Sunday, June 30, 2013

Confused? Bad News Sends the Dow Higher

Ever since the Federal Reserve announced its preliminary plans to exit its quantitative-easing program, investors have changed their previous views that the Fed wouldn't do anything that would allow the economy to slip back into recession. Today, though, some of the old enthusiasm came back into the market after first-quarter GDP was revised from 2.4% down to 1.8%, inspiring confidence that the Fed won't start tapering its bond-buying program as soon as many had feared. With the old "bad news is good news" paradigm seemingly back in effect, the Dow Jones Industrials (DJINDICES: ^DJI  ) has posted a triple-digit gain in early trading, up 106 points at 10:55 a.m. EDT.

Among Dow stocks, Boeing (NYSE: BA  ) has powered the Dow's gains, rising more than 2% after customer British Airways took delivery of its first Dreamliner aircraft. Even with the time frame for Dreamliner deliveries having been derailed by the aircraft's battery problems, airline companies appear to remain committed to the fuel savings and other efficiency benefits that Boeing's newer aircraft offer. With trillions of dollars of new orders expected in the coming 20 years, Boeing only needs to demonstrate its ability to make good on its order backlog in order to reap huge gains.

Some stocks aren't taking part in the rally, though. Alcoa (NYSE: AA  ) is down 1%, suffering along with the commodity-metals markets. Gold and silver have plunged again, hitting three-year lows in the face of perceived pressure from changing central-bank policy. For Alcoa, meanwhile, low commodity prices mean sustained plant closures and capacity underutilization, forcing impatient investors to wait even longer for a long-hoped-for cyclical upturn.

Finally, outside the Dow, for-profit education company Apollo Group (NASDAQ: APOL  ) has sounded alarm bells once more, falling 5.4% after reporting disappointing enrollment figures. New enrollment dropped by nearly a quarter, and investors ignored earnings that topped expectations after accounting for one-time items. Given the regulatory attention that Apollo and its peers have gotten lately regarding their marketing practices and concerns about students' ability to repay student loans, the entire industry seems trapped by pessimism. The fact that Apollo is getting kicked out of the S&P 500 only adds insult to the injury of its plunging stock price in recent years.

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How the iPhone Is Like DisneyLand

While Japan has never been among Apple's (NASDAQ: AAPL  ) most important geographical segments, especially compared with other Asian countries like China. The "Greater China" segment has become so important to the Mac maker's results that it just recently broke it out into a separate reportable segment. Japan was just 7% of revenue last quarter, far below Greater China's 19% contribution.

Source: SEC filings. Calendar quarters shown.

That's not to say that Apple doesn't have opportunities there, but rather that the country isn't at the top of its priority list. Apple has never inked a deal with Japan's largest wireless carrier, NTT DoCoMo (NYSE: DCM  ) , either. The top carrier currently has 61.6 million subscribers. Japan is actually one of the few countries where iOS has Android beat in market share. Kantar Worldpanel Comtech's first-quarter estimates peg iOS at 49.2%, with Android at 45.8%.

In fact, NTT DoCoMo has been aggressively marketing two rival handsets to fend off the iPhone that's offered at smaller carriers Softbank and KDDI. The company is pushing the Samsung Galaxy S4 and Sony Xperia A as its flagship devices.

"I think the iPhone with its own OS is like Disneyland"
In a recent interview with The Wall Street Journal, NTT DoCoMo exec Kazuto Tsubouchi sheds some light on why it has never offered Apple's device.

The exec notes that NTT DoCoMo isn't necessarily averse to selling the iPhone, but rather the benefits may not outweigh the costs. Tsubouchi mentions the "procurement cost" and "obligations" associated with the iPhone, obvious references to the hefty subsidies and minimum purchase commitments that Apple is known for extracting and imposing on carrier partners.

The iPhone would undoubtedly strengthen NTT DoCoMo's device lineup, and some of the carrier's customers want the device, but NTT DoCoMo feels confident that it can hold its own without it. That's because Google (NASDAQ: GOOG  ) Android devices have become much more competitive over the past year, in Tsubouchi's view, which is why the company is focusing so heavily on the platform.

Like most carriers, NTT DoCoMo also prefers to add software customizations to Android, which it can't do on the iPhone. Tsubouchi goes as far as say, "I think the iPhone with its own OS is like Disneyland," describing iOS as a proprietary walled garden. You can buy only Disney products inside Disneyland, according to the simile. NTT DoCoMo wants greater influence.

Softbank and KDDI have been using the iPhone to poach subscribers, and NTT DoCoMo knows it. The carrier considers these customer defections, which could be mitigated by offering the device. If it ever started selling the iPhone, NTT DoCoMo would also have to try to win back those iPhone users by pitching its network, something that Verizon was able to do with some success from AT&T in 2011.

Tsubouchi's comments corroborate other reports that Apple's strict requirements are hindering its ability to expand carrier partnerships. With Android posing a greater competitive threat than ever, carriers also have less need to agree to Apple's terms.

Scoring NTT DoCoMo would certainly be a boon for Apple, but it doesn't look like it's happening anytime soon.

Want to get in on the smartphone phenomenon? Truth be told, one company sits at the crossroads of smartphone technology as we know it. It's not Nokia, or Verizon, or even Apple. 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."

Will Obama's Climate Change Policy Kill Exelon Stock?

The POTUS has spoken: Climate change is real, it's dangerous, and we're going to do stuff to stop it. The president announced his latest climate change policy last week, and big changes are in store for some utilities. Let's look at how Obama's latest might affect Exelon (NYSE: EXC  ) stock.

The facts
Regardless of your (or my, for that matter) opinions on climate change, there are a few facts that unavoidably put utilities at the center of the climate change debate. In 2011, electricity production accounted for 33% of all greenhouse gas emissions, beating out transportation's 28% and industry's 20%. Power plants, specifically, are the source of 40% of all domestic greenhouse gas pollution.


To understand where Exelon stock falls into the mix, our most important metric is generation sources. Although utilities rely on regulated earnings for portions of their profits, the president's new policies promise to seek out the sources, making regulated or unregulated earnings alike cheaper or more expensive -- depending on the source.

Exelon stock's electricity
Currently, Exelon packs more than its fair share of nuclear. At around 19,000 MW, this utility alone produces around 20% of the nation's total nuclear-sourced power. But although Exelon is undoubtedly the nuclear king, utilities can't really "dabble" with this power source. Its capital-intensive nature requires significant investment, and Duke Energy (NYSE: DUK  ) and FirstEnergy (NYSE: FE  ) are two companies that have significant stakes.

Duke Energy's nuclear capacity clocks in at 8,450 MW, or 17% of its total generation. More recently, however, the utility has been backing off nuclear. In February, it announced plans to retire a Florida plant in need of an expensive repair, and in May the company suspended plans to apply for new nuclear sites in North Carolina.

FirstEnergy (NYSE: FE  ) relies on nuclear for 20% of its total generation, churning out 3,990 MW for its smaller-sized company. But unlike Exelon, FirstEnergy also has a massive 64% reliance on coal, another energy source scrutinized by environmental analysts. "Clean coal" seems to be in the clear for emissions-reducing technologies, but traditional power plants could require retirement or expensive modernization.

Does Obama agree with nuclear?
With Exelon's eggs in the nuclear basket, the president's sentiments on this energy source will make or break Exelon stock. Fortunately for Exelon stock owners, the POTUS gave two thumbs up to nuclear.

Obama cites nuclear as one of the clean energy technologies that will "continue to drive American leadership" and will promote its international use through "support for the safe and secure use of nuclear power."

In the 21-page document outlining his policy, the president mentions nuclear energy only eight times -- but eight times is enough. Investors wanted clarity about nuclear's future, and President Obama did that and nothing more. Exelon stock is in the clear, and as natural gas prices continue to rise, nuclear could become an even bigger energy backbone than it already is.

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3 Discounted Stocks On The Verge Of A Huge Rebound

Saturday, June 29, 2013

Raynor: 3 Proven Rules for Long-Term Success

A director at Deloitte Services and coauthor of The Three Rules: How Exceptional Companies Think, Michael Raynor joins the Fool to share his findings about what makes a company successful for the long haul.

In this video segment, Michael explains how the study defined and identified exceptional performance, and what common threads it found running through the outstanding businesses. He and his coauthor were ultimately able to identify what qualities are -- and aren't -- shared by these exceptional companies.

A full transcript follows the video.

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Brendan Byrnes: Could you walk us through some of the metrics that you used specifically, in identifying those? Also, that's very quantitatively focused. What about qualitative aspects? How do you incorporate that? A company's brand, for example, competitive advantage ... intangible assets, how do you incorporate those?

Michael Raynor: Sure. Well, we kept it pretty simple when it came to measuring performance. We focused on profitability, as measured by return on assets.

There are other measures of company performance, of course. No measure captures everything, but if you accept the fact that profitability is an important measure, then we have something potentially useful to say.

We were able to do some statistical analysis on that population of exceptional companies and get a general feel for the financial shape, if you will, of their performance advantage, but then we had to look under the hood.

We did some in-depth, very detailed case studies on the 27 companies in total, 18 of which were exceptional. We had nine trios: a Miracle Worker, a Long Runner, and then what we called an Average Joe -- a company that had average performance, average volatility, average lifespan.

Byrnes: Could you walk us through the three rules that separated these exceptional companies from the pack?

Raynor: Absolutely. It was a bit of a journey to get there, because we originally started out trying to understand the behaviors that made the difference. Was it M&A? Was it diversification? Was it focus? Was it innovation? None of those things were systematically related.

What we landed on were these three rules -- essentially, decision-making principles that were implied by the actions that these companies took, over time. There were three.

The first of them is "Better Before Cheaper." When it comes to how a company creates value for its customers, differentiate yourself based on being better than the competition, not being cheaper than the competition.

But creating value's not enough. You have to capture some for yourself, in the form of profits. There, it's "Revenue Before Cost."

We think that's important, because you can drive profitability any way you want. Math doesn't care, but reality does. Companies that deliver exceptional performance systematically focus on building revenue through either price or volume, and they tend not to have cost advantages, which was a bit of a surprise.

Then finally the third rule, "There Are No Other Rules." The reason we think that's important is that it's really easy to fall into the trap of thinking, "There must be something about leadership. There must be something about culture. There must be something about all these other things that we know matter, but that don't appear to matter in a systematic way."

The third rule says, "Change anything you have to, in order to hew to Rule 1 and Rule 2."

Top 5 Shipping Companies To Invest In Right Now

I get the arguments for and against (NASDAQ: AMZN  ) . I really do. Some see it as a company with a CEO who can't control his spending habits and doesn't like making money. Others see it as an earth-changing company with a leader who has zippy interest in playing Wall Street's little earnings games and sees the business years out in advance. I am the latter.

I'm not just a member
Let's be clear: I own Amazon shares and can't see getting rid of them anytime soon. I consider it an amazing company for so many reasons and Jeff Bezos has won my admiration for being one of the biggest risk takers (Elon Musk is up there, too) in the history of business.

We subscribe to Amazon Prime in my house. And unless something drastic occurs, it's a lock like the sun coming up that we will be Prime members for the rest of my days. There's simply too much value there for me to even consider not renewing. Three months of toilet paper shipping pays for the entire annual subscription, and the rest is just gravy. Two-day shipping, the Kindle lending library, free video streaming, it all adds up to a lot of value. Consumers can chalk it up as a huge win. But is it a win for Amazon? Some say yes; some say no. I say absolutely.

Top 5 Shipping Companies To Invest In Right Now: Celldex Therapeutics Inc(CLDX)

Celldex Therapeutics, Inc., a biopharmaceutical company, focuses on the development, manufacture, and commercialization of novel therapeutics for human health care primarily in the United States. The company markets Rotarix to treat rotavirus infection. Its lead drug candidate, rindopepimut (CDX-110), is an immunotherapeutic vaccine in Phase III clinical trial to target the tumor-specific molecule, epidermal growth factor receptor variant III, as well as in Phase II clinical trial for the indication of recurrent glioblastoma. The company?s other lead drug candidates comprise CDX-011, an antibody-drug conjugate in Phase IIb clinical trial for metastatic breast cancer and melanoma indication; and CDX-1127, a human monoclonal antibody in Phase I clinical trial for the treatment of lymphoma/leukemia and solid tumors. Its additional clinical and preclinical programs consist of CDX-1401, an Antigen Presenting Cells Targeting Technology program in Phase I/II clinical trial to tr eat multiple solid tumors; and CDX-301, an immune cell mobilizing agent and dendritic cell growth factor in Phase I clinical for treating cancer, autoimmune disease, and transplant. The company?s preclinical products include CDX-1135, a molecule for treating renal disease; and CDX-014, a human monoclonal antibody-drug conjugate for the treatment of ovarian and renal cancer. It has research collaboration and license agreements with Medarex, Inc.; Rockefeller University; Duke University Brain Tumor Cancer Center; Ludwig Institute for Cancer Research; Alteris Therapeutics, Inc.; Thomas Jefferson University; 3M Company; University of Southampton; Amgen Inc.; Amgen Fremont; and Seattle Genetics, Inc. Celldex Therapeutics, Inc. was founded in 1983 and is headquartered in Needham, Massachusetts.

Advisors' Opinion:
  • [By Brian Nichols]

    Celldex, is the first, of several companies that focus on immunotherapy treatments to make this list. I am particularly bullish on immunotherapy, because I believe that immunotherapy candidates will become the trend in 2012 with several companies releasing impressive late trial results. I think there are several companies that could be acquired in 2012, and I think that multiple stocks within the immunotherapy scope of treatment will trade with gains of more than 100% in 2012. Therefore, Celldex is the first of many in this category that I expect to post large gains in 2012.

    Celldex is trading with significant optimism, returning a YTD gain of 100%, as investors await data from its clinical trials. The company has two drugs in late stage testing; Rindopepimut & CDX-011. Rindopepimut treats one of the most deadly forms of cancer, Glioblastoma, and has shown encouraging data in early testing. One factor that makes Rindopepimut so appealing is that it's being used to treat both Frontline and Recurrent glioblastoma, and because of the difficulty involved in creating an effective drug to treat glioblastoma investors are extremely optimistic of its potential. CDX-011 treats one of the most common forms of cancer, breast cancer, which has returned very encouraging data as well. I believe the optimism, and positive data surrounding both of the company's lead candidates is enough to entice a solid uptrend in shares of Celldex. And if trials continue to show strong results then this stock could very well become the next multi-billion dollar company in late stage biotechnology with the potential for two blockbuster drugs, which is very exciting for biotechnology investors.

    Biotechnology is a much-diversified industry with companies that treat a variety of diseases and have significant upside potential. My favorite class of drugs is immunotherapy, but as you can see I have listed a variety of companies that treat multiple conditions. I am confident that 2012 will be a year filled with massive ! returns in biotechnology, and the 5 stocks listed above, are just a few that have significant upside potential. I believe that each of the stocks on this list has upside of at least 100% over the next year, from its current valuation, and next week I will release the top 5 that have the greatest upside potential based on growth, speculation, clinical trials, and current valuation.

Top 5 Shipping Companies To Invest In Right Now: Foster Wheeler AG. (FWLT)

Foster Wheeler AG, through its subsidiaries, operates as an engineering and construction contractor; and power generating equipment supplier worldwide. Its Global Engineering and Construction division designs, engineers, and constructs onshore and offshore upstream oil and gas processing facilities; natural gas liquefaction facilities and receiving terminals; gas-to-liquids facilities; and oil refining, chemical and petrochemical, pharmaceutical, and biotechnology facilities, as well as related infrastructure, including power generation, distribution, gasification, and processing facilities for metals and mining sector. This division also designs carbon capture and storage, and solid fuel-fired integrated gasification combined-cycle power plants, as well as coal-to-liquids, coal-to-chemicals, and biofuels facilities; and operates power generation facilities, such as conventional and renewable source, and waste-to-energy facilities. In addition, it offers project and constr uction management services, including procurement of equipment, materials, and services from third-party suppliers and contractors; provides environmental remediation services; and designs and supplies direct-fired furnaces comprising fired heaters and waste heat recovery generators used in refinery, chemical, petrochemical, and oil and gas processes. The company�s Global Power division designs, manufactures, and erects steam generators and auxiliary equipment, including surface condensers, feedwater heaters, coal pulverizers, steam generator coils and panels, biomass gasifiers, and replacement parts; nitrogen-oxide reduction systems and components; and flue gas desulfurization equipment for steam generators. It also offers various site services; conducts research and development in combustion, fluid and gas dynamics, heat transfer, materials, and solid mechanics areas; and licenses technology to other steam generator suppliers. The company was founded in 1894 and is based in Geneva, Switzerland.

Top Casino Stocks For 2014: ARM Holdings PLC (ARMH)

ARM Holdings plc (ARM), incorporated on October 16, 1990, designs microprocessors, physical intellectual property (IP) and related technology and software, and sells development tools. As of December 31, 2012, the Company operated in three business segments: the Processor Division (PD), the Physical IP Division (PIPD) and the System Design Division (SDD). ARM licenses and sells its technology and products to international electronics companies, which in turn manufacture, markets and sells microprocessors, application-specific integrated circuits (ASICs) and application-specific standard processors (ASSPs) based on ARM�� technology to systems companies for incorporation into a range of end products. It also licenses and sells development tools directly to systems companies and provides support services to its licensees, systems companies and other systems designers.

ARM processor architecture and physical IP is used in embedded microprocessor applications, including cellular phones, digital televisions, mobile computers and personal computer peripherals, smart cards and microcontrollers. ARM�� principal geographic markets are Europe, the United States and Asia Pacific. ARM�� product offering includes microprocessor Cores: RISC microprocessor cores, including specific functions, such as video and graphics IP and on-chip fabric IP; embedded software; physical IP; development tools, and support and maintenance services.

Processor Division

The PD encompasses those resources that are centered on microprocessor cores, including specific functions, such as graphics IP, fabric IP, embedded software IP and configurable digital signal processing (DSP) IP. Service revenues consist of design consulting services and revenues from support, maintenance and training.

Physical IP Division

The PIPD is focused on building blocks for translation of a circuit design into actual silicon. During the year ended December 31, 2012, the Company�� total av! erage PIPD headcount was 557. ARM is a provider of physical IP components for the design and manufacture of integrated circuits, including systems-on-chip (SoCs). ARM Artisan physical IP products include embedded memory, standard cell and input/output components. Artisan physical IP also includes a limited portfolio of analog and mixed-signal products. ARM�� physical IP components are developed for a range of process geometries ranging from 20 nanometer - 250 nanometer. ARM licenses its products to customers for the design and manufacture of integrated circuits used in complex, high-volume applications, such as portable computing devices, communication systems, cellular phones, microcontrollers, consumer multimedia products, automotive electronics, personal computers and workstations and many others.

ARM�� embedded memory components include random access memories, read only memories and register files. These memories are provided in the form of a configurable memory compiler, which allows the customer to generate the appropriate configuration for the given application. ARM�� memory components include many configurable features, such as power-down modes, low-voltage data retention and fully static operation, as well as different transistor options to trade off performance and power. In addition, ARM�� memory components include built-in test interfaces that support the industry test methodologies and tools. ARM memory components also offer redundant storage elements.

ARM�� memory components are designed to enable the chip designer maximum flexibility to achieve the optimum power, performance, and density trade-off. ARM offers standard cell components that are optimized for high performance, high density or ultra high density. ARM logic products deliver optimal performance, power and area when building ARM Processors, Graphics, Video and Fabric IP along with general SoC subsystem implementation. ARM delivers physical interface for a range of DDR SDRAM (double-data rate s! ynchronou! s dynamic random-access memory) applications ranging from mission critical applications to low-power memory sub-systems. Silicon on Insulator (SOI) products is an alternative methodology to traditional semiconductor fabrication techniques.

System Design Division

The SDD is focused on the tools and models used to create and debug software and system-on-chip (SoC) designs. ARM�� software development tools help a software design engineer deliver products right the first time. Engineers use these tools in the design and deployment of code, from applications running on open operating systems right through to low-level firmware. The ARM Development Studio is a hardware components that allow the software designer to connect to a real target system and control the system for the purposes of finding errors in the software. The ARM DSTREAM unit allows the software developer to control the software running on the prototype product and examine the internal state of the prototype product. ARM Development Boards are ideal systems for prototyping ARM-based products. The ARM Microcontroller Development Kit supports ARM-based microcontrollers and 8051-based microcontrollers from companies, such as Analog Devices, Atmel, Freescale, Fujitsu, NXP, Samsung, Sharp, STMicroelectronics, Texas Instruments and Toshiba. The ARM Microcontroller Development Kit is used by developers who are building products and writing software using standard off-the-shelf microcontrollers.

The ARM Microprocessor Families

ARM architecture processors offers a range of performance options in the ARM7 family, ARM9 family, ARM11 family, ARM Cortex family and ARM SecurCore family. The ARM architecture gives systems designers a choice of processor cores at different performance/price points. The ARM7 offers 32-bit architecture capable of operating from 8/16-bit memory on an 8/16-bit bus through the implementation of the Thumb instruction set. The ARM9 family consists of a range of microprocessors in ! the 150-2! 50MHz range. Each processor has been designed for a specific application or function, such as an application processor for a feature phone or running a wireless fidelity (WiFi) protocol stack. The ARM9 family consists of a range of microprocessors in the 150-250 megahertz range. The ARM11 family consists of a range of microprocessors in the 300-600 megahertz range. ARM Cortex family is ARM�� family of processor cores based on version 7 of the ARM Architecture. The family is split into three series: A Series, A Series and M Series.

Top 5 Shipping Companies To Invest In Right Now: Bank Of Montreal (BMO)

Bank of Montreal, together with its subsidiaries, provides a range of retail banking, wealth management, and investment banking products and solutions in North America and internationally. It offers personal banking products and services to consumers and small businesses, including deposit and investment services, mortgages, consumer credit, small business lending, and other banking services; and commercial banking products and services to small business, medium-sized enterprise, and mid-market banking clients comprising lending, deposits, treasury management, and risk management services. The company also offers cards and payments services; investment and wealth advisory services; self-directed investing services; private banking services to high net worth and ultra-high net worth clients; investment fund solutions across a range of channels; pension plans; investment management services; and creditor insurance, and life insurance and annuity products and services. In add ition, it provides capital markets products and services, including equity and debt underwriting, corporate lending and project financing, mergers and acquisitions, restructurings and recapitalizations, balance sheet management, liquidity management, merchant banking, securitization, foreign exchange, derivatives, debt and equity research, and institutional sales and trading to corporate, institutional, and government clients. As of October 31, 2010, Bank of Montreal operated and maintained approximately 1,230 bank branches in Canada and the United States. The company was founded in 1817 and is headquartered in Toronto, Canada.

Advisors' Opinion:
  • [By Andrew]

    This is another solid Canadian bank paying a whopping 4.70% dividend.  My arguments for buying this bank are pretty much the same as above for TD.

Top 5 Shipping Companies To Invest In Right Now: Gwr Resources Inc. (GWQ.V)

GWR Resources Inc., a junior exploration company, engages in the acquisition, exploration, and development of mineral properties in Canada. The company explores gold, copper, and magnetite properties. Its principal property includes the Lac La Hache porphyry copper-gold-silver/skarn copper-magnetite-gold-silver property located in the Quesnel Trough in British Columbia. The company was incorporated in 1987 and is based in Lac La Hache, Canada.

1 Industry Seriously at Risk If This Country's Growth Falters

Coal is far from a favorite fuel these days, despite its abundance. No matter how much we scrub it, we simply can't make it turn green. That being said, the world still uses a whole lot of coal. In fact, over the past 10 years, coal consumption has grown by an average of 4.4% annually, making it the fastest-growing fossil fuel.

According to BP's "Statistical Review of World Energy 2013," last year China accounted for 50.2% of global coal consumption. Overall, the Middle Kingdom used 1,873.3 million tonnes oil equivalent of coal. For perspective, the U.S. used 437.8 million tonnes oil equivalent last year, which was just 11.7% of the world's total and a drop of 11.9% year over year. Both countries are larger coal customers than Santa Claus, as it's estimated that the big guy gives out only about 10,000 tons of coal each year to children who misbehave. 

Going back to China's dominance of the coal market, last year its consumption grew by 6.1%, while demand across the rest of the world declined by 4.2%. That meant China accounted for all of the net growth in global coal consumption last year. That means the coal industry is seriously at risk if China's growth slows down, which is why investors need to watch it very closely.

Many coal producers have pegged their hopes on coal's international growth. Peabody Energy (NYSE: BTU  ) for example, purchased coal operations in Australia a couple of years ago to better position the company to take advantage of demand growth in the region. Further, the company, along with peers including Arch Coal (NYSE: ACI  ) , have inked coal export agreements with Kinder Morgan Partners (NYSE: KMP  ) to get U.S.-produced coal to the global marketplace.

Source: Peabody Energy (Coal export terminal in Australia).

Exports have been important for Arch, which set a record last year with 13.6 million tons of coal exported, nearly double the 7 million tons it exported in 2011. The company hopes that new export terminals from Kinder Morgan will help it increase its exports fourfold by 2020. Overall, exports contributed well over $10 billion in revenue to U.S.-based coal companies.

That being said, increasing export capacity hasn't been easy, as Kinder Morgan recently had to drop plans to build an export terminal in the Pacific Northwest, because of opposition from environmental groups. That, however, hasn't stopped the midstream giant from spending more than $400 million to expand its coal export terminals elsewhere. In addition to building coal export terminals, Kinder Morgan recently announced that it will purchase its own coal reserves, which it will lease to producers and collect royalties. It's a move that could backfire if Chinese demand slows down.

Other companies that could be pinched if China begins to wean itself off coal are global mining giants BHP Billiton (NYSE: BHP  ) and Rio Tinto (NYSE: RIO  ) . Both have coal operations in Australia that are strategically positioned to benefit from Chinese demand growth. BHP is being particularly cautious on coal, as it's not investing in any new coal projects while cutting about $800 million in overall costs in its coal business. Meanwhile, Rio Tinto is looking to divest upwards of $3 billion in coal assets in a move to rid itself of some of its smaller and less-profitable assets.

China's appetite for coal really is the cornerstone of the industry right now. However, hopes within the country are that it will be the largest producer of renewable energy one day. Not only that, but it has massive untapped shale oil and gas reserves, which could help it balance its energy demands. That's why coal investors need to watch to see if demand growth slows, because it could be the canary in the coal mine to warn investors that coal's biggest customer is about to slow its spending, which could really affect producer profits.

The 1 Trend Banks Can't Afford to Ignore

Banks are naturally skeptical of change, and they were slow to adapt to the Internet age in the 1990s and 2000s. But with the explosion of smartphones and mobile technology, now is the time for banks to double down on mobile banking.

And if they do, banks will have a profit center in the pocket of every mobile customer across the world. 

The Internet is changing
According to Mary Meeker of the venture capital firm Kleiner Perkins Caufield and Byers, 78% of Americans today are on the Internet -- which gives banks approximately 244 million potential online customers. But as Meeker explains, the Internet is currently undergoing a sea change. Since 2009 mobile use has been multiplying 1.5 times per year; today, mobile use constitutes 15% of total Internet traffic.

The Internet is going mobile. Banks, therefore, must be prepared to compete and win in this new, mobile marketplace.

How do the banks stack up?
Wells Fargo (NYSE: WFC  ) and JPMorgan Chase (NYSE: JPM  ) are good representations of the industry at large. Both banks reported a 32% increase in active mobile customers year over year. Both banks mention mobile in their investor presentations and reporting, but the reports leave me feeling that mobile is not a major focus for them. The growth trends in mobile customers more likely result from the broader trend, and do not reflect innovative products at either bank.

In contrast, Bank of America (NYSE: BAC  ) has embraced the trend to mobile banking, repeatedly mentioning mobile when it discusses consumer strategy. The bank reports that more than $9.3 million in deposits were processed via smartphone camera in Q1, a 36% increase over Q4 2012. The renewed focus is helping boost Bank of America in mobile banking, with 30% year-over-year growth in mobile users. That acceleration, based on the momentum shown in Meeker's presentation, is likely to continue.

BofI Holding's  (NASDAQ: BOFI  )  subsidiary, Bank of the Internet, is a $2.8 billion online-only bank and an excellent case study in the benefits of engaging customers primarily online. Without a large branch network, the bank is able to produce a stellar efficiency ratio -- a measure of non-interest expenses to revenue -- of just 36.3% as of March 31, 2013. And, most importantly, the bank is viable as a business; it has been in operation for 12 years, has 40,000 customers with either a loan or deposit account, is profitable, and grew its loan portfolio by 37% year over year as of March 31, 2013. For larger national banks, Bank of the Internet is a proof of concept: Financial services can profitably exist online.

The only thing constant is change
For banks, the mobile web is a trend that cannot be ignored. Consumers clearly demand access to financial services on the go. Now it's up to the banks to meet that expectation.

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Friday, June 28, 2013

The Second U.S. Housing Bubble Inflates: Month 10

In May 2013, the trailing twelve month average of median new home sale prices in the U.S. continued to inflate, reaching an initial value of $253,033. This marks the fourth consecutive month in which a new record has been set for this particular statistic, which has risen by $2,058 from the previous month's figure.

Meanwhile, the trailing twelve month average of median household income for May 2013 has come in at $51,351, rising by $50 from the figure recorded in April 2013. This value is still short of the record of $51,444 set for this statistic in December 2008, just before the large scale losses of high paying jobs in the U.S. automotive industry took place. [Prior to December 2008, job losses for the recession starting in December 2007 were concentrated among positions that were typically held by young adults and teenagers, where increases in the federal minimum wage in 2007 and 2008 were primarily responsible for the seemingly permanent elimination of hundreds of thousands of these low-income earning positions.]

Our chart below shows the trend for the non-inflation adjusted twelve-month trailing averages of both median new home sale prices and median household income for each month since December 2000:

(click to enlarge)

With the latest update to its Excel spreadsheet detailing median new home sale prices, the U.S. Census has revised its figures for a number of previous months upward. With that updated data, we find that since the second U.S. housing bubble began to inflate in July 2012, the median sale price of new homes has increased on average by about $23 for every $1 increase in median household income. This represents a faster average pace of growth than was recorded during the inflation phase of the first U.S. housing bubble.

The Spark for Inflating the New Housing Bubble

As with the ! first U.S. housing bubble, which sparked off its inflation phase back in November 2001, the proximate cause of the second U.S. housing bubble is nearly identical: a sudden and very large influx of money flowing into the U.S. housing from the sale of investments in other markets.

In 2001, the dominant source of those funds came from the sale of stocks, whose prices had been originally bid up during the inflation phase of the Dot-Com Bubble from April 1997 to August 2000, which investors first mostly held and then began to sell off in great quantities in 2001. In 2012, the dominant source of funds flowing into the U.S. housing market came from hedge funds and real estate investment firms, such as the Blackstone Group, which made a strategic decision enter into the residential real estate market using the proceeds it was accumulating from the sales of their previous investments in corporate real estate after good opportunities in that market began to become hard to find.

The influx of these funds into residential real estate markets led to the depletion of the available inventory of homes to historically low levels in many of these markets, which in turn, led to sharp increases in U.S. new home sale prices compared to more sustainable growth rates, both in 2001 and in 2012, even though investors in both 2001 and in 2012 were primarily focused on acquiring existing homes, and distressed properties in particular in 2012.

That's because new homes are, virtually by definition, at the margin for all real estate markets. Their prices are therefore especially sensitive to changes in the levels of both supply and demand in the overall market.

And that's another reason why our method of tracking median new home sale prices with respect to median household income is so effective at detecting the inflation or deflation of potential bubbles in housing markets in their earliest phases. If we see median new home sale prices racing far ahead of median household income, it's a pretty clear indicati! on that s! omething has upset the established equilibrium within the U.S. housing market.

Speaking of which, we'll close with an updated version of our chart showing the long-term view of what established equilibriums for median new home sale prices really look like in the United States:

(click to enlarge)

Since 1967, median new home sale prices in the U.S. have typically increased by anywhere from $3.34 to $4.07 for every $1 increase in median household income in the absence of any periods of bubble inflation or deflation in U.S. housing markets.


Sentier Research. Household Income Trends: May 2013. [PDF Document]. Accessed 26 May 2013. [Readers should note that we have converted all older inflation-adjusted values presented in this source to be in terms of their original, nominal values (a.k.a. "current U.S. dollars") for use in our charts, which means that we have a true apples-to-apples basis for pairing this data with the median new home sale price data reported by the U.S. Census Bureau.]

U.S. Census Bureau. Median and Average Sales Prices of New Homes Sold in the United States. [Excel Spreadsheet]. Accessed 28 May 2013.

Source: The Second U.S. Housing Bubble Inflates: Month 10

The Limited Stock With Unlimited Potential

Retail is a fickle place for investors, where fashions go in and out of favor in quick succession. But for those who are comfortable with the ups and downs of the industry, owning what used to be The Limited stock -- the company recently changed its corporate name from Limited Brands to L Brands (NYSE: LTD  ) -- has been a long-term winning strategy, with the stock having posted strong returns both since the financial crisis in 2009, and over the past two decades. Let's take a closer look at what's happened with L Brands, in general, and with The Limited, in particular, recently.

What's behind shares of L Brands?
The key thing to realize is that L Brands no longer owns The Limited. In 2010, L Brands sold The Limited to the private equity company Sun Capital Partners, with Sun taking control of the then-struggling 200-plus-store chain. Sun still owns The Limited, with the chain having grown to 257 locations in the U.S. as of April.

What's amazing in hindsight is how long it took for L Brands to jettison the word "Limited" from its name. Now, the company's main assets are its Victoria's Secret and Bath & Body Works stores, with other companies like the White Barn Candle brand and Canada's La Senza playing a secondary role, and bringing in just 10% to 15% of L Brands' total revenue.

How has L Brands fared?
Lately, L Brands has done a good job of keeping sales moving upward. In May, the company recorded 3% gains in same-store sales, overcoming the headwinds that some other retailers faced in what was a relatively cold spring. With a stranglehold in the intimate apparel market, Victoria's Secret gives L Brands almost unlimited potential, both from store sales as well as catalog offerings.

But rivals have seen the value of the lingerie business and are taking aim at Victoria's Secret's success. American Eagle Outfitters (NYSE: AEO  ) has had substantial success with its Aerie lingerie brand, which has helped keep American Eagle's overall results relatively strong. Moreover, Aerie has done what L Brands hasn't been able to do: post strong success in its Internet-based sales.

Another up-and-coming competitor is Juicy Couture, a brand of Fifth and Pacific (NYSE: FNP  ) , which plans to launch a new line of intimate apparel early next year. For Fifth and Pacific, getting Juicy Couture to perform better would mark the final step in its overall turnaround, with the company's other two major brands having already seen gains in comps recently.

What's ahead for L Brands?
Perhaps the biggest challenge for the company will be to choose a permanent name. Having taken so long to jettison the out-of-date impression of still being The Limited stock, L Brands is still a complete misnomer, given that neither of its major brands has an L anywhere in their names. As silly as it sounds, if management can't move more quickly on something as simple as a corporate name, how well can it fare with more crucial business decisions?

One thing is certain: Shares of L Brands won't go back to being called The Limited stock anytime soon, barring an unlikely reacquisition of the old Limited stores. Given the potential within Victoria's Secret, that's not a bad thing, as the upside for shareholders is almost unlimited if the company can improve its execution, and make the most of its strong brand reputation.

The retail space is in the midst of the biggest paradigm shift since mail order took off at the turn of last century. Only those most forward-looking and capable companies will survive, and they'll handsomely reward those investors who understand the landscape. You can read about the 3 Companies Ready to Rule Retail in The Motley Fool's special report. Uncovering these top picks is free today; just click here to read more.

Click here to add L Brands to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Wells Fargo Got Some Good News -- so Why Is It Drooping?

The market crazies aren't over yet, it seems. After finishing up rather nicely yesterday, big banks Wells Fargo (NYSE: WFC  ) , Bank of America (NYSE: BAC  ) , and Citigroup (NYSE: C  ) are all dropping early this Friday morning, along with just about everything else, including the Dow and the S&P 500.

Why so glum?
While the overall market blahs are likely to blame for Wells Fargo's decline, it's still a bit disappointing. The bank was on an upward trajectory all week, ending each day higher despite the continued roiling in the markets. In addition, Wells and compatriot Bank of America had some good news yesterday, which I would have expected to buoy each banks' share price today.

Bloomberg reported late yesterday that Wells and B of A will not be facing another lawsuit from the New York Attorney General's Office regarding mortgage servicing concerns, after all. Last month, AG Eric Schneiderman announced his intent to sue over alleged breaches by the two banks in the terms of the $26 billion foreclosure settlement. Bank of America immediately told him that he had no right to do so, citing terms in the settlement stipulating that the banks should be given the right to cure any problems before enforcement action could be taken.

As it turns out, B of A was right. A committee that oversees the terms of the settlement noted that all banks that signed the agreement -- which include JPMorgan Chase (NYSE: JPM  ) and Citi, though those two weren't named in the action planned by Schneiderman -- must be given a chance to fix problems according to the terms of the settlement. Good news, indeed, but it is not being reflected in Wells' share price this morning.

Still, it is early yet, and the market may cheer up before too long. Fewer lawsuits in the offing is always good news for big bank investors, who may reward Wells after the good news sinks in. For now, though, things are looking glum.

There is obviously still some volatility in the markets, which may not subside today. As Foolish investors well know, a snapshot look at any given stock, taken in isolation, can be detrimental to the long-term view. The big picture, as always, is what really matters, and the normal ups and downs of the market are something that investors with their eyes on the prize take into consideration, knowing that these hills and valleys don't mean much of anything on their own, and are just part and parcel of the business of intelligent, long-term investing.

Many investors are terrified about investing in big banking stocks after the crash, but the sector has one notable stand-out. In a sea of mismanaged and dangerous peers, it rises above as "The Only Big Bank Built to Last." You can uncover the top pick that Warren Buffett loves in The Motley Fool's new report. It's free, so click here to access it now.

This Revolutionary Plane Needs to Get Bigger to Compete

At last week's Paris Air Show, Airbus, Boeing (NYSE: BA  ) , and Embraer (NYSE: ERJ  ) each sold billions of dollars of commercial airplanes to airlines and leasing companies looking to take advantage of new fuel-saving technologies. The highest-profile aircraft this year were Boeing's 787 Dreamliner (the largest version of which officially launched at the air show), Airbus's A350 (which achieved its first flight earlier this month), and the second-generation of Embraer's popular E-Jets (which also launched at the air show).

All of these new aircraft -- but especially the Boeing and Airbus offerings -- make heavy use of lightweight composite materials. By reducing the weight of the aircraft, these materials improve range, payload, and fuel efficiency.

Yet there is a fourth major competitor in the commercial aircraft market -- Bombardier (NASDAQOTH: BDRAF  ) -- and it has its own advanced-technology airplane. The company's CSeries plane is expected to make its first flight as early as this week. Yet the CSeries put up a goose egg at the Paris Air Show, failing to notch a single order. While Bombardier has nearly 200 firm orders for the CSeries, the company will rapidly burn through that backlog once it starts CSeries mass production.

Bombardier's CS100 jet (photo courtesy of Bombardier)

Bombardier claims that the CSeries will offer 15% lower cash operating costs than competing aircraft, due to its advanced technology. Whereas Airbus and Boeing made heavy use of composite materials for their new widebodies (the 787 and A350), only Bombardier is doing the same in the narrowbody market. So with order backlogs at Boeing, Airbus, and Embraer swelling, why is Bombardier's CSeries falling flat? One reason may be its awkward "in-between" size; it is small for a mainline jet, but larger than regional jets. Adding a larger model would greatly increase the CSeries' competitiveness, and could lead to significantly more orders.

Commonality is key
The CSeries will primarily compete with Embraer's E-Jets, Boeing's 737 family, and Airbus' A320 family. All three of these aircraft families have current-production models that will be superseded by new versions later this decade. Bombardier opted for a "clean sheet" design to maximize performance, whereas all three competitors are updating current models with new engines and wings while minimizing other changes.

A significant problem for Bombardier is that while its design may have a performance advantage relative to competitors, most airlines like to keep their fleets as simple as possible. The new Airbus, Boeing, and Embraer models will all maintain "commonality" with the current generation aircraft. Airlines currently operating Boeing 737 Next Generation aircraft will not need to retrain pilots to fly Boeing 737 MAX planes when they arrive.

Furthermore, while the smallest versions of the Airbus and Boeing families go head-to-head with the CSeries, Bombardier does not offer a plane that competes with larger variants of the Boeing 737 and Airbus A320 families. Whereas the largest CSeries plane has a maximum capacity of 160 passengers, the Airbus A320 seats up to 180 and the A321 has a maximum capacity of 220. Similarly, the Boeing 737-800 seats up to 189 passengers and the 737-900ER maxes out at 220.

This means that Airbus and Boeing customers can order different-sized aircraft that use the same technology, simplifying crew scheduling and maintenance, while allowing the airlines to match capacity to demand on various routes. Recently, the most popular models have tended to be the larger ones, as they offer lower unit costs. The models comparable in size to the two CSeries models have seen weak demand recently.

Time to move up
While Bombardier has constantly dismissed speculation that it will offer a stretched version of the CSeries soon, it looks like this may be the company's best bet. CSeries jets may offer lower costs than directly competing models like the 737-700 and the A319, but airlines increasingly prefer the larger 737-800/900-ER and A320/A321 models anyway. As long as airlines are buying large narrowbodies from Boeing and Airbus, they will usually prefer to stay within the same family for small to medium size narrowbodies, due to the advantages of commonality.

By stretching the CSeries to compete directly with the 737-800 and A320, Bombardier could enter the highest-volume segment of the narrowbody market while also enhancing the appeal of the smaller CSeries models. Airlines that today are choosing Boeing and Airbus over Bombardier due to the benefits of commonality might find the CSeries more appealing if it would cover most or all of their narrowbody needs.

Foolish bottom line
Bombardier has stated that it expects to sell thousands of CSeries aircraft over the next 20 years. To do that, it probably needs to offer a larger version of the plane. Right now, Bombardier is stuck in the smallest and lowest-volume segments of the narrowbody market. Even if the CSeries objectively outperforms competing aircraft from Boeing, Airbus, and Embraer, it suffers from the disadvantage that it is the only "all-new" design, which increases training costs and complexity.

By offering a larger CSeries, Bombardier would be able to cover more of the narrowbody market, gaining some of the benefits of commonality for itself. Airlines might be more willing to add an unfamiliar aircraft type to their fleets if it covered a larger proportion of their aircraft needs. If Bombardier wants to compete with Boeing and Airbus, it needs to go all the way!

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Is It Finally Time To Buy This 'Perfect' Business?

Take a moment to try to imagine the perfect business.

It wouldn't have any of the worries or costs associated with inventory. The business would be able to profit from any product or service in the world without actually having to spend the time and money required to operate the particular business. This business would create incredible value for consumers by providing the lowest prices available for whatever happens to strike a consumer's fancy.

In addition, it would create a win-win situation for other businesses by guiding a stream of customers to their front door. Its products and services would have close to zero cost, creating nearly pure profit from each sale. Finally, the company would use the Internet to reach a worldwide client base at minimal expense.

There is no need to imagine this perfect business. It actually exists.

This theoretically perfect company is the much maligned Groupon (Nasdaq: GRPN).


Launching as the one of the most hyped IPOs in history, this daily-deals site has done nothing but smash the dreams of investors from its first days as a public company. Despite exponential growth from 400 clients in 2008 to a present 150 million, the company is down nearly 80% from its highs. Groupon is trading at around 27 times next year's estimated earnings.

My purpose is not to rehash what happened or provide "woulda, shoulda, coulda" hindsight analysis of Groupon's missteps. I'll leave that to the pundits and armchair quarterbacks. Rather, I want to build a case that Groupon is a potentially profitable long-term investment.

Groupon has a market cap of over $5 billion, revenue of more than $2 billion with year-over-year quarterly revenue growth of 7.5%. I am fond of following the big-money players, and Groupon does not disappoint with institutional interest. Thirty-six percent of the company is held by insiders, and nearly 64% remains institutionally held. Venture capital firm New Enterprise Associates maintains more than 87 million shares; Tiger Global Management holds another 65 million.

In fact, over the past quarter, JANA Partners, Slate Path Capital, Miura Global Management and Capital Tactics Advisors have all increased their holdings in Groupon.

Here are three additional reasons I am bullish on Groupon.

1. Deutsche Bank Upgrade
An analyst at Deutsche Bank (NYSE: DB) just upgraded shares of the company from "hold" to "buy" and increased the price target to $10. In addition, the analyst expects Groupon's billings to grow by 20% this quarter.

2. Improved Marketing Strategies
Two types of direct marketing include pull marketing and push marketing. Groupon was focused primarily on push marketing. This is when the company sends out emails with the goal of reaching consumers who might be interested in its partners' products or services.

Pull marketing, on the other hand, is the goal of attracting customers to the Groupon site to search for a variety of local deals. In its most recent quarter, 45% of the company's North American business came from smartphone and tablet users, and its mobile apps were downloaded more than 7 million times. While sophisticated spam filters may block push email marketing attempts for many users, pull marketing through the website and mobile apps avoids this issue.

In addition, consumers are more likely to purchase several Groupon deals when browsing the website or app rather than just the one featured in the email blast.

3. Share Momentum
Groupon's stock has been in an uptrend since November: The price is up more than 100% from its sub-$3 November lows. It has broken above both the 50- and 200-day simple moving average resistance levels. The uptrend, now 8 months old, shows no technical signs of ending.

Risks to Consider: Groupon faces several factors acting as headwinds. The first is consumer "deal fatigue," which means customers aren't loyal to Groupon and will switch to another deal provider at the drop of a hat. Secondly, deep-pocketed competition springing up from companies like Google (Nasdaq: GOOG) is certain to take customers away from Groupon. Last, many businesses have discovered that more than a few Groupon clients are purely deal-driven and will not return to purchase items at regular prices, resulting in non-repeat business for Groupon.

Action to Take --> I like Groupon on a breakout close above $8. If the uptrend continues, then shares could rise to $15 within the next 12 months.

P.S. -- Google could be a formidable competitor with Groupon in the daily-deals game. In fact, my colleague Elliott Gue is so sure about Google's prospects that he's named it one of his Top 10 Stocks for 2013. Which other companies make the cut as his Top 10 Stocks? To find out, click here.

Thursday, June 27, 2013

Gold Is Finished -- Get Over It

Why MannKind Is Poised to Pull Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, biopharmaceutical company MannKind (NASDAQ: MNKD  ) has received a distressing two-star ranking.

With that in mind, let's take a closer look at MannKind and see what CAPS investors are saying about the stock right now.

MannKind facts

Headquarters (founded)

Valencia, Calif. (1991)

Market Cap

$2.1 billion



Trailing-12-Month Revenue

$35 thousand


Founder/Chairman/CEO Alfred Mann

President/COO Hakan Edstrom

Return on Equity (average, past 3 years)



$28.0 million / $332.0 million


Eli Lilly
Novo Nordisk

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 16% of the 695 members who have rated MannKind believe the stock will underperform the S&P 500 going forward.

Just yesterday, one of those Fools, All-Star zzlangerhans, tapped the stock's recent surge as particularly unsustainable:

At the end of last year I looked over all the stocks in my biopharma database and tried to predict which would be the biggest runner of 2013. My conclusion? Mannkind. But I never bought in or even green thumbed because the run started earlier than I expected and I kept waiting for a pullback that never came. ... And after the company solidified their guidance to topline results of Affinity 1 and Affinity 2 in mid August, the stock went parabolic. The moral: don't be so obsessed with catching a stock at the absolute bottom. ...

Now I'm left with another crummy red thumb. I don't think Mannkind is worth two billion even if the Affinity trials are a resounding success and Afrezza is approved the next time round. I've been a long-term bear on MannKind for years and my reasons are well-documented here. A 300% rise in share price this year is completely unjustified and simply represents traders playing the "greater fool" game. I'm terrible at judging when that game will end but at some inflection point, whether it is positive data or drug approval, this stub is going to tank.

While you can certainly make quick gains in hot biotech plays, the best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.

Wednesday, June 26, 2013

Smile! Apple Wants You to Share Your Picture

Over the past several years, Facebook (NASDAQ: FB  ) , Twitter, and more recently Google (NASDAQ: GOOG  ) have shown that photo sharing is big business and a critical driver of social media and online activity. Just recently, Instagram announced the introduction of videos, and Google is ramping up its offering to compete with Facebook and Twitter. Now Apple (NASDAQ: AAPL  ) is finally making some improvements to its camera app in hopes of getting into this segment of technology.

In the video below, Fool contributor Doug Ehrman discusses some of the recent developments in photo sharing and how Apple hopes to become more involved in this arena.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.

Stocks Make Big Gains for All the Wrong Reasons

U.S. stock markets are up again today thanks to the promise of stability in China. Monday's fears of skyrocketing interest rates have been eased by four straight days of falling rates in China and promises from government officials that there won't be a liquidity crisis. Investors are looking past bad news in the U.S., where the Department of Commerce said first-quarter GDP growth was only 1.8% -- significantly lower than the previous estimate of 2.4%. As of 3:20 p.m. EDT, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) has gained 1.15%, while the S&P 500 (SNPINDEX: ^GSPC  ) is up 1.14%.

Boeing (NYSE: BA  ) is among the companies leading the charge, rising 2.3% today. Competitor Bombardier delayed a flight of its CSeries jet for the second time, this time pushing the test back until July. Bombardier is targeting the market dominated by Boeing's 737, so the delays, along with Bombardier's failure to notch any orders at the Paris Air Show, are good for Boeing. Boeing will report earnings on July 24, and investors will likely get more information about the impact of delayed orders for the 787 Dreamliner.  

Alcoa (NYSE: AA  ) is the lone big loser on the Dow today, falling 2.3%. Slower-than-expected GDP growth has had many effects on trading today, and they all seem to be bad for Alcoa. If the economy doesn't grow quickly enough, the Fed may keep its easy-money policies in place, which may have investors excited today but is not necessarily good for Alcoa: The company benefits more from a growing economy than from easy money.

The stock market has become something of a logic vacuum lately, cheering stimulus and booing the Fed's bullish predictions last week. Long-term investors should be hoping for stronger growth and fewer stimuli. It's a good thing earnings season is around the corner: Perhaps stocks will begin to trade based on fundamentals, rather than macroeconomic speculation.

Looking at NeuStar's Analytics Platform

You may not have heard of NeuStar (NYSE: NSR  ) , but the services it provides can affect you greatly. This $3 billion company is also handily beating the market as it shifts its focus to move deeper into the information and analytics industry.

NeuStar started its life as an operating unit within Lockheed Martin, and won its original contract to provide local telephone number portability services in 1996. It's kept that job and performed other services along the way, including administering the registry for the .biz and .us Internet domain names.

After spinning off from Lockheed and scoring years of success, NeuStar began to shift its focus to information and data analytics services under CEO Lisa Hook. That led to the acquisition of TARGUSinfo in 2011.

Our roving reporter Rex Moore attended June's big Cable Show in Washington, D.C., and asked NeuStar's Thomas Flaherty about the company's data analytics platform.

Meanwhile, the amount of data we store every year is growing by a mind-boggling 60% annually! To make sense of this trend and pick out a winner, The Motley Fool has compiled a new report called "The Only Stock You Need to Profit From the NEW Technology Revolution." The report highlights a company that has gained 300% since first recommended by Fool analysts but still has plenty of room left to run. To get instant access to the name of this company transforming the IT industry, click here -- it's free.

10 Best Gas Stocks To Buy For 2014

European (SXXP) stocks climbed as mining shares rallied and Alcoa Inc. began the U.S. earnings season with profit that beat analysts��estimates.

BHP Billiton Ltd. (BHP) and Rio Tinto Group, the world�� largest mining companies, advanced at least 3.5 percent. Repsol SA increased the most in a month after saying it discovered natural gas in Algeria. Lagardere SCA (MMB) lost the most in four months after selling its stake in European, Aeronautic, Defence & Space Co.

The Stoxx Europe 600 Index added 0.2 percent to 288.07 at the close of trading. The gauge yesterday rebounded from the biggest three-day selloff since July as German industrial output increased more than forecast. The measure has gained 3 percent this year as U.S. lawmakers agreed on a compromise budget and data fueled optimism the world�� biggest economy is recovering.

10 Best Gas Stocks To Buy For 2014: Worthington Energy Inc (WGAS)

Worthington Energy, Inc. (Worthington), formerly Paxton Energy, Inc., incorporated July 30, 2004, is an oil and gas exploration and production company with assets in Texas and in the Gulf of Mexico. Worthington�� assets in Texas consist of a minority working interest in limited production and drilling prospects in the Cooke Ranch area of La Salle County, Texas, and Jefferson County, Texas, all operated by Bayshore Exploration L.L.C. (Bayshore). The Company�� assets in the Gulf of Mexico consist of a leasehold working interests in certain oil and gas leases located offshore from Louisiana, upon which no drilling or production has commenced as of December 31, 2011, and a 10.35% interest in the recently drilled I-1 well and a 2% royalty interest in 14,400 acres in the Mustang Island Tract 818. On March 27, 2012, it acquired certain assets from Black Cat Exploration & Production, LLC.

In Texas, the Company has working interests ranging from 4% to 31.75% (net revenue interests ranging from 3% to 23.8125%) in the various wells. In the Gulf of Mexico it has a 70% leasehold working interest, with a net revenue interest of 51.975%, of certain oil and gas leases in the Vermillion 179 tract and 10.35% interest in the recently drilled I-1 well and a 2% royalty interest in 14,400 acres in the Mustang Island Tract 818. As of December 31, 2011, it had one producing well that generated average total monthly net revenue.

The Mustang Island 818-L Field, located in the Kleberg County waters of the Gulf of Mexico, is a field re-habilitation project targeting bypassed or only partially produced gas-condensate. Total production from the wells within the seismic coverage was 125.6 billion cubic feet. In January 2011, the Hercules Offshore 205 jack-up rig was contracted to re-enter the I-Well on the Mustang License Area. The oil and gas leases are located in the VM 179, which is in the shallow waters of the Gulf of Mexico offshore from Louisiana. VM 179 is at 85 inches water depth approximately ! 46 miles offshore Louisiana in the Gulf of Mexico.

10 Best Gas Stocks To Buy For 2014: Sunoco Inc.(SUN)

Sunoco, Inc., through its subsidiaries, refines and markets petroleum products in the United States. Its Logistics segment operates refined product and crude oil pipelines and terminals; and acquires and markets crude oil and refined products. As of December 31, 2011, this segment owned and operated approximately 5,400 miles of crude oil pipelines and approximately 2,500 miles of refined product pipelines. It also operates 42 active terminals that receive refined products from pipelines and distribute them to third parties. The company?s Retail Marketing segment engages in the retail sale of gasoline and middle distillates; and operation of convenience stores. This segment operates outlets primarily in Connecticut, Florida, Maryland, Massachusetts, Michigan, New Jersey, New York, Ohio, Pennsylvania, and Virginia. Its Refining and Supply segment offers petroleum products, including gasoline and residual fuel oil, as well as middle distillates, such as jet fuel, heating oil , and diesel fuel; and commodity petrochemicals comprising propylene-propane, benzene, and cumene. This segment offers its products to wholesale and industrial customers. The company was founded in 1886 and is based in Philadelphia, Pennsylvania.

10 Best Regional Bank Stocks To Watch For 2014: Noble Corp (NE)

Noble Corporation is an offshore drilling contractor for the oil and gas industry. The Company performs contract drilling services with its fleet of 79 mobile offshore drilling units and one floating production storage and offloading unit (FPSO) located globally. As of December 31, 2011, its fleet consisted of 14 semisubmersibles, 14 drillships, 49 jackups and two submersibles. Its fleet includes 11 units under construction, which include five ultra-deepwater drillships, and six jackup rigs. As of February 15, 2012, approximately 84% of its fleet was located outside the United States in areas, which included Mexico, Brazil, the North Sea, the Mediterranean, West Africa, the Middle East, India and the Asian Pacific. During the year ended December 31, 2011, it completed construction on the Noble Bully I, a drillship, owned through a joint venture with a subsidiary of Royal Dutch Shell plc; completed construction on the Noble Bully II, a drillship, and it completed construction of Globetrotter-class drillship. As of February 15, 2012, it had 10 rigs under contract in Mexico with Pemex Exploracion y Produccion (Pemex).

During 2011, the Company conducted offshore contract drilling operations, which accounted for over 98% of its operating revenues. It conducts its contract drilling operations in the United States Gulf of Mexico, Mexico, Brazil, the North Sea, the Mediterranean, West Africa, the Middle East, India and the Asian Pacific. During 2011, revenues from Shell and its affiliates accounted for approximately 24% of its total operating revenues. During 2011, revenues from Petroleo Brasileiro S.A. (Petrobras) accounted for approximately 18% and 19% of its total operating revenues. Revenues from Pemex accounted for approximately 15%, 20% and 23% of its total operating revenues.


Semisubmersibles are floating platforms which, by means of a water ballasting system, can be submerged to a predetermined depth so that a substantial portion of the hull is b! elow the water surface during drilling operations. As of December 31, 2011, the semisubmersible fleet consisted of 14 units, including five Noble EVA-4000 semisubmersibles; three Friede & Goldman 9500 Enhanced Pacesetter semisubmersibles; two Pentagone 85 semisubmersibles; two Bingo 9000 design unit submersibles; one Aker H-3 Twin Hull S1289 Column semisubmersible, and one Offshore Co. SCP III Mark 2 semisubmersible.


The Company�� drillships are self-propelled vessels. These units maintain their position over the well through the use of either a fixed mooring system or a computer controlled dynamic positioning system. Its drillships are capable of drilling in water depths from 1,000 to 12,000 feet. The maximum drilling depth of its drillships ranges from 20,000 feet to 40,000 feet. As of December 31, 2011, the drillship fleet consisted of 14 units, including four drillships under construction with Hyundai Heavy Industries Co. Ltd. (HHI); three Gusto Engineering Pelican Class drillships; two Bully-class drillships to be operated by it through a 50% joint venture with a subsidiary of Shell; one dynamically positioned Globetrotter-class drillship that left the shipyard during the fourth quarter of 2011; one Globetrotter-class drillship under construction; one moored Sonat Discoverer Class drillship capable of drilling in Arctic environments; one NAM Nedlloyd-C drillship, and one moored conversion class drillship.


As of December 31, 2011, the Company had 49 jackups in its fleet, including six jackups under construction. The rig hull includes the drilling rig, jacking system, crew quarters, loading and unloading facilities, storage areas for bulk and liquid materials, helicopter landing deck and other related equipment. All of its jackups are independent leg and cantilevered. Its jackups are capable of drilling to a maximum depth of 30,000 feet in water depths up to 400 feet.


The Company has two su! bmersible! s in the fleet, which are cold-stacked. Submersibles are mobile drilling platforms, which are towed to the drill site and submerged to drilling position by flooding the lower hull until it rests on the sea floor, with the upper deck above the water surface. Its submersibles are capable of drilling to a depth of 25,000 feet in water depths up to 70 feet.

10 Best Gas Stocks To Buy For 2014: Marathon Petroleum Corp (MPC)

Marathon Petroleum Corporation (MPC), incorporated on November 9, 2009, is a petroleum product refiners, transporters and marketers in the United States. The Company operates in three segments: Refining & Marketing, Speedway and Pipeline Transportation. Marathon Petroleum�� refining, marketing and transportation operations are concentrated in the Midwest, Gulf Coast and Southeast regions of the United States. MPC has two retail brands: Speedway and Marathon. Effective as of June 30, 2011, MPC was separated from Marathon Oil Corporation (Marathon Oil) and became an independent company in a spin-off transaction.

Refining & Marketing

The Company owned and operated six refineries in the Gulf Coast and Midwest regions of the United States with an aggregate crude oil refining capacity of approximately 1.2 million barrels per calendar day as of December 31, 2011. During 2011, its refineries processed 1,177 million barrels per day of crude oil and 181 mbpd of other charge and blend stocks. Its refineries include crude oil atmospheric and vacuum distillation, fluid catalytic cracking, catalytic reforming, desulfurization and sulfur recovery units. The refineries process a range of crude oils and produce numerous refined products, ranging from transportation fuels, such as reformulated gasolines, blend-grade gasolines intended for blending with fuel ethanol and ultra-low-sulfur diesel fuel, to heavy fuel oil and asphalt. Additionally, MPC manufacture aromatics, propane, propylene, cumene and sulfur.

The Company�� Garyville, Louisiana refinery is located along the Mississippi River in southeastern Louisiana between New Orleans and Baton Rouge. The Garyville refinery is configured to process heavy sour crude oil into products, such as gasoline, distillates, asphalt, polymer grade propylene, propane, isobutane, sulfur and fuel-grade coke. The Catlettsburg, Kentucky refinery is located in northeastern Kentucky on the western bank of the Big Sandy River, near the confluence! with the Ohio River. The Catlettsburg refinery processes sweet and sour crude oils into products such as gasoline, distillates, asphalt, cumene, petrochemicals, propane and propylene. The Robinson, Illinois refinery is located in southeastern Illinois. The Robinson refinery processes sweet and sour crude oils into products, such as multiple grades of gasoline, distillates, anode-grade coke, propane, butane and propylene.

MPC�� Detroit, Michigan refinery is located near Interstate 75 in southwest Detroit. It is the petroleum refinery operating in Michigan. The Detroit refinery processes light sweet and heavy sour crude oils, including Canadian crude oils, into products, such as gasoline, distillates, asphalt, slurry, propane, and propylene. Its Canton, Ohio refinery is located approximately 60 miles southeast of Cleveland, Ohio. The Canton refinery processes sweet and sour crude oils into products such as gasoline, distillates, asphalt, propane, slurry and roofing flux. Its Texas City, Texas refinery is located on the Texas Gulf Coast approximately 30 miles south of Houston, Texas. The refinery processes sweet crude oil into products such as gasoline, chemical grade propylene, propane, slurry and aromatics.

As of December 31, 2011, the Company owned and operated 62 light product and 21 asphalt terminals. In addition, it distributes through approximately 52 third-party light product and 12 third-party asphalt terminals in its market area. During 2011, marine transportation operations included 15 towboats, as well as 167 owned and 14 leased barges that transport refined products on the Ohio, Mississippi and Illinois rivers and their tributaries, as well as the Intercoastal Waterway. As of December 31, 2011, the Company leased or owned approximately 1,950 railcars of various sizes and capacities for movement and storage of refined products. In addition, it own 124 transport trucks for the movement of refined products.

The Company produces propane at all six of its! refineri! es. Propane is primarily used for home heating and cooking, as a feedstock within the petrochemical industry, for grain drying and as a fuel for trucks and other vehicles. The Company is also a producer and marketer of feedstocks and specialty products. Product availability varies by refinery and includes propylene, cumene, dilute naphthalene oil, molten sulfur, toluene, benzene and xylene. Propane is primarily used for home heating and cooking, as a feedstock within the petrochemical industry, for grain drying and as a fuel for trucks and other vehicles.


The Company sells transportation fuels and convenience products in the retail market in the Midwest, primarily through Speedway convenience stores. The Speedway segment sells gasoline and merchandise through convenience stores that the Companu owns and operates, primarily under the Speedway brand. Speedway-branded convenience stores offer a range of merchandise, such as prepared foods, beverages and non-food items, including a number of private-label items. As of December 31, 2011, Speedway had 1,371 convenience stores in seven states.

Pipeline Transportation

The Company transports crude oil and other feedstocks to our refineries and other locations, delivers refined products to wholesale and retail market areas and includes, among other transportation-related assets, a majority interest in LOOP LLC, which is the owner and operator of the United States deepwater oil port. It owns common carrier pipeline systems through Marathon Pipe Line LLC (MPL) and Ohio River Pipe Line LLC (ORPL), both of which are wholly owned subsidiaries. These pipeline systems transport crude oil and refined products, primarily in the Midwest and Gulf Coast regions, to its refineries, its terminals and other pipeline systems. The Company�� MPL and ORPL wholly owned carrier systems consist of 1,707 miles of crude oil lines and 1,825 miles of refined product lines comprising 31 systems located in 11 states, as of Decem! ber 31, 2! 011. In addition, MPL leases and operates 217 miles of common carrier refined product pipelines.

The common carrier refined product pipelines include the owned and operated Cardinal Products Pipeline and the Wabash Pipeline. The Cardinal Products Pipeline delivers refined products from Kenova, West Virginia, to Columbus, Ohio. The Wabash Pipeline system delivers refined products from Robinson, Illinois, to various terminals in the area of Chicago, Illinois. Other refined product pipelines owned and operated by MPL extend from: Robinson, Illinois to Louisville, Kentucky; Robinson, Illinois to Lima, Ohio; Wood River, Illinois to Indianapolis, Indiana; Garyville, Louisiana to Zachary, Louisiana, and Texas City, Texas to Pasadena, Texas.

As of December 31, 2011, the Company had partial ownership interests in the pipeline companies that have approximately 110 miles of crude oil pipelines and 3,600 miles of refined products pipelines, including about 970 miles operated by MPL, which include Centennial Pipeline LLC (Centennial), Explorer Pipeline Company (Explorer), LOCAP LLC (LOCAP), LOOP LLC (LOOP), Muskegon Pipeline LLC (Muskegon) and Wolverine Pipe Line Company (Wolverine).

The Company holds a 50% interest in Centennial, which owns a refined products pipeline system connecting the Gulf Coast region with the Midwest market. The Company holds a 17% interest in Explorer, a refined products pipeline system extending from the Gulf Coast to the Midwest. It holds a 51% interest in LOOP, the owner and operator of the Louisiana Offshore Oil Port, which is a deepwater oil port capable of receiving crude oil from large crude carriers, located 18 miles off the coast of Louisiana, and a crude oil pipeline connecting the port facility to storage caverns and tanks at Clovelly, Louisiana. The Company holds a 60% interest in Muskegon, which owns a refined products pipeline extending from Griffith, Indiana to North Muskegon, Michigan. It hold a 6% interest in Wolverine, a refined prod! ucts pipe! line system extending from Chicago, Illinois to Toledo, Ohio.

Advisors' Opinion:
  • [By Jim Jubak]

     A river of oil from the oil-shale boom in North Dakota and Texas is gradually making its way to the country's Gulf Coast refineries as pipelines and other infrastructure are built out. The arrival of oil from resources like the Eagle Ford and Bakken shales will mean rising margins at Gulf Coast refineries as they begin their work with cheaper oil.

    Marathon Petroleum (MPC) will get a big hunk of that refining business -- and those higher refining margins -- and it seems determined to gather in even more with its purchase in October of BP's (BP) Texas City refinery. Texas City gives Marathon a refinery close to growing crude production from Eagle Ford and the Permian Basin. What I like about this deal -- and Marathon Petroleum's positioning -- is that as the infrastructure buildout continues, the company will be able to grow margins and earnings by simply substituting cheaper mid-continent oil for more expensive imported oil.

10 Best Gas Stocks To Buy For 2014: Kodiak Oil & Gas Corp (KOG)

Kodiak Oil & Gas Corp. (Kodiak) is an independent energy company focused on the exploration, exploitation, acquisition and production of crude oil and natural gas in the United States. Kodiak has developed an oil and natural gas asset base of proved reserves, as well as a portfolio of development and exploratory drilling opportunities on high-potential prospects with an emphasis on oil resource plays. The Company�� oil and natural gas reserves and operations are primarily concentrated in the Williston Basin of North Dakota. As of January 31, 2012, it had approximately 169,000 net acres under lease, including 157,000 net acres in the Bakken oil play in the Williston Basin of North Dakota and Montana. In January 2012, the Company acquired Williston Basin oil and gas producing properties and undeveloped leasehold. On January 10, 2012, it acquired certain oil and gas leaseholds, overriding royalty interests and producing properties located in North Dakota.

10 Best Gas Stocks To Buy For 2014: Valero Energy Corporation(VLO)

Valero Energy Corporation operates as an independent petroleum refining and marketing company. The company operates through three segments: Refining, Ethanol, and Retail. The Refining segment engages in refining, wholesale marketing, product supply and distribution, and transportation operations. It produces conventional gasoline, distillates, jet fuel, asphalt, petrochemicals, lubricants, and other refined products. This segment also offers conventional blendstock for oxygenate blending, reformulated gasoline blendstock for oxygenate blending, gasoline meeting the specifications of the California Air Resources Board (CARB), CARB diesel fuel, low-sulfur and ultra-low-sulfur diesel fuel. The Ethanol segment produces ethanol and distillers grains. The Retail segment sells transportation fuels at retail stores and unattended self-service cardlocks; convenience store merchandise and services in retail stores; and home heating oil to residential customers. Valero Energy Corpora tion markets its refined products through bulk and rack marketing network; and sells refined products through a network of approximately 6,800 retail and wholesale branded outlets under the Valero, Diamond Shamrock, Shamrock, Ultramar, Beacon, and Texaco names in the United States, Canada, the United Kingdom, Aruba, and Ireland. As of December 31, 2011, it owned 16 petroleum refineries with a combined throughput capacity of approximately 3.0 million barrels per day; and operated 10 ethanol plants with a combined nameplate production capacity of approximately 1.1 billion gallons per year. The company was formerly known as Valero Refining and Marketing Company and changed its name to Valero Energy Corporation in August 1997. Valero Energy Corporation was founded in 1955 and is based in San Antonio, Texas.

10 Best Gas Stocks To Buy For 2014: Samson Oil and Gas Ltd (SSN)

Samson Oil & Gas Limited (Samson), incorporated on April 6, 1979, is engaged in exploration and development of oil and natural gas properties in the United States. Samson owns a working interest in each of its three material producing properties, through which it has entered into operating agreements with third parties under which the oil and gas are produced and sold. The Company also has 100% working interest in one exploration property and 50% to 100% in a second property. As of June 30, 2012, the Company�� properties included North Stockyard Project; State GC Oil and Gas Field, New Mexico; Davis Bintliff (Sabretooth Prospect), Brazoria County, Texas; Hawk Springs Project, Goshen County, Wyoming, and Roosevelt Project, Roosevelt County, Montana. As of June 30, 2012, the Company along with its subsidiaries produced approximately 87,956 barrels of oil and 214,463 thousand cubic feet of gas.

North Stockyard Project -Williston Basin, North Dakota

Samson has 34.5% working interest in 3,303 acres adjacent to the North Stockyard Oil Field, which is located in the Williston Basin in North Dakota and is operated by Zavanna LLC. Together with the Company�� working interest owners, it has drilled seven wells in this field, six in the Bakken formation and one in the Mission Canyon formation. During July 2012, the Harstad #1-15H well averaged 15 barrels of oil per day (BOPD). The Leonard-23H (10% working interest, 37.5% after non-consent penalty) is a Mississippian Middle Bakken Formation. In July 2011, this well averaged 46 barrels of oil per day. The Company drilled its third Bakken well in the North Stockyard Field, the Gary-24H (37% working interest). During July 2012, this well averaged 75 BOPD. It drilled its fourth Bakken well in the North Stockyard Field, the Rodney-14H (27% working interest). In July 2011, this well averaged 92 BOPD. It drilled its fifth Bakken well in the North Stockyard Field in Williams County, North Dakota, the Earl 1-13H (32% working interest). In Jul! y 2011, the well averaged 193 BOPD. In June 2011, it drilled its sixth Mississippian Bakken well in the North Stockyard field in Williams County, North Dakota, the Everett 1-15H (26% working interest). As of June 30, 2012, the North Stockyard project had net proved reserves of 598,500 barrels of oil and 757,800 thousand cubic feet (of natural gas).

State GC Oil and Gas Field, New Mexico

The State GC oil and gas field is located in Lea County, New Mexico, and covers approximately 600 acres. As of June 30, 2012, the field had two wells, the State GC#1 and State GC#2. Average daily production during the year ended June 30, 2012 from the State GC oil and gas field was approximately 43 BOPD and 37 million standard cubic feet per day. As of June 30, 2012, the State GC oil and gas field had net proved reserves of 65,500 barrels of oil and 87,300 thousand cubic feet (of natural gas).

Davis Bintliff #1 Well (Sabretooth Prospect), Brazoria County, Texas

The Davis Bintliff #1 well is operated by Davis Holdings. During the year ended June 30, 2012, this well averaged 29 BOPD and 2.61million cubic feet per day. As of June 30, 2012, the Davis Bintliff well had net proved reserves of 700 barrels of oil and 66,400 Thousand cubic feet (of natural gas).

Hawk Springs Project, Goshen County, Wyoming

The Company has 37.5%-100% working interest in Hawk Springs Project. The Spirit of America 1 replacement well, Spirit of America 2, was successfully drilled to a total depth of 10,634 feet during the fiscal year ended June 30, 2012 (fiscal 2012).

Roosevelt Project, Roosevelt County, Montana

The well was drilled to a total measured depth of 14,972 feet with the horizontal lateral remaining within the target zone for the entire lateral length. approximately 3,425 barrels of oil have been produced.

10 Best Gas Stocks To Buy For 2014: Encana Corporation(ECA)

Encana Corporation and its subsidiaries engage in the exploration for, development, production, and marketing of natural gas, oil, and natural gas liquids. The company owns interests in resource plays that primarily include the Greater Sierra, Cutbank Ridge, Bighorn, and Coalbed Methane resource plays located in British Columbia and Alberta, as well as the Deep Panuke natural gas project offshore Nova Scotia in Canada. It also holds interests in resource plays comprising the Jonah in southwest Wyoming, Piceance in northwest Colorado, Haynesville in Louisiana, and Texas resource play, including east Texas and north Texas. The company serves primarily local distribution companies, industrials, energy marketing companies, and other producers. Encana Corporation was founded in 1971 and is headquartered in Calgary, Canada.

Advisors' Opinion:
  • [By Richard Young]

    You can see on my relative strength chart what is likely a bottom in EnCana (NYSE:ECA) shares. With EnCana’s competitor Chesapeake Energy (NYSE:CHK) announcing natural gas production cuts, it’s only a matter of time before other production companies do the same. The slowdown in drilling activity should put a bottom on the price of gas. The effect has translated into a bottom on EnCana Corp shares. Buy EnCana Corp. today and lock in a yield near 4%.

10 Best Gas 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 Roberto Pedone]

     Gastar Exploration (GST) is an independent energy company, engaged in the exploration, development and production of natural gas and oil in the U.S. This stock is trading up 2.8% to $1.26 in recent trading.

    Today’s Range: $1.24-$1.30

    52-Week Range: $0.70-$3.36

    Volume: 186,000

    Three-Month Average Volume: 516,159

    From a technical perspective, GST is bouncing modestly higher here right above some near-term support $1.15 with light volume. This stock has been uptrending strongly for the last month and change, with shares soaring from a low of 70 cents to its recent high of $1.38. During that move, shares of GST have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed GST within range of triggering a major breakout trade. That trade will hit if GST clears some near-term overhead resistance levels at $1.38 to $1.39 with high volume.

    Traders should now look for long-biased trades in GST as long as it’s trending above $1.15, and then once it sustains a move or close above those breakout levels with volume that hits near or above 516,159 million shares. If that breakout triggers soon, then GST will set up to re-test or possibly take out its next major overhead resistance level at its 200-day moving average of $1.77 or possible even $1.89 to $1.96.

10 Best Gas Stocks To Buy 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 Tom Bishop]

    Weatherford International (WFT) is trading around $14. Weatherford is a leading provider of equipment and services to the oil and gas industry, based in Switzerland. These shares have traded in a range betwe en $10.85 to $26.25 in the last 52 weeks. The 50-day moving average is $15.46 and the 200-day moving average is $19.62. WFT is estimated to earn about 88 cents per share in 2011 and $1.67 for 2012. Analysts at UBS set a $28 price target for WFT share.