and more resilient to a potential automotive industry shock or U.S. slowdown.
[By Monica Wolfe]
Strattec Security (STRT)
Last week Mario Gabelli increased his position in Strattec Security. The guru increased his position 4.82% by adding a total of 13,136 shares to his holdings. He bought these shares at an average price of $43.15, and since then the price per share has increased approximately 5%.

Sunday, February 16, 2014

Gold rides high on the taper effect

Gold prices are heading toward the biggest weekly advance since October. Call it the taper effect. 3.4% gain since Monday

Increasingly-popular wide-moat ETF gives investors an easy way to invest like Warren Buffet. MOAT includes 21 companies with deep and wide competitive advantages. Up 1.3% this year

We might be giving the weather too much credit for the sluggish economic growth. It's cold and snowy, and in other news, it's February. The economics of global cooling

Venture capitalist Tom Perkins wades into the income inequality debate by suggesting the rich should get more votes than the poor. Yep, he said that out loud in public. ”I intended to be outrageous”

Top 10 Penny Companies For 2015

The case for dressing-up your LinkedIn profile. Even Barack Obama has a complete profile and he already has a job. 260 million users can't be wrong

Just in time for Valentine's Day, the SEC's employee's union lawyers have successfully overturned a rule banning agency workers from receiving gifts of flowers. Who says union members don't get any benefits from their dues? Nothing says love like the SEC

Sunday, February 9, 2014

Letter from Former Bill Ackman Protege to Helen of Troy's Board of Directors

Best Safest Companies To Invest In Right Now

NEW YORK, Feb. 4, 2014 /PRNewswire/ -- Sachem Head Capital Management today sent a letter to the Board of Directors of leading consumer goods company Helen of Troy Limited (HELE). In the letter, Sachem Head outlines its belief that Helen of Troy shares are materially undervalued, highlighting the Board's apparent unwillingness to respond to recent inquiries regarding potential strategic combinations, and recommending actions for the Board of Directors to undertake to maximize value for the shareholders, including a thorough and legitimate review of strategic alternatives.

The full text of the letter from Sachem Head Capital Management follows:

Board of Directors
Helen of Troy Limited
One Helen of Troy Plaza
El Paso, TX 79912

February 4, 2014

To the Board of Directors of Helen of Troy Limited:

Sachem Head Capital Management is an investment partnership founded in July 2013 that manages approximately $1 Billion. We selectively and constructively engage management to explore ways to create shareholder value. As of February 4, 2014, Sachem Head owns 1,200,000 shares of Helen of Troy stock, which represent approximately 3.7% of shares outstanding.

Despite its high quality consumer brand portfolio, including leading names such as OXO, Pur, Sure and Pert, Helen of Troy's full value is not appreciated by public markets, particularly relative to what we believe are its most comparable peers (see Exhibit A). Given this underperformance, we believe it is critical that the Board undertake a full review of strategic alternatives to explore opportunities to maximize value for all shareholders. This should include a good-faith sale process with a sincere evaluation of any legitimate offers, rather than summary dismissals of inbound approaches, as we understand has occurred over the past two weeks with at least one potential strategic buyer.

We believe Helen of Troy shares are (and have been) materially undervalued for several reasons:

Poor governance has led to a discounted valuation multiple. As an example, an employment contract for the now-former CEO entitled him to compensation of approximately $43 million in fiscal year 2015. We believe the existence of this contract furthered a pattern of inadequate Board oversight and internal-dealing, which results in a discounted valuation multiple being assigned to the business by public market investors. The recurring cash-generating power of the business is materially understated by GAAP accounting Depreciation & Amortization expense is greater than recurring capital needs. GAAP depreciation & amortization overstates ongoing capital requirements by approximately $18 million due to the inclusion of annual transaction-related amortization expense which does not represent a recurring cash expense of the business. Excessive CEO compensation artificially depresses earnings. If the prior CEO had not resigned, the off-market compensation would have resulted in an understatement of EBIT by approximately $40 million for fiscal year 2015.

As a result, we believe that projected fiscal year 2015 GAAP net income understates the true earnings power of the business by roughly 40% (see Exhibit B).

The balance sheet is underutilized. Helen of Troy is meaningfully less levered than its most comparable peers and has not historically returned excess capital to shareholders (see Exhibit C). Helen of Troy has strategic assets that are highly attractive to potential acquirers. We believe that Helen of Troy's strong brands would be highly synergistic from both a revenue and cost perspective in the hands of a potential acquirer. Unique offshore corporate structure is a hidden asset. Helen of Troy is based in Bermuda, which provides the company with attractive jurisdictional attributes including a low tax rate. Its offshore domicile also makes the company a potential candidate for an "inversion" transaction. If Helen of Troy were to combine with a U.S.-based company in such a transaction (potentially through first reincorporating in Ireland, the U.K., or the Netherlands), its offshore status could provide meaningful economic value above and beyond the base operating value of its business.

To address these points, in November 2013, Sachem Head met with Helen of Troy's then-Chairman and CEO Gerald Rubin, current interim CEO Tom Benson, and then-Lead Director Gary Abromovitz to discuss our views on steps the company could take to maximize shareholder value. Topics discussed included a material capital return to shareholders via a leveraged recapitalization and share repurchase, the possibility of pursuing an inversion transaction with a U.S. company, and CEO succession. We suggested that the company retain financial and legal advisors to investigate these options. The meeting was productive and we were encouraged by the spirit of collaboration present in the room.

Over the course of the next several weeks, we had follow-up conversations with Gerald Rubin, who relayed to us that the company was willing to explore any and all alternatives to maximize shareholder value. Indeed, in early January we were pleased to learn that the Board had retained a leading investment bank as a financial advisor to explore a range of alternatives. Senior representatives of that bank assured us that their review would be broad and include (but not be limited to) our suggestions of a material capital return and a potential strategic transaction.

We were therefore surprised when the company issued a press release on January 16 stating that CEO Gerald Rubin had suddenly resigned and been replaced with an internally promoted new permanent CEO. We were further disappointed to learn, on our follow-up calls with the company and its financial advisor, that the scope of the strategic review would likely be limited to capital return, excluding a broader set of alternatives. Sachem Head believes that limiting the scope of a strategic review and appointing a permanent CEO in the midst of undertaking such a review are steps that are counter to the potential maximization of shareholder value.

While the market reacted positively to Mr. Rubin's departure, we believe that with the benefit of the full context, shareholders should share our entirely different view. Mr. Rubin was engaged and supportive of a broad strategic alternatives process, and we believe the circumstances surrounding his hasty resignation are, ironically, yet another example of inadequate Board stewardship. Furthermore, the hurried internal promotion of a division head to CEO without a comprehensive external search also seems imprudently rushed, myopic and not in shareholders' best interests.

Sachem Head has spoken to multiple potential strategic buyers, and has reason to believe that there are several strategic and financial buyers who may be interested in pursuing an acquisition of Helen of Troy. Sachem Head has specific knowledge of at least one inquiry to the Board in the past two weeks from a well-respected company with financial resources and a proven acquisition track record that was rebuffed. Further, Sachem Head has reason to believe that there may have been similar approaches from others. Despite the recent increase in Helen of Troy's share price, Sachem Head continues to believe that Helen of Troy is materially undervalued and that shares currently trade at a steep discount to the price a strategic buyer would be willing to pay for the company.

In light of the aforementioned facts Sachem Head believes the Board should immediately take the following actions:

Run a full sale process and vet any legitimate offers for the company. We believe a sale of the business maximizes value for Helen of Troy shareholders (potentially in the context of an inversion transaction) and is the best outcome for the long-term health of Helen of Troy's underlying businesses. If a full and legitimate review of strategic alternatives fails to result in a sale of the company, we expect management to optimize Helen of Troy's balance sheet to maximize shareholder value. Helen of Troy is materially under-levered relative to peers Jarden and Spectrum Brands. A more appropriate capital structure would create substantial value for shareholders in light of the unique strategic attributes of the business.

We would remind the entire Board of Directors of your fiduciary duties that include maximizing value for shareholders, and expect you to act accordingly.

Sincerely,

Scott Ferguson
Sachem Head Capital Management

Also check out: Bill Ackman Undervalued Stocks Bill Ackman Top Growth Companies Bill Ackman High Yield stocks, and Stocks that Bill Ackman keeps buying
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Thursday, February 6, 2014

Can General Motors Break Higher?

With shares of General Motors (NYSE:GM) trading around $40, is GM an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

General Motors designs, manufactures, and markets cars, crossovers, trucks, and automobile parts worldwide. The company markets its vehicles primarily under the Buick, Cadillac, Chevrolet, GMC, Opel, Holden, and Vauxhall brand names, as well as under the Alpheon, Jiefang, Baojun, and Wuling brand names. It sells cars and trucks to dealers for consumer retail sales as well as to fleet customers in daily rental car companies, commercial fleet customers, leasing companies, and governments.

General Motors' North American head said he believes the automaker will see a sales bump once the U.S. government exits its remaining stake in the company. Anonymous sources also told the Wall Street Journal that the government could sell its remaining stock in General Motors as soon as this week. The government has said that it plans to leave the company by the end of the year; the U.S. Treasury still owns 31.1 million shares in the Detroit-based automaker. GM has bounced back since its bailout in 2009 but still suffers from an image problem because of the government assistance, including the disparaging nickname "Government Motors."

T = Technicals on the Stock Chart are Strong

General Motors stock has been in a range over the last couple of quarters. The stock is currently surging higher as it trades near highs for the year. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, General Motors is trading above its rising key averages, which signal neutral to bullish price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of General Motors options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
General Motors options	31.04%	73%	70%

What does this mean? This means that investors or traders are buying a very significant amount of call and put options contracts, as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
December Options	Flat	Average
January Options	Flat	Average

As of today, there is an average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a very significant amount of call and put option contracts and are leaning neutral to bullish over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Mixed Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on General Motors’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for General Motors look like and more importantly, how did the markets like these numbers?

	2013 Q3	2013 Q2	2013 Q1	2012 Q4
Earnings Growth (Y-O-Y)	-49.44%	-16.67%	-3.33%	6.49%
Revenue Growth (Y-O-Y)	3.72%	3.88%	-2.32%	3.47%
Earnings Reaction	3.24%	-1.10%	3.01%	0.03%

General Motors has seen decreasing earnings and rising revenue figures over the last four quarters. From these numbers, the markets have had conflicting feelings about General Motors’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has General Motors stock done relative to its peers, Ford Motor (NYSE:F), Toyota Motor (NYSE:TM), Tesla Motors (NASDAQ:TSLA), and sector?

	General Motors	Ford Motor	Toyota Motor	Tesla Motors	Sector
Year-to-Date Return	41.59%	28.19%	30.64%	329.30%	34.47%

General Motors has been a relative performance leader, year-to-date.

Conclusion

General Motors continues to change its business as it looks to entice companies and consumers with its new and improved vehicles. The company's North American head said he believes the automaker will see a sales bump once the U.S. government exits its remaining stake in the company. The stock has been in a range over the last couple of quarters but, is currently surging higher. Over the last four quarters, earnings have been decreasing while revenues have been rising, which produced conflicting feelings among investors. Relative to its peers and sector, General Motors has been a relative year-to-date performance leader. Look for General Motors to OUTPERFORM.

Wednesday, February 5, 2014

Latest Economic Data On Brazil Points To Slower Growth

Oh, poor Brazil. President Dilma Rouseff has turned this economy into the Rodney Dangerfield of the BRICs.

Tuesday industrial production (IP) data showed a manufacturing sector confused over inflation and expecting weaker growth. December IP fell 3.5% month over month, on a seasonally adjusted basis. Consensus was -1.7%. This was the biggest monthly contraction since December 2008, when the global financial crisis was at its peak. In yearly terms, industrial production dropped 2.3%, well below expectations of a 0.1% drop.

A closer look at the data shows poor performance across the board, says George Lei, an analyst for Nomura Securities in New York. On a monthly basis, intermediate goods were down 3.9%, consumer goods 2.5% lower and capital goods fell 11.6%. Although the reading for capital goods was somewhat affected by one-off factors in several truck-producing companies, the magnitude of the plunge is still concerning, particularly after an already hefty 3.5% drop in November. For the emerging markets Americas team at Nomura, the disappointing capital goods number heralds weaker investment momentum ahead.

President Dilma Rousseff of Brazil. Investors blame changes in macro-economic policy for much of the problems facing the economy these days. Weak industrial production figures show a sector unclear on inflation and worried about growth.

November IP was also revised lower to -0.6% from -0.2%.

The data picture for 2013 is looking clearer, says Lei. After a relatively robust performance in the first half of last year, IP deteriorated sharply in the second half. On a quarterly basis, having expanded 1.7% in the first and 0.3% in the second, IP fell 1.3% in the third and declined 0.8% in the fourth.

Last year "proved to be another lost year for Brazilian industry, despite a short-lived recovery early in the year," Lei wrote in a note to clients today.

Tightening of financial conditions in Brazil, caused by domestic and global factors, should come to affect growth over the next 3-6 months, primarily through channels of investments. Lei said he expects investments to expand around 1.5% in 2014, versus over 6% in 2013.

Moreover, December data was not affected by the currency devaluation in Argentina.

"The ongoing situation in Argentina may have a substantial impact on Brazilian industry, as over three-quarters of Brazilian exports to Argentina are manufactured goods, and the majority of manufactured goods are vehicles and auto-parts," he wrote.

Last week, Nomura said that it expected the turmoil in Argentina to shave at least 0.2 percentage points off Brazilian growth in 2014. As IP data for the first quarter comes in, investment banks like Nomura will likely start lowering their outlook for Brazil in 2014.

The 10 Most Powerful Businesswomen In Brazil

Monday, February 3, 2014

LivingSocial's Coupon is Set to be Punched by Amazon

NEW YORK (The Deal) -- With Amazon.com (AMZN) writing down its investment in LivingSocial to nothing, the future of yet another social media startup is very much in doubt. While the company insists it will soldier on, sources said it's more likely to end up absorbed by the online retail giant.

John Bax, the CFO of the Washington-based company said LivingSocial's board has elected to re-invest $260 million it recently reaped selling Korean e-commerce company TicketMonster to competitor Groupon (GRPN).

Bax also insisted that cash received for the sale of Groupon shares that LivingSocial picked up as part of the TicketMonster transaction were likewise going back into the company.

The company's revenue fell to $399 million in 2013 from $455 million in 2012, and it lost over $180 million last year, according to a regulatory filing from Amazon. Granted, it had lost $653 million the year before, but it had also dumped TicketMonster -- at a loss, since it had acquired it for a reported $350 million. Amazon also said, in the same filing, that its "investment in LivingSocial has been reduced to zero due to our recognition of equity-method losses." That's quite a comedown for a company that, in rosier times, reportedly valued itself at up to $15 billion, chatting up bankers for an initial public offering to follow Groupon's 2011 debut and raising hundreds of millions of dollars. Despite Bax's insistence that LivingSocial was focused on the future, the CFO acknowledged that Amazon was a "likely" acquirer of the company, specifically noting that Jeff Bezos' company "has an interest in [LivingSocial's] local offers" business. So despite those continuing losses, LivingSocial is hoping that a right-sized business will soon turn a profit. Along with its ownership of TicketMonster, LivingSocial's events business is no more. Back in February 2013, LivingSocial had to fight off what it characterized as an inaccurate report regarding its last $110 million round -- the company raised a little under $1 billion -- after financial data site PrivCo reported the startup needed to secure emergency debt to stave off failure. CEO and co-founder Tim O'Shaughnessy acknowledged the company raised "a down round, which I'm sure is not a shock to anyone," but didn't offer any clarity into the nature of the funding, other than to say "we hope to turn the corner to become profitable soon" and acknowledging "there were some bells and whistles" that came along with the round. Bax said the comment about "bells and whistles," did not entitle Amazon, which led the last fundraising round, to anything specifically pertaining to M&A. But sources said that Amazon is the only potential buyer of LivingSocial's assets. O'Shaughnessy said last month he would step down from his CEO role as soon as his replacement is found. When O'Shaughnessy sought to quell questions over his company's future last February with a well-publicized staff memo, he stated, "we sold 7.5% of the company for $110" million, adding "this should give you some idea of the current valuation of the company." That appeared to give the company a valuation of nearly $1.5 billion. That was in stark contrast to Amazon, which said in a regulatory filing at the end of March that it valued its 31% stake at $36 million. To be certain, LivingSocial hasn't been the only e-commerce startup to stumble upon hard times. For instance, ideeli, another online retailer, sold to Groupon recently for substantially less cash than it raised. Amazon declined to answer when a request for comment was sent to the company and Amazon and, separately, to Bezos.

Stock quotes in this article: AMZN, GRPN

Sunday, February 2, 2014

Breakdown of what airlines charge, and for what

Airline fees for everything ranging from booking a trip by phone to checking a bag are on the rise, and four carriers are levying fees of $400 or more, a USA TODAY survey of a dozen U.S. airlines shows.

Delta Air Lines charges $400 to change a ticket on some international flights — a $150 increase over its most-expensive flight-change fee in 2011, when USA TODAY did a similar survey.

American Airlines charges $450 for an overweight checked bag weighing 71 to 100 pounds for some international flights, while such a bag on United Airlines' international flights and Hawaiian Airlines' Asian flights costs $400.

Fees are a major source of revenue for the industry. According to the Department of Transportation's Bureau of Transportation Statistics, 15 U.S. airlines reported revenues of $2.6 billion from baggage fees and $2.1 billion from reservation-change fees during the first three quarters last year.

Charging passengers fees "for services they value and are willing to pay for" has "enabled airlines to provide consumers the ultimate choice and control over what they purchase," says Victoria Day, a spokeswoman for the Airlines for America trade group.

Without charging fees last year, airlines would have lost money and offered fewer flights, she says.

USA TODAY'S most recent survey took two weeks to complete and focused only on fees applicable to most coach passengers. There are a myriad of other fees that apply to first-class passengers, for instance.

The survey found that some fees are difficult to find or are missing on airline Web pages, and terms of some others are vague or incomplete.

United Airlines' website, for example says the carrier's fee for Premier Access, which provides priority check-in and boarding privileges, starts at $9. The price, though, can range up to $59 for some flights, USA TODAY was told when it requested the information from the company.

The most expensive fees for a single checked bag are those of Spirit Airlines and Allegiant! Air. Spirit charges $100 for a bag that must be checked in at an airport gate, and Allegiant charges $75 for a bag checked in at an airport for a Hawaii flight.

Both airlines have much lower fees for fliers who check a bag in advance and online.

Nearly all airlines charge for booking on the phone what was once known as a "free" frequent-flier award ticket.

Spirit and US Airways have some of the highest fees for such bookings. Spirit's charges $25 for a phone booking and nothing for an online booking, but has an additional charge of $100 for booking within six days of departure.

US Airways charges $90 to book on the phone an award ticket for an international flight. Fliers who book online are charged $50 for a Hawaii or international flight.

According to the Department of Transportation's Bureau of Transportation Statistics, 15 U.S..airlines reported revenues of $2.6 billion from baggage fees and $2.1 billion from reservations change fees during the first three quarters last year.