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Navistar (NYSE:NAV) has been unable to profit from the improving trucking market. The company's shares are down more than 7% this year, as competition from rival PACCAR (NASDAQ:PCAR) and Navistar's own weak product development moves have taken a toll on its performance.

When the company released its latest second-quarter results, it reported a loss of $297 million. However, it should be noted that Navistar is trying its best to execute a turnaround, and its second-quarter report also points in the same direction. Navistar narrowed its loss from the year-ago quarter, and it also gained market share.

What's working?

Navistar's "Drive to deliver" turnaround plan seems to be working well, as the company's order backlogs increased 82% in the previous quarter from last year. The company also gained market share in class 6/7 trucks and class 8 markets. In fact, its class 6/7 market share increased to 26.4% from 25.8% in

Complete Story » By SA PRO Top Ideas:

Top Idea: DTS Inc. by Helix Investment Research: Long / Consumer Goods - Electronics / GARP / Small-Cap / Margin Expansion / Relative Valuation / 25% Upside

Top Idea: MGIC Investment Corporation by REIT Analyst: Long / Financial - Mortgage Insurance / Other / Mid-Cap / Lagging Market Sentiment / mREIT Expert / 100% Upside

Top Idea: Jason Industries by New Capital: Long / Conglomerate - Industrial / Event/Special Situation / Micro-Cap / Newly Public Company / Underfollowed / 50% Upside

Top Idea playing out: RDEN (Elizabeth Arden) by Jeremy Raper, June 27, 2014. -25.4% (See author update »)

Top Idea playing out: IRDM (Iridium Communications) by BuyTheDip SellTheRip, December 23, 2013. +43.4%

New PRO Research: Limited, Air Lease Corp., A.M. Castle, A.O. Smith Corporation, ArcelorMittal, Bonanza Creek Energy, EXCO Resources, Fortuna Silver, Ideal Power, International Tower

Complete Story » By New Capital:


Jason Industries (NASDAQ:JASN) is a global industrial manufacturing company with leading market share positions across each of its four segments: finishing, seating, acoustics and components. Jason was founded in 1985 and till June 2014 was a privately held company. It became public through a merger transaction, which was equivalent to an IPO just more hidden from the eyes of investors and media.

On June 30, 2014 Jason Industries was acquired by Quinpario Acquisition Corp (QPAC). Quinpario was a blank check company formed in mid 2013 by Jeffry Quinn as a special purpose acquisition vehicle (SPAC) with the aim of affecting a merger. In its IPO (August 2013) Quinpario raised net proceeds of $177m by issuing 18.4m units at $10/unit (comprised of redeemable common stock and warrant). These funds together with additional borrowings are used to finance the merger.

Since incorporation QPAC was listed on NASDAQ and after the merger

Complete Story » By Helix Investment Research:

For more than 2 decades, DTS, Inc. (NASDAQ:DTSI) has been a part of most consumers lives without them ever knowing. Despite its status as one of the world's top manufacturers of audio recording, delivery, and playback systems, few consumers are likely to have ever heard of the company, despite its near-ubiquitous status in consumer entertainment. While DTS' business may be mundane, we believe that its profit potential is not. With a clear pathway towards an expanding market, DTS is well positioned to grow both revenues and profits at a rate that is far more exciting than its underlying business. Backed by a clean balance sheet, with the necessary capital to retain and expand its market position, we see upside of over 27% for shares of DTS as the company continues to execute on its growth initiatives. Unless otherwise noted, financial statistics and managerial commentary used in this article will be

Complete Story » By REIT Analyst:

While I usually focus on mortgage REITs, which I can model quite accurately, I recently have taken a close look at mortgage insurance. Indeed, I realized I could model their business reasonably well, and it now appears to me that MGIC Investment Corporation (NYSE:MTG) offers a mispriced and attractive exposure to mortgage credit.

My analysis tells me that factoring in the next 10 years of cash flows, at 10% yield, MTG is worth about 2.1x its current market price, even assuming the business does not grow. Basically, relative to the actual risks of defaults barring a mortgage meltdown, mortgage insurance ("MI") fees are large compared to the actual losses one can reasonably expect.

MGIC and the mortgage insurance business

MGIC is in the business of insuring mortgage credit, essentially for the GSEs (Fannie Mae and Freddie Mac). MGIC collects about 55bps of the mortgages' balance per year (which the servicer

Complete Story » By Pater Tenebrarum:

By Chris Hunter

One of the water-cooler conversations at Bonner & Partners is whether the Shiller P/E - the valuation ratio popularized by Yale economist Robert Shiller - is worth a damn. If you're not already familiar with the Shiller P/E, here's a quick introduction…

The standard price-to-earnings ratio looks at a company's share price compared to its per-share earnings. And it either looks at per-share earnings from the last four quarters (known as the trailing P/E)… or from the expected per-share earnings for the next four quarters (known as the forward or projected P/E).

The Shiller P/E works a little differently. Instead of dividing stock prices by per-share earnings over the preceding 12 months or using per-share earnings estimates for the next 12 months, it divides stock prices by the inflation-adjusted earnings over the preceding 10 years.

According to Shiller, his measure (also known as the CAPE, which stands

Complete Story » By John Vincent:

This article is the first in a series that provides an ongoing analysis of the changes made to Dan Loeb's US stock portfolio on a quarterly basis. It is based on Third Point's regulatory 13F Form filed on 08/14/2014. Dan Loeb founded Third Point in June 1995 with $3.3M raised mainly from friends and family. His management style is a combination of traditional value investing, long/short event-driven (bankruptcy or spin-off), and an activist philosophy that buys into troubled businesses with inefficient management. The idea in the latter case is to attempt to replace management through activism thereby helping increase shareholder value over time.

Dan Loeb has an enviable long-term performance track-record. From inception in December 1996 through Q2 2014, Third Point's flagship offshore fund returned 17.8% annualized return compared to 7.5% for the S&P 500 index. 2008 was the worst-performing year when it lost close to one third of its

Complete Story » By Winning Strategies:

Over the past few years, the food sector has experienced volatile commodity prices which have led to fluctuating margins and profitability. McCormick & Company (NYSE:MKC) is among those companies which have been proving their entity as defensive investments for investors mainly because it has the ability to prosper in any business environment. With the emergence of private labels and increased competition, the packaged food industry sales have started declining and margins have also started trimming. This has impacted a number of other companies but McCormick has put in place the right plan at the right time to cope with these headwinds.

The company wants to generate a consistent mid-single digit growth in its top-line and a double digit growth in its earnings. With the intention of making a consistent growth in its top-line, McCormick has a plan in place which continues to work for the company. The plan is simple:

Complete Story » By InvestAlike:

Hewlett-Packard (NYSE:HPQ) is the last company of this earnings season to report its quarterly result. However, this wasn't the only special thing about HP this season. The company has been making good progress lately. For the first time in three years, it delivered top-line growth on a year-over-year basis. This just improves the future outlook of this computer manufacturer, and explains why the stock price is up by 36% in a year.

In this article, I will tell the investors what HP did during its recent quarter. After that, I will discuss the future potential of this organization.

Third Quarter

Riding a recent revival in PC shipments, HP posted a 1% increase in year-over-year revenue to $27.6 billion. The company's Personal Systems "PS" segment, which includes PCs and notebooks, grew by 12% year over year. Volume for PS improved 13% which was very impressive since desktops account for 30% of

Complete Story » By Daniel Jones:

After the market closed on Aug. 21, shares of The Gap (NYSE:GPS) inched up almost 1% to $43.50 in response to the retailer's management team posting revenue and earnings that exceeded expectations for the second quarter of its 2014 fiscal year. According to its press release, the company's revenue for the quarter came out to $3.98 billion, representing a roughly 3% improvement over the $3.87 billion management reported for the second quarter of its 2013 fiscal year and coming in just a hair above the $3.97 billion analysts anticipated as its store rose 4% year-over-year from 3,428 locations to 3,565. During this timeframe, however, comparable store sales were flat.

Earnings Overview Last Year'sForecastedActualRevenue (billions)$3.87$3.97$3.98Earnings per Share$0.64$0.69$0.75

Looking at profits, the situation appears even more favorable for Gap. For the quarter, the company reported earnings per share of $0.75. This represents

Complete Story » By Cam Hui, CFA:

I have written about this topic before (see He who solves this puzzle shall be King), but in his weekly commentary, John Mauldin wrote about developing bubbles. Mauldin referenced the following chart (from Doug Short) of market cap to GDP as Warren Buffett's favorite valuation metric to show that stock market valuations are stretched.

I have called this same indicator as Buffett's favorite valuation metric before. However, I have not seen him publicly reference this ratio in interviews in the last 10 years. I am therefore re-considering the validity of this valuation measure.

The market cap to GDP ratio is really shorthand for an aggregate price to sales ratio. Recall that the price to earnings ratio is price to sales divided by net margin - and corporate net margins have risen considerably over the past few years and created distortions in both the P/E and P/S ratios. This chart

Complete Story » By Gary Bourgeault:

There's been a lot of interest generated by Amazon Inc. (NASDAQ:AMZN) concerning its new Amazon Local Register, which allows businesses to incorporate a mobile payment service into their operations.

Most of the talk has been concerning the amount of potential Amazon has in regard to taking market share from competitors in the space, including current market leader Square. To penetrate the market quickly, Amazon is offering a super deal to prospective clients, with those signing up by October 2014 getting a transaction rate of 1.75% through January 2016. For any retailer doing significant sales of any kind, that is a huge deal, against the 2.75% Square charges per transaction.

It will also underwrite the $10 cost of the device by crediting the first $10 in transaction fees back to the business, essentially removing any perceived cost of the service. After January 2016, the transaction fee will jump to 2.5%,

Complete Story » By The Value Investor:

Patterson Companies (PDCO), the conglomerate focusing on dental, veterinary and medical businesses, reported its first-quarter results for its new fiscal year for 2015.

Results were largely in line with estimates. While I like the long-term growth in sales and consistent share repurchases, I don't like shares at a modest premium compared to the overall market. This is unless the company will finally tackle the compression of long-term margins after building a more diversified conglomerate over the past decade.

As such I remain on the sidelines for now.

A Solid Start To The Fiscal Year

Patterson posted first-quarter sales of $1.06 billion for the fiscal year of 2015, being up by 20.4% compared to last year. Reported revenues came in just ahead of consensus estimates at $1.04 billion.

Despite reporting rapid top-line growth, earnings growth has been lagging as earnings improved by just 9.6% to $50.3 million. Amidst modest

Complete Story » By Dean Popplewell:

By Stuart McPhee

Gold for Friday, August 22, 2014

Over the last few days gold has been easing lower back towards the medium term support level at $1290 however in the last 24 hours it has fallen sharply back to the previous key level at $1275 which has held it up for a little while. A couple of weeks ago gold had been meeting resistance around $1313 which has seen it finally ease lower to end last week and at the start of this week. Just prior to that it moved well away from the support level at $1290 and back up well above $1300 to a two week high above $1322 before easing lower. It had also been easing lower and placing pressure on the support level at $1300 which eventually gave way resulting in gold falling sharply back down to a six week low near $1280 a few

Complete Story » By Sarita Pereira:

Satellite imagery has applications in the energy, agriculture, natural resources, insurance, and construction industry. The global satellite imagery market is expected to increase from $2.05 billion in 2012 to $5.01 billion in 2019. In June this year, the U.S. government eased its restriction on satellite imagery to customers other than the U.S. government. Effective from 2015, the resolution limit has been changed from 50 centimeters square (or cm) of ground space per pixel to 25 cm per pixel, which will improve quality of satellite images.

Recently, DigitalGlobe (NYSE: DGI) launched its commercial imagery satellite WorldView-3 to capture better images of the earth from space. WorldView-3 has a specified mission life of seven and a quarter years, with an estimated service life of 20 years. The satellite will photograph 680,000 square kilometers (or km) per day. The planned orbital height of the satellite is 617 km, which will give it images

Complete Story » By The Entertainment Oracle:

Young adult novels have always been a box office staple…Harry Potter, Twilight, The Hunger Games, etc. This year Divergent was added to that list, but it is not just the franchise series that may prove profitable. The Fault In Our Stars became one of the summer's biggest hits and this week Warner Brothers (a subsidiary of Time Warner (NYSE:TWX) is looking for lighting to strike twice with If I Stay.

(Credit: Warner Brothers)

Let's be clear from the start, Stay is not going to have a $50 million opening like Stars. That particular teen drama is an anomaly and a profitable one at that, but you can't expect that every time. Audiences love seeing their favorite novels come to life, but as we saw with The Weinstein Company's Vampire Academy, sometimes the movies don't always open to expectations. This fall we have three more young

Complete Story » By Long-Short Value:

All of the 13F filings are in for the top Hedge Funds and Money Managers around the country. I have looked through all of the funds that I consider to be the top tier value investors in the world and I have come up with my recommendations of which new fund additions are most interesting Value Long ideas.

The funds included in my Elite Value Investors list are as follows: Baupost Group (Seth Klarman), Greenlight Capital (David Einhorn), Appaloosa Management (David Tepper), FPA Capital (Bob Rodriquez), Yacktman Funds (Donald Yacktman), Southeastern Asset Management (Mason Hawkins), Ariel Investments (John Rogers), Omega Advisors (Leon Cooperman), Duquesne Family Fund (Stan Drunkenmeyer), Fairholme Fund (Bruce Berkowitz), Brave Warrior Advisors (Glen Greenburg), Dalal Street LLC (Mohnish Pabrai), Hayman Capital (Kyle Bass), and Glenview Capital Management (Larry Robbins). Although there are other Value investors that have great ideas like GMO Capital (Jeremy Grantham) and Gotham Capital

Complete Story » By Doug Young:

A look at the latest earnings from online travel agent Qunar (NASDAQ:QUNR) and online classified ad site (NYSE:WUBA) made me feel like I was living in a parallel universe where everything was the opposite of what it should be. Qunar, China's second largest online travel agent backed by leading search engine Baidu (NASDAQ:BIDU), saw its loss soar 10-fold as its costs grew far faster than revenue. And yet investors welcomed the results, bidding up the company's stock by 6 percent. Conversely, the profitable saw its earnings more than double, and yet its stock tanked nearly 8 percent on the report.

Of course everyone knows that this kind of share movement is all about how the results compared with expectation, and company outlook is also often more important than results for the past quarter. In Qunar's case, investors seem to like the company's aggressive spending on its mobile business,

Complete Story » By Price Point:

Chesapeake Energy (NYSE:CHK), the second largest natural gas producer in the United States, has taken a number of actions in the last one and a half years to reduce the complexity of its corporate and capital structure. Some of these actions combined with strong oil output have eased some of its near-term liquidity concerns. A few of these steps included the divestiture of Chesapeake's midstream business, the sale of non-core oil and gas assets and investments, and the spin-off of the Oklahoma City based company's oilfield services business to CHK's shareholders.

The company used the proceeds from these asset sales to eliminate various forms of financing including certain of its VPPs, operating and financing leasing, subsidiary preferred stock issues, and other debt. The company in the last one and a half year has considerably reduced its net leverage. Chesapeake's net leverage, including preferred stock and off-balance sheet obligations fell approx.

Complete Story » By Cullen Roche:

Sometimes it's easier to understand the big picture with the simplest indicators. And two of the more trusted ones in the macro arsenal are the PMI reports and the weekly jobless claims reports. They're not exactly "real-time", but when you're taking the macro view (which is an inherently longer-term perspective) then these are pretty close to as "real-time" as we need.

The first chart is the Markit US Manufacturing PMI. Yesterday's Flash release for August showed a 17 month high at 58. 50 is the contraction level so we're now

Complete Story » By Don Dion:

Bank of America (NYSE:BAC) will pay about $17 billion to the Department of Justice and to consumers to settle its well-publicized shoddy mortgage practices.

The bank, headquartered in Charlotte, North Carolina is the second biggest bank in the U.S. by assets and twenty-first largest by revenue. The DOJ has accused the bank of packaging substandard mortgages into securities and then selling these to investors. It's believed that these low-grade mortgages precipitated or aggravated the financial crisis in 2008.

Biggest Settlement in US History

The fine that Bank of America will have to pay is the biggest settlement in United States history between the government and a single corporation.

(click to enlarge)


Although the full scope of the investigation into the bank have not yet been made public, Bank of America, like the other three major banks in the US - JPMorgan Chase (NYSE:JPM), Citigroup (NYSE:C), and Wells

Complete Story » By Dr. Duru:

Last month, I wrote that there was no need for alarm over the plunge in housing starts for June mainly because the Southern region drove the entire decline while all other regions in the U.S. were up year-over-year. Moreover, rising (or stabilizing) home builder sentiment directly contradicted that data. Roll the tape forward and home builder sentiment continues to recover and, more importantly, housing starts for July surged over June and July, 2013 levels. Once again, the South led the way.

According to the Census Bureau:

Privately-owned housing starts in July were at a seasonally adjusted annual rate of 1,093,000. This is 15.7 percent (±10.9%) above the revised June estimate of 945,000 and is 21.7 percent (±10.7%) above the July 2013 rate of 898,000.

Single-family housing starts in July were at a rate of 656,000; this is 8.3 percent (±10.3%) above the revised June figure of 606,000. The July

Complete Story » By John Cochrane:

WSJ Oped, here.

As Federal Reserve officials lay the groundwork for raising interest rates, they are doing a few things right. They need a little cheering, and a bit more courage of their convictions ...

I like the large balance sheet and market interest on reserves. I just want them to be permanent, not additional tools for Fed discretionary policy.

I'll post the whole thing in 30 days.

The Oped builds on a new paper, Monetary Policy with Interest on Reserves, and on Toward a Run-Free Financial System. In the latter, I advance the idea that the Fed and Treasury should first offer interest-paying money, and then stamp out private substitutes, just as the US first offered banknotes and then stamped out run-prone substitutes in the 19th century. Interest on reserves, a big balance sheet, and opening reserves to all are a first step.

There are some

Complete Story » By SA Transcripts:

Duet Group (OTCPK:DUETF)

Q2 2014 Earnings Conference Call

August 21, 2014 9:00 PM ET


David Bartholomew – CEO

Jason Conroy – CFO


Chris Laybutt – JPMorgan

Sandra McCullagh – Credit Suisse

Simon Chan – Merrill Lynch

Baden Moore – CLSA

David Leech – UBS

Will Allott – Commonwealth Bank

Nathan Lead – Morgans


David Bartholomew

Good morning. My name is David Bartholomew, Chief Executive Officer of Duet Group. For those present in the room, welcome to Duet’s 2014 Results Presentation. I’d also like to extend a warm welcome to those joining us via webcast and teleconference. Before commencing, I’d also like to introduce our Chief Financial Officer, Jason Conroy.

The agenda for today’s presentation is set out on slide 3. I’ll first summarize the highlights of the group’s performance. Jason will then present the group’s financial results. And after that I’ll provide an operational update for each

Complete Story » By Alex Pitti:

When most investors look at Michael Kors (NYSE:KORS) stock they probably see a growth brand that is currently doing fantastically, but may fall out of favor with consumers at any point. It is rational to feel this way when looking at these types of fashion companies because fashion styles are short lived. As Heidi Klum says on "Project Runway", which the man Michael Kors was previously a judge on, "One day you're in. and the next day, you're out". The most obvious example of a fashion company losing touch with the consumer is Coach (NYSE:COH). The company had a tough fiscal 2014 with negative revenue growth. I believe that although fashion can be very difficult to compete in, Kors will thrive in the long term as its designer has been working in the industry for over 30 years and is now in the enviable position where he sets the fashion

Complete Story » By The Federal Reserve Bank of Atlanta:

By Dave Altig, executive vice president and research director of the Atlanta Fed

As the early data on the third quarter begin to roll in, the (very tentative) conclusion is that nothing we know yet contradicts the consensus gross domestic product (GDP) forecast (from the Blue Chip panel, for example) of seasonally adjusted annualized Q3 growth in the neighborhood of 3 percent. The latest from our GDPNow model:

The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2014 was 3.0 percent on August 19, up from 2.8 percent on August 13. The nowcast for inventory investment ticked up following the Federal Reserve's industrial production release on August 15 while the nowcast for residential investment growth increased following this morning's new residential construction release from the U.S. Census Bureau.

The contribution of residential investment is obviously welcome, but the inventory contribution in

Complete Story » By Trading Champ:

VMware Inc. (NYSE:VMW), the leader in virtualization and cloud infrastructure, recently announced a strategic relationship with Arista Network. This four year relationship will focus on developing innovative offerings, integrated SDDC solutions, and joint marketing of generally available Arista and VMware integrated networking solutions for VMware NSX. VMware is trying to improve its virtualization and cloud infrastructure to increase its customer base. VMware generated $5.21 billion in revenues in 2013 and has more than 500,000 customers and 75,000 partners.

Over the years, VMware has showed good growth numbers and it's per share earnings grew 26.20% in the past five years. This is quite an impressive performance that has pushed the stock up. However, despite the good performance, like other tech stocks VMware has been showing a volatile price trend. Currently the stock is trading at $103.23 lower than its 52-week high of $112.89. In the last year this stock has returned

Complete Story » By Economics Fanatic:

Amidst a slowdown in the Chinese economy, Freeport-McMoRan (NYSE:FCX) has struggled in the last two years. If investors look at the two year stock price chart, the company's stock is trading at almost the same level it was trading two year before.

This is big underperformance at a time when equity markets in the United States has surged. This article discusses why the underperformance might end and why Freeport-McMoRan is a good stock to consider.

Freeport-McMoRan Is Undervalued

From an investment point of view, this is the first factor to consider. Freeport-McMoRan is undervalued as compared to peers and this presents a good buying opportunity. Readers might argue that the company might remain undervalued if growth remains weak. I will discuss in the sections to come why Freeport-McMoRan is likely to grow at a stronger pace going forward.

Freeport-McMoRan is currently trading at an EV/EBITDA of 6.2, a price to

Complete Story » By Dean Popplewell:

By Stuart McPhee

Australia 200 for Friday, August 22, 2014

The Australian 200 Index has finally been able to surge higher to a new six year high around 5650 a couple of days ago before easing off in the last 24 hours and consolidating just below this level. It has enjoyed a solid move higher over the last week bouncing strongly off the support level at 5400. Just prior to the surge it fell sharply over a couple of weeks returning back to more familiar territory between the 5400 and 5500 levels, before the recent strong rally. In its recent fall it moved down to a three week low around 5375, however at the beginning of last week it received solid support at the 5400 level which has allowed to consolidate and rally higher. The solid move higher a few weeks ago saw it move strongly up through both the

Complete Story » By SA Transcripts:

Qunar Cayman Islands Limited (NASDAQ:QUNR)

Q2 2014 Earnings Conference Call

August 21, 2014 8:00 p.m. ET


Jenna Qian – Head of Communications and IR

CC Zhuang – Co-Founder and CEO

Yilu Zhao – Chief Strategy Officer

Sam Sun – CFO


George Meng – Morgan Stanley

Alicia Yap – Barclays Capital

Vivian Hao – Deutsche Bank

George Askew – Stifel Nicolaus

Yuheng Fan – China Renaissance

Henry Guo – JG Capital

Juan Lin – 86Research

Eddie Leung – Bank of America Merrill Lynch

Yi Chen – Aegis Capital

Alex Yao – JPMorgan

Tian Hou – T.H. Capital

Ida Yu – China International Capital Corp



Hello, and welcome to Qunar's second quarter 2014 earnings conference call.

[Operator Instructions] Today's conference is being recorded for replay purposes. If you have any objections, you may disconnect at this time.

I would now like to turn the meeting over to you

Complete Story »
Updated: 1 hour 59 min ago

U.S. GDP Lifts Dollar And Stocks

30 Jul ’14

The US dollar is extending its gains in response to the strong US GDP figures. There are four elements of the report to note. First, the economy expanded by 4.0% in Q2, well above consensus expectations. Second, Q1 was revised to show a 2.1% contraction rather than 2.9%. Third, personal consumption improved to 2.5% from a revised 1.2% pace in Q1 (originally 1.0%). Fourth, and arguably even more significant that the growth itself is the core PCE deflator. It rose to 2.0% from 1.2%.

On a year-over-year basis, the US economy expanded by 2.4%, which is close to what economists view as trend growth. Recall that the part of the shock from Q1 was a drop in service consumption. Today's report has service consumption adding 0.31 percentage points to GDP. Inventories added 1.66% and trade subtracted 0.61%. Business investment contributed 0.9 percentage points to growth. It increased by 5.9% at

5 Undervalued Companies For Enterprising Investors With High Dividend Yields

30 Jul ’14

There are a number of great companies in the market today. By using the ModernGraham Valuation Model, I've selected five of the undervalued companies reviewed by ModernGraham with high dividend yields. Each company has been determined to be suitable for the Enterprising Investor according to the ModernGraham approach, which is a modernized version of legendary value investor Benjamin Graham's requirements for Intelligent Investing.

Defensive Investors are defined as investors who are not able or willing to do substantial research into individual investments, and therefore need to select only the companies that present the least amount of risk. Enterprising Investors, on the other hand, are able to do substantial research and can select companies that present a moderate (though still low) amount of risk. Each company suitable for the Defensive Investor is also suitable for Enterprising Investors.

To see the full valuations of each of the following companies, please

Diverging Trends For Non-Farm Payroll And Total Employment

30 Jul ’14

What does it mean when the trends for non-farm payroll jobs and total employment in the U.S. are on two separate and diverging tracks?

We're asking that question today because of something we've observed in the data for the state of Illinois while working on a different project. The chart below shows what we found when we looked at that state's total employment numbers and nonfarm payroll jobs since December 2012.

(click to enlarge)

Here, we observe that the trends for the state's total employment and for the state's non-farm payroll jobs would appear to be on diverging trajectories over time. As we've previously discussed in considering the differences between the Household and Establishment surveys that document employment trends in the U.S., that pattern is largely due to cyclical factors related to turning points in the economy:

One other factor that can contribute to differences between the two surveys' reported

Ligand: Pipeline Breakdown Reveals Bullish Outlook

30 Jul ’14

Executive summary

There are some innovative, smaller companies out there that have leveraged the increasingly complicated and unpredictable pharmaceutical industry through diversifying their portfolio of assets across numerous technology types, therapeutic indications, drug targets and industry partners. Ligand Pharmaceuticals (NASDAQ:LGND) is no exception.

During a time of impending patent expirations on major blockbuster drugs which have placed top-line pressure on large pharmaceutical companies, as well as increasing competition in many therapeutic areas, I believe Ligand has amassed one of the largest and most diversified portfolios of royalty-generating assets in the industry.

Thus, for those investors who've been searching for a de-risked mid-cap pharmaceutical play with encouraging prospects for long-term growth, I believe Ligand could be a great fit. Continue reading and I'll tell you why.

Size matters

In the pharmaceutical industry, it's prevalent that size matters -- that is, the size of the pipeline, of course. The primary reason an

Gilead's Massive Undervaluation: A Pictorial Overview

30 Jul ’14

My regular readers that follow me on Real Money Pro, Seeking Alpha or recently Investors Alley over the past six months know what a huge bull I am on Gilead Sciences (NASDAQ:GILD). Not only is it by far the biggest position in my portfolio but I also consider it the cheapest large cap growth stock in the market right now.

Although I have held the shares since the low $40s, I have kept adding shares to my portfolio, as I believe the Sovaldi juggernaut is just getting unleashed. I was especially active during the big biotech sell-off that triggered a decline into the mid $60s in March. This was a gift I do not believe will be repeated any time in the foreseeable future.

In previous articles I have discussed why Gilead's hepatitis C drug (Sovaldi) is on its way to being the biggest new drug in sales in

PDC Energy - Is Selling Overdone?

30 Jul ’14

The regulatory environment for oil and gas development in Colorado is attracting a lot of attention. Citizens, concerned about the quality of air and water pollution, are pushing for tighter regulations. Having effected some of the most aggressive anti-fracking rules in the country last year which require 500 to 1,000 foot drilling rig set-backs from occupied buildings, a new 2,000 foot set-back proposal has been tabled for the November 4, 2014 ballot together with tighter controls over drilling. Somewhat belatedly, drillers are now coming together to fight the proposed measures; on July 16 Anadarko (NYSE:APC), Whiting (NYSE:WLL) and Encana (NYSE:ECA) announced that they will collectively spend $50 million to counteract the ballot proposals.

It will be interesting to watch this story unfold over the next 3 months. It may have implications not just for Colorado but, to a greater or lesser extent, for the shale oil and gas industry across

Searching For High Yield And Diversification With ETNs

30 Jul ’14

Exchange-traded Notes (ETNs) are senior, unsecured, unsubordinated debt securities that provide investors with exposure to the total returns of various market indices, including those linked to stocks, bonds, commodities and/or currencies, less investor fees. ETNs must not be confused with ETFs (Exchange-traded Funds) - unlike ETFs, ETNs are bond instruments with a set maturity date that do not buy or hold assets to replicate or approximate the performance of the underlying index.

I think it is important that investors understand the concept of an ETN's indicative value and always keep track of that value in relation to the market price.

Indicative Value versus Market Price

An ETN's "indicative value" is used to measure the intrinsic value of each ETN and is calculated and published by the issuer at least once a day. However, the indicative value should be used for reference purposes only, and is not an indication of the

Update: Primero Mining Delays Its Construction Decision On Its Cerro Del Gallo Project

30 Jul ’14

Primero Mining (NYSE:PPP) announced that it is delaying its decision to construct its third mine - Cerro Del Gallo. According to the news report the decision was made so that management can develop a higher grade ore region in order to optimize the project given the low gold price environment. Management reassures us that the project is moving forward as the company continues to permit the project, work on basic engineering, and explore. Despite what the press release says I think that the decision to delay construction of Cerro Del Gallo is related to the Brigus Gold acquisition from earlier in the year. This is the case because estimated production costs are far too low for Primero to be concerned about the low gold price. While further drilling may be able to cut costs somewhat, it is hard to believe that it can do so meaningfully from the $725/oz. level

Q2 2014 Hospira Inc Earnings Conference Call (Webcast)

30 Jul ’14

The following audio is from a conference call that will begin on July 30, 2014 at 09:00 AM ET. The audio will stream live while the call is active, and can be replayed upon its completion.

Listen now

Q3 2014 Spectrum Brands Holding Earnings Conference Call (Webcast)

30 Jul ’14

The following audio is from a conference call that will begin on July 30, 2014 at 09:00 AM ET. The audio will stream live while the call is active, and can be replayed upon its completion.

Listen now

Q2 2014 Goodyear Tire & Rubber Earnings Conference Call (Webcast)

30 Jul ’14

The following audio is from a conference call that will begin on July 30, 2014 at 09:00 AM ET. The audio will stream live while the call is active, and can be replayed upon its completion.

Listen now

Q2 2014 Allstate Corp Earnings Conference Call (Webcast)

30 Jul ’14

The following audio is from a conference call that will begin on July 30, 2014 at 09:00 AM ET. The audio will stream live while the call is active, and can be replayed upon its completion.

Listen now

Q2 2014 Qep Resources Inc Earnings Conference Call (Webcast)

30 Jul ’14

The following audio is from a conference call that will begin on July 30, 2014 at 09:00 AM ET. The audio will stream live while the call is active, and can be replayed upon its completion.

Listen now

Q3 2014 Multimedia Games Hld Co Earnings Conference Call (Webcast)

30 Jul ’14

The following audio is from a conference call that will begin on July 30, 2014 at 09:00 AM ET. The audio will stream live while the call is active, and can be replayed upon its completion.

Listen now

Q3 2014 Destination Maternity Earnings Conference Call (Webcast)

30 Jul ’14

The following audio is from a conference call that will begin on July 30, 2014 at 09:00 AM ET. The audio will stream live while the call is active, and can be replayed upon its completion.

Listen now

5-Year Projection: S&P 500 Price, Earnings And Dividends Using Mean Reversion Growth

30 Jul ’14

One approach to seeking fair value, or simply what is most likely, over the intermediate-term to long-term is the assumption of mean reversion. That approach basically assumes that long-term means act a bit like gravity or a magnetic attraction that pulls on prices, earnings or dividends to return to the mean growth level.

It may take a lot of patience for that approach, and if there is a permanent structural change in markets, the former mean may not continue to serve as gravitational or magnetic attraction. On the other hand, structural changes are few and far between, making mean reversion a pretty good bet more often than not.

So, let's discover the long-term means for S&P 500 prices, GAAP earnings and dividends, and then apply those means to make reasonable 5-year projections of those dimensions into the future.

Let's use the S&P monthly data available from Professor Shiller at Yale

Robo-Buffett Funds On The Cheap

30 Jul ’14

By Samuel Lee

This article was published in the July 2014 issue of Morningstar ETFInvestor. Download a complimentary copy of ETFInvestor here.

In early June, State Street launched a series of foreign-equity SPDR exchange-traded funds tracking MSCI's Quality Mix, or QM, indexes. The funds charge 0.30%, making them the cheapest or near cheapest options in their respective categories.

The QM index rides on the coattails of AQR researchers Andrea Frazzini, David Kabiller, and Lasse Pedersen's paper "Buffett's Alpha," which argues that the returns of Buffett's public equity portfolio, estimated from quarterly 13F filings, can be explained by exposure to value, quality, and low-volatility (or, more precisely, betting against beta) factors. While I don't believe they've completely distilled Buffett's essence into a set of mechanical rules, they've captured enough of it.

The QM index doesn't replicate Frazzini et al.'s procedure; rather, it equal-weights MSCI's Value Weighted, Quality, and Minimum Volatility

Daily State Of The Markets: The Next 3 Reasons To Exhibit Some Caution

30 Jul ’14

Tuesday's stock market action was interesting on several fronts. In the morning, it appeared that the bulls were about to recover their lost momentum mojo in response to a second consecutive monthly surge in Consumer Confidence. But then the politicians started making headlines about new sanctions for Russia - and the bottom line is, yes, the algos noticed each and every one of those headlines.

At about 11:00 am eastern time, the major indices had moved to the high of the day and the S&P 500 had retraced all of the prior two days' declines. Things were looking up. After all, when consumers are in a good mood, they tend to spend more time at the malls and/or online - buying stuff. In short, the strong improvement in Consumer Confidence meant the argument could be made that the economy might be able to perform above expectations going forward.

However, about

The Amazon Fire Phone Will Fail

30 Jul ’14

The Amazon (NASDAQ: AMZN) Fire smartphone finally hit retail shelves late last week. Early reviews on the Fire phone, however, may be described as tepid, at best. For Modern Readers, Lorenzo Tanos referred to the Amazon Fire phone simply as "satisfactory." Alternatively, Credit Card Forum President Ben Woolsey dismissed the Fire handset as a "Trojan Horse," where its telecommunications features were supposedly "ancillary" to operations. The Fire will be the latest in a long line of Amazon bait-and-switch tactics that will ultimately torpedo the stock.

The Saturated Mobile Market

In early July, comScore published its May 2014 U.S. Smartphone Subscriber Market Share report. The title of the report, however, was somewhat misleading, as comScore statisticians actually presented averages for data compiled for the quarter spanning between the months of March and May. A quick review of the May 2014 U.S. Smartphone Subscriber Market Share report would reveal the presence

What I Bought Over The Last 4 Months, And Why I Bought It

30 Jul ’14

Before I get started I would like to take the time to apologize to those who enjoy following my work and the picks that I make for my portfolio for my lack of articles over the course of this quarter. I've recently accepted a farm management position growing grapes at a vineyard and was quite a bit busier this spring than I've been in the past planting and monitoring a new crop. That being said, I was still able to update readers on the moves I made throughout the quarter via the 'stock quote' system here on Seeking Alpha. When thinking about the first article I was going to write since my absence began, I knew that I wanted to write a reflective overview of those investments that I've made throughout the period of time that I've been away. Now that the Japanese beetle hatch is over and things have