Saturday, August 25, 2012

Stocks Set to Fall After Disappointing German Bond Sale, Spending Data

U.S. stock futures were set to fall after Germany failed to receive enough bids at a bond auction to meet its target. Futures were also reacting to renewed concerns about a slowdown in China.

U.S. durable goods orders fell 0.7% in October. Personal income rose 0.4%, higher than expectations, and spending rose 0.1%. The government’s September spending estimate was revised up, with 0.7% growth. The personal savings rate rose to 3.5% from 3.3%.

Dow futures fell 97 points to 11,368; S&P 500 futures fell 9.6 points to 1,173.2.

Bank stocks continued their swoon, with Bank of America (BAC) falling another 1.9% in pre-market trading.

Deere & Co. (DE) rose 5.8% after the company posted strong fourth quarter earnings.

Best Stocks To Invest In 2011-12-26-1


Marketing and sales software helps businesses drive profitability through measurable pricing and promotion

ARMONK, N.Y. and SAN MATEO, Calif. , Dec. 8, 2011 (CRWENEWSWIRE) — IBM (NYSE:IBM) and DemandTec (Nasdaq:DMAN) today announced that the two companies have entered into a definitive merger agreement for IBM to acquire DemandTec in an all cash transaction at a price of $13.20 /share, or at a net price of approximately $440 million , after adjusting for cash.

The acquisition of DemandTec will extend IBM’s Smarter Commerce initiative by adding cloud-based price, promotion and other merchandising and marketing analytics to help companies better define the best price points and product mix based on customer buying trends.

Organizations are struggling to meet the demands of rapidly shifting customer buying patterns in the era of mobile and social networks. This new digital marketplace requires companies to be highly responsive to consumer demands on the fly. Whether it’s setting and executing the right pricing strategy or the ability to automatically adjust pricing based on online and offline data, being able to rapidly shift to market changes has become a key competitive advantage for global businesses.

IBM estimates the market opportunity for Smarter Commerce at $20 billion in software alone. Extending these capabilities to the cloud gives organizations immediate access to consumer information, providing instant return on investment.

DemandTec delivers cloud-based analytics software that enables businesses to examine different customer buying scenarios, both online and in-store. As a result, companies can spot trends and shopper insights to make better price, promotion, and assortment decisions that increase revenue and profitability.

By gaining a quick and accurate analysis of consumer trends, for example, a retailer can predict how consumers will respond to a price change before making that critical decision. A brand manager can adjust the marketing mix for a product to better drive sales in the grocery channel. A merchant and supplier can work together to understand how one shopper segment differs from another to craft the best merchandising plan. By understanding shoppers across channels, companies can adapt more quickly to rising customer demands.

“IBM Smarter Commerce is redefining how brands buy, market, sell and service their customers in ways that their customers want,” said Craig Hayman, General Manager of Industry Solutions at IBM. “Bringing science to the art of pricing and promotion is a big part of this strategy, and the combination of DemandTec and IBM will help marketing and sales executives in retail and other industries drive more revenue and increase profitability.”

“DemandTec has unprecedented capability to improve customers’ price and promotion tactics on a stand-alone basis and connect retailers and manufacturers for collaborative planning through the cloud,” said Dan Fishback, President and Chief Executive Officer of DemandTec. “IBM Smarter Commerce is the perfect fit for DemandTec. IBM is the only provider of price and promotion offerings within a rich solution set that supports companies’ buy, market, sell and service processes.”

IBM is a recognized market leader in each of the categories within Smarter Commerce[1], which was launched in March 2011. DemandTec will extend this leadership by enabling companies to use cloud computing services to gain insights about customer merchandising and pricing preferences to better market, sell and deliver the right product at the right place, and at the right price. DemandTec also expands IBM’s Software-as-a Service (SaaS) strategy by adding additional, subscription-based offerings to IBM’s SaaS solutions portfolio.

DemandTec has approximately 450 customers worldwide in retail, consumer products and other industries. Retail industry segments served include grocery, drug, convenience, consumer electronics, office supplies, apparel, department stores, and quick-serve restaurants. Manufacturer segments include fast moving consumer goods categories such as food, beverage, and health & beauty. DemandTec also has a portfolio of 31 patents in the areas of pricing, response analysis, and promotion analysis.

Consistent with IBM’s Smarter Commerce strategy, IBM will continue to support and enhance DemandTec’s technologies and clients while allowing them to take advantage of the broader IBM portfolio. DemandTec will be integrated into IBM’s Software Group, which is a key driver of growth and profitability for IBM.

DemandTec is based in San Mateo, Calif. and has more than 350 employees, with additional offices in Minneapolis, London, Paris, and Bangalore. The acquisition is subject to DemandTec shareholder approval, applicable regulatory clearances and other customary closing conditions. It’s expected to close in the first quarter of 2012.

Cautionary Statement Regarding Forward-Looking Statements

Certain statements in this communication regarding the proposed transaction between IBM and DemandTec, the expected timetable for completing the transaction, benefits and synergies of the transaction, future opportunities for the combined company and products and any other statements regarding IBM and DemandTec’s future expectations, beliefs, goals or prospects constitute forward-looking statements made within the meaning of Section 21E of the Securities Exchange Act of 1934 and (collectively, forward-looking statements). Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” “estimates” and similar expressions) should also be considered forward-looking statements. A number of important factors could cause actual results or events to differ materially from those indicated by such forward-looking statements, including the parties’ ability to consummate the transaction; the conditions to the completion of the transaction, including the receipt of shareholder approval, court approval or the regulatory approvals required for the transaction may not be obtained on the terms expected or on the anticipated schedule; the parties’ ability to meet expectations regarding the timing, completion and accounting and tax treatments of the transaction; the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the arrangement within the expected time-frames or at all and to successfully integrate DemandTec’s operations into those of IBM; such integration may be more difficult, time-consuming or costly than expected; operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) may be greater than expected following the transaction; the retention of certain key employees of DemandTec may be difficult; IBM and DemandTec are subject to intense competition and increased competition is expected in the future; fluctuations in foreign currencies could result in transaction losses and increased expenses; the volatility of the international marketplace; and the other factors described in IBM’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010 and in its most recent quarterly report filed with the SEC, and DemandTec’s Annual Report on Form 10-K for the fiscal year ended February 28, 2011 and in its most recent quarterly report filed with the SEC. IBM and DemandTec assume no obligation to update the information in this communication, except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.

Additional Information and Where to Find It

This communication may be deemed to be solicitation material in respect of the proposed acquisition of DemandTec by IBM. In connection with the proposed acquisition, DemandTec intends to file relevant materials with the SEC, including DemandTec’s proxy statement in preliminary and definitive form. SHAREHOLDERS OF DEMANDTEC ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING DEMANDTEC’S DEFINITIVE PROXY STATEMENT, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders will be able to obtain the documents free of charge at the SEC’s web site, Documents will also be available for free from DemandTec by contacting DemandTec Investor Relations at (650) 645-7103 or Such documents are not currently available.

Participants in Solicitation

IBM and its directors and executive officers, and DemandTec and its directors and executive officers, may be deemed to be participants in the solicitation of proxies from the holders of DemandTec common shares in respect of the proposed transaction. Information about the directors and executive officers of IBM is set forth in the proxy statement for IBM’s 2011 Annual Meeting of Stockholders, which was filed with the SEC on March 7, 2011. Information about the directors and executive officers of DemandTec is set forth in the proxy statement for DemandTec’s 2011 Annual Meeting of Shareholders, which was filed with the SEC on June 24, 2011. Investors may obtain additional information regarding the interest of such participants by reading the definitive proxy statement regarding the acquisition when it becomes available.

Source: DemandTec

Media Contacts:

Steve Milmore
IBM Media Relations

Marc Dietz

[1] “The Forrester Wave: Comprehensive Integration Solutions, Q4 2010″, Forrester Research, Inc., November 9, 2010

“Gartner Magic Quadrant for Marketing Resource Management”, Kimberly Collins, February 1, 2011

“The Forrester Wave: B2C eCommerce Platforms”, Forrester Research, Inc., October 21, 2010

“Gartner Magic Quadrant for Enterprise Content Management”, Mark R. Gilbert, Karen M. Shegda, Kenneth Chin, Gavin Tay, October 13, 2011




Ways To Purchasing Penny Stocks

The simple way to buy Penny Stocks

A penny stock is a stock that trades at a tiny cost typically between one and five dollars. It doesn’t deal in the main market exchanges like the Manhattan Stock Exchange, National organisation of Stocks Dealers Automated Quotation System ( Naz ) or the North American Stock Exchange.

Even though they sell essentially at one dollar, the shares might put on sale for as much as 10 bucks dependent on endorsement and statement. They’re typically traded in tiny exchanges and over the counter markets thru over the counter notice board ( OTCBB ) and pink sheets. There are 2 major habits on the way to buy penny stocks. These are either online or thru brokerages.

With Stock Brokers

Lots of stock consumers depend on agents or stock brokers to act for them. They permit them be conscious of how many stocks they’d like, as of which company, the ticker symbol as well as the market the stock is trading on. A considerable number of agents do not command any commissions. They make their funds dependent on the variance between the offer and the asking value. This difference is named the spread. The bigger the spread, the extra money both the purchaser and his agent make.

The picking of a high-quality stock broker is fundamental. Some brokers simply need to eliminate the stock with no anxious much for the purchaser. One should think about a reliable broker and their charges. An alternative factor to think about is how much one wishes to open an account by them. Diverse brokers also charge for asleep accounts. It is a good idea to also discover if the stock broker you select has any advantages for you. Some banks additionally offer the service of selling and purchasing stocks.

Purchasing Penny Stocks Online

An further system regarding how to buy penny stocks is over the Net. An advantage of trade penny stocks online is that you have fast access when you want to either sell or purchase. This way the purchaser takes the money fast more precisely than calling an agent over the fone and asking them to shut the exchange for you.

To purchase and sell online, one has to sign up and open a trading account. This account should be sponsored from the account holder’s bank. Once the account has cash, the shopper then goes to the Net and stays hunting for trading penny stocks. This is often finished by joining forums or keeping a lookout for latest sites with the aim of publish penny stockmarket dealing.

Testing and Explore

Before exchange stocks, customers need to study on the company they would like to buy stock from. They need to reveal out the market holdings. This may be prepared by multiplying the amount per share by the amount of stocks in the market. This be meant to in addition exhibit how many penny stocks to buy. The more one buys, the more study one has to perform on the firms. Once a consumer understands the system of the best way to purchase penny stocks, they understand how to generate plenty of money simply by trading in the penny market.

Looking to find the best deal on top penny stocks, then visit my website to find the best advice on doubling stocks scam for you.

‘Blink’ Your Way to Profits

If you want to make better trades, why not learn to “blink”?

The kind of “blink” I am speaking of here is a reference to Malcolm Gladwell’s compelling book of the same name. The thesis of the book has never been more applicable than when it’s focused on understanding trading psychology.

Face it, anyone with even a modicum of trading experience is all too familiar with the failure to trust their initial thoughts or instincts on a trade.

Often, we know that we waited too long and that we should have acted faster. We may ask ourselves, “Why didn’t I listen to that voice inside my head and just sell when I had those nice profits?”

If these tales of regret sound familiar to you, rest assured that you are not alone. I suspect that in this most-difficult market year, even the best and the brightest traders have experienced more than their usual share of regret.

Now, ask yourself this question: What do these regrets have in common?

The answer is that in every case, the trader failed to “blink.” Let me explain.

The essence of Gladwell’s thesis is that humans have the ability to gauge what is really important from a very narrow period of experience. He argues that spontaneous decisions are often as good as — or even better than — carefully planned and considered ones.

In the book, Gladwell — who wrote the very influential tome “The Tipping Point,” and is currently on the bestseller list with his 2008 work, “Outliers” — draws on a variety of anecdotes from fields as seemingly varied as science, fine art, advertising, medicine and even popular music to argue for the validity of his ideas.

Gladwell says that when we “blink,” we are essentially thinking without thinking. We do this, he claims, by a process he calls “thin-slicing,” which is the human knack for using limited information to come to our conclusions.

Throwing Darts at The Wall Street Journal

It’s Gladwell’s contention that in an era of easy access to boatloads of data on just about any subject matter, many times people make better decisions with snap judgments than they do with volumes of analysis.

Think about it, how many times have you failed to pull the trigger on a trade that you knew was the right thing to do? How many times have you thought your way out of an initial idea, and later found out that it would have made you a lot of money if only you would have taken action?

I suspect that the failure of so many professional money managers to beat the S&P 500 (SPX) has a lot to do with their failure to “blink.” These very smart people often reason themselves away from a good decision, and/or they let others talk them out of what could be profitable moves.

You have likely heard about those studies that show that monkeys throwing darts at the stock tables in The Wall Street Journal tend to outperform professional money managers. Well, perhaps this is because those managers fail to “blink” — i.e., they effectively outsmarted themselves into a state of paralysis.

Thin-Sliced Profits

Now before we continue, please understand that I am in no way arguing for an unthinking, non-contemplative approach to trading. I am not saying that if you feel like buying a stock, then just buy it without good reason. In fact, I am arguing for the contrary.

You see, when you “blink” you are thinking, and you are thinking with the mind’s unfettered processes. You aren’t clouding your idea that a stock may go up with reams of data that say, historically, in a particular month this stock’s shares have fallen X percent.

What prompted your original idea that a given stock may go up is, in fact, simply the process of “thin-slicing” at work.

Keep in mind, however, that it takes time and a lot of trading expertise to reach the level of competent “thin-slicing.” When seasoned traders “trust their instincts,” what we should really say is that they are “blinking.” In other words, they are going with their initial thoughts, which are based on their cumulative knowledge, their current reading of the markets and their past trading experiences.

Finally, I don’t think you have to accept Gladwell’s theories in full to understand that he’s on to something with respect to trusting your initial judgment. When it comes to making good trades, often your greatest enemy is indecision. That indecision is all too frequently aided and abetted by too much information, information that puts a sense of doubt and distrust into your initial analysis.

So, the next time you feel the impetus of doubt, I recommend you take a split second and “blink.”

Jim Woods is a Senior Editor for To learn more about him, read his bio here.

This Retail Stock is in Deep Trouble

When it comes to stocks, it's unwise to depend on hearsay. A reporter from a media outlet may be relying on dubious sources, or an analyst's conjecture may simply be "thinking out loud." Still, I pay close attention when a report emerges about a company I really know. And I think I have a duty to weigh in if that report doesn't fully explain the issue.   So when I awoke Wednesday morning (Jan. 11) and read an article in the New York Post alleging deep troubles at retailer American Apparel (NYSE: APP), I knew I could make the issue more comprehensible to readers. Here's what's going on... Back in mid-November, I suggested bankruptcy was looking like an increasingly likely outcome due to the company's financial troubles, perhaps as soon as this spring. A lot has happened since then. Shares first began to drift ever-lower as an increasing number of investors realized the company's cash was running out and that the retailer would likely be a "terminal short," which means it's probably going to zero.

But short-sellers began to get nervous in mid-December when it appeared as if sales trends were picking up nicely ahead of the holidays. Sure enough, in the week of Jan. 2, the company announced sales in December spiked a whopping 15% to $56 million compared with the year-ago period. That was not what short-sellers wanted to hear, and their short-covering helped propel the stock up sharply. But shorts should have stayed the course. And for those who haven't sought to short the stock before, this may prove to be an especially fruitful entry point. I base this assumption on theNew York Post article.  What did the Post have to say? The only reason American Apparel saw robust sales strength in recent weeks is due to a decision to heavily utilize Groupon (Nasdaq: GRPN), the group-buying site that offers hefty discounts. This likely means the higher-than-expected sales yielded lower-than-expected profit margins. If the newspaper is correct, and I have no way of verifying it, then this stock is in big trouble. (For the record, the New York Post has broken many scoops and is often the first media outlet to uncover important news in the investment end of the retail sector. They're not always 100% right every time, but I trust their information much more than an anonymous Internet blogger, for example.) For many retailers, heavy promotions to move merchandise are an unfortunate aspect of the trade. But for a company that absolutely needs to generate cash, it can be the worst move to make. That's because lenders want to know that a business can generate the cash needed to meet debt obligations. If a company struggles to do so in the all-important holiday season, then lenders become quite dubious that debt-service obligations will be met in future quarters. We won't know what American Apparel's December quarter results will look like for another month. Prior to the holiday season, the company predicted it would generate $20 million in EBITDA in the quarter. As a point of reference, American Apparel's EBITDA was -$2.3 million in the December 2010 quarter, and the company has never generated more than $4 million in quarterly EBITDA at any point in the past three years. If you connect the dots from the New York Post report, then you can assume American Apparel's EBITDA likely fell far short of its internal targets.   Risks to Consider: The biggest risk is if the report is simply wrong and that American Apparel had a good old-fashioned blow-out quarter devoid of any tricks. This business has so many challenges, especially in terms of its balance sheet, that shares are unlikely to rise much further from here even if this was the case, unless it falls prey to a massive short squeeze. Tips>> This is a tricky play.

BRCD Up 6%: FYQ4 View Beats, Q1 View Tops Estimates

Shares of storage networking equipment vendor Brocade Communications Systems (BRCD) are up 25 cents, or 6%, at $4.73 in late trading after the company reported fiscal Q4 revenue and earnings per share comfortably ahead of estimates, and forecast the current quarter’s results higher as well.

Revenue in the three months ended in October rose a fraction of a percent, year over year, and 9%, quarter over quarter, to $550 million, yielding EPS of 16 cents, excluding some costs.

Analysts had been looking for $527 million and 10 cents a share.

Ethernet product and services revenue rose 12%, quarter over quarter, to $189.2 million. Although ethernet from federal government customers dropped 14%, year over year, it was up 39% from the prior quarter.

CEO Michael Klayko called the quarter’s results “outstanding” and said sales were boosted by shipments of 16 gigabit-per-second fibre channel equipment.

According to a deck of slides on the company’s investor relations Web site, for the current quarter, the company sees revenue in a range of $530 million to $550 million, and non-GAAP EPS of 12 cents to 14 cents. Analysts on average were modeling $535 million and 11 cents.

Brocade’s conference call with analysts will begin at 5:30 pm, Eastern time, and you can catch it here.

Time, Price and an Option’s Profitability

One of the most-frequently asked questions I hear is, “The stock is trading above the strike price of a call option I’ve bought — so why isn’t my option profitable?”

In most cases, if a stock is trading at $55 and you are long call options at the $50 strike, your option will be in-the-money and, thus, valuable whether you want to sell it at market or exercise your right to purchase shares at $50.

Under ideal circumstances, if the stock price has exceeded the option’s exercise price, you’ve become the proud holder of an in-the-money call option that can be exercised for stock or closed directly for a profit.


There are a number of factors that influence an option’s price — volatility is oftentimes a culprit, because the more volatility exists in the broader market (or in a particular sector or in a company’s shares) at a given time, the steeper the option premium you might pay to initiate a trade.

Timing (i.e., when you initiate a trade) of your purchase goes beyond volatility. For example, if you buy a call with a $50 exercise price when the stock is trading at $45, the option should be significantly cheaper than if you buy it when the stock is trading at $52.

Buying an out-of-the-money option, in this case (for example, buying the call option with the $50 strike price, with shares trading at $45), means that you’re projecting the stock will make a dramatic spike during the life of your contract.

Relatively speaking, though, a $5 jump in an actively traded stock might not be considered a dramatic move. But if you’re looking for the stock to move that much in a month, with no potentially positive catalysts on the horizon such as an earnings announcement, what started out as an inexpensive bet might turn into a big loss.


The closer that option is to its expiration date, the less value it has, especially if its prospects of finishing profitably are looking slim. That’s because part of an option’s worth is known as time value (that is, the more time you can give the stock to move, the more valuable the option therefore is).

So, it might be possible for that $45 stock to go up five or more points, but if you expect it to happen in a couple of weeks, you may lose out on this potential upside. However, if you foresee a stock making a 5-point move in the space of six months, you may want to buy a call option that expires nine months from now.

You can always exercise or close your position at any time during the life of the options contract. And frankly, it’s often wise to take advantage of time value and take profits on your trade sooner rather than later, especially if the underlying stock has hit its target trading price.

Yes, it’s possible that the stock might keep going up. But there’s also a chance that it will reverse course and go down before the option expires or the position is closed.

However, if you buy a call option with a $50 strike price while the stock is trading at $52, the option is already in-the-money. And buying in-the-money calls is fine as long as you have time on your side.


But if you buy the call two weeks before it expires, you’re probably not going to make too much of a profit. But if you buy options with significant time left before expiration, you are giving the stock three extra months to make an even-bigger upward move, which would typically make your option profitable.

So, if you buy an in-the-money call and the stock doesn’t have time to make much of a move, your option may be profitable. But depending on how much you paid versus how much upside you were able to capture, you might not be banking an impressive return.

Similarly, if you are holding an option at the $50 call strike and the underlying stock finishes at $49.99, unfortunately it’s “close but no cigar.” Even if the stock manages to finish at $50 or a few cents above it, the option may still expire worthless.

Think of it this way: The call option at the $50 strike gives you the right to buy shares at $50. And if shares are trading at $50 on expiration Friday, your at-the-money option doesn’t give you any edge over other traders who didn’t hold that same option, so that’s why we would say it expired worthless.


You can buy options up to 2 1/2 years before they expire. These are called LEAPS, and they cost a bit more than shorter-term options. (Shorter-term options typically expire in nine months or less). But if you’re looking to profit from a significant stock move, the extra expense for the added probability of profiting may be worth it.

As you can see, the stock price greatly affects the price of the option, but it’s just one of many factors that can impact your trade.

The moral to the story is to get into trades where you can not only recoup your commission costs but also walk away with a profit on top of that. The less you pay and the more the stock moves, the more money you can make. And that’s why we’re all in this game!

Top Stocks For 2011-12-24-6

Cleantech Transit, Inc. (CLNO)

Cleantech Transit Inc. was founded to capitalize on technology advances and manufacturing opportunities in the growing clean energy public transportation sector. The Company has expanded its focus to invest directly in specific green projects. Recognizing the many economic and operational advances of converting wood waste into renewable sources of energy, Cleantech has selected to invest in Phoenix Energy ( This project could benefit the Company’s manufacturing clients worldwide.

Cleantech Transit, Inc. (CLNO) is pleased to announce it has met its funding requirement to secure the Company’s ability to earn in 25% of the 500KW Merced Project.

The Company is in the final stages of closing its initial interest in the Merced Project and is currently working on completing the necessary documentation and expects closing the transaction soon. As previously announced Cleantech has the option to earn up to 40% of the Merced Project and the Company plans to continue to work towards increasing its interest in the Merced Project as they move ahead.

Many combinations of biomass source, process and technology are possible. In general, materials with high moisture content (such as sugar cane) are more suited to biochemical conversion and anaerobic digestion than to other forms of conversion. There are many combination of biomass source; but direct combustion is the most fully developed process.
The main processes for utilizing biomass sources include:
o Direct combustion, usually of solids, in boilers or furnaces
o Gasification via a physical or chemical conversion process to a secondary gaseous fuel, followed by combustion in an engine, boiler or turbine
o Biological conversion, via bacterial anaerobic digestion to methane-rich biogas for use as a gaseous fuel
o Chemical or biochemical conversion to produce methanol, ethanol or other liquid fuels.

For more information about Cleantech Transit, Inc. visit its website

Socket Mobile, Inc. (Nasdaq:SCKT) announced the introduction of a new, low-cost barcode scanner, the Socket Bluetooth� Cordless Hand Scanner� (CHS) Model 7C. The CHS 7C includes many of the performance specifications of other Socket 1D barcode scanners. The entire family of CHS barcode scanners offers users the ability to add rapid and robust barcode scanning to smartphones, tablets, notebooks and desktop computing platforms.

Socket Mobile, Inc. produces mobile computing hardware systems for the business mobility market. It offers a family of mobile handheld computer products, which are designed for the healthcare and hospitality markets, as well as accessory products, such as a back pack to enable direct connections to mobile phone networks using network phone cards and a durable case to provide protection in the event the computer is dropped.

Seven Arts Pictures plc (Nasdaq:SAPX) announced that it has closed an initial funding for two films to be produced by Dark Arts a division of Seven Arts’ affiliate, Esplanade Pictures LLC (”Esplanade”). Esplanade will specialize in producing low-budget genre pictures in Louisiana, building on the strength and resources of its local Seven Arts’ affiliate Seven Arts Pictures Louisiana LLC.

Seven Arts Entertainment Inc. operates as an independent motion picture production and distribution company. It engages in the development, acquisition, financing, production, and licensing of theatrical motion pictures for exhibition in theatrical markets worldwide.

Enzo Biochem, Inc. (ENZ)

Enzo Biochem, Inc., is a growth-oriented integrated life sciences and biotechnology company focused on harnessing biological process to develop research tools, diagnostics and therapeutics, and serves as a provider of test services, including exotic tests, to the medical community. Since ENZ was founded in 1976, their strategic focus has been on the development of enabling technologies in the life sciences field.

Enzo Biochem Inc. recently announced that it has added four highly experienced executives at its Enzo Life Sciences subsidiary to focus on rapidly evolving new pharmaceutical and clinical applications.

The officers, all filling newly created positions, are Bruce Taillon, PhD, as head of global technology business development, John D’Errico, PhD, to lead the commercial merchandising operations, Kara Cannon, as head of global marketing and Paul Munger, PhD, to lead Global Manufacturing.

Over the past two years, Enzo has been engaged in enhancing the Life Sciences subsidiary’s operating performance through added capabilities, greater integration and a more focused product mix. These efforts are all aimed at significantly expanding Enzo’s presence and marketing beyond the traditional academic and research laboratory core to greater penetrate the pharmaceutical and clinical customer base with new and cutting edge platform technologies.

Biotechnology has been considered with respect to two characteristics: obtaining the best catalyst and the best environment. The most effective, stable and convenient form for the biocatalyst is a whole organism. In most cases, this could be some type of microbe like bacterium, yeast, or mold. Originally, these microorganisms were extracted from the natural environment, but today, scientists can genetically alter these into superior organisms. This is a practice that is being carried out by most biological-based industries and is direct result of the close cooperation between technologists and geneticists.

For more information about Enzo Biochem Inc. visit its website:

Athersys, Inc. (Nasdaq:ATHX) announced that Gil Van Bokkelen, Ph.D., Chairman and Chief Executive Officer, will present at the 18th Annual Newsmakers in the Biotech Industry Conference to be held on Friday, October 21, 2011 at 9:00 a.m. Eastern Time at the Millennium Broadway Hotel & Conference Center in New York City.

Athersys, Inc., a biopharmaceutical company, engages in the discovery and development of therapeutic products in various disease areas in the United States. Its product pipeline includes MultiStem, a novel allogeneic approach to stem cell therapy and regenerative medicine for treating a range of diseases.

Where to Find Stocks with Yields Double Those in the U.S.

Last week, I told you about the enormous number of high-yielding stocks abroad. I think the amount of international dividend-payers out there is one of the market's biggest secrets.

If you remember, I told you only 18 profitable U.S. companies were paying yields of more than 12%... compared with 412 abroad. The numbers fluctuate day to day, but the trend is pretty clear.

I've researched this topic for years. And the fact is, foreign companies are simply paying higher yields across the board.


Take a look at the table to the right.

You can see the difference between what we get from U.S. companies and what's available from international companies. Keep in mind I only looked at the common stocks of companies that were profitable in the past year.

Truth is, the stocks in the S&P 500 pay an average yield of just 2.0%. This makes us one of the lowest-yielding markets in the world.

But go abroad, and you find something completely different. No, not every country is a dividend stalwart... but there are a surprising number of markets that more than double the yields found here in the United States.

Compare our 2.0% average yield with what I'm seeing in international markets.

According to Bloomberg, Germany's average yield is 3.6%... Brazil's average yield is 4.1%... the United Kingdom yields 3.4%... Australia yields 4.5%... New Zealand pays 4.4%.

Take a look:

As Judy Sarayan, a fund manager at mega-investment firm Eaton Vance explained in simple terms, "There's a much stronger dividend culture abroad... individual investors play a larger role in those markets, and they have always demanded more dividends."

But there are more reasons to look abroad than just the dividend yields.

In the one-year period between August 2010 and August 2011, the S&P 500 returned 15.9%. This is certainly nothing to sneeze at, but when you look at total performance worldwide, the U.S. market ranked just 36th in the world in that same period.

And during the past five years, the S&P 500 has returned 12.6%. But 34 other countries delivered better stock market returns.

So not only can you find higher yields abroad, but you can also see stronger capital gains.

You see, there's a correlation between economic growth and rising stock prices. The faster the growth, typically the higher the stock market moves. And international markets are where the majority of the world's economic growth is happening.

Look, the United States is unlike any other nation on the planet. It's the largest economy and home to the world's most innovative entrepreneurs. But the simple fact is that the headiest days of our economic growth are behind us.


It's simply the law of large numbers. With an economy in excess of $14 trillion, growing more than a few percent each year is a major undertaking.

In fact, think back about what we've seen in the past few years. The U.S. government has spent trillions in an effort to stimulate the economy. The Federal Reserve has spent trillions more. Interest rates have been slashed to zero.

And yet, the U.S. economy grew just 2.8% in 2010. Not bad, but only good enough to rank us 117th in the world -- between South Africa and Cameroon -- when it comes to annual gross domestic product (GDP) growth.

Qatar topped this list with 16.3% growth. Singapore saw a 14.4% rise in GDP. Panama, 7.5%... South Korea, 6.1%... Poland, 3.8%... even Germany boosted its GDP at a 3.5% annual rate.

Fact is, more and more income investors are realizing that if they want to give themselves the best chance at the "Holy Grail" of investing -- high yields AND rising stock prices -- they need to look at international companies.

> Don't get me wrong -- investing in international dividend-payers isn't a guaranteed winning investment. Nothing ever is. But as I like to say, limiting yourself to only U.S. stocks is like going to a restaurant and limiting your options to just one side of the menu. Sure you can find something you like... but wouldn't you rather see all the options?

What Bristol-Myers Squibb Does With Its Cash

In the quest to find great investments, most investors focus on earnings to gauge a company's financial strength. This is a good start, but earnings can be misleading and incomplete. To get a clearer understanding of a company's ability to earn money and reward you, the shareholder, it's often better to focus on cash flow. In this series, we tear apart a company's cash flow statement to see how much money is truly being earned, and more importantly, what management is doing with that cash.

Step on up, Bristol-Myers Squibb (NYSE: BMY  ) .

The first step in analyzing cash flow is to look at net income. Bristol-Myers Squibb's net income over the last five years has been impressive:






Normalized Net Income $4.5 billion $4.2 billion $3.9 billion $3.1 billion $2.1 billion

Source: S&P Capital IQ. *12 months ended Sept. 30.��������������������������

Next, we add back in a few noncash expenses like the depreciation of assets, and adjust net income for changes in inventory, accounts receivable, and accounts payable -- changes in cash levels that reflect a company either paying its bills, or being paid by customers. This yields a figure called cash from operating activities -- the amount of cash a company generates from doing everyday business.

From there, we subtract capital expenditures, or the amount a company spends acquiring or fixing physical assets. This yields one version of a figure called free cash flow, or the true amount of cash a company has left over for its investors after doing business:






Free Cash Flow $4.5 billion $4.1 billion $3.3 billion $2.8 billion $2.3 billion

Source: S&P Capital IQ. *12 months ended Sept. 30.

Now we know how much cash Bristol-Myers Squibb is really pulling in each year. Next question: What is it doing with that cash?

There are two ways a company can use free cash flow to directly reward shareholders: dividends and share repurchases. Cash not returned to shareholders can either be stashed in the bank, used to invest in other companies, or to pay off debt.

Here's how much Bristol-Myers Squibb has returned to shareholders in recent years:






Dividends $2.2 billion $2.2 billion $2.5 billion $2.5 billion $2.2 billion
Share Repurchases $1.1 billion $0.6 billion -- -- --
Total Returned to Shareholders $3.3 billion $2.8 billion $2.5 billion $2.5 billion $2.2 billion

Source: S&P Capital IQ. *12 months ended Sept. 30.

As you can see, the company has repurchased a decent amount of its own stock. That's caused shares outstanding to fall:






Shares Outstanding (millions) 1,704 1,713 1,974 1,977 1,970

Source: S&P Capital IQ. *12 months ended Sept. 30.

Now, companies tend to be fairly poor at repurchasing their own shares, buying feverishly when shares are expensive and backing away when they're cheap. Does Bristol-Myers Squibb fall into this trap? Let's take a look:

Source: S&P Capital IQ.

Bristol-Myers Squibb has only engaged in share repurchases during two quarters over the last five years, so it's hard to get a good feel for management's buying activity. The two rounds of repurchases did come after shares had rebounded mightily from the recession, but there's simply not enough information to tell whether this was imprudent or not. Given reasonable valuations in relation to earnings and cash flow, these buybacks have likely been a good deal for shareholders.

Finally, I like to look at how dividends have added to total shareholder returns:

Source: S&P Capital IQ.

Over the last five years, Bristol-Myers Squibb shares returned 48%, which drops to 16% without dividends -- not a bad boost to top off already high returns.

To gauge how well a company is doing, keep an eye on the cash. How much a company earns is not as important as how much cash is actually coming in the door, and how much cash is coming in the door isn't as important as what management actually does with that cash. Remember, you, the shareholder, own the company. Are you happy with the way management has used Bristol-Myers Squibb's cash? Sound off in the comment section below.

  • Add Bristol-Myers Squibb to�My Watchlist.

Applied Materials: Cylical Bottom In Jan.?

While the latest earnings report from Applied Materials provided weak guidance, indications that its revenue emaciation could end in January offered a spot of optimism.

Investors clearly were not happy with the company’s results for the fiscal fourth quarter ended in October, released late Wednesday. Shares of Applied Materials (AMAT) had fallen nearly 7%, or 85 cents, to $11.62 at the noon hour.

But Needham Research Analyst Y. Edwin Mok writes:

“Based on a rebound of silicon revenue/orders and the bottoming of display orders, management sounded optimistic that the January quarter will be the cycle bottom for revenue. While the report was disappointing, we believe longer-term investors should buy the stock on the cyclical recovery both in silicon and display, and AMAT’s strengthened position after completion of the Varian acquisition.”

Friday, August 24, 2012

Vertex: Resolutions For The New Year Should Be Shareholder Friendly

A new year brings along its fair share of resolutions. Optimism over fresh starts isn't limited to our own plans to eat better and exercise more. Companies like Vertex Pharmaceuticals (VRTX), which is trading 40% off its summer high, have good reason to want to reboot sentiment in 2012. This past weekend, Vertex took its optimistic case to investors, offering updated 2012 objectives.

Vertex has been a bad investment since its Incivek hepatitis C treatment was approved this past summer, a bit remarkable given it's likely to be the fastest drug to reach blockbuster status in history. Vertex has reported 25,000 patients have been treated with Incivek since its approval, up from 17,000 treated in Q3. With a $50,000 price tag, patient growth is kicking off tremendous cash flow.

In 2012, the company plans to further expand Incivek's reach. It's also going to ramp up thanks to its planned global launch of cystic fibrosis drug Kalydeco, which could see approval as early as April. The market for cystic fibrosis is smaller than hepatitis C, affecting about 70,000 people worldwide. About 3,000 have the mutation Kalydeco targets and current treatment options aren't very compelling. As a result, Vertex won FDA fast track approval for Kalydeco in December. It's likely the treatment will carry a high price tag given the cost of other specialty drugs, which suggests it could eventually add $100-$200 million in annual sales.

Vertex stock struggles haven't been a result of its own stumbles. Instead, its drop is tied to the potential threat from an all oral Hepatitis C therapy, in development by Pharmasset Inc.. Pharmasset was bought by Gilead (GILD) this past fall to strengthen its pipeline. Bristol Meyers (BMY) also reinforced the market opportunity in Hepatitis C with its $2.5 billion acquisition of Inhibitex (INHX), which has a Hepatitis C drug in Phase II.

But Pharmasset isn't alone in developing oral Hepatitis C treatment. Vertex also is working on its own. Data from its Phase I trial may come as early as Q2 with Phase II trials starting shortly after. And that suggests market share losses upon an eventual Gilead product launch may not be as bad as feared. Either way, 2014 - which is the earliest we're likely to see such a competing therapy - remains far enough away to allow Vertex to bank cash and advance other drugs in development.

Vertex saw sales climb from $65 million in Q4 2010 to 659.2 million in Q3, thanks to Incivek. Analysts project an earnings run rate of $4.55 per share in 2012, which means investors are paying only 7.8x 2012 earnings to buy shares. Arguably, its valuation is inappropriate for Incivek and doesn't reflect any potential from Kalydeco or other future programs.

Investors aren't ignoring the valuation, given the stock has rallied from a low of $26.50 in November to over $35 this week. Even so, the stock remains nearly 40% off its summer high heading into what should be a very strong earnings report on February 2nd.

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in VRTX, GILD over the next 72 hours.

Perils of Deflation Call for Long-Term Caution

By Jeff Brown

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Prosperity Piquing Investor Interest in India

In the investment world, there's often so much talk about China in the United States that the tremendous success in India gets short shrift. But business there is booming.

The world's third-fastest growing economy is set to expand by 8.5% this year, the most in the past half-decade. Such rapid growth has compelled the central bank to lift interest rates four times in the past six months.

Compare that with the U.S. Federal Reserve, which has made clear it intends to keep rates low through at least the middle of next year due to limp demand and negligible inflation.

While American consumers are burdened by high levels of debt and joblessness, India's urban middle class and farmers - who have enjoyed a year of ample but not over-abundant rainfall and rising prices - are eager to spend their newfound wealth.

"What we are seeing is a significant and almost dramatic improvement in consumer sentiment," Shubhada Rao, chief economist at Yes Bank Ltd. in Mumbai, told Bloomberg News. "This probably would be the best year as far as a strong revival in consumption is concerned."

Fittingly, such optimism coincides with a time of galas in India that starts with festivals celebrating Ganesh, the elephant god of prosperity, and careens toward Divali, the festival of lights, on Nov. 5. It's a sort of Christmas season, when stores do half of their entire year's sales.

Of course, unlike the holiday seasons of the past two years in the United States, Indians are out in full force.

"We'd expect many of the retailers to be in the region of 25% growth," Kumar Rajagopalan, chief executive officer of the Retailers Association of India, told Bloomberg. "The biggest segment of growth is the middle class."

Maruti Suzuki, which makes half the cars sold in India, will top $7.3 billion in the fiscal year ending March 31, 2011, an all-time high. The head of Hyundai in India also said he's expecting his best sales ever.

"The demand is quite sustainable," Swati Kulkarni, who helps manage $13.3 billion in assets at UTI Asset Management Co. in Mumbai, told Bloomberg. "There is the benefit of changing lifestyle, strong brands and sustainable growth rate."

One major beneficiary of the boom is gold sales, as India is the world's top consumer and the precious metal is the leading choice of gifts for weddings and festivals.

I'm telling you this because we need to recognize that there's more going on in these countries than squiggly lines on a chart going from left to right. I am trying to persuade you to participate in equities that help you take advantage of this growth - and not be paralyzed by the difficulties of unemployment and shrinking home values here in the United States.

For another representation of the difference between job growth in India vs. the stagnant U.S. market consider a Financial Times report last week that Cognizant Technology Solutions Corp. (Nasdaq: CTSH) has 57 recruitment staff in the United States looking for local engineers but is still forced to import Indians on work visas.

"If you look at the core of what we do, the technology work, the U.S. simply does not have the talent base today," Francisco d'Souza, Cognizant president, told FT. "Although unemployment in the U.S. today is high, IT unemployment is still very low."

U.S. universities are producing too few engineers to meet industry demand. About 70% of U.S. Ph.D. students are foreign born. The latest figures show that India's undergraduate schools produce about 600,000 engineers a year, compared with about 84,000 in the United States.

S. Gopalakrishnan, chief executive of Infosys Technologies (Nasdaq: INFY), India's second-largest IT company, told FT that his firm had 10,000 staff in the United States but only 1,600 were U.S. nationals or permanent residents. The company wanted to hire 1,000 people a year in the United States but faced a scarcity of talent.

"It is a struggle," he told the paper.

These are deep, pervasive issues in America. The weak job market has not occurred quickly or by accident, and it has long-term implications for our economy. Until it picks up somehow, we'll continue to look overseas for a large share of our investment growth.

The 10 Fastest-Growing Oil and Gas E&P Stocks

Why are investors willing to pay only 10 times earnings for some stocks, but 20, 50, even 100 times earnings for others?

The short answer: growth. Companies that can grow their earnings meaningfully could make lofty current P/E ratios look cheap in hindsight.

Of course, any company can promise a rosy, growth-rich future. Figuring out which companies can actually deliver is far trickier. In this series, I take the first step by identifying companies that have put up the best growth track records in their respective sectors.

Below, I've listed the top sales growers in oil and gas exploration and production over the last five years. Here's how to interpret each data column.

  • Five-year sales growth: I rank each company's sales growth, to capture its pure trailing expansion without regard to the vagaries of earnings.
  • Five-year EPS growth: Since sales growth means nothing if it doesn't ultimately fall to the bottom line, I've also included each company's five-year trailing EPS growth rate.
  • Five-year analyst estimates: This column shows us how much EPS growth analysts expect over the next five years. Just keep in mind that analysts tend to grossly overestimate a company's prospects.
  • Five-year ROIC range: Return on invested capital basically shows you how efficiently a company is converting its debt and equity into profits. We want companies that can do a lot with a little. By looking at the five-year range, we can start to gauge both the power and the consistency of a company's profit engine.


5-Year Sales Growth

5-Year EPS Growth

5-Year Analyst Estimates

5-Year ROIC Range

Magnum Hunter Resources (NYSE: MHR  ) 320.2% NM N/A (10.7%) / (2.3%)
Contango Oil & Gas (AMEX: MCF  ) 204.7% NM N/A 1.6% / 19.6%
Gran Tierra Energy 156.9% NM 10% (6.1%) / 26.1%
TransAtlantic Petroleum (AMEX: TAT  ) 129.3% NM N/A (23.9%) / (11.1%)
Kodiak Oil & Gas (NYSE: KOG  ) 91.5% NM 43.3% (64.5%) / 1.3%
Linn Energy (Nasdaq: LINE  ) 67.6% (8.6%) 10.8% (3.5%) / 9.8%
Energy XXI (Bermuda) Limited (Nasdaq: EXXI  ) 53.5% 15.5% 10.0% (23.2%) / 10.6%
Legacy Reserves 45.7% NM 6.0% (54.5%) / 47.4%
Gulfport Energy 40.5% 29.2% 34.0% (50.9%) / 16.2%
FX Energy (Nasdaq: FXEN  ) 32.0% NM 300.0% (51.9%) / 2.8%

Source: S&P Capital IQ. NM = not meaningful; EPS growth that is NM results from losses during the period. N/A = not applicable; analyst estimates that are N/A result from lack of analyst coverage.

Use the table above as a first step to help you generate ideas for your own further research. Once you identify stocks worth a closer look, the following three steps will help you further assess their growth prospects:

  • Carefully study the table for possible danger signs, such as high sales growth but low EPS growth, analyst growth expectations significantly trailing past growth, and low ROIC figures. Then follow the trail. For example, a quick scan of the EPS growth rates and the ROIC ranges shows that profitability can wildly fluctuate in this industry, if it's achieved at all.
  • Find out how the company achieved its prior growth: organically, or via acquisition? Can it sustain that previous growth? For example, for Magnum Hunter Resources (our top grower), we see that its growth was achieved off a very small revenue base five years ago. That's why we see such an eye-popping 320% sales growth rate. That's clearly not sustainable, but no company can sustain growth rates higher than 300%.
  • Pay attention to how management plans to implement its growth plans. Does its strategy seem prudent and plausible to you?

Remember: The more profitable, efficient, and predictable growth a company can achieve, the more we investors should be willing to pay.

Learn more about any of the stocks that interest you by adding them to our My Watchlist tool. You'll get access to all the latest Motley Fool analysis, organized by company.

4 Highly Profitable Stocks Near Ex-Dividend Dates

A company's ex-dividend date is the date by which an investor must own the stock to receive the next dividend. If you're interested in dividend income, here are some stocks nearing their ex-dividend date.

We ran a screen on stocks within five trading days of their next ex-dividend date for those with high profitability, beating their industry peers on gross, operating and pretax margins.

It's important to keep in mind however that stocks paying large dividends usually see their stock price rise by the dividend amount nearing the ex-dividend date, and then fall by the dividend amount as the ex-dividend date passes.

?Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.?


Your browser does not support iframes.

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these stocks pay attractive dividends? Use this list as a starting point for your own analysis.

List sorted by dividend yield.

1. Wisconsin Energy Corp. (WEC): Engages in the generation, distribution and sale of electric energy and steam. Dividend yield at 3.46%, payout ratio at 47.15%. Ex-dividend date on 02/08/12, which is one trading day away. TTM gross margin at 27.14% vs. industry average at 26.32%. TTM operating margin at 19.78% vs. industry average at 16.99%. TTM pretax margin at 17.31% vs. industry average at 12.58%.

2. Autoliv, Inc. (ALV): Develops, manufactures and supplies automotive safety systems to the automotive industry. Dividend yield at 2.72%, payout ratio at 24.78%. Ex-dividend date on 02/13/12, which is four trading days away. TTM gross margin at 24.02% vs. industry average at 19.61%. TTM operating margin at 10.92% vs. industry average at 7.5%. TTM pretax margin at 10.06% vs. industry average at 7.01%.

3. East West Bancorp, Inc. (EWBC): Operates as the holding company for East West Bank, which provides a range of personal and commercial banking services to small and medium-sized businesses, business executives, professionals and other individuals in California. Dividend yield at 1.78%, payout ratio at 19.38%. Ex-dividend date on 02/08/12, which is one trading day away. TTM gross margin at 74.99% vs. industry average at 71.33%. TTM operating margin at 51.2% vs. industry average at 40.69%. TTM pretax margin at 35.2% vs. industry average at 22.13%.

4. Twin Disc Inc. (TWIN): Designs, manufactures and sells marine and heavy duty off-highway power transmission equipment. Dividend yield at 1.11%, payout ratio at 13.22%. Ex-dividend date on 02/08/12, which is one trading day away. TTM gross margin at 39.88% vs. industry average at 32.91%. TTM operating margin at 14.47% vs. industry average at 13.26%. TTM pretax margin at 13.99% vs. industry average at 11.14%.

*Ex-dividend dates sourced from Yahoo! Finance, profitability data sourced from Fidelity, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Thursday, August 23, 2012

Bigger Game Plan in Zynga’s Hasbro Deal?

When Zynga (NASDAQ:ZNGA) came public in mid-December, the performance was awful. The stock was priced at $10 and quickly plunged to $8. But then it started to gain momentum, and its price is now $13.32.

One of the catalysts was the Facebook filing, which caused lots of excitement with investors. No wonder: Zynga accounts for 12% of the social network�s revenues.

But something else was happening: buzz about Zynga moving into the virtual gambling business (it looks like states will begin to legalize it).

Great, huh? But it’s not without challenges. First of all, Facebook has shown some signs of slowing. Also in regard to online gambling, this is likely to take a while to play out. It will probably also involve a complex partnership with a traditional casino operator like�MGM (NYSE:MGM), Wynn Resorts (NASDAQ:WYNN) or Las Vegas Sands (NYSE:LVS).

Instead, Zynga needs a way to create more and more cool game titles. Unfortunately, this has been a struggle lately. Consider that there have even been reports that Zynga has been knocking off the games from rivals.

What to do? Well, one approach is to partner with major entertainment companies to create exciting games. Actually, this may be the thinking behind Zynga�s recent arrangement with Hasbro (NYSE:HAS). It’s true that the current deal only calls for merchandising, which is probably a relatively small opportunity. It seems only a few titles — say Farmville, FrontierVille and Castleville — would make for popular dolls and action figures.

Rather, the deal with Hasbro may have broader implications: Zynga could be ready to use Hasbro’s iconic brands in its own games. Hasbro has many of them, such as Pictionary, Risk, Scrabble, Dungeons & Dragons, Trivial Pursuit and Candy Land.

As Zynga grows larger, it’s inevitably getting tougher to innovate. This happened with other game operators like EA (NASDAQ:EA) and Activision Blizzard (NASDAQ:ATVI). So, to remain competitive, these companies have also had to team up with other brands to find growth. Classic examples include Madden NFL and Harry Potter.

The good news is that Zynga is in a strong position to pursue this strategy. After all, it raised a cool $1 billion from its IPO.

Tom Taulli runs the InvestorPlace blog�IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of��The Complete M&A Handbook”,��All About Short Selling��and��All About Commodities.��Follow him on Twitter at�@ttaulli�or reach him via�email. As of this writing, he did not own a position in any of the aforementioned securities.

LPL-AXA Extend Clearing Deal

LPL Financial (LPLA) said Wednesday that it had extended its clearing and custody deal with AXA Advisors, which as more than 5,000 advisors in some 145 offices. The deal began in 2007.  

"We are delighted AXA Advisors has decided to extend their clearing relationship with our firm," said David Akellian, head of Custom Clearing Services for LPL Financial, in a statement.

"Since deciding to use LPL five years ago, our two organizations have worked in partnership to grow the AXA Advisors investment business,” added Akellian, who joined LPL in June 2011 from Stifel Nicholaus’ unit Century Securities Associates, after stints at Merrill Lynch and Pershing.

When Akellian came on board, LPL said it was working with multiple clients, including seven insurance companies and 4,000 of their advisors.

"AXA Advisors' broker dealer platform is a critical component of our retail distribution business," said Christine Nigro, president of AXA Advisors, in a press release. "This renewal is a natural extension of our ongoing efforts to provide clients with an innovative and robust investment platform."

Industry experts note that clearing work can help LPL strengthen its long-term financial results by diversifying its revenues, which it has done not only in clearing, but also in bank distribution and the retirement-plan business, they note.

"This is important business for LPL ... and suggests that they are a successful business-to-business player," said Chip Roame (left), head of Tiburon Strategic Advisors, in an interview. "They have the capacity not only to serve individual reps, who have limited power to make demands of LPL, but also have the ability to satisfy a larger institutional player that will have its own demands."

LPL Financial, which has about 12,800 financial advisors affiliated with its independent broker-dealer operations and some 730 financial institutions as clients nationwide. It reported fourth-quarter earnings late Tuesday that beat last year’s results but missed analysts’ expectations. Profits were $39.4 million, while sales totaled close to $829 million.

The Last Tax Free Cyber Monday?

see photosAFP/Getty Images

Click for full photo gallery: 10 States Aiming To Tax Internet Sales

Americans will spend $37.6 billion buying on-line this holiday season, shelling out $1.2 billion on this coming �Cyber Monday� alone, ComScore Inc. predicts. And on a sizable chunk of those purchases, no state or local sales taxes will be paid.

But some Internet buyers could find this is their last Christmas shopping untaxed.  Most notably, by this time next year,, the Web�s biggest retailer, will almost certainly be collecting sales taxes on purchases shipped to the 37 million plus residents of California. Currently, Amazon only collects taxes on items shipped to Kansas, Kentucky, New York, North Dakota and Washington. But as  part of adeal it struck with California legislators this past September,  it has to start collecting from Golden State residents, too, in September 2012.

Residents of other states could see a change by Christmas 2012 or 2013, depending on what happens in their own state legislatures and in Washington, D.C.  Earlier this month, an unusual bipartisan group of five Republican and five Democratic Senators introduced the Marketplace Fairness Act, a bill which would authorize the 45 states with sales taxes to require Internet merchants doing more than $500,000 a year in sales to collect their taxes for them, so long as the states simplified their sales tax systems.

�I�ve been around long enough and I�ve watched Congress enough to say this is going to happen,�� Sen. Lamar Alexander, (R-TN), one of the sponsors, predicted in a speech on the Senate floor.  He and Sen. Mike Enzi (R-WY), the other prime Republican mover on the bill, are promoting the legislation to their anti-tax colleagues as a matter of states� rights and fairness�not a new tax.

Here, a little background is in order. In 1992, the U.S. Supreme Court ruled in Quill v. North Dakota, that only sellers with a physical presence in a state (�nexus� in taxspeak) can be required to collect that state�s sales taxes. But in finding the Constitution�s commerce clause prevented states, on their own,  from requiring collection of their taxes by remote sellers (in Quill�s case a catalog operation), the Supreme Court also observed that Congress, with its power to regulate interstate commerce, could decide to allow such collection.

In the early days of E-commerce, some big bricks and mortar retailers, including Barnes & Noble, and Wal-Mart, tried to exploit Quill and avoid collecting taxes online by setting up separate corporate entities to sell on the Internet. But after enduring state tax audits and lawsuits�and recognizing the advantage of integrating their online and in-store operations�the big retail chains all started collecting Internet sales taxes on shipments to states where they also have stores.

Note that even if an Internet retailer doesn�t collect the tax, residents of most states still owe �use� (meaning sales) tax on their online purchases. States have tried to prod their residents to voluntarily pay up by putting lines on state income tax forms requesting the uncollected sales tax. But few consumers comply and those who wish to avoid sales taxes on line still have plenty of shopping options, in addition to Amazon.  Among merchants on Internet Retailer�s list of the biggest 50 on-line retailers, for example, collects sales taxes only on items bound for its home state of Utah; only on orders shipped to California and Florida; only on purchases sent to California, New Jersey and Tennessee; and the Gilt Group only on shipments to New York, Kentucky, and Nevada.

Now, with E-commerce taking an ever larger share of  retail sales, traditional bricks and mortar retailers and the states�estimated to be losing anywhere from  $11 billion to $23 billion a year from untaxed Web retail sales� have ramped up their fight to make Internet merchants tow the tax collection line. �It�s now the top priority for the entire retail industry,�� says Jason Brewer,  a vice president of the Retail Industry Leaders Association, whose board includes executives of Wal-Mart, Best Buy, Target,  J.C. Penny and Home Depot.  Even the nation�s largest shopping center operator, Simon Property Group, has gotten into the act, filing suit this month against the state of Indiana in attempt to force Indiana to require sales tax collection by Amazon.

As for the states, spurred on by traditional retailers and their own budget woes, they aren�t all waiting for Congress to act. So far this year, Illinois, California, Connecticut, Arkansas and Vermont have passed laws asserting that an Internet seller has �nexus� and must collect their taxes if it gets sales through marketing affiliates based in their states. (These so-called �Amazon laws� are modeled on a statute New York passed in 2008. Amazon has challenged that law in court� so far unsuccessfully.)  Texas, meanwhile, is pursuing Amazon for $269 million in back sales tax it say the Internet giant should have collected from 2005 through 2009 because it was operating a warehouse in the state. (Amazon is fighting the bill.)

Particularly galling to store merchants, Brewer says, are new smart phone apps which allow a shopper to look at an item in a store, scan the bar code into his or her iPhone, find  it cheaper on the Web and then purchase it on-line�all while still standing in the store. He says stores are often willing to match an online price, just as they�ll match the price from a competing store if a consumer brings in a newspaper advertisement.  But store merchants can�t match the fact that the online item comes without sales tax, Brewer complains.

So would forcing them to collect sales taxes  slow the growth of online retailers, as the big store lobby hopes? ComScore analyst Andrew Lipsman answers that it �may have a dampening effect because it removes one of the most important cost advantages for online retailers.��  But, he adds, �online retailers still have less overhead than brick-and-mortar, so they can usually maintain better prices even with sales tax factored in.�

Deflation Abounds, Bears Abide

The sell-off that began with the Fed’s downbeat economic assessment and underwhelming policy response circled the globe overnight and appears ready to pick up when U.S. markets reopen. What’s stunning is that the plunge has taken in everything from Hong Kong stocks to commodities, with U.S. Treasuries the only safe haven.

European bourses are getting crushed with the Euro Stoxx 50 down a huge 5%. Banks are at the epicenter of the selling, exacerbated by Standard & Poor’s downgrade of Italian banks following the rating agency’s cut in Italy’s sovereign debt. That followed Moody’s downgrade Wednesday of big U.S. banks, in part on the expectation they could expect less support from the government in the future, meaning they might no longer be too big to fail. The Fed’s so-called Operation Twist is seen hampering bank earnings by flattening the yield curve and narrowing banks’ profit margins between the short-term rates they pay and the yields on their assets.

While Europe’s sovereign debt crisis remains an omnipresent source of worry, the key factor is the mounting signs of a global economic slowdown. That was especially apparent in the 3% plunge in South Korea’s Kospi, which was pressured both by the gloomy U.S. outlook and news that China’s manufacturing sector contracted for the third straight month.

The dollar again is sought as a global safe haven while commodities slump, not only actively traded ones such as copper but also other economically vital ones such as coal. Crude oil is down $3.62 at $82.30 a barrel while gold is shedding about $50 at $1755 an ounce. Deflation’s impact also is visible in the Treasury market with yields falling to modern records, 1.77% on the 10-year note and 2.86% for the 30-year bond.

As Barry Ritholtz of Fusion IQ sums it up: “With the Fed out of bullets, traders are now left to their own devices. That means decelerating growth, little in the way of new hiring, and peak profits retreating 15-25%. There is no cavalry coming over the hill, traders are on their own. Next stop [S&P 500] 1100, with 950 as a realistic downside target.”

Still Sticking With Oil

Oil has been moving upwards on a fairly steady basis over the last year or so. All sorts of reasons have been put forth: From a somewhat uneven recovery of the global economy to speculation by bankers, hedge funds, and other various financial entities, including pension and endowment funds, which have “discovered” commodities as an asset class. Providing a backdrop is the seemingly endless dialog about “peak oil”, or, as it might be more correctly named, “peak cheap oil”.

As a fairly long time energy/oil bull, I naturally try to pay close attention to this area. Not just to companies that I may hold, but the oil/gas sector, generally speaking. I recently ran across a couple of articles that would suggest that oil will continue to get more expensive before it gets notably cheaper.

The first piece ran back on April 16 in the Calgary Herald and was picked up by Reuters as well. It seems that auditors in Mexico are urging Pemex to slash reserve estimates at one of its largest flagship projects, the onshore Chicontepec project. It was hoped that the project would compensate for the radically declining production from the offshore Cantrell field.

The auditors want estimates of reserves cut by over 7.5 Billion boe. This is a more than 17% cut of the 43 Billion boe of proved, probable, and possible reserves. Evidently, this project has repeatedly failed to meet production projects. At the end of 2009, Chicontepec was only pumping just over 29k bbl/day, which is less than half of what had been projected at the start of the year. Pemex has scaled by this year’s target to 48k bpd, from an original 176k bpd.

Perhaps readers will recall a similar situation a few years back, when Royal Dutch Shell (RDS.A) was forced to admit that its reserves had been vastly overstated.

This would give credence to those who are suggesting that Mexico will become a net importer of oil as soon as 2015, rather than an exporter (and one of the largest suppliers to the U.S.).

The second piece was from Australia’s Courier Mail, and also appeared on April 16. Interestingly enough, it covered the results of a report by the U.S. Joint Forces Command, which is also predicting an oil supply crunch, but as a result of conditions not typically put forth in the peak oil debate.

Rather than a negative imbalance between supply and demand, based on reserves, this report sees a possibility of an oil shortage as early as 2012, because of a lack of production capability, meaning drilling platforms, engineers, and refining capacity.

To quote from the article:

More ominously, the military predicts a "Peak Oil" scenario - where demand outstrips the world's supply capacity - as soon as 2012.

"By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 million barrels a day."

All in all, I can’t quite seem to convince myself to take my oil-related profits off of the table, at least for now.

Sources: The Calgary Herald
The Courier Mail

Disclosure: Long: Provident Energy Trust (PVX), Statoil (STO), Magellan Midstream Partners (MMP), Kinder Morgan Management (KMR)

Why Operation Twist Is Especially Stupid

The point of Fed portfolio purchases of long-term securities supposedly is to force investors (particularly) banks to shed low-yielding safe assets and buy risky assets instead. It’s particularly pointless under present market conditions. The Fed should read its own Flow of Funds tables.

10-year Treasuries at less than 2% (and 10-year TIPS at around 0% yield) are useless to income investors, that is to say, most of us. They are useful for two groups of investors. The first is banks, who can buy them with no capital outlay and enormous leverage and financing costs of close to zero. The second is investors who want a hedge against deflation. In reports published at, we reviewed the first category here and the second here. Competing with the banks for Treasuries is not going to dissuade them from stocking up; on the contrary, if the Fed has a guaranteed bid, banks will front-run the Fed’s buying program. And the whole exercise stinks of panic, giving deflation-hedgers all the more reason to cling to their Treasury notes.

The fact is that there is no shortage of short-term credit for the economy, because cash-rich corporations are putting out trade credits to their own customers almost as fast as banks are shrinking their commercial and industrial loan book:

(Click charts to expand)

That makes Fed monetary policy largely irrelevant, as explained here.

The problem is that corporations are sitting on tons of cash because they don’t want to invest. Private non-residential fixed investment remains miserably low.

This is the dog that didn’t bark, because it’s comatose. You can’t get a consumer-driven recovery when household balance sheets remain shattered; you can only get an investment-driven recovery. And for that, the US needs investment incentives: lower corporate and capital gains taxes, and regulatory rollback.

Stocks to watch: ABHD very strong chart yesterday and in last month (.30 to 1.05). DMND rebound focus from debacle

Focus list from most recent newsletter at ����20+��LinkedIn's 4Q revenue doubles���DMND up .80 in 23 range....Recall debacle yesterday to 21 range, but steady recovery into the day...��10-20�IRWD up .58 @ 15.67�InPlay: Ironwood Pharma prices 5.25 mln shares at $ 1:41AM EST)���GSVC down 4.05...swift drop following 9am est...���5-10��
  • INSM
UPDATE 1-Insmed to start enrolling on lung drug trial in mid-2012 at Reuters08:39am EST
���3-5��XIDE down .79���
  • CORT
Biotech Stock Mailbag: Corcept Therapeutics, Reader Retorts at TheStreet07:28am EST
  • CPST
Capstone Turbine's CEO Discusses Q3 2012 Results - Earnings Call Transcript at Seeking Alpha02:40am EST
  • CPST
Capstone Turbine Corp Earnings: Margins Expand For Fifth Straight Quarter Wall St. Cheat Sheet05:00pm EST
����ABHD was best overall strength yesterday closing at intraday highs.....highly volatile in last week..
ABHD.OB03:59pm EST1.030.205024.85%536,80
ABHD was�also best chart in 2012 (from .30 to 1.05).12:14pm EST 0.96 0.1350 16.36% 167,131 The story here is ABHD is rapidly growing in Water Fracting-A technology to remove hydrocarbons present in produced water in order to protect and thereby substantially increase the useful life of downstream treatment equipment and technol...ogies including a reverse osmosis system...This technology has the potential to rapidly spread with drilling companies..COO: Smart Sponge Technology is a viable, cost effective technology for de-oiling produced water and protecting more expensive downstream treatment technologies. Through this documented, substantive performance we look forward to a successful expansion into the oil and natural gas energy sector."

In addition, the company is significantly ramping it's contract with Waste Mgmt providing storm water cleanup...
In latter 2011 WM begun the rollout of the company's full-service stormwater solutions in California, Canada and parts of the U.S. Southeast.

Last yr they were selected in top 50 water companies to watch:

"Water tech is quickly becoming an engine for economic development and job growth. With these awards, we strive to identify the companies offering the most promising technologies coming onto the market."The Artemis Project Top 50 serves as a primary resource on the most promising emerging water technology solutions for investors, water equipment and chemical companies, and prospective customers.

Additional viable info can be found at :
Bottom line: Expect this 2012 stunning breakout to extend..Highly debate this stock into lower 1s initially...

�Under 1��NTWK up .06...���Pennies:��BFAR was worst overall call from yesterday mentions..fading all the way back to .07 after runup to .11s
BFAR.PK03:50pm EST0.070.0220.45%1,003,547
��VELA saw an afternoon pickup
VELA.PK03:51pm EST0.05700.00509.62%3,474,260
�HRID worst strength from prior mentions...Notice however it started to firm back at .10 last hr+ ....recall plenty of pr on their otc male enhancement drug......We're going to keep an eye on dips below .10 here closely moving foward....


New home construction starts strong in 2012

NEW YORK (CNNMoney) -- New home construction got off to a strong start for the year, with housing starts and building permits rising in January on a monthly and annual basis -- another sign that the U.S. housing market and broader economy are headed in the right direction.

The Census Bureau reported that housing starts rose to an annual rate of 699,000, up 1.5% from December. Compared to a year ago, housing starts were almost 10% higher.

Building permits, which are less affected by weather than starts, came in at a 676,000 annual rate in January, up 0.7% from the prior month and 19% from a year earlier.

Results were also better than industry expectations. A consensus of industry experts from had forecast starts of 671,000 and permits of 675,000.

Housing completions fell to an annual rate of 530,000 in January, however, a drop of 12% compared to December, but up more than 4% from a year earlier.

"Along with the overall positive tides seen recently in the economy, it looks as if residential building is starting to follow suit," said Mike Lubansky, senior financial analyst at Sageworks. "Although residential building still has a steep hill to climb in order to achieve a full recovery to pre-2007 levels, it does look to be on the right trajectory."

For a full-blown recovery, experts say good news needs to continue out of the job market. So far, the unemployment rate has dropped for five straight months, and now stands at 8.3%, the lowest since February 2009.

Initial claims for unemployment benefits have also been falling. On Thursday, a government report showed that the number of Americans filing for jobless claims plunged to the lowest level in nearly four years.

"Today's data are further proof that the recovery solidified in late 2011, and that momentum has carried forward into 2012," said Gus Faucher, senior economist at PNC Financial Services Group. "More importantly, the likelihood of an even stronger recovery is growing."

He added that a continued pick-up in job growth this year could support faster consumer spending growth and a stronger rebound in housing. But, he added, the financial crisis in Europe remains the largest downside risk.  

Apple: Sprint Paid $20 Billion To Get iPhone? Is It Exclusive?

The Wall Street Journal’s Joann Lublin and Spencer Ante this afternoon report that Sprint-Nextel (S) agreed in advance to purchase 30.5 million units of Apple’s (AAPL) iPhone in order to win the right to carry the device, citing multiple anonymous sources.

The authors say that amounts to a commitment on Sprint’s part of $20 billion over the course of four years.

Apple is expected to unveil the next iPhone at an event at its headquarters tomorrow morning, and Sprint is widely expected to start carrying the device for the first time.

Update: BoyGeniusReport’s Jonathan Geller this afternoon writes in response to the WSJ story that he had already been told, over the course of several weeks, by an “industry contact” who is “incredibly solid” that Sprint will be granted the next iPhone — dubbed the “iPhone 5,” as an “exclusive.” The deal would have Verizon Communications (VZ) and AT&T (T) making due with a lesser model, an “iPhone 4S,” as Geller calls it, for another quarter or so until they are allowed to carry the iPhone 5.

Remarks Geller, “I told my source that even if Sprint paid Apple hundreds of millions, a Sprint iPhone 5 exclusive still would never happen. $20 billion in guaranteed iPhone sales, though? We�ll see tomorrow.

Geller offers a breakdown of what the two devices’ features might include.

Sprint shares closed the day down 31 cents, or 10%, at $2.73 and were unchanged in late trading.

Southwest Sees Strong Demand; Airlines Rising

Southwest Airlines (LUV) posted strong September numbers today, indicating that demand has been robust. The entire sector was trading higher, beating the overall market early. Stocks were also likely trading higher on the strong jobs report, although the price of oil was also significantly higher.

Southwest said that total traffic rose 6.4% in September and its load factor jumped to 77.8% from 75.5% a year ago. Passenger revenue per available seat mile (PRASM) rose an estimated 12%.

Southwest stock was up about 1% in early trading. Delta (DAL) rose 2%.

Wednesday, August 22, 2012

Things You Should Know Before Buying A Smartphone

Acquiring a brand new cell phone is always a thrilling encounter. Not too far back cellphones were primarily used to make and receive calls when on the run. These days, cell phones can perform so many options it’s purely remarkable.

The most popular mobile phone at the moment has turned out to be the pda. One time very costly gadgets and merely utilized by professionals, smart phone prices have lessened and therefore are currently enjoyed by the wider public.

Smartphones aren’t only capable of enabling it’s end users to make and receive cell phone calls, these invaluable gadgets make it easy for it’s users to surf the world wide web, secure important email messages and even video chat. More recently, with the new 4g phones, smartphones are capable of doing far more at unbelievable speeds. The best 4g phone in the marketplace can perform acquiring speeds faster than most land line internet services.

With the various smart phone choices available, how can you tell what cell phone is right for your needs? Or even if you need to have a smartphone for instance. Several consumers shop for the newest smart phone because of all the wonderful things these products are able to do. Astonishingly, the majority of benefits featured on these devices are hardly ever put to use.

Many wireless service providers impose a hefty charge monthly to utilize a smartphone on their own mobile network, thus ensuring you’re ending up with a gadget you’re really going to use is important.

When figuring out if you need to buy a smartphone the very first thing you need to ask yourself is do you really need this device. The most popular use for a pda would be to gain having access to the web and receiving those very important e-mail messages that can’t be missed. If you prefer getting internet access almost everywhere you travel then a smart phone might be a necessity for you.

The next thing you must do before getting a smart phone is decide if are able to afford to pay out the monthly data fees required.

Data plans for most smartphones begin at $29.99. That is certainly a considerable sum of money to pay monthly for a phone that’s not utilized to it’s full potential. This particular economy is difficult, so evaluate the regular monthly price of data plans prior to purchasing the hottest smart phone.

As a final point, make sure you select the right wireless carrier for your address. The majority of cell phone companies declare to own the top cellular network, but their network is merely great where one can receive a signal. Check with your friends and family about the type of services they get using their company cell service providers.

When seeking further information on where to find the best 4g phones to meet your needs, head over to best 4g smartphone. They possess an abundance of information about obtaining the very best mobile phone for your mobile needs.

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5 Hotel and Leisure Stocks In Need of a Vacation

In this down economy wouldn’t you rather take a staycation than a vacation? That’s what millions of Americans have chosen to do in order to cope, and it’s hurting the hotel and leisure industry. I’ve had these leisurely stocks on my sell list for almost all of last year and I’m not taking them off now. If you value the strength of your portfolio, I recommend you do the same.

I watch more than 5,000 publicly traded companies with my Portfolio Grader tool, ranking companies by a number of fundamental and quantitative measures. And this week, five hotel and leisure stocks in need of a vacation.

Here they are, in alphabetical order. Each one of these stocks gets a �D� or �F� according to my research, meaning it is a �sell� or �strong sell.�

Carnival (NYSE:CCL) is an international cruise company that has experience a stock loss of 27% since January 2011. CCL gets a �D� for operating margin growth, a �D� for its ability to exceed the consensus earnings estimates on Wall Street, a �D� for the magnitude in which earnings projections have increased over the past month and a �D� for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of CCL stock. International (NASDAQ:CTRP) helps customers book hotel accommodations, airline tickets and packaged tours in China. CTRP has watched its stock value decrease 49% in the last 12 months, compared to a gain of 6% for the Dow Jones in the same time. CTRP gets a quantitative grade of �F� in my Portfolio Grader tool. For more information, view my complete analysis of CTRP stock.

Hyatt Hotels (NYSE:H) is known for the Hyatt brand of hotels that it runs internationally. H stock is down nearly 16% since last January. H stock gets a �D� for sales growth, a �D� for earnings growth, an �F� for earnings momentum, a �D� for cash flow and a �D� for return on equity in my Portfolio Grader tool. For more information, view my complete analysis of H stock.

Marriott International (NYSE:MAR) is another company that operates hotels across the world. In the last 12 months, MAR is down 19%, compared to gains by the broader markets. MAR gets an �F� for operating margin growth, an �F� for earnings growth, an �F� for earnings momentum and a �D� for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of MAR stock.

Royal Caribbean Cruises (NYSE:RCL) is another major cruise company that has posted a loss of 41% since this time last year. RCL gets an �F� for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of RCL stock.

Get more analysis of these picks and other publicly traded stocks with Louis Navellier�s Portfolio Grader tool, a 100% free stock rating tool that measures both quantitative buying pressure and eight fundamental factors.