Thursday, March 8, 2012

2013 Good Stocks - Has American Capital Agency Become the Perfect Stock?

Every investor would love to stumble upon the perfect stock. But will you ever really find a stock that provides everything you could possibly want?
One thing's for sure: You'll never discover truly great investments unless you actively look for them. Let's discuss the ideal qualities of a perfect stock, then decide if 2013 Good Stocks - American Capital Agency (Nasdaq: AGNC  ) fits the bill.
The quest for perfection
Stocks that look great based on one factor may prove horrible elsewhere, making due diligence a crucial part of your investing research. The best stocks excel in many different areas, including these important factors:
  • Growth. Expanding businesses show healthy revenue growth. While past growth is no guarantee that revenue will keep rising, it's certainly a better sign than a stagnant top line.
  • Margins. Higher sales mean nothing if a company can't produce profits from them. Strong margins ensure that company can turn revenue into profit.
  • Balance sheet. At debt-laden companies, banks and bondholders compete with shareholders for management's attention. Companies with strong balance sheets don't have to worry about the distraction of debt.
  • Money-making opportunities. Return on equity helps measure how well a company is finding opportunities to turn its resources into profitable business endeavors.
  • Valuation. You can't afford to pay too much for even the best companies. By using normalized figures, you can see how a stock's simple earnings multiple fits into a longer-term context.
  • Dividends. For tangible proof of profits, a check to shareholders every three months can't be beat. Companies with solid dividends and strong commitments to increasing payouts treat shareholders well.
With those factors in mind, let's take a closer look at American! Capital Agency.
Factor
What We Want to See
Actual
Pass or Fail?
2013 Good Stocks - Growth 5-Year Annual Revenue Growth > 15% 129.4%* Pass
1-Year Revenue Growth > 12% 176.7% Pass
Margins Gross Margin > 35% 100% Pass
Net Margin > 15% 90.6% Pass
Balance Sheet Debt to Equity < 50% 796.7% Fail
Current Ratio > 1.3 0.06 Fail
Opportunities Return on Equity > 15% 19.8% Pass
Valuation Normalized P/E < 20 9.66 Pass
Dividends Current Yield > 2% 16.4% Pass
5-Year Dividend Growth > 10% 9.2%* Fail
Total Score 7 out of 10
Source: S&P Capital IQ. Total score = number of passes. *Three-year growth rates.
Since we looked at American Capital Agency last year, the mortgage REIT has dropped a point. Dividend growth has slowed and recently even reversed course, which could be a sign of things to come for the company.
Investors have gravitated to mortgage REITs for their outsized dividends. With bonds yielding next to nothing, the double-dig! it yield s that American Capital Agency and its peers offer look exceptionally attractive.
But recently, changing trends are threatening those dividends. In its most recent quarter, American Capital Agency reported lower earnings per share due to a big jump in outstanding shares, and more importantly cut its dividend from $1.40 per share to $1.25 for the first quarter of 2012. The company's interest rate spread fell below 2%, prompting further concerns.
The challenges aren't unique to American Capital Agency. Annaly Capital (NYSE: NLY  ) saw similar drops in interest rate spreads, prompting its own dividend cut. Moreover, Annaly and 2013 Good Stocks - Chimera Investment (NYSE: CIM  ) have started to clamp down on their leverage ratios, which helps make them less sensitive to adverse conditions going forward (but comes at the expense of some profits). Additionally, with new initiatives to help underwater homeowners refinance, prepayment rates could also hurt.
Given its leverage, American Capital Agency is as close to perfection as it's likely going to get. If conditions continue to worsen, though, the company could deteriorate further in the years ahead.
Keep searching
No stock is a sure thing, but some stocks are a lot closer to perfect than others. By looking for the perfect stock, you'll go a long way toward improving your investing prowess and learning how to separate out the best investments from the rest.
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Wednesday, March 7, 2012

Hot Stocks To Buy For 2012 - Pick the one that gained during oil's last runup

Gas prices are skyrocketing � they�re up about 32% or 87 cents a gallon in the last year. Not only do they show no signs of abating, but there is little evidence that consumers are changing their driving habits. Back in 2008 when gasoline hit $4.11 a gallon, consumers started taking public transportation in droves after gasoline prices spiked 30 cents in a month.
�So far, the shocking rise in gas prices has not led to a big driving cutback, according to the New York Times. This means that prices will probably surge over the 2008 record, and it�raises the question of how investors can profit.
Should they buy stock in an integrated oil producer like ExxonMobil (NYSE:XOM) or a refiner like Valero (NYSE:VLO)?
To pick which one, it helps to look at history and the future. To examine history, let’s look at how the two stocks performed from January to July 2008, when oil prices spiked to $147 a barrel. For the future, we compare the price-to-earnings (P/E) ratio of the two companies to their earnings growth rates. The one with the best historical performance and the lowest Price-to-earnings-to-growth (PEG) ratio should win this faceoff. As we’ll see, the outcome isn’t completely obvious.
When it comes to historical performance, ExxonMobil held up better. ExxonMobil fell 7% between January and August 2008 to $80�from $86. During that same period, Valero plunged 57% to $30�from $70. I think the decline in both stocks during a time when the price of oil was rising is an important warning to investors that there can be a big disconnect between the price of oil and how equities react to its changes.
A quick comparison of the income statements of both companies during the first nine months of 2008 reveals that ExxonMobil put in a stronger performance. Valero’s revenue was up 51% to $100.5 billion but its costs — mostly oil — were up 60% to $97.1 billio! n — ; as a result, its net income fell 55% to $2.1 billion.
During that same period, ExxonMobil did better — its revenue rose 37% to $393 billion while its costs climbed 37% to $324 billion — resulting in a 29% net income pop to $37.4 billion.
This analysis suggests that during an environment of rapidly rising oil and gasoline prices, the profits –�and stock market value –�of a refiner are more at risk than those of an integrated energy company. That’s because as prices at the pump rise, people cut back on consumption even though the price of oil going into the refinery remains high — thus squeezing refinery margins. Meanwhile, an integrated energy company is more diversified — and its profits are less volatile.

Despite its inferior performance in 2008, investors seem to be putting a greater value on Valero’s shares than those of ExxonMobil. And Valero has the lowest PEG ratio of the two — I think a PEG of 1.0 means a stock is fairly valued — suggesting it’s relatively cheap.
Here’s how:
  • ExxonMobil 1.76 on a P/E of 13.7 with 7.8% earnings growth to $8.66 in 2012
  • Valero 1.04 on a P/E of 17 with 16.4% earnings growth to $3.43 in 2012
There is, of course, risk in buying energy stocks now. The biggest risk is that the speculators that are driving up the price of oil could decide to take their profits. After all, those speculators control 81% of the trading volume on the futures exchange. Regulators could easily drive them out by requiring them to boost how much money they must set aside for each contract. And the settling of the conflict in Libya could be the catalyst for such an energy selloff.
I�d guess most of the spike from rising oil is reflected in the stock prices of both companies, but ExxonMobil is the safer bet for now.

Great Stocks 2014 - Best Wall St. Stocks Today: CJ,FUJ,HIT,HMC,NIPNY,SNE,NTT,DCM,TM,CHL,CHU,CN,HBC,PCW

Great Stocks 2014 - Stocks:  (CJ)(FUJ)(HIT)(HMC)(NIPNY)(SNE)(NTT)(DCM)(TM)(CHL)(CHU)(CN)(HBC)(PCW)
Markets in Asia were pounded down.
The Nikkei fell .6% to 17,383. Bridgestone fell .6% to 2620. Canon fell .6% to 6350. Fuji Film rose 4% to 4980. Hitachi rose 1% to 810. Honda fell 1.2% to 4750. NEC rose .5% to 610. NTT fell 1.3% to 602000. Docomo fell .8% to 184000. Softbank rose .4% to 2835. Sharp rose 2% to 2055. Sony fell 1.4% to 5550. Toshiba fell 1.3% to 770. Great Stocks 2014 - Toyota fell 1.1% to 7950. Yahoo Japan fell 1.6% to 45200.
The Hang Seng fell 1.7% to 20,160. Cathay Pacific fell 3.4% to 20.1. China Mobile fell 3.2% to 71.6. China Netcom rose .2% to 19.46.Great Stocks 2014 - China Unicom fell 4.7% to 10.48. Great Stocks 2014 - HSBC fell .7% to 142.3. PCCW fell .2% to 4.68.
The KOSPI fell .8% to 1,360.
The Straits Times fell .2% to 3,126.
The Shanghai Composite fell 4.9% to 2,786.
Data from Reuters
Douglas A. McIntyre

Yum Brands tries to appeal to young fast food audience with ads

Yum! Brands (NYSE: YUM), parent of KFC, took some heat from shortening ?Kentucky Fried Chicken? to a three letter moniker. But now YUM appears to be backtracking, putting some faith in marketing KFC founder Col. Sanders to young fast food diners.


To celebrate the 120 birthday of its founder Colonel Sanders, KFC is beginning a yearlong PR blitz to not only reintroduce the fast-food chain?s real-life entrepreneur ? but? to educate the overwhelming majority of young American consumers who think he?s a fake. A new survey of young American adults ages 18-25 found that more than 60% could not identify Col. Harland Sanders and that 52% of them considered his image part of the restaurant?s fake branding.


In fact, Harland Sanders was a real person ? a man who in the 1970s was one of the world?s most recognizable celebrities. At age 65, with only a sixth-grade education and a $105 Social Security check, Sanders turned a Southern restaurant into a multi-million dollar global chicken empire. By 1976, he was ranked as the world’s second most recognizable celebrity after Muhammad Ali. Sander died at age 90.


But the real question behind KFC?s move isn?t whether the Colonel can stand toe-to-toe with Ali again. The question is whether KFC is just going to confuse diners more. When Kentucky Fried Chicken dropped ?Kentucky,? ?Fried? and,? yes, ?Chicken? from its name to become KFC, it was part of a move against greasy Southern identity alongside a push for its healthier-appearing grilled options.


The move that happened slowly through the 1990s has since led to marketing confusion with consumers ? is it healthy chicken offerings or fried-finger-lickin? good? ? and rankled chain owners. The Association of Kentucky Fried Chicken Franchisees blames this and its health-conscience ?unthink KFC? marketing campaign as the reason for poor revenues and a decrease in its customer base. U.S. sales saw a decline of -7% at KFC in th! e second quarter.


It?s worth noting that Yum isn?t the only stock to stumble with rebranding. PepsiCo (NYSE: PEP) still feels the burn from its 2009 (but short-lived) redesign of Tropicana orange juice packaging. In only two months ? with a 20% drop in sales ? the company reverted back to the original logo and branding. As well, Pepsi lost sales with another flagship product redesign ? Gatorade (or G as it is currently called). Volume sales of the sports drink fell 13.7% in the first quarter after the name change.


KFC is now opting to show its history to a public that seems largely indifferent to the man that made fried chicken a national obsession, not just a Southern one. But reintroducing the Colonel may be a little too late.


Though his legacy didn?t die with him, KFC is now ?unthinking? the decision to give it an early funeral. Whether it works and boosts sales, however, is anyone?s guess


As of this writing, Burke Speaker did not own a position in any of the stocks named here.


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Hot Stocks To Invest In 2013 - IvyBot Was Born To Make Huge Profits

IvyBot is the one of the automated Forex robots which has entered the Forex trading market recently. In today’s world, Forex traders definitely need an efficient tool to help them weather the turbulence of the trading world. Ivybot is invented by a group of Ivy League guys, since college they started trading the currency pairs, they have put in their knowledge of financial understanding, mathematics and computer programming to bring out this product. Ivybot is basically the electronic condensation of many-year manual trading experience for the benefit of the general public. They have been using the Ivybot personally and gain profits. Here are a few items enlisting the special features of the trading software.
1. Hot Stocks To Invest In 2013 - Ivybot is made up of 4 separate robots, each robot is specially designed for managing different currency trading pair available in the market. Other systems just have one set of code to do all the calculations of whatever pairs they can handle, but Ivybot has each robot tailored to trade in each currency pair, resulting in four codes. The robot is being updated every now and so with respect to the recent changes present in the Forex market. The web price listed nowadays is about $149.95 which is one-time payment. This automated Forex robot says it can create more than 500 percent of the original deposit in about 190 days in year 2009.
IvyBot works 24/7 always and keep tracking the price movement and market conditions, compared with human monitoring, they are not panicked, affected by greed or read inconsistently. Ivybot has proved its efficiency by having real market as well as backtest results in the field of trading. Not only giving customers unlimited updates, the Forex trading software has also been backtested, optimized, and forward tested, hence it attracts lots of customers to get it and study the market.
Additionally, Ivybot Forex can predict the result of certain trades in the market based on the history of those trades. I! t adhere s to an algorithm that combines variables like forward projection scanning, volatility, technical price patterns, market liquidity, trend analysis, and weighted price action. In this department, Ivybot Forex scored 98 percent. Moreover, Ivybot Forex prides itself in its simplicity. Even beginners can easily absorb the subject in less time as the user manual and video tutorials are included in the package. It’ll cost you $149.95 but it’s money invested wisely as the chances of you trading profitably is high. Also, a free demo version is available.
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