The Reasons Behind Teradata's (TDC) Tumble on Wednesday

Best Stocks To Buy For 2014

NEW YORK (TheStreet) -- A mere six weeks after downgrading Teradata (TDC) to equal weight, Morgan Stanley has grown even more bearish. The investment firm cut its rating of the big data tech company to "underweight" with a price target of $36.

"Growth slowed in 2013 and is unlikely to [re-accelerate] in the foreseeable future due to cyclical and secular headwinds," it wrote.

The bank sees potential challenges ahead as cheaper cloud services muscle into the data storage space, and as deals with larger corporate customers lead to inconsistent and delayed returns. Increased competition will also lead to growth and pricing margin pressure and Morgan Stanley doubts the company has enough traction in the mid-market to survive the threat.

"With the exception of Teradata's Aster Data and Hadoop business, which makes up $30 million, or 1% of revenue, the majority of revenue is at risk to customers looking for cheaper alternatives, which is likely to limit [Enterprise Data Warehouse] (EDW) growth," the bank said. In October, the Dayton, Ohio-based business forecast full-year net income between $2.70 and $2.80 a share, well below previous consensus from Thomson Reuters of $3.05 a share. Shares have tumbled 6.3% during Wednesday trading to $42.50. Year to date, the stock has fallen 31.3%. TheStreet Ratings team rates Teradata Corp as a Hold with a ratings score of C+. The team has this to say about its recommendation: "We rate Teradata Corp (TDC) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, weak operating cash flow and deteriorating net income." Highlights from the analysis by TheStreet Ratings Team goes as follows: The revenue growth came in higher than the industry average of 22.6%. Since the same quarter one year prior, revenues slightly increased by 2.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share. TDC's debt-to-equity ratio is very low at 0.13 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, TDC has a quick ratio of 1.95, which demonstrates the ability of the company to cover short-term liquidity needs. The gross profit margin for Teradata Corp is rather high; currently it is at 59.61%. Regardless of TDC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 14.71% trails the industry average. Net operating cash flow has decreased to $64 million or 40.18% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower. Looking at the price performance of TDC's shares over the past 12 months, there is not much good news to report: the stock is down 25.79%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, TDC is still more expensive than most of the other companies in its industry. You can view the full analysis from the report here: TDC Ratings Report

Tesoro Corp and Tesoro Logistics Do the Drop Down

Yesterday, Tesoro Corp. (TSO) sold a bunch of assets to Tesoro Logistics (TLLP) for $650 million, the second “drop-down,” or sale of assets by a parent company to a partnership.

Reuters

The Wall Street Journal has the details:

Tesoro Logistics LP, a company spun off in 2011 by oil refiner Tesoro Corp., agreed to pay its former parent $650 million to acquire Los Angeles assets that include two marine terminals and a pipeline system.

The company, which expects to close on the deal in the current quarter, said it will fund the deal using mostly cash, as well as about $65 million in equity. In a separate statement Monday, Tesoro Logistics said it was offering at least 6.3 million common units, with proceeds to be used to fund the deal.

Hot Clean Energy Stocks To Watch For 2014

Cowen’s Sam Margolin assesses where Tesoro Corp. is now and its other drop-down opportunists:

Operationally, TSO continues to benefit from wide Bakken crude discounts, with the Clearbrook hub currently priced at a $14/bbl discount to WTI. During 3Q, TSO realized a gross refining margin of $21/bbl in its mid-con segment, vs refineries with Cushing price exposure in the $11/bbl-$15/bbl range. We expect similar outperformance in the current
period…

The completion of the Vancouver, WA rail terminal in 1Q14 should provide additional drop down opportunities early next year. Comped to the metrics of the Anacortes rail terminal drop, the 125,000 Vancouver terminal could realize a drop down price of over $450MM, with upside in an expansion scenario. We expect TSO to remain a regular provider of cash catalysts through its capital project backlog and aggressive utilization of the TLLP vehicle.

Shares of Tesoro have gained 1.9% to $56.42, besting Phillips 66′s (PSX) 1.5% rise to $68.22, Hollyfrontier’s (HFC) 0.1% drop to $46.19 and Valero Energy’s (VLO) 0.,1% dip to $42.86. Tesoro Logistics has dropped 6% to $49.82.

Fed meets with ‘taper’ plan likely on hold

NEW YORK — Back in September, the last time the Federal Reserve met on monetary policy, they voted not to start dialing back their market-friendly bond-buying program. Some said the vote was a "relatively close call."

Since then, the economy has been blindsided by a 16-day government shutdown that delayed the release of key economic data and dented consumer confidence.

There has also been soft incoming readings on employment and housing, two areas the Fed wants to see perk up dramatically before reducing its stimulus.

SURVEY: Shutdown shrinks economists' optimism

The bottom line: Tapering is off the table this month, too. And the Fed will likely let the world know that when its two-day meeting ends Wednesday.

"We doubt the vote (not to taper) will be nearly as close for most Fed members this time around," Michael Hanson, U.S. economist for Bank of America Merrill Lynch noted in a report.

So, will the Fed start cutting back on its $85 billion in monthly purchases of long-term U.S. Treasuries and mortgage-backed bonds at its December meeting? Or wait until 2014, as many economists say is more likely?

Top 5 Blue Chip Companies For 2014

"The timing of tapering is still open to debate," says Steven Ricchiuto, U.S. chief economist at Mizuho Securities USA.

In search of clues, investors will scrutinize the Fed's post-meeting statement. But Hanson says the "most interesting aspects" of the Fed's discussion "won't be revealed" until the minutes of the October meeting are released in mid-November.

Five finalists for Green Car of the Year named

Two clean diesels, two clean conventionals and one everything.

That's probably the best way to sum up the five finalists for the Green Car of of the Year, what has become one of the major prizes in the automotive world.

In the past, hybrids and electric cars seemd to have the edge. But in the last few years, the award has increasingly gone to a wider variety of cars.

This year, the two clean diesels are the Audi A6 TDI and BMW 328d. The two conventionals, meaning cleaner, more efficient versions of cars with standard internal-combustion engines, are the Mazda3 and the Toyota Corolla. And the everything is the new Honda Accord, which comes in a variety of "green" configuations.

Jurors include Jay Leno; Jean-Michel Cousteau, president of Ocean Futures Society; Frances Beinecke, president of the Natural Resources Defense Council; Michael Brune, executive director of the Sierra Club; and Matt Petersen, board member of Global Green USA.

Here's a little detail about the contenders:

The Finalists:

Audi A6 TDI. The 2014 A6 has a 240-horsepower, 3-liter, 6-cylinder TDI clean diesel engine and all-wheel drive, good for zero to 60 miles per hour in just 5.5 seconds. It has a start-stop system, which shuts off the engine at intersections. It gets an EPA estimated 38 highway miles per gallon, and has more than 700 miles of highway driving range.

BMW 328d. BMW's first four-cylinder diesel engine in the U.S. is rated at 45 mpg on the highway. It has a 180-horsepower, 2-liter engine with rear- or all-wheel drive.

Honda Accord. The midsize Accord now comes in a four-cylinder, V-6, hybrid, and plug-in hybrid version. Even the V-6 engine gets 36 mpg on the highway. At the high end, the plug-in gets an EPA rating of 115 MPGe, the government's way of rating electric vehicles.

Mazda3. With the brand's Skyactiv technology with its conventional 1.8-liter, four-cylinder engine, the new Mazda3 achieves 41 mpg on the highway.

Toyota Corolla. The popular compact's su! bcompact gets 42 mpg with its conventional 140-horsepower 1.8-liter, four-cylinder engine. It uses Toyota's Valvematic technology .

5 Best Performing Stocks To Invest In Right Now

Commodity stocks, lagging behind the Standard & Poor�� 500 Index by the most in 15 years, are poised to rally as analysts estimate profits will rise almost twice as fast as the rest of U.S. industry in 2014.

Mining companies and chemical producers in the S&P 500 will increase earnings by 18 percent in 2014, compared with a 11 percent gain for the equity gauge, according to the average of more than 9,000 estimates compiled by Bloomberg. Commodity stocks were the worst-performing S&P 500 group during the first six months of the year, before climbing the most in almost two years last quarter. Raw-materials companies are on track to lag behind the U.S. stock index for a third straight year, the longest stretch since 1998.

Bulls say stocks such as Freeport-McMoRan Copper & Gold Inc., DuPont Co. (DD) and LyondellBasell Industries NV (LYB) will continue to rebound as manufacturing expands in China, Europe and the U.S., spurring the fastest profit growth in three years for raw-material producers. Bears says the gains will be short-lived because the commodities super cycle is over and demand for metals and chemicals isn�� growing fast enough at a time when everything from copper to nickel and corn head into surpluses in the next year.

5 Best Performing Stocks To Invest In Right Now: Boart Longyear Ltd (BLY.AX)

Boart Longyear Limited provides drilling services, drilling equipment, and performance tooling for mining and drilling companies worldwide. The company operates through two divisions, Global Drilling Services and Global Products. The Drilling Services division provides a range of drilling services, including surface and underground coring, multi-purpose, reverse circulation, conventional air/mud rotary, flooded reverse, directional, sonic, and percussive production drilling to mining companies, energy companies, water utilities, environmental and geotechnical engineering firms, government agencies, and other mining services companies. This division provides drilling services for the exploration, development, and production of copper, gold, iron ore, nickel, and other metals and minerals. It conducts drilling services in approximately 40 countries in North America, South America, Asia, the Pacific Rim, Europe, and Africa. The Global Products division designs, manufactures, and sells drilling equipments and tooling. This division offers drilling equipment, drill rods, diamond bits, wireline core extraction systems, reverse circulation pipe and accessories, overburden tooling, pneumatic rock drills, rock drilling rods, and bits for various industries, such as mineral exploration, mining, energy, environmental sampling, and remediation, as well as infrastructure reinforcement and development. It provides mining products in approximately 100 countries. Boart Longyear Limited is headquartered in South Jordan, Utah.

5 Best Performing Stocks To Invest In Right Now: Macdonald Dettwile Com Npv (MDA.TO)

MacDonald, Dettwiler and Associates Ltd. provides information solutions that capture and process vast amounts of data, produce essential information, and help in decision making and operational performance of business and government organizations worldwide. The company offers integrated information solutions, which include land-based information systems and services comprising earth observation ground systems, defense information systems, airborne surveillance systems and services, and transportation management systems. It also provides commercial communications satellites; and space missions that include space-based information systems comprising earth observation, satellite communication, and space exploration missions, as well as offers various mission components and support services. In addition, the company provides space subsystems and robotics, as well as satellite composite structures to the United States market; and geospatial services that deliver information pro ducts and services to organizations that need to monitor and manage changes and activities on the earth in markets, such as national security, defense and intelligence, weather, climate and national resource monitoring, oil and gas, and transportation. Further, it offers aerospace and software engineering for the United States government and commercial sectors; and systems and subsystems for commercial space communications and remote sensing. The company provides its information solutions principally to surveillance and intelligence, and communications sectors, as well as conducts a range of customer funded advanced technology development for various other market sectors. MacDonald, Dettwiler and Associates Ltd. was founded in 1969 and is headquartered in Richmond, Canada.

Top 10 Casino Companies To Invest In Right Now: Fresh Del Monte Produce Inc.(FDP)

Fresh Del Monte Produce Inc., through its subsidiaries, produces, transports, sources, markets, and distributes fresh and fresh-cut fruit and vegetables worldwide. It also offers prepared fruit and vegetables, juices, beverages, snacks, and poultry and meat products. The company provides various fresh-cut fruit products, such as bananas, pineapples, melons, tomatoes, grapes, apples, pears, peaches, plums, nectarines, cherries, citrus, avocados, blueberries, kiwi, strawberries, plantains, mangos, and fruit cocktail; and fresh-cut vegetable products primarily consisting of potatoes, onions, bell peppers, and cucumbers, as well as prepared salads, such as coleslaw and potato salad. In addition, Fresh Del Monte Produce engages in ocean freight; and manufacture of plastics and box products comprising bins, trays, bags, and boxes. It offers fresh produce under the DEL MONTE, UTC, and Rosy brands; and prepared fruits and vegetables, juices, beverages, and snacks under the DEL MON TE, Fruit Express, Just Juice, and Fruitini brands. The company markets and distributes its products to retail stores, food clubs, wholesalers, distributors, and foodservice operators. Fresh Del Monte Produce Inc. was founded in 1886 and is based in George Town, Cayman Islands.

Advisors' Opinion:

• [By Seth Jayson]

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

5 Best Performing Stocks To Invest In Right Now: Annaly Capital Management Inc (NLY)

Annaly Capital Management, Inc. (Annaly), incorporated on November 25, 1996, owns, manage, and finance a portfolio of real estate related investments, including mortgage pass-through certificates, collateralized mortgage obligations (CMOs), Agency callable debentures, and other securities representing interests in or obligations backed by pools of mortgage loans. The Company's wholly owned subsidiaries offer diversified real estate, asset management and other financial services. The Company's subsidiary, RCap Securities, Inc. (RCap), operates as a broker-dealer. In August 2012, the Company liquidated FIDAC FSI LLC. In December 2012, the Company sold FIDAC Europe Limited.

The Company�� subsidiary Fixed Income Discount Advisory Company (FIDAC) is an investment advisor registered with the Securities & Exchange Commission (SEC), is a fixed-income investment management company specializing in managing fixed income investments in residential mortgage-backed securities, commercial mortgage-backed securities and collateralized debt obligations for various investment vehicles and separate accounts. FIDAC is engaged in managing and structuring debt financing associated with various asset classes and as a liquidation agent of collateralized debt obligations. As of December 31, 2012, FIDAC was the adviser or sub-adviser for real estate investment trust (REITs )and other investment vehicles. Merganser Capital Management, Inc. (Merganser) is an investment advisor, registered with the SEC, engaged in a range of fixed income strategies and focuses on managing each portfolio based on each client�� specific investment principles. Merganser serves a group of clients in a range of disciplines globally, including pension, public, operating, Taft-Hartley and endowment funds, as well contribution plans. RCap Securities, Inc. (RCap) operates as a broker-dealer and is a member in the Financial Industry Regulatory Authority (FINRA).

Through the Company�� subsidiary Shannon Funding LLC (Shannon),! it provides warehouse financing to residential mortgage originators in the United States. It also owns an additional subsidiary, which owns trading securities. Under the Company�� investment policy, at least 75% of its total assets consisted of mortgage-backed securities and short-term investments. The remainder of its assets, consisting not more than 25% of its total assets, may consist of other qualified REIT real estate assets. As of December 31, 2012, all of the mortgage-backed securities, which it has acquired, have been backed by single-family residential mortgage loans. The Company also invests in Agency debentures, which consist of debentures issued by the Federal Home Loan Bank (FHLB), Freddie Mac and Fannie Mae.

Advisors' Opinion:

• [By Dan Caplinger]

  But those fears continued to expand in the second quarter, and the bond market finally made significant moves that hurt bond prices and sent yields soaring. In response, many mortgage REITs expanded their purview to go beyond their traditional agency-backed securities. Annaly Capital (NYSE: NLY  ) , for instance, started adding securities backed by commercial mortgages, while Armour Residential (NYSE: ARR  ) set the stage for a shift by changing its charter to allow non-agency purchases. But because American Capital Agency has a sister REIT, American Capital Mortgage (NASDAQ: MTGE  ) , that has a broader scope, CIO Gary Kain plans to keep American Capital Agency's investing strategy true to its name by staying focused on agency-backed bonds.

• [By Jonas Elmerraji]

  There's no two ways about it: Annaly Capital Management (NLY) has gotten rocked this year. As I write, the $10 billion mortgage REIT is underperforming the S&P by 48% since the beginning of January. That's a pretty painful shortfall for investors -- but NLY could be near a turnaround right now.

  That's because NLY is currently forming a double bottom pattern, a bullish reversal setup that's formed by two lows that bottom out around the same price level. They're separated by a breakout level to the upside at $12.25 -- a move through that price is our buy signal on this stock. As I write, NLY is still very close to the number-two bottom that it made just a few sessions ago, so while it's bullish that shares hit the brakes at their old support level, it's early to start getting too aggressive with this trade.

  A move through $12.25 would be a pretty major trend reversal in NLY, but it's still a little while away. Still, the sheer underperformance at NLY means that it could try to play catch-up quickly. Put this trade in your watch list.

• [By Dan Caplinger]

  Another tax-law provision gives favorable tax status to real-estate investment trusts. REITs make investments in real estate-related assets, and they're required to pay out almost all their income to their shareholders annually. Simon Property Group (SPG) is one of the biggest REITs, focusing on shopping malls and paying a 3 percent yield. But other specialty areas of the REIT universe pay much higher dividends, with REITs like Annaly Capital (NLY) that invest in mortgage-backed securities topping the list with double-digit percentage yields.

• [By John Maxfield]

  I've been meaning to write about this for some time, but have put it off because, frankly, I feel slightly sullied every time I write about Annaly Capital Management (NYSE: NLY  ) . Of all the companies that I follow, I believe it to be the least honest and forthcoming with shareholders. And lest there be any doubt about this, its decision to "externalize" its management team, taken at last month's annual shareholder meeting, confirms this opinion.

5 Best Performing Stocks To Invest In Right Now: Altair Nanotechnologies Inc.(ALTI)

Altair Nanotechnologies Inc. develops, manufactures, and sells nano-structured lithium titanate spinel, battery cells, battery packs, and multi-megawatt battery systems, as well as provides related design, installation, and test services in the United States and internationally. The company also provides contract research services to develop intellectual property and/or new products and technology. It markets its energy storage solutions to power companies and electric grid operators; and batteries to electric and hybrid-electric bus manufacturers, and other industrial markets. The company was formerly known as Altair International Inc. and changed its name to Altair Nanotechnologies Inc. in July 2002. Altair Nanotechnologies Inc. was founded in 1973 and is headquartered in Reno, Nevada. Altair Nanotechnologies, Inc. operates as a subsidiary of Canon Investment Holdings Limited.

Advisors' Opinion:

• [By Bryan Murphy]

  Anybody who was lucky enough to be in an Altair Nanotechnologies Inc. (NASDAQ:ALTI) position anytime before October 11th, then congratulations - you're now up anywhere between 38% and 157%, depending on when you stepped in. Now get out. Instead, use that capital to step into an Amarin Corporation plc (NASDAQ:AMRN) position, which took a 20% hit on Friday. The rally from ALTI looks like it's ready to unravel, while the implosion from AMRN looks ripe for a reversal too.

Pep Boys Posts Slightly Lower Q2 Comps; Misses Estimates (PBY)

After the bell on Monday, Pep Boys (PBY) posted its Q2 earnings, with comparable sales and EPS coming in lower than last year’s Q2 figures.

The automotive aftermarket service and retail company posted a 1.3% decrease in comparable sales for the quarter. Adjusted operating profit coming in $19.4 million, an increase from last year’s Q2 figure of $15.5 million. The company’s sales for the quarter came in at $527.6 million.

Net earnings for the quarter came in at $5.4 million, or 10 cents per share, which were much lower than last year’s same quarter earnings of $33 million, or 61 cents per share.

Pep Boys missed the analysts’ EPS estimate of 19 cents and revenue estimate of $539.35 million.

PBY shares were up 19 cents, or 1.65%, by market close on Monday. YTD, the company’s stock is up almost 15%.

Raymond James, Janney Nab More Wirehouse Reps

St. Petersburg, Fla.-based Raymond James (RJF) says it continues to recruit successful advisors from Morgan Stanley (MS), Merrill Lynch (ML) and a number of other firms, building on its momentum in technology and its integration of Morgan Keegan.

“We see continued very-strong interest across the full spectrum of affiliated options, including our employee, RIA and independent options, said Tash Elwyn (left), president of Raymond James & Associates-Private Client Group, in an interview with AdvisorOne.

At the same time, Philadelphia-based Janney Montgomery Scott has been adding to its ranks by recruiting a number of wirehouse reps. The firm said Tuesday that ex-Morgan Stanley advisors Alfred DeRenzis and Scott Ford  joined its new branch in Westminster, Md.

DeRenzis and Ford have a total of nearly $160 million in client assets. Prior to Morgan Stanley, the team worked with Citigroup and earlier with Legg Mason.

The ability of these firms to attract these veteran reps, experts say, may stem in part from their non-Wall Street character, which can be especially inviting to reps who were previously with broker-dealers in the Midwest or Southeast. A number of wirehouse reps, meanwhile, have swelled Raymond James' ranks in a few recent big-firm exits.

On Monday, for instance, a team of advisors led by Scott A. Schuster formed Dashboard Wealth Advisors, an independent firm affiliated with Raymond James Financial Services in Oak Brook, Ill. The team came to Raymond James from Morgan Stanley, where they managed more than $240 million in client assets and had annual fees and commissions of $1.9 million.

“We wanted a firm where we could continue to expand and develop our holistic process of financial planning … with a service-first focus that offers cutting-edge technology, so when we discovered that Raymond James provided all of those things … it was a slam-dunk,” said Scott Schuster, who moved to Morgan Stanley from A.G. Edwards in 2007, in a statement.

And on Wednesday, Raymond James said that Claire Friedrichs joined its traditional employee channel in Mandeville, La., from Merrill Lynch, where she managed some $80 million in client assets and produced $850,000 in annual fees and commissions through April, when she switched firms.

Motivation for Movement

As for what’s driving movement out of the wirehouses, “There’s no big trouble or scandal right now, so we’re really in a stalemate here,” ” recruiter Rick Peterson explained, in an interview.

“The [recruiting] deals are the same as they’ve been in the past three or four years,” explained Peterson, who sees today's attrition and recruiting levels at the wirehouses as a "zero-sum game."

Elwyn (right), however, sees things differently. “Despite the extremes of market highs and lows, what’s consistent is that many competitors – at the wirehouse and regional firms – continue to create pain points for their advisors,” he said.

 “Those pain points can vary from macro, firm-oriented issues to micro, branch-level issues like branch manager turnover, the ratio of financial advisors to service associates and the like,” Elwyn noted.

“There’s a pairing of the pain points that exist at competitor firms and Raymond James’ culture, values and other factors that attract advisors to us,” he said, “such as our reputation, industry-leading technology and 101 quarters of profitability.”

Elwyn says Raymond James expects its recruiting of wirehouse and other reps to remain strong, regardless of market conditions.

 

Bear of the Day: Kraton Performance Polymers (KRA) - ...

Kraton Performance Polymers (KRA) recently reported its 3rd straight earnings miss, prompting analysts to revise their estimates significantly lower for both 2013 and 2014. This sent the stock to a Zacks Rank #5 (Strong Sell).Despite the negative earnings momentum, shares of Kraton still trade at a premium to their peers on a forward P/E basis. Investors may want to wait for earnings momentum to turn around before establishing a long position.Kraton Performance Polymers produces engineered polymers that are used in a variety of products, such as adhesives, coatings, consumer and personal care products, sealants and lubricants, and medical, packaging, automotive, paving, roofing and footwear products.Second Quarter ResultsKraton Performance Polymers reported disappointing second quarter results on July 31. Adjusted earnings per share fell -67% year-over-year to 15 cents, missing the Zacks Consensus Estimate by 9 cents. It was the company's 3rd consecutive earnings miss.Sales were down -11% to $334.5 million, well below the consensus of $363.0 million. The decline was driven mostly by lower butadiene prices as overall volumes were essentially unchanged. The 'Paving & Roofing' end market saw the biggest revenue drop at -19% thanks in part to wet weather. Meanwhile, the gross profit margin fell 166 basis points to 17.9% of sales.Estimates FallFollowing the Q2 earnings miss, analysts revised their estimates significantly lower for both 2013 and 2014. This sent the stock to a Zacks Rank #5 (Strong Sell).The Zacks Consensus Estimate for 2013 is now $0.98, down from $1.47 just 30 days ago. The 2014 consensus is currently $1.87, down from $2.13 over the same period.You can see this dramatic drop in the company's 'Price & Consensus' chart:ValuationShares of Kraton currently trade around 12x 12-month forward earnings, which might sound cheap on an absolute basis, but is a premium to both the industry mu! ltiple and its historical median. Its price to cash flow ratio of 18 is also above the industry and its historical median.The Bottom LineWith falling earnings estimates and premium valuation, investors should consider avoiding this Zacks Rank #5 (Strong Sell) stock until its earnings momentum turns around.Todd Bunton is the Growth & Income Stock Strategist for Zacks Investment Research and Editor of the Income Plus Investor service.

Apple still has a China problem

NEW YORK (CNNMoney) Apple's landmark deal with China Mobile gives it access to more than 700 million new cell phone customers -- a staggering number. But it still has a long way to go before it's a power player in the world's biggest market for smartphones.

That's because Apple (AAPL, Fortune 500) continues to fight the smartphone battle in China with one hand tied behind its back. The problem is its expensive products.

The iPhone 5C, which many analysts had expected would be a cheaper iPhone for China, turned out to be an expensive version with a plastic shell. In China, where wireless carriers don't subsidize phones, the iPhone 5C costs 4,488 yuan ($733). That prices out a large part of China's population.

Apple also lacks the app store advantage in China that it holds in most other countries around the world. The government censors many of the offerings on Apple's iTunes App Store, and Chinese customers haven't proven willing to spend money on top-tier apps when they can get free knockoffs.

All that said, the deal with China Mobile (CHL) is expected be a lucrative one for Apple.

  Will the iPhone succeed in China?

Until now, Apple had sold the iPhone there through China Mobile's much-smaller competitors, China Unicom (CHU)and China Telecom (CHA), which have about 425 million subscribers between them.

Apple is in a distant fifth place, trailing Samsung, Lenovo, Yulong and Huawei, according to Canalys. It has just a 6% share of the Chinese smartphone market.

Unlike many rival phones, the iPhone 5S and 5C are 4G devices, giving China Mo! bile customers their first chance to use the company's brand new 4G network.

And the iPhone is already a somewhat proven commodity on China's biggest cell network: As many as 40 million China Mobile customers are using an unlocked iPhone on the network, according to Brian White, an Apple analyst at Cantor Fitzgerald.

Top Performing Stocks To Own For 2014

Wall Street analysts expect Apple to sell an additional 20 million to 30 million iPhones next year as a result of the deal. That's still a sliver of the Chinese smartphone market of 200 million phones -- but it's no small number either. Apple sold 150.2 million iPhones last year, and analysts expect it to sell between 165 million and 180 million next year.

So the deal could give Apple as much as a 20% boost in iPhone sales.

Another way to look at it: Many analysts expect China Mobile to be the only source of iPhone sales growth next year.

Apple CEO Tim Cook has discussed gaining a stronger foothold in China as a major priority for the company. The China Mobile deal will help Apple accomplish that.

But unless Apple changes its strategy and offers a low-cost iPhone for the Chinese market -- something the company has proven unwilling to do -- it's unlikely that Apple would become a top Chinese smartphone player.

The 3 Best Coal Stocks to Buy Now

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It hasn’t been the best couple of years for investors in coal stocks.

Coal stocks have faced the dual threat of falling demand coupled with rising regulation. First, our abundance of natural gas — which has been great for the oil stocks — has pushed prices down for the fuel towards historic lows. That's causing utilities to abandon coal in favor of cheap natural gas for electricity generation.

Exacerbating the plight of coal stocks is rising environmental legislation. New rules created by the EPA have pushed utilities towards natural gas. New plants are essentially being forced to run on the abundant and cleaner burning fuel. That's prompted several coal stocks to close mines and others to like Patriot Coal (PCXCQ) to close up shop and file for bankruptcy protection.

However, all this hatred towards coal stocks could provide tantalizing values for investors who want bargains. Several of the largest and best-run coal stocks are currently trading for peanuts. Meanwhile, coal is still widely used worldwide in steel manufacturing and in many emerging markets to generate electricity.

Simply put, the coal stocks trio of Peabody Energy (BTU), Alpha Natural Resources (ANR) and Cloud Peak Energy (CLD) could be some of the biggest bargains out all energy stocks.

Best Coal Stocks to Buy Now – Peabody Energy (BTU)

When it comes to coal stocks, Peabody Energy (BTU) is definitely king of them all.

BTU stock is appealing because Peabody is one of the largest producers of the mineral. The BTU empire spans 28 different mines across several nations — including the U.S., Australia, Indonesia and China. That global reach has allowed Peabody Energy to profit even when things turned sour for coal stocks here at home. BTU has a much easier time tapping into markets in electricity-hungry Asia than many other domestic coal stocks.

Not to mention that prices for coal are better overseas as well.

For the first nine months of the year, Peabody Energy was able to sell Australian-produced coal at around $112 per ton. Meanwhile, it only cost BTU around $80 per ton to produce. By contrast U.S. mined coal only netted BTU around $18 per ton at a cost of $13.

Meanwhile, Peabody Energy continues to cut costs via prudent CAPEX spending and lowering its debt. BTU stock currently features an industry low debt-to-equity ratio of 130%.

All in all, its global reach and low costs of production have made BTU stock one of the only profitable coal stocks around. Based on 2016 earnings estimates, BTU stock currently can be had for dirt cheap P/E of just 7.

Best Coal Stocks to Buy Now – Cloud Peak Energy (CLD)

For coal stocks, Wyoming's Powder River Basin features some of the best coal reserves on the planet. Aside from the sheer amount of coal, it has some of the lowest sulfur-producing reserves. That makes it ideal for utilities trying to skirt new EPA rules about emissions.

It also happens to be the primary stomping ground for Cloud Peak Energy's (CLD) — one of the top coal stocks out there.

With royalty agreements with the Powder River Basin's Crow Tribe, CLD has unprecedented access to the region’s vast reserves at cheaper costs than its competitor's holdings. CLD stock could get a boost from future exports of PBR coal. The pending Gateway Pacific Terminal — which will be used to send PBR coal directly to Asia — happens to sit in CLD's back yard.

With that sea-port still in the planning/construction stages, CLD has been cutting costs, conserving cash and idling excess mine supply. That puts coal stocks like CLD in a prime position to benefit when coal prices rebound.

CLD stock can currently be had for P/E of 16.

Best Coal Stocks to Buy Now Alpha Natural Resources (ANR)

With the global economy finally beginning to move forward, Alpha Natural Resources (ANR) is one of a few coals stocks that could be an interesting turnaround play. See, unlike CLD and BTU, ANR mainly produces metallurgical coal — the kind used in steel making.

Currently, metallurgical coal prices are flat due to oversupply. That's hurt the company’s bottom line and ANR stock over the last few quarters. However, with industrial output ramping up in key steel producing nations — namely, Japan, China and South Korea — the medium- to longer-term picture seems to be a bit rosier for ANR stock.

At the same time, ANR has a few aces up its sleeve vs. other coal stocks. First, Alpha Natural Resources plans on selling its ownership stake in a shale gas joint venture for $300 million in cash and shares to Rice Energy. Aside from boosting its near-term liquidity, Rice Energy plans to IPO in early 2014. That will provide a nice exit event for ANR stock.

Secondly, ANR recently issued a series of convertible notes at a cheap 4.875% interest rate. Those notes will be used to retire current liabilities. Overall, the bond issue and shale gas sale boosted ANR stocks liquidity to nearly $2 billion. That should be more than enough to help ANR stock ride out the downturn in metallurgical coal prices until they rebound. That liquidity position is enviable for many other coal stocks.

In view of the better long-term picture, investors may want to give ANR stock a go. And if not, the other coal stocks on this list are solid if you want to bet on the beaten-down sector.

As of this writing, Aaron Levitt did not hold a position in any of the aforementioned securities.

Fed cuts QE pace to $75B on labor market outlook

It starts: Fed chairman Ben S. Bernanke has started the taper. Bloomberg News

The Federal Reserve is cutting its monthly bond purchases to $75 billion from $85 billion, taking the first step toward unwinding the unprecedented stimulus that Chairman Ben S. Bernanke put in place to help the economy recover from the worst recession since the 1930s.

“In light of the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions, the committee decided to modestly reduce the pace of its asset purchases,” the Federal Open Market Committee said Wednesday at the conclusion of a two-day meeting in Washington. The Fed's purchases will be divided between $40 billion in Treasuries and $35 billion in mortgage bonds starting in January.

Mr. Bernanke, in the final weeks of his eight-year tenure, is curtailing the purchases that swelled the Fed’s balance sheet almost to $4 trillion as he sought to put millions of jobless Americans back to work. The policy, supported by his designated successor, Vice Chairman Janet Yellen, stirred concern it risks inflating asset-price bubbles even as its economic benefits ebbed.

“If incoming information broadly supports the committee’s expectation of ongoing improvement in labor-market conditions and inflation moving back toward its longer-run objective, the committee will likely reduce the pace of asset purchases in further measured steps.” The committee repeated that purchases are “not on a preset course.”

Treasuries fell after the decision, pushing the yield on the 10-year note to 2.9% from 2.84% late Tuesday. Stocks extended gains.

TARGET RATE

The central bank left unchanged its statement that it will probably hold its target interest rate near zero “at least as long as” unemployment exceeds 6.5%, so long as the outlook for inflation is no higher than 2.5%.

The panel added that it “likely will be appropriate to maintain the current target range for the federal funds rate well past the time that the unemployment rate declines below 6.5%, especially if projected inflation continues to run below” the Fed’s 2% goal.

Price gains have lagged below the committee’s long-run target. The central bank’s preferred gauge of inflation, excluding food and energy, climbed 1.1% in the year through October. It has not breached 2% since March 2012.

Boston Fed President Eric Rosengren dissented, saying that changes on the bond-purchase program were “premature until incoming data more clearly indicate that economic growth is likely to be sustained above its potential rate.”

Policy makers met amid signs the economy and labor market were gaining strength, even as inflation remained subdued.

JOB MARKET

The jobless rate fell to 7% in November, a five-year low, as employers added a greater-than-forecast 203,000 workers to payrolls. Unemployment was down from 10% in October 2009, during the recession, and up from 4.4% in May 2007.

Retail sales climbed by the most in five months in November, a sign that consumer spending was strengthening as the holiday season began. Industrial production last mo! nth increased by the most in a year, a Fed report showed this week.

Companies including Ford Motor Co. are benefiting from rising demand for new cars. Ford said this month it plans to add 5,000 jobs in the U.S. and will introduce 16 new vehicles in North America next year. The payroll expansion will continue following the hiring of almost 6,500 people in 2013.

Stocks have surged on stronger corporate earnings and continued Fed stimulus. The Standard & Poor’s 500 Index closed at a record 1,808.37 on Dec. 9 and was up 25% for the year as of Tuesday.

The Fed’s low interest rates have prompted consumers to buy homes or refinance existing mortgages, sparking a recovery in the housing market that was at the center of the financial crisis.

Housing prices climbed 13.3% in the 12 months through September, according to an S&P/Case-Shiller index of prices in 20 cities. The pace of home construction reached a more than five-year high in November as builders added to inventory to keep pace with demand, a report Wednesday from the Commerce Department showed.

Rising stocks and home values are boosting household wealth, giving consumers the wherewithal to keep spending. Many have invested in improvements to their homes, lifting profits at companies such as Home Depot Inc., the largest U.S. home-improvement retailer.

FALSE STARTS

“This is one of the stronger-looking points of the recovery,” said Alan MacEachin, corporate economist at Navy Federal Credit Union. “We’ve had a couple of false starts, but now you’ve got the cumulative effects of an improving job market, coupled with the wealth effect from record stock levels.”

Yet with inflation so low, the economy could be at risk of deflation were growth to slip, he said. “One of the Fed’s biggest fears right now is if the economy were to slow significantly, that’s going to put more downward pressure on inflation.”

Growth so far has lagged behind previous recoveries. In the 17 qua! rters sin! ce the recession ended, the economy has expanded at an average annualized rate of 2.3% each quarter. That compares with an average of 3.2% over the same period following the 2001 and 1991 recessions, and 5% following the 1982 recession.

Gross domestic product will expand 2.6% next year after gaining 1.7% in 2013, according to the median forecast of economists surveyed by Bloomberg from Dec. 6 to Dec. 11.

Economists were divided on whether the FOMC would begin tapering bond purchases Wednesday. Thirty-four percent of economists in a Dec. 6 Bloomberg survey said the Fed would act at today’s meeting. Twenty-six percent predicted a January taper and 40% said March.

The Fed’s debate over when to taper purchases has dominated central banking discussions for much of the year, setting off waves of volatility in financial markets. In May, Mr. Bernanke told Congress that the Fed may slow its purchases during the “next few meetings.”

The yield on the 10-year Treasury climbed to as high as 3% in September from as low as 1.61% in May, as investors anticipated a reduction in Fed stimulus. The national average 30-year fixed-rate mortgage climbed to 4.58% in late August from 3.35% in May, according to Freddie Mac.

“As soon as they started talking about tapering, they raised interest rates,” said Julia Coronado, chief economist for North America at BNP Paribas in New York and a former Fed economist.

SEPTEMBER MEETING

Before the September FOMC meeting, the majority of economists in a Bloomberg survey expected the Fed to begin reducing purchases. The committee surprised mark

Top Warren Buffett Stocks To Own Right Now

One of the benefits of attending the Berkshire Hathaway (NYSE: BRK-B  ) shareholders' meeting is learning from the great value investors and Buffettologists who also make the yearly trek to Omaha. In this multipart series, Fool analyst Rex Moore speaks with Lawrence Cunningham, author of The Essays of Warren Buffett: Lessons for Corporate America. The book offers a unique approach by arranging all of Buffett's shareholder letters thematically, rather than chronologically.

Today, Professor Cunningham explains which themes have remained constant in these letters throughout the years.

What about the stock?
Thanks to the savvy of investing legend Warren Buffett, Berkshire Hathaway's book value per share has grown a mind-blowing 586,817% over the past 48 years. But with Buffett aging and Berkshire rapidly evolving, is this insurance conglomerate still a buy today? In The Motley Fool's premium report on the company, Berkshire expert Joe Magyer provides investors with key reasons to buy as well as important risks to watch out for. Click here now for instant access to Joe's take on Berkshire!

Top Warren Buffett Stocks To Own Right Now: Opko Health Inc(OPK)

OPKO Health, Inc., a pharmaceutical and diagnostics company, engages in the discovery, development, and commercialization of novel and proprietary technologies primarily in the United States, Chile, and Mexico. It provides a range of solutions, including molecular diagnostics tests, proprietary pharmaceuticals, and vaccines to diagnose, treat, and prevent neurological disorders, infectious diseases, oncology, and ophthalmologic diseases. The company offers molecular diagnostic platform technology for the rapid identification of molecules or immunobiomarkers; Alzheimer?s test for Alzheimer?s diagnostic; and protein-based influenza vaccines to provide multi-season and multi-strain protection against various influenza virus strains, such as seasonal influenza strains, as well as global influenza pandemic strains which include swine flu, and avian flu. It also offers Oligonucleotide Therapeutics for the treatment of various illnesses, including cancer, heart disease, metabolic disorders, and genetic anomalies; and oligosaccharide for asthma and chronic obstructive pulmonary diseases. In addition, the company provides Rolapitant, a potent and antagonist; neurokinin-1, which has completed Phase II clinical trials for prevention of chemotherapy induced nausea and vomiting, and post-operative induced nausea and vomiting; and SCH 900978 that has completed Phase II clinical trials for chronic cough. Further, it offers bevasiranib, a drug candidate for the treatment of Wet AMD; and develops Aquashunt, a shunt to be used in the treatment of glaucoma. Additionally, the company involves in the development, commercialization, and sale of ophthalmic diagnostic and imaging systems, and instrumentation products. OPKO Health, Inc. was founded in 2006 and is headquartered in Miami, Florida.

Advisors' Opinion:

• [By John Udovich]
  SafeStitch Medical Inc. A developer and marketer of�best in class disposable medical devices to advance minimally invasive surgery for hernia repair, treatment of obesity and other gastroesophageal disorders, small cap SafeStitch Medical has developed and obtained FDA approval to market the AMID Hernia Fixation Device (HFD) for both inguinal and ventral hernia repairs. SafeStitch Medical has a couple of people behind it who are also involved in OPKO Health (NYSE: OPK)���a NYSE company with a $2.5 billion market cap. Moreover, these and other insiders were heavy buyers of the stock during the last private placement. On Wednesday, sank 18.57% to $0.855 (SFES has a 52 week trading range of $0.21 to $1.49 a share) for a market cap of $52.75 million but the stock is up 288.6% since the start of the year after surging this summer, up 42.5% over the past year and down 64.4% over the past five years.�

• [By GuruFocus]

  Opko Health Inc. (OPK): CEO & Chairman, Director, 10% Owner Phillip Md Et Al Frost Bought 42,700 Shares

  CEO & Chairman, Director, 10% Owner of Opko Health, Inc. (OPK) Phillip Md Et Al Frost bought 42,700 shares during the past week at an average price of $10.74. Opko Health, Inc. has a market cap of $4.33 billion; its shares were traded at around $10.74 with and P/S ratio of 39.84.

Top Warren Buffett Stocks To Own Right Now: Tres-Or Resources Ltd. (TRS.V)

Tres-Or Resources Ltd. engages in the acquisition, exploration, and development of gold, diamond, and precious and base metal properties in Quebec and Ontario, Canada. It explores for gold, diamond, platinum/palladium, and precious and base metals. The company focuses on gold exploration in the Abitibi Greenstone Belt of Ontario and Quebec with holdings of approximately 4000 hectares of claims. Tres-Or Resources Ltd. is headquartered in Vancouver, Canada.

5 Best Performing Stocks To Own For 2014: Pall Corporation(PLL)

Pall Corporation, together with its subsidiaries, manufactures and markets filtration, purification, and separation products and integrated systems solutions worldwide. The company?s Life Sciences segment provides technologies that facilitate the process of drug discovery, development, regulatory validation, and production used in the research laboratories, pharmaceutical and biotechnology industries, food and beverage industry, blood centers, and hospitals at the point of patient care. It also offers medical products that enhance the safety of the use of blood products in patient care and help control the spread of infections in hospitals; and cell therapy products that enable technologies for the regenerative medicine market. In addition, this segment sells various filtration and purification technologies, appurtenant hardware, and engineered systems for the development and commercialization of chemically synthesized and biologically derived drugs, plasma, and vaccines, as well as offers filtration solutions; validation services to drug manufacturers; and laboratory products for use in drug research and discovery, quality control testing, and environmental monitoring applications. Further, it serves the filtration needs of the food and beverage market. The company?s Industrial segment provides enabling and process enhancing technologies for the industrial market. It offers filtration and fluid monitoring equipment to the aerospace industry; filtration and purification technologies for the semiconductor, data storage, fiber optic, advanced display, and materials markets; and a suite of contamination control solutions for chemical, gas, water, chemical mechanical polishing, and photolithography processes. This segment also provides various technologies to producers of energy, oil, gas, renewable and alternative fuels, electricity, chemicals, and municipal water. The company was founded in 1946 and is headquartered in Port Washington, New Yo rk.

Advisors' Opinion:

• [By Mike Deane]

  On Tuesday, Pall Corp (PLL) announced a 10% raise to its quarterly dividend.

  The East Hills, NY-based filtration, purification and separation products supplier will now pay a monthly dividend of 27.5 cents, which is up from its previous quarterly payout of 25 cents. On an annualized basis, PLL will now pay shareholders $1.1 per share.

  The dividend is payable on November 8, 2013 to all shareholders on record as of October 18, 2013. The ex-dividend date is October 16, 2013.

  PLL shares were down just 5 cents, or .06%, at market close on Tuesday. The company’s stock is up more than 24% YTD.

• [By Benjamin Shepherd]

  Pall Corp (NYSE: PLL) is another company that provides water filtration, separation and purification technology, but it tends to focus more on industry users. Just as we all need clean, fresh water to drink, a number of industrial users such as pharmaceutical makers and chip manufacturers require pristine water for their manufacturing processes.

• [By John Divine]

  Filtration systems producer Pall (NYSE: PLL  ) leads off today's list, having slumped 5.1%. The company reported quarterly results after the markets closed yesterday, and investors were underwhelmed. Sales didn't live up to expectations, although earnings actually beat estimates. The company's outlook really stung shares: Pall said that European expansion was going well, while operations in China were sluggish. Apart from that being the inverse version of what Wall Street wanted to hear, the company also lowered guidance for the fiscal year.

Top Warren Buffett Stocks To Own Right Now: Callidus Software Inc.(CALD)

Callidus Software Inc., together with its subsidiaries, provides sales performance management (SPM) software applications and services. Its products include TrueComp Manager application that automates the modeling, design, administration, reporting, and analysis of pay-for-performance programs; Callidus Reporting for delivering real-time production reports; Callidus Analytics, which enable businesses to deploy performance dashboards across the finance, sales executive, and sales force teams; Callidus Objective Management to design and deploy strategic objective-based bonus plans and long term incentive programs; and Callidus Quota Management to allocate quotas effectively. The company?s products also comprise Callidus Communicator, which accelerates and streamlines communications with a business sales force and sales channels; Callidus Channel Management for telecommunication companies to view and update dealer information; Callidus Producer Management for insurance carri ers; Callidus Onboarding to build and optimize discrete, re-usable workflows; Callidus Coaching to optimize performance of their sales force and call centers; Callidus Plan Communicator that accelerates the process of rolling out and communicating incentive plans across the sales force; Callidus Commissions Manager for sales professionals; and ACom3, an incentive compensation automation suite. In addition, it provides software consulting services, including a range of SPM solution implementations, system upgrades, compensation plan enhancements, migration assistance, reporting and integration consulting, and solution architecture services; and SaaS-based sales assessments, coaching, and talent development solutions. The company serves the telecommunications, insurance, banking, technology, and life sciences/pharmaceuticals markets in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. Callidus Software was founded in 1996 and is headquartered in Pleasanton, California.

Advisors' Opinion:

• [By karnacua2]

  Posted-In: Markets Trading Ideas

    Around the Web, We're Loving... Cyber Trading University Presents: The Psychology of a Winning Trader Rumsfeld: Denial of Benefits to Fallen Soldiers' Families 'Inexcusable' Facebook, Baidu Lead Big Caps Beating Shutdown What Should You Know About AMZN? Most Popular These Four Story Stocks Got Beat Up Tuesday (TSLA, LNKD, NFLX, FB) Hewlett Packard's Chromebook 11 Features Innovation Not Found In Apple's MacBook (GOOG, HPQ) UPDATE: J. C. Penney Company, Inc. Provides Update on Progress of Turnaround Yahoo Chose Apple's iPhone, MacBook Pro To Promote Mail Upgrade Apple's iPad 5 Event To Crash Surface Release Party On October 22 Apple Should Have 'Immediately' Apologized For iPhone Blunder Related Articles (CALD) Callidus Software (CALD) Expects Q3 FY2013 Financial Results Will Exceed Previous Guidance, Shares Surged Stocks Hitting 52-Week Highs Morning Market Movers

Top Warren Buffett Stocks To Own Right Now: Bravo Brio Restaurant Group Inc.(BBRG)

Bravo Brio Restaurant Group, Inc. owns and operates Italian restaurant brands in the United States. Its brands include BRAVO! Cucina Italiana, and BRIO Tuscan Grille. The company also operates an American-French bistro restaurant under the brand Bon Vie. As of March 02, 2012, it owned and operated 95 restaurants in 30 states. The company was formerly known as Bravo Development, Inc. and changed its name to Bravo Brio Restaurant Group, Inc. in June 2010. Bravo Brio Restaurant Group, Inc. was incorporated in 1987 and is based in Columbus, Ohio.

Advisors' Opinion:

• [By CRWE]

  Bravo Brio Restaurant Group, Inc. (Nasdaq:BBRG) owner and operator of the BRAVO! Cucina Italiana (BRAVO!) and BRIO Tuscan Grille (BRIO) restaurant concepts, will host a conference call to discuss third quarter 2012 financial results on Tuesday, October 23, 2012 at 5:00 PM ET.

Top Warren Buffett Stocks To Own Right Now: Redwood Trust Inc.(RWT)

Redwood Trust, Inc., a real estate investment trust, together with its subsidiaries, engages in investing, financing, and managing real estate assets. The company?s investments include residential and commercial real estate loans; and securities backed by residential and commercial loans, including senior and subordinate securities. The senior securities are those interests in a securitization that have the first right to cash flows and are last to absorb losses; and subordinate securities are those interests in a securitization that have the last right to cash flows and are first in line to absorb losses. As of March 31, 2011, it had 77 real estate owned properties primarily in Arizona, California, Colorado, Florida, and Georgia. It would elect to be taxed as a real estate investment trust (REIT) for federal income tax purposes. As a REIT, the company would not be subject to federal income tax, if it distributes at least 90% of net taxable income to its stockholders. Red wood Trust, Inc. was founded in 1994 and is based in Mill Valley, California.

Advisors' Opinion:

• [By Amanda Alix]

  Luxury market is doing just fine
  Jumbo loans are back, and these mortgages -- which start at $625,000 in some affluent areas -- are being given out like candy�to those with the wealth to back them up. Once considered risky because they are not backed by Fannie Mae or Freddie Mac, lenders are falling over themselves to make these loans, driven by a securitization market dominated by entities like Redwood Trust (NYSE: RWT  ) and JPMorgan Chase (NYSE: JPM  ) . Earlier this month, Redwood offered its seventh securitization backed by jumbos, and JPMorgan just recently announced�its second offering of the year, as well.

• [By Amanda Alix]

  On the mortgage front, Two Harbors notes that it has acquired a passel of prime jumbo home loans, which it likely plans to securitize. The company's CEO, Tom Siering, also addresses this issue on the earnings call, where he states that the trust was involved in a $400 million securitization of prime jumbo loans. This puts Two Harbors in the company of mREIT Redwood Trust (NYSE: RWT  ) , which has nearly single-handedly brought back the jumbo-loan securitization market over the past two years. If Redwood's success is any indication -- it recently reported first-quarter net income�of $61 million, compared to the year-ago figure of $30 million -- Two Harbors is on the right track.

Top Warren Buffett Stocks To Own Right Now: Batm Advanced Communications(BVC.L)

BATM Advanced Communications Ltd. engages in the research, development, production, and marketing of data communication products in the field of local and wide area networks, and premises management systems worldwide. The company offers Ethernet/MPLS aggregation, Ethernet demarcation, multi-service access, fiber-to-the-home and fiber-to-the-business, optical transportation, and wavelength multiplexing products. It also provides TDM products, including multiplexers, SONET products, multi-service IADs, and E/O converters; NMS/EMS products; rugged Ethernet systems; and ATCA hub blades. The company?s data communication products are used by telecommunication carriers and service providers, utilities, municipalities, and government agencies. In addition, the company involves in the research, development, production, marketing, and distribution of medical products, primarily laboratory diagnostic equipment. Further, it offers software services and sterilization products. BATM Ad vanced Communications Ltd. was founded in 1992 and is headquartered in Kfar Netter, Israel.

Top Warren Buffett Stocks To Own Right Now: Pitney Bowes Inc(PBI)

Pitney Bowes Inc. provides mail processing equipment and integrated mail solutions worldwide. It offers a suite of equipment, supplies, software, services, and solutions for managing and integrating physical and digital communication channels. The company?s Small & Medium Business Solutions group engages in the sale, rental, and financing of mail finishing, mail creation, and shipping equipment and software; provision of supply, support, and other professional services; and provision of payment solutions. Its Enterprise Business Solutions group sells, supports, and offers other professional services for high-speed production mail systems, and sorting and production print equipment; and sells and provides support services for non-equipment-based mailing, customer relationship and communication, and location intelligence software. This group also offers facilities management services; secure mail services; reprographic document management services; and litigation support and eDiscovery services, as well as provides presort mail services and cross-border mail services; and direct marketing services. Pitney Bowes Inc. markets its products and services through its sales force, direct mailings, outbound telemarketing, and independent distributors and dealers to various business, governmental, institutional, and other organizations. The company, formerly known as Pitney Bowes Postage Meter Company, was founded in 1920 and headquartered in Stamford, Connecticut.

Advisors' Opinion:

• [By Chuck Saletta]

  Watch that dividend quality
  Similarly, by putting quality controls around a company's dividend and ability to pay it, the iPIG portfolio was able to miss one of the largest recent dividend blow-ups, Pitney Bowes (NYSE: PBI  ) . The company slashed its dividend in half last week, but before that cut, it had a 30-year history of regularly raising its dividend.

• [By Sean Williams]

  Finally, software and hardware solutions developer for the logistics industry Pitney Bowes (NYSE: PBI  ) advanced 3.9% despite no company-specific news. The story here could be more related to short-sellers than anything else. Pitney Bowes is consistently among the S&P 500's most short-sold companies, meaning any slight rally can be exacerbated by short-sellers covering their positions. While today's move certainly gave optimists the upper hand, it does nothing to change the long-term investing thesis that Pitney Bowes' revenue is shrinking, and it's already had to slice its dividend in half to conserve its free cash flow. In my book it's still a stock to steer clear of.

• [By WALLSTCHEATSHEET.COM]

  Apparently, the majority of analysts like the stock. That�� surprising. The best chance investors have is that Pitney Bowes continues to cut costs so the stock can stay afloat while large dividends are paid out. However, over the long haul, there is no business without growth.

The Highest Paid College President Made $3.3 Million

Every year, the Chronicle of Higher Education puts out its list of the compensation of 550 presidents at America’s private colleges. Forty-two of them made more than $1 million in 2011, the latest year covered. Most extraordinary, two made more than $3 million. Robert Zimmerman of the University of Chicago topped the list at $3,358,723, which means he is paid as much as many CEOs of America’s large companies.

To be fair, it should be noted that most of the presidents who made more than $1 million have held their jobs for a number of years — and some more than a decade. A great majority are presidents of colleges that are routinely rated as America’s best. This includes Columbia, Yale, Brown, Duke and Stamford. Alternatively, the presidents of several obscure colleges make the list, including the University of La Verne, where chief Stephen Morgan has been for 26 years. James Doti of Chapman University is on the list as well, after 20 years of service. So is John Lahey of Quinnipiac. Longevity plays a role in some pay packages, it seems.

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At the other end of the compensation list is evidence that running an obscure college is often not a well-paid job, and many of these people who are lowest paid are clergy. The Rev. Brian Shanley of Providence College made $59,195. The Rev. Joseph Levesque of Niagara made only $47,298. The Rev. Kevin Quinn, head of the University of Scranton, was paid only $47,305. In his case, it may have been because he had his job less than a year.

The Chronicle of Higher Education reports that college boards often have a justification, at least in their minds, for extraordinary pay packages for presidents:

When defending compensation of $1-million and more for college presidents, trustees and university officials often repeat a simple refrain: Attracting the best talent costs money.

It is the same case made by the boards of directors of large American companies. If the argument that the pool of very talented candidates for colleges and companies is true, boards have a reasonable defense.

Mega Millions Lottery Jumps to $550 Million: What to Do If You Win

The Mega Millions lottery drawing for the whopping $425 million produced no winners for the huge jackpot on Friday night. Friday the 13th did not get to shed its superstitious image of bad luck. The winning numbers of 19 – 24 – 26 – 27 – 70 – 12 were simply not matched. Now the new jackpot will rise up to a massive $550 million.

The last two jumps were up from $400 million and $344 million prior to that. Amazingly, this new $550 million lotto is still just the second largest jackpot ever for the Mega Millions lotto. If a winner for the full amount hits, then they will have the opportunity to take a lump sum cash payment of $295 million, or they can take 30 annual payments of roughly $18.3 million.

24/7 Wall St. wants to remind our readers that winning a vast fortune of this magnitude also brings the need for great responsibility. We have created a simple plan of what instant winners should (and should not do) in twelve steps if they happen to be lucky enough to win a vast fortune such as this.

There are some serious pitfalls for many lotto winners. In fact, it seems ironic to think that problems can arise after winning hundreds of millions of dollars. Can you imagine ending up bankrupt in a few short years? Believe it or not, many lotto winners have lost most of their money or even gone bankrupt just a few years after winning.

The record for the Mega Millions is up at $656 million. That jackpot on March 30, 2012, was split by three winning tickets in Illinois, Kansas and Maryland.

We cannot emphasize enough how important it is for lotto winners to take action and be mindful of pitfalls. Our own 12-step program for lotto winners is intended to be the first-step guide on how to protect your newly won empire. This pertains also to people who unexpectedly inherit large sums of money, win lawsuits with huge judgments, or who come into fortunes in short periods of time. We have evaluated what to do for tax purposes and financial and personal security, as well as what not go splurge on, and many other things.

What Amazon Wants You to Buy for the Holidays

Amazon.com Inc. (NASDAQ: AMZN) admitted that the discounts it gave on gifts during its Black Friday Deals Week and Cyber Monday Deals Week are over. Like every other retailer, it has to keep the attention of shoppers until the holidays have ended. So, it has launched a new set of incentives for people to shop on the most visited e-commerce site in America — its Top Holiday Deals event.

Amazon has targeted a few categories that it must believe are the most likely ones to lure shoppers. As it launched its new sales, it announced:

Just like during Black Friday and Cyber Monday, you’ll find limited-time sales and specials from across Amazon, including sales on electronics, low prices on DVDs, toy bargains, and fashionable deals on clothing, shoes, jewelry, and more.

Like every other retailer, Amazon has to take business from the two largest retailers — Wal-Mart Stores Inc. (NYSE: WMT) and Target Corp. (NYSE: TGT). However, Amazon’s new discounts are more focused than simply to take business from them.

Based on the merchandise sales Amazon has decided to pitch, its management believes that it has to continue to take revenue away from companies in several categories that continue to be strongholds of its most successful retail store competitors. Best Buy Co. Inc.’s (NYSE: BBY) fortunes have improved over the past two quarters, and its management has forecast a strong holiday season. Traditionally, Amazon has taken a greater and greater portion of the consumer electronics market. If that trend does not continue, Amazon’s growth rate will be dinged. Best Buy is the largest consumer electronics chain, and it has, according to its management, upgraded BestBuy.com to draw enough customers to start to steal market share back from Amazon.

5 Best Bank Stocks To Watch Right Now

Toys”R”Us is still the leader in its niche, despite the availability of toys at other large retailers. These retailers have, at most, a toy section in their locations or on their websites. Amazon management knows that market share taken from Toys”R”Us is market share taken from the retailer where many consumers decide to buy toys. Amazon’s toy discounts, if they work, are aimed to move people away from shopping at the market leader.

Clothing, shoes and jewelry are at the heart of what retailers Macy’s Inc. (NYSE: M), Sears and J.C. Penney Co. Inc. (NYSE: JCP) sell. Sears and J.C. Penney may be weak, but they still have more locations than almost any other retailers. Amazon management does not mind taking market share from companies that are already in trouble, if the share it is taking is in a big enough category. Clothing and accessories are among these.

The selection of Amazon’s Top Holiday Deals is hardly random. The sales are aimed to take the maximum number of customers it can from America’s largest retailers.

Transocean: A Lot to Like

Top 5 Penny Stocks To Own Right Now

It's usually a sign of underlying buying interest in a stock, when it gains in price on a day when the overall market is negative, suggests John Dobosz, editor of Forbes Dividend Investor.

That's what happened recently with Switzerland-based Transocean (RIG), the world's largest offshore contract driller for oil and gas wells.

There's a lot to like about Transocean these days. Last month, it struck a deal with Carl Icahn, who owns nearly 6% of the company, and was agitating for a number of changes.

He got another one of his people on the board of directors, and Transocean also cut the number of board seats from 14 to 11, giving existing members greater weight. Icahn also extracted a pledge that Transocean will boost profits by $800 million, through cost cutting, and increased efficiency.

Most significant for dividend investors is that Icahn succeeded in getting the company to agree to pay a $3 per share dividend next year, up 33.4% from the current $2.24 annual rate. Transocean will also explore spinning off some of its assets into a master limited partnership structure.

After taking a hit after the April 2010 explosion and spill, on its Deepwater Horizon rig at BP's Macondo Well in the Gulf of Mexico, earnings are back on the rise.

Analysts expect Transocean to earn $4.18 per share in 2013, up 5.5% from 2012. Revenue should be higher by 3.5% to $9.52 billion. Next year, earnings are forecast to grow 35%, with sales up 6.7%.

Current valuations make a good case for jumping into Transocean. Its average price-sales ratio, over the past five years, is 2.03, 6.4% higher than today's P/S multiple of 1.91. With $26.40 per share in expected sales this year, that average P/S implies a $53.60 stock price.

It trades at a 75% discount to its five-year average P/E ratio, but at 43.8 times trailing earnings, it's rather plump and reflects the effects of the spill costs.

Nonetheless, at 8.9 times next year's earnings, which are growing at better than a 30% clip, the stock is pretty cheap.

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Texas Instruments Downgraded to “Reduce” at Nomura Securities (TXN)

Before Thursday’s opening bell, Nomura Securities downgraded Texas Instruments (TXN) from “Neutral” to “Reduce” and has left TXN’s price target unchanged at $33.

Nomura believes that TXN no longer has future margin benefits, and that the price its trading too high relative to its peers.

Romit Shah, an analyst at Nomura, had the following comments about the downgrade: “While TI’s execution has been solid, we believe the company’s performance is well respected and understood. TI is trading at a 10-year high to Intel (85% premium versus an average of +3%) and Qualcomm (10% discount versus an average of -58%). Margin benefits from optimizing free cash flow that have been a big boost to the stock may have run their course. In addition, we believe that revenue growth despite a diminishing wireless drag may continue to be modest. Furthermore, we estimate that share repurchases at current levels are barely reducing share count. Our target price is unchanged at $33 and is based on a multiple of 15x 2014E EPS, excluding net cash.”

Nomura’s price target on TXN suggests a 23% downside to TXN’s current stock price.

TXN shares were inactive in pre-market trading. This year, the company’s stock is up 32.5%

Delta raises fares during peak holiday season

Just in time for the peak holiday travel season, Delta Air Lines has increased fares by $4 to $10 roundtrip across most domestic routes.

Several airlines had matched the increase of 1 p.m. ET, though it was no guarantee that the hike would stick.

Regardless, this marks the 12th time this year that airlines have tried to raise fares. But they have not been as successful as they have been in the past.

Only three fare hikes have stuck this year, two of them initiated by Delta.

"Domestic airlines have had little success raising base airfares in 2013 as consolidation and the transition to 90% load factors continue," says Rick Seaney, CEO of FareCompare.com, which tracks fares.

The last time an airline was able to raise fares in December was 2010 when oil prices were in the low $90s, Seaney says.

Last year, there were 15 attempts to raise fares, and seven were successful.

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In 2011, there were 22 attempts, and nine stuck.

So far, American -- including merger partner US Airways -- and United had matched on many routes, according to FareCompare. Alaska Airlines had matched on routes on which it codeshares with Delta.

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Typically, air fare increases don't succeed unless low-cost carriers such as Southwest Airlines participate.

Seaney says there has been "no activity as yet from Southwest or JetBlue" on matching the increase.

"Historically US Airways has not scuttled many hikes so I don't believe the newly minted American will change this dynamic much," Seaney says in a note about the latest fare hike. "It will be interesting to see how much leverage Southwest Airlines potential lack of participation has in scuttling domestic hikes given the culmination of four years of consolidation."

In particular, S! eaney says he wonders whether the big airlines American, Delta and United will "tiptoe around Southwest" or if they'll "be forced to rollback or completely disregard" the attempt.

8 Ways My Theater Degree Helps Me Succeed as a Business Owner

Getty Images/Blend Images RM A major in theater often sits atop lists of the most useless college degrees, but by studying theater as an undergrad, I actually think I learned how to bootstrap my business. (I also went to a state college, so it was an affordable theater degree. Shout out to Minnesota State University - Mankato!) Here's a list of the valuable skills I acquired there that I've taken to heart over the last 10 years, and how they affect my business today. 1. Show Up In theater, if you don't audition, you won't get cast. You have to put yourself out there. Nowadays, I email people I don't know. I didn't know that this was weird. I've always reached out to people whose work I admire. I email people every week, and I don't expect anything in return. Sometimes I get an email back; sometimes I don't. But that's OK, because I just wanted to let that person know how his or her work has affected me. In theater, you audition for show after show after show, and you rarely get cast -- but if you don't put yourself out there, you'll never get cast. People ask how I've managed to get so much press in the past year; the answer simple: I'm not afraid to put myself out there. 2. Connect With People Immediately Theater always attracts the most interesting characters, and you learn to accept people for their uniqueness. You also learn how to get along with people who drive you nuts. More importantly, theater taught me how to connect with people instantly. I love finding out what others are interested in and connecting them with others who share their interests. I learned (just a few years ago) that this is called "networking." I thought everyone did this!

Get used to being rejected -- and get over it.

Again, I connect with people and form relationships without expecting anything in return. It's fun for me, and it's helped me grow my business because other people will say, "I'm going to connect you with so-and-so about blah-blah-blah" and then an email later, we're connected! It's often the people skills or "soft skills" that separate those who are successful in business from those who aren't. I love making friends with new people who share my passions. It's part of the reason I love Twitter so much! 3. Get Used to Hearing 'No' As a performer, I auditioned for shows all the time. The process goes like this: You go in, you do a one-minute monologue, sing 16 bars of a song, say "thank you," and that's it. You often don't hear back. When you do, it's called a "callback." (Side note: I got a callback for the lead in almost every musical in college, but never got cast as the lead even once. This means it was down to me and a few other girls. At the time, that was soul crushing, but read on.) I think this is really good training for an entrepreneur because you get used to hearing "no." Some prospects become clients, and some don't. Regardless, the best thing you can do is learn from the experience and move on to the next one. Get used to being rejected -- and get over it. 4. Be Entertaining You should enjoy your business and make it fun -- that's what keeps life interesting. I really love to teach, and I truly believe it's my job to educate my clients about their money. I also love giving presentations on money to high school or college students. I try to make them fun and entertaining. It's because of my theater training that I'm not afraid to give an impromptu speech at an event, speak in a classroom, or give a toast at a friend's wedding. It's called improvisation, and it's something I learned in college. Daniel Pink mentions the importance of improv in his book "To Sell Is Human," which I highly recommend. These are life skills that can help anyone who runs a business. 5. Work Your Butt Off I performed in 15 full-length shows while I was in college, plus dozens of scenes and workshops. (If you Google me, you're sure to find some hilarious performance photos that involved big hair.) I rehearsed from 6 p.m. to 10 p.m., Sunday through Friday, for most of my college career. I didn't know what "free time" was until I graduated and worked a day job. When you run your own business, you have to work your butt off. You're in control of your time, but it doesn't fall into the normal 8-to-5 week that most people work. I love that I can meet my mom for lunch on a Tuesday, but that also means sometimes I'm cranking out a blog post on a Saturday night. Do what you need to do to move your business forward every day. As a business owner, you either pay someone to do something for you, or you learn how to do it yourself. You'll be surprised at what a YouTube tutorial can teach you. (Quick: Do a YouTube search right now for whatever you want to learn!) Luckily, I'm a life learner, because it's been imperative that I "bootstrap" my business for the first year. 6. Learn From Experts and Invest in Yourself When you have an opportunity to learn from experts, take advantage of it. In theater, we call this a "master class." It's when a well-regarded director, producer or performer decides to teach a workshop. Yes, it costs money and it takes time and energy, but you should go. Why? Because you'll learn more in those few hours than you've learned in the last six months. In business, I do this by attending conferences and reading books. Actors are always taking voice lessons, dance classes, and investing in their craft. I learned the importance of investing in one's self from my undergrad years. I've always loved reading, but now that I own a Kindle, I'm a voracious reader. I spend money on books that have to do with marketing, personal growth, Gen Y, finance, and entrepreneurship. Learning from people who are at the top of their field will help you grow by leaps and bounds. This is why I love podcasts so much: They're a free way to listen to experts and apply their knowledge and advice to help me grow my business. (Check out my last post, 5 Podcasts That'll Help You Think Like an Entrepreneur). 7. Take Risks and Embrace Vulnerability Blogging is scary. Quitting your job to start a business is terrifying. These things take guts. I don't think that I'd have been as willing to take those leaps had I not been a theater major. I had four years of intense training on learning what it means to up the stakes, take risks and be vulnerable. Example: Sometimes you show up to an audition and you're paired with some guy (who you don't know) to read a scene together. In the scene, you kiss. You have to kiss a person you just met and pretend to be madly in love with him, with only enough prep time to read through the scene once and say, "Hi. I'm Sophia. Nice to meet you." (Really, this happens all the time.) As a business owner, you have to put yourself out there: with your website, your blog, and through social media. It might not always be pretty or perfect, but that's OK. It's part of being human, and most people like the fact that you're not perfect. It's part of embracing vulnerability. (Need help? Watch Brené Brown's TED Talk on the power of vulnerability.) All of this is enormously challenging, but it's worth it. At times, I've received a few hurtful comments, but for the most part, my community really enjoys the content I'm creating and supports my work, so it inspires me to keep going. 8. Never Stop Creating

What Should Investors Do With Small Cap Universal Display Corporation (OLED)? GLW, DAKT & SGOC

Small cap flat panel display stock Universal Display Corporation (NASDAQ: OLED) was hit by bearish news in late November and the trend lines on its technical charts appear to be confused as to what direction the stock will head, meaning its probably time to take a closer look at the situation along with the stock's performance verses that of flat panel display peers like large cap Corning Incorporated (NYSE: GLW) and small cap players like Daktronics, Inc (NASDAQ: DAKT) and SGOCO Group Ltd (NASDAQ: SGOC)

What is Universal Display Corporation?

Small cap Universal Display Corporation is a world leader in the development of innovative organic light-emitting diode (OLED) technology for use in flat panel displays, lighting and organic electronics. Universal Display Corporation also has one of the largest patent portfolios in the OLED field with licensing rights to over 1,000 issued and pending patents worldwide in a broad array of OLED technologies, materials and processes.  Moreover, Universal Display Corporation has entered into more than 30 business agreements with leading manufacturers in Japan, Korea, Taiwan, China, Europe and the US including with companies such as Chi Mei EL, DuPont Displays, Konica Minolta, LG Display, Samsung SMD, Seiko Epson, Sony, Tohoku Pioneer and Toyota Industries.

For reference, Corning Incorporated is also an LCD glass maker; Daktronics is a designer and manufacturer electronic scoreboards, programmable display systems and large screen video displays; and the SGOCO Group Ltd is focused on product design and brand development in the Chinese flat panel display market.  

What You Need to Know or Be Warned About Universal Display Corporation?

Near the end of the week just before Thanksgiving, Universal Display Corporation plunged nearly 20% in inter day trading only to close down in the high single digits after the company announced that the European Patent Office (EPO) had issued a decision on the previously-disclosed appeal of a prior ruling relating to a patent held by the company (the opposing parties being Sumitomo Chemical Company, Merck Patent GmbH and BASF SE). Apparently, the EPO panel revoked the patent previously allowed by the lower EPO, which had upheld the broadest claim of coverage for organometallic iridium device architectures.

Besides the fact that Universal Display Corporation has more than 3,000 patents, the press release noted:

"The EP '238 patent is one of more than sixty patents issued worldwide that cover four early fundamental phosphorescent OLED inventions developed at Princeton University and the University of Southern California, which are exclusively licensed to Universal Display Corporation."

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Nevertheless, Canaccord Genuity's Jonathan Dorsheimer reiterated a Sell rating on the shares and said:

"Universal Display Corp just lost its appeal for core patent EP '238.' We believe this decision is potentially transformational and likely to affect the Samsung agreement, roughly +90% of OLED sales."

However, Jagadish Iyer of Piper Jaffray noted:

"While this ruling is unlikely to change the course of the Samsung licensing agreement we believe it puts a dent in the armor of OLED given that its core patent for phosphorescent OLED material (iridium based organometallic) has been revoked. We expect OLED to appeal while we see its negotiating power with upcoming customers (LG, AUO) likely gets weakened."

Canaccord Genuity's Jonathan Dorsheimer then issued another bearish note last Monday which pointed out that if Samsung is stuck because of how it negotiated the contract, an extension beyond the expiration in 2017 is less likely. Dorsheimer also believes that a European ruling could prompt "further negative rulings in other geographies, including the US," resulting in increased competition that could make it harder for it to sign "favorable commercial agreements in the future."

Share Performance: Universal Display Corporation vs. GLW, DAKT & SGOC

On Wednesday, small cap Universal Display Corporation rose 1.6% to $33.67 (OLED has a 52 week trading range of $22.78 to $39.74 a share) for a market cap of $1.56 billion plus the stock is up 31.4% since the start of the year and up 361.9% over the past five years. Here is a look at the long term performance of Universal Display Corporation verses that of Corning Incorporated, Daktronics and SGOCO Group Ltd.:

As you can see from the above chart, small cap Universal Display Corporation has outperformed large cap Corning Incorporated and small caps Daktronics and SGOCO Group Ltd.

Finally, here is a look at the most recent technical charts for all four stocks:

The Bottom Line. Given the messy or uncertain situation with the patent and Samsung contracts, new investors will probably want to stay away from Universal Display Corporation or at least wait for some clarity. However, current investors do not appear to be panicking as the stock has not plunged – meaning Canaccord Genuity's fears could be unfounded.