Saturday, November 30, 2013

Stocks to Watch: Wal-Mart, Kohl's, Viacom

Among the companies with shares expected to actively trade in Thursday’s session are Wal-Mart Stores Inc.(WMT), Kohl's Corp.(KSS) and Viacom Inc.(VIAB)

Wal-Mart’s fiscal third-quarter earnings rose 2.8% as sales improved at its Sam’s Club stores, though revenue was weaker than expected. The world’s largest retailer narrowed its full-year earnings guidance and gave a mostly cautious profit view for the current quarter, pushing shares down.

Kohl’s third-quarter earnings fell 18% as the department-store chain reported weaker same-store sales and margins. Shares fell as earnings and revenue missed expectations and the retailer again cut its 2013 profit guidance.

Viacom’s fiscal fourth-quarter profit jumped 24% as the media giant benefited from growth in advertising and home-entertainment revenue, pushing results above estimates. Class B shares rose 3.2%.

Brooks Automation Inc.'s(BRKS) fiscal fourth-quarter earnings fell 95% as the technology-products company’s revenue slipped on weak demand from semiconductor customers and a much smaller tax benefit. Results beat expectations, but the company gave a weak outlook for the first quarter. Shares edged lower.

Cisco Systems Inc.'s(CSCO) fiscal first-quarter profit dropped 4.6% as the network-equipment company recorded charges tied to job cuts and a recent acquisition, more than offsetting rising revenue and gross margins. Revenue growth for the period missed expectations and Cisco issued a downbeat outlook for the current quarter, sending shares down.

Millennial Media Inc.'s(MM) shares slumped after the mobile advertising service provider reported third-quarter results that widely missed Wall Street expectations. Though the company’s sales jumped from a year ago, the growth wasn’t as strong as expected, and Millennial Media’s bottom line also came up short. Shares slid.

Netease Inc.'s(NTES) third-quarter profit rose 29% as the company continued to benefit from its Chinese Internet-gaming operations. But shares fell as earnings came in below Wall Street expectations.

Friday, November 29, 2013

The Deal: Doubt Lingers Over Investor's Support for AsiaInfo Buyout

NEW YORK (The Deal) -- AsiaInfo-Linkage  (ASIA) filed an amended proxy statement Wednesday regarding its $890 million acquisition by Citic Capital Holdings Ltd., a vehicle part owned by the sovereign investment fund China Investment Corp., showing that its disgruntled co-chairman still opposes the buyout. 

The buyout of the Beijing-based telecom customer service software maker remains somewhat in doubt over support from its co-chairman and largest shareholder Libin Sun, who owns 17.3% of AsiaInfo-Linkage stemming from the 2009 sale of his company Linkage Technologies International Holdings Ltd. to AsiaInfo. 

The deal with Citic, which involves a rollover investment from AsiaInfo co-founder Edward Tian, with 9.3% of the target, and James Ding, AsiaInfo's other co-chairman, with 1.4%, offers $12 per share for AsiaInfo-Linkage. Citic, which began its pursuit of the company in January 2012 following a previous investment relationship, owns 4.5% of AsiaInfo. 

The deal does not require a majority of the minority vote.  With its approach to AsiaInfo in January 2012, Citic said its interest in acquiring the company hinged on either Tian or Sun participating in the buyout. Citic asked both shareholders to roll equity but did not require that they both did so. Tian agreed to participate in a potential deal. Sun, however, said that he did not intend to partner with Citic and that the deal was financially inadequate and disruptive and that the company should remain independent. Sun told the special committee at the time that he would support a deal even at a higher price because he did not think Citic as an owner could add any value to the AsiaInfo.  Sun's opinion apparently has not changed. The proxy filing Wednesday with the Securities and Exchange Commission stated that Sun approached AsiaInfo and Citic separately to sell a portion of his shares in the public market under Rule 144 and that restrictions be lifted so that he could do so within a reasonable period of time. Sun also sought to sell some shares to the buyer group for liquidity purposes, but the talks did not address price. At the end of August, Sun informed Citic that he was no longer interested in exploring a share sale but asked Citic to raise the deal price to $13 per share, which would win his commitment to backing the buyout.  Citic said no, that its price was fair.  Sun, as a board member, did not vote in favor of the merger.  In August, Brandes Investment Partners LP, with a 5.2% stake, also complained about the deal price. In a letter filed as a 13D with the SEC, Brandes expressed disappointment that the buyout did not include a majority of the minority vote and requested the special committee reopen that issue.  CITIC had demanded a majority only vote in early deal negotiations.  In the letter, Brandes also said the deal price was too low and the financial analysis provided by Goldman, Sachs & Co. was based on assumptions that changed over the protracted deal talks. Brandes said the combination of a high discount rate, a low growth assumption and use of precedent transactions based on cyclically depressed cash flows undervalues the long-term prospects of AsiaInfo. Brandes asked for a price materially above $12, in order to win its support for the deal.  AsiaInfo shares traded Wednesday for $11.61 at a spread of 39 cents, or 3.3%. If the buyout closes in mid-December that represents an annualized return of about 25%.  The deal will likely get the vote, an arb said. But China buyouts trade at wider spreads. The downside, if the transaction does not win approval is substantial as AsiaInfo came from about $7.50 prior to the public interest of Citic in January 2012.

Written by Scott Stuart  

Thursday, November 28, 2013

Two Low-Priced Stocks For Yield Hogs

We don't typically think of the low-priced stock universe as a haven for income plays, but I've picked up a few nice ones in the past, including MCG Capital (MCGC) and RAIT Financial Trust (RAS).

Today, lets look at two more, one from a sector often associated with income and another surprising choice.

The latter is upper-Midwest supermarket operator Roundy's (RNDY), which comes our way via the Low-Priced Insider Buying screen and presently yields about 5.4%.

With margins in this business typically being razor thin, investors tend to assume staying afloat and battling Wal-Mart's persistent expansion into grocery would preclude executives from giving a moment of thought to dividends.

Actually, though, the business can be quite profitable—yes, margins are thin but turnover tends to be very high—and Wal-Mart, as powerful as it can be, isn't the end-all and be-all of everything. RNDY definitely feels a competitive pinch, but its efficient operations allow it to come closer to Wal-Mart prices than most other local rivals.

The company has two efforts that particularly stand out on the basis of convenience, store ambiance and product selection emphasizing RNDY's perishables and company-brand products, both of which are outperforming company averages.

One is the emerging Mariano's chain in Chicago and the other is the upgraded Pick 'n Save chain in Milwaukee both of which seem poised for breakout years in 2o14. Meanwhile, over the trailing 12 months, the dividend amounted to only 55% of that portion of cash from operations left over after capital spending.

There may also be a special situation angle here. On a recent conference call, an analyst characterized RNDY was a tale of two companies (Mariano's and the new Pic 'n Save, and the rest of RNDY) and started lobbying management in the direction of some sort of corporate split. These were analysts talking, not executives, but such a ball, once it gets started, tends to keep on rolling.

Frontier Communications (FTR), which comes to us via the Low-Priced Value screen, is a company you'd expect to pay a good dividend. It's the fourth largest ILEC, incumbent local exchange carrier, better known as a traditional landline phone company.

Like the others, it's struggling to compete against the modern alternatives: wireless, cable-company phone service, and Internet telephony. Given investor concern with this sort of business, the yield has been pushed up to a level that reflects high risk: 9.1%. But FTR's dividend, after having been reduced at the start of 2012, is now very well covered by cash flows.

Over the past 12 months, the payout amounted to 53% of that portion of cash from operations remaining after capital spending. Meanwhile, Frontier, which serves rural and small- and medium-sized cities, is taking a particularly local and proactive approach to marketing, including such approaches as door-to-door, having technicians sell while on service calls, local events, etc.

Low-cost, high-speed, broadband offerings have been selling well and FTR is experiencing better customer retention trends.

Excerpted from October issue of Forbes Low Priced Stock Report.

Marc Gerstein is editor of Forbes Low Priced Stock Report, research director at Portfolio123 and author of Screening the Market (Wiley, 2002).

Wednesday, November 27, 2013

Why Silver Prices Are About to Lift Off

While silver demand among U.S. traders at the moment is muted, silver demand in India - the world's biggest buyer of the white metal - is insatiable.

It will be one of the biggest factors supporting higher silver prices in 2014.

And it all stems from a move the government made to limit gold buying...

India - the world's biggest gold buyer - imposed heavy import duties on the yellow metal this year to try and narrow India's swollen trade gap. The government raised the import duty on gold three times this year to 10%.

In July, the government told importers that one-fifth of their purchases would have to be turned around for export. Only 80% would be available for domestic use.

As these import numbers show, silver has become the "go-to" precious metal for India's investors.

It's the greatest silver buying opportunity in history - but this is your last chance...

India Driving Silver Higher in 2014

Data released early last week showed Indian silver imports are set to hit a record this year.

According to metals consultancy firm GFMS, India imported 4,073 tons of silver from January to August. That was more than double the 1,921 tons in all of 2012, when a spike in prices during the peak season pressured demand. The record high was set in 2008 when India imported 5,048 tons.

"Ever since the government has started putting measures to curb gold imports, demand for silver has seen a sudden surge," Monal Thakkar, president of Amrapali Industries, a leading Ahmedabad-based stock and commodity brokerage house, told the Business Standard. "Moreover, there is a general scare in the market that the government might soon start curbing silver imports also, as a result, traders are stocking up silver."

But the fresh spike in silver buying is unlikely to result in a similar policy response from authorities since the value of imported silver is much lower than gold and is not critical to the country's trade balance.

Industry experts expect demand for silver to remain high in India as long as gold prices and import taxes stay elevated.

Also contributing to the silver frenzy in India is the uptick in disposable income in rural areas due to a "good" monsoon season. While the June to September rains can be deadly, they are essential to the country's agriculture and economy.

"There is less gold available so rural people will gradually move to silver. It will be more of a default option than a conscious choice," Rajesh Khosla, managing director with refiner MMTC PAMP told Reuters.

Whether as a gold substitute, an alternative investment, or a safe haven asset, silver will be profitable for investors.

The increased interest in silver will be a major price catalyst into 2014 - giving the white metal an edge over gold.

"Going forward, the recovery will be sharper in silver compared to gold," Gnanasekar Thiagrajan, director with Commtrendz Research told Reuters.

Find out all you need to know about buying silver here.

Related Articles:

The Economic Times:
India May Import Record Volumes of Silver Reuters:
Indians May Import Record Volumes of Silver Business Standard:
As Investors Seek Silver Lining, Metal's Import up 311%

Monday, November 25, 2013

Davita, Fresenius Rise; Faces Smaller Medicare Cut

The Centers for Medicare and Medicaid decided today to cut government payment to dialysis clinics. So why did share prices for DaVita HealthCare Partners (DVA) and rival Fresenius Medical Care (FMS) rise so steeply today?

The agency, which administers government-funded health plans for the elderly and the poor, decided to cut payments to dialysis clinics by less than expected.

DaVita soared 9% to $61.64, while Fresenius rose 7.3% to $34.58.

Medicare is transitioning to a new payment mechanism that effectively preserves the payments to dialysis providers over the next two years. The total cuts amount to less than 1% in 2014 and 2015, in contrast to proposed cuts of as much as 12%, according to The Wall Street Journal.

Best Canadian Companies To Invest In Right Now

Nonetheless, cuts of nearly $30 per treatment over the next two years will flatten out payments "in an environment of increasing expenses," LeAnne Zumwalt, group vice president at DaVita, said in a statement released Friday.

Sounds ominous. Yet Deutsche Bank analyst Darren Lehrich raised his price target on Buy-rates  DaVita to $72 from $68. He writes:

While CMS didn’t soften the drug re-basing cut amount from its original proposal, the overall impact from the final rule is better than how we had modeled it for DVA (we assumed Medicare revenue down ~$6/tx in 2014-2015). As such, we are taking estimates up slightly, and we are also bumping our PT to $72 (from $68) on these new numbers (still using 14x cash EPS / 8x EV/EBITDA as target forward multiples). We are not flowing all of the change to EBIT because we are also making a few other revisions/refinements to our model. Having cleared an important hurdle with this rule, DVA shares look attractive, and we are reiterating our Buy.

Saturday, November 23, 2013

Is ZAGG Destined for Greatness?

Investors love stocks that consistently beat the Street without getting ahead of their fundamentals and risking a meltdown. The best stocks offer sustainable market-beating gains, with robust and improving financial metrics that support strong price growth. Does ZAGG (NASDAQ: ZAGG  ) fit the bill? Let's look at what its recent results tell us about its potential for future gains.

What we're looking for
The graphs you're about to see tell ZAGG's story, and we'll be grading the quality of that story in several ways:

Growth: Are profits, margins, and free cash flow all increasing? Valuation: Is share price growing in line with earnings per share? Opportunities: Is return on equity increasing while debt to equity declines? Dividends: Are dividends consistently growing in a sustainable way?

What the numbers tell you
Now, let's look at ZAGG's key statistics:

ZAGG Total Return Price Chart

ZAGG Total Return Price data by YCharts

Passing Criteria

3-Year* Change

Grade

Revenue growth > 30%

311.8%

Pass

Improving profit margin

(74.9%)

Fail

Free cash flow growth > Net income growth

48,060% vs. 3.2%

Pass

Improving EPS

(19.5%)

Fail

Stock growth (+ 15%) < EPS growth

(12.3%) vs. (19.5%)

Fail

Source: YCharts.
*Period begins at end of Q3 2010.

ZAGG Return on Equity (TTM) Chart

ZAGG Return on Equity (TTM) data by YCharts

Passing Criteria

3-Year* Change

Grade

Improving return on equity

(86.4%)

Fail

Declining debt to equity

15,250%

Fail

Source: YCharts.
*Period begins at end of Q3 2010.

How we got here and where we're going
Things don't look good for ZAGG in its second assessment, as the accessories manufacturer dropped two of the four passing grades it scored last year to finish with a middling two out of seven passing grades. It's been a rough year for ZAGG, as the company's stock has shed 46% of its value in 2013, a decline only accentuated by the departure of CEO Robert Pedersen. ZAGG has been facing fierce competition from other third-party accessories suppliers, which has resulted in serious margin compression over the past few years. Can ZAGG turn it around, or is this company's future not all it's cracked up to be?

ZAGG's coming off a rather miserable stretch of weakness. The company had to  reduce its guidance twice over the summer and let down investors who were anticipating a rebound by posting a whopping 17% decline in sales for its latest quarter. Longtime Fool Rick Munarriz notes that Apple (NASDAQ: AAPL  ) has been increasingly banking on its own accessories, which has combined with a tighter third-party field of competition to crowd out ZAGG's formerly snug position. Apple, whose accessories market is estimated to be worth around $2 billion, has sought out tighter control of these secondary products as a way to generate add-on revenues. However, ZAGG might benefit from Apple's rumored curved-screen iPhone next year, as customers are likely to need some highly customized defenses and other accessories to fit the unusual shape.

Over the past few quarters, the company has been trying to diversify away from its traditional offerings (primarily the invisibleSHIELD), which accounts for nearly half of ZAGG's sales. ZAGG launched a keyboard called "Caliber Advantage," which adds traditional gamepad controls to Apple's iPhone, earlier this year. According to NPD Group, physical game spending fell by 21% in 2012, while digital content spending improved nearly 16% -- a trend clearly illustrating the shift toward gaming on mobile devices, which ZAGG could now begin to capitalize on.

On the other hand, ZAGG's also faced significant headwinds because of the perception that its offerings are commoditized or simply irrelevant. Fool contributor Rex Moore notes that Corning's (NYSE: GLW  ) ever advancements in Gorilla Glass, undermine ZAGG's protective-screen business by essentially catering to the same problem. Furthermore, ZAGG's move into the audio accessories market, which is largely dominated by Skullcandy (NASDAQ: SKUL  ) , couldn't drive much sales growth as the company has to face Skullcandy's discounts -- the headphones segment is becoming highly commoditized, with relatively few exceptions. The mobile-computing accessories market is expected to grow to $60 billion by 2015, but in order to grab a larger slice of that pie, ZAGG will have to find the killer edge that will differentiate it in a tightly packed field.

Putting the pieces together
Today, ZAGG has few of the qualities that make up a great stock, but no stock is truly perfect. Digging deeper can help you uncover the answers you need to make a great buy -- or to stay away from a stock that's going nowhere.

Are you investing in the wrong smartphone stocks?
Truth be told, one company sits at the crossroads of smartphone technology as we know it. It's not your typical household name, either. In fact, you've probably never even heard of it! But it stands to reap massive profits no matter who ultimately wins the smartphone war. To find out what it is, click here to access the "One Stock You Must Buy Before the iPhone-Android War Escalates Any Further."

Friday, November 22, 2013

10 Foods You'll Have to Give Up to Avoid Eating GMOs

Blonde geek holding cooking pot.Getty Images About 20 years ago, a company now owned by Monsanto (MON) introduced the Flavr Savr tomato -- the first genetically modified organism approved for consumption in the United States. Since then, farmers across the country have been using more and more GMOs every year. It's a practice that has come under increasingly intense scrutiny. Activists who are worried about the potential for human health problems, as well as environmental damage, have started demanding that food containing GMOs be labeled as such. Prop 37, a California ballot measure to mandate GMO labeling, failed at the polls in 2012, and a similar measure lost last month in Washington state. In both campaigns, the largest makers of GMOs -- Monsanto, DuPont (DD), and Dow Chemical (DOW) -- provided the ad funding that helped turn the tide. But what many people don't realize is that they've been consuming products with GMO ingredients for years. The Institute for Responsible Technology has a brochure breaking down GMO presence in many different types of foods. Here are 10 of the most popular foods that likely contain GMOs. Pre-made soups can contain a large number of ingredients containing GMOs. For instance, Campbell's (CPB) popular condensed Tomato Soup lists high fructose corn syrup as its second biggest ingredient. According to the Non-GMO Project, nearly 88 percent of all corn planted in the United States is GMO.

Wednesday, November 20, 2013

Ford’s Fields downplays reports Mulally will leave

The heir-apparent to Ford CEO Alan Mulally today downplayed reports that Mulally will be leaving to run Microsoft.

"There is no change to what we announced in November," Mark Fields, Ford's chief operating officer, said of Mulally's announcement he would stay at Ford through next year.

While Mulally has said he will stay at Ford through 2014, the board has indicated it would not stand in his way if he chooses to leave earlier.

Fields was responding to continued media reports that Mulally is a frontrunner to succeed Steven Ballmer as CEO of Microsoft. Other strong candidates are Nokia's Stephen Elop and Microsoft's Tony Bates.

EARLIER: Mulally on track to lead Microsoft?

FIRST TAKE: Mulally could bring wisdom to tech

If the 68-year-old Mulally does leave, Fields is the heir apparent. As part of succession planning, Ford's board of directors promoted Fields, 52, last year to the new No. 2 position of COO.

10 Best Oil Stocks To Invest In 2014

Fields today said he is focused on his COO job, running Ford's day-to-day operations and chairing the weekly meeting that keeps the company on track while Mulally works on long-term planning — but still attends many of the Thursday meetings that he instituted when he arrived at Ford.

Fields said he finds his new role "very fulfilling" and he loves working with the top management team while Mulally is focused on the big picture. Fields said all the speculation about Mulally leaving is not proving distracting.

Mulally has put his stamp on the automaker since he was hired from Boeing seven years ago and is credited with changing a culture of infighting into a more cohesive team dedicated to corporate turnaround and excellence.

Fields oversaw the Americas before his promotion. North America has been the revenue driver for the global automaker that continues to lose money in Europe, while investing heavily in plants an! d new products for Asia Pacific.

Fields spoke after a kickoff event for the 2013 United Way campaign for Southeastern Michigan. He is the campaign chairman.

Tuesday, November 19, 2013

5 Best Blue Chip Stocks To Watch For 2014

After yesterday's sluggish showing in which the Dow Jones Industrial Average (DJINDICES: ^DJI  ) lost 138 points on concerns over global manufacturing and slow hiring, blue chips rebounded Thursday, nearly erasing all of Wednesday's losses. Today's surge stemmed partially from a move that many economists already expected: the European Central Bank cut the benchmark refinancing rate from 0.75% to 0.5%, attempting to encourage borrowing to stimulate growth.�

What economists didn't see coming was a sudden drop in claims for jobless benefits, which reached the lowest level in more than five years. Stocks responded by firing on all cylinders, as 90% of Dow components climbed. And none rose more rapidly than Cisco Systems (NASDAQ: CSCO  ) , which added 1.8% after a serious stumble yesterday caused by concerns over rival Arista Networks' new super-fast data switch offering.�

While technically the third largest gainer of the day, Chevron's (NYSE: CVX  ) considerable weight in the index makes the oil giant's 1.5% gains worthy of discussion. Chevron shares enjoyed a boost today after an Ontario judge blocked legal efforts by a law firm to seize some of Chevron's foreign assets -- an attempt based on an $18 billion ruling against the company in Ecuador.�

5 Best Blue Chip Stocks To Watch For 2014: McDonald's Corporation(MCD)

McDonald?s Corporation, together with its subsidiaries, operates as a worldwide foodservice retailer. It franchises and operates McDonald?s restaurants that offer various food items, soft drinks, coffee, and other beverages. As of December 31, 2009, the company operated 32,478 restaurants in 117 countries, of which 26,216 were operated by franchisees; and 6,262 were operated by the company. McDonald?s Corporation was founded in 1948 and is based in Oak Brook, Illinois.

Advisors' Opinion:
  • [By Sean Williams]

    The restaurant sector is extremely competitive to begin with, so any negative publicity can crush a company, regardless of its size or dominance, over the short term. This week has been something of a nightmare for fast-food restaurant chains McDonald's (NYSE: MCD  ) and Burger King Worldwide (NYSE: BKW  ) .

  • [By Alex Planes]

    Mickey D's in the Middle Kingdom
    �The 1997 research paper Golden Arches East, edited by James L. Watson, offers this fascinating tidbit on McDonald's (NYSE: MCD  ) debut in Beijing:

5 Best Blue Chip Stocks To Watch For 2014: Apple Inc.(AAPL)

Apple Inc., together with subsidiaries, designs, manufactures, and markets personal computers, mobile communication and media devices, and portable digital music players, as well as sells related software, services, peripherals, networking solutions, and third-party digital content and applications worldwide. The company sells its products worldwide through its online stores, retail stores, direct sales force, third-party wholesalers, resellers, and value-added resellers. In addition, it sells third-party Mac, iPhone, iPad, and iPod compatible products, including application software, printers, storage devices, speakers, headphones, and other accessories and peripherals through its online and retail stores; and digital content and applications through the iTunes Store. The company sells its products to consumer, small and mid-sized business, education, enterprise, government, and creative markets. As of September 25, 2010, it had 317 retail stores, including 233 stores in the United States and 84 stores internationally. The company, formerly known as Apple Computer, Inc., was founded in 1976 and is headquartered in Cupertino, California.

Advisors' Opinion:
  • [By Evan Niu, CFA]

    Over the decades, there has been a long history of Microsoft (NASDAQ: MSFT  ) copying Apple (NASDAQ: AAPL  ) . This trend most notably started with the graphical user interface, or GUI, that the Mac first brought to consumer PCs and was subsequently followed by Windows.

  • [By Sue Chang and Saumya Vaishampayan]

    $AAPL: Apple (AAPL) �shares climbed 1.8%, among the top gainers in the S&P 500 (SPX) �. The stock was raised to a buy rating from hold on Monday by Jefferies, which also raised its price target to $600 from $425. The move came after Jefferies analysts met with Apple�� suppliers in Asia, who have become ��ar more lenient on price,��which will lift gross margins. Analyst Peter Misek also said Apple�� price is likely to appreciate ahead of the iPhone 6 launch.

  • [By Diane Alter]

    Money Morning knows that savvy investors make money in all market scenarios. With that in mind, following is a recap of some of the best stocks to buy now that Money Morning featured last week.

    Best Stocks to Buy Now The political unrest in Syria has caused an oil-price spike. Fears are growing that a prolonged conflict could spread to neighboring oil-rich countries, disrupt supplies, and send oil prices soaring some $10 to $20 a barrel. Money Morning Global Energy Strategist Dr. Kent Moors details how investors can play oil's "Syrian Premium."
    September is historically the worst month for stocks, and this September could be especially rocky as we approach the U.S. Federal Reserve's crucial Sept. 17-18 FOMC meeting. Money Morning Global Investing and Income Strategist Robert Hsu says he expects stocks to remain range bound heading into the central bank gathering. But, he tells readers how to make money from this tight trading range with one simple trade that lasts 10 days and gives investors the perfect blend of low risk and high probability. The key to a successful business can be summed up simply as having high profit margins. While revenue growth for U.S. businesses has been strong so far in 2013, with steady growth expected going forward, profit margins have only showed slight improvement. In How Investors Can Unlock the Power of Profit Margins, we explain how readers can find companies with the best sustainable profit margins and share three fantastic finds. Investors on the prowl for the best stocks to buy now frequently hunt among those involved in the shale oil boom. North America is undergoing an energy revolution. One formation in the western United States was certified by the United States Geological Service (USGS) as having 3 trillion barrels of oil. New supplies of oil and gas are bein
  • [By Rick Munarriz]

    There were a whopping 49.2 million tablets shipped during the first three months of this year, well ahead of the 20.3 million devices that shipped during the first quarter of 2012. However, Google's (NASDAQ: GOOG  ) Android and Apple's (NASDAQ: AAPL  ) iOS combined for more than 96% of the market.�

Hot Financial Stocks To Watch For 2014: Chevron Corporation(CVX)

Chevron Corporation, through its subsidiaries, engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. It operates in two segments, Upstream and Downstream. The Upstream segment involves in the exploration, development, and production of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines; and transportation, storage, and marketing of natural gas, as well as holds interest in a gas-to-liquids project. The Downstream segment engages in the refining of crude oil into petroleum products; marketing of crude oil and refined products primarily under the Chevron, Texaco, and Caltex brand names; transportation of crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacture and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It a lso produces and markets coal and molybdenum; and holds interests in 13 power assets with a total operating capacity of approximately 3,100 megawatts, as well as involves in cash management and debt financing activities, insurance operations, real estate activities, energy services, and alternative fuels and technology business. Chevron Corporation has a joint venture agreement with China National Petroleum Corporation. The company was formerly known as ChevronTexaco Corp. and changed its name to Chevron Corporation in May 2005. Chevron Corporation was founded in 1879 and is based in San Ramon, California.

Advisors' Opinion:
  • [By Dan Caplinger]

    Some stocks didn't manage to recover from early losses, however. Chevron (NYSE: CVX  ) finished the day down 0.8%, extending its losses over the past few days. Given crude oil's price gain of nearly $1 per barrel today, most of Chevron's energy-company peers managed to post at least modest rebounds today, even though the sector has underperformed the broader market throughout the rally of the past six months. Investors might be concerned that the unfreezing of the company's assets in Argentina might lead Chevron to make greater investment in the country, potentially exposing it to future nationalizations of assets that could end up costing Chevron even more in lost assets. Avoiding political risk will be key for the company as it navigates various world energy markets.

5 Best Blue Chip Stocks To Watch For 2014: International Business Machines Corporation(IBM)

International Business Machines Corporation (IBM) provides information technology (IT) products and services worldwide. Its Global Technology Services segment provides IT infrastructure and business process services, including strategic outsourcing, process, integrated technology, and maintenance services, as well as technology-based support services. The company?s Global Business Services segment offers consulting and systems integration, and application management services. Its Software segment offers middleware and operating systems software, such as WebSphere software to integrate and manage business processes; information management software for database and enterprise content management, information integration, data warehousing, business analytics and intelligence, performance management, and predictive analytics; Tivoli software for identity management, data security, storage management, and datacenter automation; Lotus software for collaboration, messaging, and so cial networking; rational software to support software development for IT and embedded systems; business intelligence software, which provides querying and forecasting tools; SPSS predictive analytics software to predict outcomes and act on that insight; and operating systems software. Its Systems and Technology segment provides computing and storage solutions, including servers, disk and tape storage systems and software, point-of-sale retail systems, and microelectronics. The company?s Global Financing segment provides lease and loan financing to end users and internal clients; commercial financing to dealers and remarketers of IT products; and remanufacturing and remarketing services. It serves financial services, public, industrial, distribution, communications, and general business sectors. The company was formerly known as Computing-Tabulating-Recording Co. and changed its name to International Business Machines Corporation in 1924. IBM was founded in 1910 and is based in Armonk, New York.

Advisors' Opinion:
  • [By Alex Planes]

    Tabulating a dynasty
    IBM (NYSE: IBM  ) was created on June 16, 1911, as the result of a merger between three technically inclined manufacturing businesses. It was known as the Computing-Tabulating-Recording Company until 1924 -- the same year that Ford built its 10 millionth Model T. CTR, as it was sometimes known, traced its origins to an inventor named Herman Hollerith, who devised a punched-card tabulator that offered tremendous time savings for enterprises (like the U.S. Census) engaged in the tedium of tallying up vast quantities of data. However, it wasn't Hollerith who built IBM into the business-services behemoth you know today. Much of IBM's character was formed during the tenure of the two Thomas Watsons, a legendary father-and-son executive pair that guided the company for more than half a century. You can read more about IBM's origins and its Watson-driven rise to prominence when you click on this link.

  • [By Jim Jubak]

    This quarter, big economic bellwether stocks such as IBM (IBM) and Kellogg (K) have shown signs that the days of being able to use stock buybacks and cost cutting to generate growth in earnings per share, even when revenue isn't growing, may be numbered. Or, at least, that the market's enthusiasm might be waning.

  • [By Rich Duprey]

    A 10-year, $600 million contract awarded by the Central Intelligence Agency could provide�Amazon.com (NASDAQ: AMZN  ) �stock with a big boost, pitting its web services division against more traditional providers like IBM (NYSE: IBM  ) and Hewlett-Packard (NYSE: HPQ  ) .

  • [By Beth Piskora]

    They are listed below:

    Altera (ALTR)��ielding 1.7%

    Apple (AAPL)��ielding 2.5%

    Applied Materials (AMAT)��ielding 2.6%

    Cisco (CSCO)��ielding 2.9%

    EMC Corp. (EMC)��ielding 1.5%

    International Business Machines (IBM)��ielding 2.0%

    KLA-Tencor (KLAC)��ielding 3.2%

    Microchip Technology (MCHP)��ielding 3.6%

    Oracle (ORCL)��ielding 1.5%

    Qualcomm (QCOM)��ielding 2.1%

    Texas Instruments (TXN)��ielding 2.9%

    Xilinx (XLNX)��ielding 2.3%

    Subscribe to S&P's The Outlook here��/P>

5 Best Blue Chip Stocks To Watch For 2014: Visa Inc.(V)

Visa Inc., a payments technology company, engages in the operation of retail electronic payments network worldwide. It facilitates commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses, and government entities. The company owns and operates VisaNet, a global processing platform that provides transaction processing services. It also offers a range of payments platforms, which enable credit, charge, deferred debit, debit, and prepaid payments, as well as cash access for consumers, businesses, and government entities. The company provides its payment platforms under the Visa, Visa Electron, PLUS, and Interlink brand names. In addition, it offers value-added services, including risk management, issuer processing, loyalty, dispute management, value-added information, and CyberSource-branded services. The company is headquartered in San Francisco, California.

Advisors' Opinion:
  • [By Mani]

    Visa Inc. (NYSE: V) is expected to report its fiscal fourth quarter and full-year 2013 financial results on�Wednesday, Oct. 30, 2013. Visa's executive management team will host a live audio webcast beginning at 5:00 p.m. Eastern Time (2:00 p.m.�Pacific Time) on the same day to discuss the results and business highlights.

Monday, November 18, 2013

Could Stocks Actually Climb With Bond Yields

The conventional wisdom holds that rising interest rates are sure to snuff out the 4½-year-old bull market in stocks. Action in the markets on August 15 buttresses the argument. Standard & Poor's 500-stock index tumbled 2.4% as the yield of the ten-year Treasury bond surged to as high as 2.82%, before finishing the day at 2.76%.

TOOL: Compare Online Brokers

But now comes a fascinating report from the Leuthold Group, a Minneapolis-based investment research firm, that argues against the market's recent action over the conventional wisdom. The report, written by Doug Ramsey, Leuthold's chief investment officer, notes that the ten-year Treasury actually hit its record-low yield of 1.39% on July 24, 2012. From that date through August 14, the S&P 500 rose 29%, even though the ten-year Treasury climbed by 1.31 percentage points.

What's more, the Leuthold study finds that stock prices and bond yields often rise in tandem, especially when yields start from a low base — which is precisely the case today. Since 1955, stock prices and bond yields have risen simultaneously about one-third of the time.

The more-recent numbers are just as surprising. From May 1 through August 14, the yield on ten-year Treasury bonds jumped from 1.63% to 2.70%. Over that same period, Standard & Poor's 500-stock index gained 7.2%.

Still, stock investors shouldn't get too complacent, because I think it's a near certainty that bond yields will continue to rise. Higher yields can hurt stocks because they make fixed-income investments relatively more attractive and because they have the potential to slow down economic activity — the housing sector being one notably vulnerable sector.

How rising yields affect share prices depends in large measure on where yields are starting from. The lower the absolute yield on the ten-year Treasury, the more likely stock prices will rise along with yields. Ramsey finds that stock prices often rise along with bond yields except when the ten-year Treasury yield is 6% or higher. A 6% Treasury tends to be bad news for stocks. That doesn't mean stocks always go up when yields rise but remain below 6%, but it means they often do. "Periods of jointly rising interest rates and stock prices have been much more common than widely recognized," Ramsey writes.

Why would bond yields and stock prices rise in tandem? "Rising rates occur as business prospects improve," says Ramsey. "Often the best time to buy stocks is when the economy is recovering from a recession and rates are rising."

The situation today differs from what's normally seen during the latter stages of a business expansion. At that point, prices are starting to rise, and the Federal Reserve Board, to quash inflation before it becomes too big a problem, starts to raise short-term interest rates. Both rising inflation and rising short-term rates can kill a bull market in stocks.

Rising yields on medium-maturity and long-term bonds also spell trouble. When the yield on ten-year Treasuries surpasses 6%, bonds provide major competition with stocks for investor dollars. The higher bond yields go, the more likely they are to drive stocks down.

But rising yields can be a plus for stocks. The current bull market, which began on March 10, 2009, started just ten days before the beginning of a 1.31- percentage-point spike in the ten-year Treasury's yield that took place over less than two weeks. Frightened investors used Treasuries as a refuge during those awful days, and rising yields and stock prices were both early signals that things were finally getting better.

That's hardly the only time rising rates have accompanied rising stock prices. Leuthold identifies 12 such instances, including the current one, since 1955, the period covered by the study. During these periods, the yield on the ten-year Treasury rose an average of 1.69 percentage points, and the S&P 500 gained an average of 35.3%.

What about today? It is different this time. The Federal Reserve has bought up trillions of dollars in Treasury securities with the professed goal of stimulating the economy. The incredibly low interest rates triggered by "quantitative easing" have encouraged hedge funds and other speculators to borrow huge amounts of money to invest in all kinds of risky assets, including U.S. stocks and emerging-markets stocks.

Now, of course, the Fed is talking about tapering back on and eventually ending quantitative easing. But even when quantitative easing ends, the Fed has pledged to keep short-term interest rates low for some time to come. Longer-term rates seem almost sure to rise, but if the Leuthold study is right, the bull market in stocks could continue.

Ramsey himself isn't so sure. He notes that the ten-year Treasury yield has risen a full percentage point from its low — not far below the average for periods when bond yields and stock prices have risen together. "The current episode of jointly rising yields and stock prices is fairly mature," he says. Maybe so. But bond yields still remain extremely low by historical standards, meaning stocks could well go higher.

Steven T. Goldberg is an investment adviser in the Washington, D.C. area.



Sunday, November 17, 2013

5 Stocks Set to Soar on Bullish Earnings

DELAFIELD, Wis. (Stockpickr) -- Short-sellers hate being caught short a stock that reports a blowout quarter. When this happens, we often see a tradable short squeeze develop as the bears rush to cover their positions to avoid big losses. Even the best short-sellers know that it's never a great idea to stay short once a bullish earnings report sparks a big short-covering rally.

>>5 Breakout Trades to Take Ahead of the Fed

This is why I scan the market for heavily shorted stocks that are about to report earnings. You only need to find a few of these stocks in a year to help enhance your portfolio returns -- the gains become so outsized in such a short time frame that your profits add up quickly.

That said, let's not forget that stocks are heavily shorted for a reason, so you have to use trading discipline and sound money management when playing earnings short-squeeze candidates. It's important that you don't go betting the farm on these plays and that you manage your risk accordingly. Sometimes the best play is to wait for the stock to break out following the report before you jump in to profit off a short squeeze. This way, you're letting the trend emerge after the market has digested all of the news. >>5 Rocket Stocks to Buy as Mr. Market Climbs Of course, sometimes the stock is going to be in such high demand that you risk missing a lot of the move by waiting. That's why it can be worth betting prior to the report -- but only if the stock is acting technically very bullish and you have a very strong conviction that it is going to rip higher. Just remember that even when you have that conviction and have done your due diligence, the stock can still get hammered if The Street doesn't like the numbers or guidance. If you do decide to bet ahead of a quarter, then you might want to use options to limit your capital exposure. Heavily shorted stocks are usually the names that make the biggest post-earnings moves and have the most volatility. I personally prefer to wait until all the earnings-related news is out for a heavily shorted stock and then jump in and trade the prevailing trend. >>5 Stocks Rising on Big Volume With that in mind, here's a look at several stocks that could experience big short squeezes when they report earnings this week.

Pier 1 Imports Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

My first earnings short-squeeze trade idea is Pier 1 Imports (PIR), a global importer of imported decorative home furnishings and gifts, which is set to release numbers on Thursday before the market opens. Wall Street analysts, on average, expect Pier 1 Imports to report revenue of $404.64 million on earnings of 21 cents per share.

5 Best Growth Stocks For 2014

Just recently, Argus said the recent pullback in shares of Pier 1 Imports is providing an attractive entry point, and the firm reiterated its buy rating on the stock with a $27 per share price target. The firm believes that Pier 1 Imports should hold up well in a promotional and competitive environment. >>5 Stocks Ready for Breakouts The current short interest as a percentage of the float Pier 1 Imports stands at 5%. That means that out of the 97.51 million shares in the tradable float, 4.90 million shares are sold short by the bears. If the bulls get the earnings news they're looking for, then shares of PIR could jump sharply higher post-earnings as the bears rush to cover some of their bets. From a technical perspective, PIR is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending for the last month, with shares moving higher from its low of $20.59 to its intraday high of $23.23 a share. During that uptrend, shares of PIR have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of PIR within range of triggering a near-term breakout trade post-earnings. If you're bullish on PIR, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some near-term overhead resistance levels at $23.50 to $24 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 1.25 million shares. If that breakout hits, then PIR will set up to re-test or possibly take out its 52-week high at $25.28 a share. Any high-volume move above $25.28 could push PIR towards $30 a share. I would simply avoid PIR or look for short-biased trades if after earnings it fails to trigger that breakout and then drops back below its 200-day at $22.44 a share with high volume. If we get that move, then PIR will set up to re-test or possibly take out its next major support levels at $21.64 to $20.59 a share.

ScholasticContent on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

Another potential earnings short-squeeze trade idea is children’'s publishing, education, and media company Scholastic (SCHL), which is set to release its numbers on Thursday before the market open. Wall Street analysts, on average, expect Scholastic to report revenue $299.70 million on a loss of 68 cents per share.

>>5 Hated Earnings Stocks You Should Love The current short interest as a percentage of the float for Scholastic is very high at 13.3%. That means that out of the 27.7 million shares in the tradable float, 3.41 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 12.9%, or by about 388,000 shares. If the bears get caught pressing their bets into a strong quarter, then shares of SCHL could rip sharply higher post-earnings as the bears rush to cover some of their short bets. From a technical perspective, SCHL is currently trending above its 200-day moving average and just below its 50-day moving average, which is neutral trendwise. This stock has been trending sideways for the last two months, with shares moving between $28.68 on the downside and $31.44 on the upside. Any high-volume move above the upper-end of its recent range could trigger a near-term breakout trade for shares of SCHL post-earnings. If you're in the bull camp on SCHL, then I would wait until after its report and look for long-biased trades if this manages to break out above its 50-day moving average at $30.43 a share and then once it takes out more resistance at $31.44 a share high volume. Look for volume on that move that hits near or above its three-month average action of 170,081 shares. If that breakout hits, then SCHL will set up to re-test or possibly take out its next major overhead resistance levels at $33 to its 52-week high at $34.55 a share. Any high-volume move above those levels will then give SCHL a chance to tag $40 a share. I would simply avoid SCHL or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below its 200-day at $29.15 a share and then once it takes out more key near-term support levels at $28.68 to $28.08 a share with high volume. If we get that move, then SCHL will set up to re-test or possibly take out its next major support levels at $27 to $26 a share.

Rite AidContent on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

One potential earnings short-squeeze candidate is retail drugstore chain operator Rite Aid (RAD), which is set to release numbers on Thursday before the market open. Wall Street analysts, on average, expect Rite Aid to report revenue of $6.27 billion on a loss of 4 cents per share.

>>5 Stocks With Big Insider Buying The current short interest as a percentage of the float for Rite Aid is notable at 3.7%. That means that out of the 896 million shares in the tradable float, 33.54 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 32%, or by about 8.13 million shares. If the bears get caught pressing their bets into a bullish quarter, then shares of RAD could easily explode higher post-earnings as the bears rush to cover some of their short bets. From a technical perspective, RAD is currently trending above its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong for the last six months, with shares moving higher from its low of $1.65 to its recent high of $3.75 a share. During that uptrend, shares of RAD have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of RAD within range of triggering a major breakout trade post-earnings. If you're bullish on RAD, then I would wait until after its report and look for long-biased trades if this stock manages to break out above its 52-week high at $3.75 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 20.36 million shares. If that breakout hits, then RAD will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $5 to $6 a share. I would avoid RAD or look for short-biased trades if after earnings it fails to trigger that breakout, and then drops back below some key near-term support levels at $3.53 a share to its 50-day moving average of $3.25 a share with high volume. If we get that move, then RAD will set up to re-test or possibly take out its next major support levels at $3.08 to $2.80 a share.

CintasContent on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

Another earnings short-squeeze prospect is business support services player Cintas (CTAS), which is set to release numbers on Thursday after the market close. Wall Street analysts, on average, expect Cintas to report revenue of $1.10 billion on earnings of 63 cents per share.

>>4 Stocks Within Range of Breakouts The current short interest as a percentage of the float for Cintas stands at 5.6%. That means that out of the 102.38 million shares in the tradable float, 5.70 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 2.5%, or by about 136,000 shares. If the bears get caught pressing their bets into a strong quarter, then shares of CTAS could move up sharply higher post-earnings as the bears move to cover some of those bets. From a technical perspective, CTAS is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong for the last six months, with shares moving higher from its low of $42.35 to its recent high of $50.80 a share. During that uptrend, shares of CTAS have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of CTAS within range of triggering a big breakout trade post-earnings. If you're bullish on CTAS, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some near-term overhead resistance levels at $61 to $62.27 a share and then once it takes its 52-week high at $50.80 a share with high volume. Look for volume on that move that hits near or above its three-month average action of 458,136 shares. If that breakout hits, then CTAS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $60 to $65 a share. I would simply avoid CTAS or look for short-biased trades if after earnings it fails to trigger that breakout and then drops back below some key near-term support at $49.50 a share with high volume. If we get that move, then CTAS will set up to re-test or possibly take out its 50-day at $48.32 share to more near-term support levels at $47.64 to $47 a share.

Darden Restaurants Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

My final earnings short-squeeze play is full-service restaurant operator Darden Restaurants (DRI), which is set to release numbers on Friday before the market open. Wall Street analysts, on average, expect Darden Restaurants to report revenue of $2.20 billion on earnings of 70 cents per share.

Just recently, Wunderlich issued a hold rating on shares of Darden Restaurants with a $50 per share price target. The firm said internal investments will take time to bear fruit. >>5 Stocks Under $10 Setting Up to Trade Higher The current short interest as a percentage of the float for Darden Restaurants is pretty high at 7.3%. That means that out of the 129.22 million shares in the tradable float, 9.47 million shares are sold short by the bears. The bears have also been increasing their bets from the last reporting period by 8.1%, or by about 705,000 shares. If the bears get caught pressing their bets into a bullish quarter, then shares of DRI could spike sharply higher post-earnings as the bears jump to cover some of those bets. From a technical perspective, DRI is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending for the last few weeks, with shares moving higher from its low of $45.71 a share to its intraday high of $49.50 a share. During that uptrend, shares of DRI have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of DRI within range of triggering a near-term breakout trade post-earnings. If you're in the bull camp on DRI, then I would wait until after its report and look for long-biased trades if this stock manages to break out above some near-term overhead resistance at $50.15 a share with high volume. Look for volume on that move that hits near or above its three-month average volume of 1.44 million shares. If that breakout hits, then DRI will set up to re-test or possibly take out its next major overhead resistance levels at $52.24 to $54.66 a share. Any high-volume move above those levels will then give DRI a chance to tag its 52-week high at $57.93 a share. I would avoid DRI or look for short-biased trades if after earnings it fails to trigger that breakout and then drops back below both its 50-day at $48.62 a share and its 200-day at $48.27 a share with high volume. If we get that move, then DRI will set up to re-test or possibly take out its next major support levels at $45.71 to $42.75 a share. To see more potential earnings short squeeze plays, check out the Earnings Short-Squeeze Plays portfolio on Stockpickr. -- Written by Roberto Pedone in Delafield, Wis. RELATED LINKS: >>5 Tech Stocks Spiking on Unusual Volume >>Why Wall Street Got Apple Wrong >>5 Rocket Stocks to Buy as the Market Climbs 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 CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

Friday, November 15, 2013

Forbes explores sale

steve forbes

Steve Forbes, who could be the last member of his family to own the business magazine started by his grandfather. The company is exploring a possible sale.

NEW YORK (CNNMoney) Forbes Media, the family-owned business magazine publisher, has hired Deutsche Bank to explore a possible sale of the company.

A letter sent to employees Friday by Forbes Media president and CEO Mike Perlis said the move is prompted by "more than a few over the transom indications of interest" to buy the company.

"The frequency and serious nature of these overtures have brought us to a decision point," he said in the letter.

Its flagship property, Forbes, with a circulation of 933,000, is the third largest U.S. business magazine, according to the Alliance for Audited Media. It lags Time Warner's Money magazine and Bloomberg Businessweek, owned by financial publisher Bloomberg. It has about 370 employees.

Print media has been a difficult business in recent years due to losses of both readers and advertisers to online media.

Forbes' ad revenue for the first 9 months of the year fell 7.5% to $165.7 million, according to the Association of Magazine Media, and the ad pages in the print edition have fallen 12.5%.

Perlis' letter said that digital revenue at the company is expected to increase this year. The company also owns a number of web sites beyond Forbes.com, including Investopedia.com, and the RealClear family of sites such as RealClearPolitics.

Best Financial Stocks To Watch For 2014

But if Forbes is sold, it would join a trend of print properties being sold.

In March Time Warner (TWX, Fortune 500), which is also owner of CNNMoney, announced its plans to spin off its Time Inc. publishing unit! , the nation's largest magazine publisher, in a deal set to close early next year. That unit includes both Money and Fortune magazines.

Newsweek, the news magazine whose print version was abandoned late last year, was sold in August by IAC (IACI) to another all-digital news company, IBT Media.

Major newspapers have also been put on the block and sold this year. Amazon (AMZN, Fortune 500) founder Jeff Bezos is buying the Washington Post for $250 million in a deal announced in August, and the New York Times Co. (NYT) announced it would sell the Boston Globe for only $70 million to Boston Red Sox owner John Henry, despite having paid $1.1 billion for the paper in 1991.

In June, the former News Corp. took the name 21st Century Fox (FOX) and spun off its print publications such as the Wall Street Journal, the New York Post and several London newspapers into a new News Corp. (NWS)

Forbes was started by B.C. Forbes in 1917. His son, Malcolm, succeeded him as publisher. He handed it down to his son, Steve, who is still chairman and editor in chief. But two years ago, Perlis was brought in as the first non-family member to serve as CEO of the company.

The Forbes family also sold a minority stake in the company to investment firm Elevation Partners -- which includes rock singer Bono among its partners -- in August 2006. Elevation did not return a call seeking a comment on the sales plans. To top of page

Thursday, November 14, 2013

Hot Oil Stocks To Buy For 2014

With shares of Chevron (NYSE:CVX) trading around $120, is CVX an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let�� analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Chevron�engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. The company operates in two segments, Upstream and Downstream.�The Upstream segment is involved in the exploration, development, and production of crude oil and natural gas while the Downstream segment�engages in refining crude oil into petroleum products. Through its segments, Chevron is able to provide a range of energy products and services to a multitude of companies around the world. As economies and businesses expand, Chevron provides the energy needed to fuel production around the world.

T = Technicals on the Stock Chart are Strong

Chevron stock has doubled since hitting lows during the 2008 Financial Crisis. The stock has gone on to trade much higher and is now trading at all-time high prices. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Chevron is trading above its rising key averages which signal neutral to bullish price action in the near-term.

Hot Oil Stocks To Buy For 2014: Cameron International Corp (CAM)

Cameron International Corporation (Cameron), incorporated on November 10, 1994, provides flow equipment products, systems and services to worldwide oil, gas and process industries. Cameron operates in three business segments: Drilling and Production Systems (DPS), Valves & Measurement (V&M) and Process & Compression Systems (PCS). The DPS segment includes businesses, which provides systems and equipment used to control pressures and direct flows of oil and gas wells. The V&M segment includes businesses, which provides valves and measurement systems used to control, direct and measure the flow of oil and gas as they are moved from individual wellheads through flow lines, gathering lines and transmission systems to refineries, petrochemical plants and industrial centers for processing. The PCS segment includes businesses, which provides standard and custom-engineered process packages for separation and treatment of impurities within oil and gas and compression equipment and aftermarket parts and services to the oil, gas and process industries. During the year ended December 31, 2011, it acquired LeTourneau Technologies, Inc. (LeTourneau) from Joy Global Inc. During 2011, it acquired Vescon Equipamentos Industrias Ltda. During 2011, it acquired 51% interest in Newmans Valves. In September 2012, TTS Group ASA sold its drilling equipment business to the Company. Effective August 5, 2013, Cameron International Corp acquired a 75% interest in Douglas Chero SpA, from Consilium SGR SpA.

Drilling & Production Systems Segment

Cameron�� products are employed in a range of operating environments, including basic onshore fields, complex onshore and offshore environments, deepwater subsea applications and ultra-high temperature geothermal operations. The products within this segment include surface and subsea production systems, blowout preventers (BOPs), drilling and production control systems, block valves, gate valves, actuators, chokes, wellheads, manifolds, drilling risers, top drive! s, mud pumps, other rig products and aftermarket parts and services. In addition, the DPS segment designs and manufactures structural components for land and offshore drilling rigs. The segment�� businesses also manufacture elastomers, which are used in pressure and flow control equipment and other petroleum industry applications, as well as in the petroleum, petrochemical, rubber molding and plastics industries. The businesses within this segment market their products directly to end-users through a worldwide network of sales and marketing employees, supported by agents in some international locations. Customers include oil and gas majors, national oil companies, independent producers, engineering and construction companies, drilling contractors, rental companies and geothermal energy producers. The businesses included in this segment are Drilling Systems, Surface Systems, Subsea Systems and Flow Control.

Drilling Systems is a global supplier of integrated drilling systems for onshore and offshore applications. Drilling equipment designed and manufactured includes ram and annular BOPs, control systems, drilling risers, drilling valves, choke and kill manifolds, diverter systems, top drives, draw works, mud pumps, other rig products and aftermarket parts and services. The products are marketed under the Cameron, Guiberson, H&H CUSTOM, H&H, Melco, LeTourneau, Lewco, OEM and Townsend brand names. Surface Systems is a global market in supplying surface production equipment, from conventional to high-pressure, high temperature (HPHT) wellheads, production systems and controls, block valves, gate valves, mudline systems, dry completion systems and aftermarket parts and services. The products are marketed under the Cameron, Camrod, IC, McEvoy, Precision, SBS, Tundra, Willis and WKM brand names. Cameron, which has a global base of installed equipment and an aftermarket presence in hydrocarbon-producing region worldwide, is the provider of surface production equipment. Surface Systems added new s! ales and ! aftermarket facilities in the Marcellus, Eagle Ford and Haynesville shale regions.

Subsea Systems is a provider of subsea wellheads, production systems and controls, manifolds and aftermarket parts and services to customers worldwide, from basic subsea tree orders to integrated solutions, as well as installation and aftermarket support. These products are marketed under the Cameron, Mars, McEvoy and Willis brand names. Flow Control provides chokes, actuators, gears, valve accessories and automation solutions to other Cameron businesses, as well as to other industry manufacturers and directly to end users under such brand names as Cameron, Dynatorque, Ledeen, Maxtorque, Test and Willis. Flow Control has expanded its subsea chemical injection metering valve (CIMV) product line, introducing a high-flow CIMV.

Valves & Measurement Segment

Cameron�� products include gate valves, ball valves, butterfly valves, Orbit valves, double block & bleed valves, plug valves, globe valves, check valves, actuators, chokes and aftermarket parts and services, as well as measurement products such as totalizers, turbine meters, flow computers, chart recorders, ultrasonic flow meters and sampling systems. This equipment and the related services are marketed through a worldwide network of combined sales and marketing employees, as well as distributors and agents in selected international locations. Customers include oil and gas majors, independent producers, engineering and construction companies, pipeline operators, drilling contractors and major chemical, petrochemical and refining companies. The businesses included in this segment are Distributed Valves, Engineered Valves, Process Valves, Measurement Systems and Aftermarket Services.

Distributed Valves provides a range of valves used in the exploration, production and transportation of oil and gas, with products sold through a network of wholesalers and distributors, primarily in North America and to upstream markets in A! sia-Pacif! ic and the Middle East. These valves are marketed under the brand names Cooper, Demco, Navco, Newco, Nutron, OIC, Techno, Texstream, Thornhill Craver, Wheatley and WKM. Engineered Valves provides a range of customized ball, gate and check valves serving the oil and gas production, pipeline, subsea and liquefied natural gas (LNG) markets. Products are marketed under the brand names Cameron, Entech, Grove, Ring-O, TK and Tom Wheatley.

Process Valves provides valves under the brand names of General Valve, Orbit, TBV and WKM for use in critical service applications that are often subject to extreme temperature conditions, particularly in refinery, power generation, including nuclear, chemical, petrochemical, gas processing and liquid storage terminal markets, including liquefied natural gas (LNG). Measurement Systems designs, manufactures and distributes measurement products, systems and solutions to the global oil and gas, process and power industries. The Company�� main product brand names include Barton, Caldon, Clif Mock, Jiskoot, Linco, Nuflo and PAAI. Aftermarket Services provides preventative maintenance, original equipment manufacturer (OEM) spare parts, repair, field service, asset management and remanufactured products for valves and actuators.

Process & Compression Systems Segment

Integrally geared centrifugal compressors are used by customers worldwide in a range of industries, including air separation, petrochemical, chemical and process gas. Products include oil and gas separation equipment, heaters, dehydration and desalting units, gas conditioning units, membrane separation systems, water processing systems, integral engine-compressors, separable reciprocating compressors, two and four-stroke cycle gas engines, turbochargers, integrally-geared centrifugal compressors, compressor systems and controls. Aftermarket services include spare parts, technical services, repairs, overhauls and upgrades. The businesses included in this segment are Process System! s, Recipr! ocating Compression and Centrifugal Compression.

The process systems businesses provide custom-engineered process packages to oil and gas majors, national oil companies, independent operators and engineering, procurement and construction companies worldwide for separation and treatment of oil, gas, water and solids. Products offered include separators, heaters, dehydration and desalting units, gas conditioning units, membrane separation systems, water processing systems and aftermarket parts and services. PCS markets its process systems products under the Cameron, Consept, Cynara, Hydromation, KCC, Metrol, Mozley, NATCO, Petreco, Porta-test, Unicel, Vortoil and Wemco brand names.

Reciprocating Compression equipment is used throughout the energy industry by gas transmission companies, compression leasing companies, oil and gas producers and independent power producers. Reciprocating Compression products and services are marketed under the Ajax, Cooper-Bessemer, CSI, Enterprise, Superior, Texcentric and TSI brand names. Ajax integral engine-compressors, which combine the engine and compressor on a single drive shaft, are used for gas re-injection and storage, as well as on smaller gathering and transmission lines. Superior-brand separable compressors are used for natural gas applications, including production, storage, withdrawal, processing and transmission, as well as petrochemical processing. These high-speed separable compressor units can be matched with either natural gas engine drivers or electric motors. Reciprocating Compression also provides global support for its products and maintains sales and service offices in key international locations. During 2011, approximately 60% of the Reciprocating Compression revenues were generated by sales of aftermarket parts and services in support of the Company�� worldwide installed base of compression equipment. Customers for Reciprocating Compression products include oil and gas majors, national oil companies, petrochemical and re! fining co! mpanies, midstream natural gas companies, independent power producers and compressed natural gas distribution companies.

Centrifugal Compression manufactures and supplies integrally geared centrifugal compressors and provides aftermarket services to customers worldwide. Centrifugal air compressors, used in manufacturing processes (plant air), are sold under the Turbo-Air. Engineered compressors are used in the process air and gas industries and are identified by the MSG. The process and plant air centrifugal compressors deliver oil-free compressed air and other gases to customers, thus preventing oil contamination of the finished products. Centrifugal Compression also provides installation and maintenance services, parts, repairs, overhauls and upgrades to its worldwide customers for plant air and process gas compressors. It also provides aftermarket service and repairs on all equipment it produces through a worldwide network of distributors, service centers and field service technicians utilizing an extensive inventory of parts marketed under the Joy brand name. Centrifugal Compression customers include oil and gas majors, national oil companies, air separation companies, independent power producers, petrochemical and refining companies, midstream natural gas companies and durable goods manufacturers.

The Company competes with Aker Solutions, Balon Corporation, Circor International, Inc., Dover Corporation, Dril-Quip, Inc., Emerson Process Management, FlowServ Corp., FMC Technologies, Inc., GE Oil & Gas Group, Stream-Flo Industries Ltd., National Oilwell Varco Inc., Zy-Tech Global Industries company, Flotek Industries, Inc., Pibiviese, Robbins & Myers Fluid Management Group, SPX Corporation�� Flow Technology Segment, Tyco International Ltd., Weatherford, Ltd., Ariel Corporation, Compressor Engineering Corporation, Demag, Dresser-Rand Company, FS-Elliott Company LLC, Endyn Energy Dynamics, Hoerbiger Group and IR Air Solutions.

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.

  • [By Dan Caplinger]

    Another issue that Varco has to face is the specter of increasing competition. Cameron International (NYSE: CAM  ) has arisen as a big player in the drilling and production systems space, with a particular emphasis on subsea applications like blowout preventers. With Cameron sporting a recent partnership with Schlumberger (NYSE: SLB  ) , the combination will have both the expertise and the financial resources to challenge Varco in that niche. More broadly, up-and-coming Forum Energy (NYSE: FET  ) has sought to emulate Varco's broad-based services menu, offering remotely operated vehicles for deepwater inspection and construction as well as pipe and cementing materials and a range of subsea systems and equipment. Forum has posted solid results in its brief history, taking steps to continue its fast growth trajectory.

Hot Oil Stocks To Buy For 2014: Royal Caribbean Cruises Ltd.(RCL)

Royal Caribbean Cruises Ltd. operates in the cruise vacation industry worldwide. It owns five cruise brands, which comprise Royal Caribbean International, Celebrity Cruises, Pullmantur, Azamara Club Cruises, and CDF Croisi�es de France. The Royal Caribbean International brand provides various itineraries and cruise lengths with options for onboard dining, entertainment, and other onboard activities primarily for the contemporary segment. It offers surf simulators, water parks, ice skating rinks, rock climbing walls, and shore excursions at each port of call, as well as boulevards with shopping, dining, and entertainment venues. The Celebrity Cruises brand operates onboard upscale ships that offer luxurious accommodations, fine dining, personalized services, spa facilities, venue featuring live grass, and glass blowing studio for the premium segment, as well as resells computers and other media devices. The Pullmantur brand provides an array of onboard activities and serv ices to guests, including exercise facilities, swimming pools, beauty salons, gaming facilities, shopping, dining, complimentary beverages, and entertainment venues serving the contemporary segment of the Spanish, Portuguese, and Latin American cruise markets. The Azamara Club Cruises brand offers various onboard services, amenities, gaming facilities, fine dining, spa and wellness, butler service for suites, and interactive entertainment venues for the up-market segment of the North American, United Kingdom, German, and Australian markets. The CDF Croisieres de France brand offers seasonal itineraries to the Mediterranean; and various onboard services, amenities, entertainment venues, exercise and spa facilities, fine dining, and gaming facilities for the contemporary segment of the French cruise market. As of December 31, 2011, the company operated 39 ships with a total capacity of approximately 92,650 berths. Royal Caribbean Cruises Ltd. was founded in 1968 and is headqua rtered in Miami, Florida.

Advisors' Opinion:
  • [By Rick Munarriz]

    The fire aboard Royal Caribbean's (NYSE: RCL  ) Grandeur of the Seas was put out within two hours, but not before disrupting the travel plans of passengers on board and those set to board the ship this Friday. Both sailings have been nixed, and even though Royal Caribbean is doing things right by issuing refunds and discounts on future sailings, this is going to be a big hit for the cruise industry.

  • [By Rick Munarriz]

    Ever since Royal Caribbean (NYSE: RCL  ) introduced outdoor rock walls for daring climbers, cruise lines have tried to raise the stakes in attracting young passengers who can't be wooed by mere spa treatments or midnight buffets. Carnival (NYSE: CCL  ) , Royal Caribbean, and the recently public Norwegian Cruise Lines (NASDAQ: NCLH  ) have added zip lines, indoor bowling alleys, and even bumper cars to make sea life more appealing to young families with toddlers and young adults.

Best Heal Care Companies For 2014: Weatherford International Ltd(WFT)

Weatherford International Ltd. provides equipment and services used in the drilling, evaluation, completion, production, and intervention of oil and natural gas wells worldwide. It offers artificial lift systems, which include reciprocating rod lift systems, progressing cavity pumps, gas lift systems, hydraulic lift systems, plunger lift systems, hybrid lift systems, wellhead systems, and multiphase metering systems. The company also provides drilling services, including directional drilling, ?Secure Drilling? services, well testing, drilling-with-casing and drilling-with-liner systems, and surface logging systems; and well construction services, such as tubular running services, cementing products, liner systems, swellable products, solid tubular expandable technologies, and inflatable products and accessories. In addition, it designs and manufactures drilling jars, underreamers, rotating control devices, and other pressure-control equipment used in drilling oil and nat ural gas wells; and offers a selection of in-house or third-party manufactured equipment for the drilling, completion, and work over of oil and natural gas wells for operators and drilling contractors, as well as a line of completion tools and sand screens. Further, the company provides wireline and evaluation services; and re-entry, fishing, and thru-tubing services, as well as well abandonment and wellbore cleaning services; stimulation and chemicals, including fracturing and coiled tubing technologies, cement services, chemical systems, and drilling fluids; integrated drilling services; and pipeline and specialty services. It serves independent oil and natural gas producing companies. The company was founded in 1972 and is headquartered in Geneva, Switzerland.

Advisors' Opinion:
  • [By Dr. Kent Moors]

    That's why some of the biggest OFS providers - like Schlumberger (NYSE: SLB), Halliburton (NYSE: HAL) and Weatherford International (NYSE: WFT) - have been buying up oil and gas equipment companies.

  • [By Rich Bieglmeier]

    And that belongs to William Macaulay who is a director at Weatherford International, Ltd. (WFT). The director bought 78,000 shares of WFT on September 27, 2013 for a total of $1.19 million. Mr. Macaulay's recent purchase is particularly peculiar.

  • [By Ben Levisohn]

    Weatherford International (WFT) has dropped 6.3% to $14.75 before the open of trading after it announced the departure of its CFO in an 8-K filing. Wells Fargo and Raymond James both cut Weatherford’s shares as a result of the change.

  • [By Taylor Muckerman]

    Improperly hunting for tax havens
    While in the midst of reconciling tax-accounting issues, Weatherford International� (NYSE: WFT  ) came under SEC investigation for potentially selling goods to sanctioned Iran and Syria back in March 2012. The stock has yet to recover and has traded down 20.6% since March 16, 2012, while the S&P 500 is up 15% and rival Halliburton is up 23.9% over the same time frame.

Hot Oil Stocks To Buy For 2014: Marathon Oil Corporation(MRO)

Marathon Oil Corporation, through its subsidiaries, operates as an international energy company with operations in the United States, Canada, Africa, the Middle East, and Europe. It operates through three segments: Exploration and Production, Oil Sands Mining, and Integrated Gas. The Exploration and Production segment explores for, produces, and markets liquid hydrocarbons and natural gas. The Oil Sands Mining segment mines, extracts, and transports bitumen from oil sands deposits in Alberta, Canada; and upgrades the bitumen to produce and market synthetic crude oil and vacuum gas oil. The Integrated Gas segment markets and transports products manufactured from natural gas, such as liquified natural gas and methanol. The company was formerly known as USX Corporation and changed its name to Marathon Oil Corporation in July 2001. Marathon Oil Corporation was founded in 1887 and is based in Houston, Texas.

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

    Marathon Oil Corp. (NYSE: MRO) was raised to Buy from Hold with a $42 price target (versus a $34.90 close) at Argus.

    Marketo Inc. (NASDAQ: MKTO) was reinstated as Outperform with a $38 price target (versus a $31.49 close) at Credit Suisse.

Hot Oil Stocks To Buy For 2014: Gastar Exploration Ltd (GST)

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

    Earlier, the company had pocketed $75.2 million by selling to Gastar Exploration (NYSEMKT: GST  ) leasehold acreage in Oklahoma's Kingfisher and Canadian counties. It'll obviously require a passel of sales of that magnitude to shore up an overweight balance sheet.

  • [By Josh Young]

    The parallel to Goodrich in the transaction is Gastar Exploration (GST), which has approximately 100,000 net acres in the Hunton (excluding additional exposure from the WEHLU deal). Gastar, similar to Goodrich prior to the Sanchez TMS deal, seems to trade at a discount to a $2,000 per acre implied value for its unconventional oil acreage. In fact, Gastar's CEO recently said he thought the current liquidation value of Gastar's Marcellus assets would be $4-7 per share, net of debt, versus the current $4.25 share price.

  • [By Heather Ingrassia]

    Gastar Agreement: On April 1st it was announced that Gastar Exploration, Ltd. (GST) had entered into a definitive agreement to acquire proven reserves and undeveloped leasehold interests in Kingfisher and Canadian counties of Oklahoma from Chesapeake Energy Corporation, repurchase Chesapeake's common shares of the Company and settle all litigation for $1 million. Although smaller in scope than most of Chesapeake's previous asset-shedding transactions, the agreement with Gastar accomplishes two things. First, is the fact the settlement resolves the legal wrangling both companies were engaged in and as a result Chesapeake walks away with $85 million of the potential $130 million they were suing for. Second, is the fact Chesapeake wipes it hands of acreage, that although producing, may not be producing as much as Chesapeake had once hoped, and therefore was worth much more to Gastar in the long run.

Hot Oil Stocks To Buy For 2014: Williams Partners L.P.(WPZ)

Williams Partners L.P. focuses on natural gas transportation, gathering, treating and processing, storage, natural gas liquid fractionation, and oil transportation activities in the United States. The company operates in two segments, Gas Pipeline, and Midstream Gas and Liquids. The Gas Pipeline segment owns and operates approximately 13,900 miles of pipelines with annual throughput of approximately 2,700 trillion British thermal units of natural gas and delivery capacity of approximately 13 million dekatherms of gas. This segment also owns interests in joint venture interstate and intrastate natural gas pipeline systems. The Midstream Gas and Liquids segment includes natural gas gathering, processing, and treating facilities; and crude oil gathering and transportation facilities that serve the producing basins in Colorado, New Mexico, Wyoming, the Gulf of Mexico, and Pennsylvania. Williams Partners GP LLC serves as the general partner of the company. Williams Partners L.P . was founded in 2005 and is based in Tulsa, Oklahoma.

Advisors' Opinion:
  • [By The Part-time Investor]

    Williams Partners (WPZ), 38 shares at $52.73.

    Finally, I had to make some adjustments to my portfolio due to an unexpected tax issue. Through the comments section in response to an article I wrote about some MLPs that passed my criteria, I learned that there are extra tax implications to holding MLPs in a tax deferred retirement portfolio. With this new knowledge I decided to change some of my holdings:

  • [By Rich Duprey]

    Natural gas transportation and storage MLP�Williams Partners (NYSE: WPZ  ) announced yesterday its third-quarter dividend of $0.8625 per unit, a 9% increase from the payout it made to investors last quarter of $0.8475 per unit.

  • [By Stone Fox Capital]

    Williams has one of the leading energy infrastructures in North America. It owns interests in, or operates, 15,000 miles of interstate gas pipelines, 1,000 miles of NGL transportation pipelines, and more than 10,000 miles of oil and gas gathering pipelines. It owns more than 70% of Williams Partners L.P. (WPZ), one of the largest diversified energy master limited partnerships.

Wednesday, November 13, 2013

Ford's Tiny New Car Could Be a Big Seller

Ford unveiled the Ka Concept in Brazil on Wednesday. The company is expected to begin producing it in 2014. Photo credit: Ford Motor Co.

It looks like a Fusion that shrunk in the wash, doesn't it? It's actually a preview of a new Ford (NYSE: F  ) that could turn out to be a big deal in some far-flung markets.

The Ka Concept, as it's called, is Ford's latest "concept" car. It was revealed on Wednesday at an event in Brazil by the highest-ranking Ford official of them all, Executive Chairman Bill Ford.

Sometimes, when an automaker shows a concept car, it's just an idea, something meant to showcase a new technology, or a new design direction for a brand. That's the traditional idea behind the term. But I put the word "concept" in quotes above because often, a Ford "concept" is a thinly veiled (or not-at-all-veiled) preview of something they plan to produce. 

Ford dropped plenty of hints that its new Ka Concept falls into that latter category. It's clearly a preview of the 2015 Ford Ka. That makes it important. Here's why.

Despite its name, it originated fah from Bahston
The "Ka" -- it's pronounced like "cah," more or less -- is a tiny car that has been part of Ford's global lineup since 1996. Until now, it has always been a "three-door" -- two side doors and a hatchback -- marketed as an inexpensive, low-cost city car. 

An updated version of that original 1996 model is still made in Brazil and sold throughout Latin America. There's also a somewhat newer version, made in a Fiat factory in Poland, and sold in Europe. But neither is a modern, global Ford product.

This car appears to change that. Like its namesake predecessors, the Ka Concept is pretty small, one size down from a Fiesta. But it's very much a modern Ford, albeit a low-cost one.

The Ka Concept is quite small, but designed to maximize interior space. Photo credit: Ford Motor Co.

This Ka has five doors (counting the hatchback), and Ford says that it will comfortably seat five. And it has some amenities that urban folks in places like Brazil and India will appreciate: Ford bragged about its "best-in-class" air conditioning, and it's available with Ford's voice-activated SYNC infotainment system and a central docking station for smartphones and other mobile devices. 

Ford didn't say what kind of engine would power the Ka Concept. But it's clear from what Ford did say that the Ka Concept follows the winning approach that Ford has taken with global models up and down its product line: offer premium features in a well-thought-out package. 

We can safely assume that it will follow the rest of that approach when it comes to market: Ask a premium price, and ensure a good profit for Ford.

You might never see one in the U.S., but it should be a big seller
The Ka was developed by a Ford team in Brazil. It's their second all-new global Ford model. The first, the small EcoSport SUV, will eventually be rolled out to 62 countries, Ford says. It's already on sale in China and India (where it has been a surprise hit), and was recently launched in Russia and Western Europe.

The Ka Concept was developed by the same team that created the Ford EcoSport, which has been a hit in several major overseas markets. It's shown here in Moscow, where it recently went on sale. Photo credit: Ford Motor Co. 

It's not yet official, but Ford dropped some big hints on Wednesday that something very close to the Ka Concept will go into production in 2014. Cars in the global "sub-B" segment -- one size down from what we call a subcompact, like the Fiesta -- are expected to be big sellers in Latin America and South Asia in coming years, Ford says. It may never make it to the U.S., but I expect the production version of the Ka to follow the EcoSport's path to major markets around the world.

That won't hurt Ford's bottom line at all. The Ka Concept is clearly aiming to be a premium offering in that low-cost segment, just as the Fiesta and Focus are in the next two segments up the size ladder. 

Given how well it builds on Ford's well-proven product formula, it looks like Ford could have another global hit on its hands.

You can still profit from China's massive auto boom
U.S. automakers boomed after WWII, but the coming boom in the Chinese auto market will put that surge to shame! As Chinese consumers grow richer, savvy investors can take advantage of this once-in-a-lifetime opportunity with the help from this brand-new Motley Fool report that identifies two automakers to buy for a surging Chinese market. It's completely free -- just click here to gain access.