Saturday, August 31, 2013

How women can invest wisely to minimise tax outgo

Below is the verbatim transcript of Roongta's interview with CNBC-TV18.

Q: It is an International Women's Day today, so it is appropriate that we focus on the investment needs of women. How can a woman invest wisely to minimise her tax outgoes? Is it wise to invest in the women oriented schemes offered by mutual funds or should a woman go for asset allocation according to her risk profile?

A: I think woman investor is an investor first and woman later. So, whatever applies to other investors as much applies to women. She must look at what risks she can take what goals she has. If they are long-term then ability to take risk increases and therefore allocates to specific assets whether it is equity, debt or whatever.

As far as specific schemes are concerned, mutual fund industry has not come out with too many specific schemes. There is UTI Mahila Unit Scheme , which is a hybrid debt aggressive scheme. Performance has not been anything to write home about. It is not among the top quartile.

There are a lot of woman oriented insurance policies. However, what applies to regular investors that not to mix insurance and investment, applies to woman investors as well. Therefore, I think no specific schemes that are good are available for woman.

Women entrepreneurs looked upon as glorified housewives

Therefore, a woman needs to invest just like any other investor. It is possible that the risk profile might be different. For example in some cases if it is an income that it to be used to create wealth then your ability to take risk is higher and therefore you can have higher allocation to equity.

Thursday, August 29, 2013

Discover Financial Stays at Neutral - Analyst Blog

Top 5 Growth Stocks To Invest In Right Now

We have retained our Neutral recommendation on Discover Financial Services (DFS) based on the company's fundamental strength, which offsets headwinds such as rising expenses and competitive pressure.

Why Reiterate?

Discover Financial's card sales volume has been increasing over the past several years due to higher average spending per customer, increase in new customers, impact of increased marketing and broadened merchant acceptance. Moreover, the company continues to launch new products tailored to specific customer needs in order to attract new customers.

This Zacks Rank #2 (Buy) company has implemented several capital bolstering initiatives, including equity and debt offerings, which have helped it achieve a strong capital base. Moreover, the strong cash position and outlook influenced management to increase Discover Financial's dividend by 43% in Apr 2013.

Moreover, Discover Financial regularly forms alliances to boost card acceptances and expand its network. The company is also working hard to establish a foothold in the international card market and has already forayed into India, China, Ecuador, Russia and Nigeria, among others.

However, Discover Financial incurs considerable expenses in order to compete with other credit card issuers to attract and retain customers, and increase card usage. Moreover, the company's competitors in the credit card business have substantially larger scales of operation, posing ample risk on the operational front. Not only do the competitors have a relatively stronger global presence and brand names, but they own exclusive contracts with many financial institutions as well, thereby limiting Discover Financial's business opportunities with such institutions.

Despite these negatives, Discover Financial's earnings remain strong. The company reported first-quarter 2013 e! arnings per share (EPS) of $1.33, surpassing the Zacks Consensus Estimate of $1.12 as well as the year-ago quarter's earnings of $1.21.

Even in the second quarter of 2013, Discover Financial's EPS is expected to grow 15.42% year over year. The Zacks Consensus Estimate for the company's second-quarter earnings stands at $1.15.

Other Stock to Consider

Other companies worth considering in the financial sector are Capital One Financial Corp. (COF) – Zacks Rank #1 (Strong Buy), World Acceptance Corp. (WRLD) – Zacks Rank #2 (Buy) and Regional Management Corp. (RM) – Zacks Rank #2 (Buy).

Enstar to Acquire Torus Insurance - Analyst Blog

Top Low Price Stocks To Invest In Right Now

To enhance its insurance business, Bermuda based Enstar Group Limited (ESGR) has inked a deal to acquire global specialty insurer Torus Insurance Holdings Limited. The purchase consideration equates to $692 million.

Enstar will partially finance the deal by issuing 1.9 ordinary voting shares and 0.7 million newly created non-voting preferred shares. These shares sum up to $346 million or 50% of the purchase consideration.

Out of the remaining $346 million of the purchase price, Enstar will provide $69 million in cash and the other $277 million will be provided by affiliates of Stone Point Capital LLC through an equity co-investment. Stone Point is a private equity firm that makes investments and manages financial services businesses. The deal is expected to culminate by the end of 2013.

In addition to Torus, StonePoint has also partnered with Enstar for its previously announced acquisitions of Atrium Underwriting Group and Arden Reinsurance Company.

Stone Point affiliates will provide up to $106 million of equity capital for the acquisition of Atrium Underwriting Group and Arden Reinsurance Company from Arden Holdings Limited which was announced in Jun 2013 to provide live underwriting services. This deal is also expected to culminate by the end of 2013. On culmination of both the aforementioned deals, Enstar and Stone Point will have an ownership interest of 60% and 40% respectively in Torus and Arden Holdings.

The company has been taking frequent steps to foray into the live insurance market. At this juncture, the aforementioned endeavors make us pose an optimistic stance on the company. First, the acquisition of Atrium is in line with the company's objective of portfolio expansion. Second, the company has also been working towards enhancing its existing business.

The acquisition of Torus satisfies this aim o! f the company by enhancing its core legacy operations. Last but not least, the partnership with Stone Point for the past 13 years have proved successful and is thus expected to add value to the above acquisitions.

Concurrently, Enstar has entered into an amended and restated five-year revolving credit facility with National Australia Bank, Barclays Bank and Royal Bank of Canada, effective Jul 2018. As per this deal, Enstar can borrow up to $375 million for a coupon rate of LIBOR plus 2.75% for amounts drawn and 1.1% commitment fee on undrawn funds.

Enstar currently carries a Zacks Rank #1 (Strong Buy). Among other favorable names in the insurance industry, Cigna Corp. (CI), CNO Financial Group Inc. (CNO) and Assured Guaranty Ltd (AGO) also carry a Zacks Rank #1 (Strong Buy).

Tuesday, August 27, 2013

Limited Brands Posts Flat Comps - Analyst Blog

L Brands, Inc. (LTD) posted flat comparable-store sales for the five-week period ended Jul 6, 2013.

This specialty retailer of women's intimate and other apparel, beauty and personal care products showcased a 2.2% rise in net sales of $1,101 million from $1,077 million in the prior-year period.

Besides Limited Brands, other retail chains that posted comparable-store sales data for the month of June, include clothing chain, The Gap, Inc. (GPS) that registered comps growth of 7%, off-price retailer of apparels, footwear and accessories Stein Mart Inc. (SMRT) delivered comparable-store sales growth of 6.5%, while discount store operator Fred's, Inc. (FRED) registered a 4.5% rise in comps.

A recovery in the housing market, stock prices gaining momentum, improving labor market, lower gas prices and favorable weather conditions played vital roles in raising consumer confidence. These positives aided retailers, which also resorted to clearance discounts to generate healthy sales for the month under review.

However, Limited Brands' less competitive pricing strategy led to a decline in clearance sales and impacted the results. Comparable-store sales for June fell 1% at Victoria's Secret Stores & Victoria's Secret Beauty, remained flat at La Senza but rose 2% at Bath & Body Works & The White Barn Candle Co. Sales dipped 9% at Victoria's Secret Direct. Management now projects total comparable-store sales to rise in the low single-digit for the month of July.

For the twenty-two week period ended Jul 6, 2013, comparable-store sales increased 2%, whereas net sales rose 5.2% to $4,106 million from $3,903 million in the year-ago period.

Currently, Limited Brands holds a Zacks Rank #3 (Hold).

10 Numbers That Explain This Bull Market -- And Where ...

Top 10 Warren Buffett Stocks To Invest In Right Now

After the markets steadily fell over the second half of 2008, the first trading day of 2009 brought a dose of investor optimism, with the S&P 500-stock index rising 3% to close at 932. Hopes of a sustained rebound were quickly dashed as the index went on to finish below 700 just a couple of months later.

Even the boldest investors, piling their final funds into the market in search of deep value, were about ready to throw in the towel.

And then, the clouds suddenly parted on the morning of March 10, 2009, and stocks began to climb and climb. A little more than four years later, the S&P 500 has racked up a stunning 150% gain. Yet as the market moves ever higher, investors have grown antsy.

The rally hasn't come on the heels of a robust economic expansion. Instead, the U.S. economy muddles along, as key trading partners move in and out of intensive care. Does that mean stocks are now overvalued in the face of considerable global headwinds? Well, a closer look at the numbers can give a sense of whether this bull has more room to run -- or if it is growing tired. Here are 10 ways to look at this market.

1. 25% vs. 1%
In the past year, the S&P 500 has risen roughly 25%, even as aggregated 12-month trailing profits for companies in the S&P 500 rose roughly 1% in the second quarter of 2013, compared with the prior 12-month rolling period. The outlook for profit growth in the next few quarters also calls for aggregated earnings-per-share (EPS) growth in the low single-digits.

2. 14.5 vs. 17
A year ago, the S&P 500 traded for about 14.5 times trailing 12-month profits. That figure now stands at 17 times trailing profits. That's slightly above the 10-year average, according to Bespoke Investment Research. Looking at the past 85 years' worth of data, bull markets tend to begin with! an average trailing price-to-earnings (P/E) ratio of 11.1 (which was the case at the end of 2008). And bull markets tend to end, on average, when the figure reaches 18.2. By that math, we have less than 10% upside remaining until we hit the upper end of the average. Then again, some argue that P/E ratios simply don't matter. At the start of 1998, the trailing P/E on the S&P 500 stood at an already elevated 20 -- but still moved up to 30 in the next two years.

3. 23.80
Yale University professor Robert Shiller prefers to look at earnings in the context of economic cycles, developing what he calls the cyclically adjusted price-to-earnings ratio, or CAPE. The technical explanation: "The numerator of the CAPE is the real (inflation-adjusted) price level of the S&P 500 index, and the denominator as the moving average of the preceding 10 years of S&P 500 real reported earnings, where the U.S. Consumer Price Index (CPI) is used to adjust for inflation," according to his website.

As of July, this figure stood at 23.8. That's up from 20.5 at the end of 2011 and 15.3 at the end of 2008. The current reading is the highest since January, 2008, when it stood at 24. For a bit of perspective, the CAPE exceeded 40 back in 1999 and 2000, so we're hardly in frothy territory.

4. 1,600
Our current bull market has been underway for 1,600 days. From 1928 through 1973, the average bull market lasted 1,140 days. From 1974 through 2007, the average bull market lasted roughly 2,650 days. By that measure, this bull market could last three more years.

5. $1.42 trillion
That's how much money is now invested in exchange-traded funds (ETFs). That compares to $531 billion at the end of 2008. The 170% increase in ETF assets since the end of 2008 is roughly double the rise in the S&P 500 in that time, implying that inflows into ETFs, and not just asset appreciation, are a key hallmark of this bull market. It also means that traditional stock picking is losing favor t! o sector,! industry and thematic styles of investing. Meanwhile, investors still had $13 trillion in mutual funds as of the end of 2012, according to the Investment Company Institute, putting to rest the notion that "ETFs are killing mutual funds."

6. 3.5%
After shrinking 2% in 1982, the U.S. economy roared to life, averaging 5.5% GDP growth over the next three years, and then averaged 3.5% annual GDP growth over the next 15 years, according to the Bureau of Economic Analysis (BEA). That coincided with an 18-year bull market (if you exclude a brief correction in 1987).

Coming out of the recession of 2008, the U.S. economy has had a hard time generating growth in excess of 2% (with the exception of a few quarters in 2012). This year, GDP has grown just 1.1% in the first quarter and 1.7% in the second quarter, which helps explain why corporate profit growth has largely stalled out.

7. 48%
The percentage of sales generated by companies in the S&P 500 from foreign sales offices peaked at 48% in 2008 (after rising from 43% in 2005). That figure now stands at 46% after dropping for four straight years. In effect, U.S. economic activity, along with corporate profit growth, has been clearly hampered by troubles in Europe. To the extent that China's woes deepen, affecting large U.S. export markets such as Australia and Brazil, the export figure may keep dropping. Then again, an eventual rebound in Europe could help reverse the trend and provide a key growth tailwind that extends this bull market.

8. 1.96%
That's the average dividend yield on the S&P 500, according to Though companies have been boosting dividends at a rapid pace, they can't keep up with the surging bull market, so the dividend yield has been steadily falling. At the start of the bull market in 1982, the dividend yield on the S&P 500 stood at 6.7%. Today, there are only two companies in the S&P 500 (Windstream (NYSE: WIN) and Frontier Communications (NYSE: FTR)) that have a! yield ab! ove 6.7%. The S&P 500's dividend yield hit an all-time low of 1.4% in 1998, as market gains outpaced dividend growth by a wide margin.

9. $1.27 trillion
That's how much cash was parked on the balance sheets of non-financial firms in the S&P 500 at the end of 2012, according to FactSet Research. The pile of cash grew 6.1% last year, despite the fact that share buybacks and dividends are growing at a 10% pace. The most important implication for this bull market: Any sharp market pullback would be swiftly met with increased buybacks.

10. 87
That's the number of companies in the S&P 500 that are expected to boost sales at least 10% in 2014. And only 21 of those are expected to generate at least 20% revenue growth in 2014. Fully 40 companies in the S&P 500 are expected to see revenues fall in 2014.

Monday, August 26, 2013

5 Stocks Under $10 to Trade for Breakouts

DELAFIELD, Wis. (Stockpickr) -- At Stockpickr, we track daily portfolios of stocks that are the biggest percentage gainers and the biggest percentage losers.

>>5 Big Trades You Can't Miss This Week

Stocks that are making large moves like these are favorites among short-term traders because they can jump into these names and try to capture some of that massive volatility. Stocks that are making big-percentage moves either up or down are usually in play because their sector is becoming attractive or they have a major fundamental catalyst such as a recent earnings release. Sometimes stocks making big moves have been hit with an analyst upgrade or an analyst downgrade.

Regardless of the reason behind it, when a stock makes a large-percentage move, it is often just the start of a new major trend -- a trend that can lead to huge profits. If you time your trade correctly, combining technical indicators with fundamental trends, discipline and sound money management, you will be well on your way to investment success.

>>5 Stocks Under $10 Hedge Funds Love

With that in mind, let's take a closer look at a several stocks under $10 that are making large moves to the upside today.

Alpha Natural Resources

Alpha Natural Resources (ANR) is a supplier and exporter of metallurgical coal for use in the steel-making process and a major supplier of thermal coal to electric utilities and manufacturing industries across the country. This stock closed up 5.9% to $6.28 a share in Thursday's trading session.

Thursday's Range: $6.06-$6.36

52-Week Range: $4.78-$10.74

Thursday's Volume: 10.08 million

Three-Month Average Volume: 11.14 million

>>5 Stocks Warren Buffett Is Buying in 2013

From a technical perspective, ANR ripped higher here right above its 50-day moving average of $5.55 with decent upside volume. This stock recently formed a double bottom chart pattern at $4.82 to $4.78. Following that bottom, shares of ANR have started to uptrend over the last few weeks, with shares moving higher from $4.78 to its recent high of $6.39. During that uptrend, shares of ANR have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of ANR within range of triggering a big breakout trade. That trade will hit if ANR manages to take out some near-term overhead resistance at $6.39 with high volume.

Traders should now look for long-biased trades in ANR as long as it's trending above 50-day at $5.55 and then once it sustains a move or close above $6.39 with volume that hits near or above 11.14 million shares. If that breakout hits soon, then ANR will set up to re-test or possibly take out its next major overhead resistance levels at $7.60 to $8.40.

Arch Coal

Arch Coal (ACI), a coal producer in the U.S., sells coal to power plants, steel mills and industrial facilities. This stock closed up 6.9% to $4.65 in Thursday's trading session.

Thursday's Range: $4.41-$4.68

52-Week Range: $3.47-$8.86

Thursday's Volume: 8.43 million

Three-Month Average Volume: 9.93 million

>>5 Stocks With Big Insider Buying

From a technical perspective, ACI bounced sharply higher here right above its 50-day moving average of $4.06 with decent upside volume. This stock has been uptrending strong for the last two months, with shares moving higher from its low of $3.47 to its recent high of $4.78. During that move, shares of ACI have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of ACI within range of triggering a near-term breakout trade. That trade will hit if ACI manages to take out some near-term overhead resistance at $4.78 with high volume.

Traders should now look for long-biased trades in ACI as long as it's trending above its 50-day at $4.06 and then once it sustains a move or close above $4.78 with volume that hits near or above 9.93 million shares. If that breakout triggers soon, then ACI will set up to re-test or possibly take out its next major overhead resistance levels at its 200-day moving average of $5.50 to $6.

Mechel OAO

Mechel OAO (MTL) is a vertically integrated mining, steel, ferroalloys and power group. This stock closed up 7.2% to $3.09 in Thursday's trading session.

Thursday's Range: $2.95-$3.10

52-Week Range: $2.60-$8.34

Thursday's Volume: 1.43 million

Three-Month Average Volume: 2.70 million

>>Hedge Funds Hate These 7 Stocks -- but Should You?

From a technical perspective, MTL ripped sharply higher here right off its 50-day moving average of $2.95 with lighter-than-average volume. This move is quickly pushing shares of MTL within range of triggering a major breakout trade. That trade will hit if MTL manage to take out some near-term overhead resistance levels at $3.15 to $3.29 with high volume.

Traders should now look for long-biased trades in MTL as long as it's trending above its 50-day at $2.95 or above more support at $2.85 to $2.76, and then once it sustains a move or close above those breakout levels with volume that hits near or above 2.70 million shares. If that breakout triggers soon, then MTL will set up to re-test or possibly take out its next major overhead resistance levels at $3.98 to $4.37. Any high-volume move above those levels will then give MTL a chance to tag its next major resistance level at $5.

First Marblehead

First Marblehead (FMD) offers education loan programs for K-12, undergraduate and graduate students. It also offers related ancillary services including loan origination, retail banking, portfolio management and securitization services. This stock closed up 5.4% to 97 cents per share in Thursday's trading session.

Thursday's Range: $0.88-$0.98

52-Week Range: $0.61-$1.92

Thursday's Volume: 550,000

Three-Month Average Volume: 1.04 million

>>5 Stocks Rising on Unusual Volume

From a technical perspective, FMD bounced higher here right above its recent low of 87 cents per share with lighter-than-average volume. This stock recently gapped down huge from $1.60 to 87 cents with heavy downside volume. That move has pushed shares of FMD into oversold territory, since its current relative strength index reading is 26.73. Following that gap down, shares of FMD have started to rebound higher and move within range of triggering a near-term breakout trade. That trade will hit if FMD manages to take out its gap down day high of $1.07 and its 200-day moving average at $1.08 with high volume.

Traders should now look for long-biased trades in FMD as long as it's trending above its recent low of 87 cents per share and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.04 million shares. If that breakout hits soon, then FMD will set up to re-fill some of its previous gap down zone that started at $1.60. Some possible upside targets if FMD gets into that gap with volume are $1.20 to $1.30.

Nordic American Tankers

Nordic American Tankers (NAT) is an international tanker company that owns approximately 20 modern double-hull Suezmax tankers, including four newbuilding vessels. This stock closed up 5.3% to $8.42 in Thursday's trading session.

Thursday's Range: $8.01-$8.45

52-Week Range: $7.00-$12.10

Thursday's Volume: 815,000

Three-Month Average Volume: 972,425

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>>5 Heavily Shorted Stocks That Hedge Funds Love

From a technical perspective, NAT ripped higher here right above some near-term support at $7.73 with decent upside volume. This stock has been downtrending badly for the last month, with shares falling from its high of $10.31 to its recent low of $7.73. During that move, shares of NAT have been making mostly lower highs and lower lows, which is bearish technical price action. That said, shares of NAT are rebounding strong off that $7.73 low and it's now quickly moving within range of triggering a near-term breakout trade. That trade will hit if NAT manages to take out both its 50-day moving average at $8.49 to its 200-day moving average at $8.63 with high volume.

Traders should now look for long-biased trades in NAT as long as it's trending above $8 or above that low at $7.73 and then once it sustains a move or close above those breakout levels with volume that hits near or above 972,425 shares. If that breakout hits soon, then NAT will set up to re-test or possibly take out its next major overhead resistance levels at $9.89 to $10, or possibly even $10.31.

To see more stocks that are making notable moves higher today, check out the Stocks Under $10 Moving Higher portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.


>>5 Stocks Under $10 Set to Soar

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Follow Stockpickr on Twitter and become a fan on Facebook.

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

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including and You can follow Pedone on Twitter at or @zerosum24.

Saturday, August 24, 2013

Hot Oil Stocks To Invest In 2014

Egypt and its recent troubles have been a Sword of Damocles hanging over Apache (NYSE: APA  ) since the Arab Spring erupted in December 2010. Since then, Egypt has been in a constant state of flux that has led to new leadership and economic struggles. Apache is currently one of the largest leaseholders and producers in the country, and investors' worries regarding the country-specific risks have left the stock trading well below its peer averages.

Recent struggles providing its citizens with affordable diesel fuel have left the country clamoring for deals with its Middle East brethren. Some countries have come to its aid, but with only 50% of its refining capacity being used, wouldn't it make sense to put its own reserves to work?

What kind of presence does Apache have?
Egypt currently accounts for 10% of Apache's total estimated reserves, at 273 million barrels of oil equivalent. That level of reserves resides under 9.7 million gross acres, making Apache the largest leaseholder in Egypt's Western Desert. For 2013, management plans to invest $1.1 billion in the region to continue its successful campaign there, and closer ties with the government would make things that much more comfortable.�

Hot Oil Stocks To Invest In 2014: Gastar Exploration Ltd (GST)

Gastar Exploration Ltd (Gastar) is an independent energy company engaged in the exploration, development and production of natural gas and oil in the United States. The Company�� principal business activities include the identification, acquisition, and subsequent exploration and development of natural gas and oil properties with an emphasis on unconventional reserves, such as shale resource plays. As of December 31, 2011, it is pursuing the development of liquids-rich natural gas in the Marcellus Shale in the Appalachia area of West Virginia and, to a lesser extent, central and southwestern Pennsylvania. The Company also holds prospective acreage in the deep Bossier play in the Hilltop area of East Texas and conduct limited coal bed methane (CBM) development activities within the Powder River Basin of Wyoming and Montana. The Company is a holding company. Advisors' Opinion:
  • [By Roberto Pedone]

     Gastar Exploration (GST) is an independent energy company, engaged in the exploration, development and production of natural gas and oil in the U.S. This stock is trading up 2.8% to $1.26 in recent trading.

    Today’s Range: $1.24-$1.30

    52-Week Range: $0.70-$3.36

    Volume: 186,000

    Three-Month Average Volume: 516,159

    From a technical perspective, GST is bouncing modestly higher here right above some near-term support $1.15 with light volume. This stock has been uptrending strongly for the last month and change, with shares soaring from a low of 70 cents to its recent high of $1.38. During that move, shares of GST have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed GST within range of triggering a major breakout trade. That trade will hit if GST clears some near-term overhead resistance levels at $1.38 to $1.39 with high volume.

    Traders should now look for long-biased trades in GST as long as it’s trending above $1.15, and then once it sustains a move or close above those breakout levels with volume that hits near or above 516,159 million shares. If that breakout triggers soon, then GST will set up to re-test or possibly take out its next major overhead resistance level at its 200-day moving average of $1.77 or possible even $1.89 to $1.96.

Hot Oil Stocks To Invest In 2014: Shell Refining Company (SHELL)

Shell Refining Company (Federation of Malaya) Berhad is principally engaged in refining and manufacturing of petroleum products. The Company operates primarily in Malaysia. Its operations also include the gas to liquids (GTL) plant of its kind in Bintulu, Sarawak, and a refinery in Port Dickson, Negeri Sembilan. Its upstream operations focus on the development and extraction of crude oil and natural gas offshore Sarawak and Sabah. In downstream its main activity is in refining, supply, trading and shipping of crude oil and petroleum products through the sales and marketing of transportation fuels, lubricants, specialty products and technical services. The Company is also a partner in two joint ventures that convert natural gas to liquefied natural gas. Royal Dutch Shell plc is its holding company.

5 Best Safest Stocks To Buy Right Now: BMB Munai Inc (BMBM)

BMB Munai, Inc., incorporated in July 1981, focuses on oil and natural gas exploration and production in the Republic of Kazakhstan (Kazakhstan) through a wholly owned operating subsidiary, Emir Oil LLP, (Emir Oil). Emir Oil holds an exploration contract that allowed exploration drilling and oil production in the Mangistau Province in the southwestern region of Kazakhstan. On February 14, 2011 the Company entered into a Participation Interest Purchase Agreement (the Purchase Agreement) with MIE Holdings Corporation (MIE), and its subsidiary, Palaeontol B.V (Palaeontol), pursuant to which the Company agreed to sell all of its interest in Emir Oil to Palaeontol (the Sale). On September 19, 2011, the Company completed the sale of all of its interests in Emir Oil LLP to a subsidiary of MIE Holdings Corporation. The operations of Emir Oil LLP is classified as discontinued.

The initial distribution amount was determined after giving effect to the estimated closing adjustments, Escrow amount, repayment of the Convertible Senior Notes, and after providing for the payment of or reserve for other anticipated liabilities and transaction costs. In February 2012 the Company entered into a Management Services Agreement (Services Agreement) with Lakeview International, LLC (Lakeview). Pursuant to the Services Agreement, Lakeview is providing management, administrative and support personnel and services to the Company.

Hot Oil Stocks To Invest In 2014: Halliburton Company(HAL)

Halliburton Company provides various products and services to the energy industry for the exploration, development, and production of oil and natural gas worldwide. It operates in two segments, Completion and Production, and Drilling and Evaluation. The Completion and Production segment offers production enhancement services, completion tools and services, cementing services, and Boots & Coots. Its production enhancement services include stimulation and sand control services; completion tools and services comprise subsurface safety valves and flow control equipment, surface safety systems, packers and specialty completion equipment, intelligent completion systems, expandable liner hanger systems, sand control systems, well servicing tools, and reservoir performance services; cementing services consist of bonding the well and well casing, while isolating fluid zones and maximizing wellbore stability, and casing equipment; and Boots & Coots include well intervention services , pressure control, equipment rental tools and services, and pipeline and process services. The Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation, and wellbore placement solutions that enable customers to model, measure, and optimize their well construction activities. Its services comprise fluid services, drilling services, drill bits, wireline and perforating services, testing and subsea services, software and asset solutions, and integrated project management and consulting services. The company serves independent, integrated, and national oil companies. Halliburton Company was founded in 1919 and is headquartered in Houston, Texas.

Advisors' Opinion:
  • [By Nathan_Slaughter]

    Halliburton is ranked among the top oilfield services companies in America. It has global operations aiding oil companies in the exploration and drilling of wells. Ever since the introduction of the new horizontal drilling technology, Halliburton has been able to boost its productive capacity exponentially from 500 billion barrels about 5 years ago to nearly 4.5 trillion as of date. Revenue through overseas operations has increased nearly 20% since the third quarter of 2011. Also, the company is expected to expand its field of operations significantly in the coming years seeing that power-houses China and Argentina seek assistance from Halliburton for the development of their national oil and gas fields. The current market capitalization of the company is massive at a staggering $30 billion with total recorded revenue of $25 billion in 2011. At a current trading price of around $36, Halliburton has a price-to -earnings ratio of around 11 and earnings per share of almost $3. A positive dividend yield of nearly 1% has helped the company earn the trust of loyal investors. In my view, the company will continue to grow at a steady pace, opening new frontiers for investment such as the massive market of China. Therefore, I rank Halliburton among the safer stock investments for 2012.

Hot Oil Stocks To Invest In 2014: Transocean Inc.(RIG)

Transocean Ltd. provides offshore contract drilling services for oil and gas wells worldwide. It offers deepwater and harsh environment drilling, oil and gas drilling management, and drilling engineering and drilling project management services. The company also offers well and logistics services. In addition, it engages in oil and gas exploration, development, and production activities primarily in the United States offshore Louisiana and Texas, and in the United Kingdom sector of the North Sea. As of February 10, 2011, the company owned, had partial ownership interests in, and operated 138 mobile offshore drilling units, including 47 high-specification floaters, 25 midwater floaters, 9 high-specification jackups, 54 standard jackups, and 3 other rigs, as well as 1 ultra-deepwater floater and 3 high-specification jackups under construction. Transocean Ltd. was founded in 1953 and is based in Zug, Switzerland.

Advisors' Opinion:
  • [By Daniel Dicker]

    Transocean(RIG). RIG dominates deepwater drilling floaters, but the company is on the verge of drifting into junk bond territory, and it has court cases pending that will define its financial responsibility for the Macondo disaster of last year.

    Still, in 2008 RIG shares traded for $160. Back then oil prices were not much higher than they are today and daily rig rates weren't much different. RIG trades for about $42 a share today.

Hot Oil Stocks To Invest In 2014: ONEOK Partners L.P.(OKS)

ONEOK Partners, L.P. engages in the gathering, processing, storage, and transportation of natural gas in the United States. The company?s Natural Gas Gathering and Processing segment gathers and processes natural gas produced from crude oil and natural gas wells located in the Mid-Continent region; and gathers natural gas in the Williston Basin, which spans portions of Montana and North Dakota, and the Powder River Basin of Wyoming. Its Natural Gas Pipelines segment primarily owns and operates regulated natural gas transmission pipelines, natural gas storage facilities, and natural gas gathering systems for non-processed gas. It also provides interstate natural gas transportation and storage services. This segment?s interstate natural gas pipeline assets transport natural gas through FERC-regulated interstate natural gas pipelines in North Dakota, Minnesota, Wisconsin, Illinois, Indiana, Kentucky, Tennessee, Oklahoma, Texas, and New Mexico. In addition, it transports intra state natural gas through its assets in Oklahoma; and owns underground natural gas storage facilities in Oklahoma, Kansas, and Texas. Its Natural Gas Liquids segment gathers, fractionates, and treats natural gas liquids (NGLs), as well as stores NGL products primarily in Oklahoma, Kansas, and Texas. This segment owns FERC-regulated natural gas liquids gathering and distribution pipelines in Oklahoma, Kansas, Texas, Wyoming, and Colorado; terminal and storage facilities in Missouri, Nebraska, Iowa, and Illinois; and FERC-regulated natural gas liquids distribution and refined petroleum products pipelines in Kansas, Missouri, Nebraska, Iowa, Illinois, and Indiana that connect its Mid-Continent assets with Midwest markets, including Chicago, Illinois. ONEOK Partners GP serves as the general partner of the company. The company was formerly known as Northern Border Partners, L.P. and changed its name to ONEOK Partners, L.P. in May 2006. The company was founded in 1993 and is based in Tulsa, Oklahoma.

Advisors' Opinion:
  • [By Louis Navellier]

    Oneok Partners (NYSE:OKS) is known for gathering, processing, storage and transportation of natural gas in the U.S. OKS has posted more modest gains than others on this list but still is up 10% year to date.

Sunday, August 18, 2013

FirstEnergy to Retire Coal Plants - Analyst Blog

Hot Canadian Companies To Watch In Right Now

FirstEnergy Inc. (FE) in a move to reduce the burden of compliance costs announced its decision to retire two coal-fired plants. The decision comes in the wake of more stringent environmental policies being implemented in the U.S. The plants proposed to be deactivated are situated in the state of Pennsylvania.

Operations at the Hatfield's Ferry Power Station in Masontown and Mitchell Power Station in Courtney will cease on Oct 9, 2013. The lingering weak market prices of electricity also influenced FirstEnergy to shut down these facilities. In 2012, FirstEnergy decided to put the shutters down on nine coal plants.

The combined capacity of Ferry and Mitchell Power Stations was 2,080 megawatts (MW) and accounted for 10% of the company's total generation capacity. However, the facilities are expected to incur about 30% of the projected $925 million regulatory cost, which FirstEnergy was supposed to incur to comply with the Mercury and Air Toxics Standards ("MATS") provisions.

FirstEnergy's consolidated business would not be impacted by these plant retirements as it will still retain a sizeable generation capacity of over 18,000 MW. Moreover, the company will witness some rearrangement in its resource portfolio, which will be either non- or low-emitting, including nuclear, hydro, pumped-storage hydro, natural gas and scrubbed coal units.

Even after the deactivations, FirstEnergy will be well positioned to maintain an effective generation mix of 56% coal, 22% nuclear, 13% renewables and 9% gas/oil.

FirstEnergy has been reacting well to pro-environment legislations over time and intends to further promote clean energy generation. This is evident from the $650 million capital outlay that it has planned for the installation of MATS-related control technology in its existing facilities.

The company expects these ! high-tech environment control equipment will curb nitrogen oxides, sulfur dioxide and mercury emissions by 84%, 95% and 91%, respectively, from 1990 levels. Carbon dioxide emission is estimated to decrease by 20% to 30% from the 1990 level by 2020.

We believe FirstEnergy's encouraging growth prospects will be backed by its significant investments in transmission assets as well as major infrastructure initiatives.

However, the company will have to tread cautiously given the recent Obama Climate Plan which is expected to pose headwinds. The company currently holds a Zacks Rank #3 (Hold).

Other utilities looking good at the moment are Zacks Ranked #2 (Buy) DTE Energy Company (DTE), Entergy Corp. (ETR) and NiSource Inc. (NI).

Saturday, August 17, 2013

Market Wrap for Wednesday, July 24: Stocks Largely Lower ...

Despite a report which showed that new home sales in the U.S. are at a 5-Year high, the stock market was largely lower on Wednesday.

The losses, however, were modest and the Nasdaq actually finished slightly positive on the day. Investors dumped commodities and U.S. Treasuries on the session while the U.S. Dollar rose.

Volume remained well-below 3-month averages despite a spate of earnings reports released on Tuesday after the close and prior to Wednesday's opening bell. Volatility expectations rose on the session despite only small losses for the Dow and S&P 500, which remain near all-time highs.

Related: Earnings Expectations for the Week of July 22

Major Averages

The Dow Jones Industrial Average fell 27 points, or 0.17 percent, to close at 15,541.

The S&P 500 lost around 6 points, or 0.38 percent, to finish at 1,686.

The Nasdaq added less than a point, or 0.01 percent, to 3,580.

New Home Sales

New home sales rose for a third consecutive month in June, up 8.3 percent to 497,000 from 459,000 in the previous month. This came in ahead of consensus estimates which expected new home sales to be 483,000.


Prices for crude oil were lower on Wednesday. At last check, NYMEX crude futures were down around 2 percent to $105.15. Brent contracts had lost 1.26 percent and were last trading at $107.05. Natural gas fell 1.20 percent on the day to $3.70.

Precious metals were also lower on the session. Near the close of equities, COMEX gold futures had lost a little better than 1 percent to $1,319.30 while silver was down 0.86 percent to $20.08. Copper lost 0.44 percent on the day and was last trading at $3.1840.


Long-term U.S. Treasury prices fell sharply on the session. Heading into the closing bell, the iShares Barclays 20+ Year Treasury Bond ETF (NYSE: TLT) was down 1.25 percent to $107.54. The fall in prices pushed yields up on Wednesday.

Yields for U.S. Treasuries were as follo! ws on Wednesday afternoon: The yield on the 2-Year Note was 0.35 percent while the 5-Year Note was yielding 1.38 percent. The 10-Year Note yield was last at 2.58 percent and the 30-Year Bond was yielding 3.65 percent.


The U.S. Dollar was moderately higher on the session. Late in the day, the PowerShares DB US Dollar Index Bullish ETF (NYSE: UUP), which tracks the performance of the greenback versus a basket of foreign currencies, was up 0.41 percent to $22.28.

The closely watched EUR/USD pair fell 0.29 percent on the day. Other movers included the USD/JPY, which rose 0.72 percent and the AUD/USD, which fell better than 1.50 percent.

Related: Earnings Scheduled for July 24, 2013

Volatility and Volume

The CBOE Volatility Index (VIX) rose again on Wednesday despite only modest losses for the S&P 500. Late in the day, the VIX was trading up a little less than 6 percent to 13.38.

Volume remained well below average with around 96.5 million SPDR S&P 500 ETF (NYSE: SPY) shares trading hands compared to a 3-month daily average of 96.5 million.

Stock Movers

Shares of VMWare (NYSE: VMW) had soared around 18 percent heading into the close after the company reported better-than-expected fiscal second-quarter earnings results.

Illumina (NASDAQ: ILMN) jumped more than 10 percent near the close after the company's second-quarter earnings results.

Shares of video game-publisher Electronic Arts (NASDAQ: EA) were up around 8 percent on Wednesday after the company released its fiscal first-quarter earnings results after the closing bell on Tuesday.

Hanesbrands (NYSE: HBI) rose almost 8 percent on the session after the company agreed to acquire Maidenform Brands (NYSE: MFB) for $23.50 per share in cash, or around $575 million. Maidenform shares traded up almost 23 percent on the news.

Harmonic (NASDAQ: HLIT) rose more than 10 percent late in the day after the company's second-quarter results topped Wall Str! eet expec! tations.

Lumber Liquidators (NYSE: LL) after beating quarterly estimates and raising its outlook for fiscal 2013.

Sarepta Therapeutics (NASDAQ: SRPT) lost almost 19 percent on the session after the company said it won't file a NDA for its drug, eteplirsen, until the first half of next year.

Polycom (NASDAQ: PLCM) lost 15 percent after the company's president and CEO resigned after an audit committee found irregularities in his expense submissions.

Broadcom (NASDAQ: BRCM) fell 15 percent after the chip maker's fiscal second-quarter financial results.

Panera Bread (NASDAQ: PNRA) was lower by around 7 percent in the wake of the company's fiscal Q2 results and lowered full-year guidance.

Motorola Solutions (NYSE: MSI) fell almost 7 percent after reporting disappointing quarterly earnings results.

Seagate Technology (NASDAQ: STX) traded down a little more than 2 percent after reporting a 66 percent decline in its fourth-quarter earnings. The stock recouped most of its earlier losses in afternoon trading.

(c) 2013 Benzinga does not provide investment advice. All rights reserved.

Friday, August 16, 2013

Top Biotech Companies To Invest In Right Now

Every quarter, many money managers have to disclose what they've bought and sold, via "13F" filings. Their latest moves can shine a bright light on smart stock picks.

Today let's look at Tocqueville Asset Management, a portfolio manager with a contrarian bent, believing that "the best investment results over time are achieved outside the mainstream consensus" and seeking "undervalued companies that possess long-term earnings power."

The company's reportable stock portfolio totaled $8.8 billion in value as of March 31, 2013.

Interesting developments
So what does Tocqueville's latest quarterly 13F filing tell us? Here are a few interesting details.

The biggest new holdings are The Finish Line�and Aeropostale. Other new holdings of interest include biotech company Exelixis (NASDAQ: EXEL  ) , which received FDA approval last year for its thyroid cancer drug, Cometriq. The drug may also get approved to treat prostate cancer, and the company is looking at treating as many as nine different cancers with it. On the other hand, Cometriq is expensive, and the company's debt has been growing, along with its share count.

Top Biotech Companies To Invest In Right Now: ARIAD Pharmaceuticals Inc.(ARIA)

ARIAD Pharmaceuticals, Inc., a biopharmaceutical company, focuses on the discovery, development, and commercialization of small-molecule drugs for the treatment of cancer. The company?s lead cancer product, ridaforolimus is being studied in multiple clinical trials in patients with various types of cancers, including metastatic sarcomas, breast cancer, endometrial cancer, prostate cancer, and non-small cell lung cancer. Its product pipeline also includes ponatinib, a pan BCR-ABL inhibitor in phase 2 clinical trial for applications in various hematological cancers and solid tumors; and AP26113, an anaplastic lymphoma kinase inhibitor in preclinical studies for the treatment of various cancers, including non-small cell lung cancer, lymphoma, and neuroblastoma. In addition, the company focuses on a drug discovery program centered on small-molecule therapies that are molecularly targeted to cell-signaling pathways implicated in cancer. Further, it licenses its ARGENT cell-sign aling regulation technologies to pharmaceutical and biotechnology companies to develop and commercialize therapeutic products, and to conduct drug discovery research. The company has collaboration and license agreements with Merck & Co., Inc. for the development, manufacture, and commercialization of ridaforolimus; and license agreements with Medinol Ltd. and ICON Medical Corp. to develop and commercialize stents and other medical devices to deliver ridaforolimus to prevent restenosis of injured vessels. ARIAD Pharmaceuticals, Inc. was founded in 1991 and is based in Cambridge, Massachusetts.

Advisors' Opinion:
  • [By CRWE]

    ARIAD Pharmaceuticals, Inc. (NASDAQ:ARIA) reported the initiation of the randomized Phase 3 trial of ponatinib, its investigational pan-BCR-ABL inhibitor, in adult patients with newly diagnosed chronic myeloid leukemia (CML).

  • [By Hilary Kramer]

    Ariad Pharmaceuticals (NASDAQ:ARIA) is developing novel cancer treatments, and it has three promising drugs in its pipeline: ridaforolimus (which I expect to get FDA approval shortly), ponatinib (recently reported good Stage I/II results), and AP-26113 (a compound with strong potential that just started clinical testing). The stock is up nearly 50% since the early October lows, and while concerns over the possibility that Ariad will raise money could be a short-term overhang on the stock, I look for share prices to continue to climb as the company’s drugs move through the approval process.

Top Biotech Companies To Invest In Right Now: OncoGenex Pharmaceuticals Inc.(OGXI)

OncoGenex Pharmaceuticals, Inc., a biopharmaceutical company, engages in the development and commercialization of new cancer therapies that address treatment resistance in cancer patients. The company?s clinical stage products include Custirsen, a phase III clinical stage product for treatment in men with metastatic castrate-resistant prostate cancer; OGX-427, which is in phase II clinical development stage is designed to inhibit heat shock protein 27; and SN2310 that completed phase I stage of clinical development is designed to evaluate safety in patients with advanced cancer. Its pre clinical stage products include GX-225 that is focused on reducing the production of IGFBP-2 and IGFBP-5; and CSP-9222, lead compound from a family of caspase activators. OncoGenex Pharmaceuticals, Inc. is based in Bothell, Washington.

Hot Cheap Companies To Watch In Right Now: Amgen Inc.(AMGN)

Amgen Inc., a biotechnology medicines company, discovers, develops, manufactures, and markets human therapeutics based on advances in cellular and molecular biology for grievous illnesses primarily in the United States, Europe, and Canada. The company markets recombinant protein therapeutics in supportive cancer care, nephrology, and inflammation. Its principal products include Aranesp and EPOGEN erythropoietic-stimulating agents that stimulate the production of red blood cells; Neulasta and NEUPOGEN to stimulate the production of neutrophils, which is a type of white blood cell that helps the body to fight infections; and Enbrel, an inhibitor of tumor necrosis factor that plays a role in the body?s response to inflammatory diseases. The company also markets other products comprising Sensipar/Mimpara, a small molecule calcimimetic that lowers serum calcium levels; Vectibix, a monoclonal antibody that binds specifically to the epidermal growth factor receptor; and Nplate, a thrombopoietin (TPO) receptor agonist that mimics endogenous TPO, the primary driver of platelet production. In addition, it provides Denosumab, a human monoclonal antibody that targets RANKL, an essential regulator of osteoclasts. Further, the company offers product candidates in mid-to-late stage development in a variety of therapeutic areas, including oncology, hematology, inflammation, bone, nephrology, cardiovascular, and general medicine consisting of neurology. It markets its products to healthcare providers, including physicians or their clinics, dialysis centers, hospitals, and pharmacies; consumers; and wholesale distributors of pharmaceutical products. The company has various collaborative arrangements with Pfizer Inc.; GlaxoSmithKline plc; Takeda Pharmaceutical Company Limited; Daiichi Sankyo Company, Limited; Array BioPharma Inc.; Kyowa Hakko Kirin Co. Ltd.; and Cytokinetics, Inc. Amgen Inc. was founded in 1980 and is headquartered in Thousand Oaks, California.

Advisors' Opinion:
  • [By Roberto Pedone]

    Amgen (AMGN) is a biotechnology medicines company. It discovers, develops, manufactures and delivers innovative human therapeutics. This stock closed up 6.8% at $112.40 in Wednesday's trading session.

    Wednesday's Volume: 9.91 million

    Three-Month Average Volume: 3.27 million

    Volume % Change: 189%

    Shares of AMGN ripped higher on Wednesday after news broke that the company is close to a deal to buy Onyx Pharmaceuticals (ONXX) for $130 a share, valuing the deal at around $9.5 billion.

    From a technical perspective, AMGN spiked sharply higher here right above its 50-day moving average of $102.08 with heavy upside volume. This move pushed shares of AMGN into breakout territory, since it took out some near-term overhead resistance levels at $110 to $111.30. Shares of AMGN are now quickly moving within range of triggering another big breakout trade. That trade will hit if AMGN manages to take out Wednesday's high of $113.30 to its 52-week high at $114.95 with high volume.

    Traders should now look for long-biased trades in AMGN as long as it's trending above $110 or $108 and then once it sustains a move or close above those breakout levels with volume that hits near or above 3.27 million shares. If that breakout hits soon, then AMGN will set up to enter new 52-week high territory, which is bullish technical price action. Some possible upside targets off that move are $120 to $125.

  • [By TheStreet Staff]

    The Amgen (AMGN) strategy of returning cash to shareholders in form of share buybacks, Dutch tender offers and dividends is abandoned in favor of ramped up acquisitions i.e. Gilead Sciences buying Pharmasset. Large-cap biotech firms start acting like Big Pharma -- choosing to buy growth instead of seeking it from internal drug development.

  • [By Paul Goodwin]

    For many investors Amgen is considered the biotech stock to own, and one of the very best in this sector. With an international focus and excellent returns this stock is one that many financial advisors own.

Top Biotech Companies To Invest In Right Now: Quintiles Transnational Holdings Inc (Q)

Quintiles Transnational Holdings Inc. is a provider of biopharmaceutical development services and commercial outsourcing services. The Company operates in two segments: Product Development and Integrated Healthcare Services. The Company�� Product Development segment operates as a contract research organization (CRO) focused primarily on Phase II-IV clinical trials and associated laboratory and analytical activities. The Company�� Integrated Healthcare Services segment is a global commercial pharmaceutical sales and service organizations and Integrated Healthcare Services provides a range of services, including commercial services, such as providing contract pharmaceutical sales forces in geographic markets, as well as healthcare business services for the healthcare sector, such as outcome-based and payer and provider services. In August 2012, it acquired Expression Analysis, Inc.

Product Development

Product Development provides services and that allow biopharmaceutical companies to outsource the clinical development process from first in man trials to post-launch monitoring. The Company�� service offering provides the support and functional necessary at each stage of development, as well as the systems and analytical capabilities. Product Development consists of clinical solutions and services and consulting. Clinical solutions and services provides services necessary to develop biopharmaceutical products, including project management and clinical monitoring functions for conducting multi-site trials (generally Phase II-IV) (core clinical) and clinical trial support services that improve clinical trial decision making and include global laboratories, data management, biostatistical, safety and pharmacovigilance, and early clinical development trials, and strategic planning and design services that improve decisions and performance. Consulting provides strategy and management consulting services based on life science and advanced analytics, as well as regulatory and comp! liance consulting services.

The Company competes with Covance, Inc., Pharmaceutical Product Development, Inc., PAREXEL International Corporation, ICON plc, inVentiv Health, Inc. (inVentive), INC Research and PRA International.

Integrated Healthcare Services

Integrated Healthcare Services provides the healthcare industry with both geographic presence and commercial capabilities. The Company�� commercialization services are designed to accelerate the commercial of biopharmaceutical and other health-related products. Service offerings include commercial services (sales representatives, strategy, marketing communications and other areas related to commercialization), outcome research (drug therapy analysis, real-world research and evidence-based medicine, including research studies to prove a drug�� value) and payer and provider services comparative and cost-effectiveness research capabilities, clinical management analytics, decision support services, medication adherence and health outcome optimization services, and Web-based systems for measuring quality improvement.

The Company competes with inVentiv, PDI, Inc., Publicis Selling Solutions, United Drug plc, EPS Corporation and CMIC HOLDINGS Co., Ltd.

Thursday, August 15, 2013

7 factors to be considered for asset allocation

Hot Penny Stocks To Invest In Right Now

Although, equities appear the best investment option to make the most of in a stock market rally, it is not very wise to nest all eggs in one basket. This is sometimes comprehended by people only in conditions of adversity (such as a sharp decline in stock market), when investors have parked a large portion of their corpus in a particular asset class (in this case, equities).

It is vital for you to understand that not all assets move in the same direction at the same time. If equities are witnessing a bear market, it is unlikely that other asset classes such as gold, debt instruments, real estate will also be witnessing a down-turn at the same time or vice-versa.

Hence, it is best to invest in more than one type of instrument to improve your chances of achieving your long-term goals with minimal turbulence. You see, planned asset allocation acts as a shield to protect your wealth during uncertain economic conditions and market volatility.

So how can one really allocate his / hard money wisely?

Well, here are some factors which one must take while you intend to allocate your assets - hard earned money wisely, as they provide a comprehensive picture.

• Age:

Age is an important factor to be considered while deciding asset allocation. If you are a young investor of 20-30 years, one should consider allocating a large percentage of your portfolio in risky assets, such as equities. Being young gives you ample amount of time and opportunities to recover from any possible setbacks in the value of the portfolio.

If you belong to the middle age group (30-55 years), you must aim to create a moderately risky portfolio and should not invest your entire savings in equities.

On the other hand, aged investors, nearing their retirements (55 years & above), should follow a highly conservative approach when planning their asset allocation and prefer debt or fixed income instruments so as to preserve the principal amount.

• Income:

The amount you invest is a function of the amount of income you earn. Any appraisal in earnings, will impact your discretionary income and hence the amount of investment. If you are into service or employment, drawing a fixed salary every month, you can allocate your savings systematically to both risk and safe instruments depending on your age.

However, if you are in the business industry, your profits and losses are not fixed in nature. While higher profits will lead you to expand your business or invest in various financial instruments, a year of losses will have a direct bearing on your ability and capability to invest. Hence, it is imperative for you to allocate your assets keeping in mind your future income growth potential.

• Expenses:

In order to keep your financial health in pink in the long-term, it is important that you live within means and curtail your unnecessary expenses. It is this strategy which will enable you save a large portion of your monthly earnings, which can be deployed in suitable asset classes (depending upon your age, income, risk appetite and nearness to goal).

We recognise that while certain expenses such as loan repayments, rent, grocery bills etc. cannot be avoided; you can always stream line few of your unnecessary and extravagant expenses. This will enable you to increase the net free cash available for asset allocation, which in turn if invested wisely can enable you to create more 'wealth' and fulfil your financial goals.

• Nearness to goal:

Your nearness to your financial goal is also relevant while doing financial planning. If you are many years away from the financial goal, you should ideally allocate maximum allocation to the equity asset class and less towards fixed income instruments.

So, say you have a financial goal of getting your daughter married well after 20 years from now; it would be prudent to invest in equities (either through the direct route or through equity mutual funds) .

It is noteworthy that the concept of allocating funds to different asset classes based on your nearness to goals helps not only to diversify risks across different asset classes but also in rebalancing your portfolio when you are closer (in terms of number of years) to the achievement of your financial goals.

You see, when you are drawing nearer (3 years) to your financial goal(s), you must shift your corpus to fixed income instruments to safeguard and avoid risk asset classes to preclude wealth erosion.

• Risk Appetite:

Your willingness to take risk which is a function of your age, income, expenses, nearness to goal, will be an important determinant while framing your financial plan. So, if your willingness to take risk is high (aggressive), you can skew your portfolio more towards the equity asset class.

Similarly, if your willingness to take risk is relatively low (conservative), your portfolio can be skewed towards fixed income instruments, and if you are a moderate risk taker you can take a mix of equity and debt respectively.

• Liabilities:

If you as an investor have high liabilities, then even though you may be willing to take high amount of risk, your financial condition would make you a risk-averse investor. Irrespective of age, willingness to invest, nearness to his goals, risk tolerance or any other factor, you will be forced to only make safe investments as you cannot afford to let your investments suffer any setbacks due to market swings.

Also, you must avoid taking loans or increasing liabilities to generate funds to invest in risk assets such as equities as any losses endured here might worsen your financials.

• Assets:

As an investor, it is imperative to first analyse your existing portfolio before allocating funds further. For instance, if a huge chunk of your portfolio is dominated by real estate, then you must diversify your assets in a manner that reduces your allocation to risk assets such as real estate or equities and increase investments in safe instruments such as debt and cash. And while you do that be cognisant of the aforementioned facets which we discussed.

Diversification of assets gives you a lee way to counter market uncertainties and acts as a stabiliser for your portfolio when a particular asset class crashes.

Broadly, an effective asset allocation offers the following 4 benefits which are:

1. Lowers investment risk

2. Reduces dependency on single asset class

3. Protects during turbulent times

4. Makes timing the markets irrelevant

Ideal asset allocation:

Under ideal circumstances, Investors whose objective is to achieve long term capital appreciation and have an aggressive risk appetite can invest upto 70 percent in risk assets such as equities and related instruments, and the remaining 30 percent in safer asset classes such as debt and cash instruments.

Moderate Investors, who aim at providing some stability to their portfolio along with capital growth, must invest upto 60 percent in equities and balance (40 percent) in debt and cash.

Conservative Investors', who prioritize the protection of their capital must upto 70 percent in debt and cash, while the rest can be diversified by investing in quality equity instruments. However, before you follow this ideal asset allocation, be cognisant about the aforementioned facets which we discussed.

PersonalFN is of the view that asset allocation safeguards the overall value of your portfolio from the misfortune of any particular asset class. It is not a one-time process and you must keep reviewing your asset allocation from time to time to ensure it is in line to achieve your financial goals .

PersonalFN is a Mumbai based Financial Planning and Mutual Fund Research Firm.

Wednesday, August 14, 2013

Top 10 Value Companies To Buy Right Now

I went out on a limb last week, and now it's time to see how that decision played out.

I predicted that Apple (NASDAQ: AAPL  ) would close higher on the week. The consumer-tech giant was approaching new lows, and it seemed as if the fears of its demise and hype over recently introduced smartphones were overblown. Apple shares benefited from a bullish week of trading, climbing 1.6% on the week. I was right. I predicted that the tech-heavy Nasdaq would outperform the Dow Jones Industrial Average. (DJINDICES: ^DJI  ) . This has been a tricky call lately, so how did it play out this time? Well, the market rallied in a major way this week, with secondary stocks leading the way. The Nasdaq soared 2.8% on the week. The Dow managed to close just 2.1% higher. I was right. My final call was for Apogee (NASDAQ: APOG  ) to beat Wall Street's quarterly profit target. The maker of value-added glass products for the architectural and picture framing industries has been beating Wall Street estimates consistently over the past year. Why should that end? Analysts were looking for a profit of $0.17 a share during the quarter, and it came through with net income of $0.15. I was wrong.

Two out of three? I can do better than that. Let me once again whip out my trusty, dusty, and occasionally accurate crystal ball to make three calls that may play out over the next few trading days.

Top 10 Value Companies To Buy Right Now: Tupperware Corporation(TUP)

Tupperware Brands Corporation operates as a direct seller of various products across a range of brands and categories through an independent sales force. The company engages in the manufacture and sale of kitchen and home products, and beauty and personal care products. It offers preparation, storage, and serving solutions for the kitchen and home, as well as kitchen cookware and tools, children?s educational toys, microwave products, and gifts under the Tupperware brand name primarily in Europe, Africa, the Middle East, the Asia Pacific, and North America. The company provides beauty and personal care products, which include skin care products, cosmetics, bath and body care, toiletries, fragrances, nutritional products, apparel, and related products principally in Mexico, South Africa, the Philippines, Australia, and Uruguay. It offers beauty and personal care products under the Armand Dupree, Avroy Shlain, BeautiControl, Fuller, NaturCare, Nutrimetics, Nuvo, and Swissgar de brand names. The company sells its Tupperware products directly to distributors, directors, managers, and dealers; and beauty products primarily through consultants and directors. As of December 26, 2009, the Tupperware distribution system had approximately 1,800 distributors, 61,300 managers, and 1.3 million dealers; and the sales force representing the Beauty businesses approximately 1.1 million. The company was formerly known as Tupperware Corporation and changed its name to Tupperware Brands Corporation in December 2005. The company was founded in 1996 and is headquartered in Orlando, Florida.

Advisors' Opinion:
  • [By Sam Collins]

    Household name Tupperware Brands Corp. (NYSE:TUP) is a global direct seller of products with multiple brands through an independent sales force of 2.4 million people. Its product line focuses on kitchen storage and serving solutions, as well as personal-care products. Over 60% of sales in 2011 are expected to come from Europe and Asia, and the stock has appeal as an emerging markets story.

    S&P estimates that 2011 earnings will increase to $4.54 versus $3.53 in 2010, and it increased its rating to a “five-star strong buy” with a recently revised 12-month target of $81, up from $73. The 2005 purchase of Sara Lee’s (NYSE:SLE) direct-sales business, which has a high growth rate, should be a long-term benefit. TUP’s annual dividend yield is 1.92%.

    Technically TUP had a pullback following a new high at over $70 and is currently oversold. Buy TUP at the current market price with a trading target of $70, but longer term a much higher target will likely be attained.

Top 10 Value Companies To Buy Right Now: Dollar Tree Inc.(DLTR)

Dollar Tree, Inc. operates discount variety stores in the United States and Canada. Its stores offer merchandise primarily at the fixed price of $1.00. The company operates its stores under the names of Dollar Tree, Deal$, Dollar Tree Deal$, Dollar Giant, and Dollar Bills. Its stores offer consumable merchandise, including candy and food, and health and beauty care, as well as household consumables, such as paper, plastics, household chemicals, in select stores, and frozen and refrigerated food; variety merchandise, which includes toys, durable housewares, gifts, party goods, greeting cards, softlines, and other items; and seasonal goods, such as Easter, Halloween, and Christmas merchandise. As of April 30, 2011, it operated 4,089 stores in 48 states and the District of Columbia, as well as 88 stores in Canada. The company was founded in 1986 and is based in Chesapeake, Virginia.

Advisors' Opinion:
  • [By Sam Collins]

    Dollar Tree (NASDAQ:DLTR) is a leading operator of discount variety stores. The stock has hugged its 50-day moving average since mid-February. But a recent minor revision of earnings for this year by several analysts and the recent market sell-off have resulted in a fall from its high of the year at over $70 to under $66. However, Goldman Sachs (NYSE:GS) increased its price target to $73 from $69.

    Technically DLTR is oversold, according to MACD. A break below its 50-day moving average could result in a pullback to $64, but positions could be taken at the current market price. The trading target for DLTR is $72.

Top 5 Insurance Stocks To Buy For 2014: Schlumberger N.V.(SLB)

Schlumberger Limited, together with its subsidiaries, supplies technology, integrated project management, and information solutions to the oil and gas exploration and production industries worldwide. The company?s Oilfield Services segment provides exploration and production services; wireline technology that offers open-hole and cased-hole services; supplies engineering support, directional-drilling, measurement-while-drilling, and logging-while-drilling services; and testing services. This segment also offers well services; supplies well completion services and equipment; artificial lift; data and consulting services; geo services; and information solutions, such as consulting, software, information management system, and IT infrastructure services that support oil and gas industry. Its WesternGeco segment provides reservoir imaging, monitoring, and development services; and operates data processing centers and multiclient seismic library. This segment also offers variou s services include 3D and time-lapse (4D) seismic surveys to multi-component surveys for delineating prospects and reservoir management. The company?s M-I SWACO segment supplies drilling fluid systems to improve drilling performance; fluid systems and specialty tools to optimize wellbore productivity; production technology solutions to maximize production rates; and environmental solutions that manages waste volumes generated in drilling and production operations. Its Smith Oilfield segment designs, manufactures, and markets drill bits and borehole enlargement tools; and supplies drilling tools and services, tubular, completion services, and other related downhole solutions. The company?s Distribution segment markets pipes, valves, and fittings, as well as mill, safety, and other maintenance products. This segment also provides warehouse management, vendor integration, and inventory management services. Schlumberger Limited was founded in 1927 and is based in Houston, Texas.

Advisors' Opinion:
  • [By Robert Holmes]

     Schlumberger has the most potential upside of any stock in this group of 50 that also makes the firm's Best Ideas list. Analyst Ole Slorer says Schlumberger has "what we consider the most advanced technology portfolio in the industry."

    "Its fundamentals are impressive, with what we think are some of the best field personnel, a pristine service and performance reputation, and leading market share in most of its product lines," Slorer writes.

    Though Slorer's price target is 42% above current levels, his most bullish scenario for Schlumberger over the next year would see shares climb a whopping 116%. On the downside, his most bearish scenario for the company would see shares slide 38% over the next 12 months.

  • [By Rebecca Lipman]

     Together with its subsidiaries, supplies technology, integrated project management, and information solutions to the oil and gas exploration and production industries worldwide. Market cap of $91.49B. EPS growth (5-year CAGR) at 24%. According to Morgan Stanley: "Thanks to an estimated $1 billion investment per year in R&D, Schlumberger has what we consider the most advanced technology portfolio in the industry."

Top 10 Value Companies To Buy Right Now: Caterpillar Inc.(CAT)

Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide. It operates through three lines of businesses: Machinery, Engines, and Financial Products. The Machinery business offers construction, mining, and forestry machinery, including track and wheel tractors, track and wheel loaders, pipelayers, motor graders, wheel tractor-scrapers, track and wheel excavators, backhoe loaders, log skidders, log loaders, off-highway trucks, articulated trucks, paving products, skid steer loaders, underground mining equipment, tunnel boring equipment, and related parts. It also manufactures diesel-electric locomotives; and manufactures and services rail-related products and logistics services for other companies. The Engines business provides diesel, heavy fuel, and natural gas reciprocating engines for Caterpillar machinery, electric power generation systems, marine, petrol eum, construction, industrial, agricultural, and other applications. It offers industrial turbines and turbine-related services for oil and gas, and power generation applications. This business also remanufactures Caterpillar engines, machines, and engine components; and offers remanufacturing services for other companies. The Financial Products business provides retail and wholesale financing alternatives for Caterpillar machinery and engines, solar gas turbines, and other equipment and marine vessels, as well as offers loans and various forms of insurance to customers and dealers. It also offers financing for vehicles, power generation facilities, and marine vessels. The company markets its products directly, as well as through its distribution centers, dealers, and distributors. It was formerly known as Caterpillar Tractor Co. and changed its name to Caterpillar Inc. in 1986. Caterpillar Inc. was founded in 1925 and is headquartered in Peoria, Illinois.

Advisors' Opinion:
  • [By Jim Cramer,TheStreet]

    Caterpillar (CAT) could be a monster in 2011, especially with the integration of Bucyrus International (BUCY), which I think will turn out to be a fantastic acquisition.

    Current earnings-per-share estimates of about $6 are, I think, way too low. I see this stock going to $120 in the next year. Too gutsy? Ask yourself what happens if the United States comes back as a growth nation? Right now almost all of the growth is overseas.

    Still a fantastic mineral play and a terrific call on world growth.

  • [By Ben Levisohn]

    For one day at least, this CAT is not a dog.

    Caterpillar (CAT) has gained 2% to $86.22 today, its largest gain since in a month and the largest gain among the Dow components. The machinery manufacturer has dropped 11% during the past six months, however, as a slowdown in China and cost-cutting at mining companies have hit its shares.


    Susquehanna’s Ted Grace offers reasons for optimism, even as he lowers his 12-month price target to $97 from $104:

    CAT remains Positive rated with 15% upside to our $97 price target and upside-downside of 1.2-to-1 (which, like most of our machinery names, is admittedly shy of the 2-to-1 or better ratio we prefer). Despite our 2014-15 EPS being ~6% below consensus, we view our updated estimates as closer to buyside expectations while noting that consensus appears to embed a low tax rate that explains over half of the variance. While there remains plenty of uncertainty on 2014/15, particularly in mining, we believe CAT shares currently discount reasonable top-line expectations while recent meetings with mgmt suggest potential for structural cost savings that could drive better than expected margins/ incrementals. While difficult to identify discernible catalysts, if CAT’s framework for flat-to-better RI revenue growth in 2014 proves correct (admittedly not assumed in our estimates), this would almost certainly debunk the core of the bear thesis and be meaningfully positive for shares.

    Investors waiting for the stock to actually, you know, rise can take comfort in Caterpillar’s $2.40 dividend per share and its more than $3 per share in buybacks in 2013, Grace says.

    Caterpillar’s 2% gain has trumped the Dow Jones Industrial Average’s 0.04% rise, and United Technology’s (UTX) 0.1% drop, while competitor Deere (DE) has gained 1.9% to $83.22.

Friday, August 9, 2013

Why Ubiquiti Networks Skyrocketed

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of communications networking technologist Ubiquiti Networks (NASDAQ: UBNT  ) soared 23% today after its quarterly results and outlook topped Wall Street expectations.

So what: The stock has soared over the past year on a string of better-than-expected quarters, and today's fourth-quarter results -- adjusted EPS of $0.33 topped estimates by $0.06 -- coupled with upbeat guidance only reinforce that operating momentum. In fact, the 22% revenue jump over the third quarter marks the third consecutive quarter of sequential double-digit top-line growth, suggesting that Ubiquiti is making some pretty rapid market share headway.

Now what: Management now sees first-quarter adjusted EPS of $0.38 to $0.41 on revenue of $116 million to $122 million, well ahead of Wall Street's estimate of just $0.27 and $95.6 million. "Now we are turning our full focus to growth," said founder and CEO Robert Pera. "Our business model, innovative technology and user community are continuing to disrupt incumbents in the networking market." Of course, with the stock now up a whopping 250% over its 52-week lows and trading at a P/E of 30, much of those prospects might already be baked into the price.

The tech world has been thrown into chaos as the biggest titans invade one another's turf. At stake is the future of a trillion-dollar revolution: mobile. To find out which of these giants is set to dominate the next decade, we've created a free report called "Who Will Win the War Between the 5 Biggest Tech Stocks?" Inside, you'll find out which companies are set to dominate and give in-the-know investors an edge. To grab a copy of this report, simply click here -- it's free!

Wednesday, August 7, 2013

Will Microsoft Repeat Vista's Mistake?

Steve Ballmer learned a painful lesson with Vista the hard way. Is Microsoft (NASDAQ: MSFT  ) about to repeat that mistake with the Xbox One?

Microsoft's disappointing Vista operating system was an easy target for Apple attack ads several years ago, but the clunky platform was doomed even before Justin Long and John Hodgman began trading zingers about it.

Customers weren't happy.

"Application compatibility in Vista was not as high as many of our customers would have liked," CEO Steve Ballmer conceded five years ago, more than a year before it was relieved by Windows 7.

"What we have learned is that maybe our customers care a little bit more about compatibility and a little bit less about security," he concluded, believing that customers would eventually come around.

They didn't. Compatibility was too important. Apple was able to take plenty of shots with its attack ads, but Vista's demise was self-inflicted. It was an island.

This brings us to the Xbox One's lack of compatibility with earlier gaming consoles.

Despite packing plenty of bar-raising features, the one thing that could keep buyers back initially is the inability to play Xbox and Xbox 360 games. Sure, there are often obscure titles that don't make the upgrade cut, but by switching to a brand-new Advanced Micro Devices (NYSE: AMD  ) chip architecture we're talking about Xbox and Xbox 360 discs being worthless on the Xbox One. The Wii U and the upcoming PlayStation 4 will all be powered by AMD now.

For now, the big loser here is GameStop (NYSE: GME  ) . The shares tumbled 19% last week, weighed down by the Xbox One news and a ho-hum quarterly report. The video game retailer score juicy margins in its resale business, and Xbox One owners won't be buying a lot of older secondhand games anymore. They will probably be selling their discs, and that will create an inventory glut at your local GameStop that will likely drive prices lower.

Top 10 Heal Care Stocks To Watch Right Now

However, the lack of backward compatibility will naturally also sting Microsoft -- just as it did with Vista. Microsoft argued that time would heal the dissent. Developers would upgrade their applications for Vista, but customers don't usually crave the hassle or additional costs to make something that used to work just fine work again on a new operating system.

To be fair, the Xbox One is considerably cooler than Vista. It better be. Asking gamers to come in with clean slates isn't going to be an easy sell.

Are we ready for the "I'm an Xbox One, I'm a Wii U" attack ads?

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

Tuesday, August 6, 2013

Dow Set to Open Flat After Home Depot Beats the Street

LONDON -- Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average (DJINDICES: ^DJI  ) may open down by a negligible four points this morning, while the S&P 500 (SNPINDEX: ^GSPC  ) may open 2.5 points lower. CNN's Fear & Greed Index has edged down to 90 from yesterday's close of 91.

European markets have retreated from 2008 highs this morning ahead of tomorrow's publication of the minutes of the latest Federal Reserve meeting. In London, the world's largest cruise-ship operator, Carnival, slid 11% after cutting its earnings-per-share guidance for the second half by about 20%, citing lower revenue yields due to ticket discounting and higher costs. As of 7:15 a.m. EDT, the FTSE 100 is up a mere three points, while in Germany the DAX is down 0.4%, with automotive manufacturers among the big fallers, including Daimler AG, down 2.8%, and Volkswagen AG, down 1.8%.

No major economic reports are scheduled for release in the U.S. today, but a number of major retailers are set to report earnings, so investors will be watching these closely, as they may provide clues as to the strength of the economic recovery. Investors may also be cautious ahead of tomorrow's testimony from Fed Chairman Ben Bernanke and the publication of the minutes of the latest Federal Open Market Committee meeting, both of which should clarify the Fed's policy on further stimulus measures.

One share that may be actively traded this morning is Home Depot (NYSE: HD  ) , which is up 4% in premarket trading after reporting first-quarter earnings of $0.83 per share -- more than 22% higher than in the same quarter last year and ahead of analysts' consensus forecast for $0.77 per share. Investors may see a strong recovery in the home improvement retail market as representative of wider economic growth and the improving health of the housing market.

AutoZone also reported earlier this morning, revealing a 5% rise in sales to $2.2 billion and a 16% rise in EPS to $7.27, compared with the same period last year.

Other companies due to report today include Best Buy, Medtronic, Dick's Sporting Goods, Saks, and TJX Companies. Urban Outfitters is down by 2.5% in early trading after missing analysts' sales forecasts in its results last night, despite reporting a 14% increase in overall sales. The retailer earned $0.32 per share for the quarter ended April 30, beating analyst expectations of $0.29 per share, according to a Reuters survey.

Finally, let's not forget that the Dow's daily movements can add up to serious long-term gains. Indeed, Warren Buffett recently wrote, "The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions." If you, like Buffett, are convinced of the long-term power of the Dow, you should read "5 Stocks To Retire On." Your long-term wealth could be transformed, even in this uncertain economy. Simply click here now to download this free, no-obligation report.

Best Stocks To Buy Right Now

Monday, August 5, 2013

Why the Street Should Love Amdocs's Earnings

Although business headlines still tout earnings numbers, many investors have moved past net earnings as a measure of a company's economic output. That's because earnings are very often less trustworthy than cash flow, since earnings are more open to manipulation based on dubious judgment calls.

Earnings' unreliability is one of the reasons Foolish investors often flip straight past the income statement to check the cash flow statement. In general, by taking a close look at the cash moving in and out of the business, you can better understand whether the last batch of earnings brought money into the company, or merely disguised a cash gusher with a pretty headline.

Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on Amdocs (NYSE: DOX  ) , whose recent revenue and earnings are plotted below.

Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. FCF = free cash flow. FY = fiscal year. TTM = trailing 12 months.

Over the past 12 months, Amdocs generated $424.9 million cash while it booked net income of $400.7 million. That means it turned 12.9% of its revenue into FCF. That sounds pretty impressive.

All cash is not equal
Unfortunately, the cash flow statement isn't immune from nonsense, either. That's why it pays to take a close look at the components of cash flow from operations, to make sure that the cash flows are of high quality. What does that mean? To me, it means they need to be real and replicable in the upcoming quarters, rather than being offset by continual cash outflows that don't appear on the income statement (such as major capital expenditures).

For instance, cash flow based on cash net income and adjustments for non-cash income-statement expenses (like depreciation) is generally favorable. An increase in cash flow based on stiffing your suppliers (by increasing accounts payable for the short term) or shortchanging Uncle Sam on taxes will come back to bite investors later. The same goes for decreasing accounts receivable; this is good to see, but it's ordinary in recessionary times, and you can only increase collections so much. Finally, adding stock-based compensation expense back to cash flows is questionable when a company hands out a lot of equity to employees and uses cash in later periods to buy back those shares.

So how does the cash flow at Amdocs look? Take a peek at the chart below, which flags questionable cash flow sources with a red bar.

Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. TTM = trailing 12 months.

When I say "questionable cash flow sources," I mean items such as changes in taxes payable, tax benefits from stock options, and asset sales, among others. That's not to say that companies booking these as sources of cash flow are weak, or are engaging in any sort of wrongdoing, or that everything that comes up questionable in my graph is automatically bad news. But whenever a company is getting more than, say, 10% of its cash from operations from these dubious sources, investors ought to make sure to refer to the filings and dig in.

With questionable cash flows amounting to only 9.1% of operating cash flow, Amdocs's cash flows look clean. Within the questionable cash flow figure plotted in the TTM period above, stock-based compensation and related tax benefits provided the biggest boost, at 7.8% of cash flow from operations. Overall, the biggest drag on FCF came from capital expenditures, which consumed 23.5% of cash from operations.

A Foolish final thought
Most investors don't keep tabs on their companies' cash flow. I think that's a mistake. If you take the time to read past the headlines and crack a filing now and then, you're in a much better position to spot potential trouble early. Better yet, you'll improve your odds of finding the underappreciated home-run stocks that provide the market's best returns.

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We can help you keep tabs on your companies with My Watchlist, our free, personalized stock tracking service.

Add Amdocs to My Watchlist.

Sunday, August 4, 2013

Top 5 Gold Stocks To Own For 2014

As gold prices tumbled during Friday's trading session, precious metals companies were dragged down too, including Goldcorp (NYSE: GG  ) and the gold ETF, the SPDR Gold Trust (NYSEMKT: GLD  ) . Given its recent increase in exposure to gold, Silver Wheaton's (NYSE: SLW  ) inability to escape the slide is not a big surprise. Despite increased signs of global economic instability, gold fell below $1500 for the first time since July 2011.

In the below video, contributor Doug Ehrman discusses the impact of gold prices on the stock, both in the immediate-term and longer-term investment perspective. Silver Wheaton remains one of the strongest plays in the silver market, but recent price action should not be overlooked.

If you are looking for a company whose success is determined by the metals market, but without involving itself in the risks of physically mining the metals, then Silver Wheaton provides a unique play on the future of silver. SLW chooses to finance the mining of silver; it has grown sales and net income every year since 2008, and also has increased competitive advantages over its limited peer group. To learn more about Silver Wheaton, click here now to access The Motley Fool's premium research report on the company.

Top 5 Gold Stocks To Own For 2014: 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.

Top 5 Gold Stocks To Own For 2014: First Majestic Silver Corp.(AG)

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

Advisors' Opinion:
  • [By Sy_Harding]

    First Majestic Silver is one of the purest silver plays on the market. The company owns and operates three primary silver mines in Mexico: La Parrilla, San Martin, and La Encantada.

    Shares of AG have risen more than 60% for the year.

    First Majestic generates 85% of its revenue through the production and sale of silver. The rest of the company's revenue is generated through gold, lead, and zinc.

    First Majestic expects to increase total silver output from its operations to 7.5 million ounces of silver in 2011, and up to 16.0 million ounces by 2014.

  • [By Goodwin]

    The shares closed at $88.19, down $1.1, or 1.23%, on the day. Its market capitalization is $77.08 billion. About the company: Siemens AG manufactures a wide range of industrial and consumer products. The Company builds locomotives, traffic control systems, automotive electronics, and engineers electrical power plants. Siemens also provides public and private communications networks, computers, building control systems, medical equipment, and electrical components. The Company operates worldwide.

Top 5 Value Stocks To Own For 2014: Goldman Sachs Group Inc.(The)

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

Top 5 Gold Stocks To Own For 2014: 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 Mel Daris]

    AngloGold Ashanti (AU), a South African company, is trading for $33 and pays a dividend which yields 3.20%. The stock has an astonishing P/E of 1,015. Its net income totaled $112 million last year, but negative cash flows of $620 million. It holds net tangible assets of $4.3 billion and its balance sheet has not grown nearly as quickly as the other companies on this list. AngloGold has two new mines coming online in Congo and Colombia.

Top 5 Gold Stocks To Own For 2014: 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 Christopher Barker]

    Although I have not shed my long-standing contention that Yamana Gold offers one of the more deeply discounted vehicles for long-term gold exposure, lately my outlook for IAMGOLD has turned particularly bullish. With a looming spin-off of a 10% to 20% stake in the company's reliably profitable Niobec niobium mine, and the recent sale of its interest in a pair of high-cost gold operations in Ghana for $667 million, IAMGOLD finds itself in terrific financial shape to execute an aggressive $1.2 billion expansion imitative at existing operations.

    Considering the $1.6 billion net asset value (after tax) that IAMGOLD recently assessed for the Niobec mine alone, and a presumed hoard of more than $1.2 billion (in cash, cash equivalents, and gold bullion held for investment), at a market capitalization of $6.9 billion I find extreme comfort in the market's resulting valuation for IAMGOLD's 15.2 million ounces of attributable gold reserves.