People Are Talking About Altria

Whether you're considering a company as a possible investment or just intent on keeping up with a stock you already own, it's smart to read its quarterly and annual reports and its coverage in the news. But it can also be illuminating to seek out some scuttlebutt about the company, to see what others are saying about it -- and perhaps how it's responding. After all, companies creating relationships with their customers are building their brands -- and a strong brand can boost market share and offer pricing power.

Let's run through an example: domestic tobacco giant Altria (NYSE: MO  ) .

Why Altria?
The company is what's left after international operations were spun off in the form of Philip Morris International (NYSE: PM  ) in 2008. While Philip Morris is favored by many because of lower tobacco taxes and regulations in many parts of the world, as well as the fact that many economies are growing more rapidly than ours, Altria still manages the very valuable Marlboro brand domestically, where it recently held a commanding 43% market share.

Some see Altria threatened by growth in electronic cigarettes ("e-cigs"), in which companies such as Lorillard (NYSE: LO  ) specialize, but Altria has billions in annual cash flow and could still become a significant player there. E-cigs seem more a threat to nicotine gum purveyors such as Johnson & Johnson and GlaxoSmithKline. Star Scientific would also have been considered a bit of a threat not so long ago, with its smokeless-tobacco products, but it has been shifting its focus toward health supplements.

People are talking
On Twitter, via @AltriaNews, the company shares information related to its U.S. operations. It recently noted, for example, that its U.S. Smokeless Tobacco company uses 100% American-grown tobacco, to boost its image among those who like the idea of buying American. That got the kind of reaction the company presumably wanted, receiving a tweet of praise. But that was from just one person. After all, the account has only about 1,500 followers.

The company is responsive, though. When one tweeter posted, "I'm having a Major issue accessing your website!! And it is Very frustrating. I'm playing the new game and I can't access it," the company offered assistance with its website via a phone number.

Search simply for mentions of Altria on Twitter, though, and you'll find more content, such as links to articles in the business media about Altria as an investment (citing, for example, its attractive and rather reliable 5% dividend), and also about its CEO's generous 2012 compensation that topped $10 million. That's not the kind of detail that the company itself will likely highlight.

Technology journalist Harry McCracken tweeted that he "Just watched a lengthy recruiting video ad for Altria (aka Philip Morris) which never mentions exactly what it does. http://twitpic.com/c95ldc" A response to that tweet sheds light on why Altria might not be eager to have too big a national conversation going, as smoking is a controversial topic and the company has plenty of detractors. The second tweeter's reply said: "re: Altria Not easy putting a positive spin on "We help people die faster!"

On Facebook, the Marlboro Cigarette Brands page has more than 375,000 people liking it, but little activity. On Google+, there's an Altria page sharing much the same news as the Twitter feed.

Numbers talk, too
It's always good to balance qualitative observations and anecdotes with some quantitative realities. For example, in the world of Twitter, while Altria's "news" feed sports only about 1,500 followers, that's still more than the news feed of rival and owner of the No. 2 U.S. cigarette brand, Camel, Reynolds American, which recently had 172. 

Meanwhile, Altria seems to be finding success in building its brand -- via social interactions, advertising, and other means: According to researchers at Millward Brown Optimor and BrandZ, Marlboro was the world's seventh-most valuable brand last year, worth about $79 billion. And that was up 9% over year-ago levels. Clearly, the company is doing some things right.

Learn more
You can learn even more about this company and others via sources such as Glassdoor.com, where employees spout about the companies they work for, and LinkedIn.com, where you'll find, among other things, job listings that can clue you in to how a company is growing.

The more digging you do, the better understanding you'll likely develop of any company that interests you. If you run across any more interesting tidbits about Altria, share them in the comments section below.

Altria has been the best-performing stock of the past 50 years, but as the number of smokers in the U.S. continues to steadily decline, is Altria still a buy today? To find out whether everyone's love-to-hate dividend stock is a savvy investment choice or a hazard to your portfolio, simply click here now for access to The Motley Fool's premium research report on the company.

[4] [5] [8] [10] [13] [14] [18] [21] Hot Building Product Companies To Watch In Right Now

tags:NASDAQ, TRST  ,NYSE, AKS  , NYCB  , TLAB  , ABBV  ,,Building Product,Utilities,MXG.TO,Technology,IXYS,Basic Materials,WHX,

There's never a dull week on Wall Street. Let's go over some of the news that will shape the week to come.

Monday
The market kicks off with TrustCo (NASDAQ: TRST  ) reporting quarterly results on Monday. Many of the "too big to fail" institutions reported in recent days, but now it's time to check out some of the regional players. TrustCo has 138 offices through the Northeast and Florida, watching over $4.3 billion in assets.

Tuesday
AK Steel (NYSE: AKS  ) hopes to "steel" the show on Tuesday. The producer of flat-rolled carbon, stainless, and electrical steels is expected to post another quarterly deficit. AK Steel provided guidance last month that calls for a sequential dip in production. It was expecting to ship between 1.275 million and 1.3 million tons of steel during the first three months of the year, and that's less than the more than 1.4 million tons it shipped during the fourth quarter of last year.

Hot Building Product Companies To Watch In Right Now: Maxim Power Corp Com Npv (MXG.TO)

Maxim Power Corp., an independent power producer, engages in the acquisition, development, ownership, and operation of power generation facilities, as well as sale of electricity and heat. The company primarily generates electricity through coal, natural gas, waste heat, and landfill gas fuelled cogeneration facilities. It owns and operates 40 power plants with 788 megawatts (MW) of electric and 111 MW of thermal net generating capacity in western Canada, the United States, and France. The company is based in Calgary, Canada.

Hot Building Product Companies To Watch In Right Now: IXYS Corporation(IXYS)

IXYS Corporation, an integrated semiconductor company, engages in the development, manufacture, and marketing of power semiconductors, advanced mixed signal integrated circuits (ICs), application specific integrated circuits (ASICs), microcontrollers, and systems and radio frequency semiconductors. It offers power metal oxide silicon field effect transistors; insulated gate bipolar transistors; and thyristors and rectifiers, including fast recovery epitaxial diodes. The company?s power semiconductors are used primarily in controlling energy in motor drives; power conversion systems, including switch-mode and uninterruptible power supplies; medical electronics; and renewable energy sources. It also provides ICs, such as solid state relays for telecommunications applications; power management and control ICs comprising current regulators, motion controllers, digital power modulators, and drivers; microcontrollers, including embedded flash microcontrollers, core 8-bit microc ontrollers, and microprocessors; and line card access switch and data access arrangement integrated products. The company?s mixed signal ICs are used in telecommunications products, central office switching equipment, customer premises equipment, set top boxes, remote meter reading equipment, security systems, flat displays, medical electronics, and defense aerospace systems. In addition, it manufactures and sells laser diode drivers, high voltage pulse generators and modulators, high power subsystems/modules/stacks, and direct copper bond substrates. Its radio frequency power devices are used in wireless infrastructure, industrial radio frequency applications, medical systems, and defense and space electronics. It sells its products principally in the United States, Europe and the Middle East, and the Asia Pacific through direct sales personnel, independent representatives, and distributors. IXYS Corporation was founded in 1987 and is headquartered in Milpitas, California.

Top Food Stocks To Own Right Now: Whiting USA Trust I(WHX)

Whiting USA Trust I is a REIT. The trust was founded in 2007 and is based in Austin, Texas.

These Commercials Aren't Out to Help You: Thoughts on Day Trading

In the following video, Fool contributor Matt Thalman discusses why TD AMERITRADE (NYSE: AMTD  ) , Charles Schwab (NYSE: SCHW  ) , and all the other online brokerage houses offer investors high-tech trading platforms and services that are intended and sold to help individuals find opportunities others haven't yet seen.

While following chart patterns and trying to turn profits on a small daily moves may sound like a great idea, over the long run, most investors will end up losing more money than they make. But more importantly, every time investors buy or sell a stock, they pay a transaction fee, which will surely eat into any profits the average Joe day trader can make.

So whom are these trading platforms really making money for? Watch the video for more details.

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How Ford's Fusion Is Eating Toyota's Lunch

Toyota's (NYSE: TM  ) Camry has been the best-selling car in America for ages. Or maybe I should say "had been": Sales are down this year. Are rivals catching up?

It looks like they are. One of those rivals is Ford's (NYSE: F  ) new Fusion, which is posting big gains as Toyota's standard-bearer is falling behind. In this video, Fool.com contributor John Rosevear looks at what's going on with the Camry and its foes -- and whether Ford's hot new ride could pass the Camry and take the title.

It's not too late to buy Ford's stock
If you're concerned that Ford's turnaround has run its course, relax -- there's good reason to think that the Blue Oval still has big growth opportunities ahead. We've outlined those opportunities in detail, in the Motley Fool's premium Ford research service. If you're looking for some freshly updated guidance to Ford's prospects in coming years, you've come to the right place -- click here to get started now.

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Can These Dividend Superstars Maintain Rising Payouts?

In the depths of the financial crisis in late 2008, shares of tobacco maker Lorillard (NYSE: LO) were struggling as much as any other blue-chip stock.

That summer, shares slid from around $20 to nearly $15 by autumn, and few had the guts to step in and catch that falling knife. Still, the $1.56 a share dividend must have tempted some investors, as the dividend yield briefly moved above 10%.

Five years later, those intrepid few are very pleased indeed, as Lorillard's dividend now stands at $2.20 a share. That works out to be a 14% current yield on that 2008 share price, which nicely complements a nearly 200% rebound for the stock.

And this tobacco maker has company. Lorillard is one of a handful of companies that have boosted their dividends by an average of at least 17% in the past three years.

Investors are increasingly focusing on these kinds of companies, as they tend to keep boosting their dividends at an aggressive pace. Take a look at the top dividend boosters over a five-year span. Many of the three-year winners make the grade here as well.

In fact, it should come as no surprise that the most robust dividend hikers over the past few years are also among the companies with the most impressive dividend growth over the past decade. Year in and year out, these companies have been returning more cash to shareholders. If you managed to buy any of these stocks a decade ago, you should be quite pleased.

Looking ahead, it's fair to wonder if these dividend champs can remain atop the leaderboard. After all, as I've noted, some of them, such as L Brands (NYSE: LTD), are already bumping up against fairly high payout ratios, which means that dividends will likely only grow at the rate of earnings growth.

 

Yet some of these stocks surely have what it takes to stay at the forefront of the dividend arms race. I took a deeper look at the companies noted on the tables above, seeking out companies with reasonable payout ratios and solid earnings growth prospects. A few names stand out.

Archer Daniels Midland (NYSE: ADM)
Prior to the financial crisis of 2008, this leading agricultural giant was clearly committed to steady and strong dividend growth. Yet over the past half decade, the company has seen its growth sharply slow as key divisions such as ethanol production generated lousy financial returns. 

Yet as I've noted, ADM is becoming a favorite of Warren Buffett's. And Buffett is known for his focus on companies with rising cash flow prospects. How do we know ADM is poised for rising cash flow? Because the company just started paying more attention to its dividend, boosting it by more than 20%, its largest increase in a decade.

ADM Dividend Growth Rate

Source: Thomson Reuters

Analysts at Merrill Lynch predict that ADM's net income will be flat in 2013, but they foresee net income climbing 30% in 2014 and another 14% in 2015. Simply keeping the payout ratio constant would yield robust dividend increases. Yet ADM's payout ratio, with the exception of 2012, has typically been around 20%. A hike in the payout ratio to 30%, coupled with the cash flow gains, could lead to 15% to 20% annual dividend increases for quite a while to come.

ADM Payout Ratio

Intel (Nasdaq: INTC)
This chipmaker has boosted its dividend at a double-digit pace in eight of the nine past years. What was once a 16-cent-a-share annual dividend in 2004 has grown into a dividend that is already up to 90 cents. Although profit growth remains fairly anemic, Intel has been earning more than $10 billion a year in each of the past three years. Assuming the company's current $13 billion in net cash is more than sufficient to run operations, Intel can -- and should -- return excess profits to shareholders. Assuming a 75/25 split between dividend payments and share buybacks, Intel could afford to offer a dividend of $1.50 a share. 

Risks to Consider: Every half-decade or so, the economy spooks companies into holding the line on dividends, or even forces them to cut them, so don't expect dividend growth to always take place in a linear fashion.

Action to Take --> If you are in search of companies capable of robust dividend growth, then take a look at the historical payout ratios. If income is now growing faster than the dividend, then the payout ratio has probably fallen and could soon be in for a freshening.

P.S. -- If you want to know about one of the most effective dividend strategies around, then you have to find out about "The Dividend Trifecta." Simply put, it's a three-part approach to dividends that multiplies the effectiveness of every dollar you invest. The plan is specifically engineered for people who want to retire sooner or for those who would like to get a steady stream of extra income now. Go here to learn more...

Seagate Is a Top Tech Pick

Hard drive manufacturer Seagate Technology (NASDAQ: STX  ) soared to new highs this week on what should have been a predictable business update and earnings release. The company pays a 4% dividend and has near-perfectly executed an adaptation strategy to address the shift away from PCs -- all while analysts and pundits have predicted its demise along with its peers'. To top things off, Barron's released its top 500 American companies, including Seagate as a top 10 pick. The best part of the story is that Seagate is still cheap, even after a 12-month gain of nearly 40% and more than 30% year to date.

It's time to get over your fears of PC demand and take a serious look at this industry leader.

Enough
To avoid a company such as Seagate because PCs are approaching extinction is like not eating because you're scared of choking. For years, the company has been in motion to protect itself from the declining segment and has built out a product lineup via development and acquisition that addresses new hard drive trends, such as solid state drives, along with rising industries such as the cloud. By the time PC revenue drops to a negligible amount, Seagate won't even be in the business. So why let a macro trend blindly dictate individual company performance?

In the past week, it looks like maybe, hopefully, investors are coming around to reality.

Starting from 2012's June quarter, Seagate has generated more than $3.3 billion in cash flow from operations, implying a trailing P/OCF of less than five times. Now, the two earlier quarters were still benefiting from market share domination and pricing advantages from the Thai floods, but even if we adjust going forward, the company is trading cheap. On an EV/EBTIDA basis, the company trades at 4.5 times.

With all of this free cash flow, Seagate is just buying back shares and paying dividends. Share buybacks aren't always ideal, but as Barron's mentions in its flattering article, the company has shown that its buyback strategy is anything but short-term focused. It's bought shares throughout the downtrends and wild swings, while reducing share counts by more than 1%.

In the first nine months of fiscal 2013, Seagate returned 75% of its cash to shareholders.

Strong outlook, weak valuation
The market will come around to Seagate's mispricing, at some undisclosed point in the future. It doesn't matter when, because we all know stocks eventually drift toward their intrinsic value.

Still think its business is shrinking? The company shipped 33% more exabytes this quarter compared to a year ago.

Investors can also look at Western Digital (NASDAQ: WDC  ) , which is similarly valued and well managed. The only reason I would take Seagate over Western Digital (as I view the businesses nearly identically) is that the dividend is quite a bit chunkier than Western Digital's 1.7%.

Seagate was an unbelievable bargain a year ago, and remains a pretty good deal today. If you are scared of the PC's demise, don't invest in Dell. But try not to let analyst and pundit scare tactics work their way into your portfolio.

While Seagate Technology pays a significant and growing dividend and seems able to generate the cash flow to support it, a global slowdown in demand for digital memory storage has begun to put pressure on margins. Is Seagate worthy of your investment consideration (and dollars)? The Motley Fool answers this question and more in our most in-depth Seagate research available for smart investors like you. Thousands have already claimed their own premium ticker coverage, and you can gain instant access to your own by clicking here now.

Is IMAX Among the Best Stocks to Invest in Now?

Iron Man 3 is a huge hit everywhere, especially in China, where IMAX (NYSE: IMAX  ) booked $1.8 million in gross receipts -- a new record -- as Walt Disney (NYSE: DIS  ) set a high watermark of its own.

If you're wondering if that makes IMAX one of the best stocks to invest in now, you aren't alone, says Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova. More than 1,600 Fools have rated the stock in our CAPS investor intelligence database, giving it four out of five stars.

They've good reason to be confident. Even as 3-D too often falls flat, audiences have taken to the widescreen IMAX format and the additional footage that often comes with it. For Iron Man 3, the company collected a record-breaking $28.6 million at the gate during this past weekend's U.S. opening and $39.3 million since its international debut. The best part? It's only May. IMAX could be well on its way to the biggest summer movie season in its history, Tim says.

Do you agree? Please watch the video to get Tim's full take, and then let us know whether you think IMAX is one of the best stocks to invest in now using the comments box below.

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Can You Read Universal Display's Mixed Messages?

Shares of OLED technology expert Universal Display (NASDAQ: PANL  ) are plunging today, down 13.4% as of this writing -- no, make that 13.8%. The downward trajectory is pretty clear.

What did the company do to deserve a beating in the middle of Wall Street? Last night's first-quarter report didn't exactly impress.

In raw numbers, this quarter was just fine. Analysts were expecting a net loss of $0.10 per share on roughly $14.4 million in sales. Reported earnings matched that $0.10 target exactly, and sales came in a tad higher at $15.0 million.

But it wasn't a "beat and raise" victory lap. Instead, management simply underscored revenue existing guidance for the just-started fiscal year, ranging from $110 million to $125 million.

That's disappointing due to the simple fact the largest customer Samsung has a hit on its hands with the Galaxy S4 smartphone. The Korean company can hardly make enough components to satisfy global orders, and this OLED-equipped handset is expected to roughly double last year's Galaxy S3 sales.

So, many investors expected Universal's numbers to jump, as the Galaxy S4's success was baked into forecasts. And it didn't happen.

Perhaps this kinda-sorta miss also inspired investors to take a closer look at Universal's fundamental trends. Sales are going through the roof, but profits and cash flows haven't followed suit.

Universal Displays Mixed Messages | Infographics. TTM = trailing 12 months.

As a Universal Display shareholder myself, this is how I'm reading Universal's mixed messages today.

OLED technologies are still in a very early stage of development. Samsung's Galaxy line has sprinkled a few OLED screens across store shelves globally, but mostly in relatively high-end and expensive products with small screens.

Universal Display generally gets paid by the gram of OLED materials, so screen size matters a lot. The real moment of truth comes if and when big-screen OLED TV sets hit the mainstream. Sony introduced a small OLED TV model in 2007; Samsung and LG Display will debut 55-inchers this year. But these are all very expensive, low-volume products. "Mainstream" means mass production and the virtuous cycle of economies of scale. And we're not there yet.

To prepare for that hockey-stick moment, Universal boosted its research and development budget by 33% over the last year. Its phosphorous OLED pixel sales have generally been of the red variety so far, but green emitters contributed a significant slice of this quarter's revenue. The company is also working up better blue and yellow materials, as well as various layers of the OLED screen's materials stack.

Why not build a much stronger product portfolio before your end market really hits the big time? That's what's happening here, and why the bottom line looks so thin. You have to spend money now to make money later. I think I've seen this story somewhere else recently...

Look at that, the stock is down 16% now. Time flies. This volatile stock sure gives investors plenty of opportunities to pick up shares on the cheap.

Universal Display has a powerful patent portfolio behind OLEDs, a technology poised to dominate the displays of the future. Its placement at the center of OLEDs makes the company an underappreciated way to play the enormous sales growth in tablets and smartphones. However, like any new technology, there are plenty of risks to Universal Display. Motley Fool analyst Evan Niu, CFA, has authored a new premium report that dives into reasons to buy the company as well as the challenges facing it. For access to this comprehensive report, simply click here now.

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The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.

Boeing's Dreamliner -- and Its Stock -- Are Flying

U.S. stocks started the week off on a strong note, as the S&P 500 (SNPINDEX: ^GSPC  ) and the Dow Jones Industrial Average (DJINDICES: ^DJI  ) both gained 0.7% and 0.1%, respectively. That was enough to push the S&P 500 to a record high, with the index recording gains in six of the last seven trading sessions. That consistency on the upside is also present when we widen out the timescale: With one day left in April, the S&P 500 is ahead 1.6% on the month, which means it is well positioned to record its sixth consecutive monthly gain -- its longest streak since Sep. 2009.

Somewhat unusually, in light of stocks' buoyancy, the VIX Index (VOLATILITYINDICES: ^VIX  ) , Wall Street's fear gauge, rose today by 1%, to close at 13.71. (The VIX is calculated from S&P 500 option prices and reflects investor expectations for stock market volatility over the coming 30 days.) This may be the result of hedging activity by investors in the run-up to the Fed's rate-setting meeting on Tuesday and Wednesday

Flying high!
What an extraordinary turn of events! I never expected to hear that a Boeing (NYSE: BA  ) 787 Dreamliner would be up and flying -- in a scheduled commercial flight, not a test flight -- before the month of April was out. Yet that's exactly what happened on Saturday, as Ethiopian Airlines flight 801 took off from the Ethiopian capital of Addis Ababa en route to Nairobi, Kenya. (It did arrive safely, in case you were wondering.)

On Sunday, Japanese airline ANA, which is the largest operator of 787s, with a fleet of seventeen, conducted a test flight, two days after Japanese regulators lifted a flight ban on the aircraft. ANA said it may resume commercial flights in June.

Regulators worldwide grounded the Dreamliner in January, following two incidents in which the aircraft's advanced lithium-ion battery unit overheated, producing smoke and catching fire.

I'm puzzled that regulators have approved what looks like an aggressive flight resumption timetable, particularly if one considers that the cause of the problem has not been identified. Instead, Boeing has proposed a series of modifications, including a different battery containment enclosure, which were approved by the FAA on April 19.

The market, on the other hand, seems to have discounted this best-case scenario from the outset, despite the massive headline risk the company faced:

Source: BA data by YCharts.

The shares barely went into negative territory and, although they did underperform the market through February, they now have the S&P 500 eating their dust. While that price behavior seems extraordinary to me, it suggests two things: First, the market had a better appreciation for this story than I did, and, second, the stock began the year significantly undervalued.

Boeing operates as a major player in a multitrillion-dollar market in which the opportunities and responsibilities are absolutely massive. However, emerging competitors and the company's execution problems have investors wondering whether Boeing will live up to its shareholder responsibilities. In our premium research report on the company, two of The Motley Fool's best minds on industrials have collaborated to provide investors with the key, must-know issues surrounding Boeing. They'll be updating the report as key news hits, so don't miss out -- simply click here now to claim your copy today.

Is GM About to Make a Big Leap?

General Motors' (NYSE: GM  ) stock was part of the benchmark S&P 500 Index for decades, but was kicked out when it entered bankruptcy in 2009.

It could soon be back, though: GM has recovered well from its near-death experience, and now meets all of S&P's criteria for inclusion. In this video, Fool.com contributor John Rosevear explains why rejoining the benchmark index is important to GM -- and why it could be a very good thing for GM investors.

Is it time to invest in General Motors?
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Tesla Model S Outscores Every Car in Consumer Reports Testing

After reviewing Tesla's (NASDAQ: TSLA  ) Model S, Consumer Reports has given the electric car top marks, saying in a blog post today that it performed better than cars built by companies that have been around for more than 100 years.

The nonprofit consumer-product rating company said the Model S outscored every other car in its test ratings. "It does so even though it's an electric car. In fact, it does so because it is electric," the company wrote. "So is the Tesla Model S the best car ever? We wrestled with that question long and hard. It comes close." One limitation is the car's range and the inability to jump in and drive wherever you want at a moment's notice, said CR.

Consumer Reports takes note of Tesla's battery placement (giving the vehicle a low center of gravity), front and rear trunk space, braking, acceleration, quietness of the cabin, and 17-inch touchscreen in the center of the dashboard. It also noted "impressive" power and long-range battery as key aspects of the car's benefits. Consumer Reports said the Model S uses about half as much energy every mile as Toyota's Prius.

The Model S that Consumer Reports tested was purchased for about $91,000 and included an upgraded large-capacity battery, a seven-passenger seating option, an upgraded charger for faster charging, and a High Power Wall Connector. In an online video, the organization said the Model S "performs better than anything we've ever tested before." 

link

Nike Strikes Back at Under Armour: Is "I Will" Famous?

Back in February, up-and-coming performance-apparel specialist Under Armour (NYSE: UA  ) raised some eyebrows when it filed a lawsuit against its biggest competitor and global powerhouse Nike (NYSE: NKE  ) .

The allegation? Under Armour claims Nike's latest ad campaigns were aiming to create confusion by illegally using variations of Under Armour's trademarked "I will" catchphrase.

Image source: Under Armour.

Earlier this week, Nike finally came out to formally deny the charges, and took a few shots at its smaller competitor by saying the "I will" phrase is "not famous" and hasn't "acquired the distinctiveness or secondary meaning associated with Under Armour." As a result, Nike says, that renders Under Armour's trademark essentially useless under trademark infringement law.

Going even further, Nike also claims it has used the "non-verb" combo in its own marketing as early as 1995, predating Under Armour's use of the words as far back as 1998. Then, in one last jab, Nike representatives wrote, "To the extent Under Armour owns any alleged trademark rights in the phrase, 'I will,' those rights are weak [and] narrow, and exist in a crowded field."

Of course, Under Armour was quick to respond, with company spokesman Tai Foster writing in an email to the Baltimore Business Journal to say the company is aware of Nike's response. In addition, Foster wrote, "We prefer to battle our competitors in the marketplace, but we must defend our brand when necessary and remain committed to vigorously protecting our 'I Will' trademark."

For Nike, what's the point?
Considering Nike penned its "Just do it" slogan way back in 1988, the Oregon-based company certainly knows a thing or two about famous catchphrases.

But honestly, of all the endless possibilities for Nike to mix things up with its advertisements, was it really necessary for its marketing team to excessively focus on the words "I will" this time around?

Perhaps it was.

In fact, while we're on the topic of familiar phrases, here's one you might have heard before: "Arrogance stems from insecurity."

Don't get me wrong; Nike is an incredible company with a fortress-like balance sheet and an intimidating presence in every global market that matters. 

However, as I noted when the initial lawsuit was announced, I can't help wondering whether Nike is more interested in trying to slow Under Armour's rise than anything else. After all, as of its most recent report, Under Armour has grown overall revenue by at least 20% year over year for the past 12 quarters, and the tiny company is only just getting started to gain steam with its international expansion.

Then again, I'm no lawyer, so maybe Under Armour's just overreacting and Nike is perfectly justified in its response. In any case, you can bet I'll be watching to see who comes out on top.

What do you think? Is Nike in the wrong, or should Under Armour never have filed this lawsuit in the first place? Sound off in the comments section below.

More expert advice from The Motley Fool
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Show Me the Money, Multi-Fineline Electronix

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

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

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

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

Over the past 12 months, Multi-Fineline Electronix burned $5.3 million cash while it booked a net loss of $11.7 million. That means it burned through all its revenue and more. That doesn't sound so great.

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

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

So how does the cash flow at Multi-Fineline Electronix look? Take a peek at the chart below, which flags questionable cash flow sources with a red bar.

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

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

With questionable cash flows amounting to only 3.2% of operating cash flow, Multi-Fineline Electronix's cash flows look clean. Within the questionable cash flow figure plotted in the TTM period above, stock-based compensation and related tax benefits provided the biggest boost, at 6.0% of cash flow from operations. Overall, the biggest drag on FCF came from capital expenditures.

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

If you're interested in companies like Multi-Fineline Electronix, you might want to check out the jaw-dropping technology that's about to put 100 million Chinese factory workers out on the street – and the 3 companies that control it. We'll tell you all about them in "The Future is Made in America." Click here for instant access to this free report.

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

Add Multi-Fineline Electronix to My Watchlist.

J.C. Penney Keeps Being J.C. Penney -- to the Detriment of Investors

Vodafone Group No Closer to Settling Indian Tax Dispute

Vodafone's  (LSE: VOD  ) (NASDAQ: VOD  )  tax dispute in India isn't looking like it's going away any time soon.

Following a visit to the country from prime minister David Cameron back in February, India's finance minister Palaniappan Chidambaram had said that the government will seek advice from the Cabinet on its ongoing tax dispute with the telecommunications company, and consider its offer for settlement.

But the Financial Times reports that "little progress has since been made" according to people familiar with the situation, despite Chidambaram previously stating that the matter could be concluded before April's annual budget, and is now "highly unlikely" to be resolved until after India's national election in 2014.

The case dates back to early last year, when the country amended its income tax law to enable reimposition of taxes on overseas deals involving local assets, retrospectively affecting Vodafone's stake in Indian telecommunications company Hutchinson Essar that it took in 2007.

The FT highlighted "a series of legal and political barriers" that have obstructed a deal specific to Vodafone, or a widespread reversal of the controversial income tax law that was brought in, and that India's finance ministry has yet to reply to a letter from Vodafone concerning the case.

As this rolls on, investors' confidence in the country continues to diminish. But if you invest for income and are looking for more security with a company whose interests are closer to home, you may wish to read this exclusive free in-depth report. The FTSE 100 company in question offers a 5.7% income, and might be worth 850 pence versus around 815 pence currently. Just click here to download the report -- it's absolutely free.

Pentagon Awards $7 Billion in Green Energy Contracts

After a slow start to the week Monday, the Department of Defense kicked its contracts-awarding machine into high gear Tuesday. In the space of 16 short contracts, the Pentagon doled out more than $8.3 billion in new contracts in a single day.

The bulk of these awards came in the form of a single multiple-award, task-order contract to be shared among several energy companies:

Constellation Energy Partners LLC's (NYSEMKT: CEP  ) Constellation NewEnergy subsidiary Privately held ECC Renewables LLC Enel Green Power North America, a subsidiary of Italy's Enel SpA LTC Federal LLC Siemens' (NYSE: SI  ) Government Technologies unit

These five firms are now authorized to bid for individual task orders under an umbrella contract for the procurement of renewable and alternative energy from facilities that are designed, financed, constructed, operated and maintained by private companies on private land under the jurisdiction of the Department of Defense. The ceiling value on this contract is $7 billion, thus accounting for 84% of the value of all Pentagon contracts awarded yesterday.

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Why Chemed Shares Were Walloped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Chemed (NYSE: CHE  ) , the nation's largest for-profit hospice care provider, nosedived 24% after the company announced the receipt of a false claims action complaint by the U.S. government.

So what: According to the U.S. government complaint filed against Chemed in Western Missouri, since as early as 2002 the company may have submitted false claims to the Medicare program by billing Medicare patients for crisis care services when they weren't eligible, and admitting patients who weren't eligible for the Medicare hospice benefit based on their life expectancy. The lawsuit seeks monetary compensation and interest while Chemed insists it will defend the lawsuit "vigorously."

Now what: Get out the yellow caution tape! Until further notice, I'd consider Chemed completely off limits. Government lawsuits like this often end in settlements long before they go to trial, but any sort of settlement here could be a damaging blow to Chemed's reputation. Until we know more -- and it could be a while -- I feel you ought to stay far away from this murky situation.

Craving more input? Start by adding Chemed to your free and personalized watchlist so you can keep up on the latest news with the company.

While you can certainly make huge gains in hospice care providers like Chemed, 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.

Does the New "Arrested Development" Make Netflix Stock a Buy?

The Bluths are back on May 26, and that's good news for owners of Netflix (NASDAQ: NFLX  ) stock. The company saw its worldwide streaming subscriber base jump 3 million in the first quarter thanks to the lure of House of Cards, which still rates 4.5 out of 5 stars from the more than 890,000 Netflix members who've watched the show.

Importantly, Netflix has a full slate of Original Series on the horizon and in development. Jenji Kohan's Orange Is the New Black debuts in July. Animated series Turbo: F.A.S.T. (Fast Action Stunt Team) arrives in December, followed by Narcos, Sense8, and the second season of House of Cards in 2014. Restarted series such as AMC Networks (NASDAQ: AMCX  ) thriller The Killing also add heft, says Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova in the following interview with the Fool's Erin Miller.

While Netflix stock isn't cheap at more than 500 times trailing earnings, this business is still in the early stages of global disruption. Subscribers and viewership matter more right now. With Original Series, Netflix is getting plenty of both. Don't be afraid to nibble on weakness, Tim says.

Do you agree? Let us know what you think of Netflix's Original Series and whether you'd buy, sell, or short Netflix stock at current prices

The investing case for Netflix has become complicated by competition and the streaming sensation's global ambitions. That's why our analysts have created a premium research report to address the issues surrounding the business. Click here to get your copy and we'll tell you whether the stock is a fit for your portfolio now.

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More Expert Advice from The Motley Fool

The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.

Why Fossil Shares Shot Higher

Do Medtronic's Layoffs Raise a Red Flag?

The medical device industry as a whole is under fire. Pricing pressures, the ongoing European recession, and tough competition have all come together to hit revenues at leading device makers. Medtronic (NYSE: MDT  ) hasn't been immune to those damages as the largest pure medical device maker, and its spine business -- its second-largest segment  by sales -- has seen revenue fall 5% over the last nine months as a result.

What's Medtronic's response? The company plans to cut 230 jobs at its spine business and slash costs by 5% in order to compensate for the falling sales. With other companies in the industry also seeing spine revenue lagging -- Stryker's (NYSE: SYK  ) own spine sales fell 4% in 2012 -- will this measure be enough? Motley Fool contributor Dan Carroll and health care analyst Max Macaluso discuss this question and more in the video below.

While you can certainly make huge gains in biotech and pharmaceuticals, 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.

Hydraulic Fracturing Uses Way Too Much Water

How to Handle the Dangers of DIY Investing

Wall Street devoutly wishes you to believe that you need professional help to manage your money. But most investors prefer to go it alone.

A survey earlier this year from the Deloitte Center for Financial Services looked at the state of the retirement planning industry in America. When asked about getting professional help for their retirement planning, 57 percent of those surveyed said they were simply more comfortable handling their retirement planning on their own. Another 38 percent saying that they don't actually advice from professionals, while 29 percent don't trust advisors to objectively represent their interests.

You can practically hear the collective cry of professional money managers across the country: "DIY investing? But how are we going to make a living off that?!"

Deloitte has an idea: One of the conclusions that the survey made was that financial advisors should target do-it-yourself investors with marketing campaigns about the dangers of going it on their own with their retirement savings.

Let's take a look at some common mistakes investors make, with an eye toward seeing whether professional advice can help prevent them.

1. Being Too Conservative

One of the biggest mistakes retirement investors make is to invest too conservatively. When stocks have fallen, they're too scared to buy into the market. Yet at times like now when stocks are high, they fear that the market is too expensive and that a downturn is imminent.

Despite their greater risk, stocks provide much better opportunities for growth than alternatives like bonds and cash investments. For those with years or even decades to go before retirement, investing in stocks gives you the best chance to see your money grow enough to meet your long-term financial goals. Finding the right mix of investments is certainly something you can do on your own with a little research.

2. Chasing Performance

Retirement investors who embrace stocks often make another mistake: paying too much attention to past performance. Buying the latest hot stock or sector of the market can be extremely tempting, but by the time an investment has done well enough to reach the high-performance radar screen, it has often already seen most of its growth opportunity play out. Unfortunately, this is also a trap that many professional brokers fall for, recommending the latest hot thing to clients even though the upside potential isn't there anymore.

The better choice is to look among stocks or investments that done well. Often, there will be good reasons for that bad performance, and you'll want to stay away from those investments. But some beaten-down stocks have far stronger future growth potential than high-flying investments that investors have already discovered.

3. Failing to Plan for Worst-Case Scenarios

People planning for their own retirement often end up focusing solely on investing. That's a key component of financial security, but it's far from the only one.

Another major factor is insurance protection, with needs like supplemental Medicare and long-term care insurance playing a vital role in keeping retirement costs down and helping preserve your nest egg as long as possible. Estate planning is also a key element of a successful retirement plan in order to ensure your family is taken care of after your death and that your financial affairs will be kept in order if you face a serious illness or injury.

Here, it's a lot harder to do your own legwork with insurance and estate planning than it is with investments. Insurance almost always requires contact with professional salespeople, and although do-it-yourself legal documents are available, personal attention yields a better-tailored plan.

4. Ignoring Taxes

Do-it-yourself investors sometimes ignore the vital role that tax planning can play in handling investments. For instance, many investors gravitate toward short-term investment plays, looking to make a big score quickly. Yet high tax rates on short-term capital gains can take half or more of those gains away when you consider both federal and state taxes.

By being smart about not only using tax-favored accounts like IRAs and 401(k)s but making the of them, you can greatly improve your after-tax returns. If you ignore the tax implications of your actions, you could easily find that the IRS benefits from your best investment ideas as much as you do yourself. So if you find yourself facing a complex tax situation any given year, it may be worth spending a few hundred dollars for the advice of a tax professional who can help you deal with the previous year's return, but also give you advice on how to best proceed in the future.

Get Help Where and When You Need It

Of course, what financial professionals fail to point out is that they're far from perfect in handling these potential pitfall areas. Few brokers have the training to provide in-depth legal or tax guidance, and they're often prone to conflicts of interest on the investment and insurance front that can put you into financial products that aren't the best available.

So don't take the Deloitte survey results as meaning you should give up on handling your own finances. By being aware of common mistakes like these, you'll greatly improve your odds of avoiding them.

Maybe China Mobile Doesn't Need Apple's iPhone After All

There's been an awful lot of talk over the past few years about how badly Apple (NASDAQ: AAPL  ) and China Mobile (NYSE: CHL  ) need each other. The iPhone maker wants access to the largest mobile subscriber base in the world, while the No. 1 Chinese carrier wants a flagship device that gulps down 3G data.

While China Mobile has never officially offered the device, the two smaller carriers do. China Unicom (NYSE: CHU  ) was the first Chinese iPhone carrier in 2009, and China Telecom (NYSE: CHA  ) followed suit in 2012. China Unicom and China Telecom have been consistently chipping away at China Mobile's lead in the lucrative market for 3G subscribers, a trend that has widely been attributable in part to the iPhone.

However, China Mobile has come roaring back in the first quarter without the iPhone's help and now has 41% of the market. Maybe the carrier doesn't actually need Apple.

Sources: China Mobile, China Unicom, and China Telecom.

China Mobile's gains in 3G come as the company continues to invest heavily in beefing up its 3G network. Simultaneously, the carrier is focusing on pushing low-cost 3G smartphones made by local OEMs like ZTE, Huawei, and Lenovo. China Mobile has historically had inferior 3G penetration relative to its rivals, so just migrating existing 2G subscribers to 3G can translate into meaningful 3G share gains, even if the company's overall subscriber base isn't growing as quickly.

Investors will notice a sharp uptick in 3G penetration over the past few months.

Source: China Mobile.

These initiatives combined are helping China Mobile expand its lead over China Unicom and China Telecom.

At the same time, just because China Mobile may not feel like it needs the iPhone anymore doesn't mean it won't benefit from pairing with Apple. If anything, China Mobile now has another bargaining chip at the negotiating table.

Investors are expecting Apple to release an affordable iPhone that's compatible with China Mobile's network this year. An affordable iPhone would help China Mobile strengthen its momentum even more.

There's a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on reasons to buy and reasons to sell Apple, and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.

The Dow's 5 Most Hated Stocks

Since the Dow Jones Industrial Average (DJINDICES: ^DJI  ) hit an all-time record high on Friday on the heels of a better-than-expected jobs report, there's no shortage of optimists. With the symbol of American business strength putting the lost decade in the rearview mirror, low lending rates and an improving jobs environment are encouraging businesses and consumers to slowly become more liberal with their spending habits.

However, not everyone agrees that the market is in better shape than when the Dow last hit all-time highs in 2007. In fact, some data -- especially second-quarter enterprise revenue data -- would suggest that cost-cutting, rather than top-line growth, is fueling this rally. For those skeptics, I give you the Dow's five most hated stocks. These are the five companies that carry the highest short interest within the Dow Jones index.

As I did last month, I will examine why these companies draw the short-sellers and determine whether or not that short interest is warranted.

Company

Short Interest as a % of Shares Outstanding

Alcoa (NYSE: AA  )	8.29%
Intel (NASDAQ: INTC  )	4.74%
DuPont (NYSE: DD  )	3.34%
Johnson & Johnson (NYSE: JNJ  )	3.2%
Hewlett-Packard	2.85%

Source: S&P Capital IQ.

Alcoa
Why are investors shorting Alcoa?

Alcoa finds itself with significantly more short interest than it had last month as short-sellers continue to bet against a sustained rebound in aluminum prices and demand. Alcoa has resorted to idling capacity in order to reduce expenses, but it nevertheless stuck to its guns in its first-quarter results by topping EPS expectations and continuing to forecast 7% global aluminum demand growth this year.

Is this short interest warranted?

This one is tough to call. Between Alcoa's idle capacity and the fact that China's economy is growing at a much slower pace than in the previous 30 years, there are certainly ample reasons for investors to remain cautious. However, the outlook for aluminum demand over the long run appears healthy, and the company could turn out to be quite a bargain if other emerging-market regions like Eastern Europe or South America see a big pick-up in demand.

Intel
Why are investors shorting Intel?

Although it's a cyclical company that can deal with the natural ebb and flow of the technology cycle, nearly all of Intel's pessimism surrounds the continued weakness in PC sales. During the first quarter, according to research firm IDC, PC sales fell 14%, which means Intel needs to invest heavily in research and development in order to rapidly improve and introduce its mobile and cloud chip offerings if it wants to stay ahead of the curve.

Is this short interest warranted?

I'd say yes and no. Over the short run, Intel will struggle with lower margins as higher expenses from R&D eat into its bottom line and PC sales continue to weaken. Then again, Intel is positioning itself to be a leader in cloud-based server hardware and is gearing up to derive 30% of its revenue from its cloud-based hardware segment within the next decade. The company's ability to generate significant cash flow would be enough to deter me as a short-seller.

DuPont
Why are investors shorting DuPont?

Despite a small drop in short interest, DuPont is still attracting its fair share of pessimists who feel that the company's chemical business is too intricately tied to a fragile European and U.S. economy. The company's first-quarter report delivered a better-than-doubling in net income, but that was boosted by the $1.9 billion sale of its performance-coating unit. Strip that out, and volume rose by just 2% as Europe dragged on overall performance.

Is this short interest warranted?

I swear I'm not being willfully ambiguous, but "definitely maybe" is yet again the answer. In the near term, DuPont will struggle to boost its bottom line as Europe remains weak and China's GDP growth runs below the norm. Over the long run, though, a rebound in China and Europe and the increasing need for food will help boost DuPont's chemicals and agricultural segments. The "X factor" is whether or not the continued rebound in the U.S. housing market can provide a more immediate boon to DuPont's share price.

Johnson & Johnson
Why are investors shorting Johnson & Johnson?

A bet against Johnson & Johnson is primarily a bet that the struggles in Europe will continue and that J&J's growth rate won't be sufficient to justify its forward P/E of 15. J&J's first-quarter report, however, would suggest otherwise: Domestic sales rose 11.2%, international sales ticked up 6.3% despite a negative 2.4% currency headwind, and adjusted EPS added 5% over the year-ago period.

Is this short interest warranted?

Of all the most shorted Dow components, this is the biggest head-scratcher by far. J&J purchased Synthes last year for $19.7 billion to expand its medical-device presence in rapidly growing markets (taking care of international growth). Earlier this year, it received approval from the Food and Drug Administration for a revolutionary new class of type 2 diabetes drug, Invokana (hello, organic growth!). Seriously? Investors want to bet against this? Dream on! 

Hewlett-Packard
Why are investors shorting Hewlett-Packard?

On the flip side, HP has given short-sellers a laundry list of reasons to dislike the company. Among others, its most recent quarterly report showed revenue declines in all five major segments, it recently shed 27,000 jobs, and an IDC report last week showed an 18.9% drop in HP server shipments in North America in the first quarter compared to a 9.9% gain for struggling Dell.

Is this short interest warranted?

Everyone loves a turnaround story, but HP is a long way from having its plan fully implemented. CEO Meg Whitman is certainly an amazing cost-cutter, but I have yet to see what innovations HP will bring to the table to help differentiate its hardware from everyone else's. Sure, HP is cheap on a forward-earnings basis, but it could get considerably more expensive if all of its business segments keep going in reverse. Here's a stock the short-sellers have a firm grasp of.

Do these five Dow components deserve this pessimism? Share your thoughts in the comments section below.

Is it time to put your pedal to the metal?
Materials industries are traditionally known for their high barriers to entry, and the aluminum industry is no exception. Controlling about 15% of global production in this highly consolidated industry, Alcoa is in prime position to take advantage of growth that some expect will lead to total industry revenue approaching $160 billion by 2017. Based on this prospect and several other company-specific factors, Alcoa is certainly worth a closer look. For a Foolish investment perspective on this global giant, simply click here now to get started.

Is North Korea's Latest Missile Progress a Serious Threat to America?

"These advances in ballistic-missile delivery systems, coupled with developments in nuclear technology ... are in line with North Korea's stated objective of being able to strike the U.S. homeland."

That report from the Pentagon brings some chilling news: North Korea is getting closer to its goal of building a nuclear missile capable of reaching the continental United States. Although the report didn't give an exact time of when such a threat would come online, it did say it could happen "soon." 

While that news sounds ominous, is it really something America should be concerned about? In the grand scheme of things, is North Korea a serious threat, or simply a boon for defense contractors and their stocks?

Source: David Shankbone, via Wikimedia Commons. 

The tantrum heard 'round the world
North Korea hasn't been on good terms with America for some time, but the tension that was already there skyrocketed in December, when North Korea launched a satellite into space -- proof that North Korea was actively pursuing long-range missile capabilities.  

Following the launch, and the resulting sanctions from the United Nations, North Korea's leader, Kim Jong-un, grew more belligerent by responding to increased sanctions with escalating threats, including promises to destroy America and South Korea.  

Understandably, South Korea responded by purchasing 30 attack helicopters from Boeing (NYSE: BA  ) ; actively pursuing fighter-jet options from Lockheed Martin (NYSE: LMT  ) , BAE Systems (NASDAQOTH: BAESY  ) , and Boeing; and carrying out military drills, despite protests from North Korea.  

A barking Chihuahua?
Yes, the threats from North Korea sound bad, and South Korea's response makes it sound as if an out-and-out war could break out any second -- and that's partly true; reason and sanity aren't exactly Kim's strong suit. But how likely is it that such an attack would prove serious to America? Not very, I'd argue. North Korea's pursuit of a nuclear weapon is a threat; don't get me wrong, but America has been armed with nukes for years.

Moreover, thanks to Northrop Grumman's (NYSE: NOC  ) Global Hawk, Boeing's Ground-Based Interceptors, Raytheon's (NYSE: RTN  ) SM-3 defense system, and Lockheed's Aegis Missile Defense System, America's powerhouse of missile technology would be pitted against a nation that's still learning how to fire a rocket -- think of it as a Chihuahua trying to fight a German shepherd: One bite, and the Chihuahua's a goner.  

So what's the big deal?
The idea that North Korea could destroy America is laughable, but that doesn't mean the threats should go unchecked. South Korea's military prowess, although superior to North Korea's, is not on the same level with the United States. More importantly, a war between the two countries wouldn't be pretty. Both have their respective backers -- the U.S. is allied with South Korea; China is allied with North Korea -- and though China has denounced Kim's threats and North Korea's pursuit of a nuclear weapon, they have been allies for a long time.  

Consequently, while America may not see North Korea as a serious threat to American soil, it is a threat to the Asian region, and it could prove to be a catalyst for escalated tensions with China. As such, it's a situation that deserves to be closely monitored, although I think building a bomb shelter in the backyard is probably a bit excessive. And as bad as the situation could be, Kim Jong-un and North Korea are helping defense contractors at a tough financial time. So in some ways, we're looking at a glass-half-full situation.

Boeing operates as a major player in a multitrillion-dollar market in which the opportunities and responsibilities are absolutely massive. However, emerging competitors and the company's execution problems have investors wondering whether Boeing will live up to its shareholder responsibilities. In our premium research report on the company, two of The Motley Fool's best minds on industrials have collaborated to provide investors with the key, must-know issues surrounding Boeing. They'll be updating the report as key news hits, so don't miss out -- simply click here now to claim your copy today.

Why Goldman Sachs' Earnings Bode Poorly for the Economy

Earlier this week, the nation's largest independent investment bank, Goldman Sachs (NYSE: GS  ) , reported earnings for the first quarter of 2013. At first glance, the results seemed to bode well for the economy, as both its top and bottom lines expanded. However, upon closer inspection, nothing could be further from the truth. In the video below, Motley Fool contributor John Maxfield walks readers through why this is so.

During the financial crisis, Goldman Sachs did so well pivoting to avoid the worst of the fallout that it had to downplay its success to duck public ire and conspiracy theories. Today, Goldman is still arguably the powerhouse global financial name, and yet its stock trades at a valuation of less than half what it fetched prior to the crisis. Does this make Goldman one of the best opportunities in the market today? To answer that question, I invite you to check out The Motley Fool's special report on the bank. In it, Fool banking expert Matt Koppenheffer uncovers the key issues facing Goldman, including three specific areas Goldman investors must watch. To get access to this report, just click here.

[3] [4] [6] [7] [9] [10] [12] [15] [16] [18] [19] [22] 5 Best Forestry Stocks For 2014

tags:,Forestry,Healthcare,DPH.L,Financial,STRS,Canadian,Insurance,SLF,Services,BBW,LPSB,

The economy and financial markets are really complicated. But there's always an easy fix for complicated things: Simplify!

Right now, the simplified logic on what the Federal Reserve is doing to the economy goes like this: By buying up hundreds of billions of dollars of Treasury bonds, the Fed is pushing interest rates down. And by scooping up those Treasury bonds, the Fed is financing the federal government's massive budget deficits.

Both are true, but only kind of. Simplifying doesn't tell us the whole story. �

Take interest rates.

The Fed has�played around with quantitative easing for the last four and half years. But during that time it's gone in fits and starts, engaging in QE, then stopping, then starting up again. There have been several periods since 2008 when the Fed has purchased huge amounts of Treasuries and mortgage-backed securities, and several periods when it purchased no bonds all, leaving the market to itself.

5 Best Blue Chip Stocks To Buy Right Now: Sun Life Financial Inc.(SLF)

Sun Life Financial Inc., together with its subsidiaries, provides various life and health insurance, savings, investment management, retirement, and pension products and services to individuals and corporate customers. It offers individual life insurance policies, including individual term life, universal life, critical illness, disability, accident, and accidental death and dismemberment insurance policies; and group life insurance policies. The company also provides individual health insurance, long-term care insurance, group health benefits, dental benefits, and group insurance; and various individual and group annuity, retirement, and investment income products and services, such as mutual and pooled funds, variable and fixed annuities, savings, retirement and pension plans, and education savings. In addition, it offers asset management services for corporate retirement plans, separate accounts, public or government funds, and insurance company assets to institutional clients; and advisory services to individual investors. Further, the company provides run-off reinsurance services. Sun Life Financial Inc. distributes its products through direct sales agents, independent and managing general agents, financial intermediaries, broker-dealers, banks, pension and benefit consultants, and other third-party marketing organizations. The company operates primarily in Bermuda, Canada, China, Hong Kong, India, Indonesia, Ireland, the Philippines, the United States, and the United Kingdom. Sun Life Financial Inc. was founded in 1999 and is based in Toronto, Canada.

5 Best Forestry Stocks For 2014: LaPorte Bancorp Inc.(LPSB)

LaPorte Bancorp, Inc. operates as the holding company for the The LaPorte Savings Bank, which provides commercial banking services to individuals and small businesses. The company?s deposits include savings accounts, health savings accounts, NOW accounts, checking accounts, money market accounts, certificates of deposit, and IRAs, as well as commercial checking accounts for businesses. Its lending portfolio includes one to four family residential loans, mortgage warehouse loans, commercial real estate loans, construction and land loans, commercial loans, home equity loans and lines of credit, and consumer and other loans. The company also offers trust services. It operates through eight branches in LaPorte and Porter Counties, Indiana. The company is based in LaPorte, Indiana. LaPorte Bancorp, Inc. operates as a subsidiary of LaPorte Savings Bank, MHC.

Is Energy Merger-and-Acquisition Activity Set to Explode?

Last year was a record year for mergers and acquisitions within the oil and gas industry. So far, 2013 is off to a fairly decent start, though we're off from the torrid pace seen at the end of 2012. Instead, we're seeing complex deals and joint ventures taking center stage. Is this a sign of things to come, or are we primed for an M&A boom?

Let's make a deal
So far this year, according to consulting firm PricewaterhouseCoopers, U.S.-based companies have spent $27 billion on M&A, which is slightly ahead of last year's pace of $25.7 deals in the first quarter. Still, we've seen a massive 52% drop-off from the fourth quarter of last year, as many companies sold out before we went over the fiscal cliff. We also haven't seen too many headline-making deals.

One of the largest deals this year, and the one that could make an interesting new trend had LINN Energy (NASDAQ: LINE  ) combine with its affiliate LinnCo (NASDAQ: LNCO  ) to purchase Berry Petroleum (NYSE: BRY  ) in an all-stock deal valued at $4.3 billion. The deal was unique because LINN is structured like an MLP while Berry is a C-Corp. To get the deal done, LINN used its newly public LinnCo, which is a C-Corp and whose only assets are units of LINN, to merge with Berry. Once the merger closes, LINN will trade its units to LinnCo for Berry's operating assets. LINN believes this new structure could be the new deal standard as it looks to continue to consolidate mature oil and gas assets in the United States.  

Rich foreign buyers
The most interested buyers right now are foreign buyers. They represent one of the few buyers with the financial resources and the desire to acquire assets at a premium. That's one reason one of the quarter's larger deals saw Chesapeake Energy (NYSE: CHK  ) enter into a $1.02 billion joint venture agreement with China's Sinopec. The deal was for a 50% interest in 850,000 of Chesapeake's acres in the Mississippi Lime. This deal is one of the many in recent years that saw foreign oil companies purchase oil and gas assets in the United States. Because of the capital required to explore shale resources, we're seeing more companies explore foreign joint ventures as many U.S.-based producers have seen their own capital wells run dry.  

Outlook
Looking ahead, we'll see similar activity centered on shale ventures, with the Utica potentially seeing the most activity. Chesapeake has already made it known that it would like to unload around 100,000 of its acres in the Utica. Meanwhile, Devon Energy (NYSE: DVN  ) is looking to completely exit from the Utica. Devon has already packaged a portion of its Utica acreage, along with four other emerging plays, into a joint venture package with Sinopec. While these two energy giants are exiting the Utica, it still appears to be a top-tier play; it's just not the oil-levered play those two were hoping it would become.

While those two are looking to unload assets, other companies like LINN are looking to continue to acquire. The difference here is that LINN is looking for mature, cash-flowing assets while those being offered by Devon and Chesapeake still need to be developed. LINN sees a robust market for mature assets, and on the company's recent conference call, it noted that while things have been slow, it appears that activity is about to pick up. Specifically, in terms of M&A activity, CEO Mark Ellis point out:

We've seen it pick up. Actually on the asset side, I think we mentioned in the last call it kind of got off to a slow start. We still felt like it would be a pretty robust year and that we're actually starting to see that come to fruition where there is a number of things out there right now, and some pretty sizable things as well, that are in the marketplace, which is encouraging. And as you know, we continue to monitor the C-Corp side and look pretty hard there. So we think it's a pretty good market.

It would appear that we'll see a fair amount of M&A activity over the next few months. Not only will foreign buyers probably pick up additional shale assets, but we'll probably also see a couple of large asset sales or mergers announced as the weather continues to heat up. While it's useless to speculate as to what deals will get done, it's still important to watch overall deal flow. However, with so many organic growth opportunities for energy companies these days, we probably won't see too many headline-making, transformational mergers take place. 

Chesapeake has been a busy deal maker over the past few years, as it's been jettisoning assets in order to pay down debt while funding its drilling program. This transition is one reasons energy investors would be hard-pressed to find another company trading at a deeper discount than Chesapeake Energy. Its share price depreciated after negative news surfaced concerning the company's management and spiraling debt picture. While the debt issues still persist, giant steps have been taken to help mitigate the problems. To learn more about Chesapeake and its enormous potential, you're invited to check out The Motley Fool's brand-new premium report on the company. Simply click here now to access your copy.

What's So Great About T-Mobile's Merger With MetroPCS?

The wireless industry in America is ruled by AT&T (NYSE: T  ) ,  Verizon (NYSE: VZ  ) , and a handful of much smaller networks fight for scraps from the ruling duo's table. A wave of consolidation can change all of that.

In this video, Fool contributor Anders Bylund explains why MetroPCS (NYSE: PCS  ) merging with T-Mobile USA is good for both consumers and the industry at large -- though he's actually more interested in what will become of third-largest service provider Sprint Nextel (NYSE: S  ) .

 

The mobile revolution is still in its infancy, but with so many different companies it can be daunting to know how to profit in the space. Fortunately, The Motley Fool has released a free report on mobile named "The Next Trillion-Dollar Revolution" that tells you how. The report describes why this seismic shift will dwarf any other technology revolution seen before it and also names the company at the forefront of the trend. You can access this report today by clicking here -- it's free.

Is This Apple's Biggest Problem in China?

Apple (NASDAQ: AAPL  ) has not made it a secret that China is a critical market for the company and one that it intends to focus on. Despite this reality, the iPhone 5 is not the top-seller there and faces stiff competition from local manufacturers including Samsung and Lenovo. As Samsung prepares to release its own operating system to compete with Google (NASDAQ: GOOG  ) Android and Microsoft (NASDAQ: MSFT  ) Windows, Asia promises to be an exciting landscape for smartphones this year.

In the video below, Fool.com contributor Doug Ehrman discusses one of the biggest threats to Apple and how it impacts the smartphone wars.

There's no doubt that Apple is at the center of technology's largest revolution ever, and that longtime shareholders have been handsomely rewarded with over 1,000% gains. However, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple, and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.

Best Cheap Stocks For 2014

There are many things to consider when looking for a good dividend stock. A payout that's sizable enough to make a difference over time is nice; so is the potential for the stock's overall price to go up; and most important, the dividend needs to be sustainable.

To measure these characteristics, I've included a number of metrics below.

• The dividend yield tells you how much a stock is paying out relative to its price.
• The PEG ratio gives a rough estimate of how over- or undervalued a stock is. If it's above 1, the stock is considered overvalued; below, and it's generally undervalued.
• The payout ratio from free cash flow lets you know the percentage of money it brings in that it's paying out to shareholders. Anything above 100%, and its paying out more than it takes out, usually a recipe for disaster.

So here's how 2013's candidates stack up.

Best Cheap Stocks For 2014: Horace Mann Educators Corporation(HMN)

Horace Mann Educators Corporation, through its subsidiaries, operates as a multiline insurance company in the United States. The company underwrites and markets personal lines of property and casualty insurance, retirement annuity, and life insurance products. Its products include private passenger automobile and homeowner?s insurance coverage; tax-qualified individual and group annuities in fixed account and combination contracts; and individual and joint whole and term life insurance products. The company offers its products primarily to K-12 teachers, school administrators, education support personnel, and other employees of public schools and their families. It markets its products through its sales force, as well as through independent agents. Horace Mann Educators Corporation was founded in 1945 and is based in Springfield, Illinois.

Advisors' Opinion:

• [By Chris Stuart]

  Horace Mann Educators(HMN), which provides car and homeowners insurance for teachers and other educators, recently lowered its full-year profit forecast because of a spike in tornado- and storm-related disasters during April and May. Management reduced 2011 EPS guidance to $1.10-$1.30 from a previous $1.75-$1.95.

  With the shares down 10% over the past three months, investors might want to consider the recent dislocation as a buying opportunity. At the midrange of restated guidance, the shares are trading for 12.8 times fiscal 2011 estimates and, more importantly, at just 0.7 times book value. TheStreet Ratings has a $20 price target on Horace Mann.

Best Cheap Stocks For 2014: Cardero Resource Corporation(CDY)

Cardero Resource Corp., together with its subsidiaries, engages in the acquisition, exploration, and development of mineral properties in Mexico, Peru, Argentina, the United States, and Canada. The company holds a 75% interest in the Carbon Creek deposit, a metallurgical coal development project located in the Peace River Coal Field of northeast British Columbia, Canada. It also has an option to acquire 100% interest in the Pampa El Toro project, an iron sands deposit, located in southern Peru; option to acquire up to an 85% interest in the Longnose property in St. Louis county, northeastern Minnesota; and 100% leasehold interest in the Titac property, located in St. Louis county, northeastern Minnesota. The company was formerly known as Sun Devil Gold Corp. and changed its name to Cardero Resource Corp. in May 1999. Cardero Resource Corp. was founded in 1985 and is headquartered in Vancouver, Canada.

Advisors' Opinion:

• [By Louis]

  Cardero Resource Corp.(CDY) is down about 18% since the start of 2011, but shares are still up 50% in the past six months. Currently at $1.80, this mineral exploration company is a penny stock worth buying with a 52-week range of $1 to $2.37.

Best Cheap Stocks For 2014: Advance Auto Parts Inc(AAP)

Advance Auto Parts, Inc., through its subsidiaries, operates as a retailer of automotive aftermarket parts, accessories, batteries, and maintenance items. It operates in two segments, Advance Auto Parts (AAP) and Autopart International (AI). The AAP segment operates stores, which primarily offer auto parts, including alternators, batteries, chassis parts, clutches, engines and engine parts, radiators, starters, transmissions, and water pumps; accessories comprising floor mats, mirrors, vent shades, MP3 and cell phone accessories, and seat and steering wheel covers; chemicals consisting of antifreeze, freon, fuel additives, and car washes and waxes; and oil and other automotive petroleum products. This segment also provides battery and wiper installation, battery charging, check engine light reading, electrical system testing, video clinics and project brochures, loaner tool programs, and oil and battery recycling services; and sells its products through online. The AI segm ent operates stores that offer replacement parts for domestic and imported cars, and light trucks to customers in northeast and mid-Atlantic regions, as well as to warehouse distributors and jobbers in North America. As of January 1, 2011, the company operated 3,369 AAP stores, including 3,343 stores located in the northeastern, southeastern, and Midwestern regions of the United States under the Advance Auto Parts and Advance Discount Auto Parts trade names; 26 stores situated in Puerto Rico and the Virgin Islands under the Advance Auto Parts and Western Auto trade names; and 194 stores under the Autopart International trade name in the United States. It serves do-it-yourself, do-it-for-me, or commercial customers. The company was founded in 1929 and is based in Roanoke, Virginia.

Advisors' Opinion:

• [By Vatalyst]

  Advance Auto Parts (AAP) is the second largest parts retailer in the U.S. The common stock currently trades at a price to earnings ratio sits at 12.5, below its historical average of 16 and industry average of 15.7.

  Typical of Wall Street short term thinking, the madding crowd fled this stock in May, due to weak first quarter 2011 comparable store sales gain of 1.4% versus an 8.9% gain during December 2010. Price to book ratio is 4.57 whilst price to cash flow sits at 7.70, well below the industry average of 11.2.

Best Cheap Stocks For 2014: Hewlett-Packard Company(HPQ)

Hewlett-Packard Company and its subsidiaries provide products, technologies, software, solutions, and services to individual consumers and small- and medium-sized businesses (SMBs), as well as to the government, health, and education sectors worldwide. Its Personal Systems Group segment offers commercial personal computers (PCs), consumer PCs, workstations, calculators and other related accessories, and software and services for the commercial and consumer markets. The company?s Services segment provides consulting, outsourcing, and technology services to infrastructure, applications, and business process domains. Its Imaging and Printing Group segment provides consumer and commercial printer hardware, supplies, media, and scanning devices, such as inkjet and Web solutions, laser jet and enterprise solutions, managed enterprise solutions, graphics solutions, and printer supplies. The company?s Enterprise Servers, Storage, and Networking segment offers industry standard s ervers, business critical systems, storage platforms, and networking products, including switches, routers, wireless LAN, and TippingPoint network security products. Its HP Software segment provides enterprise IT management software, information management solutions, and security intelligence/risk management solutions. The company?s HP Financial Services segment offers leasing, financing, utility programs, and asset recovery services; and financial asset management services for enterprise customers, as well as specialized financial services to SMBs, and educational and governmental entities. Hewlett-Packard Company also provides business intelligence solutions that enable businesses to standardize on consistent data management schemes, connect and share data across the enterprise, and apply analytics, as well as licenses its specific technology to third parties. The company was founded in 1939 and is headquartered in Palo Alto, California.

Advisors' Opinion:

• [By Jim Cramer]

  Nope, not the one to own in 2011. I think that HP has taken a step backward and is now ripe for the pickings of every other company in the space, whether it be . Accenture (ACN) on the consulting side or . EMC (EMC) on the server side or Oracle (ORCL) with Sun on the hardware and software side or Apple (AAPL) on the PC side. I just don't see this company doing anything this year, and I really don't understand the strategy or the vision, in part because of a new CEO who hasn't explained it yet and in part because of the old CEO who left on such a bad note. I don't see a pickup in earnings and I think that the stock could finish lower than it starts. Call it $40. I hope I am wrong because I think that 2011 will be a good year for tech in general, but not for this company.

• [By Smart Money]

  Forward P/E: 9.2.

   

  Five-year average forward P/E: 13.8.

  Discount to five-year average: 33%.

  As the world's biggest maker of personal computers and printers, Hewlett-Packard (HPQ) has two knocks against it -- neither of its major markets is particularly attractive these days, says Kim Caughey, senior analyst at Fort Pitt Capital Group in Pittsburgh.

  "In the PC market, HP is fighting deflation," Caughey says. "Next year's hardware is always going to be faster, better, cheaper."

  The Palo Alto, Calif., company's printer and printing business is suffering as companies downsize, she says; fewer workers translates into less printing.

  Even worse is what could happen to HP's margins as demand grows for tiny, cheap netbook computers. "I'm looking into people's pockets and I believe they will be sending their kids back to school with netbooks," says Caughey. "The (profit) margin on netbooks is terrible."

   

  That's part of the bigger problem with a company as consumer-focused as HP. If folks don't have the money, they can't spend it. For that reason, Caughey thinks Hewlett-Packard's shares, while valued at a low multiple, are unattractive.

• [By Jon C. Ogg]

  Hewlett-Packard Co. (NYSE: HPQ) was the worst story of all 30 DJIA stocks in 2013. Unfortunately, what was bad is expected to get worse in 2013. With a downside price target of $13.53, HP shares are now expected to fall just over 5%, even with this yielding 3.5% now. HP’s woes do not stop with the Autonomy acquisition woes. Meg Whitman has fired many employees but warned that a real turnaround might not take hold until all the way into 2016. We expect more asset sales and ultimately more layoffs. HP’s position was not helped out after it became known that famous short sellers are continuing to bet against this PC and IT-services giant.

Best Cheap Stocks For 2014: AeroVironment Inc.(AVAV)

AeroVironment, Inc. designs, develops, produces, and supports unmanned aircraft systems (UAS), and efficient energy systems for various industries and governmental agencies. Its UAS provide intelligence, surveillance, and reconnaissance, including real-time tactical reconnaissance, tracking, combat assessment, and geographic data to the small tactical unit or individual war fighter. The UAS wirelessly transmit critical live video and other information generated by their payload of electro-optical or infrared sensors directly to a hand-held ground control system, enabling the operator to view and capture images during the day or at night on a hand-held ground control unit. AeroVironment also provides spare equipment, alternative payload modules, batteries, chargers, repair services, and customer support for the UAS. In addition, the company produces industrial productivity and clean transportation solutions for commercial and government customers, develops potential clean t ransportation solutions, and performs contract engineering services; offers PosiCharge electric vehicle charging systems for industrial electric material handling fleets, electric vehicle charging systems for passenger and fleet vehicles, and power cycling and test systems for developers and manufacturers of plug-in electric and hybrid vehicles, as well as battery packs, electric motors, and fuel cells; and supplies power cycling and test systems to research and development organizations that focus on developing electric propulsion systems, electric generation systems, and electricity storage systems. It supplies its UAS primarily to the organizations within the United States department of defense. AeroVironment, Inc. was incorporated in 1971 and is headquartered in Monrovia, California.

Advisors' Opinion:

• [By Chris Stuart]

  AeroVironment(AVAV) sells unmanned, remote-control military aircraft and rapid-charging battery stations for electric vehicles.

  The stock has fallen due to concerns over U.S. defense budget cuts. According to Benchmark Research, the company should do well because of growth in its electric-vehicle-charging business. "We will see major deployment of electric-vehicle-charging infrastructure in the coming year to support multiple electric-vehicle introductions and the White House's target of 1 million EV by 2015."

  AeroVironment was recently named to a list of stocks by Goldman Sachs that have a 15% probability, or better, of being acquired. Shares of AeroVironment rocketed 20% Wednesday as quarterly earnings exceeded analysts' estimates. While the shares are not quite as attractive compared with when I first ran the screen June 20, they still have upside potential, given TheStreet Ratings $38 price target.

Best Cheap Stocks For 2014: Whole Foods Market Inc.(WFM)

Whole Foods Market, Inc. engages in the ownership and operation of natural and organic food supermarkets. The company offers produce, seafood, grocery, meat and poultry, bakery, prepared foods and catering, coffee and tea, nutritional supplements, and vitamins. It also provides specialty products, such as beer, wine, and cheese; body care and educational products, such as books; and floral, pet, and household products. As of February 9, 2011, the company operated 302 stores in the United States, Canada, and the United Kingdom. Whole Foods Market, Inc. was founded in 1978 and is headquartered in Austin, Texas.

Advisors' Opinion:

• [By Chris Stuart]

  Whole Foods Market(WFM) has turned in a lackluster performance over the past three months, with the shares down 6%, trailing the food-and-staples industry by over 7%. Investors, concerned about the sluggish economy, have avoided the company.

  But the news has been good, as the company issued a bright outlook for the remainder of 2011. At first glance, the shares don't look cheap. Based on the expectations from management for $1.87-$1.90 EPS for 2011, the stock trades at a P/E multiple of roughly 32 times 2011 earnings. But Bank of America-Merrill Lynch analysts argue the stock looks attractive and maintain a $68 price target.

  "We believe WFM's valuation is attractive given its strategy to improve its competitive price position and enhance its cost discipline, which broadens its growth prospects and supports an outlook for improving returns while lowering the company's operating risk profile," Merrill analysts say.

  TheStreet Ratings has a slightly more optimistic $77 price target on shares of Whole Foods Markets. Note that the shares jumped $4 on Tuesday, based on upbeat comments from the company's CEO, who said the natural-foods grocer is gaining market share and he is "feeling pretty bullish" about Whole Foods' future. Despite the gain, I would still consider an investment.

• [By James K. Glassman]

   Executives at Whole Foods seem to have learned from their past money mistakes. After pushing too fast for growth and acquiring Wild Oats for a pricey $565 million in 2007, the company needed to pull out of its debt with an infusion of cash from private equity firm Leonard Green. 
  
  Now, the company's keeping its powder dry and its cash cushion stuffed. The high-end grocer is ramping up growth again, but this time, without depleting its cash hoard; it plans to open 25 new stores in this fiscal year that ends in October and 28 to 32 the following year. The company raised its dividend in January by 4 cents, to 14 cents per share. The stock, at $94.46, yields 0.6%. 
  
  Whole Foods had a cash flow of $755 million last year, with capital expenditures of $167 million.

Best Cheap Stocks For 2014: Majesco Entertainment Company(COOL)

Majesco Entertainment Company develops and markets video game products primarily for family oriented mass-market consumers. The company publishes video games for various interactive entertainment hardware platforms, including Nintendo?s DS, DSi, and Wii; Sony?s PlayStation 3 and PlayStation Portable; Microsoft?s Xbox 360; and personal computers. It also publishes games for various digital platforms consisting of mobile platforms comprising iPhone, iPad, and iPod Touch, as well as online platforms, including Facebook. The company sells its products primarily to retail chains, specialty retail stores, video game rental outlets, and distributors. The company was founded in 1998 and is based in Edison, New Jersey.

Advisors' Opinion:

• [By Louis]

  Majesco Entertainment (NASDAQ: COOL) is an innovative provider of video games for the mass market, developing a wide range of titles for Sony’s PlayStation, Microsoft’s Xbox and Nintendo’s WII systems. On June 7, COOL announced that it had signed a contract with the NBA to begin development of an original video-game basketball franchise. The stock rose an impressive 32% over the next five trading days while the broader market sold off.

  However, the stock is down today after reporting weaker-than-expected second-quarter earnings last night, missing consensus earnings estimates by 2 cents. Majesco reported net revenues of $32.1 million for the second quarter ended April 30, 2011, compared with $10.9 million reported for the same period in the previous year. The company’s operating income for the second quarter was $5.3 million, compared with an operating loss of $1.6 million reported for the same period in the previous year. So treat this sell-off as a buying opportunity.

• [By McWillams]

  Majesco Entertainment makes video games mainly for the family-oriented, mass-market consumer.

  Majesco's incredible run this year started on Jan. 11 when the company announced it had shipped more than 500,000 copies of its Zumba Fitness video game title for the Wii, Xbox 360 and PlayStation 3. In late January, the company announced that it regained compliance with the Nasdaq's minimum bid price requirement for continued listing.

  In early March, shares of Majesco climbed higher after the company posted better-than-expected fiscal first-quarter financial results, with revenue jumping to $48.5 million from $29.2 million in the same period a year earlier.

  Current Share Price: $3.20 (March 29)

  First Quarter Total Return: 315%

  Analyst Ratings: Majesco garners a lone "buy" rating from Needham & Co. and a "neutral" rating from Wedbush. Coincidentally, both research firms have a $2.50 price target on the stock.

  TheStreet Ratings has a "hold" recommendation on Majesco Entertainment. The research report from March 20 says revenue growth, a largely solid financial position with reasonable debt levels and solid stock price performance are strengths that are countered by the company's weak cash flow from its operations.

Best Cheap Stocks For 2014: Horizon Lines Inc.(HRZ)

Horizon Lines, Inc., through its subsidiaries, provides container shipping and integrated logistics services. It ships a range of consumer and industrial items, such as refrigerated and non-refrigerated foodstuffs, household goods, auto parts, building materials, and other materials used in manufacturing. The company offers container shipping services to ports within the continental United States, Puerto Rico, Alaska, Hawaii, Guam, the U.S. Virgin Islands, and Micronesia. Its integrated logistics services comprise rail, truck brokerage, warehousing, distribution, expedited logistics, and non-vessel operating common carrier operations. Horizon Lines, Inc. also offers terminal services. The company operates terminals in Alaska, Hawaii, and Puerto Rico; contracts for terminal services in seven ports in the continental United States; and the ports in Guam, Yantian, and Xiamen, China, as well as Kaohsiung, Taiwan. In addition, it offers inland transportation services. As of Dec ember 20, 2009, the company owned or leased approximately 20 vessels and 18,500 cargo containers. Horizon Lines, Inc. serves consumer and industrial products companies, as well as various agencies of the U.S. government, including the Department of Defense and the U.S. Postal Service. The company was founded in 1956 and is based in Charlotte, North Carolina.

Advisors' Opinion:

• [By Hutchinson]

  Horizon Lines (NYSE: HRZ) is the largest oceangoing shipping company in the United States with a dominant market position along protected shipping lanes. One look at the steady resurgence in shipping demand, coupled with the company’s improving financials, and it seems the worst is behind them — making now the perfect time to scoop up this stock at a discount.

  HRZ is up almost 30% since September, and I expect it to continue moving higher. Recent data show more goods are being manufactured, and they need to be shipped. Horizon will be one of the biggest beneficiaries.

  Buy HRZ on pullbacks under $5.