Hot US Stocks To Buy Right Now

Hot US Stocks To Buy Right Now: Aon Corporation(AON)

Aon Corporation provides risk management services, insurance and reinsurance brokerage, and human resource consulting and outsourcing services primarily in the United States, the Americas, the United Kingdom, Europe, the Middle East, Africa, and the Asia Pacific. The company?s Risk Solutions segment offers retail brokerage products and services, including affinity products, general underwriting management services, placement services, and captive management services; and advisory services to technology, financial services, agribusiness, aviation, construction, health care, and energy industries, as well as facilitates various risk management solutions for property liability, general liability, professional liability, directors' and officers' liability, workers' compensation, and various healthcare products. This segment also provides risk consulting services comprising captive management; eSolutions products that enable clients to manage risks, policies, claims, and safet y concerns through an integrated technology platform; reinsurance brokerage services, such as actuarial, enterprise risk management, catastrophe management, and rating agency advisory services; property and casualty reinsurance; and specialty lines, which include professional liability, medical malpractice, accident, life, and health, as well as capital management transaction and advisory services. Its HR Solutions segment offers human capital services in the areas of health and benefits, retirement, compensation, and strategic human capital; and benefits administration and human resource business process outsourcing services. The company was founded in 1919 and is headquartered in Chicago, Illinois.

Advisors' Opinion:

• [By Reuters]

  Wendy Maeda/The Boston Globe via Getty Images NEW YORK -- Walgreen is moving 120,000 employees to a private health insurance exchange from coverage provided directly from carriers, the company will announc! e Wednesday. The pharmacy chain will join 17 other large employers on the Aon Hewitt Corporate Health Exchange as part of a growing movement to offer employees fixed dollar amounts to purchase their own plans on such exchanges. The end-cost to employees depends on the plan chosen, but they typically get more options than under traditional arrangements. Private exchanges mimic the coverage mandated as part of the Affordable Care Act. Enrollment in the public exchanges starts Oct. 1. "What happens to employer contributions over time? Will they put in as much as they put in the past? These are unanswered questions but potential negatives," says Paul Fronstin, a senior research associate with the Employee Benefit Research Institute. The benefit to Walgreen and other employers is unknown at this point, as their cost-savings aren't clear. Of the 180,000 Walgreen (WAG) employees eligible for health care insurance, 120,000 opted for coverage for themselves and 40,000 family members. Another 60,000 employees, many of them working part-time, weren't eligible for health insurance. Aon Hewitt (AON) says other participants in its program include retailer Sears Holding (SHLD) and Darden Restaurants (DRI). These new additions raise enrollment to 330,000 from 100,000 last year, and Aon Hewitt estimates enrollment will jump to 600,000 next year, a fivefold increase from 2012. By 2017, nearly 20 percent of employees nationwide could get their health insurance through a private exchange, according to Accenture Research (ACN). A recent report by the National Business Group on Health said that 30 percent of large employers are considering moving active employees to exchanges by 2015. Other major providers of private exchanges include Mercer, a division of Marsh & Mc

• [By Holly LaFon]

  Company Dell Inc. (DELL) Chesapeake Energy (CHK) DirecTV (DTV) Loews (L) Walt Disney (DIS) Aon Plc (AON) The Travelers Companies (TRV) Level 3 Communications (LVLT) FedEx (FDX) Bank of New York Mellon (BK) Learn m! ore about Mason and his views on the present economy in his second-quarter letter here. See his portfolio here.

• [By Keith Speights]

  AON Hewitt, the human resources business unit of AON (NYSE: AON  ) , successfully enrolled more than 100,000 employees across the U.S. in health insurance plans last fall through its Corporate Health Exchange product. The company's survey of enrollees found that nearly 80% "felt confident they chose the health plan that offered the best value for them and their family." 93% liked being able to choose from multiple insurance carriers.

source from Top Penny Stocks For 2015:http://www.seekpennystocks.com/hot-us-stocks-to-buy-right-now.html

Top 5 Managed Healthcare Stocks To Invest In 2015

Top 5 Managed Healthcare Stocks To Invest In 2015: American States Water Co (AWR)

American States Water Company (AWR), incorporated on February 25, 1998, is the parent company of Golden State Water Company (GSWC) and American States Utility Services, Inc. (ASUS) and its subsidiaries (Fort Bliss Water Services Company (FBWS), Terrapin Utility Services, Inc. (TUS), Old Dominion Utility Services, Inc. (ODUS), Palmetto State Utility Services, Inc. (PSUS) and Old North Utility Services, Inc. (ONUS)). AWR operates in three segments: water, electric and contracted services. Within the segments, AWR has two principal business units, water and electric service utility operations, conducted through GSWC, and contracted services conducted through ASUS and its subsidiaries.

GSWC is a California public utility company engaged principally in the purchase, production and distribution of water in 75 communities in 10 counties in the State of California. GSWC also provides electric service to the City of Big Bear Lake and surrounding areas in San Bernardino County, California through its Bear Valley Electric Service (BVES) division. GSWC served 255,657 water customers and 23,379 electric customers as of December 31, 2012. ASUS, through its wholly owned subsidiaries, has contracted with the United States government to provide water and/or wastewater services at various military installations, including the operation, maintenance, renewal and replacement of the water and/or wastewater systems, pursuant to 50-year firm, fixed-price contracts. As of December 31, 2012, GSWC's physical properties consisted of water transmission and distribution systems which included 2,786 miles of pipeline together with services, meters and fire hydrants and approximately 425 parcels of land.

As of December 31, 2012, GSWC owned 244 wells, of which 188 are active operable wells equipped with pumps with ! an aggregate production capacity of approximately 202.7 million gallons per day. GSWC has 63 connections to the water distribution fa cilities of the Metropolitan Water District of Southern Cali! fornia (MWD), and other municipal water agencies. GSWC's storage reservoirs and tanks have an aggregate capacity of approximately 111 million gallons. GSWC owns no dams. GSWC's electric properties are located in the Big Bear area of San Bernardino County, California. As of December 31, 2012, GSWC owned and operated 29.6 miles of overhead 34.5 kilovolt transmission lines, 1.4 mile of underground 34.5 kilovolt transmission lines, 179.6 miles of 4.16 kilovolt or 2.4 kilovolt distribution lines, 53.2 miles of underground cable, 13 sub-stations and a natural gas-fueled 8.4 megawatt peaking generation facility. GSWC also has franchises, easements and other rights of way for the purpose of constructing and using poles, wires and other appurtenances for transmitting electricity.

Advisors' Opinion:

• [By Richard Band]

  American States Water (AWR) provides water service to one of 36 Californians throughout the northern, coastal and southern regions of the state.

  In their recent earnings report, AWR showed an 11.1% increase in diluted earnings per share, but revenues fell short of analyst estimates by 2% due to an increase in the effective income tax rate for the company’s water segment.

• [By MONEYMORNING]

  American States Water Co. (NYSE: AWR) is one of the best examples I can think of. Its current payout of 2.88% may not seem like much when compared to the likes of a Kinder Morgan Energy Partners LP (NYSE: KMP) at 6.5%, but when you consider that AWR has increased its dividend for the last 59 years, you begin to understand why this is pivotal to building your wealth, especially now.

• [By MONEYMORNING]

  If you're buying a stock for income, note that, along with how much money you expect it to kick off. That way you can look! back yea! rs from now and really appreciate something like an American States Water (NYSE: AWR) pick, which has increased its dividend for 59 years.

source from Top Stocks For 2015:http://www.topstocksblog.com/top-5-managed-healthcare-stocks-to-invest-in-2015.html

Hot Asian Stocks To Watch Right Now

Hot Asian Stocks To Watch Right Now: CVR Partners LP(UAN)

CVR Partners, LP engages in the production of nitrogen fertilizers including ammonia and urea ammonium nitrate. The company was incorporated in 2007 and is based in Sugar Land, Texas. CVR Partners, LP operates as a subsidiary of CVR Energy, Inc.

Advisors' Opinion:

• [By Susan J. Aluise]

  CVI is structured into two Managed Limited Partnerships (MLPs): CVR Refining (CVRR) and the nitrogen fertilizer unit CVR Partners (UAN). CVR Energy owns 71% of CVR Refining and 53% of CVR Partners. This is an interesting play in the energy sector, given UAN's lower cost of ammonia and urea ammonium nitrate and CVRR's edge as an MLP refiner.

• [By Robert Rapier]

  4. CVR Partners

  CVR Partners (NYSE: UAN) is a fertilizer MLP that suffered from the same declining margins and weak fertilizer prices that hurt Rentech Nitrogen Partners. The partnership’s price declined 36 percent in 2013. The annualized yield based on the past four quarters of distributions is 11.7 percent, but that is expected to decline when the next distribution is announced.
  

  5. Terra Nitrogen Company

source from Top Stocks For 2015:http://www.topstocksblog.com/hot-asian-stocks-to-watch-right-now.html

Hot Retail Stocks To Watch Right Now

Hot Retail Stocks To Watch Right Now: Shoe Carnival Inc (SCVL)

Shoe Carnival, Inc. is a family footwear retailer. The Company offers customers an assortment of dress, casual and athletic footwear for men, women and children with emphasis on national and regional name brands. The Companys stores averaged approximately 10,800 square feet, ranging in size from 6,000 to 26,500 square feet. As of January 28, 2012, the Company operated 327 stores located across 32 states and offered online shopping at www.shoecarnival.com. Its average store carries approximately 28,500 pairs of shoes in four general categories, such as mens, womens, childrens and athletics. In addition to footwear, its stores carry selected accessory items complementary to the sale of footwear.

The Company operates a single 410,000 square foot distribution center located in Evansville, Indiana. Womens, mens and childrens non-athletic footwear categories are further divided into dress, casual, sport, sandals and boots. It classifies athletic shoes by functionality, such as running, basketball or fitness shoes. During the fiscal year ended January 28, 2012 (fiscal 2011), athletic styles, including childrens sizes, have represented approximately 50% of its footwear sales.

Advisors' Opinion:

• [By Jeremy Bowman]

  What: Shares of Shoe Carnival (NASDAQ: SCVL  ) were partying on Friday, gaining as much as 10% after reporting a strong first quarter.

  So what: The shoe-selling chain turned in a per-share profit of $0.47, $0.07 ahead of the analyst consensus, while revenue crept up 4.3% thanks to an 8% increase in store count over the year. Same-store sales, however, decreased 0.8%, perhaps indicating organic weakness in the retailer. CEO Cliff Sifford noted "the colder, wetter weather" made the quarter "challenging," as many other retailers have said this season. Better weather in April improved the sales trajectory and helped the compan! y beat expectations. Its outlook for the current quarter was in line with estimates with an EPS of $0.26-$0.30 and same-stores increasing 3-5%.

• [By Lauren Pollock]

  Shoe Carnival Inc.'s(SCVL) fiscal third-quarter earnings slid 11%, with revenue declining due to an unfavorable calendar shift from the previous year.

• [By Laura Brodbeck]

  Monday

  Earnings Releases Expected: FedEx Corporation (NYSE: FDX), Goldmans Stores, Inc. (NASDAQ: GMAN), Thor Industries, Inc. (NYSE, THO), Krispy Kreme Doughnuts, Inc. (NYSE: KKD), Shoe Carnival, Inc. (NASDAQ: SCVL) Economic Releases Expected: Spanish manufacturing PMI, French manufacturing PMI, German manufacturing PMI, eurozone manufacturing PMI, British manufacturing PMI, US ISM manufacturing PMI, Reserve Bank of Australia interest rate decision.

  Tuesday

source from Top Penny Stocks For 2015:http://www.seekpennystocks.com/hot-retail-stocks-to-watch-right-now.html

Whole Foods Market, Inc. (WFM): Insider Buy Might Be Early, But Right?

Insiders picked up the pace of buying last week as the number of companies reporting purchases moved north of 200 for the first time in at least a month. Hopefully, the uptick means boardroom confidence for the economy's prospects are on the upswing for the back half of 2014 – fingers crossed for the millions that have given up on finding a job.

While, unfortunately, many good people are losing hope for finding rewarding work, at least one insider at Whole Foods Market, Inc. (NASDAQ:WFM) hasn't given up on the "organic" grocer despite hitting an earnings-driven rough patch.

Whole Foods is a retailer of natural and organic foods. The Company operates in one segment: natural and organic foods supermarkets. As of May 6, 2014, the company operated 374 stores in the United States, Canada, and the United Kingdom.

[Related -Whole Foods Market, Inc. (WFM): Stock Set For Multiple Expansion]

Director, William Tindell purchased 13,256 shares of WFM at $39.41 for a total investment of $522,418. His buy comes on the heels of the stock getting cracked by investors following disappointing profit news. The stock price tumbled from $47.95 one day and $38.93 the next.

What makes the buy interesting is that the Director's only other open market activity was to sell $387,532 of Whole Foods in August 2013. The sale at $55.68 was a bit early as WFM topped out a little more than two months later. It's been mostly downhill since.

Tindell could be early this time around, too, but his previous history of "getting right" has to encourage Whole Foods bulls. If only others would open checkbook, as well.

[Related -Whole Foods Market, Inc. (WFM): 4 Reasons Hedge Fund Billionaires Are Wrong About 62% Gain]

Despite missing the consensus estimate two straight quarters, analysts believe EPS will be up 13% next year on sales growth of 12.70%. Those are solid growth rates and higher than 2014 expectations. The consensus for 2015's top-line is $16.11 billion with a projected $1.74 making it to the bottom line.

The stock will be much higher if Whole Foods trades at its average price-to-sales (P/S) and price-to-earnings (P/) ratios for the last half-decade. Since 2009, investors typically paid 1.12 times sales and 35.42 times earnings.

If WFM trades at its norms based on 2015 consensus sales and EPS outlooks, then shares would price out at $48.58 and $61.63 using the five-year average P/S and P/E ratios, respectively. Tindell might be content with either.

Overall: Whole Foods Market, Inc. (NASDAQ:WFM) offers considerable upside based on its recent P/S and P/E with 2015's projected sales and profits. William Tindell might be early again, but could be looking good in within the next 12-to18 months. 

Best Healthcare Equipment Stocks To Watch For 2015

Best Healthcare Equipment Stocks To Watch For 2015: Furiex Pharmaceuticals Inc (FURX)

Furiex Pharmaceuticals, Inc. is a drug development collaboration company. The Company's product pipeline includes two marketed products and three programs in development, including late-stage compounds, in multiple therapeutic areas. Its programs include Priligy, Alogliptin Nesina, Alogliptin/Actose Combination, Alogliptin/Metformin Combination, Fluoroquinolone, Mu Delta and PPD 10558. In November 2011, it acquired full exclusive license rights to develop and commercialize the compound MuDelta under its existing development and license agreement with Janssen Pharmaceutica N.V.

Priligy (dapoxetine) is a drug developed for the on-demand treatment of premature ejaculation (PE). Dapoxetine is a short-acting, selective serotonin reuptake inhibitor (SSRI) designed to be taken only when needed one to three hours before sexual intercourse is anticipated rather than every day. Nesina (alogliptin) is a drug for the oral treatment of type 2 diabetes (T2D). Alogliptin is a DPP-4 inhibitor that slows the inactivation of incretin hormones glucagon-like peptide-1 (GLP-1) and glucose-dependent insulinotropic peptide (GIP).

Fluoroquinolone drug candidate is a Phase II-ready novel fluoroquinolone antibiotic that is being developed by the Company for the treatment of complicated skin and skin structure infections, such as abscesses that occur deep in the skin layers and respiratory infections. This antibiotic has a spectrum of activity and is able to treat methicillin-resistant staphylococcus aureus (MRSA) infections. The Company is developing both oral and intravenous (IV) formulations. The Company is developing Mu Delta for treatment of diarrheal predominant irritable bowel syndrome (d-IBS). The Company is conducting a Phase II study on an oral formulation of Mu Delta.

The Company is! developing PPD 10558 for the treatment of dyslipidemia. PPD 10558 has shown muscle safety in preclinical studies by minimizing the deliv ery of the drug to the muscle. The Company has filed an inve! stigational new drug (IND) application with the United States Food and Drug Association and completed five clinical studies.

Advisors' Opinion:

• [By Jake L'Ecuyer]

  Top Headline
  Forest Laboratories (NYSE: FRX) announced its plans to buy Furiex Pharmaceuticals (NASDAQ: FURX) for up to $1.46 billion. Forest will pay around $95 per share, or around $1.1 billion in cash. Forest Labs will also pay up to $30 per share, or around $360 million in a contingent value right. The deal is projected to close in the second or third quarter of 2014.

• [By Jake L'Ecuyer]

  Top Headline
  Forest Laboratories (NYSE: FRX) announced its plans to buy Furiex Pharmaceuticals (NASDAQ: FURX) for up to $1.46 billion. Forest will pay around $95 per share, or around $1.1 billion in cash. Forest Labs will also pay up to $30 per share, or around $360 million in a contingent value right. The deal is projected to close in the second or third quarter of 2014.

source from Top Stocks Blog:http://www.topstocksblog.com/best-healthcare-equipment-stocks-to-watch-for-2015.html

Small business on-the-go? Smartphones can help

NEW YORK — Avi Shenkar runs his four hair salons from the palm of his hand.

Work for the owner of Blo/Out Blow Dry Bars begins as soon as he grabs his iPhone at 6 a.m. while still in bed. He scrolls through messages on group texting app GroupMe to see if any of his stylists are running late or need the day off. He pumps pop and electronic dance music through the wireless speakers in his stores using an app for Sonos, a brand of wireless speakers. And he can see what's going on in each location by watching video on his phone from cameras with the Samsung iPolis app, a video camera security system.

"The phone is always with me," says Shenkar, whose salons do blowouts for $35. "It's an extension of me."

Smartphones have become vital for on-the-go entrepreneurs. Apps aimed at small business owners allow them to pay bills, update websites, market their companies, reach out to customers and keep in touch with employees from anywhere. Some owners say their smartphones makes it easier for them to build a side business while keeping a full-time job or step away from the company when needed.

GETTING HELP: Partnership helped small lingerie business grow

They're also a big help for store owners, like Shenkar, who can't be at every location at once.

"Typically, I drive from one store to another," says Shenkar, who has three stores in Philadelphia and one in Atlantic City, which is only open in the spring and summer months.

Last year, he dropped his iPhone and shattered it before a drive to the Atlantic City shop.

"I had to immediately rush over to the Apple Store," he says. "I didn't care what the price was, I just got it."

Noah Chaimberg is also attached to his smartphone. He started Heatonist.com, a website that sells specialty hot sauces, in November. He still works a full-time marketing job in New York and relies on his iPhone to keep him connected to his business.

An app from online store creator Bigcommerce alerts him when an order is made on Heatoni! st.com. He pays suppliers using an app from payment processor PayPal. He also frequently uploads photos of hot sauce bottles to photo-sharing app Instagram, which helps him attract new customers.

When he goes to food festivals to sell carrot curry or red chili lime hot sauces, he turns his iPhone into a cash register with Square, a small device the size of a quarter that plugs into his phone and lets customers buy the sauces with their debit or credit cards.

"I'm constantly on the go," Chaimberg says.

Some entrepreneurs don't even have to be in the same state to run their business.

Kimberly Davison, who co-owns women's clothing store Goodbuy Girls in Nashville , moved to Los Angeles in April to earn some extra cash as a freelance marketing consultant to pay off a $10,000 dentist bill. She also wanted "to have fun" after running the store for nearly five years. Her co-owner, who drops by the shop a few days a week, was skeptical about the move, Davison says, but the arrangement is working.

Davison updates the stores website with an app from website and blog publishing platform WordPress on her Nokia Lumia smartphone. She gives out a Google Voice phone number to customers so that they can text her if they want to order a T-shirt or a vintage pair of cowboy boots. She uses Google's calendar to schedule employee work hours and special events, like if a country artist plans to stop by for a fitting. And she uses Instagram to post photos of new items she finds after meeting with clothing wholesalers in Los Angeles.

Often, customers ask to buy clothing straight from Instagram. That's when she'll respond with a link to the store's PayPal account to pay for the clothing.

"I literally do this sitting on the beach sometimes," says Davison. "It's crazy."

Top Machinery Companies For 2015

There is no joy in Joy Global (JOY).

Agence France-Presse/Getty Images

Shares of Joy Global, which competes with the likes of Caterpillar (CAT), Terex (TEX) and Deere (DE), have plunged today after the machinery maker announced disappointing earnings and guidance.

The Wall Street Journal has the details on Joy Global’s earnings and guidance:

Joy expects full-year per-share earnings of $3 to $3.50 on revenue of $3.6 billion and $3.8 billion. Analysts polled by Thomson Reuters recently expected full-year earnings of $3.68 a share on $3.8 billion in revenue.

For the quarter ended Oct. 25, Joy Global reported a profit of $26.8 million, or 25 cents a share, down from $212.6 million, or $1.99 a share, last year. Excluding unusual items, per-share earnings fell to $1.11 from $2.10.

Sales also dropped 35% to $1.18 billion.

Top Machinery Companies For 2015: Buhler Industries Inc (BIIAF.PK)

Buhler Industries Inc. is a manufacturer of a range of agricultural equipment marketed throughout North America under three primary brand names Versatile, Allied, and Farm King. The Company�� principal products are tractors, self-propelled and pull-type sprayers, frontend loaders, grain augers, snow blowers, tillers, finishing mowers, feed processing equipment, seeding and tillage equipment and hay and forage equipment. The Company�� factories include the Winnipeg (Clarence) factory, the Morden, Manitoba factory, the Winnipeg (Regent) factory, the Bradley Steel Processors��factory, the Fargo factory, the Salem factory, the Willmar factory and the Vegreville factory. The Company�� subsidiaries include John Buhler Inc., Progressive Manufacturing Ltd., Amarillo Service & Supply Inc., Haskett Properties Inc., Buhler Versatile Inc, Haskett Investments Ltd., Buhler Finance Inc. and Buhler Ezee-On, Inc. Advisors' Opinion:

• [By Seth Barkett]

  Buhler Industries Inc. (BIIAF.PK) is headquartered in Winnipeg, Manitoba, Canada. The company was established in 1932 as an agricultural equipment manufacturer. It was purchased by John Buhler in 1969 and in 2007, Combine Factory Rostselmash Ltd. acquired 80% of the company's stock. Through steady expansion, new products and distribution channels, and acquisitions, Buhler has experienced impressive growth. With seven manufacturing plants across Canada and the United States as well as a great collection of brands like Farm King, Allied, Inland, and Versatile, this vertically-integrated manufacturer is an excellent way to invest in the global agricultural boom.

Top Machinery Companies For 2015: Rockwell Automation Inc.(ROK)

Rockwell Automation, Inc. provides industrial automation power, control, and information solutions. It operates in two segments, Architecture and Software, and Control Products and Solutions. The Architecture and Software segment offers control platforms that perform multiple control disciplines and monitoring of applications, including discrete, batch and continuous process, drives control, motion control, and machine safety control; and products comprising controllers, electronic operator interface devices, electronic input/output devices, communication and networking products, and industrial computers. This segment also offers software products, such as configuration and visualization software used to operate and supervise control platforms, advanced process control software, and manufacturing execution software to enhance manufacturing productivity and meet regulatory requirements; and rotary and linear motion control products, and sensors and machine safety components . The Control Products and Solutions segment provides low and medium voltage electro-mechanical and electronic motor starters, motor and circuit protection devices, AC/DC variable frequency drives, push buttons, signaling devices, termination and protection devices, relays and timers, and condition sensors; and packaged solutions, such as configured drives and motor control centers to automation and information solutions, as well as life-cycle support services. The company sells its products, solutions, and services primarily under the Rockwell Automation, Allen-Bradley, A-B, and Rockwell Software brand names to the food and beverage, transportation, oil and gas, metals, mining, home and personal care, pulp and paper, and life sciences markets through independent distributors and direct sales force in the United States, Canada, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. Rockwell Automation, Inc. was founded in 1928 and is headquartered in Milwaukee , Wisconsin.

Advisors' Opinion:

• [By David Sterman]

  So which companies are likely to most greatly benefit from an eventual rise in capital spending? Firms involved in construction, business process automation, and other productivity tools. Here's a short sample, though you should keep an eye out for any companies that have a high level of sensitivity to changes in capital spending levels.

  1. Rockwell Automation (NYSE: ROK) This maker of factory automation systems has managed to boost sales less than 10% from fiscal 2008 to fiscal 2012. Yet management hasn't been waiting around for business to improve. In that time, Rockwell has been investing hundreds of millions in its Logix Automation control platform, an open-source software system that enables all components of a production process control system to easily interoperate. Moreover, Rockwell's core strength in manufacturing has now been extended into the fields of energy refineries, mining, and food and beverage production.

   

Top 10 Consumer Stocks To Invest In 2015: Renishaw PLC (RSW)

Renishaw plc is a metrology company. The Company is engaged in the design, manufacture and sale of advanced precision metrology and inspection equipment together with products for the healthcare sector, including Raman spectroscopy systems, dental systems, molecular diagnostic equipment and neurosurgical products. The Company operates in two segments: metrology and healthcare products. The Company�� metrology segment product include Machine Tool Probe Systems, Co-ordinate Measuring Machine (CMM) products, large scale metrology, fixtures, materials research, styli for probe systems, performance testing products, gauging and position encoders. Its healthcare products include Dental Scanners, Raman Microscopes, Dental CAD Software, Neurosurgical robot, Structural and Chemical Analyser, In situ monitors and Neurosurgical Implantables. Advisors' Opinion:

• [By Inyoung Hwang]

  Renishaw Plc (RSW) tumbled 5.7 percent to 1,580 pence, its lowest price since Aug. 7. The maker of precision tools said revenue for the quarter ended in September fell to 79 million pounds from 95.9 million pounds in the year-ago period.

Top Machinery Companies For 2015: Colfax Corp (CFX)

Colfax Corporation (Colfax) is a global industrial manufacturing and engineering company. The Company provides gas- and fluid-handling and fabrication technology products and services to commercial and governmental customers worldwide under the Howden and ESAB brand names and by Colfax Fluid Handling. Colfax�� products are marketed principally under the brand names Allweiler, Baric, Fairmount Automation, Houttuin, Imo, LSC, COT-Puritech, Portland Valve, Tushaco, Warren and Zenith. The Company has production facilities in Europe, North America and Asia. It offers customized fluid handling solutions to meet individual customer needs. In February 2011, the Company acquired Rosscor Holding B.V. In December 2011, it acquired COT-PURITECH. On January 13, 2012, Colfax acquired Charter International plc. In May 2012, the Company acquired 91% interest in Soldex S.A.

Pumps

Colfax manufactures rotary positive displacement pumps. Its rotary positive displacement pumps consist of a casing containing screws, gears, vanes or similar components that are actuated by the relative rotation of that component to the casing, which results in the physical movement of the liquid from the inlet to the discharge at a constant rate.

Fluid Handling Systems

The Company manufactures fluid handling systems used primarily in the oil and gas, power generation, commercial marine and global defense markets. Colfax offers turnkey systems and support, including design, manufacture, installation, commission and service. Its systems include lubrication systems, which are used in rotating equipment in oil refineries and other process industries; custom designed packages used in crude oil pipeline applications; lubrication and fuel forwarding systems used in power generation turbines; packages for commercial marine engine rooms, and fire suppression systems for navy applications. Howden�� primary products are heavy-duty fans, rotary heat exchangers and compressors. The fans and heat! exchangers are used in coal-fired power stations, both in combustion and emissions control applications, underground mines, steel sintering plants and other industrial facilities. It design, manufacture and distribute fluid-handling products that transfer or control liquids in a range of applications.

Specialty Valves

The Company�� specialty valves are used primarily in naval applications. Its valve business has specialized machining, welding and fabrication capabilities that enable the Company to serve as a contractor to the United States Navy. In addition to designing and manufacturing valves, Colfax also offers repair and retrofit services for products manufactured by other valve suppliers through its aftermarket support centers located in Portland, Maine and San Diego, California.

Advisors' Opinion:

• [By Holly LaFon]

  In the fourth quarter, he bought 32 new stocks. The largest new buys are: Air Lease (AL), Colfax (CFX) and Republic Bancorp Inc. (RBCAA).

  Air Lease (AL)

• [By GuruFocus]

  George Soros (Trades, Portfolio) just reported his first quarter portfolio. He buys Citrix Systems Inc, Baker Hughes Inc, Comcast Corp, Spansion Inc, etc during the 3-months ended 03/31/2014, according to the most recent filings of his investment company, Soros Fund Management LLC. As of 03/31/2014, Soros Fund Management LLC owns 305 stocks with a total value of $10.1 billion. These are the details of the buys and sells.New Purchases: BHI, CODE, CTRP, CLI, AVB, COMM, CNQ, AGO, AUY, ATML, ASH, BXMT, CSTM, AEM, CMA, ARE, CHKP, AUQ, BEAV, CX, ADSK, AALCP, BLK, AIG, BIIB, ADEP, AMRI, ARWR, ATHX, BALT, BCRX, BEAT, CFX, CLFD, CUR, CODE,Added Positions: CTXS, CMCSA, CNP, ALTR, BRCD, CBS, CRM, CHTR, CCJ, CIEN, BIDU, ALLE, ABT, CDNS, ACT,Reduced Positions: AAPL, CCI, AMT, ABBV, AAL, BITA, AL, ANGI, ARIA, CBST, BA, BIRT, EXAR,Sold Out: C, BAC, CRI, AMZN, AGN, CF, BRCM, COTY, BMY, AMCX, CAR, A, ADBE, AFL,For the details of George Soros (Trades, Portfolio)'s stock buys and sells, go to http://www.gurufocus.com/StockBuy.php?GuruName=George+SorosThis is the sector weightings of his portfolio:Technology18.9%Energy14%Healthcare8.3%Consumer Defensive8.2%Communication Services8.1%Consumer Cyclical5.4%Industrials5.1%Basic Materials4.9%Financial Services2.5%Real Estate1.9%Utilities0.5%These are the top 5 holdings of George Soros (Trades, Portfolio)1. Teva Pharmaceutical Industries Ltd (TEVA) - 10,310,041 shares, 5.4% of the total portfolio. Shares added by 10.67%2. Herbalife Ltd (HLF) - 4,901,337 shares, 2.8% of the total portfolio. Shares added by 52.9%3. EQT Corp (EQT) - 2,573,814 shares, 2.5% of the total portfolio. Shares added by 3.27%4. Adecoagro SA (AGRO) - 25,915,076 shares, 2.1% of the total portfolio.5. Halliburton Co (HAL) - 3,596,353 shares, 2.1% of the total portfolio. Shares reduced by 20.73%New Purchase: Baker Hughes Inc (BHI)George Soros (Trades, Portfolio) initiated holdings in Baker Hughes Inc. His purchase prices were between $51.82 and $65.27, with an estimated

Top Machinery Companies For 2015: Kadant Inc (KAI)

Kadant Inc., incorporated in November 1991, is a supplier of equipment used in the global papermaking and paper recycling industries and a manufacturer of granules made from papermaking byproducts. Through its Papermaking Systems segment, the Company develops, manufactures and markets a range of equipment and products for the global papermaking, paper recycling, and process industries. Through its Fiber-based Products business, the Company manufacture and sell granules derived from pulp fiber for use as carriers for agricultural, home lawn and garden, and professional lawn, turf and ornamental applications, as well as for oil and grease absorption. Its Papermaking Systems segment consists of product lines, such as stock-preparation, fluid-handling, doctoring and water-management. On May 27, 2011, its subsidiary, Kadant Johnson Europe B.V., acquired all the interests in m-clean papertech holding AB. In April 2013, it completed the acquisition of Companhia Brasileira de Tecnologia Industrial (CBTI).

The Company�� customer base includes major global paper manufacturers and with its equipment found in most of pulp and paper mills. The Company manufactures its products in nine countries in Europe, North and South America and Asia. It develop, manufacture and market complete custom-engineered systems and equipment, as well as standard individual components, for pulping, de-inking, screening, cleaning, and refining recycled and virgin fibers for preparation for entry into the paper machine. Its principal stock-preparation products include recycling and approach flow systems and Virgin pulping process equipment.

The Company develop, manufacture and market rotary joints, precision unions, steam and condensate systems, components, and controls used primarily in the dryer section of the papermaking process and during the production of corrugated boxboard, metals, plastics, rubber, textiles, chemicals and food. Its principal fluid-handling systems include rotary joints, siphons, turbul! ator bars, and engineered steam and condensate systems. Its mechanical devices, used with rotating shafts, allow the transfer of pressurized fluid from a stationary source into and out of rotating machinery for heating, cooling, or the transfer of fluid power. Its devices, installed primarily inside the rotating cylinders of paper machines, are used to remove condensate from the drying cylinders through rotary joints located on either end of the cylinder. Its steel or stainless steel axial bars, installed on the inside of cylinders, are used to induce turbulence in the condensate layer to improve the uniformity and rate of heat transfer through the cylinders. Its steam systems control the flow of steam from the boiler to the paper drying cylinders, collect condensed steam, and return it to the boiler to improve energy efficiency during the paper drying process.

The Company develop, manufacture and market a range of doctoring systems and related consumables that continuously clean rolls to keep paper machines running efficiently; doctor blades made of a variety of materials to perform functions, including cleaning, creping, web removal, flaking, and the application of coatings, and profiling systems that control moisture, Web curl, and gloss during paper converting. Its principal doctoring products include doctor systems and holders, profiling systems and doctor blades. Its doctor systems clean papermaking rolls to maintain the operation of paper machines and other equipment by placing a blade against the roll at a constant and uniform pressure. A doctor system consists of the structure supporting the blade and the blade holder. It offers profiling systems that control moisture, Web curl, and gloss during paper converting. It manufacture doctor and scraper blades made of a variety of materials, including metal, bi-metal, or synthetic materials that perform a variety of functions, including cleaning, creping, Web removal, flaking and the application of coatings.

The Company devel! ops, manu! facture and markets water-management systems and equipment used to continuously clean paper machine fabrics and rolls, drain water from pulp mixtures, form the sheet or Web, and filter the process water for reuse. Its principal water-management systems include shower and fabric-conditioning systems, formation systems, and water-filtration systems. Its shower and fabric-conditioning systems assist in the removal of contaminants that collect on paper machine fabrics used to convey the paper Web through the forming, pressing and drying sections of the paper machine. A typical paper machine has between 3 and 12 fabrics. It supplies structures that drain, purify, and recycle process water from the pulp mixture during paper sheet and Web formation. It offer a variety of filtration systems and strainers that remove contaminants from process water before reuse and recover reusable fiber for recycling back into the pulp mixture.

The Company competes with Voith Paper GmbH, Metso Corporation, Maschinenfabrik Andritz AG, Deublin Company, Barco Company, Christian Maier GmbH & Co. KG, Duff-Norton Company, Joh. Clouth GmbH & Co. KG, Bonetti, S.p.A., Metso Corporation and IBS-Paper Performance Group.

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 Kadant (NYSE: KAI  ) , whose recent revenue and earnings are plotted below.

Sears reports wider loss, sales drop

Sears Holdings reported a wider loss in the first quarter as the retailer controlled by hedge-fund manager Edward Lampert continued to struggle to turnaround its business.

The parent company of Kmart and Sears said it lost $402 million, or $3.79 per share, for the period ended May 3. That compares with a loss of $279 million, or $2.63 per share, in the same period a year ago

Excluding certain items, the retailer lost $2.24 per share. That was worse than the loss of $1.91 a share expected by analysts, according to FactSet.

Revenue fell 6.8% to $7.88 billion, which was better than the $7.72 billion analysts expected.

Shares plunged 7% in pre-market trading to $33.90.

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The retailer has been struggling to turn around its flagging business as rivals have been drawing away its customers. It has focused on reducing costs, cutting inventory, closing stores and selling or spinning off some assets.

Sears recently said it is considering selling its Canadian operations and also spun off its Lands' End unit as a separate public company.

Edward Lampert took over as CEO in May 2013, replacing Louis D'Ambrosio.

Stocks Set To Rise Ahead of Fed

*DISCLOSURES: Scott Redler is flat

There are mixed and subdued markets around the world as Europe hugs the flat line EU bond yields rise in Italy and Spain (we haven't heard that in a while). The ECB is also is in focus as some think they could go to negative interest rates. Asia is mixed as Japan was off small as it waits on the BOJ and the Shanghai bounces back 0.84%.

Today we get Fed minutes, which sometimes move markets, especially after Plosser's remarks yesterday that some believe ignited the weakness mid-day. I'm not so sure it was his statements that made the difference, all I know is that frustration is running high and there is a distinct difference between the action in each market. Some think the erratic, random, thin action could lead to a big decline in the S&P and Dow.

Some think that the correction we saw in many growth stocks and sectors "was the correction" and the broader indices held up just fine. I am trying to take it day by day as buying after a multi-day move has been stressful except for "unique" situations. But if you try and press shorts after an initial move (especially SPY, DIA) you probably didn't do so well either.

Today S&P futures are up 3-4 handles. We are still above important intermediate support of 1862-1865ish. As long as we stay above this, you can't be super short this index. Resistance stands at 1885-1890 then 1902. I am on my toes and very flexible.

The Nasdaq ETF (QQQ) is trying to act better, as we've had a few better set ups recently.  There is some support at $87.30 but more important support here is $86.50ish. Resistance stands at $88.60.

The Russell 2000 ETF (IWM) turned back lower after a move off last week's lows. The 21-day has been big resistance here for the past few weeks where it got rejected again. Big support is $107.44-108.42.

High beta tech hangs a bit tougher.

Netflix (NFLX) was able to eke out another 2% gain after the clean breakout on Monday as it was listed on our Off The Charts newsletter on Sunday night with an entry at $350. The stock went as high as $372.70 and closed on highs, showing some commitment. It's hard to buy after a three-day rally but it's nice to see this high beta waking up again. Some digestion above the two-day support of $362 could keep its momentum intact for a further short squeeze.

Apple (AAPL) held above the breakout level of $597.50 as it put in a pivot low at $600.73 and stayed above this level most of yesterday's session. Use yesterday's low as the new point of reference to trade against as holding above this could lead to a potential breakout above $607.

Google (GOOG) had a nice two-day rally to retest the short-term resistance of $536. It did close well off of highs but found support at Monday's intra-day level of $526. Holding above the 2-day support of $526 would keep it in the game for a break above this pivot resistance.

Amazon (AMZN) took its turn to lead this group up as the stock showed relative strength in the morning to get a nice rally up to retest its 21-day EMA at $305. It still has a lot to prove but holding above the recent pivot low of $290 would keep it in the game. The pivot action area was $299 from yesterday's note.

Tesla (TSLA) has been inching up since dip buyers stepped in at the 200-day EMA two weeks ago. There's been a few trades along the way. The stock has regained the support of its 8-day EMA. I do think it's vulnerable. A break below $190 could put pressure back on.

Facebook (FB) tried to build on Monday's Day #1 but failed yesterday. It couldn't hold $59.56 (RDR pivot) and then got pressured. Perhaps a trade below $58.18 and some that are trying to be short this could have some success. This range is getting frustrating.

There's been some action in biotech stocks.

The Biotech ETF (IBB) continued to build a tight mid-level range above its 200-day EMA. The longer it stays above $225, the higher the probability it could see a break above the weekly resistance of $233.80.

Biogen (BIIB) has been hovering around its 8- and 21-day EMA to build a tight range. A break above $294 on good volume could set it back in motion. I'd keep stops in at $285.

Buying Health Insurance in the Off Season

I'm leaving my job in a few months and moving to New York. Can I get new health insurance even though open enrollment is over?

SEE ALSO: Signing Up for Health Insurance Outside of Open Enrollment

Yes. Even though open enrollment for individual health insurance is closed until November 15, you can buy a new policy now (either on a state exchange or directly from an insurer or agent) if you move or experience certain other "life changes," including getting married or divorced, having or adopting a baby, and losing other health insurance. You generally have 60 days from the date of the event to buy a new policy. See Apply with a Special Enrollment Period for more information.

The rules for buying a new policy when you move vary by state. For example, you can buy a policy from the New York State of Health (New York's health insurance exchange) outside of open enrollment if you permanently move to New York State or if you permanently move from one county to another within the state. You have 60 days from the date of your move to select a health plan. See the New York State of Health's FAQs on Special Enrollment Periods for details.

Losing health insurance when you leave your job also makes you eligible for a special enrollment period in any state -- even if you could extend your current policy through COBRA -- as long as you haven't signed up for COBRA yet. (COBRA is the federal law that requires insurers with 20 or more employees to let you keep your employer coverage for up to 18 months after you leave your job. It's often a better deal to look for coverage on your own rather than getting COBRA because you must pay the full cost of COBRA coverage yourself.) Keep in mind that if you change plans in the middle of the year, your deductible and out-of-pocket limit will reset, and medical costs you paid for under your old plan won't count toward the new plan's limits.

Because you're leaving your job, you'll need to estimate what your income will be for the rest of the year and add that to the income you've already earned in 2014, to see whether you're eligible for a subsidy (you qualify if your income is less than 400% of the federal poverty level -- $46,680 if you're single or $62,920 for a couple). Notify the exchange if your income ends up being lower than your estimate (so you can get a bigger subsidy) or if it's higher than you anticipated (so you don't have to pay some of it back when you file your tax return in the spring). See Beware Pitfalls of Health Care Subsidy for more information about subsidy surprises.

Got a question? Ask Kim at askkim@kiplinger.com.

Tax Extenders Bill Stalled In Senate

Remember that Tax Extenders Bill that seemed to be moving ahead? Consider it stalled.

Amid a flurry of proposed amendments to the bill, Sen. Harry Reid (D-NV) moved to consider a cloture motion on Amendment No. 3060 to H.R. 3474. H.R. 3474 is the Hire More Heroes Act, originally intended "[t]o amend the Internal Revenue Code of 1986 to allow employers to exempt employees with health coverage under TRICARE or the Veterans Administration from being taken into account for purposes of the employer mandate under the Patient Protection and Affordable Care Act." The amendment was offered "in the nature of a substitute" which means that it would strike out the entire text of the bill and replace it with a different text.

Cloture is a procedure by which the Senate can put an end to a debate without actually voting a matter down. Procedurally, what happened is this: a motion was made to table Amendment No. 3060. By rule, no debate is allowed on a cloture motion. A vote in favor of cloture is a vote to end debate on the original matter and go to a vote (in this case, the tax extenders bill) while a vote against is a vote to keep debating.

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The vote was 53-40 in favor but since the Senate needed 60 votes, by rule, the measure will remain open to debate and will not move to a vote. Those who voted did so along party lines with Sen. Reid breaking ranks to vote no, a move for the sake of procedure, and Sen. Mark Kirk (R-IL) voting yes (you can see the roll call here).

Why the divide? Republicans in the Senate accused Sen. Reid of not wanting to broker a deal on the bill, including adding provisions that would eliminate the wind production credit and repeal the ObamaCare medical device tax. Sen. Reid has suggested that the debates were simply a political tactic and that any amendments to the bill could be offered later as an amendment package.

The result? Both sides are crying foul while the future of the bill remains uncertain. The measure could come up for debate in the near future (that's why Sen. Reid voted no, in order to do so) but chatter suggests that we won't hear about it again until after the elections.

–

Want more taxgirl goodness? Pick your poison: receive posts by email, follow me on twitter (@taxgirl), hang out with me on Facebook or check out my YouTube channel. If you want to keep an eye on documents I've posted, check out my profile on Scribd. And finally, you can subscribe to my podcast on the site or via iTunes (it's free).

Demographics: Now and Later

For more than three years now a number of economists and market watchers have been stubbornly calling for an inflationary bubble to inflate but, by and large, have been disappointed. While the prices of some assets have been on the rise, so far we haven't experienced widespread inflationary pressures throughout the economy.

Jeffrey Gundlach, who came to fame as a star bond fund manager at TCW Asset Management and went on to found Doubleline Capital, has an interesting theory as to why that may be. With more than $47 billion in assets under management, about 90 percent of which is in fixed-income vehicles, Gundlach has a strong incentive to keep an eye on inflation.

He believes that inflation has failed to materialize, despite the Federal Reserve's best efforts amounting to nearly $3 trillion in cheap cash, largely thanks to demographics. The baby boom generation, one of the largest generations in American history at about 80 million people, has essentially begun aging out of the workforce, with about 18,000 people reaching retirement age each day. By the end of the decade there will more than 14.5 million Americans over the age of 65, making it the largest demographic bulge bracket, and that number will swell to nearly 72 million by 2030 and account for about 20 percent of the population.

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As those folks retire, they will live on much lower incomes since their homes are usually paid off, their children are likely to have completed college. There are simply fewer big ticket expenditures for retirees, and if past experience is a guide, their retirement incomes will barely keep pace with even the current low levels of inflation, adding additional deflationary pressure.

Also thanks to that wave of retirements, it is estimated that the American workforce will grow by j! ust 0.2 percent annually over the coming decade as compared to annual growth of about 1.2 percent over the prior 10 years. Although there are some signs that wages may begin rising over the next year or so thanks to falling unemployment, incomes have been largely stagnant over the past five years.

Slower workforce growth combined with a growing wave of retirees on a fixed income reduces the velocity of money even as demand growth slows, reducing inflationary pressures on the economy.

When you look at the types of assets which are experiencing pricing pressure, that argument makes a certain amount of sense. For instance, the greatest inflation we've experienced over the past two years has largely been tied to agricultural commodities and foodstuffs. Even when you're retired, you still must eat. Health care costs have also experienced high inflation which, while you can make the case that that is to some degree due to inefficiencies in the system, it is also tied to the growing consumption demand related to an aging population.

But while that demographic argument makes sense today, it will be shifting over the next few years.

Like every other generation the baby boomers grew up and had children before they retired and the generation they begot dwarfs their own. Regardless of whether you call them millennials, echo-boomers or any other name, there were more than 95 million Americans born between 1978 and 2000. While the leading edge of that generation has finished college and had the misfortune of entering the workforce during the recession, the real wave of which will be coming in the next few years.

Already, many millennials are better off than their parents 30 years ago in terms of buying power. For instance, while the generation already carries more debt and faces higher home prices than their parents, their real average incomes are about $2,500 based on census data. While that might now sound like much today, when you consider that that extra buying power is spread ac! ross 95 m! illion people whose wages will (hopefully) only be going up as they age, that's a huge amount of extra demand over the next two to three decades.

So, while you can make a strong demographic argument for why inflation is running at relatively low rates today, that same argument will get turned on its head tomorrow.

NYT replaces Abramson with Baquet as top editor

The New York Times said Wednesday that its executive editor, Jill Abramson, has stepped down and was replaced by managing editor Dean Baquet, a sudden change that would install the paper's first African-American newsroom leader.

The changes, effective immediately, come as a surprise for the rank and file and to company watchers.

In an e-mail, Times spokeswoman Eileen Murphy said Arthur Sulzberger, Jr., the publisher of The Times and chairman of The New York Times Company, "made the decision because he believed that new leadership would improve some aspects of the management of the newsroom."

Widely respected for her journalistic skills, Abramson made history as the paper's first female editor when she was promoted to the job in 2011. But she also has a reputation for a hard-charging, and at times prickly, personality.

The paper's leaders also have had to deal with a series of high-profile defections by reporters and editors, who left for competitors and media startups.

She is also credited with overseeing the organization at a time of deep changes, including the paper's aggressive shift toward digital journalism and decision to charge readers for content online.

"I've loved my run at The Times," Abramson said in a statement. "I got to work with the best journalists in the world doing so much stand-up journalism."

Abramson was not immediately reachable, and the company said she was "no longer here."

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Baquet, a Pulitzer Prize winning journalist who previously worked as editor of The Los Angeles Times, has been managing editor at the Times since September 2011.

"There is no journalist in our newsroom or elsewhere better qualified to take on the responsibilities of executive editor at this time than Dean Baquet," said Arthur Sulzberger, Jr., the publisher of The Times and chairman of The New York Times Company, ! in a statement. "He is an exceptional reporter and editor with impeccable news judgment who enjoys the confidence and support of his colleagues around the world and across the organization."

Sulzberger initially made the announcement to senior editors Wednesday afternoon, and addressed the full newsroom around 2:30 p.m., according to a report by The New York Times.

Ravi Somaiya, the Times' reporter who covers the media beat, tweeted that Sulzberger cited "an issue with management in the newsroom" as a reason for the change.

Alex Jones, a former Times reporter who teaches media and public policy at Harvard University, says Abramson doesn't have "any journalistic apologies to make."

"She was the head of the newsroom at a difficult time," he said. "I worked for several top editors (at the Times). Every single one of them is pushy and demanding. I don't think she is any more difficult than others. I think, overall, that just goes with the territory. It's a demanding, high-standards place."

Hyundai will appeal $248.6M verdict in fatal crash

POLSON, Mont. — A Montana jury has ordered Hyundai to pay $240 million in punitive damages on top of $8.6 million in actual damages and lost earnings after finding that a manufacturing defect in a Hyundai Tiburon caused a crash that killed two Missoula cousins in July 2011.

The award handed down late Tuesday was to the families of 19-year-old Trevor Olson and 14-year-old Tanner Olson, who died when their 2005 Tiburon slammed head-on into another car.

Hyundai Motor America released a statement Wednesday saying it plans an immediate appeal. It said that it believes the jury's verdict is mistaken and a damage award of three times what was sought by the plaintiffs is "outrageous and should be overturned."

It's also unclear if the punitive damages will stand under state law. Montana has a $10 million cap on such damages, but that's being challenged after a District Court judge in Butte ruled it wasn't high enough to deter future wrongdoing by wealthy companies.

The lawsuit alleged that a defective steering knuckle in the Tiburon that Trevor Olson was driving caused the car to suddenly veer into an oncoming lane and crash into another car. A passenger in that car, 21-year-old Stephanie Nicole Parker-Shepherd of Arlee, was killed while her husband and two children were severely injured.

Hyundai issued a recall in 2005 for 111 Tiburons manufactured over a one-month period that year over a steering issue, but the problem was different than the one cited at trial and it's no known if the teens were driving one of those cars.

There have been relatively few complaints filed against the 2005 Hyundai Tiburon with the National Highway Transportation Safety Administration. Out of the 37 complaints filed, only two had to do with the vehicle's steering system, according to the agency's database.

Hyundai argued that something else — most likely a firecracker being set off in the Hyundai — caused the driver to suddenly react and caused the car to swerve.

"Eyewitness test! imony established — and experts for both sides agree — that fireworks exploded in the unbelted teenagers' vehicle immediately before the … accident," the Hyundai statement said.

Montana Highway Patrol Trooper Terrance Rosenbaum testified that he found no evidence that any fireworks had been ignited in the car and that the Montana State Crime Lab could find no evidence to prove or disprove that claim.

The damage to the steering knuckle was the result of, not the cause of, the head-on crash, Hyundai said. The company noted the steering knuckle in the other vehicle also was damaged.

A defense expert testified some of the damage to the Hyundai's steering knuckle existed before the crash.

Hyundai said District Judge Kim Christopher would not let the company present evidence that if the steering knuckle had failed, the car would have swerved to the right, not the left as happened in the crash.

Flight cancellations this winter worst in decades

As many stranded fliers suspected, the number of flights canceled this winter was the worst in two decades, according to the Department of Transportation's Bureau of Transportation Statistics.

During the first three months of this year, 4.58% of the more than 1.4 million domestic flights scheduled by 14 of the nation's carriers were canceled. That meant 64,419 flights didn't get off the ground.

Flights that weren't scrapped altogether were often delayed during this winter of harsh cold and snowstorms, with the first three months of the year posting an on-time arrival rate of 72.1% — the fourth-lowest in 20 years.

Still, March was an improvement on the month before, coming at the tail end of a dismal winter. In March, 77.6% of flights by the nation's biggest carriers touched down on schedule.That was in comparison with the 70.7% on-time arrival rate in February, but lower than the 79.8% of flights that arrived on time in March of last year.

Of the flights that didn't arrive on time in March, 24.7% of them were late because of weather, as compared with 32.7% in February and 34.1% of delayed flights last March.

While airlines canceled 1.9% of their domestic flights in March, that was far below the 5.5% of flights canceled in February.

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Of the nation's 29 busiest airports, passengers heading to Salt Lake City had the best chance of touching down on time in March with that portal's on-time arrival rate of 85.8%. But those flying to Fort Lauderdale were most likely to be delayed, with that airport posting an on-time arrival rate of 71.6%

When it came to airlines, passengers flying on Hawaiian had the best chance of reaching their destination on time, with 91.6% of the carrier's flights landing on schedule in March, followed by Alaska and Virgin America.

Meanwhile, ExpressJet had the worst performance, with only 70.9% of its flights ! arriving within 15 minutes of the scheduled time. American Eagle and Southwest were also at the bottom, with 73.35% and 72.22% of their flights landing on time, respectively.

Fewer bags were mishandled in March, with 3.68 reports per 1,000 fliers compared with 4.21 in February. But that was an increase over last March, when there were 3.03 reports per 1,000 passengers.

Overall, complaints about mishandled bags are up this year, with 4.43 reports per 1,000 fliers during the first three months of 2014, vs. 3.14 reports per 1,000 passengers during that period in 2013.

Set A Plan and Get Invested

If you've been in cash for the last few years, you've missed some gains, but we don't think it's too late to get back in, says fund specialist Janet Brown, editor of NoLoad FundX.

Overall, US markets have been on a tear since last November. After such strong gains this year, we may see more volatility in the market.

Ned Davis Research points out that, historically, when the S&P 500 has gained 15% or more through July, "the benchmark has struggled over the following few months." If this occurs this year, it could present a buying opportunity for those who are looking to get into the market.

Valuations are still appealing. Stocks are not as expensive as they were in 2007, and the market is different, too. In 2007, most markets had enjoyed strong gains. But this year, many areas of the market haven't participated—look at emerging markets or Europe funds, for example. Eventually some areas will have some potential catching up to do.

Even if this year's rally looked like 2007, that wouldn't tell us whether we were at the peak of the market, ready to face a substantial decline, like 2008.

Market action rarely repeats, so the next bear market is probably not going to be like the previous bear market, just as the latest bull market isn't like the previous one. In 2008, all sectors sank, but that may not hold true in the next decline.

What should you do now? It's easy to get caught up in where the market's been and where it's headed, but if you're considering putting money to work, it's important to take a step back and consider why you are investing in the first place.

Many investors are looking to fund long-term goals, such as retirement or their child's college education. In order to achieve those goals, most investors need their portfolios to grow, and the best option for long- term growth is stocks. The next challenge is what to invest in.

We urge investors to set a plan to get back in the market. We tend to get a substantial part of a portfolio invested right away, and then we invest the rest gradually, on a schedule set in advance, often making additional investments on down days in the market.

When you're ready to get invested, market sell-offs are an opportunity to get invested at lower prices.

If you've been out of the market and missed some gains, you may be tempted to compensate by taking on more risk. We believe it can be better to take less risk when you are just starting to invest again. Remember, you aren't just looking to get invested, you're looking to stay invested.

Meanwhile, our strategy is to Upgrade portfolios into the best performing funds. Upgrading is the investment approach we developed years ago, and have been applying in our client accounts for decades.

It follows market leadership by keeping assets in the best-performing no-load mutual funds and exchange traded funds, as determined by our performance-based ranking system.

Among total return funds, here a look at our current top ranked mutual funds:

AmBeacon Balanced (AABPX)

Dodge & Cox Balanced (DODBX)

Mairs & Powers Balanced (MAPOX)

T. Rowe Price Capital Appreciation (PRWCX)

Villere Balanced (VILLX)

Subscribe to NoLoad FundX here…

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5 Must-See Charts to Trade for Gains

BALTIMORE (Stockpickr) -- Earnings season is drawing to a close – that should help to yank some of the headline risk out of the stock market for the next month or two. And it's setting the stage for upside for the rest of the summer.

Over the course of this rally, earnings seasons have been a chance for the market to hold its breath. That's not hugely surprising; after all, this has been one of the most-hated equity rallies in history, so it makes sense that investors have braced for a smack-down each quarter during earnings.

Thing is, it hasn't happened. So as the broad market fuels up for another big move, it makes sense to take a technical look at the breakout trades forming infive of the biggest names on Wall Street. These are five must-see charts.

If you're new to technical analysis, here's the executive summary.

Technicals are a study of the market itself. Since the market is ultimately the only mechanism that determines a stock's price, technical analysis is a valuable tool even in the roughest of trading conditions. Technical charts are used every day by proprietary trading floors, Wall Street's biggest financial firms, and individual investors to get an edge on the market. And research shows that skilled technical traders can bank gains as much as 90% of the time.

Every week, I take an in-depth look at big names that are telling important technical stories. Here's this week's look at five high-volume stocks to trade this week.

SPDR S&P 500 ETF

Up first, it makes sense to take a closer look at what's going on in the big picture: the S&P 500. To make it tradable, we'll use the SPDR S&P 500 ETF (SPY) as our proxy. At first glance, you don't have to be an expert technical trader to figure out what's going on in the big index; the S&P uptrend is still very much intact this month.

It's just not the same uptrend that SPY was in back at the start of the summer, but that's OK. While SPY may not be moving up at quite the same pace that it started at, the fact that this ETF is making higher highs and lows comes without question. Earnings season started on July 8, and as you can see from the chart above, the S&P has basically been consolidating sideways ever since. Consolidations are healthy for stock rallies, giving traders a chance to catch their breath and establish a base, and with earnings season ending, the uptrend looks likely to resume.

When stocks are trending higher, there really isn't a bad time to be a buyer -- but there is an optimal time. That optimal buying point comes when SPY bounces off of trendline support. Buying off a support bounce makes sense for two big reasons: it's the spot where shares have the furthest to move up before they hit resistance, and it's the spot where the risk is the least (because shares have the least room to move lower before you know you're wrong).

That's when I'd suggest picking up shares of this ETF.

Apple

Apple (AAPL) has had a less impressive run in 2013. Shares of the tech behemoth are down around 6% since the calendar flipped over to January -- not horrific performance unless you consider the fact that the S&P 500 has gained more than 18% over that period. Ouch.

But Apple's bear run looks like it's nearing an end thanks to a multi-month breakout above the $460 level. Apple is breaking out of a double bottom pattern, a setup formed by two swing lows that take place at approximately the same price level. In AAPL's case, those swing lows bottomed out in late April and late June, and this week's breakout signals a buy.

Whenever you're looking at any technical price pattern, it's critical to think in terms of buyers and sellers. Rectangles, double bottoms and other price pattern names are a good quick way to explain what's going on in this stock, but they're not the reason it's tradable. Instead, it all comes down to supply and demand for shares.

That resistance line at $14.50, for example, is a price at which there was an excess of supply of shares; in other words, it's a place where sellers had been more eager to take recent gains and sell their shares than buyers were to buy. That's what made the move above it so significant -- the breakout indicated that buyers are finally strong enough to absorb all of the excess supply above that price level.

If you jump in here, I'd recommend putting a protective stop just below the 50-day moving average.

Chevron

Oil and gas supermajor Chevron (CVX) is another name that's showing investors a bullish technical setup right now. Chevron is forming a textbook ascending triangle pattern, a price setup that we've seen a lot of on the way up in 2013. Here's how to trade it.

Chevron's ascending triangle is formed by horizontal resistance above shares at $127.50 and uptrending support below shares. Basically, as CVX bounces in between those two technical price levels, it's getting squeezed closer and closer to a breakout above $127.50. When that breakout happens, we've got our buy signal.

The energy sector spent the last quarter as a bit of a laggard, but it's been heating back up in the last month and change. With a breakout trade getting close to triggering here, Chevron offers one of the best-in-breed ways to play the trend this summer.

Green Mountain Coffee Roasters

Last up is Green Mountain Coffee Roasters (GMCR), a stock that I wrote about yesterday as a potential short squeeze name. Besides the hefty shorting in GMCR (the short interest ratio sits at 11.4), this stock is also showing some technical strength right now, a combo that could magnify this stock's upside potential in the near-term.

GMCR has been forming an inverse head and shoulders pattern, a setup that's formed by two swing lows that bottom out at approximately the same price level (the shoulders), separated by a deeper swing low (the head). Typically, inverse head and shoulders patterns show up at the bottom of a stock's recent price action -- not the case here. Instead, GMCR's setup is showing up at the top of its recent price action. But as I mentioned, whether or not the pattern is "textbook" matters a whole lot less than the supply and demand forces causing it. Either way, the trading implications look good in GMCR right now.

The buy signal for Green Mountain comes on a breakout above its neckline at $82.50. When that level gets taken out, this stock becomes a high probability trade. From a risk-management standpoint, it makes sense to keep a protective stop just below the right shoulder.

To see this week's trades in action, check out this week's Must-See Charts portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.

Booming Housing Market Boosts U.S. Economy

With new home sales 29% higher than they were a year ago and home prices rising, the real estate market has established itself as a leading force in keeping the U.S. economy buoyant.

About 476,000 new single-family houses were sold in May, up 2.1% from April and fully 29% higher than the estimate of 369,000 in May 2012, according to data released jointly on Tuesday by the U.S. Census Bureau and the Department of Housing and Urban Development. Economists in a MarketWatch poll had predicted May sales would reach 464,000.

Not only were new homes selling at the highest rate since mid-2008, but sales for the prior three months were all revised higher. Around the U.S., purchases rose the most in the Midwest, up 40.7%, followed by the Northeast, up 20.7%. Sales in the South dropped, however, by 9%.

A Strong Year for Builders

“The best year for new home sales since 2008 continues apace,” wrote Steve Blitz, chief economist with ITG Investment Research, in a comment released shortly after the report came out. “In sum, the state of the new homes for sale market is that it is recovering, still has a very long way to go, but the balance within the industry between sales and inventory make it a strong year for builders despite the still depressed level of activity.”

In addition, single-family home prices in the S&P/Case Shiller composite index for 20 metropolitan areas were reported as 1.7% higher in April on a seasonally adjusted basis, reaching their biggest annual increase in seven years and surpassing analysts’ expectations for a 1.2% gain. Prices rose 12.1% year over year for their biggest annual gain since March 2006. According to the Census/HUD report, which measures prices differently, the median price of new homes dropped 3.2% to $263,900 last month from a record high of $272,600 in April.

Younger Americans show signs of contributing to the upward trend in the U.S. housing market. A Harris Interactive survey by MortgageMarvel.com released on June 19 found that among Americans ages 18 to 34, a total of 41% (46% of men and 36% of women) said they were interested in buying a home this year. Of those, 17% of men and 6% of women said their finances were shaky, but they still thought they could swing buying a home this year.

Mortgage Rates Up as Bernanke Eyes Backing Off QE

Meanwhile, mortgage rates are rising — an interesting turn of events considering Federal Reserve Chairman Ben Bernanke’s recent comments about tapering the Fed’s quantitative easing program. Residential rates have reached the mid-4% mark, a percentage point above last year’s record lows.

 “Rates on 30-year fixed mortgages hit 4.25% on Thursday, up from 4.12% on Wednesday morning before the Fed chairman, Ben S. Bernanke, signaled the central bank might begin easing back on stimulus efforts later this year,” The New York Times reported on June 20.

ITG Investment Research’s Blitz noted that from the Fed’s perspective, the bounce in home sales is in line with the improved U.S. employment picture.

“Pushing rates lower is no longer the best tactic, while it is still way too early to push rates higher,” Blitz wrote. “To the extent higher real interest rates reflect a stronger economy and, in turn, better employment growth, we could expect much better home sales regardless of where the market is pricing 30-year fixed [mortgages]. People should not automatically assume higher mortgage rates, by themselves, will necessarily damage home sales.”

---

Read Taper Tantrum: Markets Recoil, Advisors Scramble on Fed News at AdvisorOne.

John Rogers Comments on Coach Inc.

A few of our holdings struggled at quarter end. Specialty retailing Coach, Inc. (COH) de clined –10.91% after missing expectations. The company reported EPS of $1.06 after making $1.23 per share last year. Consensus had been $1.11. The main culprit was lower traffic in retail stores. It has been a very difficult winter for many retailers, but for Coach the more important issue is its st yle turnaround. Stuart Vevers, the new creative director, has his first complete line appearing this spring and hitting stores next fall. As long- term investors, a six-month waiting period is not difficult, but obviously, Wall Street is less patient than we are. We believe the company will emerge with its brand largely intact, new products to captivate customers and better financial results to follow.From John Rogers (Trades, Portfolio)' Ariel Appreciation Fund first quarter 2014 letter. Also check out: John Rogers Undervalued Stocks John Rogers Top Growth Companies John Rogers High Yield stocks, and Stocks that John Rogers keeps buying

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Wednesday, May 7, 2014

4 Stocks Rising on Big Volume

DELAFIELD, Wis. (Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

>>5 Stocks Set to Soar on Bullish Earnings

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

>>5 Stocks Ready to Break Out

With that in mind, let's take a look at several stocks rising on unusual volume recently.

ICICI Bank

ICICI Bank (IBN), together with its subsidiaries, provides banking and financial services to corporate and retail customers in 19 countries, including India. This stock closed up 3.6% to $44.26 in Monday's trading session.

Monday's Volume: 5.33 million

Three-Month Average Volume: 1.82 million

Volume % Change: 226%

From a technical perspective, IBN ripped sharply higher here right above some near-term support at $42.37 with heavy upside volume. This stock has been trending sideways for the last month and change, with shares moving between $41.54 on the downside and $44.95 on the upside. This spike higher on Monday is starting to push shares of IBN within range of triggering a big breakout trade above the upper-end of its recent range. That trade will hit if IBN manages to take out some near-term overhead resistance levels at $44.70 to $44.80 and then once it clears more key resistance at $44.95 with high volume.

Traders should now look for long-biased trades in IBN as long as it's trending above some key near-term support levels at $42.37 or above its 50-day at $41.62 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.82 million shares. If that breakout triggers soon, then IBN will set up to re-test or possibly take out its 52-week high at $48.44.

RCS Capital

RCS Capital (RCAP), through its subsidiaries, is engaged in the wholesale broker-dealer, and investment banking and capital markets business activities. This stock closed up 6.8% to $35.87 in Monday's trading session.

Monday's Volume: 159,000

Three-Month Average Volume: 75,465

Volume % Change: 147%

From a technical perspective, RCAP ripped higher here right above its 50-day moving average of $30.02 with strong upside volume. This move is quickly pushing shares of RCAP within range of triggering a major breakout trade. That trade will hit if RCAP manages to take out some near-term overhead resistance levels at $37.56 to $39.40 and then once it clears its 52-week high at $39.98 with high volume.

Traders should now look for long-biased trades in RCAP as long as it's trending above its 50-day at $32.02 and then once it sustains a move or close above those breakout levels with volume that hits near or above 75,465 shares. If that breakout hits soon, then RCAP will set up to enter new all-time-high territory above $39.98, which is bullish technical price action. Some possible upside targets off that breakout are $45 to $50.

Hi-Crush Partners LP

Hi-Crush Partners LP (HCLP) operates as a producer and supplier of monocrystalline sand. This stock closed up 2.1% at $41.83 in Monday's trading session.

Monday's Volume: 601,000

Three-Month Average Volume: 252,000

Volume % Change: 164%

From a technical perspective, HCLP trended higher here with above-average volume. This stock has been uptrending for the last month, with shares moving higher from its low of $36.51 to its intraday high of $42. During that move, shares of HCLP have been making mostly higher lows and higher highs, which is bullish technical price action. This spike higher on Monday is starting to push shares of HCLP within range of triggering a major breakout trade. That trade will hit if HCLP manages to take out Monday's high of $42 to its all-time high of $43.97 with high volume.

Traders should now look for long-biased trades in HCLP as long as it's trending above its 50-day at $39.24 and then once it sustains a move or close above those breakout levels with volume that hits near or above 252,000 shares. If that breakout materializes soon, then HCLP will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $50 to $55.

Sotheby's

Sotheby's (BID) operates as an auctioneer of authenticated fine art, decorative art, and jewelry. This stock closed up 3.2% to $44.80 in Monday's trading session.

Monday's Volume: 3.62 million

Three-Month Average Volume: 1.36 million

Volume % Change: 157%

From a technical perspective, BID spiked notably higher here back above its 50-day moving average of $43.89 and right into its 200-day moving average of $44.62 with strong upside volume. This stock has been uptrending over the last few weeks, with shares moving higher from its low of $38.83 to its intraday high of $44.86. During that move, shares of BID have been making mostly higher lows and higher highs, which is bullish technical price action. Market players should now look for a continuation move higher in the short-term if BID manages to take out Monday's intraday high of $44.86 with strong upside volume.

Traders should now look for long-biased trades in BID as long as it's trending above Monday's low of $42.57 or above $42 and then once it sustains a move or close above $44.86 with volume that hits near or above 1.36 million shares. If that move starts soon, then BID will set up to re-test or possibly take out its next major overhead resistance levels at $47 to $49, or even $50 to $51.

To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

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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.

Monday, May 5, 2014

CarMax - A Business Analysis

In a recent interview right here on GuruFocus, Tom Gayner of Markel (MKL) had a few things to say about CarMax (KMX). This prompted me to give the company a closer look. What follows is a business analysis. We will save considerations of stock analysis, such as price, for a later discussion.

I think that is a business that will continue to grow. I don't see any reason why you can't have a Carmax in a lot of towns way beyond what they're talking about right now. I think being the number one dealer, and having the number one market share in used car arena gives you great information on what transaction prices are. Then you work on the process to be as quick and as cost efficient in fixing the car and getting it sold, and have the confidence from customers when you offer warranties on the products. Those factors create a virtuous cycle. The more you do, the more you can do, the better the pricing is, the more the customers like you, the more your brand matters. The company will be around for a good long time. The management has done a very good job of creating the system and executing it.
CarMax was formed as a unit of Circuit City in 1993 and was spun off in 2002. Used-car sales account for about 80% of revenue. Competitors include, but certainly are not limited to, AutoNation (AN) and America's Car-Mart (CRMT) as well as private party sellers.

Five Forces Model Analysis

Threat of New Entrants: High fixed costs for inventory and access to channels of distribution are the largest barriers to entry for the industry. Economies of scale benefit the firm's competence but do not inhibit new entrants.

Intensity of Competition: From individual car owners to established car dealers, the industry is extremely competitive and customers are price-sensitive.

Bargaining Power of Suppliers: Suppliers have the potential capability to integrate forward in order to directly sell to customers.

Bargaining Power of Buyers: Customers are price sensitive, there are no switching costs, ! and options abound.

Threat of Substitutes: Alternatives exist but most people simply need a car.

Value Chain Analysis

Even though the used car industry is extremely competitive and price sensitive, CarMax does well because it has huge economies of scale. With large inventory, the company can spread its operating costs consistently across individual dealerships. CarMax adds value in five categories.

Acquiring Cars - Most of the cars are acquired through trade ins. This creates a high-quality inventory. CarMax offers a "while you wait" appraisal and gives you an offer that is valid for seven days. They also acquire cars through dealership relationships such as with auction houses.

Managing Inventory - This is the company's real competitive advantage. All inventory goes through a standardized internal inspection process. Cars are separated into "CarMax" and "Valumax" categories and sold through channels focusing on different categories of quality and price.

Operating Stores - Management policies guarantee a consistent customer experience across the company and inventory is shared nationwide.

Marketing and Selling - Website searching, "no haggle" price policy, and inspection guarantee are the key components of the companies value added strategy.

Services - The company differentiates itself from smaller dealers by offering financing, appraising, repairs, guarantees and warranties for every sale.

The process of inspecting and guaranteeing the quality of the cars CarMax re‐sells adds considerable value to the company's brand. This type of service is not likely to be found in other dealerships. The amount of resources that go into the value‐chain activity of managing and sorting CarMax's inventory is difficult to implement, and hard to imitate. While CARFAX Reports offer the same assurances of quality, they cannot offer the other benefits such as auto service and repairs, warranties and financing.

Best Income Companies To Buy Right Now

SWOT Analysis

Strengths - High quality vehicles, large inventory, no haggle prices, customer friendly salesWeaknesses - High PricesOpportunities - Nationwide expansion, improved customer service, backwards integration to the supplier levelThreats - Overhead costs rise with each new store, poor economy, competition
While a poor economy hurts sales, this cuts both ways. In a truly robust market consumers might choose to purchase new cars, while a moderately slow economy encourages customers to trade down to used cars.

The biggest threat to this company is the "Best Buy" (BBY) problem. CarMax's website and transparent appraisal process make it an excellent place to go kick the tires and make an informed purchasing decision. The problem is that many customers will be making that purchase online from a lower-cost provider. Although CarMax's customer-centric shopping environment and service offerings provide some differentiation, I'm not convinced that price-sensitive customers will be willing to pay for the value-added services that CarMax provides.

According to this report, CarMax cars cost on average $2,000 more than the same car from a private party. The loan services, 7-day money back guarantee, 30-day warranty and guaranteed services after purchase are nice. Will customers continue to pay up for them?

Conclusion

At 2.5% market share CarMax is more than twice as large as the next closest competitor in the used car sales industry. With only 107 stores, CarMax is an enticing regional to national growth story with years of growth still ahead of it. On the downside, CarMax is the Best Buy of used cars — the place you go for a product demo before you buy online for less.

CarMax is a great growth story and it benefits from a network effect. CarMax offers the largest selection of used cars in the country. As this model attracts new purchasers, more of them sell their old cars to the company, whic! h enhance! s the selection further and leads to still more customers. Longer term I think the price gap between CarMax and private parties will shrink as economies of scale take effect, thus strengthening the value added proposition.

CarMax has a compelling business model and should be able to grow by adding new stores.
Related links:Right hereTom Gayner

Sunday, May 4, 2014

Are you too old to buy stocks?

One of the worst things about getting older is that it seems like nobody wants you to have any fun. You have to be more careful about your health. When you exercise, you're supposed to keep your heart rate in a safe zone. Some retirees even face having their driver's licenses taken away once they reach a certain age.

It's much the same with investing. After spending a lifetime making investing decisions and gaining valuable experience in the stock market, you'll hear most financial planners tell you that you should take a more conservative approach with less stock exposure. They'll cite the risk of owning stocks and say it's too high once you get older.

Consider your own situation

For many people, that logic makes sense. When you're young, you have time on your side, with decades before you'll need whatever money you save for retirement. With all of that time ahead of you, you can afford to take some big risks -- and even if your investments don't do well at first, it won't be fatal to your long-term financial prospects. That makes high-growth stocks a viable option, even when their prices can fluctuate much more wildly than the overall stock market.

On the other hand, as you approach or enter retirement, you no longer have the luxury of a long time horizon to weather stock market downturns. You need that money now, and if the next market crash happens to hit you at just the wrong moment, you may have to sell at very low prices just to pay your bills.

The concept that you should reduce your allocation to stocks is so universally accepted that certain types of mutual funds do it automatically. Target retirement funds change their investment strategy gradually over time to accommodate your changing risk tolerance. Yet even though these funds make investing automatic, they aren't able to handle all of the specific needs that you may have.

Why one-size-fits-all might not fit you

Reducing stock exposure as you get older only addresses one risk that investors face: the! potential for falling stock prices. But that's not the only risk people have to deal with as they move toward retirement. Inflation is a huge threat to your long-term prospects, even if your portfolio is big enough to cover your costs at the beginning of your retirement years.

Low interest rates have been a big thorn in retirees' sides lately. Even if you lock up a $1 million portfolio in 10-year Treasury bonds, you'll only earn about $27,500 at current rates in order to cover expenses each year. Even if that's enough right now, your portfolio value will remain locked at that $1 million mark, and it won't be long before rising costs eat away the purchasing power of your fixed income.

Top 5 Dividend Companies To Watch For 2015

Stocks, on the other hand, offer not only prices that rise over time but also rising dividends. Many well-known companies have histories of raising their dividend payouts annually for decades. When they push their dividends higher, it provides extra income that retirees can use to keep up with the impact of inflation. Moreover, that income can prevent you from having to sell shares at inopportune moments.

That said, some fortunate people have enough wealth that they can tolerate the risk of market downturns. For them, a typical retirement plan might involve selling some stocks every year to supplement other sources of retirement income.

You can protect against the risk of a market drop by keeping enough money in safer investments to give your stocks a chance to recover. Even though this strategy involves keeping several years' worth of expenses in bonds, CDs, or cash, it still gives you the ability to keep a substantial fraction of your portfolio in assets that will provide you a better return.

As an example, if you had retired in 2007 following this strategy, you might have chosen to forgo selling stocks in 2008 and 2009, waiting until the market reco! vered to ! sell and replenish your cash reserves.

Getting more conservative as you grow older is a basic rule of thumb, and it can be helpful for beginning investors to follow. The better choice, though, is to weigh the risks of different investment strategies and pick the one that will work best for you. That means you won't have to give up the fun of stock investing no matter how old you get.

The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.

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