Nomura Securities Initiates Coverage on The Gap at “Neutral” (GPS)

Nomura Securities announced on Monday that it has started coverage on apparel retailer The Gap Inc. (GPS).

The firm has initiated coverage on GPS with a “Neutral” rating and $42 price target. This price target suggests a 4% increase from Friday’s closing price of $40.39.

Analyst Simeon Siegel commented: “With top- and bottom-line resurgence, there is no question this has been the year (and-a-half) to own The Gap (GPS). But interestingly, FY12 total sales were still below FY04 levels, suggesting that through improvedproduct, the new global focus on the top line, and views on an omni-channel perspective on inventory; GPS has room to drive the company to new heights. Valuation keeps us sidelined. We are projecting FY13/FY14 EPS estimates of $2.69/$3.00 versus the Street at $2.77/$3.06. Our $42 target price is based on 14x our FY14 estimate versus the peer group average 14x multiple and the company's historical average of 14.5x.”

The Gap shares were mostly flat during pre-market trading Monday. The stock is up 30% YTD.

Surprise! Lehman Brothers is still big

Even though Lehman Brothers went bankrupt five years ago, there are still employees working in New York and elsewhere to unwind assets.

NEW YORK (CNNMoney) Five years after its implosion, Lehman Brothers, once the world's fourth largest bank, is still a giant corporation with roughly 300 employees working full-time in offices all over the world.

Most of its remaining employees work out of two floors of the Time-Life building not far from the bank's former headquarters in midtown Manhattan.

Lehman will eventually cease to exist. A bankruptcy court opted to liquidate Lehman Brothers.

But that unwinding is expected to take at least several more years. Lehman has more than $30 billion to recover, and several multi-billion dollar legal fights left over how much creditors will recoup from the remaining assets of Lehman's main U.S. operations.

Affiliates of other international units of Lehman are separately unwinding their stakes, making the overall headcount even higher.

The largest debt holders will only get back a fraction of what they're owed. Still, they have recovered much more than many, including Lehman, had expected.

Shortly after Lehman declared bankruptcy, Barclays (BCS) paid $1.3 billion for most of the firm's North American operations, its Times Square headquarters, and about 9,000 employees. Nomura Holdings (NMR) paid roughly $200 million for Lehman's operations in Asia.

And that was just the beginning. Lawyers and bankers for the Lehman estate estimate that creditors will receive roughly $80 billion back against $309 billion in debts as of March 2013. Creditors have already received $47.2 billion in payments.

  How I bounced back after Lehman collapsed

The rising real estate market has helped Lehman lately. Earlier this year, the estate sold its stake in apartment building operator Archstone for $6.5 billion. The valuation was still a far cry from the $22 billion price tag that Archstone was valued at in 2007, but much higher than estimates since the credit crisis.

Lehman has more than $8 billion in real estate left.

It will continue to fight battles in court that could lead to higher recoveries for creditors. Among the big battles, Lehman is still fighting a multi! -billion lawsuit against JPMorgan Chase (JPM, Fortune 500) saying that its investment bank forced the company into a rapid fire bankruptcy filing because of its collateral calls.

Lehman's bankruptcy caused pain for its employees and shareholders, but five years later, many players in the saga have found ways to score big payouts.

Some hedge funds, including John Paulson's, have scored big by purchasing Lehman's debt immediately after the bankruptcy filing.

Investment bankers and lawyers have already been well compensated for recovering funds for creditors too. Since 2008, bankers and lawyers working on the bankruptcy have earned $2.2 billion.

Is Copper Worth Your Time?

The price of copper has been falling, and so have shares of copper miners. The bad news is that the International Copper Study Group expects further discrepancies between supply and demand. It projects that the growth rate of global refined copper usage will be at least 1.2 percentage points below total refined copper production's growth rate in 2013 and 2014. Some miners are still worth looking at, but you need to dig down and take a long-term view.

Copper LME Settlement Price data by YCharts

The big picture
Construction is one of the biggest drivers of copper demand, and slowing industrialization in the emerging markets is creating a bear market. The copper industry needs to realize that falling growth rates in China will decrease future demand, and fewer mines need to be opened. Downward pressure on copper prices may be a blessing in disguise, as it will help decrease the number of new mines brought online. 

The miners
Southern Copper (NYSE: SCCO  )  is one of the stronger pure copper plays. The company owns a number of mines in Mexico and Peru. As of the second quarter of 2013 its operating cash costs net of by-products averaged $1.09 per pound of copper, while LME copper price per pound fell slightly to $3.24. This means that Southern Copper does have some breathing room, even if prices fall farther. 

One of the biggest threats for Southern Copper is cost inflation. It should be able thrive in the medium term, but it needs to keep costs under control as global consumption growth slows. Maintaining healthy cash flow is challenging, and new environmental regulations recently forced the company to spend $570 million to improve sulfur capture in one of its Peruvian smelters.

Regardless, the firm needs to maintain its capex. It has a number of projects that should come online by the end of 2014 and 2015. Long-term investors should not be surprised if investment spending compresses earnings growth for the next couple of quarters.

Freeport-McMoRan Copper & Gold (NYSE: FCX  ) is one of the most interesting plays within the copper market. It recently broke the mold when it decided to merge with the oil and gas firm, Plains Exploration & Production. The merger reduces Freeport's dependency on the volatile metal prices, but it also means that management must navigate two very different industries. 

In May a mining accident forced Freeport to close its Eastern Indonesian operations for a government inspection. Its facilities have been restarted, but its 2013 copper production is expected to be reduced by 230 million pounds of copper, and its gold production is expected to fall by 250,000 ounces. Varying ore grades have temporarily compressed its margins in its Grasberg mine, but in the 2014 to 2016 period the company expects margins will bounce back.  

Considering Freeport's 2013 accident and the temporary fall in Grasberg's margins, investors can expect stronger earnings in in the next couple years. 

Taseko Mines  (NYSEMKT: TGB  ) is a relatively small miner that owns Canada's second largest open pit copper mine. The company is not profitable, but it is working on a number of interesting projects. Investing in undeveloped mines is risky, but Taseko mitigates these risks by focusing on projects in Canada where resource nationalization is a very small threat. 

It is working to get its New Prosperity mine in British Columbia approved. Ottawa already rejected Taseko's proposal once due to environmental concerns. After a $300 million redesign the company is hopeful that it will get the mine approved and eventually be able to push its earnings into the black.

Taseko is an interesting company to watch, but it is still a small firm developing billion dollar projects in a world of compressed commodity prices.

Teck Resources (NYSE: TCK  ) is a large diversified miner with significant interests in copper, energy, and metallurgical coal. Its 2012 copper cash costs after by-products were an economical at $1.56 per pound. In light of recent price declines in copper and other commodities it has put off $650 million in capex for its Quintette mine. As of the second quarter of 2013 it hopes to cut $250 million more in annual costs. 

Teck's ability to put off capex, engage in cost cutting and still turn a profit shows the benefit of investing in a large and diversified miner. Even with lower commodity prices Teck has options. The downside is that the company is trading at high valuations with a price-to-earnings ratio around 21. 

Conclusion
Copper has taken a downturn, but some of the larger miners like Freeport-McMoRan and Southern Copper are worth looking at. Freeport had a number of temporary difficulties in 2013 that make it a good deal right now. Southern Copper's earnings will probably be compressed for the next year as it waits to finish a number of projects. If the market decides to punish the stock for a lack of short-term growth, buying it in the midst of the downturn could be quite profitable. 

Keep on digging
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Is it Worth Holding onto Big Banks?

Given the way the big banks are looking, is there any reason to buy or hold onto any of them right now? The answer MoneyShow's Jim Jubak, also of Jubak's Picks, has, may surprise you.

We know that the big US banks are going to deliver a lousy third quarter, when earnings season starts with Alcoa (AA) on October 8.

So, is there any reason to own any of the big US banks as the sector gets ready to stink up the joint?

Maybe. Selectively. And I'd say Citigroup (C) would be my top pick among big US banks right now. (Citigroup is a member of my Jubak's Picks portfolio.)

It's hardly a secret that third quarter earnings are going to be bad, since the big banks have been cutting jobs in their mortgage units right and left as refinancing volumes slump. Citigroup has let 1,000 people go in its mortgage unit, and Wells Fargo (WFC) has fired 4,000. JPMorgan Chase (JPM) has told Wall Street to expect a 20% to 30% quarter-to-quarter drop in mortgage banking revenue in the quarter.

And that's just the beginning of the sector's woes. Revenue from trading is likely to fall heavily in the quarter on a slowdown in fixed-income revenue. JPMorgan and Barclays have said that third quarter trading revenue for 2013 is likely to be below that for the third quarter of 2012. Citigroup revenue from fixed-income, currency, and commodities trading is likely to fall by 25%, including the Sanford C. Bernstein & Co. project.

Let's finish off our litany of woes with the piles of cash that big US banks are paying-or are likely to pay-to regulators or investors. For example, JPMorgan Chase will pay $920 million to settle charges that it violated federal securities laws in the London Whale trading scheme. The company faces a likely $3 billion to $7 billion settlement of $11 billion in claims over the packaging of mortgage bonds that cratered in the global financial crisis. Citigroup has agreed to pay Freddie Mac $395 million to resolve repurchase claims on mortgages that the bank sold to the company.

It's the very visibility of all this bad news that makes the sector more intriguing than it might seem. Some big part of the bad news is already out there. Shares of Citigroup, for example, are down 5.7% from September 18 through the close on September 25. That's a big drop for a week. JPMorgan Chase has fallen 8.6% from August 1 through the close on September 25. Wells Fargo is off 6.2% from August 2 through the September 25 close.

There's definitely the possibility of a bounce in shares of big US banks after these kinds of drops. You can see that potential in the 2.4% bounce in JPMorgan shares yesterday, September 25, on news that the company was in talks to settle that $11 billion in potential mortgage claims.

But that potential bounce runs right into a longer-term story that is likely to keep pressure on the financial sector in general. If interest rates have plunged in the days since the Federal Reserve's no taper decision on September 18-and yields on 10-year US Treasuries have tumbled to 2.63% as of September 25, from an early September high slightly above 3%-there's a very good likelihood that they will begin to climb again as we approach the December meeting of the Federal Reserve's Open Market Committee on December 18. And if the financial markets start to think, after the beginning of any taper, that the Fed might start to raise short-term interest rates before 2015, then banks and financials, in general, face even stronger headwinds.

So, I'd like any big bank stock that I own, therefore, to have something going for it besides a potential bounce, as we head into third quarter earnings season.

Last quarter, Citigroup demonstrated that it had that something else in the form of gradually improving bad loans at Citi Holdings, the company's huge bad bank. In the quarter, Citigroup released $525 million in reserves against the Citi Holdings mortgage portfolio. Citigroup continued to wind down its assets in Citi Holdings-they were down by $60 billion in the June quarter from the second quarter of 2012-but the bad bank still has plenty of work to do with $80 billion in its North American mortgage portfolio alone. Given the continued strength of the US housing market, I think it's reasonable to expect the release of another few hundred million in reserves against that portfolio this quarter.

Citigroup investors have to try to balance the negatives in the short-term story against the positives in the long-term credit story. After the decline in the stock over the last week, I think it's worth holding Citigroup shares through the October 15 earnings results.

Full disclosure: I don't own shares of any of the companies mentioned in this post in my personal portfolio. When in 2010 I started the mutual fund I manage, Jubak Global Equity Fund Jubak Global Equity Fund , I liquidated all my individual stock holdings and put the money into the fund. The fund may or may not now own positions in any stock mentioned in this post. The fund did not own shares of Citigroup as of the end of June. For a full list of the stocks in the fund as of the end of June see the fund's portfolio here.

Top 5 Cheap Stocks To Watch Right Now

But he is not to blame. For in those days investing hardly called for any qualitative checks. What was lost on Einstein is not a secret formula to help find cheap stocks. But the behavioral trait to buy only when others are fearful.

Now 1929 was not the only time when stock markets gave a torrid time to investors. But even as late as 2007, there were few lessons learnt.

The analysts at Wall Street used complex formulae to see how the past performance can be used to simulate the future. They ran screens, tested scenarios and compared with standard deviation of peers. Being objective about their investing decisions came naturally to them. They could estimate the minutest change in company's earning power with a single basis point change in pricing. But the immodest pricing of subprime home loans did not draw their attention. They 'objectively' invested and re-invested in papers with zero valued collateral. This was purely out of their greed for higher ROI (return on investment). Eventually when the loans turned bad and banks were on the verge of insolvency, the objectivity of such investing came to be questioned.

Top 5 Cheap Stocks To Watch Right Now: Local.com Corporation(LOCM)

Local.com Corporation operates as an Internet search advertising company that enables businesses and consumers to find each other and connect locally. Its Owned and Operated business unit manages its flagship online property Local.com and a proprietary network of approximately 20,000 local Websites that reach approximately 15 million monthly unique visitors. The company places various display, performance, and subscription advertisement products on its Local.com and proprietary network. Its Network business unit operates a private label local syndication network of approximately 1,000 U.S. regional media Websites; 80,000 third-party local Websites; and its own organic feed of local businesses plus third-party advertising feeds that focus primarily on local consumers to a distribution network of hundreds of Websites. The company?s Sales and Ad Services business unit provides approximately 45,000 direct monthly subscribers with Web hosting or Web listing products. The compan y was formerly known as Interchange Corporation and changed its name to Local.com Corporation in November 2006. Local.com Corporation was founded in 1999 and is headquarters in Irvine, California.

Top 5 Cheap Stocks To Watch Right Now: Ford Motor Credit Company(F)

Ford Motor Company primarily develops, manufactures, distributes, and services vehicles and parts worldwide. It operates in two sectors, Automotive and Financial Services. The Automotive sector offers vehicles primarily under the Ford and Lincoln brand names. This sector markets cars, trucks, and parts through retail dealers in North America, and through distributors and dealers outside of North America. It also sells cars and trucks to dealers for sale to fleet customers, including daily rental car companies, commercial fleet customers, leasing companies, and governments. In addition, this sector provides retail customers with a range of after-sale vehicle services and products in the areas, such as maintenance and light repair, heavy repair, collision repair, vehicle accessories, and extended service contracts under the Ford Service, Lincoln Service, Ford Custom Accessories, Ford Extended Service Plan, and Motorcraft brand names. The Financial Services sector offers vari ous automotive financing products to and through automotive dealers. It offers retail financing, which includes retail installment contracts for new and used vehicles; direct financing leases; wholesale financing products that comprise loans to dealers to finance the purchase of vehicle inventory; loans to dealers to finance working capital, purchase real estate dealership, and/or make improvements to dealership facilities; and other financing products, as well as provides insurance services. Ford Motor Company was founded in 1903 and is based in Dearborn, Michigan.

Advisors' Opinion:

• [By Shauna O'Brien]

  On Wednesday, Citigroup reported that it has raised estimates on Ford Motor Company (F).

  The firm has boosted its estimates on Ford due to its Asia Pacific share gains. Citigroup currently has a a $20 price target on Ford, suggesting a 13% upside from the stock’s current price of $17.44.

  Ford shares were down 8 cents, or 0.46%, during pre-market trading Wednesday. The stock is up 35% YTD.

• [By Paul Ausick]

  Far fewer — only 14% — have purchased annuities that transfer liabilities to a third party, but Mercer believes that the success of risk-transfer programs such as those undertaken in 2012 by Ford Motor Co. (NYSE: F), General Motors Co. (NYSE: GM), and Verizon Communications Inc. (NYSE: VZ) will encourage others to look closely at lump-sum distributions or purchasing annuities. A third of respondents said they are very likely/somewhat likely/will consider dumping defined benefit plans.

• [By WALLSTCHEATSHEET.COM]

  Ford is a well-established vehicle products and services producer, distributed in a multitude of countries across the globe. The company may be losing its Chief Executive Officer sooner than expected. The stock has been surging over the last year and is now trading at highs not seen for a couple of years. Over the last four quarters, investors in the company have had mixed feelings as revenues have been rising while earnings have been mixed. Relative to its peers and sector, Ford Motor is an average year-to-date performer. Look for Ford Motor to OUTPERFORM.

• [By Chad Fraser]

  There are a number of ways for investors to profit from the rising auto sales. The obvious approach is to buy shares of major automakers like General Motors (NYSE: GM), Ford (NYSE: F) or Nissan (OTC: NSANY). (We took a close look at Nissan in a September 3 Investing Daily article. Click here to read the full piece.)

Hot Stocks To Buy Right Now: Lattice Semiconductor Corporation(LSCC)

Lattice Semiconductor Corporation designs, develops, manufactures, and markets programmable logic products and related software. The company offers field programmable gate array (FPGA) products, including LatticeECP family for deployment in wireless infrastructure and wireline access equipment, as well as in video and imaging applications; and LatticeXP for the security, surveillance, and display markets. It also provides programmable logic device (PLD) products comprising various versions of ispMACH4000 in-system programmable complex programmable logic device family; MachXO family that is designed for a range of low density applications; platform manager, power manager, and ispClock programmable mixed signal devices; and software development tools and intellectual property cores. The company sells its products directly to end customers through a network of independent manufacturers? representatives and indirectly through a network of independent sell-in and sell-through distributors. It primarily serves original equipment manufacturers in the communications, computing, consumer, industrial, military, automotive, and medical end markets. The company was founded in 1983 and is headquartered in Hillsboro, Oregon.

Top 5 Cheap Stocks To Watch Right Now: Wendy's/Arby's Group Inc.(WEN)

The Wendy's Company operates as a quick-service hamburger company in the United States. The company, through its subsidiary, Wendy's International, Inc., operates as a franchisor of the Wendy's restaurant system. As of December 26, 2011, the Wendy's system comprised approximately 6,500 franchise and company restaurants in the United States and the United States territories, as well as in 26 other countries worldwide. The company was formerly known as Wendy's/Arby's Group, Inc. and changed its name to The Wendy's Company in July 2011. The Wendy's Company was founded in 1884 and is headquartered in Dublin, Ohio.

Advisors' Opinion:

• [By Michael Flannelly]

  Argus Research upgraded fast food restaurant operator The Wendy’s Co (WEN) on Thursday, noting that the company’s store remodeling and new menus should help drive higher sales.

  The analysts upgraded WEN from “Hold” to “Buy” and see shares reaching $10. This price target suggests a 21% upside to the stock’s Wednesday closing price of $8.25.

  Wendy’s shares were up 24 cents, or 2.91%, during early morning trading on Thursday. The stock is up 54.19% year-to-date.

• [By Douglas A. McIntyre]

  Starbucks can number itself among the chains that have been picked on by McDonald’s. The leading fast-food company is in a salad war with Wendy’s Co. (NYSE: WEN), which has a menu item called “Garden Sensation Salads.” Wendy’s has put these up against the 10 salads that McDonald’s offers. Clearly the smaller company believes it cannot afford to be flanked.

• [By Ben Levisohn]

  Upgrades had a big impact on stocks today. Wendy’s (WEN), for instance, gained 4.5% to $8.62 after being upgraded to Buy at Argus, while Cash America (CSH) advanced 3.7% to $44.32 after being upgraded to Market Outperform from Market Perform at JMP Securities. Walgreen (WAG) proved the big winner in the S&P 500 after�Goldman Sachs called the stock a Conviction Buy.

Top 5 Cheap Stocks To Watch Right Now: UnitedHealth Group Incorporated(UNH)

UnitedHealth Group Incorporated provides healthcare services in the United States. Its Health Benefits segment offers consumer-oriented health benefit plans and services to national employers, public sector employers, mid-sized employers, small businesses, and individuals; and non-employer based insurance options for purchase by individuals. It also provides health and well-being services for individuals aged 50 and older; and for services dealing with chronic disease and other specialized issues for older individuals, as well as health plans for the beneficiaries of acute and long-term care Medicaid plans. This segment offers its services through a network of 730,000 physicians and other health care professionals, and 5,300 hospitals. Its OptumHealth segment provides health, financial, and ancillary services and products that assist consumers through personalized health management solutions; benefit administration, and clinical and network management; health-based financi al services; behavioral solutions; and specialty benefits, such as dental, vision, life, critical illness, short-term disability, and stop-loss product offerings. The company?s Ingenix segment offers database and data management services, software products, publications, consulting and actuarial services, business process outsourcing services, and pharmaceutical data consulting and research services. Its Prescription Solutions segment provides integrated pharmacy benefit management services comprising retail network pharmacy contracting and management, claims processing, mail order pharmacy services, specialty pharmacy, benefit design consultation, rebate contracting and management, drug utilization review, formulary management programs, disease therapy management, and adherence programs to employer groups, union trusts, managed care organizations, Medicare-contracted plans, Medicaid plans, and third party administrators. The company was founded in 1974 and is based in Minne tonka, Minnesota.

Advisors' Opinion:

• [By Reuters]

  Wendy Maeda/The Boston Globe via Getty Images NEW YORK -- Walgreen is moving 120,000 employees to a private health insurance exchange from coverage provided directly from carriers, the company will announce Wednesday. The pharmacy chain will join 17 other large employers on the Aon Hewitt Corporate Health Exchange as part of a growing movement to offer employees fixed dollar amounts to purchase their own plans on such exchanges. The end-cost to employees depends on the plan chosen, but they typically get more options than under traditional arrangements. Private exchanges mimic the coverage mandated as part of the Affordable Care Act. Enrollment in the public exchanges starts Oct. 1. "What happens to employer contributions over time? Will they put in as much as they put in the past? These are unanswered questions but potential negatives," says Paul Fronstin, a senior research associate with the Employee Benefit Research Institute. The benefit to Walgreen and other employers is unknown at this point, as their cost-savings aren't clear. Of the 180,000 Walgreen (WAG) employees eligible for health care insurance, 120,000 opted for coverage for themselves and 40,000 family members. Another 60,000 employees, many of them working part-time, weren't eligible for health insurance. Aon Hewitt (AON) says other participants in its program include retailer Sears Holding (SHLD) and Darden Restaurants (DRI). These new additions raise enrollment to 330,000 from 100,000 last year, and Aon Hewitt estimates enrollment will jump to 600,000 next year, a fivefold increase from 2012. By 2017, nearly 20 percent of employees nationwide could get their health insurance through a private exchange, according to Accenture Research (ACN). A recent report by the National Business Group on Health said that 30 percent of large employers are considering moving active employees to exchanges by 2015. Other major providers of private exchanges include Mercer, a division of Marsh & Mc

Hot Performing Companies To Buy Right Now

The year 2007 marked a pivotal transition for media consumption trends. It was the year Netflix (NASDAQ: NFLX  ) made its mark on history and forever changed media consumption habits by streaming digital video over the Internet. Since then, the competition for content from Internet streaming companies has only increased among the likes of Amazon.com� (NASDAQ: AMZN  ) �and Netflix.

A prime example is the show Under the Dome, adapted from Stephen King's novel, which has been the biggest summer success for a CBS (NYSE: CBS  ) television series since 1992.

Source: CBS.

While the show has slipped under the radar of most people, its secret summer success is a perfect example of the ensuing battle among the Internet streaming giants. In the following video, Blake Bos breaks down how the show is performing and tells you what industry and companies stand to profit the most from this digital streaming battle.

Hot Performing Companies To Buy Right Now: Ashtead Grp(AHT.L)

Ashtead Group plc, an investment holding and management company, engages in the rental of equipment to industrial and commercial users primarily in the non-residential construction sectors of the United States and the United Kingdom. It supplies equipments that lift, power, generate, move, dig, compact, drill, support, scrub, pump, direct, and ventilate under the brand names of Sunbelt Rentals and A-Plant. The company provides a range of industrial and construction equipment, such as earthmoving equipment, aerial work platforms, high reach forklifts and other materials handling units, tools, and pumps, as well as power generation, portable site accommodation, scaffolding, formwork and false work, and temporary traffic management equipment; and new and used equipment. Ashtead operates 106 stores in England, Scotland, and Wales; and 316 full service stores and 40 Sunbelt at Lowes shops in the United Kingdom. It serves construction and industrial markets, disaster relief agen cies, sport and music event organizers, governments, local authorities, facilities management, and homeowners. The company was founded in 1947 and is based in London, the United Kingdom.

Hot Performing Companies To Buy Right Now: Hibbett Sports Inc.(HIBB)

Hibbett Sports, Inc. operates sporting goods stores in small to mid-sized markets primarily in the southeast, southwest, Mid-Atlantic, and Midwest regions of the United States. Its stores offer an assortment of merchandise, including athletic footwear, team sports equipment, athletic and fashion apparel, and related accessories. The company also provides its merchandise directly to educational institutions and youth associations. As of January 28, 2012, it operated 832 stores consisting of 812 Hibbett Sports stores, 19 smaller-format Sports Additions athletic shoe stores, and 1 larger-format Sports & Co. superstore in 26 states. The company was formerly known as Hibbett Sporting Goods, Inc. and changed its name to Hibbett Sports, Inc. in January 2007. Hibbett Sports, Inc. was founded in 1945 and is headquartered in Birmingham, Alabama.

10 Best Undervalued Stocks To Own For 2014: Varian Medical Systems Inc.(VAR)

Varian Medical Systems, Inc. designs, manufactures, sells, and services equipment and software products for treating cancer with radiotherapy, stereotactic radiotherapy, stereotactic body radiotherapy, stereotactic radiosurgery, and brachytherapy worldwide. Its Oncology Systems segment offers products, such as linear accelerators, brachytherapy afterloaders, treatment simulation and verification equipment, and accessories; and information management, treatment planning, and image processing software. This segment serves university research and community hospitals, private and governmental institutions, healthcare agencies, doctors? offices, and cancer care clinics. The company?s X-ray Products segment provides x-ray tubes for use in a range of applications, including computed tomography scanning, radiographic or fluoroscopic imaging, mammography, special procedures, and industrial applications; and flat panel digital image detectors for filmless x-ray imaging. It sells t hese products to imaging systems original equipment manufacturers that incorporate them into their medical diagnostic, dental, veterinary, and industrial imaging systems; independent service companies; and directly to end-users. The company also designs, manufactures, sells, and services Linatron x-ray accelerators, imaging processing software, and image detection products for security and inspection purposes, such as cargo screening at ports and borders, and nondestructive examination in various applications. In addition, it develops products and systems for delivering proton therapy; and technologies in the areas of digital X-ray imaging technology, volumetric and functional imaging, improved X-ray sources, and technology for security and cargo screening applications. The company was formerly known as Varian Associates, Inc. and changed its name to Varian Medical Systems, Inc. in April 1999. Varian Medical Systems, Inc. was founded in 1948 and is headquartered in Palo Alto , California.

Hot Performing Companies To Buy Right Now: Boom Logistics Ltd(BOL.AX)

Boom Logistics Limited provides crane logistics and lifting solutions to resource, energy, utilities, and infrastructure sectors in Australia. The company provides managed lifting solutions, contractual maintenance programs, crane integration for high rise construction, engineering services and maintenance, and equipment hire services. It also involves in the sale of cranes and crane parts; and the provision of repairs and maintenance services. The company offers a range of cranes, lifting equipment, and heavy haulage vehicles, as well as access and ancillary equipment. Its solutions include mobile, project, crawler, and tower cranes; heavy haulage vehicles, such as prime movers and low loaders; low profile prime movers; overhead jacking systems; and travel towers, under-bridge units, trailer lifts, spider lifts, boom lifts, knuckle boom lifts, scissor lifts, one man lifts, material lifts, material handlers, generators, and compressors. Boom Logistics Limited operates in a range of industry sectors, primarily industrial maintenance, commercial construction, resources and petro chemical industry, civil works, and heavy lifting sectors. It offers approximately 530 cranes and 2,500 items of access equipment. The company, formerly known as Australian Crane Company, was incorporated in 2000 and is based in Southbank, Australia.

Hot Performing Companies To Buy Right Now: Tutor Perini Corporation(TPC)

Tutor Perini Corporation, together with its subsidiaries, provides diversified general contracting, construction management, and design-build services to private clients and public agencies worldwide. It operates in three segments: Civil, Building, and Management Services. The Civil segment involves in public works construction, and the repair, replacement, and reconstruction of infrastructure. This segment?s civil contracting services include construction and rehabilitation of highways, bridges, mass transit systems, and wastewater treatment facilities. The Building segment provides services to various specialized building markets for private and public works clients, such as the hospitality and gaming, transportation, healthcare, municipal offices, sports and entertainment, education, correctional facilities, biotech, pharmaceutical, industrial and high-tech markets, electrical and mechanical, plumbing, and HVAC services. The Management Services Segment offers diversifie d construction and design-build services to the United States military and government agencies, surety companies, and multi-national corporations in the United States and internationally. This segment also provides rapid response and contract completion services; and management or general contracting services to fulfill the contractual and financial obligations of the surety on notification from the surety of a contractor bond default. The company was founded in 1894 and is headquartered in Sylmar, California.

Hot Performing Companies To Buy Right Now: Celanese Corporation (CE)

Celanese Corporation, a technology and specialty materials company, engages in manufacture and sale of value-added chemicals, thermoplastic polymers, and other chemical-based products. It operates through four business segments: Advanced Engineered Materials, Consumer Specialties, Industrial Specialties, and Acetyl Intermediates. The Advanced Engineered Materials segment offers specialty polymers for application in automotive, medical, and electronics products, as well as other consumer and industrial applications. The Consumer Specialties segment provides cellulose acetate flake, film, and tow that are primarily used in filter products applications; Sunett, a sweetener; and food protection ingredients, such as sorbates and sorbic acid for the food, beverage, and pharmaceutical industries. The Industrial Specialties segment produces emulsions and ethylene vinyl acetate (EVA) performance polymers. Its emulsions products are used in applications, such as paints and coatings, adhesives, construction, glass fiber, textiles, and paper; and EVA performance polymers are used in flexible packaging films, lamination film products, hot melt adhesives, medical products, automotive, carpeting and photovoltaic cells. The Acetyl Intermediates segment offers acetyl products, including acetic acid, vinyl acetate monomer, acetic anhydride, and acetate esters for use as starting materials for colorants, paints, adhesives, coatings, and medicines. It also provides organic solvents and intermediates for pharmaceutical, agricultural, and chemical products. The company offers its products directly, as well as through distributors and electronic marketplaces in North America, Europe, Africa, the Asia-Pacific, and South America. Celanese Corporation was founded in 2004 and is headquartered in Dallas, Texas.

Hot Performing Companies To Buy Right Now: Washington Real Estate Investment Trust(WRE)

Washington Real Estate Investment Trust is an equity real estate investment trust (REIT). The company engages in the ownership, operation, and development of real properties. The firm invests in real estate markets of the greater Washington D.C. metro region. It focuses on office, medical office, industrial/flex space, retail, and multifamily real estate investments. Washington Real Estate Investment Trust was founded in 1960 and is based in Rockville, Maryland.

Hot Performing Companies To Buy Right Now: Pelangio Exploration Inc (PX.V)

Pelangio Exploration Inc., a junior gold exploration company, engages in the acquisition, exploration, and development of mineral property interests. The company has a 100% interest in the Obuasi Property that covers approximately 290 square kilometers; and the Manfo Property, which covers approximately 100 square kilometers in Ghana, West Africa. It also holds a 100% interest in the Birch Lake and Poirier Gold properties in Ontario, Canada, as well as has interests in various properties located in Ontario and Quebec. Pelangio Exploration Inc. was incorporated in 2008 and is headquartered in Milton, Canada.

Wall Streets' Great Recession Cost Us All $30 Trillion

NEW YORK (TheStreet) -- The government generally made out OK from the economic fallout of the Great Recession -- but the economy is quite another story.

With the U.S. Federal Deposit Insurance Corp.'s recently announced sale of $2.4 billion in Citigroup (C) bonds, that marks the end of Uncle Sam's investment (or "bailout") in Wall Street investment banking firms.

While the U.S. government turned a tidy profit on the Citi deal, earning almost $15.5 billion from it, the financial damage inflicted on the nation and its citizens is both staggering and historic -- but not in a good way.

In fact, Americans may want to sit down as the Dallas Federal Reserve offers a final financial loss figure from the economic collapse of 2007-09 and resulting economic stagnation of the past five years. Also see: Report: 8.3M Homeowners Will Be Overwater, Able to Sell in 15 Months>> That tally comes in at $30 trillion once you factor in "additional costs arising from psychological consequences, skill atrophy from extended unemployment, a reduced set of economic opportunities and increased government intervention in the economy," as the American Enterprise Institute puts it. The Dallas Fed digs deep into the numbers -- not an easy exercise given all the moving parts involved in tallying up the damage done. In an economic letter released this month, Assessing the Costs and Consequences of the 2007-2009 Financial Crisis and Its Aftermath, the Dallas Fed notes that "any estimate of the toll exacted is bound to be incomplete -- for example, there may be future expenses not yet recognized -- so it's useful to calculate a range of likely costs."

The Fed breaks out its calculator and determines that the "bottom line" cost of the Great Recession ranges between $6 trillion and $14 trillion, but that seems like a conversation starter with additional considerations in the mix.

"The crisis consumed an enormous sum of financial and housing wealth," the Dallas Fed says, adding in its report that U.S. household net worth plunged $16 trillion, or 24%, from third-quarter 2007 to first-quarter 2009 and that the collapse also must take into consideration what the Fed calls "human capital," including current wage income and discounted future wage income (a household's expectation of potential earning power). Also see: How Our Display of Consumer Confidence Can Hurt Us>>

"If the effects of the crisis are permanent, the path of consumption observed since 2007 suggests that the cost of the crisis may be more than double the $6 trillion to $14 trillion estimate," the report says.

That gets the country to a numerical loss of anywhere between $12 trillion and $28 trillion -- so where does the $30 trillion figure come into play? The AEI weighs in at the higher end of the Dallas Fed's estimates, and even adds several trillion with the costs of an "oil-shocked-induced recession" that set the U.S. economy back by $2.1 trillion. Sum of the loss: about $30 trillion. That's a huge figure, and is one likely to induce sticker shock on average Americans as well as economists and global investors. But it's the one the country is left with, and is a vivid reminder of the lessons of 2007-09.

[video] Quick Take: Gold Traders Await Fed

NEW YORK (TheStreet) -- Gold prices will move following the release of the Federal Reserve's Open Market Committee results on Wednesday.

Mahir Dange, an options trader for Grafite Capital, told TheStreet's Joe Deaux that tapering has started to be priced in.

During a previous Fed meeting, when tapering became a common topic, gold rapidly traded down to the $1,175 level, before quickly bouncing higher. Dange said that near-term resistance was around $1,425 and that $1,351 was an important level, but gold traded straight through it on the downside.

Now Dange is focused on two new levels: $1,300 as support and $1,351 as resistance. A breakthrough of either of those levels will pave the way for the next $50 move in gold prices. He concluded that if the Fed down reduce stimilus, markets will likely rally higher. -- Written by Bret Kenwell in Petoskey, Mich. Follow @BretKenwell

Topeka Capital Downgrades Pioneer Natural Resources to “Hold” (PXD)

Topeka Capital reported on Monday that it is cut its rating on oil and gas company Pioneer Natural Resources (PXD).

The firm has downgraded PXD from “Buy” to “Hold,” due to a valuation call. Topeka Capital has also lowered the company’s price target from $200 to $195. This price target suggests a 5% upside from Friday’s closing price of $184.83.

Analyst Gabriele Sorbara commented: “Following the recent outperformance, we believe PXD is sufficiently valued on 2014/2015 EBITDA generation and relative to RNAV. While we believe PXD stands alone as the premier player with more than 700,000 net acres prospective for the Wolfcamp shale in the Midland Basin, the current valuation awards a paramount premium to the group.”

“Further, the numerous catalyst wells with 3Q13 results add no incremental value to our RNAV and growth upside, given our production and RNAV valuation model factor in a ramp to 50 horizontal rigs in the Midland Basin by 2018 – also presenting execution risk, in our view,” the analyst added.

Pioneer Natural Resources shares were mostly flat during pre-market trading Monday. The stock is up 73% YTD.

Deutsche Bank Cloud Computing Stocks to Buy That Are Changing Technology

Slowly, but surely, cloud computing is changing the way that technology is applied. The analysts at Deutsche Bank in a new research piece, have taken a deep-dive into the model and note that evolving software technologies have and continue to create new economic value. They are also of the opinion that subscription and consumption-based models will grow as a share of information technology spending, and they are cannibalizing traditional software at an accelerating pace. The analysts focused their work on companies that lean heavily to the domestic market, as our economy looks to lead the world forward. Here are the top cloud computing stock to buy at Deutsche Bank.

Adobe Systems Inc. (NASDAQ: ADBE) has been named by Gartner as a leader in their new report "Magic Quadrant for Web Management." Adobe was positioned highest in ability to execute and completeness of vision in the report. The evaluation criteria for a vendor's ability to execute included product/service, overall viability, sales execution/pricing, market responsiveness and track record, marketing execution, customer experience and operations. Deutsche Bank has a $52 price target for the stock. The Thomson/First Call estimate is at $51.

Demandware Inc. (NYSE: DWRE) posted strong second-quarter earnings yesterday. Subscription revenue in the second quarter was $20.8 million, a 37% increase over $15.2 million in the second quarter of 2012. The Deutsche Bank target for the stock is $42 and should go up after the beat. The consensus price target is lower at $39.

Guidewire Software Inc. (NYSE: GWRE) provides system software to the property and casualty insurance industry, primarily in the United States, Canada and Australia. It provides Internet-based software platforms for core insurance operations, including underwriting and policy administration, claim management and billing. Deutsche Bank sees the stock climbing to $50, while consensus target is $47. The Deutsche Bank price target is the highest on Wall Street.

Top 10 Penny Companies To Buy For 2014

LifeLock Inc. (NYSE: LOCK) is a top small cap name to buy that may hold big gains for investors. The company is a leader in identity-theft protection systems and crushed its recent earnings estimates. Deutsche Bank has an $18 target, and the consensus target is $15.50. A move to the Deutsche Bank target would be a gain of 50% for investors.

Salesforce.com Inc. (NYSE: CRM) continues to be the momentum investors’ dream stock. One of the original customer relationship management (CRM) software leaders, its earnings have continued to grow at a breakneck pace. Deutsche Bank has a $57 price target, and the consensus is posted higher at $65.

Synchronoss Technologies Inc. (NASDAQ: SNCR) was added to the Credit Suisse U.S. focus list on Monday. The company trounced earnings expectations and even topped its own sales estimates for the quarter. Cloud services grew 30% from a year ago and now comprise nearly a third of total revenue. Deutsche Bank has a $40 price target, and the consensus number is at $38.

Tangoe Inc. (NASDAQ: TNGO) is another small cap name with potential for huge upside. The company provides communications life cycle management software and services primarily to commercial enterprises and governmental agencies. The company offers an on-demand communications management platform (CMP), a suite of software designed to manage and optimize the complex processes and expenses associated with the life cycle of an enterprise’s fixed and mobile communications assets and services. The Deutsche Bank price target for the stock is at $28, while the consensus level is at $27. Trading to the target would represent a 60% gain for investors.

In the 1980s, the software industry started to disrupt the way companies conducted business and how consumers interacted with personal computers. Thirty years later, the software industry itself is undergoing an incredibly disruptive change, one driven by a new breed of vendors that leverage the latest cloud technologies. Adding cloud computing stocks to a portfolio is adding a slice of tomorrow and beyond for technology.

The U.S. Navy Loves This Micro Cap

As a concept, tidal power seems straightforward enough:

The ocean moves continuously without incurring any problematic conditions like lack of wind or sun, as is the case in the best-known renewable energy sources. With a constant source of motion, all that's needed to generate power is a drive shaft connected to a dynamo.

But a concept - by itself - doesn't make any money... especially in the "renewable energy" space. You need an effective product to make an impact.

That's why the U.S. Navy loves this little company...

It's Always High Tide for These Buoys

Harnessing tidal power involves using coastal waters - and their wave and tidal currents - as a continuous source of energy. And several recent tidal pilot projects have indicated that there is considerable potential here for significant power generation.

Infrastructure development, of course, requires more than proof of concept. And you also need some significant investment. But this is where things are picking up...

To further this cause, the U.S. Department of Energy has entered the discussion by providing a new $16 million round of funding for tidal power. It includes 17 initiatives to improve efficiency, along with some necessary data accumulation and environmental impact studies.

There is no doubt the potential here is impressive...

Current DOE estimates put the possible annual power to be obtained at more than 1,400 terawatt hours of electricity. That would be enough electricity to power millions of homes.

As with most efforts to develop what remains a niche source, most of the attempts thus far have been by smaller companies with limited capital and a restrained ability to stay afloat (no pun intended) until the market expands.

But Ocean Power Technologies Inc. (Nasdaq GM: OPTT) - a firm I have followed for some time - is different.

The whole company is worth just $16 million at the moment. But it's having success now using stationary buoys to generate power.

Any move into the tidal wave sector remains a high-risk investment move, to be sure. Ocean Power Technologies, for example, has lost 67.5% of its value since I began tracking the stock in early April of 2011.

However, there's still some merit here.

In addition to landing one of the new DOE grants, Ocean Power has one pretty important partner in its current projects.

It's the U.S. Navy.

In fact, through their Ocean Renewable Energy joint project, the two can lay claim to developing the first commercial grid connection for tidal power. The facility has been in operation since 2010 and is located at the Marine Corps Base Hawaii, in Oahu.

In addition, the Navy also recently announced an increase in activity at its related (and already operational) Hawaiian wave power test bed. The objective here, according to a report several months ago from the United States Pacific Fleet (USPACFLFT), is to provide an up-to-date shared Research and Development (R&D) platform for private sector wave power developers.

As the sector leader, Ocean Power Technologies is likely to be the first company to benefit from this decision.

Yet, even the ability to estimate tidal and wave patterns with any accuracy - thereby enabling a realistic efficiency measurement - is several years away.

So any move at this point into companies like OPTT remains a speculative one at best. Still, in the more diversified energy balance emerging, the tides will have their place.

In that case, working with the U.S. Navy is certainly a big plus.

Syrian Crisis Update

Meanwhile, the move to punish Syria has been slower to develop than anticipated last week. As a result, after a major move up, NYMEX futures contract oil prices have subsided 2% over the two trading sessions leading up to Labor Day. No matter. Once the decision is made to attack, the angst will return with force.

Markets dislike uncertainty, and pending military actions present the greatest uncertainty of all. That means there will be volatility moving forward. Expect it will now take at least another week before the U.S. Congress reconvenes to consider the Obama Administration's request for authorization to proceed.

Thus far, among the "fair weather allies," only the French appear committed to move. The British Parliament voted down the PM's request, but has left the door open pending the report from the UN review team.

In the interim, Washington has turned up the heat with several high-level public conclusions, including those by U.S. Secretary of State John Kerry, that clear evidence exists for: (1) Assad government's use of chemical weapons against his own people, (2) nerve gas (sarin) residue from the attack outside Damascus, with (3) more than 1,400 deaths confirmed as a result of the chemical attack.

There will be more disclosures as the return date for Congress approaches in a concerted attempt to drum up sufficient political support. Absent a UN report showing no chemical weapons were used (virtual impossibility), that support will materialize.

In short, I will have much more to say about what all of this means for the energy sector in due course.

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Intel Goes Deeper into Cloud and Data Center After Missing Mobile

Intel Corp. (NASDAQ: INTC) is unveiling new technology for cloud applications. The semiconductor and processor giant is bringing out new systems-on-chip (SoCs) to optical fiber for cloud-optimized products on network, storage, microservers and rack designs. Most investors know that Intel has missed out on much of the move to mobile processing, but now Intel is trying to rapidly expand other areas outside of its traditional dominance in processors for PCs and servers.

The company’s new portfolio of data center products and technologies is targeted toward cloud service providers, with greater efficiency and flexibility into infrastructure.

The market for servers and network and storage infrastructure is said to be migrating into the microserver, cold storage and entry networking segments. Intel plans to help cloud providers boost their utilization rates while driving down costs.

Intel’s new SoCs are the first Intel products based on the Silvermont micro-architecture and are coming out nine months after the previous generation. Supporting billions of devices and users simultaneously is changing how data centers have to operate. Intel claims to be providing “the key innovations that original equipment manufacturers, telecommunications equipment makers and cloud service providers require to build the data centers of the future."

Top 10 High Tech Companies To Watch For 2014

Intel also introduced the Intel Ethernet Switch FM5224 silicon. This is to be combined with the WindRiver Open Network Software suite and is expected to bring new solutions to servers for improved density and lower power. Also being released are Intel Rack Scale Architecture as well as customized and optimized Intel Atom SoCs for new and existing market segments.

We are not going to say that this effort makes Intel’s weak sales into smartphones and tablets much better. The move is still underway there and time is going to tell how Intel does on that front.

If you want to see the full releases with full products, that can be seen here. Intel shares were up 2.8% at $22.80 on last look against a 52-week range of $19.23 to $25.98.

At the Close: Market’s Big Gain Dissipates on Fed, Syria Uncertainty; Monster Beverage Falls 6%

So much hope. So much optimism. And so little to show for it.

Getty Images

After trading up as much as 1.1% this morning, the S&P 500 gained just 0.4% to 1,639.77 today, while the Dow Jones Industrials rose 0.2% to 14,833.96. The Nasdaq Composite advanced 0.6% to 3,612.61.

What made a positive day feel like we’re waiting for the next shoe to drop? Well, first there was good economic data. The Institute for Supply Management's August manufacturing index rose to 55.7 from 55.4 in July and beat economist forecasts. That caused Treasury yields to rise as speculation continued to build that the Fed would start tapering come its September meeting. Capital Economics’ Amna Asaf explains:

Another monthly increase in the US ISM manufacturing index to a 28-month high of 55.7 in August, after surging to 55.4 in July, suggests that the improvement in overseas activity appears to be benefiting US producers…

Overall, at 55.7, the headline index points to a further acceleration in GDP growth to around 3% annualised in the third quarter, up from 2.5% in the second. We doubt growth will be quite that strong, but clearly this is the sort of the news that could prompt the Fed to begin tapering its monthly asset purchases later this month.

Then there’s Syria, where Republicans and Democrats found that they actually can agree on something–blowing stuff up. Wells Fargo’s Sameer Samana discusses the implications for investors:

A potential attack on Syria has increased geopolitical uncertainty and dampened prospects for international equity and commodity markets over the coming months. Along with the Federal Reserve's stated intention to start tapering bond purchases in the near future, this additional headwind may lead markets to tread water in the near-term. Long-term investors should focus on our constructive outlook for the remainder of this year and beyond, and look for opportunities that may present themselves.

Merrill Lynch’s Savita Subramanian and team recommend buying energy stocks and selling consumer discretionary to protect portfolios from a spike in oil prices:

You Haven't Really Considered MLPs, Have You?

I thought not.  Master Limited Partnerships are a great investment for the right guy or gal.  The question is, is that guy or gal you?

This could be you.

If you don't understand MLPs, you have plenty of company.     Most simply, MLPs are publicly traded partnerships.  They typically earn 90% or more of their income from natural resource activities.  Think "pipelines" and you have it in a nutshell.  The biggest share of the 120 MLPs in existence today are involved in the distribution of oil or natural gas through pipelines.

 

Here is the business model: the pipes have a meter and they charge for the amount of oil or gas they pass.  While they are in the energy business, their fortunes do not particularly depend on energy prices, because people need oil and gas delivered whether it is expensive or cheap.  In this respect, they are like utilities.  There is a general partner, who operates the business (with various incentives), and limited partners — you, the unitholders — who provide capital and receive cash distributions from ongoing operations.

So far, this sounds fairly boring.  You get a steady stream of income from a low-beta source, just the thing for a retiree, perhaps, or someone looking for diversification.  Don't look for the next iPhone or Google Glass here.  It's only when we come to the subject of taxes that your units will perk up.

Consider this: we all need energy, and these are capital-intensive industries, yet at the end of this rainbow is a low-return asset: a rate-regulated pipeline.  The solution has been to lower their cost of capital by giving them a pass-through tax structure.  MLPs thus avoid the double taxation to which corporations are subject.

Nice for them, but what's in it for you (apart from the reliable quarterly distribution check)?  The pass-through status means that your distribution is not a dividend.  It is a sandwich of earnings plus depreciation less the amount of money spent on maintenance.  Under the tax code, this spells return of capital.  Thus, distributions — perhaps 3%-7% or more — are not fully taxed when received.  They are taxed only once, mostly when the units are sold.  For the right person, this tax angle presents a breathtaking opportunity.

An example

Let's walk through an oversimplified example.

On Jan 1, you buy $100,000 worth of units of MLP Pipeline, LP.

In the course of the year, you receive quarterly distributions adding up to a total of $6,000.

At the end of the year, you learn that these distributions amounted to  $6,000 of income and $5,000 of depreciation.

You only owe tax on the difference, or $1,000, at your marginal federal and state tax rates.   Let's say you are in a high bracket in a high tax state and have to pay $500.  That's $500 in current taxes on $6,000 of spending money deposited in your bank.

After a year and a day, you sell your units for $105,000.

What is your gain, from Uncle Sam's point of  view?  $5,000, you say?  No, it's $10,000.   You have $5,000 of long-term capital gains, the difference between the price for which you bought and sold the units.  Then you have another $5,000 in gain from your depreciation, which is now recaptured for tax purposes and taxed at marginal (not capital gains) rates. The longer you hold the MLP, the lower your cost basis sinks.  Hold on too long and the basis goes to zero, at which point all the distributions become taxable as ordinary income.

While deferred taxation is always pleasant, getting taxed at marginal rates is not.  The killer play is to use MLPs for estate planning, deferring this recapture to the point of extinction.  That way, you get the benefit of an ongoing and largely tax-deferred income stream, while eschewing the big tax hit at the end of the tunnel.

5 Best Insurance Stocks To Watch For 2014

The health insurance industry has confronted many external challenges in the recent past such as federal, state legislative and regulatory reforms; a challenge to meet the demand of more price- and service-conscious consumers, a fiercely competitive market, shift of customer mix and uncertain economic conditions in the U.S. and abroad, just to name a few.

Notwithstanding the headwinds, the industry is "thriving under stress." Most of the top players -- including CIGNA Corp. (CI), WellPoint Inc.
(WLP), Aetna Inc. (AET), Humana Inc. (HUM), Molina Healthcare (MOH) and Health Net, Inc. (HNT) -- reported ahead of the Zacks Consensus estimates in 2013 Q1, while UnitedHealth Group Inc. (UNH) reported in line. The earnings outperformance was driven by lower medical inflationary trends and strong operating performance.

5 Best Insurance Stocks To Watch For 2014: Aflac Incorporated(AFL)

Aflac Incorporated, through its subsidiary, American Family Life Assurance Company of Columbus (Aflac), provides supplemental health and life insurance. The company offers various voluntary supplemental insurance products, including cancer plans, general medical indemnity plans, medical/sickness riders, care plans, living benefit life plans, ordinary life insurance plans, and annuities in Japan. It also provides loss-of-income products, such as life and short-term disability plans; and products designed to protect individuals from depletion of assets, which comprise hospital indemnity, fixed-benefit dental, vision care, accident, cancer, critical illness/critical care, and hospital intensive care plans in the United States. The company sells its products through sales associates and brokers, affiliated corporate agencies, independent corporate agencies, and individual agencies. Aflac Incorporated was founded in 1955 and is headquartered in Columbus, Georgia.

Advisors' Opinion:

• [By Vita]

  AFLAC Inc. (NYSE:AFL): Down 1.75% to $31.46. Aflac, Inc. is a general business holding company. The Company, through its subsidiaries, provides supplemental insurance to individuals in the United States and Japan. Aflac’s products include accident/disability plans, cancer expense plans, short-term disability plans, sickness and hospital indemnity plans, hospital intensive care plans, and fixed-benefit dental plans.

5 Best Insurance Stocks To Watch For 2014: Aon Corporation(AON)

Aon Corporation provides risk management services, insurance and reinsurance brokerage, and human resource consulting and outsourcing services primarily in the United States, the Americas, the United Kingdom, Europe, the Middle East, Africa, and the Asia Pacific. The company?s Risk Solutions segment offers retail brokerage products and services, including affinity products, general underwriting management services, placement services, and captive management services; and advisory services to technology, financial services, agribusiness, aviation, construction, health care, and energy industries, as well as facilitates various risk management solutions for property liability, general liability, professional liability, directors' and officers' liability, workers' compensation, and various healthcare products. This segment also provides risk consulting services comprising captive management; eSolutions products that enable clients to manage risks, policies, claims, and safet y concerns through an integrated technology platform; reinsurance brokerage services, such as actuarial, enterprise risk management, catastrophe management, and rating agency advisory services; property and casualty reinsurance; and specialty lines, which include professional liability, medical malpractice, accident, life, and health, as well as capital management transaction and advisory services. Its HR Solutions segment offers human capital services in the areas of health and benefits, retirement, compensation, and strategic human capital; and benefits administration and human resource business process outsourcing services. The company was founded in 1919 and is headquartered in Chicago, Illinois.

Advisors' Opinion:

• [By Michael]

  Aon Corp. (NYSE: AON : 46.02, 0.87) registered net profit of $258 million or 75 cents per share in its Q2, up from $153 million, or 54 cents per share a year earlier. Analysts had forecasted earnings of 82 cents per share for the company. Total revenue during the quarter rose 48 percent to $2.8 billion. Shares had closed yesterday's trading at $49.39.

Top Value Stocks For 2014: AmTrust Financial Services Inc (AFSI.O)

Amtrust Financial Services, Inc., incorporated on November 7, 1990, is a holding company. The Company is a multinational specialty property and casualty insurer focused on generating consistent underwriting profits. The Company operates in four business segments: small commercial business, specialty program and personal lines reinsurance. The Company transacts business through 11 insurance company subsidiaries: Technology Insurance Company, Inc. (TIC), Rochdale Insurance Company (RIC), Wesco Insurance Company (WIC), Associated Industries Insurance Company, Inc. (AIIC), Milwaukee Casualty Insurance Company (MCIC), Security National Insurance Company (SNIC), AmTrust Insurance Company of Kansas, Inc. (AICK) and AmTrust Lloyd�� Insurance Company of Texas (ALIC). In January 2013, the Company acquired First Nonprofit Companies, Inc. In February 2013, the Company's subsidiary acquired Car Care Plan (Holdings) Limited (CCPH) from Ally Insurance Holdings, Inc.

Sma ll Commercial Business

Small Commercial Business segment provides workers��compensation to small businesses that operate in low and medium hazard classes, such as restaurants, retail stores, physicians and other professional offices, and commercial package and other property and casualty insurance products to small businesses. The Company is authorized to write its Small Commercial Business products in all 50 states. The Company distributes its policies through a network of over 8,100 select retail and wholesale agents who are paid commissions based on the annual policy premiums written. Commercial package products provide a range of insurance to small businesses, including commercial property, general liability, inland marine, automobile, workers��compensation, and umbrella coverage.

The Company maintains Small Commercial Business property and casualty claims operations in several of its domestic offices and the commercial package claims opera tion is separated into four processing units: casualty, pr! op! erty, cost-containment/recovery and a fast-track physical damage unit. As of December 31, 2012, its Small Commercial Business property and casualty claims were approximately 61% automobile and 13% property and inland marine with the remaining 26% involving general liability and umbrella losses.

Specialty Risk and Extended Warranty

The Company��Specialty Risk and Extended Warranty segment provides coverage for consumer and commercial goods and custom designed coverages, such as accidental damage plans and payment protection plans offered in connection with the sale of consumer and commercial goods in the United States and Europe, and certain niche property, casualty and specialty liability risks in the United States and Europe, including general liability, employers��liability and professional and medical liability. specialty risk business primarily covers, such as legal expenses in the event of unsuccessful litigation; property damage for resid ential properties; home emergency repairs caused by incidents affecting systems, such as plumbing, wiring or central heating; latent defects that materialize on real property after building or completion; payment protection to insureds if they become unable to meet financial obligations under finance contracts; guaranteed asset protection (GAP) to cover the difference between an insurer�� settlement and the asset value in the event of a total loss, and general liability, employers��liability, public liability, negligence of advisors and liability of health care providers and medical facilities.

The Company's extended warranty business covers selected consumer and commercial goods and other risks, including personal computers; consumer electronics, such as televisions and home theater components; consumer appliances, such as refrigerators and washing machines; automobiles (excluding liability coverage); furniture, and heavy equipment. The Company also serve a s a third party administrator to provide claims handli! ng and! c! all cen! ter services to the consumer products and automotive industries in the United States and Canada. It underwrites the specialty risk coverage on a coverage plan-level basis, which involves substantial data collection and actuarial analysis, as well as analysis of applicable laws governing policy coverage language and exclusions.

Specialty Program

The Company�� Specialty Program segment provides workers��compensation, package products, general liability, commercial auto liability, excess and surplus lines programs and other specialty commercial property and casualty insurance to a narrowly defined, homogeneous group of small and middle market companies. The type of risk covered by this segment is similar to the type of risk in Small Commercial Business but also covers, to a small extent, certain higher risk businesses. The coverage is offered through accounts with various agents to multiple insureds. Policyholders in this segment primarily include industries, such as retail, wholesale, service operations, artisan contracting, trucking, light and medium manufacturing, habitational and professional employer organizations. As of December 31, 2012, the Company underwrote 77 programs through 44 independent wholesale and managing general agents. Workers��compensation insurance consists approximately 33% of this business during the year ended December 31, 2012.

Personal Lines Reinsurance

The Company�� Personal Lines Reinsurance Segment has a 20% participation in the Personal Lines Quota Share, by which it receive 10% of the net premiums of the personal lines business. The Personal Lines Quota Share provides that the reinsurers, severally, in accordance with their participation percentages, will receive 50% of the net premium of the GMACI Insurers and assume 50% of the related net losses.

5 Best Insurance Stocks To Watch For 2014: Fairfax Financial Holdings Ltd (FRFHF)

Fairfax Financial Holdings Limited (Fairfax) is a financial services holding company. The Company, through its subsidiaries, is principally engaged in property and casualty insurance and reinsurance and the associated investment management. The Company�� segments consist of Insurance, Reinsurance, Insurance and Reinsurance Other, Runoff, and Corporate and Other. On December 22, 2011, the Company completed the acquisition of 75% interests in Sporting Life Inc. On August 16, 2011, the Company acquired William Ashley China Corporation. On March 24, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of The Pacific Insurance Berhad. On February 9, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of First Mercury Financial Corporation. In October 2012, its RiverStone runoff subsidiary acquired all the outstanding shares of Brit Insurance Limited.

5 Best Insurance Stocks To Watch For 2014: Old Republic International Corporation(ORI)

Old Republic International Corporation, through its subsidiaries, provides various insurance and mortgage guaranty products in North America. The company operates in three segments: General Insurance, Mortgage Guaranty, and Title Insurance. The General Insurance segment provides liability insurance coverages to businesses, government, and other institutions in commercial construction, forest products, energy, general manufacturing, and financial services industries; and transportation, including trucking and general aviation industries. It provides various insurance products, such as automobile extended warranty, aviation, commercial automobile insurance, general liability, home warranty, inland marine, travel accident, and workers? compensation, as well as liability coverage for claims arising from the acts of owners or employees, and protection for the physical assets of businesses. This segment also offers financial indemnity products, such as consumer credit indemnity , errors and omissions/directors and officers, guaranteed asset protection, and surety, as well as bonds that cover the exposures for losses of monies, or debt and equity securities due to acts of employee dishonesty. The Mortgage Guaranty segment insures first mortgage loans, primarily on residential properties incorporating one-to-four family dwelling units to mortgage bankers, brokers, commercial banks, and savings institutions. The Title Insurance segment provides lenders' and owners' title insurance policies to real estate purchasers and investors based upon searches of the public records. It also provides escrow closing and construction disbursement services; and real estate information products, national default management services, and services related to real estate transfers and loan transactions. Old Republic International Corporation markets its products directly, as well as through insurance agents and brokers. The company was founded in 1887 and is based in Chi cago, Illinois.

Best China Stocks To Own Right Now

The Motley Fool's readers have spoken, and I have heeded your cries. After months of pointing out�CEO gaffes�and faux pas, I've decided to make it a weekly tradition to also point out corporate leaders who are putting the interests of shareholders and the public first and are generally deserving of praise from investors. For reference, here's�my previous selection.

This week, we'll "step" into the retail sector and examine why Foot Locker (NYSE: FL  ) CEO, Ken Hicks, is truly a class act.

Kudos to you, Mr. Hicks
Ken Hicks took the reins at Foot Locker during one of the toughest times in recent retail history. Since becoming CEO on Aug. 17, 2009, Foot Locker's dividend-adjusted share price has catapulted by 268%, or an average of about 2.9% per month!

However, the retail industry certainly isn't a walk in the park -- even for Foot Locker. Shoe retailers and footwear companies have all struggled to some extent as higher payroll taxes and delayed tax refunds have weighed on consumer spending habits domestically. Overseas, slower GDP growth in China has drastically slowed down Nike's (NYSE: NKE  ) plans of dominating the region. In Nike's most recent quarterly report, it grew its sales in all regions, except for China and Japan, where it was forced to step up discounting to move higher-than-expected inventories.

Best China Stocks To Own Right Now: Euro/Yen(EJ)

E-House (China) Holdings Limited, through its subsidiaries, operates as a real estate services company in China. It provides primary real estate agency services, secondary real estate brokerage services, real estate information and consulting services, real estate advertising services, real estate promotional event services, real estate online services, and real estate investment fund management services. The company offers primary real estate agency services to real estate developers. Its secondary real estate brokerage services include offering advisory services on choices of properties; accompanying potential buyers on house viewing trips; drafting purchase contracts; negotiating price and other terms; and providing preliminary proof of title, as well as coordinating with the notary, the bank, and the title transfer agency. The company also provides real estate information services comprising data subscription services and data integration services; and real estate cons ulting services, including land acquisition consulting, development consulting, marketing consulting, and comprehensive solution consulting. In addition, it offers real estate advertising services consisting of advertising design and sales in print and other media; and real estate promotional event services, including securing venues, hiring caters and other various service providers, formulating event themes, and inviting speakers and guests for real estate promotional events. Further, the company provides real estate online services, including real estate news, information, property data, and access to online communities to real estate consumers and participants through local Web sites; and involves in real estate investment fund management activities that consist of investments in China?s real estate sector. E-House (China) Holdings Limited was founded in 2000 and is headquartered in Shanghai, the People?s Republic of China.

Advisors' Opinion:

• [By ChemTrade]

  Founded in 2000, E-House (EJ) is a leading real estate service company in China. It has a large scope of services, good brand recognition and a strong geographic presence. The company provides primary real estate agency services, secondary real estate brokerage services as well as real estate consulting and information services.

Best China Stocks To Own Right Now: Qihoo 360 Technology Co. Ltd.(QIHU)

Qihoo 360 Technology Co. Ltd. provides Internet and mobile security products in the People's Republic of China. Its principal products include 360 Safe Guard, an Internet security product for Internet security and system optimization; 360 Anti-Virus, an anti-virus application to protect users? computers against trojan horses, viruses, worms, adware, and other forms of malware; and 360 Mobile Safe, a security program for the Google Android, Apple iOS, and Nokia Symbian smartphone operating systems. The company?s platform products comprise 360 Safe Browser, a Web browser; 360 Personal Start-up Page, a default homepage of 360 Safe Browser and a key access point to popular and preferred information and applications; 360 Application Store, a key access point to securely obtain and manage software and applications; and 360 Safebox, a solution that protects users against thefts of personal account information. It also provides online advertising services, including online marketi ng services and search referral services; and Internet value-added services comprising the operation of Web games developed by third-parties, remote technical support, and cloud-based services. The company was formerly known as Qihoo Technology Company Limited and changed its name to Qihoo 360 Technology Co. Ltd. in December 2010. Qihoo 360 Technology Co. was founded in 2005 and is based in Beijing, the People?s Republic of China.

Top Stocks To Invest In: China Mobile(Hong Kong)

China Mobile Limited, an investment holding company, provides mobile telecommunications and related services primarily in the Mainland China. It offers various services comprising local calls, domestic long distance calls, international long distance calls, domestic roaming, and international roaming. The company also provides voice value-added services, including caller identity display, caller restrictions, call waiting, call forwarding, call holding, voice mail, and conference calls; customer-to-customer messages and corporate short message services; and mobile Internet access services. In addition, it engages in other data businesses, which primarily include multimedia messaging services; color ring services that enable users to customize the answer ring tone from various selection of songs, melodies, sound effects, or voice recordings; and mobile reading, mobile gaming, mobile video, mobile payment/wallet, mobile TV, mobile market, and Internet data center services. F urther, the company offers telecommunications network planning, design, and consulting services; roaming clearance services; technology platform development and maintenance services; and mobile data solutions, and system integration and development services, as well as operates a network and business coordination center. Additionally, China Mobile Limited sells mobile phone handsets and devices. As of March 31, 2011, it served approximately 600.8 million customers. The company was formerly known as China Mobile (Hong Kong) Limited and changed its name to China Mobile Limited in May 2006. China Mobile was founded in 1997. The company is based in Central, Hong Kong, and is considered a Red Chip company due to its listing on the Hong Kong Stock Exchange. China Mobile Limited is a subsidiary of China Mobile Hong Kong (BVI) Limited.

Best China Stocks To Own Right Now: BHP Billiton Limited(BHP)

BHP Billiton Limited, together with its subsidiaries, operates as a diversified natural resources company worldwide. The company engages in the exploration, development, and production of oil and gas; mining and refining of bauxite into alumina, and smelting of alumina into aluminum metal; and mining of copper, silver, lead, zinc, molybdenum, uranium, gold, diamonds, and titanium minerals, as well as development of potash deposits. It also involves in the mining and production of nickel products, manganese ore, and manganese metal and alloys, as well as in the mining of iron ore, metallurgical coal, and thermal coal. BHP Billiton Limited sells its copper, lead, and zinc concentrates, and alumina to smelters; copper cathodes to wire rod mills, brass mills, and casting plants; uranium oxide to electricity generating utilities; rough diamonds to diamond buyers and diamond manufacturers; nickel products to stainless steel, specialty alloy, foundry, chemicals, and refractory ma terial industries; metallurgical coal to steel producers; and energy coal to power stations, power generators, and industrial users. The company, formerly known as BHP Limited, was founded in 1885 and is headquartered in Melbourne, Australia.

Advisors' Opinion:

• [By Robert Hsu]

  The miner has agreed to purchase the iron-ore contract mining division of contractor Leighton Holdings, which services BHP Pilbara operations. This will allow the mining company to switch to an owner-operator model, leading to reduced cost and increased safety oversight.

  Iron ore accounts for about 40% of BHP’s earnings, and the move here is a good one for the company.

  In addition, BHP chairman Jacques Nasser recently discussed in an interview with China newswire Xinhua that his company is confident about sustained growth in China. Nasser said the global market turmoil has not changed the company’s view.

  Nasser said: "China will continue to grow. I was there recently, and I walked away believing their focus was right, that we may not see 10, 11, 12% growth anymore, but we will see 7, 8, 9% growth, and the texture of the growth may change." Buy BHP.

Best China Stocks To Own Right Now: 3SBio Inc.(SSRX)

3SBio Inc., a biotechnology company, engages in the research, development, manufacture, and distribution of pharmaceutical products in the People?s Republic of China. Its products include EPIAO, an injectable recombinant human erythropoietin to stimulate the production of red blood cells in patients with anemia and to reduce the need for blood transfusions; and TPIAO, a recombinant human thrombopoietin to treat chemotherapy-induced thrombocytopenia. The company also offers Intefen, a recombinant interferon alpha-2a product for the treatment of carcinoma of the lymphatic or hematopoietic system and viral infectious diseases; Inleusin, a recombinant human IL-2 product to treat renal cell carcinoma, metastatic melanoma, and thoratic fluid build-up caused by cancer and tuberculosis; and Iron Sucrose Supplement for treating anemia associated with iron deficiency, as well as for patients with end-stage renal disease requiring iron replacement therapy. In addition, its product pi peline comprises a high dosage EPIAO; NuPIAO, a second-generation EPIAO; TPIAO to treat idiopathic thrombocytopenic purpura; NuLeusin for metastatic melanoma and metastatic renal cell carcinoma; human papilloma virus vaccine for the prevention of cervical cancer; and an anti-TNF monoclonal antibody product candidate for treating rheumatoid arthritis, psoriasis, and other inflammatory diseases. Further, the company?s product pipeline includes Feraheme, an in-licensed intravenous iron replacement therapeutic agent used to treat iron deficiency anemia in chronic kidney disease patients and in patients requiring hemodialysis; and Nephoxil, an iron-based phosphate binder for the treatment of hyperphosphatemia in patients with ESRD. It sells its products directly, as well as through its network of distributors to various healthcare providers, including hospitals, clinics, and dialysis centers. The company was founded in 1993 and is headquartered in Shenyang, the People?s Republic of China.

Advisors' Opinion:

• [By Hilary Kramer]

  3SBio (NASDAQ:SSRX) is based in China, so it has suffered from the uncertainties that have hit the stock market there, but it’s a solid company that should achieve strong growth for years to come. The majority of sales come from two strong products, EPIAO and TPIAO, which have both benefited from improved regulations and access in China. 3SBio should increase revenues in excess of 20% over the next two years, but the stock is attractively valued at only 12 times the 2012 estimate of 95 cents a share. SSRX is an attractive buy at current prices.