Which Way Does Panera Go From Here?

With shares of Panera Bread Co. (NASDAQ:PNRA) trading at around $183.74, is PNRA an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock's Movement

While most companies throughout the broader market are finding ways to cut costs, Panera plans on adding locations. This is a good sign as it indicates the company is confident in its future prospects. As most special eatery diners already know, Panera is known for its freshness, local ingredients, and atmosphere (WiFi included).

If you have ever walked into a Panera during lunchtime, then you know it's very crowded. And the afternoons attract people who want to work while enjoying a snack and/or beverage. The slowest time of day is dinner, which is why Panera is attempting to offer more at this time. Panera is especially trying to make a move with pasta. While there is potential, ordering pasta at Panera is akin to ordering a filet mignon at a diner. In other words, it's probably not a good idea. There's also a good chance that most diners have better local options for pasta than Panera. That said, don't knock it until you try it, right?

NEW! Discover a new stock idea each week for less than the cost of 1 trade. CLICK HERE for your Weekly Stock Cheat Sheets NOW!

Okay, enough about pasta. Pass or fail, pasta isn't going to be a determining factor for Panera. Looking at the big picture, Panera has grown revenue and earnings on an annual basis, and it still has a ton of growth potential domestically and internationally. Other positives include margin expansion and quality debt management. However, perhaps the most important factor of all is that Panera is now an established household brand name in the United States. As far as analysts go, they love the stock: 17 Buy, 8 Hold, 1 Sell.

There are a few negatives for Panera, which include missed earnings expectations, slightly slowing comps growth, and a lowered full-year comps growth expectation to 4.0%-5.0% from 4.5%-5.5%. There is also no yield.

Now let's take a look at some numbers. The chart below compares fundamentals for Panera, Starbucks Corporation (NASDAQ:SBUX), and Chipotle Mexican Grill (NYSE:CMG). Panera has a market cap of $5.34 billion, Starbucks has a market cap of $46.41 billion, and Chipotle has a market cap of $11.19 billion.

	Hot Energy Stocks For 2014 PNRA	SBUX	CMG
Trailing   P/E	29.86	31.50	39.22
Forward   P/E	22.49	23.66	28.45
Profit   Margin	8.22%	10.80%	10.36%
ROE	23.18%	28.97%	23.75%
Operating   Cash Flow	$298.51 Million	$2.55 Billion	$515.84   Million
Dividend   Yield	N/A	1.40%	N/A
Short   Position	4.90%	1.40%	16.30%

 

Let's take a look at some more important numbers prior to forming an opinion on this stock.

E = Equity to Debt Ratio Is Strong   

The debt-to-equity ratio for Panera is stronger than the industry average of 0.90.

	Debt-To-Equity	Cash	Long-Term Debt
PNRA	0.00	$323.00 Million	$0
SBUX	0.10	$1.70 Billion	$549.60 Million
CMG	0.00	$507.50 Million	$0

 

NEW! Discover a new stock idea each week for less than the cost of 1 trade. CLICK HERE for your Weekly Stock Cheat Sheets NOW!

T = Technicals Are Strong   

Panera has performed exceptionally well over a three-year time frame. It's also one of the few stocks that held its own during the financial crisis. This doesn't mean it would hold up just as well if a similar situation were to present itself, but it's worth noting.

	1 Month	Year-To-Date	1 Year	3 Year
PNRA	3.70%	15.70%	16.84%	145.00%
SBUX	7.60%	16.40%	13.61%	153.50%
CMG	9.90%	21.18%	-11.62%	174.10%

 

At $183.74, Panera is trading above all its averages.

50-Day   SMA	171.26
100-Day   SMA	166.22
200-Day   SMA	163.96

 

E = Earnings Have Been Strong            

Earnings and revenue have consistently improved on an annual basis. Earnings have increased for 10 consecutive years.

	2008	2009	2010	2011	2012
Revenue   ($)in   billions	1.30	1.35	1.54	1.82	2.13
Diluted   EPS ($)	2.22	2.78	3.62	4.55	5.89

 

When we look at the last quarter on a year-over-year basis, we see an increase in revenue and earnings.

	3/2012	6/2012	9/2012	12/2012	3/2013
Revenue   ($)in   millions	498.58	530.59	529.34	571.55	561.78
Diluted   EPS ($)	1.40	1.50	1.24	1.75	1.64

 

Now let's take a look at the next page for the Trends and Conclusion. Is this stock an OUTPERFORM, a WAIT AND SEE, or a STAY AWAY?

T = Trends Might Support the Industry

Panera is known as a healthier option than McDonald's Corp (NYSE:MCD) and Yum! Brands (NYSE:YUM) restaurants. With the consumer more health-conscious than in past years, this has helped Panera as well as other healthy eating establishments. McDonald's has been offering more healthy options, which has helped it as well.

The problem for Panera is price. If the consumer weakens, which seems to be likely, then many consumers might choose cheaper alternatives. On the other hand, Panera offers atmosphere, and many consumers are willing to pay a little extra for atmosphere.

NEW! Discover a new stock idea each week for less than the cost of 1 trade. CLICK HERE for your Weekly Stock Cheat Sheets NOW!

Conclusion

Now that Panera has become a mainstream American brand with millions of loyal customers that enjoy one of the most casual and comfortable atmospheres available,  it's a long-term OUTPERFORM. However, a tentative consumer, a somewhat poor valuation, and an artificially-inflated stock market are reasons for caution.

Home Prices Up 0.9% for August

Home prices headed higher for August, according to an S&P/Case-Shiller Home Price Index report (link opens as PDF) released today.

After bumping up 0.6% for July, the index's seasonally adjusted 20-city home price composite increased 0.9% for August. Following an expectations miss for July, analysts were pleasantly surprised by this month's report, having predicted slightly smaller 0.7% growth. 

According to the report, 14 of the 20 cities and both the 10- and 20-city composites registered increases in annual growth rates from July's numbers. Las Vegas prices increased the most, up 2.9% to their highest level since 2004 .

"Both composites showed their highest annual increases since February 2006," noted David Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, in a statement today. "All 20 cities reported positive year-over-year returns. Thirteen cities posted double-digit annual gains."

Top Clean Energy Stocks To Watch For 2014

But not all of Blitzer's news is good. Detroit home prices remain below 2000 levels, and fewer mortgage applications at higher rates could have contributed to the fact that 16 of the cities recorded smaller absolute price gains for August compared to July.

For the 12 months ending in September, both the 10- and 20-city composites showed average home prices increasing 12.8%. 

link

Has Cavco Industries Made You Any Real Money?

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

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

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

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

Over the past 12 months, Cavco Industries generated $20.0 million cash while it booked net income of $5.0 million. That means it turned 4.4% of its revenue into FCF. That sounds OK.

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

10 Best Insurance Stocks To Buy For 2014

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

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

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

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

With questionable cash flows amounting to only 1.5% of operating cash flow, Cavco Industries's cash flows look clean. Within the questionable cash flow figure plotted in the TTM period above, other operating activities (which can include deferred income taxes, pension charges, and other one-off items) provided the biggest boost, at 33.0% of cash flow from operations. Overall, the biggest drag on FCF also came from adjustments for gains owed to asset sales, which represented 39.1% of cash from operations.

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

Looking for alternatives to Cavco Industries? It takes more than great companies to build a fortune for the future. Learn the basic financial habits of millionaires next door and get focused stock ideas in our free report, "3 Stocks That Will Help You Retire Rich." Click here for instant access to this free report.

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

Add Cavco Industries to My Watchlist.

Long-lasting factory goods orders rise 3.7%

WASHINGTON — A jump in demand for commercial airplanes boosted orders for long-lasting U.S. factory goods last month. But orders for most other goods fell as businesses cut spending, a possible sign of concern about the partial government shutdown that began Oct. 1.

The Commerce Department said Friday orders for durable goods rose 3.7% in September, above the 0.2% gain in August. But a 57.5% jump in aircraft orders accounted for nearly all the gain. Durable goods are meant to last at least three years.

FRIDAY STOCKS: How markets are doing

Orders for core capital goods, which include industrial machinery and electrical equipment, fell 1.1%. August's 1.5% gain was revised sharply lower to 0.4 percent. Economists pay particular attention to core capital goods, which exclude aircraft and defense-related goods, because they are a sign of business confidence.

The figures echo other economic data that suggest companies were reluctant to expand or invest in new equipment in September, as budget battles in Washington intensified. Hiring also slowed last month. Employers added just 148,000 jobs, down from 193,000 in August.

Paul Ashworth, an economist at Capital Economics, said the drop in core capital goods orders points to weaker growth in the October-December quarter. Shipments of core capital goods, which are used to calculate economic growth, also dipped last month, a sign that growth in the July-September quarter will also be weak. Ashworth cut his growth estimate for the third quarter to an annual rate of 1.8 percent from 2 percent.

Commercial aircraft is a volatile category that can swing widely from month to month. Boeing says it received orders for 127 planes in September, up from just 16 in August.

In September, demand fell for machinery, fabricated metals, electrical equipment and autos. Orders rose for computers and communications equipment and defense-related goods.

Excluding aircraft, autos and other transportation goods, orders fell for the third s! traight month.

The report contrasts with other recent data that pointed to a healthier factory sector.

The Institute for Supply Management, a trade group, said factory activity expanded in September at the fastest pace in 2 ½ years. Production rose and manufacturers stepped up hiring, while new orders jumped, though not as quickly as the previous month.

And the Federal Reserve Bank of Philadelphia said last week that an index of regional manufacturing activity declined only slightly this month. Factories in the Philadelphia region received more orders, the Philly Fed said.

X

Spain joins bumpy European recovery

LONDON (CNNMoney) Spain's economy is beginning to emerge from years of gloom even as eurozone data show how bumpy the region's recovery is likely to be.

Unemployment in the eurozone's fourth-biggest economy fell in the third quarter, according to figures published Thursday. That followed a report from the Bank of Spain Wednesday predicting a return to economic growth in the quarter after a recession lasting two years.

The government is due to publish its latest GDP numbers next week.

Improvement in Spain's jobs market is crucial to a broader recovery and Thursday's figures show the country's unemployment rate fell to its lowest level in a year.

But with just under 26% of the workforce -- and more than half of all young people -- still without a job, it remains painfully high.

Spain was hit hard by the financial crisis after a housing bubble burst and many of its banks required hefty bailouts.

Saddled with high debt and borrowing costs, it began a program of austerity to control its budget deficit and structural reforms aimed at improving productivity. Exports have recovered as a result, helping drive the return to growth, but economists say the country has some way to go.

Ben May from Capital Economics said Spain's prospects had improved considerably over the past year but domestic demand remained weak.

"Spain is not out of the woods just yet," said May. He expects GDP will shrink by about 0.5% in 2014.

The cautious tone applies to Europe too.

The eurozone emerged from a prolonged recession earlier this year but growth remains anemic and uneven. After edging higher for months, business activity slipped back in October, according to a survey of purchasing managers.

The fragility of the region is a point European Central Bank President Mario ! Draghi has reinforced recently. This month he said the ECB stood ready to cut rates or pump more cheap cash into the economy if needed to keep it on course.

  Can Europe fix youth unemployment?

Weak European banks, and uncertainty about the level of risk they're still carrying, is stifling lending and investment in parts of the eurozone.

The ECB announced a 12-month health check on 128 of the region's banks Wednesday, with the aim of restoring confidence and boosting growth.

How to diversify your investment portfolio?

A: If I have to put my money, I will divide first between safe assets and risky assets and within safe assets I will go for tax free bonds and debt mutual funds and especially in today's environment where interest rate cycle is on the higher side, I will go towards long duration mutual funds. As and when interest rate cycle starts easing off I will shift them into shorter duration mutual funds but I will manage my duration bet by mutual funds rather than tax-free bonds even the tax-free bonds are liquid, I would like to hold them till maturity unless and until something dramatic happens on the credit side and I will adjust my portfolio duration through debt mutual funds.

On the other hand, on the equity side today there are various mutual funds which are available where I can do my regular investment. So, irrespective of market cycle I will continue with my SIPs and then I will wait for corrections in the market either in stocks or investments in mutual funds where I will put lump sum money wherever I believe market have become cheaper. I will wait for opportunities which will come into the market especially because of the crisis in the global markets or local markets. Whenever I see a bad headline appearing in the newspaper I will be more than happy to put my money into work by buying things cheaper than what otherwise I would have bought.

On the real estate side, I will be focused on those emerging areas of the various cities where city center is likely to expand over a period of time. So I will try to build my portfolio in a manner where in the near-term the safe assets will give me my returns and in the medium-term to long-term the risky assets will give me capital appreciation and I will ensure that on a tax adjusted basis, I pay as much minimum tax as possible under the rule of taxation. So that my post tax return is superior.

LPL to add fee for third-party portfolio platform

LPL Financial last week informed its advisers about a fee increase for a third-party money management platform, and the coming change has some advisers howling.

The fee increase affects financial advisers who use the Model Wealth Portfolios platform, according to LPL advisers familiar with the change. In January, LPL will begin charging 15 or 20 basis points on new accounts in the MWP platform for advisers who choose LPL's internal research to create model portfolios. Advisers have a variety of choices of money managers in the MWP platform, including BlackRock and JPMorgan, but until now there had been no charge for model portfolios created internally by LPL.

Introduced in late 2007, such model wealth portfolios created by LPL had not carried that management fee, according to Geoff Forcella, an adviser with family-owned Forcella Wealth Management.

Such portfolios created by third-party managers are often the bread-and-butter strategy for many reps and advisers who work with clients who have $100,000 to $1 million to invest, typically known as the “mass affluent.”

It is the third straight year that LPL's 13,000 reps and advisers are facing some type of fee increase.

In an open letter to LPL's management, including chief executive Mark Casady and president Robert More, posted on LinkedIn and Google last week, Mr. Forcella wrote: “I hope to express my disappointment, confusion and a small but honest sense of betrayal with this most recent business decision.”

“LPL's independent research team has always been viewed as a 'value-added service,” he wrote. “However, I understand the goal and need to properly fund the department. And yet I think LPL is taking the wrong course of action.”

His reasons include the current ability of LPL advisers to undercut competitors by 15 to 20 basis points on similar third-party portfolios and distrust over changing the rules of a continuing program.

“With the proposed fee change, LPL Research, I argue, is falling in line with the rest of the advisory world,” Mr. Forcella wrote. “That is not a good thing. We are witnessing fee homogeneity.”

“I am not the only one who feels slightly misled by this course of action,” he added.

His father, Jim Forcella, also signed the letter.

“LPL Financial regularly assesses its fee structures to ensure they fairly represent the services and support we provide,” spokeswoman Betsy Weinberger wrote in an e-mail. “The changes to the Model Wealth Portfolios will help bring our strategist fee structure in line with the marketplace, and enable us to invest in the LPL research team so we can continue providing market-leading solutions and outstanding services to our clients.”

Advisers widely blame the steady upticks in fees on LPL becoming a publicly traded compa! ny in November 2010 and management's subsequent attention to shareholders. Ms. Weinberger did not respond to that criticism.

LPL “seems to be more shareholder-focused” than focused on its advisers, Geoff Forcella said in an interview Monday. His father and uncle are also advisers with the firm. Because the firm uses the MWP platform heavily, LPL called him Oct. 16 to discuss the change and followed up with an e-mail the next day.

Mr. Forcella said one particularly galling change is a 15-basis-point increase to model portfolios LPL research creates using passive manager Dimensional Fund Advisors. DFA traditionally approves advisers' use its funds after a training and education process. But LPL advisers using the MWP portfolio circumvent that process, Mr. Forcella said.

Advisers choose DFA funds because of cost, Mr. Forcella wrote in his letter to LPL's management. “But now I pose the question: How can one advertise or justify the 'value added' of MWP by charging a client 1.35% — to net about 70-something basis points — on what will most likely be a strategic buy-and-hold portfolio?”

Western Digital to Buy STEC in $340 Million Deal

HGST, a wholly owned subsidiary of Western Digital (NASDAQ: WDC  ) , has entered into an agreement whereby HGST will acquire a 100% ownership stake in sTec (NASDAQ: STEC  ) in an all-cash transaction valued at $340 million, equal to $6.85 a share, the companies announced today.

According to the companies' press release, the deal "augments HGST's existing solid-state storage capabilities, accelerating its ability to expand its participation in the rapidly growing area of enterprise SSDs [solid state drives]." The STEC board of directors has unanimously agreed to the proposed buyout, and will recommend that its shareholders approve the deal.

Top 5 High Tech Companies To Buy For 2014

HGST President Mike Cordano commented, "We are excited to welcome such a talented team of professionals to HGST, where their inventive spirit will be embraced and encouraged."

The deal is expected to close in either the third or fourth quarter of 2013, and is subject to customary closing conditions. The deal represents approximately $207 million in enterprise value, net of STEC's cash as of March 31. The $6.85 per share is a 91% premium over STEC's Friday closing stock price.

link

Hot Low Price Stocks To Buy For 2014

With shares of Wal-Mart (NYSE:WMT) trading around $77, is WMT 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

Wal-Mart operates retail stores in various formats around the world. The company aims to price items at the lowest price every day. Wal-Mart operates in three business segments: the Walmart U.S. segment, the Walmart International segment, and the Sam�� Club segment. It operates retail stores, restaurants, discount stores, supermarkets, supercenters, hypermarkets, warehouse clubs, apparel stores, Sam��� Clubs, neighborhood markets, and other small formats, as well as Walmart.com and Samsclub.com. Through its retail channels, Wal-Mart is able to provide a variety of products and services at very affordable prices to consumers and companies worldwide.

Wal-Mart is an especially hot place for summer lovers to take advantage of, as it provides a one-stop shop for anything a beach bum�� heart desires.�Customers know that they can get in and out of Wal-Mart quickly and find all of their summer gear at relatively low prices.�One out of three customers give Wal-Mart�� summer products a perfect 10, and 33.8 percent assert that they would be extremely likely to recommend the store. Wal-Mart is undoubtedly looking at a very successful summer sales quarter.�For consumers and businesses looking for one location that contains a wide variety of products and services, Wal-Mart is the spot and will continue to be well into the future.

Hot Low Price Stocks To Buy For 2014: Accelr8 Technology Corporation(AXK)

Accelr8 Technology Corporation focuses on the research and development, and commercialization of proprietary surface chemistry formulation and quantitative bio-analytical measurement instruments. The company is developing BACcel system, a rapid diagnostic platform for diagnosis in life-threatening bacterial infections. It also develops and licenses OptiChem surface coatings for use in microarraying components. The company was founded in 1982 and is based in Denver, Colorado.

Hot Low Price Stocks To Buy For 2014: ACADIA Pharmaceuticals Inc.(ACAD)

ACADIA Pharmaceuticals Inc., a biopharmaceutical company, focuses on drug discovery and clinical development of novel treatments for central nervous system disorders. The company has a portfolio of four product candidates, including pimavanserin, which is in Phase III clinical development as a treatment for Parkinson's disease psychosis. It is also developing AGN-XX/YY, a product candidate in Phase II for chronic pain; and AC-262271, a product candidate in Phase I for glaucoma in collaboration with Allergan, as well as AM-831, a product candidate in IND-track development in collaboration with Meiji Seika Kaisha, Ltd. In addition, ACADIA Pharmaceuticals Inc. is developing two preclinical programs in the area of Parkinson?s disease. The product candidates in the company?s pipeline emanate from discoveries made using its proprietary drug discovery platform. The company was founded in 1993 and is headquartered in San Diego, California.

Advisors' Opinion:

• [By Selena Maranjian]

  D. E. Shaw reduced its stake in lots of companies, including Acadia Pharmaceuticals (NASDAQ: ACAD  ) and Exelixis (NASDAQ: EXEL  ) . Acadia has skyrocketed over the past year, rising more than 10-fold, on high hopes for its pimavanserin drug, which treats psychosis in patients with Parkinson's disease. If the drug gains FDA approval, it will enjoy little competition and could be a big winner for Acadia. The company thinks the drug might be effective against psychosis related to Alzheimer's disease as well and is conducting trials for that, too. Acadia is also raising about $100 million via a secondary stock offering to fund ongoing and future trials.

• [By Bio-Wire]

  Baker Bros. Advisors is a ~5 BB small & micro-cap focused biotechnology fund run by Julian Baker and Felix Baker. The fund has generated exceptional returns this year ��largely due to a huge long position they started in ACADIA Pharmaceuticals (NASDAQ: ACAD) (YTD = +481%). While the fund is quite secretive, it is required file SEC Form 13F which allows the public to see which particular biotech stocks are being accumulated.

• [By Brian Orelli]

  There goes the short-term bear thesis on ACADIA Pharmaceuticals (NASDAQ: ACAD  ) .

  I had recommended staying away from the company for now because it looked too risky with a long wait before the company could complete its second phase 3 trial for pimavanserin in patients with Parkinson's disease psychosis.

Top Dividend Stocks To Invest In 2014: Versant Corporation(VSNT)

Versant Corporation engages in the design, development, marketing, and support of object-oriented database management system products to solve complex data management and data integration problems of enterprises. Its flagship product includes the Versant Object Database, an object database management system designed to support multi-user commercial applications in distributed computing environments that enables users to store, manage, and distribute information that cannot be administered through traditional database technologies. The company also provides FastObjects, an object database management system for use as an embedded data management system to be integrated in various products, including medical devices, vending machines, telecom equipment, and defense systems; and db4o, an open source object database that enables Java and .NET developers to store and retrieve application objects with one line of code targeting the embedded device market. In addition, it offers m aintenance and technical support services; and training and consulting services to assist customers in the design, development, training, and management of applications that are built based on its core products. The company?s software is used in strategic distributed applications, such as network modeling and management, fault diagnosis, fraud prevention, and service activation and assurance, as well as in customer billing, scheduling, and other applications. It markets its products principally through its direct sales force, as well as through value-added resellers, systems integrators, and distributors to companies in telecommunications, government and defense, media, technology, financial services, transportation, and healthcare industries in North America, Europe, and Asia. The company was formerly known as Versant Object Technology Company and changed its name to Versant Corporation in July 1998. Versant Corporation was founded in 1988 and is headquartered in Redwood C ity, California.

Hot Low Price Stocks To Buy For 2014: Diploma(DPLM.L)

Diploma PLC supplies specialized technical products and services in Europe, North America, and internationally. The company?s Life Sciences segment supplies consumables, instrumentation, and related services to the healthcare and environmental industries. This segment offers consumables and instruments used in the diagnostic testing of blood, tissue, and other samples in hospital pathology laboratories; specialty electrosurgery and endoscopy equipment, and consumables for use in the operating rooms and endoscopy suites; analyzers for detecting and measuring specific elements in liquids, solids, and gases, as well as containment enclosures for potent powder handling; and equipment and services for the monitoring and control of environmental emissions. The company?s Seals segment supplies hydraulic seals, gaskets, cylinders, components, and kits for heavy mobile machinery and industrial equipment. This segment provides a next day delivery service for seals, seal kits, and cylinders used in heavy mobile machinery applications; gasket and seal kits for heavy duty diesel engines, transmissions, and hydraulic cylinders used in off road and marine applications; hydraulic kits to install attachments on excavators; O-rings, moulded and machined parts, PTFE products, and shaft seals; and precision seals for hearing aids and heavy duty seals for wind power mills. The company?s Controls segment supplies specialized wiring, connectors, fasteners, and control devices for technically demanding applications. This segment offers wiring, interconnect, electro-mechanical, and fastener products for use in a range of technically demanding applications in various industries, including defense and aerospace, motorsport, energy, medical, and general industrial; flexible braided products and multi-core cables; and control devices used in the sensing, measurement, and control of temperature and pressure. Diploma PLC was incorporated in 1931 and is based in London, the United Kingdom.

Hot Low Price Stocks To Buy For 2014: Paradigm Medical Industries Inc (PDMI)

Paradigm Medical Industries, Inc., incorporated in October 1989, develops, manufactures, markets and sells ophthalmic diagnostic instrumentation and related accessories, including disposable products. The diagnostic products that the Company manufacturers, markets and sells consist of the P60 UBM Ultrasound Biomicroscope, two perimeters - the LD 400 and the TKS 5000, and the Blood Flow Analyzer. The diagnostic products that the Company markets and sells, which are manufactured by its Italian partner, Costruzione Strumenti Oftalmici srl (CSO), are the Paramax, corneal topographers - the Paravue 300 and the Surveyor 500, and the Paracam 1000. The P60 UBM Ultrasound biomicroscope is the third-generation of UBM devices. The CSO product to be distributed and sold by the Company is the Paramax. Other CSO products to be sold by the Company are the Paravue 300, a corneal topographer with the ability to display live images on a computer monitor; the Surveyor 500, a corneal topographer with a rotating Scheimpflug camera with placido disk, and the Paracam 1000, a specular microscope for endothelial cell evaluations.

Diagnostic Eye Care Products

The Company�� diagnostic eye care products include blood flow analyzer, dicon perimeters, P60 UBM ultrasound biomicroscopes, and Paramax and other products manufactured by Costruzione Strumenti Oftalmici srl. The blood flow analyzer device measures not only intraocular pressure but also pulsatile ocular blood flow, the reduction of which may cause nerve fiber bundle death through oxygen deprivation thus resulting in visual field loss associated with glaucoma. The Company's blood flow analyzer is a portable automated in-office system that presents a method for ocular blood flow testing for the ophthalmic and optometric practitioner. The device is a portable desktop system that utilizes an Air Membrane Applanation Probe (AMAP), which can be attached to any model of standard examination slit lamp, which is then placed on the cornea of the patient! 's eye to measure the intraocular pressure within the eye.

Dicon perimeters consist of the LD 400 and the TKS 5000, and software consisting of Field Lin FieldView and Advanced Field View. Perimeters are used to determine retinal sensitivity testing the visual pathway. Perimetry is reimbursable worldwide. The Dicon perimeters feature kinetic fixation and voice synthesis in 27 different languages. The LD 400FT, or Fast Threshold Autoperimeter, is the successor to the LD 400. The device is an autoperimeter used to measure patient visual fields. The LD 400FT is identical in hardware to the LD 400 but it uses new software to enable a threshold test. The P60 biomicroscope represents the third-generation of UBM devices. The Paramax is to be sold in North America on an exclusive basis. The Paramax performs tests for the early screening and follow up of pathologies, such as glaucoma, age related macular degeneration, vascular retinal degeneration, and other optic nerve diseases.

Surgical Products

The Company�� surgical products include Precisionist Thirty Thousand, Ocular Surgery Workstation and Photon Laser System. The Precisionist Thirty Thousand is the Company's core phaco surgical technology. As of December 31, 2009, the Precisionist is not manufactured by the Company. The system features a graphic color display and on board computer and graphic user interface linked to a soft key membrane panel for flexible programmable operation. The system provides real-time on-the-fly adjustment capabilities for each surgical parameter during the surgical procedure for high-volume applications. In addition, the Precisionist provides one hundred pre-programmable surgery setups, with a second level of subprogrammed custom modes within each major surgical screen (ultrasound phaco and

irrigation/aspiration modes).

The Ocular Surgery Workstation comprises the base system of the Precisionist

Thirty Thousand and is the first system, to the Company's knowledge,! which us! es the expansive capabilities of today's advanced computer technology to offer seamless open architecture expandability of the system hardware and software modules. The Workstation utilizes an embedded open architecture computer developed for the Company and controlled by a software system developed by the Company that interfaces with all components of the system. Ultrasound, fluidics (irrigation), aspiration, venting, coagulation and anterior vitrectomy (pneumatic) are all included in the base model.

The Photon laser cataract system is designed to be installed as a seamless plug-in upgrade or add-on to the Company's Precisionist' Ocular Surgery Workstation. The Photon laser utilizes the on board microprocessor computer of the Workstation to generate short pulse laser energy developed through the patented LCP to targeted cataract tissue inside the eye, while simultaneously irrigating the eye and aspirating the diseased cataract tissue from the eye. In addition to the cataract surgery equipment, the Company's surgical systems are designed to utilize accessory instruments and disposables. These include replacement ultrasound tips, sleeves, tubing sets and fluidics packs, instrument drapes and laser cataract probes. The Company focuses on expanding its disposable accessories as it penetrates the cataract surgery market and expands the treatment applications for its Workstation.

The Company competes with Sonomed, Tomey, Nidek, OTI and Quantel.

Hot Low Price Stocks To Buy For 2014: Central European Distribution Corp (CEDCQ.PK)

Central European Distribution Corporation (CEDC), incorporated on September 4, 1997, operates primarily in the alcohol beverage industry. CEDC is a producer of vodka and is Central and Eastern Europe�� integrated spirit beverages business. During the year ended December 31, 2011, as measured by total volume, the Company produced and distributed approximately 33.2 million nine-liter cases . The Company�� business primarily involves the production and sale of its own spirit brands (principally vodka), and the importation on a basis of a range of spirits, wines and beers. Its primary operations are conducted in Poland and Russia. In addition the Company also has operations in Hungary and Ukraine. CEDC has six manufacturing facilities located in Poland and Russia. On February 7, 2011, the Company completed purchasing of the remaining stake of the Whitehall Group.

CEDC is an importer of spirits, wines and beers in Poland, Russia and Hungary. The Company mai ntains import contracts for a number of internationally recognized brands, including Jim Beam Bourbon, Campari, Jagermeister, Remy Martin Cognac, Corona, Budweiser (Budvar), E&J Gallo wines, Carlo Rossi wines, Sutter Home wines, Metaxa Brandy, Sierra Tequila, Teacher�� Whisky, Cinzano, Old Smuggler, Grant�� Whisky and Concha y Toro wines. In addition to its operations in Poland, Russia, and Hungary the Company has Ukraine and distribution agreements for its vodka brands in a number of key export markets including the United Kingdom, Ukraine, the Baltics and the CIS for Green Mark, Zhuravli, Parliament and Zubrowka, the United States, Japan, the United Kingdom, France for Zubrowka and many other Western European countries. In 2011, exports represented 11% of its sales by value.

Poland

In Poland, CEDC is the vodka producers with a brand portfolio that includes Absolwent, Zubrowka, Zubrowka Biala, Bols, Palace and Soplica brands, each of which it p roduces at its Polish distilleries. It produces and sells ! vo! dkas primarily in three vodka sectors: premium, mainstream, and economy. The Company owns two production sites in Poland: one in Oborniki and one in Bialystok. In the Oborniki distillery, it produces the Bols and Soplica vodka brands, among other spirit brands. In Bialystok it produces Absolwent and Zubrowka. Zubrowka is also exported out of Poland to many markets around the world, including the United States, England, Japan and also France. In addition to the Absolwent and Zubrowka brands, in Bialystok it produces the Zubrowka Biala brand. The Company has rights to import and distribute approximately 70 brands of spirits, wine and beer into Poland. It also provides marketing support to the suppliers. During 2011, the Company sold approximately 10.7 million nine-liter cases of vodka, wine and spirits through its Polish business during 2011 including both its own produced vodka brands as well as its exclusive agency import brands. During 2011, the Company sold approximately 1 91 thousand nine-liter cases of Zubrowka outside of Poland. During 2011, the Company�� Polish operations accounted for 26.3% of its revenue.

Russia

CEDC produces Green Mark in Russia and the sub-premium vodkas in Russia, Parliament and Zhuravli. During 2011 the Company introduced new brands to the Russian market Talka, Sotka and Silver Blend. The Company also produces Yamskaya, the economy vodka in Russia, and premixed alcohol drinks, or long drinks. The Company also owns Whitehall, which holds the exclusive rights to the import of such leading premium wine and spirit brands as Concha y Toro, Paul Masson, Robert Mondavi, DeKuyper, Jose Cuervo and Label 5. In addition to these import activities, Whitehall has distribution centers in Moscow, Saint Petersburg, and Rostov as well as a wine and spirits retail network located in Moscow. During 2011, the Company�� Russian operations accounted for 70.2% of its revenue. During 2011,the Company produced a nd sold approximately 16.6 million nine-liter cases of! vodka! t! hrough ! its Russian business in the main vodka segments in Russia: premium, sub-premium, mainstream, economy and cheap. In addition it produced and sold approximately 2.8 million nine-liter cases of long drinks.

Hungary

The Company sells Royal Vodka in Hungary through its Bols Hungary subsidiary. The imported brands to Hungary include Bols Vodka, Zubrowka, Royal Vodka, Campari, Cinzano, Jaegermeister, Bols Liqueurs, Cointreau, Carolans, Galliano, Irish Mist, Jose Cuervo, Calvados Boulard, Remy Martin, Metaxa, St Remy, Grant��, Glenfiddich, Tullamore Dew and Old Smuggler.

Hot Low Price Stocks To Buy For 2014: Odyssey Marine Exploration Inc.(OMEX)

Odyssey Marine Exploration, Inc. provides shipwreck exploration services for use in insurance investigations, and search and recovery operations to governments and deep-ocean mineral exploration companies. The company?s shipwreck projects consist of various activities, including research and development, and search operations; archaeological excavation and recovery operations; and conservation, recording, and documentation. It also sells shipwreck findings, including coins and other mass-produced cargo, cultural collections, and replicas to collectors, museums, and other institutions. Odyssey Marine Exploration, Inc. was founded in 1986 and is headquartered in Tampa, Florida.

Advisors' Opinion:

• [By Rich Duprey]

  Despite silver falling to around $23 an ounce, and gold going below $1,400, now might be the time to invest in Odyssey Marine Exploration (NASDAQ: OMEX  ) , the treasure-hunting shipwreck finder whose own stock is down by a third from its 52-week high.

• [By Jonathan Yates]

  That is certainly a better way to profit from gold, SPFR Gold Shares (NYSE: GLD), and silver, iShares Silver Trust (NYSE: SLV). Both the GLD and the SLV have plunged, but sea treasure recovery is very profitable. The find today demonstrates that fact of investing! Odyssey Marine Exploration (NASDAQ: OMEX) had a huge haul off the coast of Ireland earlier this summer, which is more proof of the profit potential for this industry!!.

• [By Sean Williams]

  Odyssey Marine Exploration (NASDAQ: OMEX  )
  I love a good metals play as much as any Fool around here, but Odyssey Marine is certainly not on the buy list. Odyssey Marine is a salvage company that searches for, recovers, and monetizes metals and minerals found on the ocean floor. Make no mistake about it, the job is as cool as it sounds; unfortunately, "cool" doesn't always translate into solid profits.

• [By Jonathan Yates]

  Investors around the world are becoming more aware of the potential riches to be made by companies in the sea treasure recovery industry such as J.D. Hutt (PINK JABA) and Odyssey Marine Exploration (NASDAQ: OMEX) due to the media attention being paid to the raising of the Concordia. More than $60 billion rests on the ocean floor in gold (NYSE: GLD), silver (NYSE: SLV), and other valuables. As detailed in a previous article on this site, Odyssey Marine Exploration just presented at the 2013 Gateway Conference.

Hot Low Price Stocks To Buy For 2014: Choice Hotels International Inc. (CHH)

Choice Hotels International, Inc., together with its subsidiaries, operates as a hotel franchisor worldwide. It franchises lodging properties under its proprietary brand names, including Comfort Inn, Comfort Suites, Quality, Clarion, Sleep Inn, Econo Lodge, Rodeway Inn, MainStay Suites, Suburban Extended Stay Hotel, Cambria Suites, and Ascend Collection brands. As of March 31, 2011, it operated 6,128 open hotels comprising 492,733 rooms, as well as 606 hotels consisting of 49,908 rooms under construction, awaiting conversion, or approved for development in 49 states, and the District of Columbia in the United States; and approximately 40 countries and other territories. The company was founded in 1981 and is based in Silver Spring, Maryland.

Advisors' Opinion:

• [By Seth Jayson]

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

• [By Sean Williams]

  Don't make the wrong Choice
  I predict that 2013 will be the return of the "staycation." In the depths of the recession, instead of taking expensive getaways, consumers chose simply to take time off work and stay home or locally. I think we have the perfect confluence of factors that could make life difficult for Choice Hotels International (NYSE: CHH  ) , operator of Comfort Inn, Comfort Suites, and a multitude of other mid-price-point hotels.

• [By Jeremy Bowman]

  What: Shares of Choice Hotels (NYSE: CHH  ) were getting picked last by investors today, falling 11% after cutting EPS guidance in its quarterly report.

Evensky, Friedman, Mellan at Think Retirement Income Conference

If you’re known by the company you keep, as an advisor you couldn’t be in better company than the fellow advisors and industry gurus who will gather in Boston starting Thursday morning, Oct. 10 for the Think Retirement Income conference. While we can’t pretend to be objective, Investment Advisor Editor-in-Chief John Sullivan has put together a dynamite program whose intent is to help advisors solve the retirement income puzzle, in large measure by learning from your peers. 

The programming for this retirement planning conference with a difference was devised with the help of an all-star advisory board that includes folks like Harold Evensky, Greg Friedman, Charlie Farrell, Michael Kitces, Rob Francais and—well, the complete list is here. Many of these luminaries will sit on interactive roundtables during the show,  that runs through midday Friday, Oct. 11, with other successful RIAs.

(Some seats are still available for the conference, being held at the Hyatt Regency Boston. You can register online here.) 

The conference will be bookended by opening day keynote speaker Charles Ellis, the management consultant and author, who will share his thoughts on What It Takes: Seven Secrets of Success from the World’s Greatest Professional Firms, with the closing keynote delivered by the always enthusiastic and inspirational Tim Noonan of Russell Investments. 

A number of other regular contributors to Investment Advisor and Research magazines and ThinkAdvisor will also be presenting, including Olivia Mellan, Ben Warwick, Philip Palaveev, Matt Greenwald, Bob Seawright, Gavin Morrissey, Ron DeLegge and Friedman. 

Look for more preview coverage now and onsite coverage on ThinkAdvisor; the Twitter hashtag for the event will be #ThinkRetirement.

View the complete agenda here, and register for the conference here.

‘London whale’ costs JPMorgan $100 million more

JPMorgan Chase will pay a $100 million fine and admit to reckless conduct and market manipulation in connection with its 2012 "London whale" trading debacle, the Commodity Futures Trading Commission announced Wednesday.

With the latest fine, the bank's total penalties for the London whale case top $1 billion. Last month, JPMorgan agreed to pay $920 million to settle charges brought by the Federal Reserve, the Comptroller of the Currency, the Securities and Exchange Commission and Great Britain's Financial Conduct Authority.

That's on top of the losses the trading ultimately cost the bank — an estimated $6.2 billion.

In a statement, JPMorgan said it neither admitted nor denied the CFTC's legal conclusion that there was a violation.

"We are pleased to be able to put behind us another aspect of the (Chief Investment Office) trading matter by the resolution of the CFTC investigation," the bank said.

The scheme, as outlined by regulators, was as simple as the financial instruments it involved were complex.

The bank had sold short a basket of credit derivatives, betting on their value to fall. Each month, traders had to report their profits or losses for the month, and in February 2012 they faced huge losses on a bet that had reached $65 billion in value. To drive down the price of the derivatives, JPMorgan sold another $7 billion of the instruments short in one day, which reduced losses on the bank's existing bets by creating artificial selling pressure, regulators said.

"They were short protection, and they sold more protection,'' the commission said in its statement. "The Commission is now better armed than ever to protect the market from traders, like those here, who try to 'defend' their position by dumping a gargantuan, record-setting, volume of swaps virtually all at once, recklessly ignoring the obvious dangers to legitimate pricing forces."

Despite the newest London whale settlement, JPMorgan still faces a criminal investigation of the trading episode! by federal prosecutors. Two former JPMorgan employees involved in the London whale trades are also facing federal criminal charges and SEC civil charges.

JPMorgan, the nation's largest bank, is under intense scrutiny from multiple regulators for its conduct in a variety of matters before and since the 2008 financial crisis.

Last week, the bank said it had set aside $23 billion in reserves to pay for settlements and litigation expenses. It is currently negotiating a settlement with the Justice Department over its handling of mortgage-backed securities that could reach a reported $11 billion. Including settlements already paid out, and others for which it has not yet established reserves, JPMorgan said its exposure to claims stemming from the financial crisis could top $36 billion.

The bank reported a $380 million loss for the third quarter after increasing those reserves by $9.2 billion.

Unemployment claims surge, partly due to shutdown

About 374,000 people filed for their first week of unemployment benefits last week, the largest one-week rise since November 2012.

NEW YORK (CNNMoney) First-time claims for unemployment benefits suddenly jumped last week, marking the biggest one-week rise since Superstorm Sandy left thousands of people temporarily out of work.

The rise was partly due to the government shutdown, as well as other temporary factors, the Department of Labor said.

About 374,000 people filed for their first week of unemployment benefits last week, 66,000 more than just a week earlier. It was the largest one-week rise since November 2012, when unemployment claims surged by 88,000 in the week following Superstorm Sandy.

Because initial unemployment claims closely correlate with layoffs, this report is considered one of the foremost economic indicators. But a series of recent temporary factors have muddled the numbers lately.

Last week for example, half the jump in claims came from California alone. The state labor agency has been struggling to keep up with claims after upgrading its computer system last month. A processing error has delayed unemployment checks for many people in the state, causing hardship for those who relied on the money to pay bills and feed their families.

The national data was also partially impacted by the government shutdown, as about 15,000 claims came from private sector workers who rely on business from the federal government. Those workers may include anyone from government contractors, to tour bus drivers who offer trips to national parks, to waitstaff at DC-area restaurants frequented by federal employees.

As the government shutdown drags on for the tenth-straight day, nearly 500,000 federal workers remain on furlough. They are allowed to file for unemployment benefits, but if Congress grants them their pay retroactively, most states will ask them to repay the money later.

Today's report does not include federal workers who may have filed for unemployment benefits during the government shutdown. The Labor Department counts those workers in a separate category, but that data lags by three weeks.

Best Stocks To Invest In Right Now

Accounting for all these temporary factors, it looks like there would have been roughly 326,000 initial claims last week, if it were! n't for California's computer glitch and the government shutdown. That's roughly in line with a four-week average, so economists interpret the report as showing little change in the underlying job market.

"The broader picture is still that labor market conditions are improving, albeit not quite as much as we previously thought," said Paul Ashworth, chief U.S. economist for Capital Economics, in a research note.

Nationwide, about 2.9 million people received their second week or more of unemployment benefits in the week ending September 28, the most recent data available. These people account for only about a quarter of the 11 million people who remain unemployed in the United States. The other 75% do not receive unemployment benefits.

American Electric Earnings: Can Coal Deliver for This Dividend Stock?

American Electric Power (NYSE: AEP  ) reported earnings last week, beating sales estimates and matching earnings expectations. With a bigger distribution for investors around the corner, let's take a look to see if this dividend stock has what it takes to pull sustainable profits for your portfolio.

Number crunching
American Electric's Q1 sales clocked in at $3.8 billion, slightly above analysts' $3.78 billion expectations and 4.8% above Q1 2012's revenue . In a year of falling sales for most utilities, American's top line increase is a welcome sign for income investors.

Bottom-line numbers also kept up with Mr. Market's predictions, with $0.80 adjusted EPS. For a peck of perspective, AEP's sales have bumped up a slight 3.5% over the past five years. In the same time, diluted EPS has dipped 24%.

AEP Revenue Annual data by YCharts

 

A position to transition
To understand American Electric today, we have to head back to 2011 and look forward to 2015. Two years ago, Ohio announced it would deregulate its utilities, and two years from now marks the date when markets will go fully competitive in the Buckeye State. FirstEnergy (NYSE: FE  ) has been busy grabbing American Electric customers, knocking $11 million off AEP's Q1 earnings despite colder weather and successful rate proceedings.

As the dividend stock revamps its regulated operations, its generation portfolio is heading back to coal country. AEP is dropping natural gas in favor of coal, a move that should keep costs competitive in the near future. Rising natural gas prices are expected to increase coal demand 7.8% in the next year, a movement that neatly mirrors AEP's 9% year-to-date increase in coal generation.

As utilities such as Atlantic Power (NYSE: AT  ) add on to their natural gas capacity, rising costs could cut into profits in the quarters to come. Atlantic currently relies on natural gas for 58% of its generation capacity, and although the utility is also adding on to its renewables, more natural gas is not what the dividend doctor ordered.

AEP relies on coal for about 66% of its generating capacity, comparable to TECO Energy's (NYSE: TE  ) 61% coal capacity. TECO takes its coal cravings a step further with vertical integration, pulling 9 million tons of solid black gold annually from its Appalachian mines.

Dividend for the win?
Even as AEP recovers from its Ohio deregulation and focuses on coal, the company announced a 4.3% dividend increase earlier last week. Investors are heading back to Mr. Market after the Great Recession, but utilities are less confident about their own investments. With low expectations for electricity demand growth, dividend stocks are upping their payouts to keep their books from becoming bloated. Southern (NYSE: SO  ) also announced a higher distribution two weeks ago, but American Electric seems to be in the most sustainable situation to live up to its status as a dividend stock.

AEP Cash Div. Payout Ratio TTM data by YCharts

 

Foolish bottom line
American Electric's in a transition mode, and its short-term coal capitalization doesn't spell out long-term success. But the company's management is making smart moves, and its books are some of the most balanced in the business. I'm holding off on bull-versus-bear until I see where AEP focuses its future, but this most recent quarter keeps the utility in the running for any dividend stock portfolio.

As the nation moves increasingly toward clean energy, Exelon is perfectly positioned to capitalize on having the largest nuclear fleet in North America. This strength, combined with an increased focus on balance sheet health and its recent merger with Constellation, places Exelon and its resized dividend on a short list of the top utilities. To determine if Exelon is a good long-term fit for your portfolio, you're invited to check out The Motley Fool's premium research report on the company. Simply click here now for instant access.

A "Double Growth" Stock Like This Is the Perfect Fiscal-Cliff Defense

First, it was the mess in Syria.

Then we had to deal with the whole Team Bernanke "taper drama."

And now we're barreling into yet another "Fiscal Cliff" street fight.

With U.S. stocks trading at unsustainable highs, I can sympathize with those of you who look at these headlines with fear; you view each day's events as just the latest potential investing calamity, and worry they might ignite a single-day sell-off severe enough to eviscerate years of diligent saving and personal sacrifice.

I can even understand why many of you would like to scamper to the supposed safety of the sidelines.

But don't do it.

The sidelines, you see, aren't as safe as you might think. Missing the good days can be worse than riding out the bad ones. And you run the very real risk of getting left behind.

Plus, there's a way to stay invested - one that allows you to capture life-changing profits.

I'm going to tell you about it today.

And I'm even going to show you the one stock that will let you put this "Fiscal Cliff" defense strategy to work...

In Growth We Trust

If you've been joining our talks over at the Strategic Tech Investor over the past six months or so, then you know that I'm a big believer in the profit power of high-tech growth stocks.

I want my readers to break free of the "zero-net-worth" syndrome that afflicts far too many of America's households.

My Five Tech Wealth Rules have already delivered some very big winners for many of you. And a number of the remaining recommendations have set the table for profits still to come.

Over the long haul, I firmly believe that high-quality, tech-focused growth stocks are the key to meaningful wealth.

But I've also said there's room for solid dividend plays ... especially the kind of higher-yielding tech companies that are continuing to growth their businesses.

Indeed, now's a very good time to be looking for just that kind of stock.

U.S. companies are fat with cash right now and have nearly $1.7 trillion on their corporate balance sheets.

And as I'm going to show you, tech firms top that list.

New Doings in Redmond

Just last week, in fact, Microsoft Corp. (Nasdaq: MSFT) said it was boosting its dividend by a whopping 15%.

The elevated dividend will cost the company an extra $1 billion a year. But with $56 billion in cash and equivalents on hand as of June 30, the Redmond, Wash.-based Microsoft made a move that will hearten existing shareholders and draw in new institutional players - without hampering the company's strategic flexibility one iota.

With shares of the world's dominant marketer of PC software currently trading at about $33.50, the new 23-cent payout brings Microsoft's dividend yield to a very decent 2.7%.

In fact, "very decent" may be an understatement ...

We've all heard pundits repeatedly talk about "historically low" interest rates.

But have you really stopped to look at what this actually means? Because it's pretty doggone dramatic.

As of last week, the yield on a one-year U.S. Treasury note was a mere 0.10%. Basically, for every $100 you lend to the government for the next year, they give you back a dime.

So if we use U.S. Treasury yields as our yardstick, Microsoft's dividend payout makes it seem like Fed Chief Ben Bernanke personally handed us the keys to a bank vault.

Assuming the stock merely breaks even over the next year, for every $100 you invest, you get back $2.70. That's roughly 24.5 times the return you get on short-term U.S. bonds.

And Microsoft is our kind of dividend stock - the kind that I referenced above. It's a company that offers a nice payout - and has a shot at some substantive upside growth. (As the investment pros that I deal with would say, it's a stock that offers a strong and potentially growing income stream... with the chance for capital appreciation.)

In the parlance of institutional players, there's suddenly "upside potential" in this leader-turned-laggard because there are some very clear "catalysts" at work.

In the last several months, Microsoft has unveiled a sweeping corporate restructuring. It has said that longtime CEO Steven A. Ballmer will retire, and the company announced a $7.2 billion deal involving the mobile-devices unit of Nokia Corporation (ADR) (NYSE: NOK).

I don't think the stock will just stand still for the next year. If it can even manage to match the previous one-year gain of 7.3%, your "total return" (capital appreciation plus the dividend payout) rises to 10%.

That kind of return might fit nicely in a portion of your portfolio - say, in your kid's college savings account ... where slow-and-steady is a great way to plan ahead and still sleep soundly at night.

A New King in Cupertino

We're seeing a very similar story over at Apple Inc. (Nasdaq: AAPL). Last year, new CEO Tim Cook decided to use some of the i-Device pioneer's $100 billion cash hoard to pay a special dividend to shareholders. That $2.65 payout worked out to a 1.8% yield.

Since then, the Cupertino-based Apple has announced plans to pay a regular dividend. The current payout of $3.05 a share was up 15% from its February predecessor - and represents about a 2.6% yield at current prices.

There's a new growth story taking root at Apple, as well, with record-setting sales of the new iPhone, a hot new mobile operating system, and a racy new chip that's lighting up global tech blogs.

Thanks, in part, to these developments, the onetime tech titans of Microsoft and Apple have reinvented themselves as growth-and-income plays.

But as new members of the dividend-payout club, it'll be quite some time before either of these two digital tech players can join a group of elite stocks known as Dividend Aristocrats.

And that brings us to the "Fiscal-Cliff defense" stock that I want to tell you about today.

A New Aristocrat

This group of income-producing aristocracy is composed of about 50 stocks that have a history of increasing their dividends for 25 straight years. The list spans roughly 10 business sectors and includes companies that still have room to grow.

As luck, one of my favorite medical technology stocks was added to the list two years ago.

I'm talking about the Minneapolis-based Medtronic Inc. (NYSE: MDT), a company that I've followed for many years.

Medtronic is the world's largest independent medical technology company. About half of the company's business is devoted to heart-problem treatments. The rest is apportioned among vascular diseases, diabetes, neurological conditions, surgical technologies, and spinal care.

Not long after its founding in 1949, Medtronic pioneered the use of electrical stimulation to treat irregular heartbeats. Today it's a global firm that does business in 140 countries.

And if we peruse some of the financial metrics that I use to analyze the stocks I recommend at Strategic Tech Investor, it's clear that this is a very profitable company.

Medtronic has a profit margin of 21% and a return on stockholders' equity (ROE) of 21%. It posted a 10% increase in profits last quarter.

But given the valuation levels that we're seeking in many U.S. stocks, Medtronic's shares aren't at all pricey. With a market cap of $53.8 billion, the stock trades at $53 a share and has a forward Price/Earnings (P/E) ratio of about 13.

This stock also underscores the strength of our thesis about how high-tech dividend plays can be used to offset worrisome headlines and other troubling market developments - the "potential investing calamities" that I referenced at the start of our talk today.

And this potential calamity is Obamacare.

The pundits and other so-called "experts" predicted that this stock and others like it were going to get pole-axed by Obamacare. The reason: The new healthcare plan hits medical-device makers with a 2.3% excise tax that analysts were saying would be difficult to pass on to customers.

Instead of getting pole-axed, Medtronic pole-vaulted: Even with the market's weak August, Medtronic is up 29% year to date - or 60% better than the 18% surge of the benchmark Standard & Poor's 500 Index.

Medtronic's ability to shrug off the downer developments of Obamacare was twofold in nature.

First, the company has been adding global muscle - thereby increasing the amount of its business that's not subject to Obamacare's most onerous elements.

And, second, Medtronic took a page out of its own business plan and shocked its dividend by 7.7%. That boosted the payout to 28 cents a share - and gave the shares a comforting 2% yield.

Expect this "growth-in-business/growth-in-dividends" strategy to continue.

Here's why.

Over the next several years, Medtronic plans to greatly increase sales in emerging markets. Last year, it bought China's Kanghui Holdings, a specialist in orthopedics, a burgeoning sector in the world's most populous nation. And recent reports show that the medical-device firm has been hiring more in China.

And now that Medtronic has joined the "Dividend Aristocrats" club, expect the company to keep boosting its dividend. There's a tacit marketing value in being part of that elite group. The "aristocrat" strategy is detailed in thousands of media reports each year, money managers base strategies and paid products around it, and dividend-focused institutional investors key in on them as income stocks of the highest quality.

In the meantime, Medtronic keeps running its basic businesses with a relentless commitment to growth through innovation.

Late Monday, for instance, at the Heart Failure Society of America's 17th Annual Scientific Meeting, Medtronic announced that brand-new clinical trial results showed that heart-failure patients treated with a company-enhanced defibrillator experienced a 46% reduced risk of atrial fibrillation - a common heartbeat rate or rhythm issue.

Top 10 Safest Stocks To Watch Right Now

That's a great example of why I like this company. Remember, Medtronic pioneered electrical stimulation of the heart way back in the very early 1950s - developing the core competency on which the company's future was built.

Unlike so many companies, Medtronic hasn't forgotten the fundamental know-how that first made it a leader. And by continuing to invent, and then improve on those inventions, Medtronic built itself into a great company and then added other bits of know-how along the way.

This is just one of those tech-related stocks that will magnify the value of your stake over time - and that will also pay you handsomely while you wait for that payoff.

Why You Should Invest in This Auto Parts Supplier

As the U.S. automobile industry recovers, auto parts suppliers are expecting to see increasing sales volumes. Particularly firms such as Delphi Automotive (DLPH) and Stoneridge Inc. (SRI), which specialize in electronic components, expect to make large profits. Increasingly electrified vehicles, higher demand for hybrid and electric powertrain vehicles and stricter governmental emissions regulations should drive revenue growth for these firms in coming years.

A Narrow-Moat Auto Parts Supplier

Delphi is a large auto parts supplier, which handles electrical architecture, powertrain, safety and electronics. The firm makes around 45% of its revenue in Europe, yet its largest customer is General Motors, with roughly 20% of revenue stemming from the Detroit giant. The company's business strategy consists in following trends in the automotive parts industry, such as the rising demand for greener technology.

As the auto market shifts towards fuel efficient and electric vehicles, Delphi's sales are expected to grow faster than the average growth rate in global vehicle demand. The firm's power modules, converters and battery packs, for example, provide the electric and hybrid car industry with technology that is in high demand. Also, as electronic architecture in vehicles becomes increasingly complex, the company can benefit from products like wire harnesses, connectors and smart distribution boxes.

By meeting clean air standards set by governments and improving automakers' fuel economy, Delphi can stay ahead of competitors. In addition, the firm's operations in low-cost countries, along with its manufacturing discipline, must also be noted. As production volume increases, this should enable a great deal of operating leverage.

Delphi's narrow economic moat, which stems from its intellectual property and cost advantage over competitors, has been noted by James Barrow of Barrow, Hanley, Mewhinney & Strauss. The guru recently increased his stake in the firm by roughly 166! %, bringing his total holdings to over 9.5 million shares. Delphi is now trading at 17.1 times its trailing earnings, which translates to a slight price premium relative to the industry average of 15.4. Despite the premium, I agree with Barrow on his purchase, as I too feel highly optimistic about this stock.

Hot Insurance Stocks To Own Right Now

Risky Business

Stoneridge provides electronic components, control devices and systems for cars, trucks and agricultural vehicles. Roughly 50% of the company's sales are generated by its electronic segment, which is responsible for instrument clusters and display systems production for commercial vehicle original-equipment manufacturers, or OEMs. Innovative products in this sector, along with increasing demand for electronics, have driven the company's growth.

The increase in electronic content in vehicles, due to the introduction of electric vehicles and the penetration of hybrid cars, is bound to continue. This could be highly beneficial for Stoneridge as demand for its products is expected to rise in the long term, bringing about interesting growth rates. By dealing mainly with commercial vehicle OEMs, which are also exposed to the cross-over vehicle fuel economy, the company can achieve more attractive contract terms than with light vehicles OEMs. Since medium and heavy-duty trucks require more electronics than small vehicles, and electronic components are in high demand, Stoneridge can take full advantage of its long-term contracts with OEMs.

Despite the positive outlook in a market that is seeing increasing per-vehicle electronic content, the company has financial issues, which could be a problem looking forward. A large debt burden and the corresponding interest payments, constrain the firm's ability to reinvest. Also, the company's reliance on Navistar and John Deere for approximately 35% to 40% of annual revenue could be trouble! some. Nav! istar has not yet recovered from a failed engine product line, which did not meet U.S. Environmental Protection Agency requirements for diesel emissions. Considering the troubles the company is facing, I feel pessimistic about this stock, and it comes as no surprise that Guru George Soros of Soros Fund Management LLC sold all his holdings in the company.

Follow the Guru

Although a recovering U.S. automobile market and the increasing demand for electronic components provide a stimulus for both companies, I think Delphi is the wiser investment option. The firm boasts low costs with a strong financial position, lots of free cash flow, a large operating margin and a narrow economic moat that works to its advantage. The fact that James Barrow holds a large position in the company should provide shareholders with an extra portion of optimism regarding this stock.

Disclosure: Patricio Kehoe holds no position in any of the mentioned stocks.

Carlyle-to-Bass Backed Mortgage Insurer NMI Files for IPO

NMI Holdings Inc. (NMIHZ), a mortgage insurer backed by funds tied to Carlyle Group LP (CG) and Kyle Bass, filed to sell shares in an initial public offering as investors bet on a housing-market rebound.

FBR & Co. (FBRC) is leading the sale, according to a regulatory filing today from Emeryville, California-based NMI. The company said it's seeking to raise $25 million, a placeholder amount used to calculate registration fees, according to the document.

Investors have poured cash into mortgage insurance this year as home prices rise, pushing up shares of MGIC Investment Corp. (MTG) and Radian Group Inc. (RDN) by more than 100 percent, and buying their notes in offerings. Essent Group Ltd. (ESNT), a mortgage guarantor funded amid the financial crisis by Goldman Sachs Group Inc. and billionaire George Soros, filed last month for an IPO. The companies cover losses when homeowners default and foreclosures fail to recoup costs.

"As the U.S. housing market continues to recover, the demand for private capital to insure mortgage risk and to facilitate secondary market loan sales will grow," NMI said in the filing.

Claren Road Asset Management LLC, the hedge fund majority owned by Carlyle, is NMI's largest backer, with a 12.6 percent stake, according to the filing. Bass's Hayman Capital Management LP has 9.9 percent and Blue Mountain Capital Management LP owns 9.8 percent. Funds overseen by Perry Corp. have 7.2 percent.

Claren and Perry also have investments in publicly traded mortgage guarantors, according to data compiled by Bloomberg. Hedge fund manager John Paulson has invested in the companies as part of a bet on a recovery in the U.S. housing market. Mortgage insurance is typically required when borrowers pay less than 20 percent of the cost of their home upfront.

Housing Rebound

Home prices rose by the most in more than seven years in the 12 months through July, according to the S&P Case-Shiller index of property values in 20 U.S. cities. Private mortgage guarantors are also benefiting as the U.S. reduces its role insuring home loans.

NMI was founded in 2011 and raised $550 million in a private share sale in 2012, according to the filing. The firm, led by Chief Executive Officer Bradley Shuster, a former manager at PMI Group Inc., began selling mortgage insurance in April.

Best Safest Companies To Watch For 2014

Stockholders' equity was about $456 million as of June 30, according to the filing. The filing doesn't show how many shares existing holders plan to sell.

Fannie Mae, the government-controlled mortgage buyer, obtained insurance on a pool of about $5 billion of home loans from NMI, according to a July statement.

Mortgage insurers PMI and Triad Guaranty Inc. (TGICQ) filed for bankruptcy after housing crashed. Old Republic International Corp. also retreated from the mortgage guaranty business.

NMI applied to list on the Nasdaq Stock Market under the symbol NMIH, according to the filing. The company filed as an "emerging growth company" under the Jumpstart Our Business Startups Act, allowing for reduced disclosure.

3 Mortgage Stocks to Buy Now

Popular Posts: 7 Biotechnology Stocks to Buy Now17 Oil and Gas Stocks to Sell Now4 Pharmaceutical Stocks to Buy Now Recent Posts: 3 Mortgage Stocks to Buy Now 3 Mortgage Stocks to Buy Now 4 Capital Markets Stocks to Sell Now View All Posts

The grades of three Mortgage stocks are better this week, according to the Portfolio Grader database. Every one of these stocks has an “A” (“strong buy”) or “B” overall (“buy”) rating.

Radian Group (NYSE:) is making progress this week as its rating of C (“hold”) from last week increases to a B (“buy”) rating this week. Radian Group provides credit-related insurance coverage and financial services to mortgage lenders and other financial institutions. In Portfolio Grader’s specific subcategory of Earnings Revisions, RDN also gets an A. .

This week, Home Bancorp, Inc. (NASDAQ:) pushes up from a C to a B rating. Home Bancorp is a federally chartered mutual savings bank. .

5 Best Dividend Stocks To Invest In Right Now

WSFS Financial Corporation (NASDAQ:) gets a higher grade this week, advancing from a C last week to a B. WSFS Financial is a savings and loan holding company, which provides residential and commercial real estate, commercial and consumer lending services, as well as retail deposit and cash management services. .

Louis Navellier’s proprietary Portfolio Grader stock ranking system assesses roughly 5,000 companies every week based on a number of fundamental and quantitative measures. Stocks are given a letter grade based on their results — with A being “strong buy,” and F being “strong sell.” Explore the tool here.

Treasuries rise after Fed officials say economy needs support

Treasury 10-year note yields dropped to almost the lowest level this month as Federal Reserve Bank of New York President William C. Dudley said the U.S. economy has yet to show “any meaningful pickup” in momentum.

Prices of government securities rose for a second day after Dudley said policy makers must “forcefully” push against economic headwinds as the U.S. has yet to show “any meaningful pickup” in momentum. Atlanta Fed President Dennis Lockhart also spoke and Dallas Fed President Richard Fisher will deliver a speech Monday. Debate over the U.S. federal budget and the debt ceiling, is also renewing concern of a government shutdown, debt default or near-miss that may roil financial markets.

“Dudley's comments were pretty dovish across the board,” said Jason Rogan, managing director of U.S. government trading at Guggenheim Securities LLC, a New York-based brokerage for institutional investors. “It's important to see what their thinking is and how strongly convinced they are on the non- tapering approach.”

The benchmark 10-year yield fell three basis points, or 0.03 percentage point, to 2.7% at 11:14 a.m. New York time, according to Bloomberg Bond Trader prices. The 2.5% note maturing in August 2023 rose 8/32, or $2.50 per $1,000 face amount, to 98 8/32.

The yield dropped 15 basis points last week, the steepest decline since the period ended July 12. The 10-year note yield fell on Sept. 18 to 2.67%, the lowest since Aug. 13.

The Treasury is scheduled to sell $33 billion of two-year securities tomorrow, $35 billion of five-year notes the following day and $29 billion of seven-year debt on Sept. 26.Fed Speakers

On Monday, the Fed purchased $3.7 billion of Treasuries maturing from June 2019 to July 2020 as part of its stimulus program.

“The economy still needs the support of a very accommodative monetary policy,” Dudley, who is vice chairman of the Federal Open Market Committee, said Monday in the text of remarks for a speech in New York. “Improving economic fundamentals versus fiscal drag and somewhat tighter financial conditions are pulling the economy in opposite directions, roughly canceling each other.”

Fed Chairman Ben S. Bernanke cited the danger to the economy from the budget battles as one reason the central bank decided not to pull back on its monetary stimulus.

“Upcoming fiscal debates may involve additional risks to financial markets and to the broader economy,” Bernanke said at a Sept. 18 news conference following the Fed's two-day meeting.

Fed Vice Chairman Janet Yellen is the leading candidate to replace Bernanke if he steps down in January, according to a survey by Bloomberg News. Lawrence Summers, who was seen as the probable pick and more likely to tighten monetary policy sooner, withdrew his candidacy.

Lockhart who also spoke in New York, said U.S. monetary policy should focus on creating a more dynamic economy following a recent slowing in growth. Fisher will speak at the Independent Bankers Association of Texas Annual Convention in San Antonio.

The market for U.S. government debt has yet to react to any potential impasse over raising the borrowing ceiling. Treasuries that mature on Oct. 15 yield negative 0.04%, compared with negative 0.03% two weeks earlier. The rate on debt due Nov. 7 have risen to 0.015% from 0.005% during that span.

“People are still regrouping,” said Jim Vogel, head of agency-debt research at FTN Financial in Memphis, Tennessee. “People are not going to make any major commitments until next week's economic data. There's no obvious market impact from the politics, instead it's the potential drag to! the economy. The range on the 10-year yield is 2.68% to 2.78% this week.”

Treasuries have lost investors 2.95% this year, according to Bloomberg U.S. Treasury Bond index. The securities returned 2.2% in 2012.

Demand for new Treasuries from their biggest owners is proving impervious to rising yields and the retreat of Wall Street dealers.

Bids submitted by investors including mutual funds, foreign central banks, pension managers and insurance companies totaled 83% of Treasury debt auctioned this year, compared with 84% in 2012 and 37% in 2008 at the peak of the worst financial crisis since the Great Depression, according to data compiled by Bloomberg.Sovereign Funds

Top 5 Tech Stocks To Buy For 2014

Consistent demand from investors who control 81% of the $11.6 trillion in Treasuries is helping balance declining purchases from bond dealers and individuals in the worst year for government debt since 2009. Yields are rising as the economy improves, the U.S. prepares to refinance a record $1.38 trillion next year, the budget deficit shrinks to the least since 2008, the Fed plans to reduce its stimulus and Congress battles Obama over raising the borrowing limit.

“Sovereign wealth funds and central banks are going to continue to have demand for Treasuries,” said James Sarni, senior managing partner in Los Angeles at Payden & Rygel, which manages $85 billion. “Despite the fact there’s widespread concerns that rates are going up, there’s still demand coming from individuals looking for income,” while institutions prize their safety and liquidity, said Sarni, who has been buying high-yield company bonds.

(Bloomberg News) Like what you've read?

$3.2 Million Team Comes Back to Securities America

Securities America said early Tuesday that an advisor team led by Wayne Maier has returned to the broker-dealer, after spending the past six years with National Planning Corp.

Maier says that he and the five other reps on his team do more than $3.2 million in yearly fees and commission. They manage about $250 million in client assets and work on $200 million of retirement plan assets, as well, from their Bay City, Mich., office.

“We left because we thought we had unique opportunities at National Planning Corp.,” said Maier in an interview with ThinkAdvisor. “The cultural differences between a Midwest broker-dealer and a California company were something we were not prepared for.”

Maier adds that NPC is “phenomenal” to work with and “did nothing wrong.”  His team “was just not used to the fast-paced culture, so things didn’t mesh well.”

About a year ago, he reached out to Securities America, which was acquired by Ladenburg Thalmann (LTS) in 2011 from Ameriprise (AMP) and has about 1,750 advisors. Maier also discussed his situation and desire to move with several other broker-dealers “to see what was going on in the marketplace.”

Maier also stayed in touch with several executives at Securities America and discussed his plans to make a move with clients.

“We are pleased to have Wayne back, he is a great advisor who takes care of his clients, and he and his staff are consummate professionals,” said Gregg Johnson, senior vice president of branch office development and acquisitions for Securities America, in an interview.

“We think this sends a signal to those reps that have left for various reasons in past … of the value in what we are doing and improvements we continue t to make,” Johnson said. “It’s a strong signal to existing advisors, as well.”

(In June, advisors Shannon Case and Mark Slattery, who had left to affiliate with SII Investments from 2006-2013, came back to Securitiies America.)

Securities America recruited advisors with about $35 million in trailing-12-month fees and commissions last year. This included 320 advisors and staff, helping make 2012 the firm’s fourth best in its past 29 years of recruiting, he says.

Forward Focus

As for this year, the BD is “on pace and cautiously optimistic that we can top last year’s results by 15% to 20% in terms of fees and commissions,” according to Johnson.

A key reason for this boost, he says, is that that Ladenburg Thalmann gives the broker-dealer access to asset management, investment banking, trust services and a fixed-income desk.

“The market sees the quality broker-dealer that Securities America is, and with the stable ownership and what Ladenburg Thalmann brings with it – in terms of additional products and services,” said Johnson. “We have lots of interest and traction in the market.”

Another boost is coming from advisors who feel they may have “outgrown their broker-dealer” and are looking for a partner to give them coaching and other tools to “take them to next level,” the executive notes.

But advisors don’t want a BD that’s “so large or growing to a size that means advisors are not getting same level of attention, care and service they want,” he says.

Johnson, an Iowa native, says that Securities America is indeed proud of its Midwest-based culture, but it is growing on the East and West Coasts, as well.  It’s also proud of the fact that it was one of the first BDs to allow hybrid RIAs to join.

“We have always fostered RIAs," he said. "It goes hand in hand with supporting the passion that advisors have to run their practices as they see fit.”

In July, Securities America teamed with NorthStar Financial Services Group to form Arbor Point Advisors, a joint venture that aims to “fill the gap” for independent advisors looking to operate via a hybrid-business model with a choice of custodial firms and without the need to run their own RIA.

The broker-dealer also hired three regional directors to focus on recruiting in New England, other parts of the Northeast and the Northwest.