Dividend Stocks To Buy For 2014, Best Dividend Stocks For 2014: October 2014

Friday, October 31, 2014

Morning Movers: Japan Shocker Sends Stocks Soaring; AbbVie Flies on Earnings

Stocks are in overdrive this morning after the Bank of Japan shocked the market by announcing that it would buy more government debt.

Joe Buglewicz for The Wall Street Journal

S&P 500 futures have gained 1%, while Dow Jones Industrial Average futures have risen 1%. Nasdaq Composite futures have advanced 1.5%.

Boston Beer (SAM) has jumped 8.9% to $252 after its earnings easily topped the Street’s consensus due to lower costs and higher shipments.

Western Union (WU) has gained 2.4% to $17.10 after it beat earnings forecasts and said its full year profit would come in at the top of its previously announced range. MoneyGram International (MGI), however, has plunged 12% to $11.14 after reporting a 22 cent profit, well below forecasts for 33 cents.

Citigroup (C) has dropped 0.3% to $52.99 after reducing its previously released earnings due to increased legal expenses.

AbbVie (ABBV) has jumped 4.% to $63.65 after beating earnings, raising guidance and saying that it’s Hepatitis C drug could get FDA approval before the end of the year.

Tuesday, October 28, 2014

Mike Khouw Sees Unusual Options Activity In The Goodyear Tire & Rubber Company

Related GT Benzinga's M&A Chatter for Tuesday October 28, 2014 Deutsche Bank Assumes Cautious Tone Over Auto Sector Heading Into Earnings Auto Parts Makers Drive Higher (Fox Business)

CNBC Options Action's Mike Khouw said on the show that he noticed unusually high call options trading volume in The Goodyear Tire & Rubber Company (NASDAQ: GT) on Tuesday. More than 6 times daily average call options volume was traded and the options market is implying a 7 percent move on earnings.

Traders were buying heavily the January 23 call options for $1, which sets the breakeven for this trade at $24. The Goodyear Tire & Rubber Company closed the session at $21.91 with an increase in price of 6.31 percent and for the trade to be profitable the stock has to jump additional 9.5 percent.

Khouw added that crude oil makes around two-thirds of the company's raw materials so lower oil prices could be a big positive for The Goodyear Tire & Rubber Company.

Posted-In: Mike Khouw Options ActionCNBC Options Markets Media

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Monday, October 27, 2014

4 Big Stocks Getting Big Attention

BALTIMORE (Stockpickr) -- Put down the 10-K filings and the stock screeners. It's time to take a break from the traditional methods of generating investment ideas. Instead, let the crowd do it for you.

>>5 Stocks Ready to Pop on Bullish Earnings

From hedge funds to individual investors, scores of market participants are turning to social media to figure out which stocks are worth watching. It's a concept that's known as "crowdsourcing," and it uses the masses to identify emerging trends in the market.

Crowdsourcing has long been a popular tool for the advertising industry, but it also makes a lot of sense as an investment tool. After all, the market is completely driven by the supply and demand, so it can be valuable to see what names are trending among the crowd.

While some fund managers are already trying to leverage social media resources like Twitter to find algorithmic trading opportunities, for most investors, crowdsourcing works best as a starting point for investors who want a starting point in their analysis. Today, we'll leverage the power of the crowd to take a look at some of the most active stocks on the market today.

>>5 Mega-Cap Stocks to Trade for Gains

These "most active" names are the most heavily-traded names on the market -- and often, uber-active names have some sort of a technical or fundamental catalyst driving investors' attention on shares. And when there's a big catalyst, there's often a trading opportunity.

Without further ado, here's a look at today's stocks.

AstraZeneca

Nearest Resistance: N/A 
Nearest Support: $68 
Catalyst: Pfizer Acquisition Bid

First up is AstraZeneca plc (AZN), the $100 billion drugmaker. AZN is up more than 14% this afternoon after Pfizer (PFE) confirmed that it was still pursuing an acquisition offer following its failed bid in January. At the start of the year, AstraZeneca rejected an acquisition offer that valued the firm at approximately $100 billion, and shares have rallied on hopes that a sweeter deal will come along. That makes for the second straight week of major pharmaceutical M&A activity moving the markets.

From a technical standpoint, AZN started looking bullish late last week thanks to a breakout through $68 resistance. Now that's a support level for shares. Today's price action is a strong indication that buyers are in control here, but the event risk of a lackluster acquisition offer does put somewhat of a damper on AZN's upside from here. More upside still looks probable in AZN, but it's going to be limited by the size of an acquisition price that PFE can swallow.

Pfizer

Nearest Resistance: $33 
Nearest Support: $30 
Catalyst: AstraZeneca Acquisition Bid

Not surprisingly, Pfizer (PFE) is getting its fair share of trading volume on news of the acquisition attempt. PFE is up almost 4% this afternoon, gapping higher as investors anticipate the potential for big combination advantages between the two major pharma firms.

But zoom out a little longer-term, and Pfizer's price action starts to look a little less auspicious. In fact, after rallying hard since the middle of last summer, this stock is starting to show traders signs of a head and shoulders top. The neckline at $30 is the breakdown level for Pfizer; if shares fail to catch a bid at that level in May, then this name becomes a sell.

Charter Communications

Nearest Resistance: $140 
Nearest Support: $120 
Catalyst: Q1 Earnings

Charter Communications (CHTR) is up more than 7% this afternoon, following the firm's first quarter earnings call. The firm lost 35 cents per share for the quarter, widely missing analysts' 10-cent profit expectations. But shares are rallying despite the miss on an earlier announcement that Comcast (CMCSA) will be selling Charter nearly 4 million subscribers. That big change to Charter's business is the context that investors are using to judge this quarter's earnings call.

Technically, Charter has been consolidating sideways in a wide-ranging channel between $120 and $140. So while today's move higher is pressing CHTR against the top of that channel, it still hasn't exited. A breakout above $140 is a buy signal for Charter -- it's a level that buyers haven't been able to sustain beyond intraday.

Bank of America

Nearest Resistance: $15.75 
Nearest Support: $13.75 
Catalyst: Accounting Error

Oops -- Bank of America (BAC) announced that it made an incorrect adjustment on some investments that it acquired long with Merrill Lynch in the wake of the Great Recession. Because of the error, the Federal Reserve is ordering BofA to suspend share buybacks and planned dividend hikes until it resubmits a fresh capital analysis for review. Investors are selling off Bank of America this afternoon, pushing shares down around 5% as I write.

That selling isn't hugely surprising. BofA has been forming a textbook head and shoulders top for the last four months, a bearish reversal pattern that triggered on today's slip through $15.75. Put simply, buyers were exhausted in BAC, and sellers are in control now.

Today's drop isn't a buying opportunity -- it's a warning shot. BofA has more meaningful support down at $13.75.

To see these stocks in action, check out the at Most-Active Stocks portfolio on Stockpickr.  

-- Written by Jonas Elmerraji in Baltimore.

Friday, October 24, 2014

The Urban Outfitters Roller Coaster Continues

It's hard to know just how to describe the ride "stuff"-retailer extraordinaire Urban Outfitters (URBN) has taken investors on over the past few weeks. We're thinking about going with "psychotic roller coaster," but obviously, we're open to suggestions.

Just a few short weeks ago, Urban Outfitters said it planned to double sales by 2020. It also promised an Anthro for every living room. Promises, promises. Then last week, the company made news again. Only this time, Urban Outfitters posted sales that were so awful we used three "reallys" to modify the word “bad.”

More bad news came today after Wedbush analyst Morry Brown revised estimates and cut the price target to $32 from $36. And he didn’t mince words when it came to explaining why:

We do not see a near-term catalyst to drive a positive inflection at either of the company's primary brands. At Urban Outfitters, the lack of improvement in same-store sales quarter-to-date suggests work remains ahead to turn the division. Without a clear catalyst for a return to positive same-store sales, we have limited visibility on the timetable for a turnaround, as the goalposts have been pushed back once again. At Anthro – while the business remains up in the low-single digits, tough comparisons set a high bar. The recent uptick in promotions suggests discounts (though narrow and modest) are becoming increasingly necessary to drive traffic. With uncertainty surrounding both of the company's primary division, we do not see a near-term catalyst for the stock.

Ouch!

We took a look at shares and they're up 2.5% this at 3:02 p.m. this afternoon after falling 18% during the past month of trading.

What would a roller coaster be without a rise after a dip?

Wednesday, October 22, 2014

Is Capitalism's Immune System Strong Enough To Fight Ebola?

I cut my eye teeth with the great value investor Al Frank, and have now passed a quarter century with his namesake firm, working my way up from the proverbial mail room in 1987 to Director of Research in 1989 to Chief Portfolio Manager in 1989. I now serve as the Chief Investment Officer of Al Frank Asset Management (AFAM) where I lead a team that scrutinizes hundreds of stocks for money management clients, shareholders of our proprietary mutual funds and subscribers to The Prudent Speculator investment newsletter of which I am editor. I have appeared on numerous television and radio programs, and I am frequently interviewed by print and online publications while I also conduct workshops at various investment seminars. I graduated magna cum laude from the University of Southern California in 1987 with a B.S. degree in computer science and a minor in business administration.

Contact John Buckingham

The author is a Forbes contributor. The opinions expressed are those of the writer.

Sunday, October 19, 2014

IRS audits less than 1% of big partnerships

WASHINGTON — The Internal Revenue Service audits just 0.8% of large partnerships, according to a new government report drawing bipartisan attention from Congress.

That's significant because the number of those partnerships has tripled over the past decade. Large partnerships held $2.3 trillion in total assets and earned $69.1 billion in income in 2011.

The report released Thursday by the Government Accountability Office defined large partnerships as those earning $100 million or more a year and with 100 or more partners. Of those, 81% are in the finance and insurance industries, and they include entities like hedge funds and private equity funds.

By comparison, corporations with $100 million or more in assets were audited 27.1% of the time. Unlike corporations, the tax liability for partnerships lies with its partners, not the entity itself.

"Auditing less than 1% of large partnership tax returns means the IRS is failing to audit the big money," said Sen. Carl Levin, D-Mich, who chairs the Senate Permanent Subcommittee on Investigations. He requested the report with Sen. John McCain, R-Ariz.

"We literally cannot afford to allow these entities to go unaudited," Levin said. "If congressionally imposed red tape or budget cuts are partly responsible for the poor audit numbers, we need to find that out and change it."

Senate Finance Committee chairman Ron Wyden, D-Ore., said the report shows that Congress needs to get back to the basics to fix the tax system.

"This is a real problem and serves as yet another example of why Congress needs to get serious about comprehensive, bipartisan tax reform," Wyden said.

The Internal Revenue Service did not dispute the findings.

"Auditing partnership returns remains a priority area for the IRS given the increased filing activity in this area," said spokesman Jose Manuel Vejarano. "However, budget reductions over the past few years have severely limited our work in this area."

The agency's budget has been cut b! y $900 million since 2010. There are 10,000 fewer employees — 3,100 of which came from enforcement.

In 2010, 2.2% of large partnership returns received field audits, the GAO said.

The IRS looks at far more returns under a "campus function audit," the report said. But unlike field audits, "they generally do not entail a review of the books and records of the taxpayer return in question," said James R. White, the GAO's director of tax issues.

Follow @gregorykorte on Twitter.

Saturday, October 18, 2014

30 Undervalued Stocks For Patient Investors

Contact John Buckingham

The author is a Forbes contributor. The opinions expressed are those of the writer.

Thursday, October 16, 2014

H.C. Wainwright Analyst Jeff Wright Names Three Companies that Could Turn the Gold Trend Upside Down

The Gold Report: What do the Fed's recent statements about the timing of possible future interest rate hikes mean for the price of gold?

Jeff Wright: The Fed is almost finished buying mortgage-backed securities in an attempt to stabilize the market. We anticipate it will gradually increase interest rates by Q2/15. The most recent Federal Reserve minutes showed that there is no real drive to accelerate that pace. We will probably see low interest rates for the foreseeable future. Anything more is just not feasible, given the level of U.S. governmental debt. We would have to dedicate as much as three-quarters of the U.S. budget to interest payments if rates were to go back to normal historic levels.

"Pretium Resource Inc. has done a very good job managing the Brucejack project."

It has not been pretty for gold over the last few months. The recent selloff in gold was predicated on a stronger dollar more than anything else. Anticipation of a rise in interest rates has also played into the strengthening dollar. And new quantitative easing in Europe and Japan just add to the relative strength of the dollar over the euro and the yen.

TGR: Some experts we interviewed told us that the extreme negative sentiment toward gold is a sign that we are at a bottom and getting ready for a turnaround. Even former Federal Reserve Chair Alan Greenspan has made bullish comments about gold. Are you seeing indicators that gold is ready to turn again?

JW: Picking bottoms or tops is not for the faint of heart. Even the most researched call can easily be wrong the very next day. It is a function of a global price commodity that trades 24/7 that one headline can change the price dramatically. While gold has supply and demand fundamentals, it has emotional characteristics as well. It's not as rational or as forecastable as other investments. That is why I look for sustained trends. One of those is the demand for physical gold from China, which is down since 2012. I am not confident that Chinese buyers will come in this time to keep gold above $1,200 an ounce ($1,200/oz). And we will have to see how the traditional Indian wedding season plays out.

I think Greenspan's recent comments in an article in Foreign Affairs about the possibility that China is buying gold in an attempt to make its currency convertible to gold are a shot across the U.S. bow. We need to get our financial house in order because the level of deficits that we've had for the past 10 years is not sustainable. That is probably not the greatest news for the U.S. economy, but it could be a good sign for gold long term.

TGR: In the short term, if the gold price is range bound, which is what you said in your last interview, how are junior miners adjusting their operations to be successful?

JW: Companies are attempting to reign in labor and energy costs. They are more selective of what material they're putting through the mill and what material they're stockpiling for higher gold prices down the road. Some projects are being selectively mined for higher-grade material. The survivors will be the companies that can extract savings from operations while limiting discretionary exploration. That is going to come back around to impact the industry in a couple of years when there is a dearth of exploration for organic growth and acquisition potential. But for now, there is just not an appetite for true exploration. Even positive news is being met with a shrug.

TGR: Would you say that the funded developers are in the best position because they can move forward with the hope that by the time they go into production the gold price will be higher?

JW: They certainly are in a better place than an unfunded developer, because the equity markets just are not there right now for large capital requirements. A number of companies are slow-walking projects into a production decision to avoid mining a project at close to a breakeven point.

We are seeing merger and acquisition activity around the edges, but not a full scale movement toward some of the juniors being acquired and going away, at least not yet.

A bigger trend on the horizon is broader industry consolidation. Some large companies have been selling assets. One example is Barrick Gold Corp. (ABX:TSX; ABX:NYSE) and Goldcorp Inc. (G:TSX; GG:NYSE) selling the Marigold project to Silver Standard Resources Inc. (SSO:TSX; SSRI:NASDAQ). That is a good project, but it didn't make sense for the two larger companies.

TGR: Let's talk about some of the companies that you have under coverage.

JW: One of the companies I cover is Pretium Resources Inc. (PVG:TSX; PVG:NYSE)(Rated: Buy). I conducted a site visit in August of its Brucejack project in northern British Columbia. The company has done a very good job managing the project, increasing the size and the quality of the reserve. The grades there are phenomenal. It is a near-surface, underground mine, so the development is not that expensive. The company has to raise approximately $700 million ($700M), but the updated feasibility study shows the project is still quite profitable at $1,200/oz gold.

TGR: How will Pretium raise the capital for mine construction?

JW: It will probably be a mixture of debt and equity, but with the scale tilted more toward debt. I don't see management wanting to overly dilute the project. I think that's a really good example of management not trying to unnecessarily accelerate development. Pretium is letting the project play out. It's looking to grow a true mining company with a good resource base and a reserve that will be mined with outstanding economics for 15–20 years. $700M is a large number to fund, but it makes sense based on the grade and the tonnage that the project can sustain.

TGR: Is permitting going to be a challenge?

JW: The project is on track to get its permits by the middle of 2015. Brucejack doesn't have the environmental concerns of some other projects. It's in a fairly isolated place with no major water or wildlife issues, and management has a good relationship with the First Nations in that area of British Columbia. It's a mine that makes sense.

TGR: What is another company that you think is doing a good job?

JW: One that the market has not caught on to yet is Gold Standard Ventures Corp. (GSV:TSX.V; GSV:NYSE)(Rated Buy). It has the Railroad-Pinion project in north-central Nevada on the Carlin Trend. The company has successfully consolidated the project and conducted a confirmatory round of drilling. It recently released a maiden NI-43-101-complaint resource calculation that shows about 1.4 million ounces gold in the Indicated and Inferred categories, as well as a little bit of silver. It has fairly shallow mineralization and could be an open-pit, heap-leach mine in the 2016–2017 timeframe with little technical risk. It is in the right neighborhood, with infrastructure and a ready-made workforce in close proximity. The permitting is straightforward. The next round of drilling is underway as management looks for extensions at depth and along strike. This company is moving the ball forward with a relatively low capital budget on the exploration and development side. It is still a couple of years out, but it is certainly interesting.

TGR: You initiated coverage with a 12-month target of $1.75/share. What do you think is going to take it there from its current price of $0.73/share?

JW: I think the market doesn't have a full awareness of the fundamental characteristics of the deposit and the timeline to production. Gold Standard released its resource estimate right as people were rotating out of gold, and that was just bad timing.

TGR: How about one more company?

JW: I visited Richmont Mines Inc.'s (RIC:TSX; RIC:NYSE.MKT)(Rated Buy) Island gold project in Ontario in April. This producer just raised its annual guidance from 75,000–85,000 ounces (75–85 Koz) to 85–90 Koz by mining deeper into a higher-grade area. The company is building out additional underground infrastructure to access the higher-grade stopes. A new CEO, Elaine Ellingham, stepped in on an interim basis and she has really jump-started the process. The focus is on increasing production and profitability while making investments on the exploration side.

Richmont stock was close to $1/share earlier in the year and now it is over $2/share. The past month has not been exactly kind, but then the stock may have gotten a little bit ahead of itself. It is starting to look as if it will have a sustained recovery based on earnings announced in August and this more aggressive approach at Island Gold. This is a company that has made the hard choices. It has invested in its project and now just needs to effectively operate and deliver.

TGR: Any words of wisdom you might have for investors looking to survive, maybe even thrive, in the natural resources space today?

JW: When evaluating a project, you have to ask some key questions. First, is the project a sustainable mine over the long term, even with low commodity prices? I would shy away from companies with projects that require higher gold prices to make sense.

The second element is whether the mine is permitable and in a good jurisdiction. A no to either of those questions is a nonstarter for me.

Finally, has the management team proven it can run an effective mining company? You have to have competent management that can achieve their production goals and meet operational guidance.

TGR: Thank you for that advice.

Jeff Wright of H.C. Wainwright & Co. has more than 15 years of capital markets experience. Previously with Global Hunter Securities, Wright has also worked as a managing director and head of the natural-resource practice at Shoreline Pacific LLC. Prior to that he was vice president at Montgomery & Co. and was a leader on the team that launched a capital markets business in a historically mergers and acquisitions-focused investment bank. Wright was formerly a vice president at Robertson Stephens in the equity financial products group. Wright received his Master of Business Administration from the University of Southern California and his Bachelor of Arts degree in political science from North Carolina State University.

Read what other experts are saying about:

Pretium Resources Inc.

Want to read more Gold Report interviews like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see recent interviews with industry analysts and commentators, visit our Streetwise Interviews page.

DISCLOSURE:
1) JT Long conducted this interview for Streetwise Reports LLC, publisher of The Gold Report, The Energy Report, The Life Sciences Report and The Mining Report, and provides services to Streetwise Reports as an employee. She owns, or her family owns, shares of the following companies mentioned in this interview: None.
2) Jeff Wright: I own, or my family owns, shares of the following companies mentioned in this interview: None. I personally am, or my family is, paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned: Pretium Resources Inc., Richmont Mines Inc. and Gold Standard Ventures Corp. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I determined and had final say over what companies would be included in the interview based on my research, understanding of the sector and interview theme. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
3) The following companies mentioned in the interview are sponsors of Streetwise Reports: Pretium Resources Inc., Richmont Mines Inc. and Gold Standard Ventures Corp. Goldcorp is not affiliated with Streetwise Reports. Streetwise Reports does not accept stock in exchange for its services. The companies mentioned in this interview were not involved in any aspect of the interview preparation or post-interview editing so the expert can speak independently about the sector.
4) Interviews are edited for clarity. Streetwise Reports does not make editorial comments or change experts' statements without their consent.
5) The interview does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer.
6) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview until after it publishes.

( Companies Mentioned: GSV:TSX.V; GSV:NYSE,
PVG:TSX; PVG:NYSE,
RIC:TSX; RIC:NYSE.MKT,
)

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Commodities Markets

Originally posted here...

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Tuesday, October 14, 2014

#Premarket Prep Technical Update - S&P 500 Index Futures Make Low

Related SPY More Downside on the Horizon for Stocks, Cramer Says Carl Icahn Tells CNBC There Will Be A Major Correction in The Market

S&P 500 Index futures are trading lower by 15.00 points at 1812.00 in Friday's session. The index has just breached its previous low for the day at 1813.25. If the decline continues, there may be minor support at its February low (1810.25) and major support at its February 13 low (1795.25).

Posted-In: Futures Technicals Intraday Update Markets Trading Ideas

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Monday, October 13, 2014

Yesterday's Fed News Will Trigger Great Stock Buys… Just Not How It Intended

I have long said that the Fed has never met a printing press it didn't like nor a dove that it didn't want to set free in the name of higher stock prices. And, yesterday, yet again, Yellen proved it.

Within minutes of releasing its latest set of notes hinting that the Fed will keep rates near zero, the S&P 500 took off on a 34-point gain that is the biggest so far this year. Moving first 45 points from its low of 1,925 to its peak of 1,970 in less than five hours (it later settled slightly lower), the index shrugged off the prior day's losses amidst global growth concerns and weaker European economic data.

This is manipulation of the highest order. It's also proof positive we NEED a correction. Now more than ever.

A lot of investors will take issue with me on this and I don't blame them one bit - corrections are scary. But, they are also essential when it comes to big returns.

1. Down Markets Aren't a Big Deal

People forget that nothing goes up forever. The reason why recent market conditions felt so strange leading into the Fed's announcement is that the current bull market has been on a five-year run since March 2009, thanks almost entirely to the Fed's meddling. The irony is itself ironic.

Less than a decade ago, we used to see 200-point days in both directions regularly. If anything, the fact that we've gone more than 1,042 calendar days without a 10% correction at this point is what's abnormal.

As bad as it felt coming into Wednesday's trading, the downdraft was child's play. The S&P 500 dropped 16% in 2010 and nearly 20% in 2011, both far more in the red than what we've seen in 2014.

2. Investors Are Beginning to Understand Risk Again

That's important because risk weeds out the weak money. What I mean by that is that there are lots of people who think they are investing in the markets and they talk a good game. But, in reality, they're speculating.

So when the going gets tough, they get going. They're the ones who have their fingers on the "sell" button and for whom a 1% drop is enough to give them heart palpitations. I've seen thousands of 'em over the years and they have no business whatsoever being in the markets. Sorry to be so blunt but the markets are about profits and success, not roulette wheels and games of chance.

Savvy investors, on the other hand - i.e. the strong money - wade in knowing that great companies are being put "on sale." They are fully prepared to reconcile short-term gyrations with the long-term perspective needed to bag profits consistently. They're net buyers every time there's a downdraft.

3. Capital Is a Creative Force

That means downdrafts are really nothing more than a glaring signal that there will be more buyers ahead in the next bull market rally. People always ask "When?" but that's largely irrelevant if you're lined up with globally unstoppable trends backed by trillions of dollars. But you've got to have them periodically. All gain and no pain is a political tune, not an economic reality.

Think about it for a moment - everything that's driven this market for the past several years is in place today to drive the markets higher after it blows off some steam.

Fundamentally, the U.S. economy has cracks so large in its foundation that you can drive a garbage truck through them. The World Bank's recent pronouncement about slowing growth is three years too late. That's not news. That's a bunch of analysts looking in the rear view mirror. The best CEOs are looking forward and they're investing in the future, not pulling in their horns. Earnings will follow and so will stock prices ultimately.

Inflation is under control officially. Unofficially, of course, we know that's not true. My breakfast costs 60% more now than it did a few years ago. Medicine, education, insurance... they've all skyrocketed. More importantly, though, all that money is flowing to somebody's bottom line. It may as well be yours...

Profits in large caps remain solid. Sure they're slowing, but business, like the markets, is a process of cycles. Companies come and go all the time. Winners make it big for a while then retrench as upstarts enter the markets and displace them. Remember Kodak? Eastern Airlines? Myspace?

The Fed is nervous and, as I have said repeatedly since the Financial Crisis began, highly politicized despite Washington's insistence that it's independent. Frankly, I'd hate to see their definition of "dependent" under the circumstances but that's a story for another time.

What matters is that the Fed will implement another round of QE at the slightest provocation - reality be damned. Ebola, ISIS, and Europe will see to that. So will Washington's glad-handing politicos, especially those up for re-election. Yesterday's Fed minutes are de facto proof that the much ballyhooed Bernanke "put" is stronger than ever on Yellen's watch.

4. The Stock Market Darlings Are Getting Clobbered

I've made a huge stink for years about the importance of buying companies that offer goods and services people "need" as opposed to those that are merely convenient or "nice to have." That's because the nice-to-haves will get creamed when the markets pitch a fit.

And the market has made my case for me in recent days by punishing fad-oriented companies like Soda Stream International Ltd. (Nasdaq: SODA) and GoPro Inc. (Nasdaq: GPRO), for example. Big brands like Monsanto Co. (NYSE: MON) and Becton, Dickinson and Co. (NYSE: BDX), on the other hand, are doing just fine even though they came under pressure with the broader markets, too.

If you're tempted to bail out or put your head in the sand with a sign on your rear that says "kick me when it's over" I get that. I'm human, too, and I feel the angst you do. That's natural.

What's different for my Money Morning readers is that we know this too shall pass and, when it does, there's going to be a lot of money created.

So, get the Fed out of the way and bring on a correction!

Give me Apple (Nasdaq: AAPL) stock at $70, Tesla Motors Inc. (NASDAQ: TSLA) stock at $200, and Alibaba Group Holding Ltd. (NYSE: BABA) at $80.

Buy low and sell high - that's how markets work and how profits have always been made.

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Friday, October 10, 2014

5 Things You Didn't Know About McDonald's Monopoly Game

www.mcdonalds.com Monopoly is back at McDonald's (MCD). The world's largest burger chain has revived its annual promotion, and Big Mac lovers have until Oct. 27 to collect game stamps themed to Hasbro's (HAS) Monopoly board game. It's a big deal, and McDonald's can use the extra attention. The fast-food chain has posted negative year-over-year comparable-restaurant sales in nine of the past 10 months. Let's look at some of things that you might not know about the four-week promotion. 1. You Don't Really Win $1 Million in Real Dollars The top prize is once again a $1 million prize if a customer nabs the Park Place and Boardwalk pieces. However, the lucky winner had better not go on a $1 million shopping spree. Tax considerations aside, the winning prize is actually an annuity -- $50,000 every year for the next 20 years. That does add up to $1 million, but you have to factor in inflation. The actual value of the $1 million prize in today's dollars is closer to half that sum. 2. The Odds Are Very Long for the Grand Prize The odds of finding Park Place are 1 in 11, but the odds of finding Boardwalk are 1 in 651 million. So your chances of getting them both to win the $1 million grand prize are about 1 in 3.5 billion. 3. Yes, There Was a Cheating Scandal Big prizes draw big attention, but they also bring out the worst in scammers. In 1995, a head of security for the marketing company running the promotion started to steal the top prizes. He would then pass them along to associates in exchange for a piece of the action. By the time it was uncovered a few years later, this multi-state crime ring had claimed $20 million in prizes. Eight people were ultimately arrested. Realizing that it had a public relations nightmare on its hands, McDonald's acted quickly. It announced that it would be dishing out an additional $10 million in prizes in the next installment of the Monopoly promotion. That seems to have done the trick. Consumers flocked back to the Golden Arches during the promotion, and McDonald's has yet to be connected to another internal security breach. 4. McDonald's Doesn't Host the Promotion at the Same Time Every Year In a world of seasonal rollouts -- from pumpkin spice lattes in October to eggnog shakes in December -- McDonald's favors late September to launch this annual promotion, which had its debut in 1987. It ran that way in three of the past four years, but last year, facing weak store-level trends, McDonald's rolled out the game in mid-July to give sales a much-needed lift. This could be a good thing for McDonald's investors. After all, when it does put out same-restaurant sales for October come early November, it will be comparing the Monopoly-backed traffic boost of this month pitted against the Monopoly-less October of 2013. 5. You Have a Pretty Good Chance to Win -- By Design Prizes like the $1 million annuity and a Cessna jet vacation may draw the attention, but your odds of walking away a winner are a spiffy 1 in 4. Most are instant-win prizes, and that usually means free food. It's a smart move. Folks don't get discouraged because repeat customers can feel confident that they will eventually win , and since they have to come back to redeem those free drinks, sandwichs, or fries, that virtually ensures another visit during which the patron will likely spend money in addition to claiming their prize item. Everyone's a winner, including McDonald's. More from Rick Aristotle Munarriz
•Olive Garden Will Have a Lot to Prove on Friday •No Joke: I Invested In an Improv Comedy Theater •Last Week's Biggest Stock Movers

Thursday, October 9, 2014

David Herro Comments on Intesa Sanpaolo

Intesa Sanpaolo (MIL:ISP), an Italian retail and commercial bank, was the top contributor to performance over the past 12 months, returning 50%. Intesa's share price has rebounded as fears over Italy's banking system and government have subsided. We have always believed these fears were overblown and that Italy was in much better long-term fiscal health than many of its periphery countries. The new CEO has committed to return EUR 10 billion to shareholders via dividends over the next four years. This constitutes a cumulative payout ratio in excess of 70%. Even with this return of capital to shareholders, Intesa should be over-capitalized compared with Basel III requirements, leaving the door open for additional capital returns. Additionally, management plans to increase investments in fee-based businesses, including asset management and insurance, and to exit non-core businesses and investments. We believe management has a solid plan for the future and believe the investment will continue to provide value for our shareholders.From David Herro (Trades, Portfolio)'s Oakmark International Fund Third Quarter 2014 Letter.Also check out: David Herro Undervalued Stocks David Herro Top Growth Companies David Herro High Yield stocks, and Stocks that David Herro keeps buying

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Friday, October 3, 2014

Are Video Game Movies a Golden Opportunity for Sony, Microsoft, and Nintendo?

Adaptation is big business in the film industry. Movies based on comic book properties have shaped the box office over the past decade, and Disney alone since 2008 has generated more than $7 billion in global ticket sales with films in its Marvel Cinematic Universe. If that's not a convincing argument for the financial benefits of familiarity, consider that seven of the top 10 highest-grossing films in history trace their roots to storytelling mediums other than the silver screen. One of the films not to fall into that category is Titanic, with Avatar and Frozen standing as the only other entries in this upper echelon not to have a basis in another medium or historical event.

Take the proven track record of success with adaptations and the fact that video games have never been bigger or more culturally relevant, and it's no surprise that studios are hoping to bring popular gaming properties to the cinema. Previous attempts have mostly fallen short of blockbuster status, but the coming wave of game-to-film projects suggests studios are confident there will be a bigger audience this time around. What do such projects mean for platform holders such as Sony (NYSE: SNE ) , Microsoft (NASDAQ: MSFT ) , and Nintendo (NASDAQOTH: NTDOY ) ? Let's take a look.

Sony bets big on video game movies
Of the three console manufacturers, Sony looks to be banking most heavily on converting successful gaming series to blockbuster films. This isn't surprising, as it is the only one of the three to have a film business, but a new batch of game movies might also be a sign of shifting strategies within the company. Sony's recent $1.7 billion writedown, and subsequent stock collapse, developed from weakness in its mobile unit, which had previously been touted by President Kazuo Hirai as one of the company's chief avenues to success. A smartphone business that looks increasingly inept puts added pressure on the company to rely on, and grow, its media businesses. At the same time, Sony's Amazing Spider-Man 2 did not live up to studio expectations and failed to match the earnings of its predecessor, a major stumble because "Spider-Man" is the company's most important film property.

An adaptation of the popular Uncharted series from premier Sony first-party developer Naughty Dog is scheduled to hit theaters in June 2016, replacing Amazing Spider-Man 3 after the Spider-sequel was delayed to a 2018 release. A film based on Sony and Naughty Dog's The Last of Us is also in development at the company's Screen Gems studio, and a movie based on the console maker's Ratchet and Clank series should bow in 2015. Sony's ability to find cross-medium success reminiscent of what Disney has accomplished looks increasingly crucial to its future.

Do Microsoft and Nintendo aspire to be movie stars?
Compared to Sony, Microsoft and Nintendo look to be taking slower, possibly more cautious approaches to the silver screen. Microsoft's $2.5 billion acquisition of Minecraft and its developer, Mojang, now finds the company very interested in the reception of Time Warner's live-action film based on the game, but the closing of Xbox Entertainment Studios and production of a Halo digital series after years of rumors about a big-screen effort indicate the company is still trying to find the right way to maximize the value that its properties add to its businesses.

Meanwhile, Nintendo is seemingly taking hesitant steps forward in using its characters in other mediums that could portend big things for the company. Legendary game developer Shigeru Miyamoto is reportedly set to debut a series of short films based on the company's Pikmin game series at the Tokyo International Film Festival later this month. Miyamoto has also expressed interest in attempting to fundamentally change the movie watching experience, perhaps by incorporating viewers' 3DS consoles to make it more intereactive.. As the company's hardware business continues to look vulnerable, Nintendo aims to redefine its offerings while still retaining its core elements. Bringing its characters to new mediums is likely necessary for its long-term success.

Is it reasonable to expect gaming properties to deliver superhero-like performances?
Sony, Microsoft, and Nintendo aren't the only gaming industry players interested in big-screen performance, as publishers Activision Blizzard and Ubisoft are also involved in delivering movie versions of some of their biggest properties. The number of game-based films in development suggests an optimism that deserves some cautious evaluation. Big-budget attempts to transition hit properties to new mediums aren't without risk, and the desired synergistic benefits must be considered alongside the possibility that new ventures will damage the core property.

There are also strong reasons to doubt whether video games are a good basis for blockbuster films. Having compelling characters is a big part of success at the box office, and what makes characters and experiences engaging is not wholly congruous across narrative and game-centric mediums. This is part of the reason Nintendo has historically been cautious about bringing its characters to the movies. It also helps to explain why Disney's Wreck-It Ralph is the top-grossing "video game" movie to date. Wreck-It Ralph is set in the video game world and includes cameos from notable real-world gaming characters, but its star is an original character written and designed for the silver screen.

Apple Watch revealed: The real winner is inside
Apple recently revealed the product of its secret-development "dream team" -- Apple Watch. The secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see where the real money is to be made, just click here!