Saturday, May 17, 2014

Stock Exchanges Bust Wild Trades in AOL, Let Others Stand

U.S. equity exchanges ruled to bust trades in AOL Inc.(AOL) after shares got a jarring up-and-down ride late on Tuesday.

But the exchanges let stand other wild trades in five widely held stocks, including shares of Nasdaq OMX Group Inc.(NDAQ)

After the closing bell, the exchanges said in alerts that trades made between 3:49 p.m. and 3:51 p.m. Eastern in AOL, Nabors Industries Ltd.(NBR), Lorillard Inc.(LO), Marathon Petroleum Corp.(MPC), and Canadian Natural Resources Ltd(CNQ.T) and Nasdaq clearly erroneous.

Each were subject to brief but big swings on heavy volume before the prices returned to near pre-outburst levels.

NYSE said in an alert at 5:20 p.m. that it will busting AOL trades at or below $33.17 in that window, but let others stand.

Nasdaq, Direct Edge and NYSE Arca later said they will cancel all AOL trades at or below $33.16.

A call to one NYSE spokesperson to explain the discrepancy was not immediately returned.

Tick-by-tick stock charts show that each stock made big moves on heavy volume. AOL's shares were trading near $36.72 before briefly plummeting.


Top Up And Coming Companies To Watch In Right Now





Fannie Mae and Freddie Mac Have a Payment Due

You can call it a bailout, a rakeover - I mean, takeover - or socialism for cash. It's all that and more.

But, whatever you call it, it's not going to last.

The $187.5 billion bailout of Fannie Mae and Freddie Mac back in 2008 was absolutely necessary.

Before you tell me I'm crazy, let me tell you why...

There are no ifs, ands, or buts about it. Forget that Fannie Mae and Freddie Mac caused their own demise - that's another discussion. Once they imploded, they had to be saved for the sake of every American bank, more than a few giant global banks, the U.S. economy, and probably the global economy.

Fannie Mae and Freddie MacTo live and die another day, Fannie and Freddie had to issue senior preferred securities to the U.S. Treasury for bailing them out. The preferreds paid a 10% dividend to the Treasury.

(Remember that Fannie and Freddie don't make mortgages. They buy mortgages from lenders, package them to sell to investors, and guarantee the securities they issue. This all makes them a pretty good investment, so they buy their own stuff by the fistful.)

Of course, there was a problem. Neither could make the payments. So, our government being the generous sort it is, lent Fannie Mae and Freddie Mac money to pay the government. How's that for good business sense?

Well, wouldn't you know it, by 2012, this pair of government-sponsored enterprises were again enterprising and making tons of money.

That's when the Obama administration, never one to miss an opportunity to extract or extort cold hard cash from any wounded-warrior veterans of the economic drain game, changed the rules for being paid back. In August 2012, the Treasury made the dynamic duopolies deliver all their profits to the saviors who bailed them out.

There would be no more piddling 10% dividends - Uncle Sam wanted all their profits. And he got them. To date, Fannie and Freddie have paid the Treasury more than $200 billion. By June, that amount will have risen to an estimated $213 billion.

OK, so they got paid back. We, the taxpayers, got paid back. That's good, that's very good.

So here's what's not very good. We might even call it.... oh, I don't know, bad.

Last Thursday, just as the dumb-ass duo was forking over another $10.2 billion to the Treasury, the Senate Banking Committee, on the same day, lost control of its opportunity to revamp the whole stupid arrangement that gave life to the world's biggest government-sponsored enterprises (aka GSEs). Come to think of it, there are pretty much no other GSEs. Well, there are, but they're "state-owned" entities, some of which are sponsored by communists and socialists. As they say, if the shoe fits... wear it.

But I digress.

And who stopped the reform efforts in the Senate? A few good Democrats, that's who.

You can't blame them. Honest extortion tactics are hard to come by these days.

Don't get me wrong, I don't give a hoot that Fannie Mae and Freddie Mac have to pay back everything they make to the government. I care that this stupid government of ours spends - make that wastes - this money like a drunken sailor.

But that's another discussion.

What's really galling is that these two Frankenstein monsters weren't broken up when they should have and could have been.

Fannie and Freddie's moneymaking ways are about to end. The extortion game is going to turn into another black hole when they stop extorting money themselves. The two are making so much money because they're suing big banks for billions upon billions of losses they incurred on the crappy mortgages they bought from the banks. Fannie and Freddie then packaged this junk into crappy mortgage-backed pools that they themselves bought, which is really what sunk them.

Best Industrial Disributor Stocks To Buy Right Now

When it comes to making the same mistakes again and again, it's not a question of "if," but "when."

The government has to get out of the mortgage business. They got into it during the Great Depression, and it made sense then, for a while. But that's a long, long time ago.

Fannie and Freddie have spent hundreds of millions of dollars paying lobbyists to make sure Congress doesn't take away their GSE stinking badges. They can't pay out money directly anymore. But that doesn't mean they won't be able to down the road when this past little kerfuffle is all forgotten about.

It's extortion all around. And who's the biggest victim of this rakeover? The taxpayers, as usual.

For heaven's sake, the Fannie Mae and Freddie Mac Expressway to Hell has to be derailed before it steam-rolls the economy again.

More from Shah Gilani: The numbers are in, and they're ugly. First-quarter U.S. GDP is only 0.1%, despite the Federal Reserve spending $3.2 trillion to boost the economy. Simply put, the Fed's "growth-buying" scheme is failing...

Sell These 5 Toxic Stocks Before It's Too Late

BALTIMORE (Stockpickr) -- The big indices gave back nearly a full percentage point each on average yesterday, reminding investors that the sideways churn isn't over yet. Just when the broad market was grasping at new highs, it got swatted lower in a move much like the one back at the start of April.

>>5 Big Stocks to Trade for Gains This Summer

That prolonged sideways price action is frustrating, but it's not particularly ominous -- unless you own some toxic names in your portfolio. Frankly, the biggest gains this year haven't come from picking the right stocks; they've come from not owning the wrong ones.

Today, we're taking a closer look at five large-cap names that look toxic in May.

Just to be clear, the companies I'm talking about today aren't exactly junk. By that, I mean they're not next up in line at bankruptcy court. But that's frankly irrelevant; from a technical analysis standpoint, sellers are shoving around these toxic stocks right now. For that reason, fundamental investors need to decide how long they're willing to take the pain if they want to hold onto these firms in the weeks and months ahead. And for investors looking to buy one of these positions, it makes sense to wait for more favorable technical conditions (and a lower share price) before piling in.

>>5 Stocks Insiders Love Right Now

For the unfamiliar, technical analysis is a way for investors to quantify qualitative factors, such as investor psychology, based on a stock's price action and trends. Once the domain of cloistered trading teams on Wall Street, technicals can help top traders make consistently profitable trades and can aid fundamental investors in better planning their stock execution.

So without further ado, let's take a look at five toxic stocks you should be unloading.

PowerShares QQQ Trust

First up is "The Qs": the PowerShares QQQ Teust (QQQ), a $40 billion ETF that tracks the performance of the Nasdaq 100 Index. QQQ has been a popular trading vehicle for the last couple of years, primarily because it's tracked the Nasdaq's performance during a span where high-momentum tech names have worked really well. But since March, the opposite has been true, and this ETF has corrected to the tune of 5%.

Materially lower ground could be in the cards now, thanks to a classical bearish setup in shares. Here's what to look out for.

QQQ is currently forming a textbook head and shoulders top, a bearish reversal pattern that indicates exhaustion among buyers. The setup is formed by two swing highs that top out at approximately the same level (the shoulders), separated by a higher high (the head). The sell signal comes on a move through QQQ's neckline, which is right at $84. Put more simply, if QQQ can't catch a bid above $84, it becomes a sell.

It's important to remember that this stock's setup is conditional. It doesn't become toxic until that $84 neckline gets violated. In the meantime, this big index ETF has ample opportunities to change its course. That said, investors should at least be keeping a close eye on that $84 level in May. If shares break down though it, look out below.


$12 billion engineering services firm Fluor (FLR) is another name that's looking toxic in May. In fact, shares have been forming a bearish price setup since all the way back in January, making it a longer-term trade with equally long-term trading implications when it triggers. That means FLR could be in store for a pretty rough summer.

Fluor is currently forming a descending triangle setup, a bearish trade that's formed by horizontal support below shares (in this case at $74), and downtrending resistance to the topside. Basically, as FLR bounces in between those two technically-significant price levels, it's getting squeezed closer and closer to a breakdown below that $74 price floor. When that happens, it's time to be a seller.

Momentum, measured by 14-day RSI, adds some extra evidence to Fluor's downside setup. Our momentum gauge has been making lower highs going all the way back to last September. Since momentum is a leading indicator of price, that doesn't bode well for FLR's longs right now.


We're seeing the exact same setup in shares of FedEx (FDX). After rallying more than 38% amid strength in the transports sector, a descending triangle is indicating that FDX might be getting ready to roll over. The support level to watch is $130 – if FedEx breaks down below it, it's time to sell the shipping giant.

Why the significance at $130? Whenever you're looking at any technical price pattern, it's critical to keep buyers and sellers in mind. Patterns like head and shoulders setups and descending triangles are a good way to quickly describe what's going on in a stock, but they're not the reason it's tradable. Instead, it all comes down to supply and demand for shares.

That horizontal $130 support level in FDX is the spot where there's previously been an excess of demand for shares; in other words, it's a price where buyers have been more eager to step in and buy shares at a lower price than sellers were to sell. That's what makes a breakdown below support so significant -- the move means that sellers are finally strong enough to absorb all of the excess demand at the at price level.

For the best risk/reward tradeoff, wait for the next move lower before selling FDX.

Agilent Technologies

You don't have to be an expert technical trader to figure out what's going on in shares of measurement equipment manufacturer Agilent Technologies (A); this chart is about as simple as they get. Agilent is currently forming a textbook downtrending channel, and that makes this a toxic name in May.

The setup is formed by a pair of parallel trend lines: a resistance line above shares, and a support line below them. Those two lines on the chart provide traders with the high-probability range for Agilent's shares to stay within. When it comes to trend channels, up is good and down is bad; it's really as simple as that. And with shares moving lower off of trend line resistance for a fourth time since January, now's the time to sell this toxic stock.

Another indicator, relative strength (not to be confused with RSI), is the side signal that's pointing to downside in Agilent in May. Relative strength has been trending lower since February, indicating that this $18 billion stock is continually underperforming the broad market this year.


Last up is Walgreen (WAG), a name that's shown investors some outstanding performance this past year. In the trailing 12 months, Walgreen has rallied more than 39%, outperforming the S&P 500 by more than double. But after climbing higher for so long, WAG is starting to look "toppy" this month. Here's how to trade it.

Walgreen is currently forming a double top setup, a bearish reversal pattern that looks just like it sounds. The double top is formed by a pair of swing highs that max out at approximately the same price level. The sell signal comes when the trough that separates the two highs gets violated. For WAG, that breakdown level is right at $62.50, a price level that shares are moving back down toward this week.

Like the other conditional trades on this list, until the breakdown below $62.50 happens, downside isn't a high probability trade -- yet. When and if $62.50 gets taken out, though, you'll want to be a seller. If you decide to short WAG on the break, keep a protective stop at the 50-day moving average.

To see this week's trades in action, check out the Toxic Stocks portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.


>>3 Stocks Breaking Out on Big Volume

>>5 Rocket Stocks to Beat a Sideways Market

>>5 Tech Stocks Entering Breakout Mode

Follow Stockpickr on Twitter and become a fan on Facebook.

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

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to

TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Follow Jonas on Twitter @JonasElmerraji

Thursday, May 15, 2014

Big Day for Green Mountain and Some Ugliness From Elizabeth Arden

What's the best way to share your enthusiasm for stocks reaching new records? "Primp" your dog to look like a panda. (It's the cool thing to do in China right now, according to the New York Post. Seriously.) The Dow Jones Industrial Average (DJINDICES: ^DJI  ) (DJINDICES: ^DJI  ) gained 20 points Tuesday, touching a new all-time high midday.
1. Cosmetics giant Elizabeth Arden delivers ugly earnings
It's too bad you can't put some foundation and blush on a corporate earnings report to make it look better. That's what the cosmetics chemists over at makeup giant Elizabeth Arden (NASDAQ: RDEN  ) wish they had done after the stock fell 22.8% Tuesday following its unattractive earnings report -- revenue fell 20% last quarter to $210.8 million, well below the $256.9 million Wall Street expected.

Unlike everyone's favorite model, Heidi Klum, Elizabeth Arden struggled all across Planet Earth to kick off 2014. In North America, sales fell 23% as the company launched fewer fragrances than usual and dealt with the brutal winter weather deterring beauty-seeking consumers. And despite Arden's presence in 120 countries worldwide, international sales fell 16% after management "strategically decides" to reduce its shipments to avoid giving out brand-hurting discounts at the end of the season.

The takeaway is that Elizabeth Arden is trying to get picked up like it's on a corporate date. Just last month, Household Health & Care announced that it was interested in purchasing Arden. So during the earnings report, the company tried to please investors by mentioning that it's working with Goldman Sachs, as if the bank is a matchmaker, to explore "strategic options" for its future.
2. Green Mountain Coffee Roasters enjoys some Coke love
It was a caffeine surge for Keurig Green Mountain (NASDAQ: GMCR  ) after soda giant Coca-Cola (NYSE: KO  ) announced Tuesday it will buy millions more shares of the K-Cup coffee company. Coke's big buy is driving up Green Mountain's share price, which neared an all-time high after the huge endorsement, gaining 7.6%.
The biggest global brand can't get enough of the coffee company. After taking a 10% stake in the company this February, Coca-Cola is doubling down on its bet that Keurig coffee can be the growth engine it needs. Suddenly, Green Mountain shares are the hottest thing in Vermont since the Purple's Pleasure sandwich hit the college town of Middlebury.
The next frontier for Green Mountain will be a single-cup Keurig soda maker. As the company takes on Israel-based SodaStream (NASDAQ: SODA  ) in its own market, it will be good to have the biggest soda company in the world supporting it. Coca-Cola will be the biggest owner of the company, with 16% of the shares.
Remember that soda sales dropped globally this past quarter for Coke for the first time since 1999 (thanks, juice cleanse trend), so investors are craving growth from healthier beverage options. One part of the answer is Green Mountain -- it's been an awesome stock for years, growing to a $20 billion company as the single-cup coffee revolution has swept America, one Keurig machine at a time.
  As originally published on  

Warren Buffett just bought nearly 9 million shares of this company
Imagine a company that rents a very specific and valuable piece of machinery for $41,000 per hour. (That's almost as much as the average American makes in a year!) And Warren Buffett is so confident in this company's can't-live-without-it business model, he just loaded up on 8.8 million shares. An exclusive, brand-new Motley Fool report details this company that already has over 50% market share. Just click here to discover more about this industry-leading stock, and join Buffett in his quest for a veritable landslide of profits!

Wednesday, May 14, 2014

Top 5 China Stocks To Invest In 2015

Top 5 China Stocks To Invest In 2015: KongZhong Corporation(KONG)

KongZhong Corporation, together with its subsidiaries, provides wireless interactive entertainment, media, and community services to mobile phone users in the People's Republic of China. It also involves in the development, distribution, and marketing of consumer wireless value-added services, including wireless application protocol, multimedia messaging services, short messaging services, interactive voice response services, and color ring back tones. In addition, it offers interactive entertainment services, such as mobile games, pictures, karaoke, electronic books, mobile phone personalization features, entertainment news, chat, and message boards; and through offer news, community services, games, and other interactive media and entertainment services; and sells advertising space in the form of text-link, banner, and button advertisements. Further, the company develops and publishes mobile games, including downloadable mobile games and online mobile games cons isting of action, role-playing, and leisure games. As of December 31, 2009, it had a library of approximately 300 internally developed mobile games. Additionally, it develops online games; and provides consulting and technology services, as well as media and net book services. The company was formerly known as Communication Over The Air Inc. and changed its name to KongZhong Corporation in March 2004. KongZhong Corporation was founded in 2002 and is headquartered in Beijing, the People?s Republic of China

Advisors' Opinion:
  • [By Jake L'Ecuyer]

    Top losers in the sector included China Unicom (Hong Kong) (NYSE: CHU), off 4.5 percent, and Kongzhong (NASDAQ: KONG), down 4.7 percent.

    Top Headline
    The Boeing Company (NYSE: BA) reported better-than-expected first-quarter profit. Boeing's quarterly profit declined to $965 million,! or $1.28 per share, from a year-ago profit of $1.11 billion, or $1.44 per share. Its adjusted earnings surged to $1.76 per share compared to $1.73 per share. Its revenue climbed to $20.47 billion versus $18.89 billion. However, analysts were projecting earnings of $1.57 per share on revenue of $20.24 billion. For the full year, Boeing expects adjusted earnings of $7.15 to $7.35 per share.

  • [By Roberto Pedone]

    One under-$10 wireless services player that looks poised for a big spike higher is KongZhong (KONG), which is a provider of WVAS and mobile games to mobile phone users and a wireless media company providing news, content, community and mobile advertising services through its wireless Internet sites in the PRC. This stock is off to a hot start in 2013, with shares up sharply by 53%.

    If you take a look at the chart for KongZhong, you'll notice that this stock has been downtrending badly for the last two months, with shares plunging lower from its high of $14.92 to its recent low of $7.78 a share. During that downtrend, shares of KONG have been consistently making lower highs and lower lows, which is bearish technical price action. That move has now pushed shares of KONG into oversold territory, since its current relative strength index reading is 30.21. Shares of KONG are now starting to spike higher off its recent low of $7.78 a share and off its 200-day moving average of $7.95 a share. This spike could be signaling that the downside volatility for KONG is over in the short-term and the stock is ready to trend higher.

    Traders should now look for long-biased trades in KONG if it manages to break out above some near-term overhead resistance at $8.50 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 519,857 shares. If that breakout triggers soon, then KONG will set up to re-test or possibly take out its next major overhead resistance levels at $10 to its 50-day mov! ing avera! ge at $11.33 a share.

    Traders can look to buy KONG off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support at $7.78 a share. One can also buy KONG off strength once it takes out $8.50 a share with volume and then simply use a stop that sits a comfortable percentage from your entry point.

  • [By Seth Jayson]

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

  • source from Top Stocks Blog:

Tuesday, May 13, 2014

3 Stocks Breaking Out on Unusual Volume

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

>>5 Stocks Set to Soar on Bullish Earnings

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

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

>>5 Stocks Ready to Break Out

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

Susser Petroleum Partners

Susser Petroleum Partners (SUSP), is engaged in the wholesale distribution of motor fuels primarily in Texas, New Mexico, Oklahoma and Louisiana. This stock closed up 3.2% to $43.89 in Monday's trading session.

Monday's Volume: 217,000

Three-Month Average Volume: 85,098

Volume % Change: 222%

From a technical perspective, SUSP jumped higher here right above some near-term support levels at $42 to $41.50 with above-average volume. This spike higher on Monday is starting to push shares of SUSP within range of triggering a near-term breakout trade. That trade will hit if SUSP manages to clear Monday's high of $44 to some more near-term overhead resistance at $45 with high volume.

Traders should now look for long-biased trades in SUSP as long as it's trending above support at $42 or t $41.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 85,098 shares. If that breakout materializes soon, then SUSP will set up to re-test or possibly take out its next major overhead resistance level at its 52-week high of $47.93.

Tal Education Group

Tal Education Group (XRS), together with its subsidiaries, provides K-12 after-school tutoring services under the Xueersi brand name in China. This stock closed up 8.6% to $25.16 in Monday's trading session.

Monday's Volume: 955,000

Three-Month Average Volume: 380,100

Volume % Change: 183%

From a technical perspective, XRS exploded higher here right off its 50-day moving average of $25.21 with heavy upside volume. This move pushed shares of XRS into breakout territory, since the stock took out some near-term overhead resistance levels at $23.95 to $25.06. This spike higher on Monday is now quickly pushing shares of XRS within range of triggering another big breakout trade. That trade will hit XRS manages to take out some more key near-term overhead resistance levels at $25.90 to $25.98 and then once it clears its 52-week high of $26.58 with high volume.

Traders should now look for long-biased trades in XRS as long as it's trending above its 50-day at $22.95 or above more near-term support at $22.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 380,100 shares. If that breakout gets underway soon, then XRS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $30 to $35.

Piper Jaffray Companies

Piper Jaffray Companies (PJC) provides investment banking, institutional brokerage, asset management and related financial services in the U.S. and Europe. This stock closed up 4.5% at $44.99 in Monday's trading session.

Monday's Volume: 309,000

Three-Month Average Volume: 100,635

Volume % Change: 213%

From a technical perspective, PJC spiked notably higher here right off its 50-day moving average of $43.36 with above-average volume. This move is quickly pushing shares of PJC within range of triggering a major breakout trade. That trade will hit if PJC manages to take out some key near-term overhead resistance levels at $45.80 to its 52-week high of $47.43 with high volume.

Traders should now look for long-biased trades in PJC as long as it's trending above its 50-day at $43.36 or above more near-term support near $42 and then once it sustains a move or close above those breakout levels with volume that's near or above 100,635 shares. If that breakout begins soon, then PJC will set up to enter new 52-week-high territory above $47.43, which is bullish technical price action. Some possible upside targets off that breakout are $50 to $55, or even 60.

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

-- Written by Roberto Pedone in Delafield, Wis.


>>5 Rocket Stocks to Beat a Sideways Market

>>Sell These 5 Toxic Stocks Now

>>5 Stocks Under $10 Set to Soar

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.

Trading on Earnings Surprises? Don't Bet on It

NEW YORK (TheStreet) -- In their new book, Clash of the Financial Pundits, Josh Brown and Jeff Macke unravel some of the contradictions inherent in the practice of financial punditry. One of their interview subjects, investor and CNBC commentator Karen Finerman, engages the topic incisively, asking not just rhetorically whether punditry should entertain or "help people."

Delving into the world of financial media, it doesn't take much imagination for me to see the historical link between sports news coverage and televised financial debates. The testosterone-fueled, hyper-energetic pace of panel discussions on CNBC and Fox Business owes its inspiration to the high-energy, pre-game "shout fests" on ESPN.

Despite a mountain of academic and practical evidence that discredits trading strategies based solely on quarterly profit surprises, financial television networks continue to preview corporate results by asking pundits whether investors should buy particular stocks before their earnings are reported. The underlying premise of these on-air discussions is that stocks will rally on news of positive earnings surprises, just as assuredly as sports fans will cheer when their favorite teams win.

Top 5 Services Stocks To Watch Right Now

Market experts might advise investors to buy a stock ahead of quarterly earnings. That presents two risks. Viewers must first believe that the pundits whose advice they heed have the ability to forecast company earnings with greater precision than the consensus of Wall Street analysts. (After all, if a company were to report an "in-line" quarter, that would hardly be deemed newsworthy or be expected to move a company's stock.) Wall Street analysts' earnings forecasts often prove inaccurate. The crowd-sourcing website Estimize, which draws profit estimates from a wide range of professional and non-professional investors, claims to produce earnings projections that are more accurate than the "sell side" consensus about 70% of the time. Given that fact, are you inclined to trust the predictive powers of a single guest on CNBC more than the prevailing wisdom on Wall Street, or the "wisdom of the crowd" on Estimize? Professional investors might sometimes choose to trade based on the expected outcome of a quarter, but it's probably not prudent for most individual investors to take a flyer in this way. The "buy ahead of the quarter?" question implicitly assumes that stocks will rally in the wake of positive earnings surprises, and retreat on news of earnings disappointments. However, the underlying reality, based on both academic evidence and practical experience, is far more muddled. Academic studies should give investors pause before they decide to act reflexively in anticipation of, or in the immediate wake of, an earnings surprise or disappointment. One such study, co-authored by a professor at Villanova University, concludes that "determining the earnings surprise subset" from a group of stocks "does not add value." Another academic study from the University of Michigan concludes that growth stocks, which appear to react more dramatically to negative earnings surprises than value stocks, owe their inferior performance to "earnings-related news" that is disseminated during the month leading up to quarterly announcement dates. These professors conclude that "little of the return differential" between growth and value stocks is "observed at the formal earnings announcement date."

Having spent 20 years forecasting company earnings for a living, I can understand the tendency to fixate on favorable and negative earnings surprises as though they were "winning" or "losing" scores in an athletic competition. However, the underlying reality is more complex.

A positive earnings surprise might push a stock higher -- if the earnings announcement contains information that changes the market's expectations about the company's long-term profit growth rate or returns on capital, or if its alters the market's perception of the relative risks associated with the company's future earnings performance.

This notion -- that the stock price impact of earnings surprises is uncertain -- is more nuanced than the near-certain reaction of viewers to the outcome of sporting events, the winners and losers of which can easily be identified by their final "scores."

For stocks, parsing between winners and losers is a more complex undertaking. Of course, as Josh Brown, Jeff Macke, and their colleagues accurately observe, nuance and complexity make for bad financial television. >>Read More: What's Yahoo! Really Worth Once Alibaba Is Gone? >>Read More: Pershing's Ackman Seeks to Rally Allergan Investors >>Read More: Credit Suisse Accused of Illegal Tax Dodge, CEO Dougan Urged to Resign >>Read More: IBM Investor Briefing: What Wall Street's Saying At the time of publication, the author held no positions in any of the stocks mentioned. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Monday, May 12, 2014

Wolff: Passing the torch at 'Vanity Fair'

Print may be dying, and most magazine and newspaper editor in chief jobs are only memories of the power and influence they once conferred. Except for one, still commanding the obeisance of the high and mighty. That job, held now for more than two decades by among the most crafty and astute players in modern media, will likely soon be open — and, as befits the last grand job in general interest publishing, sought after by pretty much everybody in the industry.

To be the editor of Vanity Fair is less a job than a role, performed for the last 22 years by Graydon Carter. As magazines have gone into dramatic decline, Carter has maintained the illusion that he is arbiter, style master, power broker, host with the most, and absolute king of his publishing domain. Carter turns 65 in July and, while without a formal announcement of his retirement after 22 years, seems to be taking valedictory bows everywhere, most recently at his induction a few weeks ago into the Magazine Editor's Hall of Fame, a career topper.

I've written for Vanity Fair for many years. But, like most people in the VF court, while I have access to rumors, and practice reading tea leaves, I've no more certainty about Carter's plans than anyone else. Cosseted by a protective entourage, he has long cultivated both mystery and hauteur. (Before my first Vanity Fair party, a minion called to make sure I understood that "at these events, Graydon doesn't like to speak to the writers.")

There are those at Conde Nast, Vanity Fair's parent, who believe at this point Carter deserves the job for life. And many others who believe he would take it, but for his own canny sense of power and its natural drift and certain mutations — and desire to go out on top.

S.I. Newhouse, Conde Nast's presiding shareholder and Carter's patron, is 86 and all but retired. Chuck Townsend, the company's operating head, is 69 and in his final months (whether that is 6 or 12 or 18 is shrouded in secrecy — both Townsend and Carter have contracts provi! ding for their leave taking and for generous payouts).

Causing more uncertainty, Conde Nast International, encompassing all the company's foreign editions and once the poor relative of the U.S. company, is now much larger and more profitable than the American operation. (Vanity Fair Italy, in which Carter has no involvement, is nearly as large as the U.S. edition.) What's more, the fear in the U.S. is that the international company, based in London and run by Newhouse family scion Jonathan Newhouse, will export its proudly lean ethos to still-fat New York, where Vanity Fair yet remains the most pampered title.

Carter too, over his last few years of frequent vacations and short office days, has openly built himself a retirement future as proprietor of three restaurants in Manhattan.

And the magazine itself, with its growing nostalgia — e.g., its Monica Lewinsky story in the current issue — seems to edge dangerously older.

Still, it is not an easy separation. Vanity Fair is as much a personal power base for Carter as it is a business for which he is mere steward. VF's influence in Hollywood derives in part from Carter's two decades of building alliances there. (VF writers covering stars and other show business power brokers are often asked by Carter to apply "the courtesy brush.")

The internal push-pull is not only about who will actually name the next editor but what version of Conde Nast and of Vanity Fair should the next editor reflect. Has Conde Nast's idea of the imperial editorship, of which Carter is among the last and largest embodiments, outlived its day? (Office tale: at a VF party, Carter upbraids a young fact checker for drunkenly knocking entourage member Fran Lebowitz, telling her not to return to work. To which the fact checker replies: "You can't fire me — you would have to know my name to do that.")

Vogue editor in chief Anna Wintour, the other remaining imperial editor — recently elevated, to Carter's vexation, to larger management du! ties at C! onde Nast — has been telling people that she will pick the next VF editor. That, reportedly, has inclined Carter, like a Supreme Court justice, to consider delaying his retirement. But the rise of London as ultimate power center means the decision about who gets the $3 million a year job, with its myriad other emoluments, will likely be most influenced from there.

There are four names that are said to regularly form the shortlist of successors. Two are closely connected to Vogue House, the Conde Nast HQ in Hanover Square in London:

Geordie Greig is the former editor of Tatler, the British society magazine, owned by Conde Nast — and the launch pad of former VF editor Tina Brown — and now the editor of the powerful Mail on Sunday. Greig combines high taste, writing a book on Lucian Freud, and tabloid sensibility, recently breaking the story of former prime minister Tony Blair's relationship with Wendi Murdoch before her divorce from Rupert Murdoch — a story Vanity Fair then pursued.

Dylan Jones edits British GQ (I am a contributor) — a 300-page monthly produced with a fraction of VF's staff — which he's turned into a significant chronicler of the UK power scene, as well as one of the most successful luxury and fashion titles. Jones, is also the impresario of the annual GQ Man of the Year Awards, an event that comes close in celebrity power and complex curation to the annual Vanity Fair Oscar party.

One is a long-time Brit in New York:

Johanna Coles, the editor of Cosmopolitan, has become something of the new, improved, kinder and gentler Tina Brown and Anna Wintour rolled into one, with an ever-rising public profile, a talent for high and low— Cosmo won its first National Magazine Award earlier this month — and a strong position on women's issues.

The other is from Hollywood:

Janice Min is the editor of The Hollywood Reporter, saving it from practical oblivion and reinventing it as among the most important publications, second arguably only to Van! ity Fair,! in the entertainment business.

In some sense it is, of course, a highly equivocal passing of the torch, from one of the greatest successes in magazines to one with a wholly existential future. On the other hand, if there is to be a future and a form for magazines,Vanity Fair is not a bad platform from which to stage it.

Once, at an idea meeting in the months after the financial meltdown, Carter and I agreed that I would write a piece titled "The End of Everything." Leaving the building, I shortly began to receive urgent messages from Carter's office to call the boss ASAP. "While it may be the end of everything, just to be sure we're on the same page," Carter said, with growing ardor. "There will always be monthly magazines!"

Sunday, May 11, 2014

Top 10 Cheapest Stocks For 2015

If you're feeling good about the market, you're not alone. Take my hand as we go over some of this week's more uplifting headlines.

1. Chrome wasn't billed in a day
Google (NASDAQ: GOOG  ) is aggressively expanding its Chromebook retail presence.

The online search giant behind the largely web-based Chrome operating system announced that it would be tripling the number of stores stocking its entry-level laptops.

Chromebook laptops were introduced into 2,800 Wal-Mart superstores and 1,500 Staples office supply stores this week, pushing the number of stores selling the laptops to 6,600 physical store locations.

Google has done a good job of teaming up with its hardware partners to promote Chromebook systems online, but when one considers the true appeal of the $199 Acer Chromebook, it's hard to beat being stocked at the country's largest retailer. It will be the cheapest laptop selling at Wal-Mart, and that's going to make it stand out given the nature of many buck-stretching Wal-Mart shoppers.

Top 10 Cheapest Stocks For 2015: El Paso Pipeline Partners LP (EPB)

El Paso Pipeline Partners, L.P. engages in the ownership and operation of natural gas transportation pipelines and storage assets in the United States. The company holds a 100% interest in Wyoming Interstate Company, Ltd. (WIC), an interstate pipeline transportation company located in Wyoming, Utah, and Colorado. It operates approximately 800-mile WIC interstate natural gas pipeline system with a design capacity of approximately 3.5 billion cubic feet per day. The company also owns a 58% general partner interest in Colorado Interstate Gas Company, which operates an interstate natural gas pipeline system with approximately 4,300 miles of pipeline with a design capacity of approximately 4.6 billion cubic feet per day; and associated storage facilities with 37 billion cubic feet of underground working natural gas storage capacity. In addition, it owns a 60% general partner interest in Southern Natural Gas Company that operates an interstate natural gas pipeline system with ap proximately 7,600 miles of pipeline with a design capacity of approximately 3.7 billion cubic feet per day; and associated storage facilities with a total of approximately 60 billion cubic feet of underground working natural gas storage capacity. Further, the company owns interests in Elba Express Company, L.L.C., which operates an approximately 200-mile pipeline with a design capacity of 945 million cubic feet per day; and Southern LNG Company, L.L.C. that owns a liquefied natural gas receiving terminal with a storage capacity of 11.5 equivalent billion cubic feet. It serves natural gas distribution and industrial companies, electric generation companies, natural gas producers, other natural gas pipeline companies, and natural gas marketing and trading companies. El Paso Pipeline GP Company, L.L.C. serves as the general partner of the company. The company was founded in 2007 and is based in Houston, Texas. El Paso Pipeline Partners, L.P. is a subsidiary of El Paso Pipeline LP Holdings, L.L.C.

Advisors' Opinion:
  • [By Dimitra DeFotis]

    Kinder Morgan’s corporate structure is convoluted.�Kinder Morgan� is the general partner, which reaps distributions from underlying businesses. It pays a 4.2% yield. �Kinder Morgan Energy Partners,�the main pipeline MLP enterprise, �pays a 6.5% yield in the form of a cash distribution like most MLPs. �Kinder Morgan Management�(KMR) was created to pay distributions in shares given the tax-and-accounting headaches of MLPs. But KMR still offers tax deferrals. Following an acquisition, Kinder also controls�El Paso Pipeline Partners�(EPB), whose yield is 5.7%. Kinder’s chief financial officer said that the enterprises could be combined at some point. Post from the industry’s biggest conference in May�here.

  • [By Aimee Duffy]

    Kinder Morgan Energy Partners (NYSE: KMP  ) had a great plan to convert some natural gas pipelines owned by El Paso Pipeline Partners (NYSE: EPB  ) into a crude oil system that would feed California refiners with West Texas crude. It looked like a win-win situation; after all, what refiner wouldn't want to replace expensive foreign imports with the cheap, homegrown stuff?

  • [By Robert Rapier]

    To review, Kinder Morgan is the general partner of Kinder Morgan Energy Partners and El Paso Pipeline Partners (NYSE: EPB). Shares/units of KMI, KMP, and EPB have all performed poorly this year relative to competitors, but mostly this is a result of a recent sell-off. The sell-off was prompted by a growth slowdown at KMP and halt of distribution increases at EPB, which was blamed on two adverse rate rulings for different segments of El Paso’s system. This has been extrapolated to a permanent slowdown at KMI, which we believe to be unwarranted.

  • [By WilliamBriat]

    On September 17, Magellan Midstream Partners L.P. (NYSE: MMP) and El Paso Pipeline Partners, L.P. (NYSE: EPB) touched three-month lows while oil was still spiking near a two-year high.

Top 10 Cheapest Stocks For 2015: Muenchener Rueckversicherungs Gesellschaft AG in Muenchen (MUV2)

Muenchener Rueckversicherungs Gesellschaft AG in Muenchen is a Germany-based holding company engaged in reinsurance and insurance business fields. The Company diversifies its operations into reinsurance, primary insurance, Munich Health and Asset management. The Reinsurance business comprises five divisions: Life; Europe and Latin America; Germany, Asia Pacific and Africa; Special and Financial Risks, and Global Clients and North America. The business covers a range of products from traditional reinsurance products to solutions for risk assumption. The Company's primary insurance activities are combined into the ERGO Insurance Group (ERGO) and offers direct insurance, life, property-casualty, health, legal expenses and travel insurance products. It covers the Company's international health reinsurance business and health primary insurance outside Germany and engages the risk management services. The Asset management business handles the investment activities of Munich Re and ERGO. Advisors' Opinion:
  • [By Jonathan Morgan]

    Munich Re (MUV2), the world�� biggest reinsurer, dropped 4.9 percent to 145.25 euros after it said second-quarter profit fell 35 percent, missing analysts��estimates, as claims arising from natural disasters rose. Net income dropped to 529 million euros from 808 million euros a year earlier, trailing the 557.1 million-euro average estimate of analysts surveyed by Bloomberg.

Hot Regional Bank Companies To Own In Right Now: Decision Diagnostics Corp (DECN)

Decision Diagnostics Corp., formerly instaCare Corp., incorporated on March 2, 2001, is a prescription and non-prescription diagnostics and home testing products distributor. The Company distributes brand name prescription and non-prescription diagnostics products, as well as several lines of ostomy, wound cares and post-surgery medical products. The Company through its subsidiaries, PDA Services, Inc. and Decision IT Corp. offers information technology solutions in several medical cares market channels by providing physicians with information at the point of care. The Company's retail prescription business maintains three operating units, which include Licensed wholesale prescription drug distribution business; Licensed distribution of diabetes diagnostics and supplies; and Internet pharmacy/prescription fulfillment.

The Company's software is designed to integrate point of service applications. The Company is also a developer of products that offer solutions in medical care and management by providing physicians with essential information instantaneously as they meet with their patients. In addition, the Company markets its MD@Hand and MD @Work software application, which also leverages the connectivity of smart cell phones devices through the Internet. The Company's applications run on smart phones manufactured by Apple, Palm, Motorola and Samsung.

Advisors' Opinion:
  • [By Bryan Murphy]

    Over the past few weeks, Lexicon Pharmaceuticals, Inc. (NASDAQ:LXRX) and Decision Diagnostics Corp. (OTCBB:DECN) have dominated the diabetes diagnostics and diabetes treatment landscape. Shares of LXRX jumped 20% on Tuesday following news that one of the key drugs in its pipeline showed more than enough efficacy in its clinical trials. DECN shares are up more than 250% on the heels of an almost-assured victory in its patent lawsuit against industry giant Johnson & Johnson (NYSE:JNJ). Anyone looking for a new trade in the diabetes diagnostics space, however, may want to look past overbought Lexicon Pharmaceuticals and Decision Diagnostics at this point, and instead turn their attention to newly-budding Neurometrix Inc. (NASDAQ:NURO).

Top 10 Cheapest Stocks For 2015: Symantec Corporation(SYMC)

Symantec Corporation provides security, storage, and systems management solutions internationally. The company?s Consumer segment delivers Internet security, PC tune-up, and online backup solutions and services to individual users and home offices. Its Security and Compliance segment provides solutions for endpoint security and management, compliance, messaging management, data loss prevention, encryption, and authentication services to large, medium, and small-sized businesses, as well as offers solutions through its software-as-a-service (SaaS) security offerings. This segment?s products enable customers to secure, provision, and remotely manage their laptops, PCs, mobile devices, and servers. The company?s Storage and Server Management segment provides storage and server management, backup, archiving, and data protection solutions across heterogeneous storage and server platforms, as well as solutions delivered through its SaaS offerings to large, medium, and small-s ized businesses. Symantec?s Services segment offers implementation services and solutions, including consulting, business critical services, education, and managed security services. The company also provides various enterprise support offerings, such as annual maintenance support contracts, including content, upgrades, and technical support. It sells its products through its eCommerce platform, as well as through distributors, direct marketers, Internet-based resellers, system builders, ISPs, and retail locations worldwide. Symantec markets and sells its products through distributors, retailers, direct marketers, Internet-based resellers, original equipment manufacturers, system builders, and Internet service providers; and its e-commerce channels, as well as direct sales force, value-added and large account resellers, and system integrators. The company was founded in 1982 and is headquartered in Mountain View, California.

Advisors' Opinion:
  • [By Tom Taulli]

    In a sudden move, Symantec (SYMC) has terminated its CEO, Steve Bennett. And Wall Street is definitely concerned, as SYMC stock is off about 12% in today�� trading.

Top 10 Cheapest Stocks For 2015: Solar Thin Films Inc (SLTZ)

Solar Thin Films, Inc. is engaged in the business of designing, manufacturing and installation of thin-film amorphous silicon (a-Si) photovoltaic manufacturing equipment. The equipment is used in plants that produce photovoltaic thin-film a-Si solar panels or modules. The Company operates through its wholly owned subsidiary, Kraft Elektronikai Zrt (Kraft). Kraft is engaged in the design, development, manufacture, and installation of a-Si photovoltaic manufacturing equipment. The primary buyers of photovoltaic thin-film manufacturing equipment are businesses, as well as investment partnerships, engaged in the production of photovoltaic thin-film modules. In May 2010, the Company acquired Atlantis Solar LLC. In May 2013, Solar Thin Films Inc acquired Quality Resource Technologies Inc. In October 2013, Solar Thin Films Inc announced the sale of all of its ownership stake of Hungarian subsidiary, Kraft, R.t. (Kraft), to GJR Collectibles LLC.

Kraft has been providing equipment that is incorporated into a single manufacturing line capable of manufacturing a-Si solar modules that produce approximately 5megawatt (MW) of solar power annually. The Company focuses, directly and through joint ventures or alliances with other companies or governmental agencies, to sell equipment for and participate financially in solar power facilities using thin film a-Si solar modules or metallurgical and other crystalline solar modules as the power source to provide electricity to municipalities, businesses and consumers.

The Company competes with Applied Materials and Oerlikon.

Advisors' Opinion:
  • [By Peter Graham]

    Small cap stocks Alliance Creative Group Inc (OTCMKTS: ACGX), Dale Jarrett Racing Adventure Inc (OTCMKTS: DJRT), Inscor Inc (OTCMKTS: IOGA) and Solar Thin Films Inc (OTCMKTS: SLTZ) have all been getting some attention lately in various investment newsletters and it should come as no surprise that two out of four of these stocks have been the subject of paid promotions ��which tend to benefit traders. However, two out of four of these stocks also have pretty good financials for being small cap OTC stocks and that might make them attractive to investors with a long term time horizon. So which of these stocks might make traders some profits in the short term and investors some profits over the longer term? Here is a closer look to help you decide:

Top 10 Cheapest Stocks For 2015: Highway 50 Gold Corp (HWY)

Highway 50 Gold Corp. is an exploration-stage company. The Company is engaged principally in the acquisition and exploration of exploration and evaluation assets. The Company owns, or has the right to acquire an interest in, two projects located in Nevada (the Golden Brew Property and the Porter Canyon Project). Porter Canyon Project consists of 201 unpatented claims located in Lander County, Nevada that cover the projected north-eastern terminus of the Eastgate volcanic trough under pediment cover outboard of the Quito Mine. The Golden Brew claims (Golden Brew) consists of 153 claims prospective for Carlin-style gold mineralization. The gold mineralization at Golden Brew consists of a zone of gold bearing jasperoid measuring 2,500 feet long and up to 200 feet wide, hosted in thin bedded platey Cambrian-aged carbonates. Advisors' Opinion:
  • [By Ben Levisohn]

    It wasn’t all good news, however. Healthways�(HWY) plunged 30% to $11.41, making it the S&P 1500′s biggest loser, while�Cameron International (CAM) fell 18% to $53.25, making it the S&P 500′s weakest stock. Both released disappointing earnings reports this week.

Top 10 Cheapest Stocks For 2015: NTELOS Holdings Corp.(NTLS)

NTELOS Holdings Corp., through its subsidiaries, provides wireless communications services to consumers and businesses primarily in Virginia and West Virginia, as well as parts of Maryland, North Carolina, Pennsylvania, Ohio, and Kentucky. It primarily offers wireless digital personal communications services, such as wireless voice and data products and services, and roaming/travel services under the NTELOS Wireless brand name. The company also provides wholesale network services to Sprint Nextel in the western Virginia and West Virginia area for various Sprint CDMA wireless customers. As of March 6, 2012, its wireless retail business had approximately 415,000 postpay and prepaid subscribers. The company was founded in 1897 and is headquartered in Waynesboro, Virginia.

Advisors' Opinion:
  • [By Lauren Pollock]

    Ntelos Holdings Corp.(NTLS) said it had settled disputes with Sprint Corp.(S) related to the companies’ strategic network alliance. The settlement resolves a dispute over the reset of data rates that began in the fourth quarter of 2011, as well as unrelated billing disputes raised in the third quarter of 2012. Shares of Ntelos were up 9.7% at $17.50 in after-hours trading.

Top 10 Cheapest Stocks For 2015: Provident New York Bancorp(PBNY)

Provident New York Bancorp operates as the bank holding company for Provident Bank that provides commercial, community business, and retail banking products and services to businesses, individuals, and municipalities in New York and New Jersey. It offers various deposit products, such as savings accounts, NOW accounts, checking accounts, money market accounts, club accounts, certificates of deposit, commercial checking accounts, IRAs, and other qualified plan accounts. The company?s loan portfolio includes commercial real estate, commercial business, and one-to four-family real estate loans; acquisition, development, and construction loans; and consumer loans, including homeowner, home equity lines of credit, new and used automobile loans, and personal unsecured loans, such as fixed-rate installment loans and variable lines of credit. In addition, it provides services, including cash management, sweep accounts, insurance agency, investment advisory, asset and investment m anagement, and Internet banking services. As of September 30, 2011, Provident New York Bancorp operated 30 retail branches and 7 commercial banking centers in the Hudson Valley region. The company was formerly known as Provident Bancorp, Inc. and changed its name to Provident New York Bancorp in June 2005. Provident New York Bancorp was founded in 1888 and is headquartered in Montebello, New York.

Advisors' Opinion:
  • [By Jon C. Ogg]

    The M&T Bank Corp. (NYSE: MTB) and Hudson City Bancorp Inc. (NASDAQ: HCBK) transaction is the only pending deal of 2012 vintage due to various regulatory concerns. MTB currently has 9% short interest outstanding and PACW 15%. Another merger covered is the deal between Provident New York Bancorp (NASDAQ: PBNY) and Sterling Bancorp (NYSE: STL), and the balance are simply too small for us to warrant effort.

Top 10 Cheapest Stocks For 2015: Domino's Pizza Inc(DPZ)

Domino?s Pizza, Inc., through its subsidiaries, operates as a pizza delivery company in the United States and internationally. The company sells and delivers pizzas under the Domino?s Pizza brand name. As of January 1, 2012, it operated through a network of 9,742 stores, including 394 company-owned stores and 9,348 franchise stores located in the 50 states and approximately 70 international markets. Domino?s Pizza, Inc. was founded in 1960 and is headquartered in Ann Arbor, Michigan.

Advisors' Opinion:
  • [By Damian Illia]

    Recognized world leader Pizza Company Domino�� Pizza Inc. (DPZ) sells and delivers pizza through the U.S. and internationally, operating its business in three segments: Domestic Stores, Domestic Supply Chain and International. As of Dec. 31, 2013, the domestic stores comprised 4,596 franchised stores and 390 company-owned stores. The International segment consists of 5,900 franchised stores outside the U.S. Generating nearly $3.8 billion in the U.S. and $4.2 billion internationally during 2013, Domino�� fourth-quarter 2013 results beat estimated figures for both earnings and revenues. Same-store sales popped 3.7% domestically and 7% internationally, while diluted earnings per share leaped 21.9% to $0.78. It was the 80th quarter and 20th full year in a row of international same-store sales growth for Domino's.

  • [By James O'Toole]

    In Congress, a group of 53 lawmakers sent letters Wednesday expressing support for higher wages to McDonald's (MCD, Fortune 500), Wendy's (WEN), Domino's Pizza (DPZ), Burger King (BKW) and Yum! Brands (YUM, Fortune 500), which operates KFC, Pizza Hut and Taco Bell.

  • [By vinaysingh] med in the industry as Pizza delivery expert, this food chain has not only pleased its customers with great taste but also investors with massive returns. Its stock has almost doubled over the past 12 months as a result of sustained growth in earnings and increasing confidence of investors. Domino�� has also created reasonable value for shareholders by ensuring a consistent dividend policy.

    Specialization and Expansion are the key drivers

    When a company operates in a highly competitive industry, it can sustain and grow only by creating a separate identity for itself (an advice I have got throughout my life). Well, Domino�� has successfully implemented this dictum by becoming the go-to chain for offering unparalleled service when it comes to pizza delivery. The company�� strength was clearly visible in its second quarter results wherein it reported an EPS of $0.57 per share, up 21.3% over the prior year quarter. Its international division reported same store sales growth of 5.8%. Another thing that has aided Domino�� growth is its aggressive expansion strategy. Consider this; the international division of Domino�� grew by a whopping 101 stores in the second quarter alone.

    Hiccups in certain countries

    While I appreciate Domino�� aggressive expansion, the performance of some of its franchises in major countries is worrisome. Reportedly, a couple of directors in Domino's UK offloaded sizable stake in the company that was preceded by a stake sale by the CFO of the company. It is believed that a poor show in the first half of the year could have propelled these executives to exit at a good valuation. In India, Jubilant Foodworks that runs the Domino�� franchise reported a massive decline in the growth of same-store sales from 22.3% to 6.3% in Q1, 2013. In order to beat the slowdown in demand, Jubilant introduced new products as well as entered new regions.

    Though the stock has not been punished on the U.S bourse because of

Top 10 Cheapest Stocks For 2015: Key Tronic Corporation(KTCC)

Key Tronic Corporation, doing business as KeyTronicEMS Co., together with its subsidiaries, provides electronic manufacturing services (EMS) to original equipment manufacturers primarily in the United States, Mexico, and China. Its EMS services include product design, surface mount technologies for printed circuit board assembly, tool making, precision plastic molding, liquid injection molding, automated tape winding, prototype design, and full product builds. The company also manufactures keyboards and other input devices for personal computers. Key Tronic markets its products and services primarily through its direct sales department aided by field sales people and distributors. The company was founded in 1968 and is headquartered in Spokane Valley, Washington.

Advisors' Opinion:
  • [By Lisa Levin]

    Computer Peripherals: This industry rose 2.21% by 10:15 am ET. The top performer in this industry was Key Tronic (NASDAQ: KTCC), which gained 0.3%. Key Tronic's trailing-twelve-month ROE is 14.57%.

Is the stock market rigged?

"Beware those who seek constant crowds, for they are nothing alone."

-- Charles Bukowski

"The United States stock market, the most iconic market in global capitalism, is rigged."

So says Michael Lewis. His most recent book, Flash Boys, has drawn a huge amount of scrutiny to what really isn't a new problem: high-frequency trading, or HFT. It's a debate that's been going on for some time on Wall Street, and we should be grateful for Lewis' storytelling ability to make such an arcane topic accessible to the general public.

The attention and scrutiny given to Flash Boys has resulted in the definitive answer to one question: "How can an author sell a lot of books?"

On other questions, there is unlikely to be a definitive answer, in part because of what is the most fascinating revelation of the debate so far: No one really knows how the stock market actually works.

To me the question is whether HFT is a malevolent force -- and I believe that it is. Further, I believe that the actions of the players are much more important than what they say. So while this debate will certainly focus on what Lewis got wrong (and make no mistake, he did get things wrong), those who profit from HFT will attempt to use those errors to extrapolate that Lewis' entire premise is wrong. In classical rhetoric, that's known as a "fallacy of stupidity."

Here's my own primer. It is basic and also certain to be wrong in parts (see "no one really knows," above).

1. The markets are, and have always been, about speed. There's a reason traders don't stand around the Buttonwood tree anymore, and why the stock market scene from Trading Places now looks so anachronistic. Electronic trading has made the buying and selling of stocks (and other financial instruments) more efficient, lowering spreads, and trading costs for everyone. HFT is a kind of electronic trading, but the two are not the same thing. I don't think that things like sub-second trading add much to the market (where "much" equals "liqu! idity"), but I sincerely doubt that this is the source of many problems, either.

2. Market participants have always accessed the market at different speeds. Some people traded by telegram while others went to telegraph. Others had phone access, then dial-up modem access, then broadband, then direct fiber collocated at the exchange. No competent argument should posit that access speeds to the markets should be identical for all participants because this is impossible. And dumb.

Market participants have similarly always used these speed differentials to their advantage. It's why companies set up massive day-trader pits in the 1990s. In our business of running mutual fund portfolios, we have certain algorithms that we use to trade to maximize efficiency. In a pari-mutuel system, maximized efficiency has always and will always come at the cost of the inefficient.

But a few years ago something changed, and to me it is at the center of the argument. The exchanges themselves (NYSE, Nasdaq, etc.) started providing information faster to those who paid for it, and also gave them the ability through their own algorithms to jump in front of other participants. By "faster" I mean that we're measuring in tiny fractions of seconds, but it's enough.

Those who insist that HFT is no big deal and actually adds efficiency and liquidity to the market have a hard time describing why this is cool. The fastest traders could simply make money by being the fastest, by having preferential access at the exchanges themselves. They don't care what they're trading -- Apple stock, frozen concentrated orange juice futures, whatever. They take advantage of their latency advantage to jump in front of other market participants -- and that latency is provided by the exchanges themselves.

Best Consumer Stocks To Invest In Right Now

That's what's different about HFT. The exchanges have sold certain participants p! rivileged! access and in turn pay those same participants to create volume, creating a situation in which HFT firms can pretty much make a guaranteed profit on every trade. A super-tiny profit, yes, which is why the HFT firms must make millions of trades a day. That's why they're called "high-frequency traders." HFT firms are investing hundreds of millions of dollars, and paying the exchanges enormous sums to get in front of the line, and we are to believe that this is a benign market function?

Basic business sense should tell you what's up here. The HFT guys are not stupid. The algorithms they create are mind-bendingly complex. And if they are going to invest such huge sums for preferential speed and access, they will demand (as they should) a satisfactory return on their investments.

I don't even blame the HFT guys here. The real villains, in my mind, are the exchanges themselves. I've argued a few times in these pages (most recently in Question Authority, Jan. 17, 2014) that one of the most dangerous things that's happened over the past 20 years in investing is that the exchanges themselves converted from private partnerships to publicly traded entities.

In my mind, having a quarterly number to hit to satisfy stockholders has given exchanges an almost irresistible incentive to compete with one another to maximize profits. And on occasions where you're just lowering your standards a little bit (See "reverse merger," "Chinese," "small caps," almost all of them as an example), then shareholder protection and fairness become that much more expendable. Self-interest does a strange thing to people. It corrupts.

So this leads to two questions:

"Is the market rigged?"

"Does this hurt me?"

As to the first, my answer is an unequivocal "yes," followed by "and this isn't new." HFT, as practiced by the exchanges' selling of asymmetric access to certain market participants, simply isn't fair. The HFT algorithms essentially attempt to influence the price of the market through tactics! like "qu! ote stuffing," which is about like it sounds. What we don't know is how far these market participants are willing to go to distort the market to their advantage.

The second question is much more important. Systemically, things that cause market participants to lose faith in that market are probably bad. But there are lots of things that manipulate stock markets. Federal Reserve policy is all about influencing investor behavior. So is capital-gains tax policy. It's possible that you've had a few pennies harvested from you during a trade.

There is an obvious solution to combat this: trade less. Be a long-term holder of businesses. Focusing on HFT as a reason to be in or out of the market is absurd. The stock market isn't Vegas or some crooked numbers game. It's a tool that allows ordinary folks like us to buy pieces of businesses, which, if you're doing it right, tend to appreciate in value. Some lose, yes, but ultimately your investment returns are overwhelmingly going to be driven by what investments you hold.

It's the Joshua Principle: "A strange game. The only winning move is not to play." Worrying about HFT as an individual investor is like worrying about sunspots. Yes, they might be bad for you, but not nearly as unhealthy as your three-chalupa lunch was. Frankly, out-of-control management compensation is a far, far bigger drag on your long-term investment returns than HFT could ever dream of being. Worry about that.

Returns in investing come from buying something for $1 and selling it for a lot more. If HFT causes you to buy it for $1.00000001 instead, is that really, truly harmful when you sell it for $2.63 years from now? Trading has both overt and hidden expenses to it, and those expenses can add up over time.

Speaking of "over time," in aggregate, stocks go up in value, over time. If you're buying and selling stocks in a hurry (or holding mutual funds that frequently turn over their asset base), you're leaving yourself more susceptible to the machinations (and mani! pulations! ) of the stock market. If you aren't, you aren't. Simple.

And read Michael Lewis' book. Whether it has wrongness built into it (and it does), it will give you an idea why our stock exchanges are threatening to surpass both Congress and the NCAA on the cravenness scale. They're the villains in this story, because they're supposed to promote fairness.

The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.

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India Has a (Likely) Winner

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If you've ever thought that American elections take on a certain element of the carnival, you should experience or follow Indian elections at least once. Essentially a five-week free-for-all, more than 800 million people are eligible to vote in nine-phases which run from April 7 to May 12 this year. Because typically voter turnout is about 60 percent, if the average turnout rate holds, 100 million more people than live in the US will cast ballots in India.

Seeing that process through is an expensive proposition, with this year's elections in India ultimately being estimated to cost at least $5 billion. They will likely cost much more once all of the candidate spending figures are accounted for. More than 200,000 security personnel have also been deployed to ensure a peaceful process.

While it is still too soon for official tallies, Narendra Modi is already being called the next Prime Minister of India.

While India has liberalized some of its economic policies over the years, in a government dominated by the Congress Party, the country's subsidy program remains at a bloated INR2.2 trillion, covering everything from food and fertilizers to diesel fuel. There's also still a streak of protectionism in the country's economic policies, making foreign investment in India somewhat spotty. That has helped keep the country's fiscal deficit stubbornly in the neighborhood of 5 percent of gross domestic product.

Already a three-term chief minister of Gujarat, the seventh largest state in India with a population similar in size to Italy, Modi has developed an almost peerless record for being business-friendly. Over his time in office the roads in Gujarat have become some of the best and most expansive, businesses have flourished as red tape has been slashed, and government headcount in the state has shrunk. He also helped to attract huge foreign investment in Gujarat, creating one of India's leadi! ng industrial states.

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In some news reports, Modi is even being referred to as the Indian Ronald Reagan; a member of the more conservative Bharatiya Janata Party (BJP), Modi's free market economic stance is a clear contrast to the Congress Party's more liberal, state-driven economic ideas. Many believe Modi's elevation to PM will mark a watershed moment for the Indian economy, which is struggling with sluggish growth and high unemployment, particularly among the nation's 1.2 billion people under 25. It's estimated that 12 million new jobs need to be created each year to absorb the country's growing workforce.

But while Modi's success in Gujarat has led to high hopes he'll be able to achieve similar results on a national scale, it's not guaranteed.

For one thing, Modi's strategy has focused primarily on attractive capital-intensive heavy industries to his state, and has been widely criticized for not creating a better class of jobs. Also, without radically easing the process by which foreign companies can invest in India, it would be difficult to drive such large-scale industrialization across the country.

At the same time the BJP's track record at the helm of the national government is a bit spotty. When it last ruled, from 1998 to 2004, it made little headway on labor reforms, and strict job protection measures and wage rules are sacred cows in Indian politics. That's one of the key reasons why the Congress Party with its populist brand of politics has been able to maintain its control of the government for so many years.

 It should also be noted that current Prime Minister Manmohan Singh, with a doctorate in economics from Oxford, also promised wide ranging labor and economic reforms over his two terms but made scant little progress because of the political realities in the country. In fact, Singh is wid! ely criti! cized for "governance by non-governing" because it is so incredibly difficult to build a consensus thanks to radically diverse regional needs and beliefs.

But after years of graft scandals, the weakest period of economic growth in more than a decade and torrid capital outflows that have devastated the rupee, it's hardly surprising that Modi has received such strong support. The real question is whether or not he'll be able to rally enough support in such a huge, diverse country to make any progress on an agenda of meaningful reform.