Goliath Gold Miner Creation Has Failed

It's now official: Barrick Gold (NYSE: ABX  ) and Newmont Mining (NYSE: NEM  ) failed to negotiate a merger. This means that we will not see a creation of a $33 billion gold mining company – at least for now. Both Barrick Gold and Newmont Mining shares finished the day of the announcement on a sour note. However, I don't see that much reason for pessimism regarding the failed merger.

Press release quarrel highlights merger difficulties
The merger talks finished with the issue of belligerent press releases from both companies. In short, both Barrick Gold and Newmont Mining accused each other of the failed negotiations. Barrick stated that Newmont was trying to reverse the previously arranged terms regarding the location of the head office, the assets that would have been included in a spinoff company and the governance arrangements. In its turn, Newmont stated that it strongly disagrees with Barrick's view of the merger process.

This press release quarrel raises the important question of whether Barrick's and Newmont's union would have been organizationally viable. It looks like officials of both companies held different views on important things while negotiating the merger, and those views did not come closer to each other as a result of negotiations.

Not a merger of equal
The merger of Barrick Gold and Newmont Mining would not have been a merger of equal companies. Barrick Gold is bigger and more cost efficient. Newmont's recent first quarter earnings release revealed that the company was successful in pushing its all-in sustaining costs to $1,034 per ounce of gold. However, Barrick showed sub-$1,000 performances on the cost front in each quarter of 2013. Thus, the possible merger would have lifted the cost of mining gold for Barrick's shareholders.

Barrick stated that the proposed merger could have brought positive synergies on the cost front, but never mentioned which synergies it was talking about. The size of such savings was also unclear. At the same time, one could imagine the difficulties of running the joint company with a plethora of stalled projects and a pile of debt.

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Spinoff negotiations could have broken the deal
One thing that Barrick Gold mentions in its press release regarding merger discussions with Newmont is the asset composition of a spinoff company. Spinoffs often receive poorly performing assets, lifting the burden from the parent company. At the same time, the spinoff must be viable enough to continue operating on its own.

Importantly, shareholders do receive shares of the spinoff, and are still exposed to the performance of its assets, just like they were exposed to their performance when these assets were a part of a parent company. That's why the mix of assets in the spinoff is important. The fact that Barrick and Newmont were unable to strike a deal on the composition of the spinoff highlights the differences between the two companies.

Bottom line
So far, this is not a good year for deal making for big gold miners. Goldcorp failed to acquire Osisko Mining, and Barrick Gold failed to merge with Newmont Mining. I don't think that Barrick and Newmont shareholders should be disappointed with the outcome. The resulting company would have been huge and difficult to manage, while the obtained synergies might not have translated to real benefits.

OPEC is absolutely terrified of this game-changer
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Whirlpool Jumps On Earnings Beat: Should You Own Its Stock?

Whirlpool's (NYSE:WHR) Q2 adjusted earnings were better than expected sending its stock up more than 8% in heavy trading July 19. If you currently own its stock you might be wondering if you should take some profits given it's almost doubled in the past year. Others, who don't own, might be encouraged to get on board. Read on and I'll tell you what you should do in both cases.

Excellent Returns
Since Whirlpool hit a five-year low of $19.19 in March 2009, its stock's achieved an annualized total return of 59%, more than double the SPDR S&P 500 (NYSE:SPY), which gained 26% over those same 52 months. Believers of reversion to the mean will definitely see this as a danger sign. In their minds it's gone too far too fast and will need a cooling-off period. But that's just one point of view.

Gross-Profit-to-Assets
In the July 17 issue of the Globe and Mail, Ian McGugan looks at the concept of gross-profit-to-assets (GPA). He references a couple of people familiar with this relatively unknown method for selecting stocks. One of them, Robert Novy-Marx, is an associate professor of finance at the University of Rochester and believes that GPA, when compared to industry peers, is a better way of finding winning stocks than metrics like earnings or cash flow. Using the following criteria: (1) GPA ratio higher than peers, (2) gross profit increase over the past year, and (3) a positive change in the consensus analyst estimate over the past 90 days, McGugan came up with a list of 25 stocks. Whirlpool wasn't on it or any of its peers. Not to worry. In the table below I'll compare it to three of its nearest competitors based on market cap. This should provide a good indication whether Whirlpool's got more gas in the tank or not.

Whirlpool and Peers

Company	Gross-profit-to-Assets	% Change Gross Profit Past Year	Positive Earnings Revision Past 90 Days
Whirlpool	0.19	12.3%	Yes
Stanley Black & Decker (NYSE:SWK)	0.23	-2.4%	No
Parker-Hannafin (NYSE:PH)	0.29	7.8%	No
Textron (NYSE:TXT)	0.17	12.8%	Yes

Granted this is a small sample but the figures above send both positive and negative signals. In terms of GPA, Whirlpool delivers a gross-profit-to-assets ratio of 19%, 400 basis points lower than the average of its three peers. On the other hand, it grew its gross profit by 12.3% in 2012, 620 basis points better than the average of its peers.

Now, if we compare the four companies over the past five years, we get a slightly different picture. Whirlpool's average gross-profit-to-assets ratio over the past five years was 17%, 200 basis points lower than in 2012. Its peers also did better in 2012 with a GPA ratio 300 basis points higher than their average over the past five years.

Over the past four years, Whirlpool increased its gross profit by a cumulative 14.6%. Meanwhile, thanks to Textron falling out of bed, its peers averaged a cumulative decline of 2.7%, considerably worse than Whirlpool. However, if you take Textron out of the mix, Stanley Black & Decker and Parker-Hannafin grew by a cumulative 14.2%, only 60 basis points less than Whirlpool.

What Does It Mean?
It means that Whirlpool's 87% gain over the past 52 weeks is the market's way of rewarding the company for a job well done. Its Q2 results indicate it's a company on the rise. It now expects earnings per share as high as $10 in 2013, something it's never done. With a PEG ratio of 0.6 and a forward P/E ratio of 9.0, Whirlpool has PEG payback of just 5.2 years. This means that it will take just a little over five years to earn $128.91 per share. Any time you can do that you're in a great position.

Bottom Line
There's no doubt Whirlpool's on the rise. It fought hard through the recession and housing crisis and has come out the other side in great shape. If it can get operating margins above 6%, like they were a decade ago, $200 a share is well within reach by this time next summer.

If you already own its stock, you might consider taking some profits although I'd continue to maintain a position. If you can pick up some shares on future weakness at $110 or below--you should. If you don't own already, I'd buy some now with the intention of buying more on weakness below $110. You might consider a third now, another third should it fall below $110 and a final third below $100. I'm not sure if all that will come to pass but if so, I think you can still make money even though you're late to the party.

Healthcare Insiders Snap Up Stock

July brings what we sometimes affectionately refer to as the "dog days" of summer. The symptoms are universal: sluggishness and fatigue often bringing about wanderlust for the mountains or the seashore. Taking a look at insider activity of late, it appears that the dog days have also hit insiders, who furthered the Neutral streak in their buying and selling according to a recent update by InsiderScore.

Unflinching, we did an industry drill down to see if any sector has warmed this summer and discovered that the healthcare segment saw a red hot June as insiders snapped up shares.

We took a look at Achillion Pharmaceuticals (ACHN) after two directors bought 40,000 shares for $394,800. Dennis Liotta bought 20,000 shares for $158,100 and Jason Fisherman bought 20,000 shares for $155,000. InsiderScore gave Liotta a nod, writing, "Liotta has been a smart buyer at Achillion in the past. He bought the same number of shares here, this time at a price 28% higher, which is the highest price he has paid for shares."

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Synta Pharmaceuticals (SNTA) also caught our attention after four insiders, including the company's billionaire director Bruce Kovner bought over five million shares for $14.2 million.  He was joined by Co-Founder and CEO Safi Bahcall, who bought 50,000 shares for $213,700.

Sarepta Therapeutics (SRPT) saw its director Anthony Chase buy 10,000 shares for $385,000. Sarepta saw a slight uptick in share price around this time after it announced positive results in a Phase 2b extension study involving the use of eteplirsen as a treatment for patients with Duchenne muscular dystrophy.

InsiderScore notes that in buying, Chase reversed sentiment, as he sold shares last year at a lower rate.  "His move to buy shares here on strength in the stock shows strong conviction as the company once again reports positive data," writes InsiderScore.

Honorable mentions go out to Coronado Biosciences (CNDO), after its CEO Harlan Weisman and Jay Lobell, a longtime director, joined forces and bought 20,000 shares for $152,100; and to Anacor Pharmaceuticals (ANAC) after CFO Geoffrey Parker bought 33,000 shares for $224,300. InsiderScore noted that Parker's purchase was his largest to date and called it a "compelling positive event."

We'll try to keep on beating the summer heat here at Inside Scoop and we'll keep looking for those red hot buys.

Report: U.S. a 'Rising Star' of Global Manufacturing

Atisha Paulson/Bloomberg via Getty ImagesAn employee sews printed leather patterns for a Rebecca Minkoff handbag at the Baikal manufacturing facility in New York. DETROIT -- Call it the comeback kid. A new ranking of the competitiveness of the world's top 25 exporting countries says the United States is once again a "rising star" of global manufacturing thanks to falling domestic natural gas prices, rising worker productivity and a lack of upward wage pressure. The report, released Friday by the Boston Consulting Group, found that while China remains the world's No. 1 country in terms of manufacturing competitiveness, its position is "under pressure" as a result of rising labor and transportation costs and lagging productivity growth. The United States, meanwhile, which has lost nearly 7.5 million industrial jobs since employment in the sector peaked in 1979 as manufacturers shipped production to low-cost countries, is now No. 2 in terms of overall competitiveness, BCG said. The biggest factor driving the U.S. rebound, according to BCG: cheap natural gas prices, which have tumbled 50 percent over the last decade as a result of the shale gas revolution. Also contributing to the country's attractiveness, according to BCG, is "stable wage growth" -- a euphemism for the fact that, in inflation-adjusted terms, industrial wages here are lower today than they were in the 1960s even though worker productivity has doubled over the same period of time. "Overall costs in the U.S.," the report's authors write, "are 10 to 25 percent lower than those of the world's ten leading goods-exporting nations other than China" and on par with Eastern Europe. Another standout in the rankings is Mexico, which BCG categorizes as a "rising star" with lower average manufacturing costs than China. But the country failed to make BCG's list of Top 10 manufacturers because of other factors, including rampant crime and corruption. BCG arrived at the rankings using a proprietary index that focuses on four major factors: wages, productivity growth, energy costs and exchange rates. In addition to China, four other countries with reputations as low-cost production centers -- Brazil, the Czech Republic, Poland and Russia -- are classified as being "under pressure" in terms of their manufacturing costs.

Texas Instruments first-quarter profit rises

Texas Instruments Inc. posted a 35% increase in its first-quarter profit as the chip maker's revenue and margins improved.

Looking ahead, the company forecast second quarter per-share earnings of 55 cents to 63 cents on revenue of $3.14 billion to $3.40 billion. Analysts polled by Thomson Reuters projected per-share earnings of 52 cents on revenue of $3.15 billion.

The Dallas-based company (TXN) , whose chips are used for many kinds of devices purchased by consumers and businesses, has shifted its strategy to grapple with broad changes in the semiconductor market.

In January, the company announced plans to trim about 1,100 jobs, saying the reductions would affect employees in the U.S., Japan and India. TI said at the time it expected the moves to translate into about $130 million in annual savings by the end of 2014, and would trigger charges of about $80 million.

For the latest quarter, TI posted a profit of $487 million, or 44 cents a share, up from $362 million, or 32 cents a share, a year earlier. The latest results included a gain of $37 million, which benefited earnings by two cents a share and wasn't included in the company's prior guidance, related to sales of a site and other assets associated with previously announced restructuring actions, said TI.

Sales rose 3.4% to $2.98 billion.

The company in January had projected per-share earnings of 36 cents to 44 cents on revenue of $2.83 billion to $3.07 billion.

Gross margin widened to 53.9% from 47.6%.

In the latest quarter, sales of analog chips—the company's biggest top-line contributor—climbed 11%, while sales in the embedded processing business rose 17%.

Shares rose 1.7% to $47.25 in after-hours trading. Through Wednesday's close, the stock has risen 5.8% since the start of the year.

--Anna Prior

4 Tech Stocks Under $10 Making Big Moves

DELAFIELD, Wis. (Stockpickr) -- At Stockpickr, we track daily portfolios of stocks that are the biggest percentage gainers and the biggest percentage losers.

>>5 Stocks Set to Soar on Bullish Earnings

Stocks that are making large moves like these are favorites among short-term traders because they can jump into these names and try to capture some of that massive volatility. Stocks that are making big-percentage moves either up or down are usually in play because their sector is becoming attractive or they have a major fundamental catalyst such as a recent earnings release. Sometimes stocks making big moves have been hit with an analyst upgrade or an analyst downgrade.

Regardless of the reason behind it, when a stock makes a large-percentage move, it is often just the start of a new major trend -- a trend that can lead to huge profits. If you time your trade correctly, combining technical indicators with fundamental trends, discipline and sound money management, you will be well on your way to investment success.

>>5 Stocks Ready to Break Out This Month

With that in mind, let's take a closer look at a several stocks under $10 that are making large moves to the upside today.

Dot Hill Systems

Dot Hill Systems (HILL) designs, manufactures and markets a range of software and hardware storage systems for the entry and mid-range storage markets. This stock closed up 2.8% to $2.88 in Tuesday's trading session.

Tuesday's Range: $2.76-$2.95

52-Week Range: $0.72-$3.18

Tuesday's Volume: 126,000

Three-Month Average Volume: 178,425

From a technical perspective, HILL bounced modestly higher here right above some near-term support at $2.72 with lighter-than-average volume. This move is starting to push shares of HILL within range of triggering a major breakout trade. That trade will hit if HILL manages to take out some near-term overhead resistance at $2.98 to its 52-week high at $3.18 with high volume.

Traders should now look for long-biased trades in HILL as long as it's trending above support at $2.72 or above its 50-day at $2.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 178,425 shares. If that breakout triggers soon, then HILL will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $4 to $4.50.

Demand Media

Demand Media (DMD) creates content that responds to actual consumer demand. This stock closed up 0.79% to $5.10 in Tuesday's trading session.

Tuesday's Range: $4.98-$5.14

52-Week Range: $4.72-$9.88

Tuesday's Volume: 1.11 million

Three-Month Average Volume: 625,240

From a technical perspective, DMD trended modestly higher here with strong upside volume. This stock has been downtrending badly for the last two months, with shares moving lower from its high of $6.79 to its recent 52-week low of $4.72. During that downtrend, shares of DMD have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of DMD might be signaling that its downside volatility is over on the short-term, since the stock is rebounding sharply with volume off its 52-week low.

Traders should now look for long-biased trades in DMD as long as it's trending above its 52-week low of $4.72, and then once it sustains a move or close above some near-term overhead resistance levels at $5.19 to $5.46 with volume that hits near or above 625,240 shares. If we get that move soon, then DMD will set up to re-test or possibly take out its next major overhead resistance levels at its 50-day moving average of $5.95 to $6.50.

ChinaCache International

ChinaCache International (CCIH) is a provider of Internet content and application delivery services in China. This stock closed up 11.7% to $8.08 in Tuesday's trading session.

Tuesday's Range: $7.20-$8.18

52-Week Range: $3.50-$10.64

Thursday's Volume: 524,000

Three-Month Average Volume: 351,049

From a technical perspective, CCIH ripped sharply higher here and broke out above some near-term overhead resistance at $7.50 with above-average volume. This stock recently plunged lower from its high of $10.64 to its recent low of $6.62 with heavy downside volume flows. Following that drop, shares of CCIH have now started to rebound off that $6.62 low, which could be signaling the downside volatility for CCIH is over in the short-term.

Traders should now look for long-biased trades in CCIH as long as it's trending above Tuesday's low of $7.20 and then once it sustains a move or close above Tuesday's high at $8.18 with volume that hits near or above 351,049 shares. If we get that move soon, then CCIH will set up to re-test or possibly take out its next major overhead resistance levels at $9 to $10.

Vicor

Vicor (VICR) designs, develops, manufactures and markets modular power components and complete power systems. This stock closed up 2% to $8.94 in Tuesday's trading session.

Tuesday's Range: $8.74-$9.05

52-Week Range: $4.74-$9.49

Thursday's Volume: 44,000

Three-Month Average Volume: 52,332

From a technical perspective, VICR spiked higher here right above its 50-day moving average of $8.22 with lighter-than-average volume. This move is starting to push shares of VICR within range of triggering a big breakout trade. That trade will hit if VICR manages to take out Tuesday's high of $9.05 to its 52-week high at $9.49 with high volume.

Traders should now look for long-biased trades in VICR as long as it's trending above Tuesday's low of $8.74 or above its 50-day at $8.22, and then once it sustains a move or close above those breakout levels with volume that hits near or above 52,332 shares. If that breakout triggers soon, then VICR will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are its next major overhead resistance levels at $10.50 to $11.50.

To see more stocks that are making notable moves higher today, check out the Stocks Under $10 Moving Higher portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

>>4 Stocks Spiking on Unusual Volume

>>5 Dividend Boosters That Could Really Pay Off

>>5 Stocks Under $10 Set to Soar

Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including

CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

Flowers Foods Gets OK to Acquire Hostess Breads and Bakeries

Following the announcement last month that a pair of private equity investors will return Twinkies to store shelves on July 15, Flowers Foods (NYSE: FLO  ) said yesterday it has received regulatory approval to purchase the old Hostess Brands portfolio of breads, including Wonder, Nature's Pride, and Home Pride.

Flowers announced its intention to buy the assets in February for $360 million after Hostess had been crippled by events including a strike by the Bakery Workers union and sought bankruptcy protection. Flowers received approval from the bankruptcy court to make the acquisition in March and just needed to get approval under the Hart-Scott-Rodino Act, which deals with antitrust issues.

With that now having been gained, Flowers will get Hostess' bread brands, 20 bakeries, and 36 depots. It expects to complete the transaction in the coming weeks. Flowers Foods is one of the largest producers of packaged bakery foods, operating 44 bakeries and generating sales in 2012 that reached $3.05 billion. 

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UAW drops NLRB case to organize Volkswagen

Workers on the VW assembly line in Chattanooga.

NEW YORK (CNNMoney) The United Auto Workers has dropped its challenge of a vote to organize workers at Volkswagen's only U.S. plant that went against the union.

The National Labor Relations Board was set to start a hearing Monday on the UAW's complaint that Republican politicians improperly interfered before the Feb. 14 vote at the Chattanooga, Tenn. plant, which the union lost 712 to 626.

But the union issued a statement Monday saying it was dropping its appeal because fighting the election through the NLRB could have dragged on for years.

"The UAW is ready to put February's tainted election in the rear-view mirror," said UAW President Bob King in a statement.

The union said even if the NLRB ordered a new election -- the board's only available remedy under current law -- nothing would stop politicians and anti-union organizations from again interfering.

But some experts had suggested that the union stood little chance of winning a new vote, even if the NRLB ruled in its favor.

"Most people thought they'd win the first time around," said Gary Chaison, professor of industrial relations at Clark University. "I think the chances of winning a second vote will be more difficult than winning the first vote."

Sen. Bob Corker, R-Tenn., one of the politicians the UAW accused of improperly interfering in the election, also claimed the union was dropping its effort because it knew it couldn't win a new vote.

"This 11th hour reversal by the UAW affirms what we have said all along -- that their objection was nothing more than a sideshow to draw attention away from their stinging loss in Chattanooga," he said.

The UAW's efforts to organize nonunion plants is seen as crucial to its long-term survival.

So far the UAW has been limited to representing plants operated by U.S. automakers General Motors, (GM, Fortune 500) Ford Motor (F, Fortune 500) and Chrysler Group, as well as their suppliers. Plant closings over the last 15 years have cut into UAW membership. Meanwhile, automakers from Asia and Europe have opened more than 30 plants in the United States, and more than two-thirds of those plants are in the South.

Unlike most employers facing a union-organizing election, Volkswagen had stayed neutral on the vote. It even seemed to be encouraging workers to vote for the union, saying it hoped to set up a "works council" to improve productivity at the plant.

VW, which has German union members on its board, uses works councils at most of its plants worldwide. But U.S. labor law makes such councils difficult without an independent union in place

But Corker, Tennessee Gov. Bill Haslam and other leading Republican elected officials suggested that if the union won the organizing election it would scare away other companies looking at opening factories in the state, where unions are relatively rare. There were even threats that the state would deny VW $300 million in tax breaks it is seeking to expand the plant if the union won the vote.

The UAW says it will ask Congress to examine the use of federal funds in the state's incentives threat.

"Frankly, Congress is a more effective venue for publicly examining the now well-documented threat," King said.

Chaison said it could cause problems for the UAW and other unions should the NLRB rule politicians can't weigh in on labor disputes such as organizing efforts or strikes.

"If opponents of the union can be told to refrain from interfering, friends of the union can be told the same thing," he said. "Chattanooga is an unusual place for unions to organize. Most of the places where unions would organize -- places like New York, Las Vegas or Detroit -- politicians would stand in line to support ! a union. ! That would provide ammunition to employers to object if they lost an organizing vote."

Opponents of the union say the workers decided on their own that they didn't want or need the union. Workers at the VW plant make roughly $19 an hour, compared with about $26 to $28 an hour for veteran hourly workers at the Detroit automakers, although new hires at the unionized plants are making closer to $17.

Today's Falling Knife: Rexam Reveals Minor Profit Warning

LONDON -- Shares in Rexam  (LSE: REX  ) fell over 5% in early trade this morning after revealing a number of important changes in its half-year results.

The beverage-can maker issued a minor profit warning following "disappointing" volumes in South America and Western Europe over the last two months. North America continues to perform well, however. 

Today's news confirms previous indications that beverage-can volume growth began the year more slowly than planned. As a result, full-year performance is expected to be "modestly" lower than previously anticipated. 

Chief executive Graham Chipchase commented: 

It has been a challenging first half, but we have taken assertive action on costs to mitigate the impact on our performance and maintain our capital discipline. Although we are still in the midst of our seasonally important summer period, we are managing the business proactively to overcome these challenges, and we continue to expect full year performance to show improvement over 2012, even if progress is likely to be less than previously anticipated. 

The multi-faceted company has also decided to focus on producing beverage cans and, as such, has initiated the process to sell its health care division. Management claims that this will help to maximize shareholder value, with Chipchase stating: "Following the proposed sale of Healthcare, Rexam will be a focused beverage cans business with a strong balance sheet and a clear strategy to maximize long term shareholder value."

The company has seen steady growth in recent years, climbing as high as 546 pence in 2013. Rexam did also state that the summer season traditionally influences its results, and although today's news further depresses a share price that has been sinking since April's initial warning, at around 445 pence today the company could present a buying opportunity.

Of course, that is something only you can decide. Before attempting to grab this falling knife, though, you may wish to consult this free Motley Fool report, which explains how betting on battered shares can provide wonderful gains... if the underlying company recovers.

Anyway, if Rexam is tempting you today, please click here to read the Fool's exclusive "millionaire" report before you hit the buy button.

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Top 10 Diversified Bank Stocks To Own For 2015

It's fun to be right, but there's such a thing as being a little too right, too fast. Such is the case with China BAK Battery Inc. (NASDAQ:CBAK) ... a stock yours truly was touting as a buy-worthy ticker just two days ago following news from Tesla Motors (NASDAQ:TSLA) that it was getting into the battery-pack business so it could become its own supplier for its electric vehicle business (Tesla automobiles need a huge battery pack to run). If there was enough demand for a carmaker to get into the game, then surely it meant there was enough potential business for an established battery market to bear plenty of fruit for CBAK too.

As it turns out, the market agreed. CBAK has jumped 54% since the opening price on the 26th. You're welcome. Not get out - take your profit and go home, at least for the time being.

Top 10 Diversified Bank Stocks To Own For 2015: ANSYS Inc (ANSS)

ANSYS, Inc. (ANSYS) develops and globally markets engineering simulation software and services used by engineers, designers, researchers and students across a range of industries and academia, including aerospace, automotive, manufacturing, electronics, biomedical, energy and defense. The Company distributes its ANSYS suite of simulation technologies through a global network of independent resellers and distributors (collectively, channel partners) and direct sales offices in global locations. The Company�� product portfolio consists of ANSYS Workbench, multiphysics product, structural mechanics, fluid dynamics, explicit dynamics, electromagnetic, system simulation, simulation process and data management, academic, high-performance computing (HPC), geometry interfaces, meshing and Apache design low-power electronic solutions. On August 1, 2011, the Company acquired Apache Design, Inc.

ANSYS Workbench

ANSYS Workbench is the framework upon which the Company�� suite of advanced engineering simulation technologies is built. The ANSYS Workbench platform delivers productivity, enabling Simulation Driven Product Development.

Multiphysics

The Company�� multiphysics product suite allows engineers and designers to create virtual prototypes of their designs operating under multiphysics conditions. ANSYS multiphysics software enables engineers and scientists to simulate the interactions between structural mechanics, heat transfer, fluid flow and electromagnetics all within a single, engineering simulation environment.

Structural Mechanics

The Company�� structural mechanics product suite offers simulation tools for product design. These tools have capabilities that cover a range of analysis types, elements, contacts, materials, equation solvers and coupled physics capabilities all focused towards understanding and solving complex design problems.

Fluid Dynamics

The Company�� fluid dynamics product suit! e offers modeling of fluid flow and other related physical phenomena. Fluid flow analysis capabilities provide all the tools needed to design new fluids equipment and to troubleshoot already existing installations. The fluid dynamics product suite contains general-purpose computational fluid dynamics software and specialized products to address specific industry applications.

Explicit Dynamics

The Company�� explicit dynamics product suite simulates events involving short-duration, large-strain, large-deformation, fracture, complete material failure or structural problems with complex interactions. This product suite is used for simulating physical events that occur in a short period of time and may result in material damage or failure.

Electromagnetics

The Company�� electromagnetics product suite provides field simulation software for designing high-performance electronic and electromechanical products. The software streamlines the design process and predicts performance - all prior to building a prototype - of mobile communication and Internet-access devices, broadband networking components and systems, integrated circuits (IC) and printed circuit boards (PCB), as well as electromechanical systems such as automotive components and power electronics equipment.

System Simulation

The Company delivers the ability to perform complete simulation studies as a system for some of the product designs. This is accomplished through a complete set of physics solutions that are integrated into a multiphysics capabilities set. A collaborative simulation environment provides modeling scalability for evaluating entire systems, including three dimensional (3-D) high-fidelity models, multibody dynamics, circuit reduced-order models, and any combination of these.

Simulation Process and Data Management

ANSYS Engineering Knowledge Manager (ANSYS EKM) is a solution for simulation-based process and data management. ANSY! S EKM pro! vides solutions to all levels of a company, enabling an organization to address the issues associated with simulation data, including backup and archival, traceability and audit trail, process automation and intellectual property protection.

Academic

The Company�� academic product suite provides a portfolio of academic products based on several usage tiers: associate, research and teaching. Each tier includes various noncommercial products that bundle a range of physics and advanced coupled field solver capabilities. The academic product suite provides entry-level tools intended for class demonstrations and hands-on instruction. It provides flexible terms of use and more complex analysis suitable for doctoral and post-doctoral research projects. The Company also provides a product suitable for student use at home.

High-Performance Computing

The Company�� HPC product suite enables insight into product performance. The HPC product suite delivers cross-physics parallel processing capabilities for the full spectrum of the Company�� simulation software by supporting structural, fluids, thermal and electromagnetic simulations in a single HPC solution.

Geometry Interfaces

The Company offers geometry handling solutions for engineering simulation in an integrated environment with direct interfaces to all CAD systems, support of additional readers and translators. It also offers an integrated geometry modeler focused on analysis.

Meshing

Creating a mesh that transforms a physical model into a mathematical model is a critical and foundational step in almost every engineering simulation study. The Company�� meshing technology provides a means to balance these requirements, obtaining the right mesh for each simulation in the most automated way possible.

Apache Design Low-Power Electronic Solutions

The Company�� suite of Apache software delivers power analysis and optimization pl! atforms a! long with integrated methodologies that provide capabilities for managing the power budget, power delivery integrity, and power-induced noise in an electronic design, from initial prototyping to system sign-off. These solutions deliver correlation to silicon measurement, and the capacity to handle an entire electronic system, including IC, package, and PCB.

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 Ansys (Nasdaq: ANSS  ) , whose recent revenue and earnings are plotted below.

• [By Northrop Puckett]

  The company is facing headwinds in the broader economy. This can be seen in declining sales in many areas of their business. Regionally, the U.S was flat; Northern Europe was up; Southern Europe was down; and emerging markets were down. Autodesk also lowered quarterly and yearly revenue expectations. This lowering of guidance by Autodesk also matches the same guidance changes made by competitors Parametric Technology (PMTC) and ANSYS (ANSS), so it is not necessarily losing out to its rivals in this case.

• [By Seth Jayson]

  Margins matter. The more Ansys (Nasdaq: ANSS  ) keeps of each buck it earns in revenue, the more money it has to invest in growth, fund new strategic plans, or (gasp!) distribute to shareholders. Healthy margins often separate pretenders from the best stocks in the market. That's why we check up on margins at least once a quarter in this series. I'm looking for the absolute numbers, so I can compare them to current and potential competitors, and any trend that may tell me how strong Ansys's competitive position could be.

Top 10 Diversified Bank Stocks To Own For 2015: TransAlta Corporation (TAC)

TransAlta Corporation operates as a non-regulated electricity generation and energy marketing company. The company engages in the production and sale of electric energy through its diversified portfolio of facilities fuelled by coal, natural gas, hydroelectric, wind, geothermal, and biomass resources in Canada, the United States, and Australia. It has an aggregate net ownership interest of approximately 8,025 megawatts of generating capacity in operation. The company was founded in 1911 and is based in Calgary, Canada.

Advisors' Opinion:

• [By alicet236]

  TransAlta Corporation (TAC) Reached the Five-Year Low of $12.78

  The prices of TransAlta Corporation (TAC) shares have declined to close to the five-year low of $12.78, which is 47.9% off the five-year high of $23.30. TransAlta Corp. is owned by one Guru we are tracking. Among them, zero have added to their positions during the past quarter. One reduced their position. TransAlta Corp. was incorporated under the Canada Business Corporations Act in March 1985. TransAlta Corp. has a market cap of $3.43 billion; its shares were traded at around $12.78 with a P/E ratio of 96.80 and P/S ratio of 1.46. The dividend yield of TransAlta Corp. stocks is 8.71%. TransAlta Corp. had an annual average earnings growth of 0.20% over the past 10 years.

5 Best Solar Stocks To Watch Right Now: Brookfield Infrastructure Partners LP (BIP)

Brookfield Infrastructure Partners L.P. engages in the utilities, transportation and energy, and timber businesses. It operates through Utilities, Transport, Energy, and Timber segments. The company operates a port facility that exports metallurgical and thermal coal mined in the central Bowen Basin region of Queensland, Australia; approximately 9,900 kilometers of electricity transmission lines in North and South America; and approximately 2.5 million electricity and natural gas connections in the United Kingdom, New Zealand, and Colombia. It is also involved in the transportation of freight, bulk commodities, and passengers through a platform of approximately 5,100 kilometers of tracks in southwest region of Western Australia; 3,200 kilometres of toll roads in Brazil and Chile; and approximately 30 port terminals primarily in Europe. In addition, the company provides energy transportation, distribution, and storage services through 15,500 kilometers of natural gas transm ission lines primarily in the United States. Further, it engages in the timberland operations with approximately 343,000 net acres of freehold timberlands located in the coastal region of British Columbia, Canada; and the Pacific Northwest region of the United States. Brookfield Infrastructure Partners Limited serves as a general partner of Brookfield Infrastructure Partners L.P. The company was founded in 2007 and is based in Toronto, Canada. Brookfield Infrastructure Partners L.P. is a subsidiary of Brookfield Asset Management Inc.

Advisors' Opinion:

• [By Dan Caplinger]

  Weyerhaeuser hasn't hesitated, though, to make some smart strategic moves. Last month, the company agreed to pay $2.65 billion to buy the Longview Timber business from Brookfield Asset Management (NYSE: BAM  ) and Brookfield Infrastructure Partners (NYSE: BIP  ) . By selling, Brookfield will be able to reinvest proceeds into areas that are more consistent with its current focus. Meanwhile, Weyerhaeuser picks up timberland in the Pacific Northwest that has easy access to Asian export markets, letting it take further advantage of tight supply conditions caused by the mountain pine beetle's huge presence further north in British Columbia.

• [By Mike Arnold]

  Brookfield is a recent spin-off (April 2013) from Brookfield Asset Management (BAM) ("BAM"), who has a history of spinning out businesses which subsequently outperform. For a case study, one might take a look at Brookfield Infrastructure Partners (BIP) as part of their due diligence procedures, which has significantly outperformed the S&P 500 since its listing.

Top 10 Diversified Bank Stocks To Own For 2015: IMAX Corp (IMAX)

IMAX Corporation, incorporated on January 1, 2002, together with its wholly owned subsidiaries, is an entertainment technology companies, specializing in motion picture technologies and presentations. The Company�� customers who purchase lease or otherwise acquire the IMAX theatre systems are theatre exhibitors, which operate commercial theatres, museums, science centers, and destination entertainment sites. IMAX theatre systems combine the Company�� digital re-mastering movie conversion technology (IMAX DMR), projectors with equipment and automated theatre control systems, sound system components, screens, theatre geometry, and theatre acoustics.

The Company�� principal business is the design, manufacture and delivery of theater systems (IMAX theater systems). The Company�� customers who purchase, lease or otherwise acquire the IMAX theater systems through joint revenue sharing arrangements are theater exhibitors that operate commercial theaters (particularly multiplexes), museums, science centers, or destination entertainment sites. The Company does not own IMAX theaters, but licenses the use of its trademarks along with the sale, lease or contribution of the IMAX theater system.

IMAX Systems, Theater System Maintenance and Joint Revenue Sharing Arrangements

The Company provides IMAX theater systems to customers on a sales or long-term lease basis with an initial 10-year term. These agreements consist of initial fees and ongoing fees (which can include a fixed minimum amount per annum and contingent fees in excess of the minimum payments) and maintenance and extended warranty fees. The initial fees vary depending on the system configuration and location of the theater and generally are paid to the Company in installments between the time of system signing and the time of system installation. Ongoing fees are paid over the term of the contract, commencing after the theater system has been installed and are generally equal to the greater of a fixed minimu! m amount per annum or a percentage of boxoffice receipts. The Company also provides IMAX theater systems to customers under joint revenue sharing arrangements, pursuant to which the Company provides the IMAX theater system in return for a portion of the customer�� IMAX box-office receipts, and in some cases concession revenues and/or a small upfront or initial payment. As at December 31, 2012, the Company had 316 theaters in operation under joint revenue sharing arrangements.

Production and Digital Re-Mastering (IMAX DMR)

The Company�� technology digitally re-masters Hollywood films into IMAX digital cinema package format or 15/70-format film. IMAX DMR digitally enhances the image resolution of motion picture films for projection on IMAX screens while maintaining or enhancing the visual clarity and sound quality to levels for which The IMAX Experience is known. This technology enabled the IMAX theater network to release Hollywood films simultaneously with domestic release. In a typical IMAX DMR film arrangement, the Company will receive a percentage of net box-office receipts of any commercial films released in the IMAX network, which is generally 10-15%, from a film studio for the conversion of the film to the IMAX DMR format and access to its distribution platform. During the year ended December 31, 2012, 35 films converted through the IMAX DMR process were released to theaters within the IMAX network. As of December 31, 2012, the Company released 23 IMAX DMR titles to theaters within the IMAX network. During 2012, five local language IMAX DMR films were released, including one French film, Houba! On the Trail of the Marsupilami: The IMAX Experience and four Chinese IMAX DMR titles: Tai Chi 0: An IMAX 3D Experience, Tai Chi Hero: An IMAX 3D Experience, Back to 1942: The IMAX Experience and CZ12: The IMAX Experience.

Film Distribution and Post-Production

The Company is also a distributor of large-format films, primarily catering to its institution! al theate! r partners. The Company generally distributes films, which it produces or for which it has acquired distribution rights from independent producers. The Company generally receives a percentage of the theater box-office receipts as a distribution fee. Films produced by the Company are typically financed through third parties, whereby the Company will generally receive a film production fee in exchange for producing the film and a distribution fee for distributing the film. The Company utilizes third-party funding for the majority of original films it produces and distributes. In 2012, the Company, along with Warner Bros. Pictures (WB) and MacGillivray Freeman Films (MFF) released an original title, To the Artic 3D: An IMAX 3D Experience.

The Company derives a small portion of its revenues from other sources. As of December 31, 2012, the Company had four owned and operated theaters. In addition, the Company has a commercial arrangement with one theater resulting in the sharing of profits and losses and provides management services to two theaters. The Company also rents its two dimensional (2D) and three dimensional (3D) large-format film and digital cameras to third party production companies. The Company maintains cameras and other film equipment and also offers production advice and technical assistance to both documentary and Hollywood filmmakers. Additionally, the Company generates revenues from the sale of after-market parts and 3D glasses. As of December 31, 2012, approximately 54.2% of IMAX systems in operation were located in the United States and Canada. As at December 31, 2012, approximately 45.8% of IMAX systems in operation were located within international markets (other than the United States and Canada).

Advisors' Opinion:

• [By Tim Beyers]

  IMAX (NYSE: IMAX  ) , meanwhile, will be counting on a rush of fans paying for early access to its large-format screenings. That approach set records around the world with Iron Man 3. (China, in particular.)

• [By Rick Aristotle Munarriz]

  Companies can make brilliant moves, but there are also times when things don't work out quite as planned. From an ill-conceived entry into the crowded tablet market to the leading online retailer jacking up its minimum order size for free shipping, here's a rundown of the week's best and worst moves in the business world. Zynga (ZNGA) -- Winner Zynga has a long way to go to regain its former status as a market darling, but the casual and social gaming giant is doing its best to claw its way back. Zynga turned heads by posting a narrower loss than analysts were forecasting on Thursday night. Zynga also announced that it was hiring a former marketing manager from Electronic Arts (EA) to help beef up the presence of its mobile games. Bookings have fallen sharply at Zynga, but investors may rediscover the once hot stock with London-based King -- the company behind the wildly popular Candy Crush Saga -- getting ready to go public. Tablet Tuesday -- Loser It was supposed to be a great day for tablets. Tuesday treated gadget buffs to Nokia (NOK) announcing its first tablet, Microsoft (MSFT) starting to sell its Surface 2 and Surface Pro 2 tablets, and Apple (AAPL) unveiling its latest line of iPads. The morning kicked off with Nokia introducing a Lumia-branded tablet. The problem is that it runs Windows RT, the operating system that's so unpopular that Microsoft took a $900 million inventory charge earlier this year to write off the weak-selling Surface RT. Then came Microsoft tablets arriving at retailers, including the Surface 2 that happens to run, yes, on Windows RT. Apple's event went far better, but the stock sold off after the presentation. One concern is that the new iPad mini is getting an increase in price. Apple has never boosted the price of next-gen iPads, but now it's doing so with the smaller iPad mini. That may not go over so well in a market where competing tablets have only gotten cheaper over time. IMAX (IMAX) -- Winner They say that the

Top 10 Diversified Bank Stocks To Own For 2015: Agilysys Inc.(AGYS)

Agilysys, Inc., together with its subsidiaries, provides information technology (IT) solutions to corporate and public-sector customers primarily in North America. It operates in three segments: Hospitality Solutions Group (HSG), Retail Solutions Group (RSG), and Technology Solutions Group (TSG). The HSG segment offers application software and services that streamline management of operations, property, and inventory for customers in the gaming, hotel and resort, cruise lines, food management services, and sports and entertainment markets. The RSG segment provides solutions for retailers to enhance productivity, operational efficiency, technology utilization, customer satisfaction, and in-store profitability that comprise customized pricing, inventory, and customer relationship management systems. This segment also offers implementation plans and supplies the hardware package required to operate the systems, including servers, receipt printers, point-of-sale terminals, and wireless devices for in-store use by retail store associates. The TSG segment provides various solutions that comprise enterprise architecture, infrastructure optimization, storage and resource management, identity management, and business continuity for the finance, government, healthcare, telecommunications, education, and other industries. The company was founded in 1963 and is headquartered in Solon, Ohio.

Advisors' Opinion:

• [By Evan Niu, CFA]

  What: Shares of Agilysys (NASDAQ: AGYS  ) have soared today by as much as 11% after the company reported earnings.

  So what: Revenue in the fiscal fourth quarter rose 21% to $63 million, with the company's retail segment driving nearly all of those gains. Non-GAAP net income per share came in at $0.15, swinging into the black relative to the $0.16 per share adjusted loss a year ago. CEO James Dennedy said the company outperformed its expectations for the year.

• [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 Agilysys (Nasdaq: AGYS  ) , whose recent revenue and earnings are plotted below.

Top 10 Diversified Bank Stocks To Own For 2015: Route1 Inc (ROI)

Route1 Inc. (Route1) delivers security and identity management solutions to corporations and government agencies that need universal, secure access to all digital resources and sensitive data. These customers depend on The Power of MobiNET Route1�� communications and service delivery platform. MobiNET provides identity assurance and individualized access to networks and data. The Company operates in two revenue segments: devices and appliances and services. On September 30, 2010, the Company completed of the pilot project to deploy the Company�� DEFIMNET platform, TruOFFICE application software, and MobiKEY Fusion devices to the United States Navy Reserve Forces Command (RESFOR). On April 13, 2010, the Company announced the release of TruOFFICE application software version 2.8 with strengthened security and Windows 7 support. Advisors' Opinion:

• [By Chuck Carnevale]

  Next, I turned to an evaluation of gross profit margin (gpm), net profit margin (npm), return on assets (roa), return on equity (roe) and return on invested capital (roi). The example below only includes gross and net profit margin, however, I review data on all the metrics stated above.

• [By Michael Ugulini]

  Sentiment and semantics are for greeting cards; stakeholders want Return on Investment (ROI) and will raise a glass of suds to widespread distribution via powerhouse Anheuser-Busch's network over a "craft" distinction for some brands.

Top 10 Diversified Bank Stocks To Own For 2015: Oil States International Inc.(OIS)

Oil States International, Inc., through its subsidiaries, provides specialty products and services to the oil and gas drilling and production companies worldwide. It operates in four segments: Accommodations, Offshore Products, Well Site Services, and Tubular Services. The Accommodations segment offers temporary and permanent work force accommodation services for people working in remote locations. The Offshore Products segment designs and manufactures flexible bearings and connector products; sub sea pipeline products; marine winches, mooring systems, and cranes and rig equipment; and conductor casing connections and pipes, as well as provides blowout preventer stack assembly, integration, testing, and repair services; and drilling riser and related repair services. The Well Site Services segment offers a range of products and services that are used to drill for, and establish and maintain the flow of oil and gas from a well throughout its lifecycle. This segment engages in the rental of wireline and coiled tubing pressure control equipment; wellhead isolation equipment; pipe recovery systems; thru-tubing fishing services; hydraulic chokes and manifolds; blow out preventers; well testing and flowback equipment; gravel pack operations on well bores; and surface control equipment and down-hole tools utilized by coiled tubing operators. This segment also provides land drilling services. The Tubular Services segment distributes a range of casing and tubing products; and offers threading, logistical, and inventory management services. The company serves national oil companies, independent oil and gas companies, onshore and offshore drilling companies, and other oilfield service and mining companies. Oil States International, Inc. was founded in 1995 and is based in Houston, Texas.

Advisors' Opinion:

• [By Holly LaFon]

  Another area that is intriguing to us is the North American energy sector which looks to have a number of interesting catalysts currently. While the energy sector is at present only a modest overweight in the portfolios, we have been encouraged by several trends taking place for a number of years. These positive developments are also having an impact that goes far beyond the energy sector itself. Many believe that the U.S. will become energy independent and possibly a net exporter of natural gas and oil (currently restricted by law) in the next decade. This opinion is based primarily on the development of new drilling techniques (i.e. horizontal drilling, and high pressure fracking) that have enabled companies to access oil and natural gas reserves in shale formations that were previously not economically viable. The ability to tap into this acreage is a game-changer in our view and is already having a tremendous impact on the economy. Employment rates in these mostly rural areas surrounding the shale basins are very high and companies thus find hiring extremely competitive. Strong labor markets tend to create strong local economies. Oil States International (OIS) has been able to capitalize on this trend by providing housing and other services to oil service workers that are in demand in the area. CST Brands (CST) operates gas stations in Texas, but it is increasingly looking to broaden its product offering beyond fuel. Rail companies like Union Pacific (UNP), Canadian Pacific (CP), Kansas City Southern (KSU) and Genesee and Wyoming (GWR) have also benefited substantially. Given that shale areas are rural and often lacking infrastructure, substantial investment must be made to support drilling and production activities. Without pipelines in place, railroads have been the primary takeaway mechanism for moving production to the various clusters of refining capacity around the United States. In order to serve this demand, massive investment in railcars has been nee

Top 10 Diversified Bank Stocks To Own For 2015: United States Steel Corporation(X)

United States Steel Corporation produces and sells steel mill products in North America and Central Europe. It operates in three segments: Flat-rolled Products (Flat-rolled), U. S. Steel Europe (USSE), and Tubular Products (Tubular). The Flat-rolled segment offers slabs, rounds, strip mill plates, sheets, and tin mill products, as well as iron ore and coke. This segment serves service center, conversion, transportation, construction, container, and appliance and electrical markets in North America. The USSE segment offers slabs, sheets, strip mill plates, tin mill products, and spiral welded pipes, as well as heating radiators and refractory ceramic materials. This segment serves the European construction, service center, conversion, container, transportation, and appliance and electrical, as well as and oil, gas, and petrochemical markets. The Tubular segment offers seamless and electric resistance welded steel casing and tubing; and standard, and line pipe and mechanical tubing. It primarily serves customers in the oil, gas, and petrochemical markets. The company also provides transportation services, including railroad and barge operations. In addition, it owns, develops, and manages various real estate assets, which include approximately 200,000 acres of surface rights primarily in Alabama, Illinois, Maryland, Michigan, Minnesota, and Pennsylvania; participates in joint ventures that are developing real estate projects in Alabama, Maryland, and Illinois; and owns approximately 4,000 acres of land in Ontario, Canada. The company was founded in 1901 and is headquartered in Pittsburgh, Pennsylvania.

Advisors' Opinion:

• [By Sean Williams]

  Not far behind Peabody was steelmaker U.S. Steel (NYSE: X  ) , which added 4.4% on the day despite no company-specific news. Given that Peabody produces metallurgical coal used in the steelmaking process, strength in Peabody's results could ease worries about U.S. Steel's upcoming quarter. In addition, U.S. Steel is among the most short-sold companies within the S&P 500, meaning any rally could potentially start a chain reaction of short-covering that could send shares higher. Keep in mind, though, that with more net debt than many of its peers, U.S. Steel also offers some of the highest risks among steel stocks.

• [By Alex Planes]

  The day's most notable gain was that of non-Dow stock Auburn Automobile, which skyrocketed 40% due to what would later be revealed as stock manipulation by Auburn owner Errett Cord (the company's tiny float made it highly susceptible to such meddling). Many Dow components rose as well, with industrial bellwether U.S. Steel (NYSE: X  ) advancing despite reports that its unfilled orders had fallen further than expected. This drop was waved off by The New York Times, which blamed "seasonal tendencies" for the 150,000-ton order decline. Its strong performance in spite of the purportedly bad news helped drag many of its Dow peers along for the ride.

• [By Dan Caplinger]

  The entire steel industry has experienced sluggish performance in light of the slowdown in China and weak conditions in Europe and elsewhere around the world. Already, we've seen U.S. Steel (NYSE: X  ) report much worse-than-expected earnings as well as project further challenges for the industry ahead. Given ArcelorMittal's particularly large exposure to Europe, it stands to lose the most from austerity measures that have brought the European economy to the brink of recession.

Top 10 Diversified Bank Stocks To Own For 2015: Office Depot Inc.(ODP)

Office Depot, Inc., together with its subsidiaries, supplies office products and services. Its North American Retail division sells an assortment of merchandise, such as general office supplies, computer supplies, business machines and related supplies, and office furniture under various labels, including Office Depot, Viking Office Products, Foray, Ativa, Break Escapes, Niceday, and Worklife through its chain of office supply stores. It also provides printing, reproduction, mailing, shipping, and other services, as well as personal computer support and network installation service. As of December 25, 2010, this division operated 1,147 office supply stores in the United States and Canada. The company?s North American Business Solutions division sells nationally branded and private brand office supplies, technology products, furniture, and services to small- to medium-sized customers through a dedicated sales force, catalogs, and Internet. Its International division sells o ffice products and services through direct mail catalogs, contract sales forces, Internet sites, and retail stores using a mix of company-owned operations, joint ventures, licensing and franchise agreements, alliances, and other arrangements. As of December 25, 2010, it sold its office products to customers in 53 countries in North America, Europe, Asia, and Latin America. This division operated, through wholly-owned or majority-owned entities, 97 retail stores in France, Hungary, South Korea, and Sweden; and participates under licensing and merchandise arrangements in South Korea, Thailand, India, Israel, Japan, and the Middle East. The company was founded in 1986 and is headquartered in Boca Raton, Florida.

Advisors' Opinion:

• [By Rich Duprey]

  Ever since private-equity firm Starboard Value became Office Depot's (NYSE: ODP  ) largest shareholder late last year, the two have been butting heads over replacing the company's board members. A court ruling firmly setting the date of the office-supply retailer's annual meeting has both sides claiming victory.

Top 10 Diversified Bank Stocks To Own For 2015: Armstrong World Industries Inc (AWI)

Armstrong World Industries, Inc. (AWI), incorporated on December 30, 1891, is a global producer of flooring products and ceiling systems for use in the construction and renovation of residential, commercial and institutional buildings. The Company designs, manufactures and sells flooring products (resilient and wood) and ceiling systems (mineral fiber, fiberglass and metal) globally. The Company segments includes: Building Products, Resilient Flooring and Wood Flooring. The Company�� Building Products, Resilient Flooring, Wood Flooring and Cabinets segments sell products for use in the home. Its products are used in new home construction and existing home renovation work. Its products, primarily ceilings and Resilient Flooring, are used in commercial and institutional buildings. On September 1, 2012, it sold Patriot Flooring Supply, Inc. to The Belknap White Group. Effective October 31, 2012, the Company sold of its cabinets business to American Industrial Partners.

Building Products

Building Products produces suspended mineral fiber, soft fiber and metal ceiling systems for use in commercial, institutional and residential settings. In addition, its Building Products segment sources complementary ceiling products. Its products, which are sold globally, are available in colors, performance characteristics and designs, and offer attributes, such as acoustical control, rated fire protection and aesthetic appeal. Commercial ceiling materials and accessories are sold to ceiling systems contractors and to resale distributors. Residential ceiling products are sold in North America to wholesalers and retailers, including home centers. Suspension system (grid) products manufactured by Worthington Armstrong Venture (WAVE) are sold by both the Company and WAVE.

Resilient Flooring

Resilient Flooring produces and sources a range of floor coverings for homes and commercial and institutional buildings. Manufactured products in this segment include vinyl sheet, v! inyl tile and linoleum flooring. In addition, its Resilient Flooring segment sources and sells laminate flooring products, vinyl tile products, vinyl sheet products, adhesives, and installation and maintenance materials and accessories. Resilient Flooring products are offered in a range of types, designs, and colors. It sells these products globally to wholesalers, home centers, retailers, contractors and to the manufactured homes industry.

Wood Flooring

The Company�� Wood Flooring segment produces and sources wood flooring products for use in new residential construction and renovation, with commercial applications in stores, restaurants and offices. The product offering includes pre-finished solid and engineered wood floors in various wood species, and related accessories. All of its Wood Flooring sales are in North America. Its Wood Flooring products are sold to independent wholesale flooring distributors and home centers.

The Company competes with Saint-Gobain, Chicago Metallic Corporation, Georgia-Pacific Corporation, Knauf AMF GmbH & Co. KG, Lafarge SA, Odenwald Faserplattenwerk GmbH, Rockfon A/S, USG Corporation, Amtico International, Inc., Beaulieu International Group, N.V., Boa-Franc, Inc., Congoleum Corporation, Faus, Inc., Forbo Holding AG, Gerflor Group, Interface, Inc., IVC Group, Krono Holding AG, LG Floors, Mannington Mills, Inc., Metroflor Corporation, Mullican Flooring, L.P., Mohawk Industries, Inc., Nora Systems GmbH, Pfleiderer AG, Shaw Industries, Inc., Somerset Hardwood Flooring, Tarkett AG.

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 Armstrong World Industries (NYSE: AWI  ) , whose recent revenue and earnings are plotted below.

Dividends from Berkshire? Not on Buffett's Watch

For more than 45 years, Berkshire Hathaway (BRK.B) has declined to pay dividends. A vocal group of shareholders would like that to change. But chief executive officer Warren Buffett has repeatedly expressed his views on the topic: No dice. "He feels he can earn a higher return for shareholders if he invests the company's retained earnings, rather than if the shareholders did it themselves," says David Kass, a finance professor at the Robert H. Smith School of Business at the University of Maryland in College Park.

See Also: Don't Bet Against Warren Buffett

Kass, a Berkshire shareholder who regularly attends the company's annual meeting (often with students in tow), will have a prime seat as the matter comes to a vote at this year's annual meeting, scheduled for May 3. It is virtually certain that Berkshire shareholders will reject the resolution.

Berkshire unquestionably has the means to pay a dividend. According to the 2013 annual report, about 10% of the company's assets, or $48.2 billion, is made up of cash. But the Oracle of Omaha has said he would pay a dividend only if he could not find investing opportunities that were more attractive, something that could happen if stocks became grossly overpriced. But even when the stock market reached extraordinarily high levels, as it did during the technology-fueled growth-stock boom of the late 1990s, Buffett declined to return cash to shareholders. "Part of his success in investing is his patience," Kass says.

Buffett also needs ample cash in order to make acquisitions that are large enough for Berkshire, which is one of the biggest companies in the world by market value ($311 billion as of April 16). In 2013, the company laid out nearly $18 billion to acquire a major stake in H. J. Heinz, the ketchup maker, and to purchase all of NV Energy, a Las Vegas-based utility. In 2009, Berkshire acquired railroad Burlington Northern Santa Fe in a transaction valued at $44 billion. "If he turned the cash into a dividend, Buffett wouldn't be able to find the next Burlington Northern deal," says Robert Miles, who has written three books on Buffett and Berkshire Hathaway and created a graduate-level course, "The Genius of Warren Buffett," which he teaches at the University of Nebraska-Omaha College of Business Administration.

Buffett said as much in his letter to shareholders in Berkshire's 2012 annual report: "I have made plenty of mistakes in acquisitions and will make more. Overall, however, our record is satisfactory, which means that our shareholders are far wealthier today than they would be if the funds we used for acquisitions had instead been devoted to share repurchases or dividends." Over the past ten years through April 15, Berkshire's Class B shares returned 7.2% annualized, precisely matching Standard & Poor's 500-stock index. But the company's long-term record is superb. Since Buffett took over Berkshire in 1965, the company's Class A shares have returned an astounding 20.7% annualized, more than double the return of the S&P 500. (The Class B shares were created in 1996.)

Buffett also argues that dividends are less tax-efficient than reinvesting profits in his company. That's because Uncle Sam taxes a company's profits before it pays dividends and then claims a share of the dividends unless investors hold stocks in tax-favored accounts, such as an IRA. Investors who need income, Buffett says, are better off simply selling some of their shares (assuming they've held the stock for more than a year and qualify for favorable long-term capital-gains treatment).

But Buffett may have another trick up his sleeve for returning cash to shareholders. In 2011, Berkshire's board of directors approved a plan that allows the company to buy back shares whenever the stock price falls below 120% of Berkshire's book value (assets minus liabilities). At Berkshire's current price, the stock is trading for well above book value ($89.98 per Class B share). Berkshire bought $1.3 billion worth of its shares in 2012 and none in 2013.

But if you own Berkshire stock or plan to invest in the company, don't count on getting a dividend soon. The more likely scenario is that the company will begin issuing dividends after Buffett, 83, and Berkshire vice-chairman Charlie Munger, 90, depart from the scene. "I do see a time in the future, after Buffett retires, when Berkshire will consider paying a dividend to attract and keep large institutional shareholders," Miles says. In the meantime, you'll just have to be satisfied with capital appreciation from Berkshire's stock.

Brian Rogers' T. Rowe Price Equity Income Fund First Quarter 2014 Commentary

Most U.S. equities advanced during the first quarter in a volatile session characterized by a sell-off in emerging market currencies, increased geopolitical tensions, and the transition of leadership at the Federal Reserve. Economic data were mixed, influenced by unusually cold weather across the country. Investors grew concerned about potential deflation in Europe and a larger-than-expected slowdown in the Chinese economy. Sector performance was uneven, as some areas that provided leadership in 2013 pulled back while others rose. The utilities sector was strongest, with investors seeking income-producing stocks, while health care, information technology, and financials also did well. Consumer discretionary, energy, and industrials and business services shares were laggards.

The Equity Income Fund returned 1.59% in the quarter compared with 1.81% for the S&P 500 Index and 2.04% for the Lipper Equity Income Funds Index. For the 12 months ended March 31, 2014, the fund returned 18.55% versus 21.86% for the S&P 500 Index and 18.76% for the Lipper Equity Income Funds Index. The fund's average annual total returns were 18.55%, 21.26%, and 7.52% for the 1-, 5-, and10-year periods, respectively, as of March 31, 2014. The fund's expense ratio was 0.68% as of its fiscal year ended December 31, 2012.

Sector allocations were the main deterrents to portfolio performance in the quarter, as modestly cyclical positioning detracted in a largely defensive market. The financials and information technology sectors contributed most to results, aided by good stock selection in those areas, while the consumer discretionary sector detracted due to an overweight and stock selection. An underweighting in health care was also a drag since the sector performed well. The financials sector remained the portfolio's largest exposure at more than 19% of net assets at the end of the period, followed by industrials and business services, energy, consumer discretionary, and information technology.

Stocks rallied last year on the back of an accommodative Fed policy, historically high profit margins, and an expansion of price/earnings multiples. In 2014, we expect to see more focus on company fundamentals. Economic conditions seem to be firming, and the severe weather events of the first quarter are unlikely to disrupt the recovery. Improving payroll trends, declining unemployment, and better manufacturing data provide compelling reasons to believe that the economy is on a path to modest growth through the year. We expect stocks to provide more moderate returns this year than they did in 2013. Corporate earnings growth is good, and we believe companies will continue to buy back shares and increase dividends. We will remain diligent in our search for the best investment ideas, while not sacrificing our valuation discipline.

Also check out: Brian Rogers Undervalued Stocks Brian Rogers Top Growth Companies Brian Rogers High Yield stocks, and Stocks that Brian Rogers keeps buying

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Stocks to Watch: Citigroup, JA Solar, Chindex

Among the companies with shares expected to actively trade in Monday’s session are Citigroup Inc.(C), JA Solar Holdings(JASO) Co and Chindex International Inc.(CHDX)

Citigroup said its first-quarter profit rose 3.5% from a year earlier as the bank benefited from lower expenses and provisions for soured loans, overshadowing weakness at its fixed-income unit. Shares jumped 4% to $47.50 in premarket trading as results comfortably beat the estimates of analysts polled by Thomson Reuters.

JA Solar raised its first-quarter solar cell and module shipments estimate, a move Chief Executive Baofang Jin attributed to solid execution. The solar-products company’s shares rose 5.2% to $9.80 in recent premarket trading.

Chindex said it had received a bigger acquisition offer than the one it received from a consortium led by private-equity firm TPG Inc. Chindex–a U.S. company that provides health-care services in China through the United Family Healthcare network–didn’t identify the new bidder. Shares rose 17% to $22.90 in recent premarket trading.

Acorda Therapeutics Inc.(ACOR) said Monday that its Phase 3 study of its dalfampridine-QD treatment in people with post-stroke walking deficits will start later than originally expected. Shares of the biotechnology company fell 3.4% to $34 in premarket trading.

Trina Solar Ltd.(TSL) lowered its solar module shipment guidance for the first quarter, citing a temporary decrease in shipments to the European Union. The Chinese solar panel maker also boosted its gross margin expectations for the quarter. Shares dropped 1.8% to $11.35 premarket.

Fitch Ratings downgraded its rating on Alcoa Inc.(AA) into junk territory, citing financial strains including weak aluminum prices.

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Vornado Realty Trust sa(VNO)id its board of trustees has approved a plan to spin off the commercial property owner’s shopping center business into a new publicly traded real-estate investment trust.

Yahoo Inc.(YHOO) said Tribune Co. Chief Executive Peter Liguori won’t seek re-election to the Internet giant’s board of directors. Yahoo didn’t provide a reason in a Securities and Exchange Commission filing.

Expedia Is in Search of Europe's Growth

Expedia Inc. (EXPE) is one of the world's largest online travel services companies. Businesses include Expedia, Hotels.com and Hotwire. In December 2011, Expedia spun off TripAdvisor (TRIP) as a publicly traded company.

In this article, let's take a look at this company and try to explain to investors the reasons this is an apparently appealing investment.

Successful Models and Technology Platform

Models developed by management help to study customer behavior as a predictor of future behavior and spending patterns with the aim to increase the choices offered to consumers. The wealth of choices helps attract more customers, which in turn generates revenue growth and margin expansion.

Due to the rapid increase in its international regions, the firm is in process of transitioning Expedia brands to a new global technology platform.

China and Asia Have Become a Priority

In June 2008, EXPE acquired Italy's Venere, with a focus on European lodging reservations, and this has aided the company's international operations. This was followed by the acquisition of German metasearch company Trivago.

In May 2010, the company completed multiple transactions to materially increase its economic stake in eLONG, one of the largest online travel companies in China. The following year, it took further actions to increase its interest on it.

In March 2011, the firm announced a joint venture with AirAsia, a leading low-cost airline in Asia, to better pursue growth opportunities. Also it acquired a local Vietnamese ecommerce company (PeaceSoft).

Finally, on March 2013, it acquired 62% of Europe an hotel search company trivago, in a deal valued at $632 million in cash and stock.

Marketing Campaigns

Expedia develop a strong marketing campaign to establish the brand in Europe. It is currently in the middle of a major campaign that includes TV, online and social media ads.

Analyst Recommendation

The firm is currently Zacks Rank # 3–Hold, and it also has a longer-term recommendation of "Neutral". A Hold rating indicates that the stock, over the next 1 to 3 months, will perform at an annualized rate of 10.56%, very similar to the S&P 500. For investors looking for a better Zacks Rank, Bitauto Holdings Limited (BITA), E-Commerce China Dangdang Inc. (DANG) and Vipshop Holdings Limited (VIPS) could be better options.

Top 10 Communications Equipment Stocks To Watch Right Now

Relative Valuation, Earnings and ROE

In terms of valuation, the stock sells at a trailing P/E of 43.1x, trading at a premium compared to the industry mean. Earnings per share (EPS) has increased in the most recent quarter compared to the same quarter a year ago, $0.7 per share for the fourth quarter. In the next graph we include the stock price because EPS often lead the stock price movement. As we can appreciate in the chart, the price performance had an upward trend over the last five years.

Finally, I always like to see one of the most important financial ratios applying to stockholders, the best measure of performance for a firm's management: the return on equity. The ratio has decreased from the same quarter one year prior. This is a clear sign of weakness within the company.

Let´s compare the current ratio with the peer group in the next table:

Ticker	Company Name	ROE (%)
EXPE	Expedia	10.85
BITA	Bitauto Holdings	13.68
DANG	E-Commerce China Dangdang	-60.02
VIPS	Vipshop Holdings Limited	-11.47
ASUR	Asure Software, Inc.	-39.41
MWW	Monster Worldwide, Inc.	-0.06
CTRP	Ctrip.com International, Ltd.	11.70

The company has a current ratio of 10.85% which is higher than the ones registered by E-Commerce China Dangdang, Vipshop Holdings Limited, Asure Software, Inc. and Monster Worldwide, Inc. But for investors looking for a higher ROE, Bitauto Holdings and Ctrip.com International, Ltd. (CTRP) could be better options.

Final Comment

Models to better understand the behavior of its customer base and acquisitions to increase inventory all over Europe are catalyst for the online travel company as well as it marketing campaign in that continent. For these reasons, I feel bullish on Expedia.

I would recommend investors to consider adding the stock for their long-term portfolios. Hedge fund gurus have also been active in the company in the fourth quarter of 2013. Gurus like Mario Gabelli (Trades, Portfolio), Jim Simons (Trades, Portfolio), Louis Moore Bacon (Trades, Portfolio) and Caxton Associates (Trades, Portfolio) have taken long positions on it.

Disclosure: Victor Selva holds no position in any stocks mentioned.

Also check out: Caxton Associates Undervalued Stocks Caxton Associates Top Growth Companies Caxton Associates High Yield stocks, and Stocks that Caxton Associates keeps buying Jim Simons Undervalued Stocks Jim Simons Top Growth Companies Jim Simons High Yield stocks, and Stocks that Jim Simons keeps buying

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