Thursday, October 31, 2013

AT&T Inc. Eyes Vodafone Group Plc Takeover (T)

Telecom giant AT&T Inc. (T) is looking to make a big move after watching its main competitor, Verizon Wireless (VZ), turn in a big earnings win.

The strategy may actually involve a firm that was, until recently, heavily involved with Verizon. Vodafone Group Plc (VOD) held a major stake in Verizon, which the latter only recently purchased back to operate on its own.

With AT&T looking to expand its operations, joining forces with a firm like Vodafone can help push the boundaries on its reach and customer base. Though the companies have yet to enter formal negotiations, sources state that executives at AT&T are discussing a bid to takeover Vodafone.

It is also rumored that T is looking at the U.K. firm, EE, but that seems less likely than the Vodafone deal. The company is expected to announce a bid sometime next year and the move is heavily expected by buy-side investors. The rumors alone had Vodafone’s stock trading higher on the day.

T shares were up 1 cent at Thursday’s close. The stock is up approximately 7.5% on the year.

Good News Watch: Advanced Micro Devices (AMD) Since Its Third Quarter Earnings Report

Its been about two weeks since the latest earnings report from Advanced Micro Devices, Inc (NYSE: AMD) which sent the stock lower yet again. I should mention that we have had AMD in our SmallCap Network Elite Opportunity (SCN EO) portfolio since mid-July and its been a rollercoaster ride for the past few months because the summer earnings report (which appeared on the same day as some other disappointing earnings reports) erased our gains, which we then made back – only to have those gains erased again with the latest earnings report (See my previous article: Time to be Bullish, Bearish or Just Realistic? Advanced Micro Devices' (AMD) Third Quarter Earnings Report). Nevertheless, we still think the company represents a good value opportunity as it continues to transition away from dependence on the PC and into mobility and gaming consoles. With that in mind, here is the latest important news about AMD for investors and traders to hit the newswires since earnings:

The New AMD Radeon R9 290X Graphics Card is Launched. Last Thursday, Advanced Micro Devices announced the launch of the AMD Radeon™ R9 290X graphics card and already there are some good reviews with Vlad Savov writing one for TheVerge.com under the headline: "AMD's latest graphics card is a steal at $549" Should You Buy An AMD R9 290X Or Nvidia GTX 780? On Monday, Forbes contributor Jason Evangelho wrote a lengthy piece comparing NVIDIA Corporation's (NASDAQ: NVDA) GTX 780 with AMD's R9 290x where he noted that 24 hours ago, his results would have led to a dramatically different conclusion:

Buy AMD's 290x since it's $100 cheaper and offers comparable, if not superior, performance to its closest competitor. With this morning's aggressive price cut, however, Nvidia may be causing droves of tech journalists to revisit their 290x reviews. As things stand now, Nvidia's GTX 780 is $499, while AMD's R9 290x is $549. Make no mistake: both cards are a steal at these pricepoints.

Jason then asked the retorical question of what happens if AMD drops the 290x to $499 or if they suddenly include the 290x in their Radeon Rewards Gold bundle. His conclusion? "…it may come down to simple allegiance, impulse and sales…"

Bulls Outnumber Bears on Options Trades. Schaeffer's Trading Floor Blog pointed out last Friday that bullish bets are more popular than bearish on Advanced Micro Devices traders have bought to open 5.74 calls for every put during the past 10 sessions according to data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE) and NASDAQ OMX PHLX (PHLX). Apparently, this ratio stands in the 60th percentile of its annual range – meaning there is a slightly healthier-than-usual appetite for calls over puts. With that said, AMD's 10-day call/put volume ratio is down considerably from its October 17th when it stood at 6.73 right before its latest earnings report. Share Performance. Advanced Micro Devices is up 46% since the start of the year, up 60.9% over the past year and up 9.9% over the past five years:

Finally, here is a look at the latest technical chart for AMD:

Again, we are looking at AMD as a longer term bet rather than a quick trading opportunity – meaning the short term ups and downs aren't so important for us.

SmallCap Network Elite Opportunity (SCN EO) has an open position in AMD. To find out what other open positions SCN EO currently has, and to learn why so many traders and investors are relying on this premium subscription service, click here to find out more.

Tuesday, October 29, 2013

Wal-Mart promoting 25,000 employees

NEW YORK — Wal-Mart Stores, faced with criticism about worker pay, is making public a round of promotions of about 25,000 U.S. store employees to help send a message that it offers economic security and opportunity.

The world's largest retailer and the nation's largest private employer kicked off the on-the-spot surprise promotions at ceremonies Tuesday in its Secaucus, N.J., store and about 15 other markets including Atlanta and Denver. It's dispatching top executives to stores nationwide for similar events for the rest of its fiscal year, which ends in late January.

The mostly hourly workers will be promoted to different jobs — some to store management positions — and will receive higher pay and increased responsibility.

"It's good a time as any to tell our story," said Bill Simon, president and CEO of Wal-Mart's U.S. namesake division. He was at the Secaucus store Tuesday at a ceremony to promote six to eight workers.

The move is an addition to Wal-Mart's announcement in September that it would move 35,000 workers from temporary to part-time status and another 35,000 from part time to full time by year-end. The campaign builds on a theme the discounter pushed throughout the year, including at its annual shareholders' meeting in June, in which it cast the company as a place where employees have a chance to advance.

It has often highlighted that 75% of its store management teams started as hourly associates.

The latest campaign comes as Wal-Mart remains a target of attacks by critics, particularly union-backed groups that have argued the discounter puts profit ahead of its workers and pays meager wages.

Last week, OUR Wal-Mart, a group of current and former workers that have been staging protests at its stores, held a press conference in Washington, to pressure the discounter to pay all of its full-time workers at least $25,000 a year. It's planning another round of protests at its stores on the day after Thanksgiving, the traditional kickoff for the holid! ay shopping season.

The union-backed group latched on to a comment that Simon made at the Goldman Sachs retail investor conference last month when he said that more than 475,000 Wal-Mart workers earned more than $25,000 last year. OUR Wal-Mart inferred that with Wal-Mart employing 1.3 million workers in the U.S., about 825,000, or 63 percent, make less than $25,000 a year.

Wal-Mart says the group has distorted the figure, noting that more than 70 percent of its full-time hourly workers who have worked at its stores and its distribution centers for more than a year make at least $25,000. Wal-Mart isn't counting those who work at its Bentonville, Ark., headquarters or as drivers. Wal-Mart doesn't break down numbers for part-time and full-time workers but noted that full-time workers account for the majority of its workforce.

The Grand Superstition - John Hussman

In 1948, the behaviorist B.F. Skinner reported an experiment in which pigeons were presented with food at fixed intervals, with no relationship to any given pigeon's behavior. Despite that lack of relationship, most of the pigeons developed distinct superstitious rituals and maneuvers, apparently believing that these actions resulted in food. As Skinner reported, "Their appearance as the result of accidental correlations with the presentation of the stimulus is unmistakable."

Superstition is a by-product of the search for patterns between events – usually occurring in close proximity. This kind of search for patterns is essential for the continuation of a species, but it also lends itself to false beliefs. As Foster and Kokko (2009) put it, "The inability of individuals – human or otherwise – to assign causal probabilities to all sets of events that occur around them… will often force them to make many incorrect causal associations, in order to establish those that are essential for survival."

The ability to infer cause and effect, based on the frequency with which one event co-occurs with some other event, is called "adaptive" or "Bayesian" learning. Humans, pigeons, and many animals have this ability to learn relationships in their world. Still, one thing that separates humans from animals is the ability to evaluate whether there is really any actual mechanistic link between cause and effect. When we stop looking for those links, and believe that one thing causes another because "it just does" – we give up the benefits of human intelligence and exchange them for the reflexive impulses of lemmings, sheep, and pigeons.

To paraphrase Beck & Forstmeier (2007, italics mine):

The occurrence of superstitious beliefs is an inevitable consequence of an organism's ability to learn from observation of coincidence. Comparison with previous experiences improves the chances of making the right decision. While this approach is found in most learning organi! sms, humans have evolved a unique ability to judge from experiences whether a cause has the power to mechanistically produce the observed effect. Such strong causal thinking evolved because it allowed humans to understand and manipulate their environment. Strong causal thinking, however, involves the generation of hypotheses about underlying mechanisms.

When we fail to think about the mechanisms that link cause and effect, we lose much of the benefit of having a human intelligence.

Superstition and Credit Crisis

In general, the larger the events, the more important the events are to survival, and the closer in proximity those events occur, the more likely an organism is to believe those events are tied together by cause and effect. This makes the 2008-2009 credit crisis an ideal playground for superstition.

When we examine the 2008-2009 credit crisis in retrospect, there's no question that the central concern at that time was that massive bank failures would trigger a "global financial meltdown." The risk of widespread failures was driven by losses in mortgage-backed securities and related assets held by major banks, and by highly leveraged financial institutions like Bear Stearns and Lehman, representing the "shadow" banking system.

The balance sheet of a major bank looks like this: for every $100 of assets, the bank typically owes about $60 to depositors and $30 to bondholders, with the other $10 representing retained earnings and "equity" capital obtained by issuing stock. With $100 in assets against $10 in capital, a bank like this would be "leveraged 10-to-1" against its equity capital. At non-banks like Bear Stearns and Lehman, the leverage ratios were 30-to-1 or higher. Given 30 times leverage, it only takes a decline of just over 3% in the value of the assets to completely wipe out the capital and leave the company insolvent (as the remaining value of assets would be unable to pay off the existing obligations to customers and bondholders). In such ! an enviro! nment, a "run" on the institution can force asset sales, which accelerate capital losses and increase the likelihood of insolvency.

Under existing accounting rules, banks and other financial institutions were required to report the value of the securities they held, using prevailing market prices, a requirement known as "mark-to-market." As asset values collapsed in 2008 and early-2009 because of mortgage losses, financial institutions across the globe found themselves rapidly approaching insolvency.

As the willingness of investors to buy mortgage securities seized up, and economic activity plunged, the Federal Reserve stepped into the financial markets and became the major purchaser of existing and new mortgage securities issued by Fannie Mae and Freddie Mac. This arguably helped to support continuing activity in the housing market, but it is not what ended the crisis.

Rather, the crisis ended – and in hindsight, ended precisely – on March 16, 2009, when the Financial Accounting Standards Board abandoned mark-to-market rules, in response to Congressional pressure by the House Committee on Financial Services on March 12, 2009. The decision by the FASB gave banks "substantial discretion" in the values that they assigned to assets. With that discretion, banks could use cash-flow models ("mark-to-model") or other methods ("mark-to-unicorn").

[ Enlarge Image ]

The problem for investors is that this was quite a subtle event – hardly memorable, and certainly not grand and obvious like the Federal Reserve's intervention was. But we are wired for survival, and the larger the events, and the closer they are in proximity, the more likely we are to draw cause and effect connections between them. That's particularly true if there is at least a weakly logical way that they might be related (as was true the Fed's mortgage support).

Importantly, the impact of the FAS 157 change ! is easier! to appreciate in hindsight than it was in the fog of war. Its success relied on regulators to go along with the new numbers, and bank depositors and customers to believe them. I've frequently discussed our own response to the crisis, which was to insist that our methods to estimate market return/and risk were robust to Depression-era outcomes (even though our existing methods had anticipated the crisis and performed admirably during the market collapse). It's no secret that we missed returns in the interim as a result. We are evidence-driven investors, and similar economic and financial disruptions were simply out of context from the standpoint of post-war evidence. Nevertheless, it's critical to go back and understand the actual mechanism that ended the crisis, so that we as investors don't allow ourselves to be misled into an increasingly false sense of security about Federal Reserve actions. It's probably also worth observing how heavilly banks have relied on the release of "loan loss reserves" in order to beat earnings estimates in recent periods.

The Grand Superstition

The misattribution of cause and effect in 2009 created the Grand Superstition of our time – the belief that Federal Reserve policy was responsible for ending the financial crisis and sending the stock market higher. By 2010, this narrative was so fully accepted that the Fed's announcement of further "quantitative easing" was met by equally great enthusiasm by investors.

Complicating matters, the European Central Bank forestalled a currency crisis in Europe through massive purchases of debt from credit-strained member countries. While this action was interpreted as quantitative easing, it actually functioned as a funding operation to weaker countries that was much more akin to a fiscalsubsidy from stronger countries like Germany. Still, the fact that it was executed by the central bank and eased the Euro crisis helped to contribute to a perception that central bank purchases of government securities – in a! nd of the! mselves – are sufficient to support the stock markets indefinitely. Worse, perception creates its own reality in the financial markets, so provided enough investors believe something to be true, the outcome is the same as if it really were, but only for a while.

Don't misunderstand. Quantitative easing has undoubtedly been the primary driver of stock prices since 2010. But the benefit of having a human intelligence is the ability to evaluate the extent to which there is anymechanistic link between the cause and the effect. If there is not, investors may be resting their confidence on little more than perception and superstition. This is exactly what historical data indicates.

In the case of quantitative easing, there is one variable that is tightly, logically, and consistently linked to Fed actions. We have nearly a century of evidence that the amount of base money created by the Fed (per dollar of GDP) is strikingly related to the level of short-term interest rates. The chart below illustrates this relationship in data since 1929. Yet the same effect is not observed with anything close to the same strength for long-term bond yields. Worse, looking over the full course of history, there is virtually no relationship between the monetary base (level, change, ratio to GDP) and stock returns (regardless of whether one examines concurrent returns, subsequent returns, yields, or estimated prospective market returns).

[ Enlarge Image ]

The reason for the weak relationship between the monetary base and stock prices is simple. Though the monetary base is strongly related to Treasury bill yields, it turns out that Treasury bill yields themselves are only weakly related across history to stock yields. The belief in a close relationship between interest rates and stock yields is actually driven by the strong inflation-deflation cycle from 1970 to about 1998. Outside of this period, stock yields and interest rates h! ave gener! ally been negatively correlated.

There's no denying that since 2008, there has been a correlation of more than 90% between the level monetary base and the level of the S&P 500. But this is an artifact of how correlation is calculated. The correlation between any two diagonal lines is nearly always greater than 90%. Unfortunately, the moment we examine data that doesn't resemble a diagonal line (for example, year-over-year changes in the monetary base versus stock prices prior to 2009), the correlation doesn't hold up at all, and variations in the monetary base explain only about 1-3% of variations in stock prices.

Still, the rate of monetary growth has been breathtaking in recent years, relative to history, so it's important to understand the mechanism by which QE has exerted its effects more recently. Simply put, quantitative easing impacts stock prices by creating a mountain of zero-interest cash that must be held by someone at each point in time. The hope and mechanism behind QE is to force those cash holders to feel so distressed that they reach for yield in speculative assets they would otherwise choose not to hold. The process ends at the point where investors are indifferent between holding zero-interest cash and more speculative securities such as long-term bonds or stocks. At this point, every speculative security is priced to achieve the lowest possible risk premium that investors are willing to accept. And here we are.

What's important here is that in any environment where savers and investors actually desire relatively safe assets as part of their portfolios, quantitative easing is likely to be wholly ineffective in supporting stock prices. Recall that stock prices collapsed by half in 2000-2002 and again in 2007-2009 despite aggressive monetary easing. A friendly Fed doesn't help stocks to advance except in environments where investors are alreadyinclined to accept risk. To believe that QE makes stocks go up because "it just does" is superstition.

As ! for emplo! yment, it's quite straightforward to demonstrate that there is virtually zero relationship between changes in the monetary base and subsequent job growth, nor is there any inverse relationship between inflation and unemployment (the actual relationship is weakly positive and slopes up), nor between inflation and subsequent unemployment, nor in countless other variants of monetary "transmission" that Fed members and Wall Street economists constantly assert as if the evidence actually supports their statements.

That said, there are certainly some relationships that can be demonstrated in the data. For example, if we look at stock market changes and real GDP, it turns out that every 10% change in the stock market is associated with a temporary increase in real GDP over the following year or two in the range of 0.3% and 0.5%. So a 40% increase in the market is correlated with an increase of about 1.2% to 2% in real GDP. It's not clear that this is actually a correlation that can be manipulated to encourage higher GDP – which is what the Fed is trying to achieve – but it's at least a relationship that can be estimated.

Likewise, if we look at stock market changes and employment, it turns out that every 10% change in the stock market is associated with a temporary decrease in the unemployment rate of about 0.2%. So a 40% increase in the stock market is correlated with a decline of about 0.8% in the unemployment rate. Again, it's not clear that this is actually a correlation that can be manipulated, but that's the order of magnitude that can be expected even if the Fed's efforts are successful.

As for the Phillips Curve, it's important to recognize that the actual Phillips curve is a statement about wages, not general prices. There is, in fact, a strong inverse relationship between unemployment and real wage inflation. Low unemployment is associated with faster growth in real wages. High unemployment is associated with slower growth in real wages. This can be demonstrate! d clearly! , and in data from many countries. This is the phenomenon that A.W. Phillips described in his 1958 paper on the subject. Though he stated the relationship between unemployment and wage inflation in nominal ("money") terms, Phillips based his conclusions on a century of data where Britain was on the gold standard and general prices were very stable, so in effect, the "money" wage fluctuations observed by Phillips were actually real wage fluctuations.

In sum, the financial markets presently rest on a spectacular and exaggerated superstition about the power of Fed policy to impact the financial markets and the real economy. This superstition was born of crisis, and is likely to end in crisis, as investors re-learn what they should have learned about Fed policy in the 2000-2002 and 2007-2009 plunges.

In 2001, after the market had lost a quarter of its value, a major brokerage took out a full-page ad in Barron's arguing for a one-year price target that was more than 50% above then-prevailing market levels, saying "Stocks should soon be benefiting from the sweet spot of a friendly Fed: low interest rates and improved earnings visibility." Yet despite the friendly Fed, the market went on to lose another third of its value in just over a year. Why? Because monetary conditions are at best a modifier to the combination of valuations, market action, and overvalued, overbought, overbullish conditions. The worst market declines on record have been accompanied by a "friendly Fed." At the time, I quoted Stevie Wonder: "When you believe in things that you don't understand, then you suffer."

The vast majority of the benefit from "don't fight the Fed, don't fight the tape" comes from the "tape" part of that aphorism. That combination is powerfully outperformed by the combination of embracing favorable market action, amplifying or muting that response based on valuation, and entirely avoiding overvalued, overbought, overbullish conditions (see Aligning Market Exposure ! with the ! Expected Return/Risk Profile for a simple illustration, andFollowing the Fed to 50% Flops for a reminder of the danger of following the Fed in situations when these other conditions have been unfavorable).

Probably the most challenging aspect of quantitative easing is that, particularly since late-2011, overvalued, overbought, overbullish conditions usually associated with severe market losses have instead been associated with even more extreme speculation. That has made the advancing portion of this unfinished half cycle difficult. Still, my expectation is that investors will ultimately look back at the present market exuberance in hindsight and ask "after watching the market collapse following nearly identical bubbles in 2000 and 2007, despite aggressive monetary easing, how did we actually refuse to consider major losses in the belief – yet again – that this time was different?"

One of the differences between a pigeon and a human being is the ability to think about the mechanisms that drive cause and effect, rather than being ruled by superstitions that may be based on completely spurious correlations. At present, investors seem universally convinced that quantitative easing just makes stock prices go up, and that at some future point in time, investors will all be able to exit their holdings and sell to even greater fools. But as I wrote in May 2007 a few months before the market's pre-crash highs, "There may not be that many greater fools out there after all. As they say, if you're sitting at the poker table and you can't spot the pigeon… you're probably the pigeon."

The foregoing comments represent the general investment analysis and economic views of the Advisor, and are provided solely for the purpose of information, instruction and discourse. Only comments in the Fund Notes section relate specifically to the Hussman Funds and the investment positions of the Funds.

Fund Notes

From a full-cycle perspective, I continue to believe that the stock ! market is! vulnerable to potential losses in the 40-55% range, much like we observed and anticipated in 2000-2002 and 2007-2009. I wish this were different, and that we were instead observing a landscape of investment opportunities, with reasonable prices, high prospective returns, and supporting the economy by channeling savings to productive investment. As conditions stand, we observe a speculative carnival. We presently estimate 10-year expected nominal total returns for the S&P 500 of just 2.5% annually.

From the standpoint of evidence, which is how we set our investment positions, we continue to observe uneven, speculative, and overbought market action, with spike in the difference between advisory bullishness and bearishness according to Investors Intelligence. In addition, the S&P 500 has moved through its upper Bollinger bands at daily, weekly and monthly resolutions (two standard deviations above the respective 20-period moving averages). We also observe rich valuations on a wide variety of measures that are tightly correlated with subsequent market returns. These valuations are exemplified by a Shiller P/E (S&P 500 divided by the 10-year average of inflation adjusted earnings) that has now reached 25.

Among other factors, this full syndrome of severely overvalued, overbought, and overbullish conditions removes the basis for "contingent" positions – specifically index call options – and significantly raises our immediate concern about market risk. Particularly since late-2011, overvalued, overbought, overbullish syndromes that have historically resulted in striking market losses have instead been followed by further speculation. Still, a further speculative blowoff would only raise the cliff that we believe the market already faces over the completion of this cycle. Consider us defensive – possibly to varying degrees depending on near-term evidence – but generally defensive in any event.

Strategic Growth remains fully hedged, with a "staggered strike" position that raise! s the str! ike prices of its index put options modestly below present market levels. Strategic International is fully hedged. Strategic Dividend Value is hedged at about 50% of the value of its stock. Strategic Total Return continues to carry a duration of just over 6 years (meaning that a 100 basis point move in interest rates would be expected to impact Fund value by about 6% on the basis of bond price fluctuations, just over 8% of assets in precious metals shares, and a few percent of assets in utility shares.

http://www.hussmanfunds.com/wmc/wmc131028.htm

Monday, October 28, 2013

Is J.C. Penney a Steal at These Prices?

With shares of J.C. Penney (NYSE:JCP) trading around $18, is the company an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

J.C. Penney is a retailer operating 1,102 department stores in 49 states and Puerto Rico. Its business consists of selling merchandise and services to consumers through its department stores and through its Internet website at jcp.com. It sells family apparel and footwear, accessories, fine and fashion jewelry, beauty products through Sephora inside J.C. Penney, and home furnishings. The company has not done too well in recent years but is doing what it can to be a top provider of apparel and related products. The products J.C. Penney is able to produce and market can take the company to rising profits, but it would need to see a change of approach soon.

T = Technicals on the Stock Chart are Weak

J.C. Penney stock has seen a disastrous downtrend fueled by extreme selling pressure over the last few years. The stock is now trading at lows not seen since the 2008 financial crisis. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, J.C. Penney is trading around its flat to declining key averages which signal neutral to bearish price action in the near-term.

JCP

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of J.C. Penney options may help determine if investors are bullish, neutral, or bearish.

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Implied Volatility (IV)

30-Day IV Percentile

90-Day IV Percentile

J.C. Penney Options

53.97%

0%

2%

What does this mean? This means that investors or traders are buying a very low amount of call and put options contracts, as compared to the last 30 and 90 trading days.

Put IV Skew

Call IV Skew

June Options

Steep

Average

July Options

Steep

Average

As of today, there is an average demand from call buyers or sellers and high demand by put buyers or low demand by put sellers, all neutral to bearish over the next two months. To summarize, investors are buying a very low amount of call and put option contracts and are leaning neutral to bearish over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Decreaseing Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on J.C. Penney’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for J.C. Penney look like and more importantly, how did the markets like these numbers?

2013 Q1

2012 Q4

2012 Q3

2012 Q2

Earnings Growth (Y-O-Y)

-110.67%

-518.09%

16.42%

-1057.14%

Revenue Growth (Y-O-Y)

-16.40%

-28.41%

-26.57%

-22.63%

Earnings Reaction

-4.15%

7.37%

-16.96%

-4.84%

J.C. Penney has seen decreasing earnings and revenue figures over the last four quarters. From these figures, the markets have been very disappointed with J.C. Penney’s recent earnings announcements.

P = Poor Relative Performance Versus Peers and Sector

How has J.C. Penney stock done relative to its peers, Kohl’s (NYSE:KSS), Macy’s (NYSE:M), Sears (NASDAQ:SHLD), and the sector?

J.C. Penney

Kohl’s

Macy’s

Sears

Sector

Year-to-Date Return

-5.02%

20.13%

26.68%

18.45%

18.24%

J.C. Penney has been a poor relative performer, year-to-date.

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Conclusion

J.C. Penney provides apparel and related products to consumers across the nation utilizing its website and over a thousand retail stores. The stock has been the subject of increased selling over the last few years, which has taken it to prices not seen since the 2008 financial crisis. Over the last four quarters, earnings and revenue figures have decreased, which has led to disappointed investors. Relative to its peers and sector, J.C. Penney has been a poor year-to-date performer. STAY AWAY from J.C. Penney stock for now.

Sunday, October 27, 2013

10 Best Growth Stocks To Invest In 2014

Concerns over Federal Reserve policy and economic growth prompted global investors to pull $15 billion from exchange-traded products in August, according to data released by BlackRock on Monday. This tops outflows of $13.4 billion in January 2010, the industry’s previous record.

The August outflows also surpassed the $12 billion of redemptions made by investors in June. Plus, it marked a dramatic reversal from the nearly $44 billion of inflows investors made in July. (In August 2012, investors added $12 billion of flows to exchange-traded products.)

“Similar to June, outflows were driven by fixed income with -$5.3 billion, including -$8.1 billion from funds with longer/broader maturity profiles vs. inflows for short maturity funds,” Dodd Kittsley and Raj Seshadri wrote.

Still, there were some bright spots. Nearly $5 billion flowed into pan-European equity ETPs in August.

U.S. equity products, however, experienced $14.5 billion in outflows, $14 billion of which were redeemed from the SPDR S&P 500 (SPY).

10 Best Growth Stocks To Invest In 2014: Sara Lee Corporation(SLE)

Sara Lee Corporation engages in the manufacture and marketing of a range of branded packaged meat, bakery, and beverage products worldwide. Its packaged meat products include hot dogs and corn dogs, breakfast sausages, sandwiches and bowls, smoked and dinner sausages, premium deli and luncheon meats, bacon, beef, turkey, and cooked ham. It also offers frozen baked products, which comprise frozen pies, cakes, cheesecakes, pastries, and other desserts. In addition, Sara Lee provides roast, ground, and liquid coffee; cappuccinos; lattes; and hot and iced teas, as well as refrigerated dough products. The company sells its products under Hillshire Farm, Ball Park, Jimmy Dean, Sara Lee, State Fair, Douwe Egberts, Senseo, Maison du Caf

10 Best Growth Stocks To Invest In 2014: CNO Financial Group Inc. (CNO)

CNO Financial Group, Inc., through its subsidiaries, engages in the development, marketing, and administration of health insurance, annuity, individual life insurance, and other insurance products for senior and middle-income markets in the United States. The company markets and distributes Medicare supplement insurance, interest-sensitive and traditional life insurance, fixed annuities, and long-term care insurance products; Medicare advantage plans through a distribution arrangement with Humana Inc.; and Medicare Part D prescription drug plans through a distribution and reinsurance arrangement with Coventry Health Care. It also markets and distributes supplemental health, including specified disease, accident, and hospital indemnity insurance products; and life insurance to middle-income consumers at home and the worksite through independent marketing organizations and insurance agencies. In addition, the company markets primarily graded benefit and simplified issue life insurance products directly to customers through television advertising, direct mail, Internet, and telemarketing. It sells its products through career agents, independent producers, direct marketing, and sales managers. CNO Financial Group, Inc. has strategic alliances with Coventry and Humana. The company was formerly known as Conseco, Inc. and changed its name to CNO Financial Group, Inc. in May 2010. CNO Financial Group, Inc. was founded in 1979 and is headquartered in Carmel, Indiana.

Advisors' Opinion:
  • [By Vanin Aegea]

    I have heard many people comment about the insurance policies for cars, houses, life, assets, etc. The arguments always revolve around the same issue: Is it really necessary? What are the chances to be hit by a Hurricane, or to meet a sudden death? Well, nobody really knows. Some individuals however, sleep better when they know a policy backs their life investments. Here, I will look into three insurance companies that concentrate on different policies, or geographies. These are: China Life (LFC), and Conseco (CNO).

  • [By Jonas Elmerraji]

    Up first is CNO Financial Group (CNO), a mid-cap financial stock that's rocketed close to 60% higher since the calendar flipped over to January. Yup, it's been a great year for the market, but it's been a far better one for investors who own CNO. But that strong performance isn't showing any signs of slowing yet. In fact, CNO looks primed for even more upside in the fourth quarter.

    That's because CNO is currently forming a bullish pattern called an ascending triangle. The ascending triangle pattern is formed by a horizontal resistance level above shares -- in this case at $14.75 -- and uptrending support to the downside. Basically, as CNO bounces in between those two technical price levels, it's getting squeezed closer and closer to a breakout above that $14.75 resistance level. When that breakout happens, it's time to become a buyer.

    ACCO's price action isn't exactly textbook. After all, the pattern is coming in at the bottom of a downtrend, not after an uptrend. But ultimately, that doesn't change the trading implications of a move through that $7.50 level.

    Whenever you're looking at any technical price pattern, it's critical to think in terms of those buyers and sellers. Ascending triangles and other pattern names are a good quick way to explain what's going on in a stock, but they're not the reason it's tradable. Instead, it all comes down to supply and demand for shares.

    That $7.50 resistance level is a price where there has been an excess of supply of shares; in other words, it's a place where sellers have been more eager to step in and take gains than buyers have been to buy. That's what makes a breakout above it so significant. The move means that buyers are finally strong enough to absorb all of the excess supply above that price level.

    Don't be early on this trade.

Hot Insurance Stocks To Own For 2014: Waste Management Inc.(WM)

Waste Management, Inc., through its subsidiaries, provides waste management services to residential, commercial, industrial, and municipal customers in North America. It offers collection, transfer, recycling, and disposal services. The company also owns, develops, and operates waste-to-energy and landfill gas-to-energy facilities in the United States. Its collection services involves in picking up and transporting waste and recyclable materials from where it was generated to a transfer station, material recovery facility, or disposal site; and recycling operations include collection and materials processing, plastics materials recycling, and commodities recycling. In addition, it provides recycling brokerage, which includes managing the marketing of recyclable materials for third parties; and electronic recycling services, such as collection, sorting, and disassembling of discarded computers, communications equipment, and other electronic equipment. Further, the company e ngages in renting and servicing portable restroom facilities to municipalities and commercial customers under the Port-o-Let name; and involves in landfill gas-to-energy operations comprising recovering and processing the methane gas produced naturally by landfills into a renewable energy source, as well as provides street and parking lot sweeping services. Additionally, it offers portable self-storage, fluorescent lamp recycling, and medical waste services for healthcare facilities, pharmacies, and individuals, as well as provides services on behalf of third parties to construct waste facilities. The company was formerly known as USA Waste Services, Inc. and changed its name to Waste Management, Inc. in 1998. Waste Management, Inc. was incorporated in 1987 and is based in Houston, Texas.

Advisors' Opinion:
  • [By John Persinos]

    One dominant company in the handling, treatment, and disposal of solid waste is Waste Management (WM). With this industry leader, investors are paying for market dominance, relative predictability, good dividends, and high cash flow.

10 Best Growth Stocks To Invest In 2014: MEDIFAST INC(MED)

Medifast, Inc., through its subsidiaries, engages in the production, distribution, and sale of weight management and disease management products, and other consumable health and diet products in the United States. The company?s product lines include weight and disease management, meal replacement, and vitamins. It also operates weight control centers that offer Medifast programs for weight loss and maintenance, customized patient counseling, and inbody composition analysis. The company markets its products under the Medifast and Essential brand names, including shakes, appetite suppression shakes, women?s health shakes, diabetics shakes, joint health shakes, coronary health shakes, calorie burn drinks, calorie burn flavor infusers, antioxidant shakes, antioxidant flavor infusers, bars, crunch bars, soups, chili, oatmeal, pudding, scrambled eggs, hot cocoa, cappuccino, chai latte, iced teas, fruit drinks, pretzels, puffs, brownie, pancakes, soy crisps, crackers, and omega 3 and digestive health products. Medifast Inc. sells its products through various channels of distribution comprising Web, call center, independent health advisors, medical professionals, weight loss clinics, and direct consumer marketing supported via the phone and the Web; Take Shape for Life, a physician led network of independent health coaches; and weight control centers. The company was founded in 1980 and is headquartered in Owings Mills, Maryland.

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

    Medifast Inc. (NYSE: MED) saw its stock down 5% in evening trading on Tuesday after the weight loss player had soft sales and guided expectations lower. Shares were still indicated down about 5%, but volume has not yet started.

  • [By Holly LaFon] ast produces, distributes and sells weight and health management products with the brand names Medifast, Take Shape for Life, Hi-Energy Weight Control Centers and Woman�� Wellbeing.

    Its return on assets in the third quarter of 2011 was 19.6%, which has been increasing in the past several years. The average return on assets for the specialty retail industry is 10.48% for the trailing 12 months.

    The company�� total assets amounted to $94 million in 2010, which increased from $62.8 million in 2009. Net income also increased to $19.6 million in 2010 from $12 million in 2009.

    Boston Beer Inc. (SAM)

    Boston Beer Inc. is the largest brewer of handcrafted beers in America. Boston Beer is a growing company that recently saw a large increase in its return on assets. It increased from 19.3% in 2010 to 29.7% in 2011, and was negative as recently as 2008. The average return on assets for the beverages industry in the trailing 12 months is 9.47%.

    In 2011, the company�� total assets increased to $272.5 million from $258.5 million in 2010. Net income increased to $66 million from $50 million.

    Alliances Resources Partners (ARLP)

    Alliance Resources Partners is a coal producer and marketer primarily in the eastern U.S. Its ROA has been increasing since 2008 and increased to 22.5% in 2011 from 21.4% in 2010. The average return on assets for the oil, gas & consumable fuels industry in the trailing 12 months is 24.47%.

    In 2011, its total assets increased to $1.7 billion from $1.1 billion in 2010. Its net income increased to $389 million from $321 million.

    Factset Research Systems Inc. (FDS)

    Factset researches global market trends and develops analytical tools for investors. Of all of GuruFocus��5-star predictable companies, it has the highest return on assets at 27%. ROA has been increasing over the past several years. The average return on assets for the software industry for the trailing 12 m

10 Best Growth Stocks To Invest In 2014: Crocs Inc.(CROX)

Crocs, Inc. and its subsidiaries engage in the design, development, manufacture, marketing, and distribution of footwear, apparel, and accessories for men, women, and children. The company primarily offers casual and athletic shoes, and shoe charms. It also designs and sells a range of footwear and accessories that utilize its proprietary closed cell-resin, called Croslite. The company?s footwear products include boots, sandals, sneakers, mules, and flats. In addition, it provides footwear products for the hospital, restaurant, hotel, and hospitality markets, as well as general foot care and diabetic-needs markets. Further, the company offers leather and ethylene vinyl acetate based footwear, sandals, and printed apparels principally for the beach, adventure, and action sports markets; and accessories comprising snap-on charms. The company sells its products through the United States and international retailers and distributors, as well as directly to end-user consumers th rough its company-operated retail stores, outlets, kiosks, and Web stores primarily under the Crocs Work, Crocs Rx, Jibbitz, Ocean Minded, and YOU by Crocs brand names. As of December 31, 2010, it operated 164 retail kiosks located in malls and other high foot traffic areas; 138 retail stores; 76 outlet stores; and 46 Web stores. Crocs, Inc. operates in the Americas, Europe, and Asia. The company was formerly known as Western Brands, LLC and changed its name to Crocs, Inc. in January 2005. Crocs, Inc. was founded in 1999 and is headquartered in Niwot, Colorado.

Advisors' Opinion:
  • [By James Brumley]

    The next Crocs (CROX) earnings announcement is coming after the market closes Wednesday, Oct. 30, and if this report is anything like most Crocs earnings updates … well, investors have a 50-50 shot at hearing good news.

  • [By Rich Bieglmeier]

    According to Yahoo finance, Crocs, Inc. (CROX) will release its third quarter financial results on Monday, October 21, 2013; however, the company's investor's relations page makes no note of any impending announcements. That being said, CROX normally reports Q3 EPS around October 24th. So, next Thursday-ish instead of Monday is possible.

  • [By Matt Brownell]

    AOL When we spoke to Crocs (CROX) CEO John McCarvel back in January, we couldn't help but notice his choice of footwear: He wasn't wearing Crocs. But we couldn't really hold it against him. McCarvel was in town to accept an innovator award from the National Retail Federation, and Crocs didn't really make anything appropriate for the occasion. You can't wear Crocs with a suit, right? Well, that's not entirely true. As it turns out, Crocs now offers a number of shoes that are a bit more on the dressy side. They've got loafers, for instance, which could work at the country club. And for the office they've got the "Tummler" shoe, which combines the molded rubber clogs with a black leather slip-on dress shoe. As the website explains, it's meant to be a "work shoe you can live with." Around the same time we came across the Crocs dress shoe, we also became aware of another product that tries to combine stay-at-home comfort with office-appropriate wear: Dress pants-style sweatpants. These have all the comfort and warmth of a pair of sweatpants, but are designed like a pair of dress slacks, complete with back pockets, belt loops and pinstripes. Together, the Crocs dress shoes and sweatpants dress pants suggest a new paradigm for office wear: Dressy enough to pass muster with your boss, but comfortable enough that you can feel like you're having a pajama day working from home. But could you really pull this off in an office environment? To find out, I got a pair of each, then put them on and headed down to the offices of StyleList, Aol's fashion experts. I modeled my office wear for a panel of three StyleList editors: Ellen Thomas, Logan Sowa and Abby Silverman. Their first reaction was telling -- two of them didn't realize that I'd actually changed into the sweatpants. That, I thought, meant that I could get away with wearing sweatpants without anyone noticing. But on closer inspection, doubts started to emerge. "I don't think I'll ever be inclined to think this is

10 Best Growth Stocks To Invest In 2014: Intuitive Surgical Inc.(ISRG)

Intuitive Surgical, Inc. designs, manufactures, and markets da Vinci surgical systems for various surgical procedures, including urologic, gynecologic, cardiothoracic, general, and head and neck surgeries. Its da Vinci surgical system consists of a surgeon?s console or consoles, a patient-side cart, a 3-D vision system, and proprietary ?wristed? instruments. The company?s da Vinci surgical system translates the surgeon?s natural hand movements on instrument controls at the console into corresponding micro-movements of instruments positioned inside the patient through small puncture incisions, or ports. It also manufactures a range of EndoWrist instruments, which incorporate wrist joints for natural dexterity for various surgical procedures. Its EndoWrist instruments consist of forceps, scissors, electrocautery, scalpels, and other surgical tools. In addition, it sells various vision and accessory products for use in conjunction with the da Vinci Surgical System as surgical procedures are performed. The company?s accessory products include sterile drapes used to ensure a sterile field during surgery; vision products, such as replacement 3-D stereo endoscopes, camera heads, light guides, and other items. It markets its products through sales representatives in the United States, and through sales representatives and distributors in international markets. The company was founded in 1995 and is headquartered in Sunnyvale, California.

Advisors' Opinion:
  • [By Dan Caplinger]

    Intuitive Surgical (NASDAQ: ISRG  ) will release its quarterly report on Thursday, but don't expect shareholders to be too excited about the report. Shares of the company recently traded at their lowest levels in nearly two years, and with ongoing controversy about the company's da Vinci robotic surgical systems, it's unclear whether Intuitive Surgical earnings can hold up to the pressure the stock is under right now.

10 Best Growth Stocks To Invest In 2014: Eastern Insurance Holdings Inc.(EIHI)

Eastern Insurance Holdings, Inc., through its subsidiaries, provides workers compensation insurance and reinsurance products in the United States. The company?s Workers Compensation Insurance segment provides traditional workers compensation insurance coverage products, including guaranteed cost policies, policyholder dividend policies, retrospectively-rated policies, deductible policies, and alternative market products to employers. This segment distributes its workers? compensation products and services through its independent insurance agents primarily in Pennsylvania, Delaware, North Carolina, Maryland, Indiana, and Virginia. Its Segregated Portfolio Cell Reinsurance segment offers alternative market workers compensation solutions comprising program design, fronting, claims administration, risk management, segregated portfolio cell rental, asset management, and segregated portfolio management services to individual companies, groups, and associations. Eastern Insurance Holdings, Inc. is headquartered in Lancaster, Pennsylvania.

Advisors' Opinion:
  • [By Lauren Pollock]

    ProAssurance Corp.(PRA) agreed to acquire Eastern Insurance Holdings Inc.(EIHI) for about $205 million, expanding the insurance company’s casualty insurance offerings. Eastern Insurance is a domestic casualty insurance group specializing in workers’ compensation products and services, among other things. ProAssurance plans to pay $24.50 in cash for each outstanding Eastern share, a 16% premium over Monday’s closing price.

10 Best Growth Stocks To Invest In 2014: Nordstrom Inc.(JWN)

Nordstrom, Inc., a fashion specialty retailer, offers apparel, shoes, cosmetics, and accessories for women, men, and children in the United States. It offers a selection of brand name and private label merchandise. The company sells its products through various channels, including Nordstrom full-line stores, off-price Nordstrom Rack stores, Jeffrey? boutiques, treasure & bond, and Last Chance clearance stores; and its online store, nordstrom.com, as well as through catalog. Nordstrom also provides a private label card, two Nordstrom VISA credit cards, and a debit card for Nordstrom purchases. The company?s credit and debit cards feature a shopping-based loyalty program. As of September 30, 2011, it operated 222 stores, including 117 full-line stores, 101 Nordstrom Racks, 2 Jeffrey boutiques, 1 treasure & bond store, and 1 clearance store in 30 states. The company was founded in 1901 and is based in Seattle, Washington.

Advisors' Opinion:
  • [By Andrew Marder]

    Then and now
    We won't dwell on the past, since it's not going to help us predict the future, but it would be silly not to hit the highlights. Starting at the top, Macy's has increased its revenue for four years running, and it hit $27 billion in 2012. Earnings per share have kept up as well, rising from $0.78 in 2009 to $3.29 last year. That's a 321% increase over four years. To put some context around that, Nordstrom (NYSE: JWN  ) has grown earnings per share by 78% over the same period.

  • [By Adam Levine-Weinberg]

    While the e-commerce revolution is disrupting many traditional brick-and-mortar retailers, there are still some "physical" retailers that continue to show solid growth. Two particularly promising investment opportunities in this vein are Nordstrom (NYSE: JWN  ) and TJX (NYSE: TJX  ) . Both companies are well positioned within their sectors, and see the rise of e-commerce as an opportunity rather than a threat.

  • [By Doug Ehrman]

    As brick-and-mortar retailers continue to look for ways to level the playing field in terms of customers' data�relative to their online brethren like Amazon.com, they're experimenting with an increasing number of technologies. A recent New York Times article detailed how Nordstrom (NYSE: JWN  ) recently ended such a test with Euclid Analytics that used customers' smartphones to track their movements within stores; in-store signs detailing the practice drew negative customer feedback, leading to the end of the experiment.

10 Best Growth Stocks To Invest In 2014: Thoratec Corporation(THOR)

Thoratec Corporation engages in the development, manufacture, and marketing of proprietary medical devices used for circulatory support. The company?s primary product lines include ventricular assist devices, such as HeartMate II, an implantable left ventricular assist device consisting of a rotary blood pump to provide intermediate and long-term mechanical circulatory support (MCS); and HeartMate XVE, an implantable and pulsatile left ventricular assist device for intermediate and longer-term MCS. Its ventricular assist devices also comprise Paracorporeal Ventricular Assist Device, an external pulsatile ventricular assist device, which provides left, right, and biventricular MCS approved for bridge-to-transplantation (BTT), including home discharge, and post-cardiotomy myocardial recovery; and Implantable Ventricular Assist Device, an implantable and pulsatile ventricular assist device designed to provide left, right, and biventricular MCS approved for BTT comprising hom e discharge, and post-cardiotomy myocardial recovery. The company also provides CentriMag, an extracorporeal full-flow acute surgical support platform that offers support up to 30 days for cardiac and respiratory failure. In addition, it offers PediMag and PediVAS extracorporeal full-flow acute surgical support platforms designed to provide acute surgical support to pediatric patients. The company sells its products through direct sales force in the United States, as well as through a network of distributors internationally. Thoratec Corporation was founded in 1976 and is headquartered in Pleasanton, California.

Advisors' Opinion:
  • [By Brian Pacampara]

    What: Shares of medical device company Thoratec (NASDAQ: THOR  ) sank 12% today after its quarterly results missed Wall Street expectations. �

10 Best Growth Stocks To Invest In 2014: TrueBlue Inc.(TBI)

TrueBlue, Inc. provides temporary blue-collar staffing services in the United States. It supplies on demand general labor to various industries under the Labor Ready brand; skilled labor to manufacturing and logistics industries under the Spartan Staffing brand; and trades people for commercial, industrial, and residential construction, and building and plant maintenance industries under the CLP Resources brand. The company also provides mechanics and technicians to the aviation maintenance, repair and overhaul, aerospace manufacturing, and assembly industries, as well as to other transportation industries under the Plane Techs brand; and temporary drivers to the transportation and distribution industries under the Centerline brand. It primarily serves small and medium-size businesses. The company was formerly known as Labor Ready, Inc. and changed its name to TrueBlue, Inc. in December 2007. TrueBlue, Inc. was founded in 1985 and is headquartered in Tacoma, Washington.

Advisors' Opinion:
  • [By Jonathan Yates]

    Even though the stock market rallied on Federal Reserve Chairman Ben Bernanke's remarks with the Dow Jones Industrial Average (NYSE: DIA) and Standard & Poor's 500 Index (NYSE: SPY) surging, the long term winners will be stocks in the staffing industry such as Paychex(NASDAQ: PAYX), TrueBlue (NYSE: TBI), Robert Half (NYSE: RHI), and Labor SMART (OTCBB: LTNC).

Saturday, October 26, 2013

Top 5 Low Price Stocks To Invest In 2014

Yamana Gold (NYSE: AUY  ) will release its quarterly report on Wednesday, and investors already understand that the plunge in gold prices that came in April will have a huge negative impact on the company's financial success. Yet even as other less healthy gold miners expect sizable losses, Yamana earnings should remain positive and give the company a good chance to endure the adverse pricing environment with minimal damage.

As difficult as it is to find and extract gold from the ground, it's easy for investors to understand what happens to mining companies when the prices they get for their products drop. In the long run, Yamana obviously needs to see higher gold prices to maximize profits, but could low prices actually help the company by giving it some new opportunities? Let's take an early look at what's been happening with Yamana Gold over the past quarter and what we're likely to see in its quarterly report.

Stats on Yamana Gold

Analyst EPS Estimate

Top 5 Low Price Stocks To Invest In 2014: National Australia Bank Ltd (NAB.AX)

National Australia Bank Limited provides products, advice and services. In Australia, it operates through National Australia Bank, MLC and UBank. In the United Kingdom, it operates through Clydesdale Bank. In New Zealand, it operates through Bank of New Zealand. In the United States, it operates through Great Western Bank. Segments include Business Banking, Personal Banking, Wholesale Banking, UK Banking and NZ Banking, MLC and NAB and Great Western Ban. As of April 5, 2012, the Company and its associated entities ceased to be a substantial holder in BlueScope Steel Limited. On May 17, 2012, it ceased to be a substantial holder in Spark Infrastructure Group and Sandfire Resources NL. As of August 24, 2012, the Company and its associated entities ceased to be holder in Tabcorp Holdings Limited. In September 2012, the Company and its associated entities have ceased to be a substantial holder in Incitec Pivot Limited, as of August 30, 2012.

Top 5 Low Price Stocks To Invest In 2014: TUI TRAVEL PLC ORD GBP0.10(TT.L)

TUI Travel PLC operates as an international leisure travel company. It provides distribution, tour operating, and airlines services; and destination services to tour operators, travel agencies, corporate clients, and direct to the consumer, which include hotel accommodation, transfers, excursions, round trips, organizing meetings, incentives, conferences and events, and cruise handling. It also engages in marine, adventure, ski, student, and sport trips; and marine charter business. The company is headquartered in Crawley, the United Kingdom. TUI Travel PLC operates as a subsidiary of TUI AG.

Top 10 Canadian Stocks To Own Right Now: NMDC Ltd (NMDC.NS)

NMDC Limited (NMDC) is an India-based iron ore producer and exporter. The Company operates in two business segments: iron ore and other minerals and services. The Company is engaged in the exploration of a range of minerals including iron ore, copper, rock phosphate, lime stone, dolomite, gypsum, bentonite, magnesite, diamond, tin, tungsten, graphite, and beach sands. As of March 31, 2012, it produced about 30 million tons of iron ore from three fully mechanized mines, which include Bailadila Deposit-14/11C, Bailadila Deposit-5, 10/11A (Chhattisgarh State) and Donimalai Iron Ore Mines (Karnataka State). As of March 31, 2012, NMDC supplied 269.16 lakh tons of iron ore to domestic industries and had exported 3.85 lakh tons of iron ore. Its sponge Iron production was at 37,260 tons and its diamond production was 18043.44 carats during the year fiscal ended March 31,2012. On December 12, 2011, the Company's wholly owned subsidiary NMDC Power Ltd was incorporated.

Top 5 Low Price Stocks To Invest In 2014: OM Group Inc.(OMG)

OM Group, Inc. develops, produces, and markets specialty chemicals, advanced materials, and electrochemical energy storage products worldwide. The company operates in three segments: Advanced Materials, Specialty Chemicals, and Battery Technologies. The Advanced Materials segment manufactures inorganic products using unrefined cobalt and other metals and serves the battery materials, powder metallurgy, ceramics, and chemical end markets. It offers cobalt powders, precursors, chemicals, pigments and ceramics, and various raw materials. These products enhance the electrical conduction of rechargeable batteries, as well as strengthen and add durability to diamond and machine cutting tools and drilling equipment. The Specialty Chemicals segment offers electronic chemicals for the printed circuit board, memory disk, general metal finishing, electronic packaging and finishing, and photovoltaic markets. This segment also provides advanced organics comprising additives and driers for paints, and printing inks; rubber adhesion promoters for tires; composite and other catalysts for chemicals; and fuel oil additives, lubricants, and grease additives. In addition, it offers ultra pure chemicals used in the manufacture of electronic and computer components, such as semiconductors, wafers, and liquid crystal displays; and photo-imaging masks, including high-purity quartz or glass plates containing precision, microscopic images of integrated circuits; and reticles for the semiconductor, optoelectronics, and microelectronics industries under the Compugraphics brand name. The Battery Technologies segment provides battery products, primary and secondary batteries, battery management systems, battery chargers, and energetic devices for defense applications; primary and secondary batteries for satellites, aircraft, and the packaging of cells; and miniature batteries to power implantable medical devices. The company was founded in 1991 and is headquartered in Cle veland, Ohio.

Advisors' Opinion:
  • [By Canadian Value]

    Position % of Fund Assets 1) First American Financial Corp. (FAF) 7.0% 2) Apple, Inc. (AAPL) 6.5% 3) Coinstar, Inc. (CSTR) 4.8% 4) EMC Corp. (EMC) 4.4% 5) Coach, Inc. (COH) 4.4% 6) Kohl's Corp. (KSS) 4.1% 7) Blucora, Inc. (BCOR) 4.0% 8) Tetra Tech, Inc. (TTEK) 3.1% 9) OM Group, Inc. (OMG) 3.0% 10) American International Group, Inc. (AIG) 2.8% TOTAL 44.1% One area that we believe still offers some value in the market is in high quality, large��ap technology stocks that may be momentarily out��f��avor as they transition from rapid growth to slower growth. In particular, we become interested when that transition is also accompanied by a change in capital allocation policies designed to return more cash to shareholders in the form of dividends and share repurchases. We believe that Apple and EMC are two of the absolute highest quality technology businesses in the world and both have recently announced very material, shareholder��friendly changes to how they will allocate capital.

  • [By Seth Jayson]

    There's no foolproof way to know the future for OM Group (NYSE: OMG  ) or any other company. However, certain clues may help you see potential stumbles before they happen -- and before your stock craters as a result.

Top 5 Low Price Stocks To Invest In 2014: Infinito Gold Ltd(IG.V)

Infinito Gold Ltd., a development stage exploration company, engages in the acquisition, exploration, and development of mineral interests primarily in Costa Rica and Nicaragua. It holds interests in the Crucitas gold mining project comprising 800 square kilometers of exploration concession area in northern Costa Rica. The company was formerly known as Vannessa Ventures Ltd. and changed its name to Infinito Gold Ltd. in May 2008. Infinito Gold Ltd. was founded in 1981 and is based in Calgary, Canada.

Friday, October 25, 2013

Friday’s Pre-Market Earnings: Sherwin-Williams Company, Eaton Corporation, More (SHW, ETN, NWL, SR, More)

A number of big-name dividend stocks reported earnings today before the opening bell. Check out our run-down of their quarterly reports below.

Sherwin-Williams Earnings Rise, Cuts Outlook

Paint supply retailer Sherwin-Williams Company (SHW) reported third quarter earnings of $262.97 million, or $2.55 per share, up 12% from $234.95 million, or $2.24 per share, a year ago. On average, analysts expected to see earnings of $2.64 per share. Total sales were $2.85 billion, down from $2.6 billion last year. Analysts expected to see sales of $2.78 billion. Looking forward, the company has lowered its estimates for FY2013 from a range of $7.45 to $7.55 per share to a new range of $7.00 to $7.30 per share. Analysts expect to see earnings of $7.69 billion.

Eaton Corporation Q3 Profits Match Estimates, Reports Weak Outlook

Industrial manufacturer Eaton Corporation (

The Big (and Profitable) Changes in MLPs

From the Editor: Shares of MarkWest Energy Partners (NYSE: MWE) are up 63% since Kent recommended them in Energy Advantage. Genesis Energy LP (Nasdaq: GEL) is up 71%. But the MLP market is about to get much more interesting, according to Kent. That's why he's targeting the "clones" now...

From the tax advantages to their high-paying yields, it's hard to beat the returns of a Master Limited Partnership (MLP).

And the good news for us is that this market is about to heat up again, especially when it comes to energy-based MLPs.

You see, the shape and focus of these MLPs is changing fast and for the better - even though it hasn't drawn much attention outside of these pages quite yet.

However, don't expect all of this to remain under the radar for too much longer.

In fact, new "MLP clones" are beginning to emerge that are going to hand us some interesting investment options in the coming months.

The Best MLPs for Income and Growth    Above-average yields are what attract most investors to MLPs.For MLP investors, what is about to hit is really something quite new...

The Advantages of Master Limited Partnerships (MLPs)

Of course, MLPs have long been a particularly attractive partnership option.

And when a company decides to float a part of the partnership proceeds as an equity issuance, average retail investors are allowed to participate as well.

One of the advantages of this arrangement is that an MLP carries tax considerations that distinguish it from other limited partnerships. In an MLP, there are no corporate taxes paid, meaning that all profits are carried through to the individual tax returns of limited partners.

And when stock is issued on such a partnership it is tantamount to a percentage of the profits passing directly through to the shareholders. Usually that translates into a dividend that is much higher than market averages.

It sounds like a perfect arrangement. But there are considerations on the other side investors need to account for.

For instance, MLPs must have a physical asset base.

That is, they have to be structured around tangible facilities. That's why most are based on oil and gas pipelines.

Of course, there are some exceptions. My favorite outlier, about as non-oil and gas as you can get, is StoneMor Partners LP (NYSE: STON). StonMor is an MLP that manages cemeteries... and it pays a 9.5% yield!

As it stands, the problems for the dominant pipeline-based MLPs emerge in two ways.

First, during periods in which natural gas or crude oil prices are declining, the value of an MLP based on pipelines will also decline.

Since much of that network is actually used for storage rather than transit, MLPs usually benefit whether a producer needs to ship or store volume coming out of the ground. However, in times when storage capacity maxes out, MLPs will also suffer.

Second, the structure of assets comprising the base for the partnership is also important. Facilities in areas where production is declining or that contain older pipelines that require either refurbishment or replacement will cut into the profitability of an MLP.

After all, there is no pass through income flow if operators are not using the pipelines. Therefore, MLPs are not automatically profitable at all times.

Yet there is another reason why limited partners are attracted to them.

In addition to the advantage of no corporate taxes, there is the added attraction of significant tax write-offs on the underlying assets themselves. Owning a percentage of those assets (which every limited partner does in an MLP) allows for the proportional pass through of depreciations, capital incentives, and rollovers.

The partners, therefore, have reasons for sticking with an MLP even when profits decline. As for shareholders, they have to be more attentive to the market conditions.

A Whole New World for MLPs

The good news is there are some changes in MLPs that will provide additional options for the average investor. I have been tracking two that are particularly interesting. In each case, though, we are seeing an expansion of the assets utilized and the pass-through elements available.

The first change involves the assets comprising the base of the MLP. While the essential structure is not changing (and actually could not unless legislation is altered), I now expect a dual move on the asset side: expansion into the upstream and downstream from the current pipeline (or midstream) emphasis, and crossovers between energy sources.

With these changes, MLPs are showing up at the wellhead - upstream where the actual oil and gas comes out of the ground.

At the same time, holdings in initial processing and separation, refineries, and wholesale and retail distribution, along with terminal and underground storage facilities, are moving the focus downstream.

This new mix of assets increases the options for investors, allowing MLPs to "verticalize" more of the overall operations.

It also provides increasing access to multiple points of profitability. And here crossovers are going to revise MLPs significantly.

Of course, there have always been MLPs in energy sources other than oil and gas. Electricity production and distribution, for example, have been long represented in such partnerships, as have coal assets.

But now new partnerships are coming that will cut across energy types.

Expect to see the first versions, the first new "MLP clones," if you will, to emerge connecting natural gas assets with power production. Given the rapid transition from coal to gas as the generating fuel of choice, the "spark spread" (the difference between gas and electricity futures contract prices) will entice combinations of gas and electricity assets in the same MLP.

Similar crossovers will occur between coal and power facilities, liquefied natural gas (LNG) production and tanker fleets, and even transmission lines and emerging smart grid networks.

In each case, the new MLP will provide entry to asset elements that are actually working together in a continuous revenue or profit stream.

The second major advance is likely to be structures that allow for some pass through of the tax advantages currently reserved for the limited partners only. Now, stockholders are never going to achieve parity with the partners. The latter, after all, actually own the assets upon which the tax advantages are based.

Nonetheless, I expect to see MLP models that will augment dividends to shareholders by monetizing some of the write-offs currently enjoyed by the partners. There have even been some rumblings that the folks with big red noses, funny hats, oversized shoes, and undersized cars (i.e., the clowns of Congress) may even be considering a mandate in this direction.

All of which should hand us some interesting new ways to make some serious money.

I'll have much more on this as it develops.

Thursday, October 24, 2013

Tuesday's Top Upgrades (and Downgrades)

This series, brought to you by Yahoo! Finance, looks at which upgrades and downgrades make sense, and which ones investors should act on. Today, our headlines feature a pair of downgrades for Ryder System (NYSE: R  ) and Zions Bancorp (NASDAQ: ZION  ) . But the news isn't all bad, so before we address those two, let's start with why one analyst thinks...

SanDisk is no flash in the pan
Tuesday dawned bright for owners of "flash" memory specialist SanDisk (NASDAQ: SNDK  ) . The company just announced it will begin selling the "world's fastest 64GB microSDXC card," the SanDisk Extreme microSDXC, which the company says is ideal for use in the latest smartphones, tablets and cameras. No sooner had it done so than analysts at Needham & Co. upped their price target on SanDisk stock to $75 -- a five-buck bump over the previous target.

Is SanDisk worth it?

Although at first glance, 31 times earnings looks like a lot to pay for a stock in the volatile tech sector, SanDisk is one of the leaders in flash memory products -- and it's growing fast. Analysts on average project 28% annualized earnings growth at the company over the next five years -- nearly fast enough to justify the P/E ratio. Plus, SanDisk is currently generating cash at a 16% faster clip than the rate at which it reports earnings, generating $544 million in free cash flow over the past year.

At a price-to-free cash flow ratio of 27 today, the stock's not quite as cheap as I'd like to buy it -- but regardless, there's little doubt that Needham is right about this one: Even after running up 73% over the past year, it's still not too late to buy. SanDisk shares are still cheap enough to buy.

If only we could say the same about the stocks getting downgraded today.

Zion going downhill? 
First up: Zions Bancorp. It's been a good year for Zions shareholders so far, but with their stock up 66% over the past 12 months, analysts at RBC Capital Markets think it's time to take a step back and consider whether the stock's really worth it.

Priced north of 23 times earnings, Zions carries a P/E ratio nearly twice that of larger, sturdier banks such as US Bancorp and Wells Fargo. Expected to grow its earnings at less than 8% per year going forward, it's arguably a poor bet that the company's weak earnings justify such a valuation -- even if Zions does have a cheaper price-to-book-value ratio.

With a dividend yield that's just a fraction of what its larger banking brethren pay, there's little to recommend this bank, aside from the valuation on its stock. And today, the P/E ratio tells me there's little to recommend the stock on that score, either.

Ryder System: time to dismount?
The middle of the summer moving season might seem like a strange time to be downgrading Ryder, owner of the famed Ryder Truck rental brand. Nonetheless, that's just what banker BB&T Capital did today -- and it's right to do it.

In contrast to SanDisk, which generates a bit more free cash flow than it's allowed to claim as "net income" under GAAP, Ryder actually burns cash on its cashflow statement, even as it claims to be earning income on its income statement.

Cash-burn came to $462 million over the past 12 months. But honestly, even if Ryder's $215 million in claimed GAAP income was all it was cracked up to be, I'd still think the stock expensive: 14.5 times earnings is too much to pay for Ryder's sub-10% earnings growth rate. And that's before you even calculate the effect of Ryder's $3.8 billion net-debt load on the stock's valuation.

Given my druthers, were I asked to recommend a truck rental shop today, I think I'd have to go with U-Haul owner AMERCO (NASDAQ: UHAL  ) instead. It's got the free cash flow that Ryder lacks, plus a cheaper P/E, a slightly faster growth rate, and a smaller debt load. Honestly, I don't "love" AMERCO either -- but it's a heck of a better value than Ryder.

Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool recommends Wells Fargo. The Motley Fool owns shares of Wells Fargo.

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Video Icahn: We're Not Leaving Apple, We're There to Stay

Billionaire investor, Carl Icahn speaks to Bloomberg Television's Trish Regan this afternoon on "Street Smart" and said on Apple (AAPL):

- Apple buyback would be 'no-brainer'

- "We are not leaving Apple, we are there to stay"

- "Apple needs a board that goes in and does a huge buyback. We are saying that. I respect Tim Cook and I expect to talk to him again very shortly and I think he is doing a very fine job."

- Apple should buy back $150 Billion in Stock

- To critics of the Apple buyback: "[they] have not bothered to read the balance sheet or maybe does not know how to read a balance sheet."

- Tim Cook believes the stock is very Cheap

- Not looking for a quick turn in Apple

Icahn also said on JC Penney: "we have stayed away from years. And we continue" and on Netflix: I can only say that my son and Dave, his partner, have certainly earned a say in what they believe we should hold or not, and I do not think they are wrong with what they said in that press release. Basically, Netflix is a great company, but, you know, as I said, I have been a veteran, and a battle hardened veteran of seven bear markets, and, therefore, there comes a time when you are making 500% on your money that you take your chips of the table…. I think Netflix has a great model. But I did take some chips off the table."

Note: Some of the text below has been automatically generated. It may not be 100% accurate.

Icahn on recent criticism of the potential apple buyback program:

"I think that some of the critics that you listen to are just absurd. I just heard someone say that Apple might need the money for other things. That is tantamount to saying that Bill Gates should not fix his house because he needs the money for charity. They have so much cash, with no ballroom, how can you possibly have that type of criticism of a buyback? They might need the money for other things? Apple is not a bank and shareholders did not ! buy the stock to be a bank. We have no complaints about the management and what they are doing with technology, but there is no one on that board who really had a great knowledge of fiancé as far as I can see, but maybe I am wrong on that, I do not want to start a new war. I will say this, to a list criticism saying that they need money for other things, it is idiotic. Or it is a complete lack of reading a balance sheet."

On why he thinks a buyback program is something Apple needs to be doing right now:

"I think a company and its board should do everything they chance to enhance value. This is what you call a no-brainer. At the risk of being a modest, we have the best record by far over the past 12 to 13 years and it is done because of activism and because we proved over and over that you can go into companies and make management accountable or change them, which the boards are lax in doing. If that were done more and the law allowed for it more, we could not have the problems."

"Look, the market is up right now, but I believe the market is up not because our companies are doing that well but because interest rates are ridiculously low and as a result is companies are making money, but making it the wrong way. Jobs? There are no jobs. The jobs are very scarce. Therefore what you need are companies that are better run. I will say that there are many well-run and great companies. Apple, I believe, is managed well, but the board is not doing the job they should be, take this cash that is making them no money, or borrow, which is the same thing, if you get into financial engineering. If you borrow money at 3-percent, which they can do, they can buy stock that returns 16-percent. It is a no-brainer. To have critics say that you should leave Apple along because they aren't icon and because of this and that, they have no knowledge of how to read a balance sheet. They have plenty of money to do anything they want, even if they did the buyback. The interest alone would purchase $150 ! Billion. ! It is absurd to make this kind of criticism. I will obviously not tell you what is in the letter, but you can judiciously guess that we are not leaving Apple, we are there to stay and our record shows that we have been very successful in the last 12, 13 years going in, cleaning up companies that need to be cleaned up or changed. I think that Apple needs a board that goes in and does a huge buyback. We are saying that. I respect Tim Cook and I expect to talk to him again very shortly and I think he is doing a very fine job."

"I would think that Tim would not want to talk to me until his earnings come out, and I would respect that."

On whether the model will have to change and Tech companies that are averse to debt will need to adopt new models where they take on debt:

"There is a time to borrow and time not to. But I do not want to digress from what you are really asking. If the company has $150 Billion cash, there is nothing wrong with them borrowing. They are sort of borrowing against the cash in because they cannot repatriate it. Borrowing there is not the same as borrowing money and leveraging your balance sheet, in a sense. It is a completely different equation or dynamic. We are not talking about it being wrong tomorrow. That is a different question that you could argue. Here you are not a bank, sitting on $150 Million. The stock is so low on value related to earning, related to the $50 Billion cash flow, it is patently absurd not to buy it."

"I owned a bunch of oil wells in 2000. There was a partner that we had, and the partner wanted to sell for one reason or another at a very cheap price. Well, he was nice enough to offer them to me. It is no different with Apple. Apple is selling their stock. Apple stock is selling at a very low price. Why should the shareholders not get the benefit of that if they have another buyer? I get the benefit of buying stock as opposed to Apple getting it."

On how big of a buyback does Apple need:

"We have recommen! ded sever! al times, $150 Billion. We are making a bunch of pledges in the leter, and I think you will find it very interesting. I think it will stop any criticism saying I am just looking for a quick trade. We do have a good profit in Apple, but that could not be further from the truth. To do in and make a quick turn here. We do not really. In many cases, look, we held Netflix while others sold it. I am not saying they were wrong. I am saying we held Netflix, well, it was only 13 months, but it went five times higher before we sold it, so we are not in for the quick turn. They need money for other things. They have not bothered to read the balance sheet or maybe does not know how to read a balance sheet.

On why he is active in a large company like Apple where it is harder to have a voice:

"I am not sure of that. I saw somebody have a pretty big voice with Procter & Gamble. I think on this one point, we can have a voice because it is so absurd not to have a buyback, and we are not criticizing Tim Cook. I am not sure we cannot have a voice there. A lot of shareholders have called us and have said 'Right on. Right on. Get the deal done.' We do not represent a number. If shareholders say, do not do the buyback, that is one thing, but to listen to the commentators go on about it, it is amazing to me. I do not mind people criticizing doing it for other reasons, but just to say that Apple cannot afford it because they need the money for other things is patently absurd. It is saying that activism in the right way does not work. Just look at our record, and look at how many companies we have cleaned up. It is not that we just trade stocks. We have held stocks for years and years and years, and the trouble with the company and with the economy is we protect management doing a bad job. I believe in really enhancing value, but I will say that I think I am not the only one that believes that, and if that is true, hey, let it be, you know."

On whether Tim Cook is willing to give on this:

"I ! cannot ta! lk to Tim. I have met him. I find he is doing a very good job. This is not a criticism of him. I think he believes as strongly as I do that the company is undervalued. Therefore, you can deduce from that, or you should be able to that if the company's stock is very cheap and I have $150 billion, why do I not use some of it to buy the stock? It makes no sense. Tim. He is not going to run ahead of his board. I know he believes the stock is very cheap, as I do."

On other institutions that are coming forward saying "Yes, This makes sense:"

"There is a fact that so few institutions speak out, and I think it is a sad fact. I think institutions should get a lot more active in making their companies more accountable and making management more accountable. Hey, tomorrow, when we come up with this, we are going to come up with Twitter followers, going on what I am calling the shareholder square table. There is an interesting thing in the beginning of it, and there will be some interesting things, one of the articles will be the letter, and we hope people join the square table. You subscribe. You do not pay money for it. You sign in for it. You will see something I think you will find very interesting, which is sort of a depiction of how a lot of our companies are, and it is a sad commentary that these companies do not have accountability and are not really that focused on enhancing shareholder value. Again, there are many good companies, many good boards, and we are not in any way criticizing Tim Cook here. We agree with what he is doing as far a coming out with all of these new iPhones and what I have you, but that is not what the criticism is about."

On whether he has spoken to David Einhorn about Apple:

"I am not at all going to discuss what is talking to me about in private. I am not talking about any other institutions by name, but there are a lot of shareholders that have spoken to us and think we are right. Now, that does not mean they are going to vote for us or vote ! for this ! or what have you, but that is what I do believe."

On the Shareholder Square Table:

"Twitter followers can get on tomorrow, and, again it has a few different articles, and it will continue to have articles. I think the time might have come in our economy where shareholders want to stand up a little bit more to what goes on, and to say that we are just doing this to enhance our own portfolios is another ridiculous thing, because we own things for years and years in certain cases. Look at how well we have done for the companies over and over that we have been involved with, and look at how they have changed."

On whether he purchased a stake in JC Penny:

"We do not elaborate too much on positions. That was an example of activism, where you micromanage, and we do not presume to micromanage. I am not going to say anymore about that except, we have stayed away from years. And we continue."

On how Netflix is playing out, given that his son is a big believer:

"I can only say that my son and Dave, his partner, have certainly earned a say in what they believe we should hold or not, and I do not think they are wrong with what they said in that press release. Basically, Netflix is a great company, but, you know, as I said, I have been a veteran, and a battle hardened veteran of seven bear markets, and, therefore, there comes a time when you are making 500% on your money that you take your chips of the table. Some of them, anyway. And that is really why I did it, that I think Netflix, actually, if I had not had the position, I probably would have kept it. I think they are right in most of their arguments, but that does not mean, I mean, there is a different way to looking at life or investing life and I think for Apple to have this huge position, and the position obviously by dent of the investment got much bigger, so it got to be a larger percentage of the portfolio, and I do not know if it is judicious to have one company with that large of a percent in a portfolio, ! and you h! ave to worry about just, as I say, I have been through a bunch of bear markets, and when they come, they are not pretty things."

"…They only different is Netflix, which is say again, I basically agree with their argument, but I still did it, so that is what I think of Netflix. I think Netflix has a great model. But I did take some chips off the table."

**CREDIT: BLOOMBERG TELEVISION**

Wednesday, October 23, 2013

High-tech blunders: HealthCare.gov isn’t alone

Three weeks after it opened, HealthCare.gov — where millions of people are supposed to get insurance under the Affordable Care Act — remains plagued by problems. President Obama has said his administration is doing "everything we can possibly do" to get things fixed. The debacle is just one of many high-tech blunders over the years. Here are just a few:

Y2K

Dec. 31, 1999

Despite cries of a digital apocalypse, no such thing happened as the computer world entered the year 2000. Billions upon billions of dollars were spent, and retired programmers were hauled in to address the Millennium bug, but few things were awry, resulting in a Chicken Little-like scene.

Microsoft Vista

January 2007

Shortly before iPhone debuted in 2007, Microsoft introduced Vista, an operating system packed with security and other bells and whistles. But the timing coincided with a rise in the smartphone, and Vista was dinged for being slow because of bloated features. Plus, Microsoft users were fine with XP, a predecessor of Vista.

Yahoo rejects Microsoft bid

February 2008

In 2008, Yahoo said Microsoft's $44.6 billion takeover offer "substantially undervalues" the Internet icon, and decided to go it alone. While it didn't involve technology, the decision is considered among the worst in Silicon Valley history, accelerating a downturn in Yahoo's fortunes and leading to a dizzying six company CEOs over the past several years.

United, Continental merge computer systems

March and August 2012

United Airlines had problems with its reservations system in early March after it switched to Continental's computer system as the two airlines merged operations. Passengers complained as United struggled for several days to fix problems. In late August, the airline's computer system and website went down causing problems with reservations, ticketing and check-ins.

Apple Maps

September 2012

Some consider the wrong-way directions from Apple Maps last year as ! the biggest failure in the company's storied history. The problems led to executive firings and helped solidify Google Maps as the go-to app for navigating.

HP write-downs

November 2012

Hewlett-Packard's whopping $8.8 billion write-off in its fourth quarter of enterprise information-technology company Autonomy, amid accusations of accounting regularities, was both a financial and public-relations black eye. It came on the heels of an $8 billion charge in August for another HP acquisition, Electronic Data Systems, complicating the turnaround plans of HP CEO Meg Whitman.

American flights held for 2 hours

April 2013

A computer glitch led American Airlines to hold all flights on the ground due to occasional outages in its computer system. American and regional carrier American Eagle canceled 670 flights. The number of cancellations, while significant, was a fraction of the airline's 3,400 flights.

Nasdaq goes dark

August 2013

A major trading glitch knocked out the Nasdaq Stock Market for about three hours Aug. 22. Despite that, all three major U.S. stock indexes finished up that day. The fact that the Dow didn't plunge 1,000 points as it did during the "Flash Crash" in May 2010, coupled with the fact that the glitch appeared to be technical in nature and not cyberwarfare, produced a ho-hum reaction.