Drive a Tesla from Tijuana to Vancouver

Tesla CEO Elon Musk says it will be possible to drive one of the company's Model S cars from Tijuana all the way up to Vancouver, Canada.

NEW YORK (CNNMoney) Tesla Motors has completed another big stretch of its planned cross-country network of free electric-car charging stations, the automaker said Wednesday, making it possible to drive an all-electric Model S sedan along the entire West Coast of the United States.

"Tesla West Coast Supercharger network now energized. Travel from Vancouver to Tijuana in styel [sic]," tweeted Tesla CEO Elon Musk.

The nearly 1,800 mile trip is possible, Tesla (TSLA) says, using charging stations along Highway 101 and Interstate 5. Supercharger stations can fully recharge a Model S in about an hour or give it a half-full charge in about 20 minutes, according to Tesla.

The stations are free for Tesla owners to use and are being placed along frequently-traveled major highways to allow long distance travel between major U.S. cities.

Tesla had announced in May that, by the end of 2013, enough Supercharger stations would be in place to allow a drive from New York to Los Angeles. Musk said in September that he plans to embark on a cross-country family trip with his five sons at the end of this year.

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Within two years, the automaker plans to have every part of the continental U.S. within range of a Tesla Supercharger station.

  Tesla Model S: Test drive D.C. to Boston

The Model S can travel! up to 265 miles on a charge, according EPA estimates.

Musk and the New York Times got into a dispute early this year when a reporter for the paper claimed he ran out of power while trying to drive from Washington to Boston using the Supercharger network. A later test drive by CNNMoney reporters showed the car was able to make the drive using the Supercharger network then in place. Tesla ultimately plans to have a charger at least every 80 to 100 miles on heavily traveled route like the Washington-to-Boston corridor.

Musk tweeted on Wednesday that Tesla's East Coast Supercharger Network "should be complete in a few months."

Tesla is also adding battery-swapping capability to some of the stations. With that, a Tesla Model S's battery could be replaced in about 90 seconds with a fully-charged battery. Battery swapping would not be free but would cost roughly as much as a full tank of gasoline, Tesla has said.

Amazon’s Profitless Triumph

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Amazon.com (Nasdaq:AMZN) shares are trading near an all-time high even though the company hasn't earned big profits since around 2010, lost money in 2012 and finished the latest quarter in the red.

Yet, Wall Street is giving the ecommerce giant a thumbs-up because its latest earnings were better than analysts expected. The company's third quarter loss narrowed to $41 million, or 9 cents per share, versus $274 million, or 60 cents, a year earlier. Revenue surged 24% to $17.1 billion, topping expectations of $18.1 billion.

Amazon's operating expenses soared 24%to $17.12 billon, as CEO Jeff Bezos ratcheted up spending on video content, technology and new warehouses among other things. Investors would ordinarily raise alarm bells about companies where costs were rising at about the same rate as revenue, particularly given Amazon's thin 2.9% North American operating margins. But Amazon, as it's been said many times before, isn't like most companies, which seems to bother some pundits.

"There is no other company in the world that has such an awful history of profitability, but continues to be rewarded for it so handsomely," said Sucharita Mulpuru, an analyst at Forrester Research, told Bloomberg News.

Traditional valuation metrics don't apply to Amazon. It trades at an eye-popping multiple that tops 1,300 and is priced well ahead of its average 52-week price target of $331.22. Raymond James analyst Aaron Kessler, however, raised his price target to $446, which implies a 24% upside potential from current levels. Investors who are willing to tolerate lots of risk should buy the shares. CEO Jeff Bezos has been proving the naysayers wrong for years. There is no reason to think that's going to stop now.

What moves stocks such as Amazon is "momentum", a nebulous concept that basically means that people expect the stock t! o continue to rise when a company's future appears – at least for now – seems to be limitless. For bulls, there is plenty to like about Amazon.

U.S. e-commerce spending will hit $262 billion this year, an increase of 13.4% from 2012, according to Forrester Research. Web sales are expected to account for 10% of retail sales by 2017 versus 8% in 2012 and 2013. The increases are even bigger overseas, leading to a 20% gain globally. A whopping 1 billion people around the world buy something online every year.

Of course, Amazon has plenty of competitors. As the New York Times recently noted, Wal-Mart (NYSE:WMT) plans to more aggressively take on the company. "For the first time in decades, Wal-Mart, which drove company after company out of business, has a competitor it sounds a little scared of," the newspaper says. eBay (Nasdaq:EBAY) also is targeting Amazon as it deemphasizes auctions and tries to encourage fixed-price sales.

Amazon reinvented the book business and created the e-reader market with its Kindle device, which it reportedly sells at cost. The company benefits from Amazon Prime, a $79 per month service that enables customers to get two-day shipping and access to video content. Millions more people have signed up for Amazon Prime in the past 90 days, a positive sign ahead of the holiday season. Amazon also expects big things from its cloud computing and data storage business, which one day may outpace its ecommerce operation.

The Bottom Line

Baring any huge mishaps, there appears to be little that can slow the company down. However, the slightest hint of a problem will cause the shares to crater. People willing to accept that sort of risk should buy the stock.

Disclosure - At the time of writing, the author did not own shares of any company mentioned in this article.

Market Wrap-Up For Oct. 24 – Focus on Fundamentals

After U.S. equities seemingly took a breather on Wednesday, stocks ended the session higher, fueled by upbeat Chinese numbers and better-than-expected blue-chip earnings.

Today’s Market Movers

Dow component 3M (MMM) reported a surprisingly strong 5.9% rise in its third quarter earnings, with profits coming in at $1.23 billion, or $1.78 per share. Telecom giant AT&T (T) also beat earnings estimates, while revenues fell in line with expectations. Meanwhile, Ford Motor Company (F) reported strong third-quarter results, and lifted its projections for sales in China.

Be sure to check the Dividend Daily for all the latest earnings reports, analyst moves, and much more.

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The Bigger, Macroeconomic Picture

Dysfunctional politics on Capitol Hill have once again taken center stage on Wall Street, as investors try to prepare themselves for the next round of political ping-pong coming in February. But while Washington will likely continue to weigh heavily on the markets, investors must be able to look at the bigger, macroeconomic picture.

Though U.S. data has been somewhat mixed in recent months, the overall economic landscape has improved tremendously since the financial crisis of 2008. The housing market has finally regained its footing, labor data has shown slow but positive growth, and consumers have started to regain confidence – all signs showcasing that the the U.S. economy is alive and kicking.

Do these figures mean the country won’t face major headwinds in the future? No, not at all. But for dividend investors, patience will go a long way. No matter which school of economic thought you align yourself with, there is no deny

Asian Stocks Retreat Ahead of Delayed U.S. Payrolls Data

Asian stocks fell, with regional benchmark index retreating from a five-month high, as investors await the release of delayed U.S. payrolls data to gauge when the Federal Reserve will starting trimming record stimulus.

China Mobile Ltd., the world's largest phone company, dropped 3.6 percent in Hong Kong after posting its biggest profit decline since 1999. Shinhan Financial (055550) Group Co. fell 3.2 percent in Seoul as BNP Paribas plans to sell part of its stake in South Korea's biggest bank. BHP Billiton Ltd., the world's No. 1 mining company, gained 2.5 percent in Sydney after increasing its forecast for iron-ore production.

The MSCI Asia Pacific Index fell 0.1 percent to 143.53 as of 12:44 p.m. in Tokyo, with nine of the 10 industry groups on the measure retreating. The gauge closed yesterday at the highest level since May 21 as investors shifted their focus from the resolution of the U.S. fiscal showdown to the timeline for the Fed reducing bond buying.

"There's a lack of catalysts," said Toshiyuki Kanayama, a senior market analyst at Monex Securities Inc. "Investors may be on the sidelines to see the U.S. jobs data."

China's Shanghai Composite Index (SHCOMP) lost 0.7 percent. Home prices climbed in August in 69 of 70 Chinese cities, according to data released by the government today.

Hong Kong's Hang Seng Index fell 0.5 percent. South Korea's Kospi index and Taiwan's Taiex both dropped 0.1 percent. Japan's Topix index gained 0.2 percent, while Singapore's Straits Times Index added 0.4 percent. Australia's S&P/ASX 200 Index (AS51) rose 0.5 percent and New Zealand's NZX 50 Index advanced 0.7 percent.

Relative Value

The MSCI Asia Pacific Index climbed 3.7 percent this month through yesterday as the U.S. Congress voted to end the government shutdown and raise the debt ceiling. The gauge traded at 13.8 times estimated earnings compared with 15.8 for the Standard & Poor's 500 Index and 14.7 for the Stoxx Europe 600 Index.

S&P 500 futures slid 0.1 percent today. The U.S. equity gauge rose less than 1 point in New York yesterday as investors watched corporate earnings to assess the strength of the economy before today's employment data.

The Labor Department report will probably show employers added 180,000 workers in September, the most since April, after a 169,000 gain in August, according to the median estimate of 93 economists surveyed by Bloomberg. The report, originally due Oct. 4, was delayed by the Oct. 1-Oct. 17 partial government shutdown.

Fed Stimulus

The Federal Reserve won't taper bond purchases until March because the shutdown probably slowed fourth-quarter U.S. growth and also interrupted the flow of data, according to economists in a Bloomberg survey. The monthly pace of asset buying will be pared to $70 billion from $85 billion at the Fed's March 18-19 meeting, the median of 40 estimates shows.

"It's a good environment for equities because tapering expectations have been pushed out to next year," Sean Fenton, a Sydney-based fund manager, who helps oversee about $1 billion at Tribeca Investment Partners Ltd., said by telephone. "We still see markets trending higher and there's nothing particular out there that's worrying us in the short term. Growth in the U.S. is steady without being spectacular, so the support remains from the Fed, with very easy monetary conditions."

China Mobile sank 3.6 percent to HK$82, heading for the lowest close since July 19. Net income fell 8.8 percent to 28.4 billion yuan ($4.7 billion) in the third quarter, according to figures derived from nine-month results released by the Beijing-based company yesterday. The profit missed the 31.1 billion-yuan average of five analyst estimates compiled by Bloomberg.

Shinhan Financial fell 3.2 percent to 47,100 won in Seoul. BNP Paribas, which owns 6.35 percent stake in Shinhan Financial, plans to sell part of its stake in a block sale, according to a term sheet obtained by Bloomberg News. The price likely to be set between 47,000 won to 48,650 won per share, according to the term sheet.

BHP Billiton gained 2.5 percent to A$37.11. The miner raised its full-year iron ore production forecast to 212 million tons from 207 million tons after output for the steelmaking material jumped 23 percent in the three months ended Sept. 30.

Can TIBCO Software Meet These Numbers?

TIBCO Software (Nasdaq: TIBX  ) is expected to report Q2 earnings on June 20. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict TIBCO Software's revenues will wane -0.2% and EPS will compress -30.8%.

The average estimate for revenue is $246.7 million. On the bottom line, the average EPS estimate is $0.18.

Revenue details
Last quarter, TIBCO Software reported revenue of $237.8 million. GAAP reported sales were 5.4% higher than the prior-year quarter's $225.7 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

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EPS details
Last quarter, non-GAAP EPS came in at $0.18. GAAP EPS of $0.06 for Q1 were 50% lower than the prior-year quarter's $0.12 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 69.0%, 170 basis points worse than the prior-year quarter. Operating margin was 8.1%, 270 basis points worse than the prior-year quarter. Net margin was 4.0%, 510 basis points worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $1.06 billion. The average EPS estimate is $1.04.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 522 members out of 548 rating the stock outperform, and 26 members rating it underperform. Among 135 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 130 give TIBCO Software a green thumbs-up, and five give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on TIBCO Software is outperform, with an average price target of $27.00.

Software and computerized services are being consumed in radically different ways, on new and increasingly mobile devices. Many old leaders will be left behind. Whether or not TIBCO Software makes the coming cut, you should check out the company that Motley Fool analysts expect to lead the pack in "The Next Trillion-dollar Revolution." Click here for instant access to this free report.

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What Is Citigroup's Secret Sauce?

Fellow Fools, operating under the assumption you can't properly evaluate a company as an investment if you don't know what makes that company tick, for the last few weeks we've been examining superbank Citigroup (NYSE: C  ) from top to bottom.

So far, we've looked at how Citi generates its revenue and how profitable it is. Today we're going to investigate what sets Citi apart from its peers to try to find out what its "secret sauce" is. Because every good investment has some angle or competitive edge that lets it stand out from the pack.

It's a small world, and a potentially profitable one
A look at Citi's first-quarter 2013 earnings supplement shows a surprising fact: The superbank generated $10.9 billion of its $20.5 billion in total revenue from overseas operations. That's 53.1%.

For the record, "overseas" means anything outside of North America, which Citi defines specifically as: EMEA (Europe, Middle East, Africa); Latin America; and Asia. In those geographical areas:

For Global Consumer Banking, Citi generated $4.9 billion in revenue overseas out of a total of $10.0 billion, or 49%. For Securities and Banking, Citi generated $4.0 billion in revenue overseas out of a total of $7.0 billion, or 57.1%. For Transaction Services, Citi generated $2.0 billion in revenue overseas out of a total of $2.6 billion, or 76.9%. 

This global capability and global reach in an undeniably global world is Citi's secret sauce. Even in the wake of the worldwide financial crisis, planet finance doesn't look like it's going to decouple anytime soon, and Citi is well positioned to make the most of it.

The competition
When it comes to international operations and revenue breakdowns, it's very hard to get apples-to-apples comparisons on specific numbers and metrics between two companies. This is because different companies report said numbers and metrics differently. And different business organize their lines of business differently.

Suffice it to say that both Bank of America (NYSE: BAC  ) and JPMorgan Chase (NYSE: JPM  ) both see themselves as global banks. And each in their own way are committed to competing globally. So Citi won't automatically have the world to itself.

In its first-quarter earnings press release, B of A specifically called out that "Global Wealth and Investment Management report[ed] record post-merger revenue, net income, and long-term assets under management." Total revenue from this line of business alone was a hearty $4.4 billion for the first quarter.  In its first-quarter press release, JPMorgan specifically called out that "Corporate & Investment Bank[ing] reported strong performance across products and maintained its #1 ranking for Global Investment Banking fees." 

Foolish bottom line
Every good company, and therefore every good investment, has a secret sauce: the thing that lets it stand out from the pack. From this Fool's perspective, Citi's secret sauce is its global reach, capability, and commitment. 53.1% of total revenue coming from overseas operations is a serious commitment. The connected world isn't going away, and Citi is going to be there to reap the ongoing rewards of this connectedness.

Though some countries may be trying hard to ring-fence their banking systems, to keep them safe from the kind of cross-border contamination that let America's bursting real-estate bubble infect the world's economy, the fact is, globalization is here to stay. Banks that get this -- and are putting their time, money, and resources into maximizing the related capabilities -- are here to stay as well. 

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Twitter IPO: Will Infamous Whale Picture Show Up?

While the Fail Whale Haunt the Upcoming Twitter IPO?

 

If you're familiar with Twitter (NASDAQ: TWTR) at all, you've probably seen the "fail whale" at least once or twice. This is the graphic of a large whale being carried aloft by a flock of small birds with the message "Twitter is Over Capacity" or something else explaining the problem. With the Twitter IPO on the horizon, some are wondering if the fledgling social media company will be able to do better than Facebook did back in 2012.

NYSE for IPO: Twitter is Not Facebook

When talking about the upcoming Twitter IPO the first thing you need to realize is that this social media company is not the same as Facebook (NYSE: FB). In fact, they're quite different. Upstart Business Journal has reported that Twitter is using the NYSE instead of NASDAQ for their Initial Public Offering.

Learning from Facebook's Mistakes

One of the things Twitter has going for them is that they were able to study Facebook's IPO closely. This has most likely given the company a better chance of not repeating mistakes the other social media company made. For example, Facebook (NYSE: FB) may have waited to long to have their IPO. This made it more difficult to show that they would have explosive growth after getting on the market.

Another mistake that Facebook made was setting their initial price so high. While they have finally moved past that early number, they were stuck in a rut for quite a while. If Twitter uses this to set their asking price more realistically, they may be able to do better right out of the gate.

Bumpy Road Ahead

While Twitter may have been able to study Facebook's IPO closely and can try to avoid some of the mistakes they made, they have other problems to worry about as well. One is that they recently reported their worst quarterly loss in three years. This is not good news when you're about to go public. Even worse, there's no real indication that Twitter has a solid plan to reverse the recent trends.

Twitter Q3 2013 numbers were negative $65 million, which is about three times the amount they were in the red in the same quarter in 2012, according to a report by ABC News. No mention of when the IPO - one of the most anticipated in a while - will happen or what the IPO price of the stock will be, but some think this information may be known before Thanksgiving this year.

At the same time, Twitter (NASDAQ:TWTR) has never said they were worried about monetizing their social media network too heavily. They've taken steps to sell their own ads and marketing to companies, but their native advertising hasn't been as successful as they had hoped. Still, looking at other numbers - like traffic - it's hard to see how they can continue to lose money for much longer.

The social media company hasn't had a profitable month since they started about eight years ago. To date they've lost close to $500 million. Monetizing their large network of users needs to be one of their priorities if they're going public. Whether or not this happens, however, is another story entirely.

Life After the Twitter IPO

Whatever happens on the market, life will undoubtedly continue after the Twitter IPO. Some people may make money by getting in early while others may lose money by trying to be too greedy. Either way, many signs point to the social media company having a successful IPO. And you can be sure many people will be writing about it all over the Internet.

Mashable has reported that Twitter is trying to act more like Google before and after their IPO rather than emulate Facebook. The tweet the company sent out immediately after their IPO announcement was one telling their employees to get back to work. In many ways, they see it as just another round of funding rather than a radical change in the way the company operates.

Having said that, the fact that Facebook (NYSE: FB) stock prices have been going up is good news for Twitter, which may be able to pull off an IPO that will go down in the history books.  And if not, maybe they can just throw up a billboard and run an ad campaign featuring their fail whale apologizing for not being able to handle the IPO.

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Markets Trading Ideas

  Around the Web, We're Loving... Learn to Use Trading Platforms Like Hedge Fund Traders do Rumsfeld: Denial of Benefits to Fallen Soldiers' Families 'Inexcusable' Come See How the Pro's Trade in this Exclusive Webinar Facebook, Baidu Lead Big Caps Beating Shutdown What Should You Know About AMZN? Most Popular UPDATE: SolarCity Confirms Pricing of 3.4M Share Offering at $46.54/Share Trouble Brewing Under the Hood For The S&P 500? UPDATE: J.P. Morgan Upgrades AMR Corporation on Likelihood of US Airways Merger Earnings Scheduled For October 17, 2013 iPhone 5C Selling Out From One Carrier (AAPL) Google Up 5% After Topping Estimates (GOOG) Related Articles () Anacor Pharmaceuticals Announces Award of $100M in Arbitration with Valeant Celanese Announces Asia Expansion of Polyacetal Manufacturing Footprint TigerLogic Clarifies MDMS Assets Being Divested to Rocket Software Rumors Continue To Circulate On BlackBerry; Latest Says Lenovo Signed NDA To See Books Benzinga's M&A Chatter for Thursday October 17, 2013 Twitter IPO: Will Infamous Whale Picture Show Up? View the discussion thread. Partner Network #marketfy-ae-block { display: none; border: 2px solid #0a3f75; overflow: hidden; width: 300px; height: 125px; text-align: center; background-color: #45719E; position: relative; z-index: 1; } #marketfy-ae-block a { display: block; width: 300px; height: 125px; position: relative; z-index: 2; color: #ffffff; text-decoration: none; } #marketfy-ae-block-countdown-text { color: #f9fc99; padding: 0px 0 0 0; font-size: 19px; font-weight: bold; line-height: 19px; } #marketfy-ae-block-countdown-text-start { font-size: 12px; } #marketfy-ae-block-countdown { padding: 5px 0 5px 0; font-size: 26px; } #marketfy-ae-block-signup { padding: 5px 47px; } #marketfy-ae-block-signup:hover { background-color: #457a1a; } #marketfy-ae-block #marketfy-ae-block-logo { display: block; padding: 3px 0 0 0; margin: 0; } #marketfy-ae-block-logo { text-indent: -9999px; } #marketfy-ae-block-free { display: block; position: absolute; top: 7px; right: -23px; width: 80px; height: 16px; line-height: 16px; text-align: center; opacity: 1; -webkit-transform: rotate(45deg); -moz-transform: rotate(45deg); -ms-transform: rotate(45deg); transform: rotate(45deg); font-size: 13px; font-weight: normal; color: #333333; background-color: yellow; z-index: 500; text-shadow: 1px 1px #999999; } #marketfy-ae-block-arrow { position: relative; width: 60px; height: 60px; z-index: 10; margin: -80px 0 13px -21px; } #marketfy-ae-block-arrow img { height: 60px; width: auto; } Marketfy's International
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The 11 Countries That Still Have Perfect Credit

A bipartisan deal was reached to end the government shutdown and raise the debt ceiling on Wednesday. While this provides immediate relief, the agreement is only a short reprieve. Funding to the government now ends January 15, and the debt ceiling will only be raised through February 7th.

This follows nearly two weeks of acrimonious debate in the House and Senate which triggered concern in the markets about downgrades by the major credit agencies. In fact, Fitch Ratings warned on Tuesday that it might downgrade U.S. debt amid fears Congress could not find a resolution to the raising the debt ceiling. Fitch and Moody's still assign the U.S. their top ratings (AAA and Aaa respectively); Standard & Poor's downgraded the U.S. to AA+ in August 2011.

Click here to see the countries with perfect credit

As of October 16, Fitch was alone with its downgrade warning. At the time, S&P spokesman John Piecuch told reporters that the agency's ratings reflected the potential that a deal could not be struck between Democrats and Republicans. In the last two years, three major countries have lost their top rating from at least one agency: the United States, the United Kingdom and France. In light of the Fitch warning, some have wondered what those few remaining AAA-rated countries have going for them. 24/7 Wall St. examined the 11 countries with perfect AAA ratings from all three ratings agencies.

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When determining a country’s debt rating, agencies consider several factors, including the country’s political climate. Most of the countries with AAA ratings have a stable political environment, something the U.S. can no longer exactly claim. Few of these countries have faced the bitter battle that was and may continue to be waged in the U.S. over federal spending and debt.

The countries with the highest credit ratings are wealthy economies, with high levels of GDP per capita. All 11 of these countries are in the top 25 for this figure. Luxembourg, by virtue of its growing financial services industry, generated GDP per capita income of nearly $78,000 2012, 50% greater than in the U.S.

U.S. government gross debt amounted to 102% of GDP in 2012, 11th highest in the world. On Some of the top-rated countries have relatively low debt to GDP, including Australia and Luxembourg, which had debt levels at 27% and 21% of GDP in 2012.

Having low debt to GDP, however, is not necessarily a sign of a stable economy. According to many economists, wealthy, stable countries are able to borrow significantly more than developing nations. For some countries, high debt is a sign of a healthy economy. Five of the AAA-rated countries had debt exceeding 50% of national GDP as of 2012.

To determine the countries that are higher rated than the U.S., 24/7 Wall St. reviewed credit ratings for sovereign countries published by Moody's, Fitch, and Standard & Poors (S&P). In order to make the cut, nations had to be awarded the highest possible credit rating from each institution– Aaa from Moody's, or AAA from S&P and Fitch. We excluded countries with very small economies, including the Isle of Man, Guernsey and Liechtenstein. Unemployment rates are from the Organisation for Economic Co-operation and Development, excluding Singapore, while further data on economic activity is largely from the IMF's World Economic Outlook.

A REIT Good Year for Land Securities Group

LONDON -- Shares of Land Securities  (LSE: LAND  )  rose more than 3% to 966 pence in early London trading this morning, as the U.K.'s largest real-estate investment trust (REIT) released annual results for the year ended 31 March 2013.

The group, which owns 8.7 million sq. ft. of office and retail space in London and 18.4 million sq. ft. of retail and leisure space across the rest of the U.K. reported that pre-tax profits were up 3.4% to 533 million pounds, while net asset value (NAV) per share increased 4.6% to 903 pence.

Highlights for the year included the addition of 932,000 sq. ft. of new retail space in Leeds and Glasgow, opening almost fully let in March, plus news that 56% of its new "Walkie Talkie" tower development in the City is already pre-let or in solicitors' hands, a year ahead of the building's completion.

Revenue profits dipped by 2.9%, as previously guided, coming in at 290.7 million pounds -- due to a reduction in non-recurring income and the impact of selling investment properties ahead of finding new buying opportunities.

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The first phase of construction at Victoria Circle in London's West End (a joint 700 million-pound venture with Canada Pension Plan Investment Board) is due to begin in June.

The board recommended a final dividend of 7.6 pence, taking the total for the year up to 29.8 pence per share -- a 2.8% increase.

Commenting on the results, chief executive Robert Noel said:

We went into the year with a clear plan. In London, we prioritised development over property investment, as we continued to believe this would generate substantially higher returns at this point in the cycle. In Retail, we focused on delivering our big schemes, increasing our exposure to the leisure sector and finding new ways to respond to retailers' changing needs.

This activity led to robust financial and operational results. Total Business Return was 8%. Revenue profit at £290.7m and adjusted diluted earnings per share at 36.8p were better than we expected at the beginning of the year. And we managed our void levels well, reducing them from 2.8% to 2% on a like-for-like basis.

With Land Securities shares currently trading at over a 60 pence premium to their NAV and a forward P/E of 24.3, only you can decide whether they represent a buy at this price. Indeed, broker opinion remains divided: eight brokers currently rating the shares a strong buy and nine as a hold.

But if you already own Land Securities shares and are looking for other opportunities, this exclusive wealth report reviews five particularly attractive possibilities.

Just click here for the report -- it's free.

2 Reasons to Believe Tony Stark Would Buy Oracle Stock

Watch Iron Man 3 closely enough and you'll find two references to Oracle (NYSE: ORCL  ) , the database giant that's had trouble diversifying into hardware. Will associating with a billionaire computer genius -- even a fictional one -- aid sales? CEO Larry Ellison seems to think so.

The first time Oracle appears in the film, Tony Stark asks computer assistant J.A.R.V.I.S to help him narrow a national search for clues to a crime, after which the Paul Bettany-voiced system responds that it had "engaged the Oracle cloud." The second time, a "Sun-Oracle" sign appears above Stark as he prepares to reconfigure the Internet signal of a satellite truck.

We've seen this before: Ellison appears as himself early in Iron Man 2. And why not? Ellison, like Stark, is a brash billionaire heading a tech empire. The difference is that Oracle is taking risky bets to overcome stiff competition from salesforce.com (NYSE: CRM  ) in the cloud and Cisco (NASDAQ: CSCO  ) in networking gear. Enjoy the hype, but don't be too quick to buy Oracle stock, says Fool contributor Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova.

Do you agree? Watch the video to get Tim's full take and then tell us what you thought of Iron Man 3 and whether you would buy, sell, or short Oracle stock at current prices.

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Starbucks Squeezing its Way into a Larger Market Share of the Fresh Juice Craze (SBUX)

Coffee giant Starbucks (NASDAQ: SBUX) has never been shy about keeping a spare finger on the public's pulse.

The company's been quick to capitalize on the current government shutdown. President CEO Howard Schultz announced that, for part of this week, when a Starbucks customer buys someone else their favorite beverage, the company will give that customer a free tall coffee in return.

 

The campaign, he said, is to help people support and connect with each other, “even as we wait for our elected officials to do the same for our country.”

 

And Starbucks is tapping into another trend that's apparently on many consumer's minds – a growing interest in fresh juice beverages.The company notes the shift by many customers away from old-school colas and carbonated soft drinks to supposedly healthier fresh juice drinks has evolved into a $1.6 billion business.

 

The Los Angeles Times, meanwhile, quotes data from the IBISWorld research group; that the overall juice industry, worth nearly $23 billion, has grown on average by 4.3 percent over the past five years – with the market expected to rise by another 6.8 percent yearly for the next five years.

 

On Wednesday, Starbucks officially opened its new, $70 million, 264,000 square foot “juicery” outside of Los Angeles – which will allow the company to dramatically increase production of its Evolution Fresh beverages. A company press release notes that, since acquiring Evolution Fresh in late 2011, the brand has “exceeded its aggressive growth plans to be in more than 8,000 Starbucks and grocery retailers by the end of calendar year 2013.”

 

And while nutritionists and organizations like the Mayo Clinic may dispute claims of greater health benefits from juicing fruits and vegetables, consumers apparently like what they're drinking.

 

The fresh juice trend is also making its way across the wide spectrum of retail demographics. As you might expect, Whole Foods Markets (NASDAQ: WFM) has juice bars at many of its locations. But last year, Dunkin' Brands (NASDAQ: DNKN) announced a partnership with Coca-Cola (NYSE: KO) to make the beverage giant's juice products – along with other soft drinks and energy drinks – available at its restaurants. And earlier this year Dunkin' Brands launched its own line of “not-from-concentrate orange juice” at its chain stores.

 

Business is also good, apparently, for stand-alone juice companies, On Monday, Jamba Juice (NASDAQ: JMBA) announced its “express smoothie units” are now open in over 1,000 food courts across the country – bringing its expansion to over 1,800 units. The company also expects its international market to grow from the current four countries to up to nine by the end of 2015.

Posted-In: beverages Evolution Fresh Howard Schultz IBISWorld soft drinksEarnings News Movers & Shakers Commodities Retail Sales Restaurants Markets General Press Releases Best of Benzinga

(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

  Around the Web, We're Loving... Learn to Use Trading Platforms Like Institutional Traders do Rumsfeld: Denial of Benefits to Fallen Soldiers' Families 'Inexcusable' Facebook, Baidu Lead Big Caps Beating Shutdown What Should You Know About AMZN? Most Popular These Four Story Stocks Got Beat Up Tuesday (TSLA, LNKD, NFLX, FB) Short Sellers Pile On Facebook and Google (FB, GOOG, ZNGA) Apple Should Have 'Immediately' Apologized For iPhone Blunder Keeping an Eye on the Four 'New' Horsemen of Tech Gmail Down Again For Some Users (GOOG) Apple's iPad 5 Event To Crash Surface Release Party On October 22 Related Articles (JMBA + DNKN) Starbucks Squeezing its Way into a Larger Market Share of the Fresh Juice Craze (SBUX) Morning Market Losers Benzinga's Top Downgrades Stocks To Watch For October 8, 2013 Dunkin' Donuts to Open 27 New SoCal Restaurants in Central, Northern Inland Empire, Northern Orange County, with Embassy Suites US Stock Futures Mostly Flat; Jobless Claims Data In Focus View the discussion thread. Partner Network #marketfy-ae-block { display: none; border: 2px solid #0a3f75; overflow: hidden; width: 300px; height: 125px; text-align: center; background-color: #45719E; position: relative; z-index: 1; } #marketfy-ae-block a { display: block; width: 300px; height: 125px; position: relative; z-index: 2; color: #ffffff; text-decoration: none; } #marketfy-ae-block-countdown-text { color: #f9fc99; padding: 0px 0 0 0; font-size: 19px; font-weight: bold; line-height: 19px; } #marketfy-ae-block-countdown-text-start { font-size: 12px; } #marketfy-ae-block-countdown { padding: 5px 0 5px 0; font-size: 26px; } #marketfy-ae-block-signup { padding: 5px 47px; } #marketfy-ae-block-signup:hover { background-color: #457a1a; } #marketfy-ae-block #marketfy-ae-block-logo { display: block; padding: 3px 0 0 0; margin: 0; } #marketfy-ae-block-logo { text-indent: -9999px; } #marketfy-ae-block-free { display: block; position: absolute; top: 7px; right: -23px; width: 80px; height: 16px; line-height: 16px; text-align: center; opacity: 1; -webkit-transform: rotate(45deg); -moz-transform: rotate(45deg); -ms-transform: rotate(45deg); transform: rotate(45deg); font-size: 13px; font-weight: normal; color: #333333; background-color: yellow; z-index: 500; text-shadow: 1px 1px #999999; } #marketfy-ae-block-arrow { position: relative; width: 60px; height: 60px; z-index: 10; margin: -80px 0 13px -21px; } #marketfy-ae-block-arrow img { height: 60px; width: auto; } Marketfy's International
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Expansion and Acquisitions in the Gas Industry

Investors are very often turned off by a cyclical business. Nonetheless, such behavior gives investors the chance to take a position in a profitable business model at a low entry price. With a recent boom in the U.S. market, prices are not expected to be in the low end. Let us look at AGL Resources (GAS) and Suburban Propane (SPH) to see whether any of them offer a profitable business model at a low entry price.

Intelligent, Less Risky Acquisition

Hit by adverse weather and merger expenses during 2012, AGL Resources continues to recover from an abnormal 2012. Also, its storage facilities and marketing business was affected by the change in gas flows generated by developments in the Marcellus shale. The acquisition of Nicor Gas is also thought to have reduced the company's competitiveness. In line, the business model is considered to be a healthy cash producer albeit minor adjustments are required.

AGL Resources' latest acquisition was criticized because it shot the company's valuation to the top rankings, reducing the interest shown by prospective investors'. On the upside, the operations gave the firm a new opportunity to expand geographically. Additionally, the firm turned into the largest pure gas distributor, with access to eight interstate pipeline connections. On top of it all, the business continues to operate at one of the lowest production costs.

Future prospects for AGL Resources are also fed by a range of retail energy-related products and services, natural gas wholesale marketing, and other gas supply management services. The contribution made by these segments continues to improve, and is expected to do so for the long-term. Services are further pushed by the firm's safety and reliability record.

Like the competition, AGL Resources' customers face high switching costs due to unavailable energy alternatives, and propane-ready appliances. However, in order to secure profits in the long-term, stable prices and favorable weather is required because capti! ve clients' consumption is sensitive to price hikes and weather changes.

AGL Resources is financially moderate because debt has risen considerably and cash flow stood at precious levels. The stock is trading at 17.2 times its earnings, or a 20% discount to the industry average. I feel bearish about the stock because the US gas boom has past. Also, gurus have not been moving much on this stock. The last two transactions on the stock are Steven Cohen and Jim Simmons option out.

Acquisitions Are Not Enough

Suburban Propane expanded into new geographies looking to increase revenue and profits. However, the business strategy did not turn out as expected. On one hand, operated volumes improved thanks to the Inergy acquisition. But, future outlook remains obscure by the incremental losses per distributed unit. Hence, the overall balance of the acquisition does not offer a positive future outlook.

As with AGL Resources' customers, Suburban Propane´s are pretty much captive for the same reasons: ready appliances and no alternative energies. Hence, customers control consumption levels very warily, and respond strongly to price and weather changes.

For the third quarter, results include a one-time $6 million charge concerning merging costs. It is worth noting that Suburban Propane annually reports losses on the third quarter due to propane purchases to replenish inventory to face rising summer demands. Hence, performance should improve at least slightly when compared to previous quarters.

Additionally, cost efficient policies have helped to improve Suburban Propane´s performance. However, the strategy seems to have reached exhaustion. Employees have been stretched to their fullest through dismissal and retirement, the distribution fleet has adjusted to current needs, and low profit customers were dropped. In the near future, improvements seen during the last six years will be hard to replicate, and rising costs per unit are the telling evidence.

Suburban Propane´s b! alance sh! eet is moderate, especially due to a declining cash flow. The stock currently trades at 32.5 times its earnings, packing a 51% premium to the industry average. I remain bearish about the future prospects of the company since acquisitions have not significantly improved performance. Last, the largest guru holding a position, Jean-Marie Evelliard, does not register changes since September of last year, and the last transaction is Jim Simons option out.

Closing Thought

I feel bearish about bot stocks but prefer AGL Resources because it pays a higher dividend, and acquisitions have improved performance. In comparison to competitors, the firm has been able to increase market share without having to expand into new and risky geographies. However, I would like to wait until the issues concerning expansion into Illinois are resolved.

Disclosure: Jodor Jalit holds no position in any of the mentioned stocks.

Retailers see modest September sales gains

NEW YORK — Several U.S. retailers reported modest sales gains for September as shoppers who were worried about a partial government shutdown and the overall economy pulled back their spending from the prior month.

The results increase concerns about how shoppers will spend for the crucial holiday season, the largest shopping selling period for retailers.

Revenue at stores opened at least a year — a measure of a retailer's health— rose 2.7% in September, according to a preliminary tally of 9 retailers by the International Council of Shopping Centers. That was a slower pace than the 3.5% increase posted in August.

L Brands, the parent of Victoria's Secret, and Costco Wholesale Corp. were among the chains that reported results that missed Wall Street estimates, while Stein Mart Inc. posted results that beat analysts' expectations.

Only a sliver of retail chains report monthly sales figures, and the list doesn't include Wal-Mart Stores, Macy's Inc. and many other large chains. But it offers some clues into consumer spending heading into the holiday shopping season.

L Brands, the parent of Victoria's Secret, reported that revenue at stores opened at least a year rose just 1% in September, below the 2% gain that analysts polled by Thomson Reuters expected. Costco Wholesale Corp. reported Wednesday that revenue at stores opened at least a year rose 3%, below the 3.7% gain that was anticipated by Wall Street.

September was a difficult month. Warmer-than-usual weather hurt sales of sweaters and other fall clothes. But economic concerns also dampened sales.

Shoppers worry that the partial government shutdown, which is on its tenth day and has forced about 800,000 federal workers off the job, will be prolonged. That, and the possibility that politicians won't resolve their deadlock over the federal debt limit before the U.S. Treasury's borrowing authority is exhausted next week, adds to the concerns. A financial default could plunge the economy into recession, cause i! nterest rates to increase and home values to drop.

Those worries compound challenges retailers have had in trying to get shoppers spending again. The job and housing markets are improving, but that hasn't yet translated into sustained spending increases among most shoppers.

Americans Don’t Know Who to Trust on Money Matters: TIAA-CREF Survey

Nearly half of Americans in a survey released Tuesday said it was hard to know which sources of financial advice could be trusted.

Respondents in TIAA-CREF’s second annual Financial Advice Survey also pointed to perceived cost and lack of time as factors that prevented them from seeking advice.

Key findings from the survey showed the following:

KRC Research conducted the telephone survey among a national random sample of 1,000 adults, age 18 years and older, between Aug. 28 and Sept. 2.

Survey results for 2013 also revealed notable differences in the perception of financial advice and management among different segments of the population.

The Gen X segment (ages 35 to 44) led all age groups in seeking advice on retirement, with 80% of those who sought financial advice looking for more guidance. Gen Xers were also the largest segment to rely on financial service provider websites or online tools for financial advice.

The Gen Y segment (ages 18 to 34) was most likely to say it was a little or not at all informed about retirement planning, with 43% claiming they lacked information. Unsurprisingly, Gen Yers were the most likely segment to focus on managing student loans and to rely on friends and family for financial advice.

Fifty-six percent of women in the new survey said they were confident they were saving enough for retirement, compared with 65% of men who were confident. Women continued to rely more on friends and family for financial advice, while men gravitated toward financial service provider websites and online tools.

Eighty-seven percent of respondents 55 to 64 said they were informed about retirement planning, and 85% said they acted on the financial advice they received some or most of the time. Indeed, 53% who received financial advice said they had increased their retirement savings contributions.

TIAA-CREF said this year’s survey found notable changes in the kinds of advice Americans sought from financial advisors, compared with 2012 survey results.

In 2013, 63% of Americans who received financial advice wanted information on saving for retirement, versus 52% in 2012. And 54% who received advice said they were looking for how to make their retirement savings last, a nine percentage-point increase over 2012.

In 2013, 40% of Americans sought education-related financial advice, compared with 30% who did in 2012.

Respondents liked financial advice and tools designed specifically for different groups. Forty percent of those seeking advice used financial service provider websites or online tools to find information, a more than a 15 percentage-point increase from 2012.

Forty-seven percent said it would be helpful to receive financial advice through webinars, 46% through live seminars and 45% through interaction with someone online.

---

Check out The Most Important Ratio in HNW Retirement Planning on ThinkAdvisor.

Top Low Price Companies To Own For 2014

It really shouldn't matter a lick what price a stock is trading at. There is no fundamental difference between a stock with 1 million shares trading at $50 and a stock with 10 million shares trading at $5.

Then again, there are people whose interest is piqued when they see a low price tag. It's one of the reasons why many companies will split their stock. The lower price tag will sometimes entice more buying.

 

When you consider the rule of large numbers, the phenomenon of lower-priced stocks rising faster than their higher-priced brethren does make a little sense. After all, for a stock trading at $5 to gain 50%, it has to only rise $2.50. But for a $100 stock, the same move takes $50.

Investors aren't always rational, and that $2.50 move seems a lot smaller than a $50 rise, even though they are the exact same in percentage terms.

Top Low Price Companies To Own For 2014: The Pantry Inc.(PTRY)

The Pantry, Inc. operates a chain of convenience stores in the southeastern United States. The company?s stores offer a selection of merchandise, fuel, and ancillary products and services. Its merchandise products include cigarettes, grocery and other tobacco products, packaged beverages, beer, and wine. The company operates stores under various selected banners, which primarily include Kangaroo Express. As of September 29, 2011, it operated 1,649 convenience stores located in Florida, North Carolina, South Carolina, Georgia, Alabama, Tennessee, Mississippi, Virginia, Kansas, Kentucky, Louisiana, Indiana, and Missouri; and 233 quick service restaurants. The company was founded in 1967 and is headquartered in Cary, North Carolina.

Advisors' Opinion:

• [By Sean Williams]

  Much of the same can be said about The Pantry (NASDAQ: PTRY  ) , a predominantly Southeastern U.S. convenience store chain that operates under the Kangaroo Express name. Food inflation has been minimal, the weather hasn't been as cooperative, and consumer traffic fell 4.6% in its most recent quarter. But where other investors see weakness, I see an opportunity.

• [By Geoff Gannon]

  For one thing, I can�� tell a great oil company from a not so great oil company. I can�� evaluate the company�� culture, management, etc. There was no way I was ever going to answer questions like that. But I can easily split Murphy�� U.S. retail business from its other operations. And I can compare that part of the company to other public companies like Pantry (PTRY) and Susser (SUSS). I can also ��this is much harder ��look at Murphy�� reserves and compare them to other oil companies��reserves. The SEC now requires a standardized way of reporting discounted net cash flows for all oil companies. So, there�� certainly a specific number available for every company. Whether it�� a very good number or not depends on the assumptions the method uses.

Top Low Price Companies To Own For 2014: Key Technology Inc.(KTEC)

Key Technology, Inc., together with its subsidiaries, designs, manufactures, and sells process automation systems in the United States and internationally. The company offers automated inspection systems, including Manta, an on-belt sorter; Tegra that inspects products in-air using cameras configured in a tilted-X geometry to look in oblique angles; Optyx; Tobacco Sorters 3 tobacco sorting systems for use in tobacco threshing and processing; ADR automatic defect removal systems for the potato strip industry; and Optyx SG and VeriSym for the pharmaceutical and nutraceutical industries, as well as provides various line solutions. It also offers conveying and process systems to move and process product within a production plant. The company?s conveying and process systems comprise Iso-Flo vibratory conveying systems; Impulse, a vibratory conveyor; SmartArm, a wireless performance monitoring system for Iso-Flo vibratory conveyors; horizontal motion conveyors; rotary sizing an d grading systems for food processing and fresh vegetable packing operations; preparation systems to prepare a range of food products prior to cooking, freezing, canning, or other types of processing; fresh-cut systems for the fresh-cut produce industry; and SYMETIX equipment for pharmaceuticals and nutraceuticals. In addition, it provides standard and custom designed equipment that conveys, dewaters, transfers, distributes, aligns, feeds, meters, separates, grades, blanches, cooks, pasteurizes, cools, cleans, washes, dries, polishes, and packages products. Further, the company offers spare parts, and post-sale field and telephone-based repair services; and RemoteMD, a condition analysis tool for G6 optical sorters and G6 ADR automatic defect removal systems, as well as provides online training programs. It sells its products directly, as well as through independent sales representatives. The company was founded in 1948 and is headquartered in Walla Walla, Washington.

Top 10 Clean Energy Companies For 2014: Virginia Mines Inc (VGQ.TO)

Virginia Mines Inc. engages in the acquisition, exploration, development, and exploitation of various mining exploration properties in Canada. The company primarily explores for gold and base metal deposits primarily in James Bay area, Quebec. It has a strategic alliance with Wemindji Exploration Inc. to carry out geological reconnaissance, sampling, and exploration work in middle north Quebec; and KGHM International Ltd. to carry out geological reconnaissance, sampling, and exploration work in northern Quebec. The company is headquartered in Quebec, Canada. As of March 31, 2006, Virginia Mines Inc. operates as a subsidiary of Goldcorp Inc.

Top Low Price Companies To Own For 2014: Astro-Med Inc.(ALOT)

Astro-Med, Inc. designs, develops, manufactures, distributes, and services various products that acquire, store, analyze, and present data in multiple formats. It operates in three segments: Test & Measurement (T&M), QuickLabel Systems (QuickLabel), and Grass Technologies (Grass). The T&M segment provides a suite of telemetry recorder products for the aerospace and defense industries, as well as portable data acquisition recorders, which offer diagnostic and test functions to a range of manufacturers, including automotive, energy, paper, and steel fabrication. It also offers a suite of ruggedized printer products for military and commercial applications for use in the avionics industry to print weather maps, communications, and other critical flight information. The QuickLabel segment provides hardware, software, and media products that create on demand color labels, and store and produce images in color or non-color formats on various media substrates. Its products compri se digital color label printers; labeling software; label and tag substrates; label printing inks; custom label printing services; and printer accessories. The Grass segment produces diagnostic and monitoring products that serve the clinical neurophysiology markets, as well as a range of biomedical instrumentation products and supplies focused on the life sciences markets. Its product line consists of neurophysiological recording instruments, software, stimulators, electrode preps, consumable products, and electrodes. The company serves aerospace, apparel, automotive, avionics, chemicals, computer peripherals, communications, distribution, food and beverage, general manufacturing, life sciences, packaging, and transportation markets. Astro-Med, Inc. markets its products through sales personnel, manufacturing representatives, and dealers in the United States, Europe, Canada, Asia, and Central and South America. The company was founded in 1969 and is headquartered in West Warw ick, Rhode Island.

Top Low Price Companies To Own For 2014: Xinyuan Real Estate Co Ltd(XIN)

Xinyuan Real Estate Co. Ltd., together with its subsidiaries, engages in residential real estate development in China. The company?s residential projects comprise various residential buildings that include multi-layer apartment buildings, sub-high-rise apartment buildings, or high-rise apartment buildings; auxiliary services and amenities, such as retail outlets, leisure and health facilities, kindergartens, and schools; and small scale residential properties. It also offers property management and other real estate related services, such as landscaping and installing intercom systems. In addition, the company leases properties, including an elementary school, a basement, three clubhouses, five kindergartens, and parking facilities. As of December 31, 2010, it had 21 completed projects with a total gross floor area (GFA) of approximately 2,049,460 square meters and comprising a total of 23,324 units, as well as 8 projects under construction with a total GFA of 1,804,946 sq uare meters. It primarily operates in seven tier II cities, comprising Hefei, Jinan, Kunshan, Suzhou, Zhengzhou, Xuzhou, and Chengdu. The company was founded in 1997 and is headquartered in Beijing, the People?s Republic of China.

Advisors' Opinion:

• [By Tim Brugger]

  Having completed the repurchase of approximately $12.6 million of the $20 million share buyback program started last year, Xinjuan Real Estate's (NYSE: XIN  ) board of directors has authorized the repurchase of an additional $60 million of outstanding stock, the company announced today.

BIOLASE is Ready to Boil Again (BIOL)

Looking for a quick, high-odds bullish trade? Then look for further than BIOLASE Inc. (NASDAQ:BIOL). This small medical equipment company has had nothing less than a miserable 2013, falling from a peak above $6.00 in April to a multi-year low of $1.16 on Wednesday. But, the size and scope of that plunge from BIOL has also dropped all the tell-tale hints that a rebound is nigh.

A little background... most of the 80% pullback from BIOL over the past three months has stemmed from concerns over the lack of liquidity, and the ensuing likelihood that dilutive fund-raising was inevitable. Sure enough, BIOLASE Inc. confirmed it would be raising money - a lot of it - a few days ago, accelerating the selloff it was already suffering due to a slow sales start with some of its equipment in the first half of the year.

A funny thing happened on the way to disaster, however - the sellers overshot.

There are actually two things going on here that point to bullishness for BIOLASE in the near future. One of them is the fact that the planned fund-raising is only going to be about 15% the size of the finding that was originally suggested. Yet, even with that minimal amount now being raised ($5 million), that should be enough to make a dent, buy enough time for BIOL to garner a little more sales traction, and end up working its way out of a tight fiscal situation.

The second clue suggesting BIOL is ready to swing back into a bullish trend seems to coincide with the good news that the dilution will be far less than first anticipated, though the timing is coincidental (probably).

The technical term is capitulation. In layman's terms, things have gotten as bad as they can get for BIOLASE shares. The stock's been hammered over the past five trading sessions, on high volume, telling us that plenty of shareholders have been getting out as quickly as they could. In retrospect, they were getting out too fast, and too zealously. They overdid it, and now BIOL is more than oversold - and ripe for a rebound - as a result. 

To be clear, the likelihood of a strong reversal here doesn't make BIOL a long-term buy. This is just a short-term call designed to take advantage of a short-term mistake the market collectively made. But, boy what an opportunity it is. While normally steering clear of excessively-strong moves is prudent, this is a case where the recent drubbing has been so horrific, there's a ton of room (as in triple-digits) to recover. It may not pay to be penny-wise and pound-foolish here.

Would you like to get more trading ideas and insights like this one? Sign up for the free daily SmallCap Network newsletter today. You'll get stock picks, market calls, and more.
 

An Introduction To Structured Products

Once upon a time, the retail investment world was a quiet, rather pleasant place where a small, distinguished cadre of trustees and asset managers devised prudent portfolios for their well-heeled clients within a narrowly defined range of high-quality debt and equity instruments. Financial innovation and the rise of the investor class changed all that.

One innovation that has gained traction as an addition to retail and institutional portfolios is the investment class broadly known as structured products. Structured products offer retail investors easy access to derivatives. This article provides an introduction to structured products with a particular focus on their applicability in diversified retail portfolios.

What Are Structured Products?
Structured products are designed to facilitate highly customized risk-return objectives. This is accomplished by taking a traditional security, such as a conventional investment-grade bond, and replacing the usual payment features (e.g. periodic coupons and final principal) with non-traditional payoffs derived not from the issuer's own cash flow, but from the performance of one or more underlying assets.

The payoffs from these performance outcomes are contingent in the sense that if the underlying assets return "x," then the structured product pays out "y." This means that structured products closely relate to traditional models of option pricing, though they may also contain other derivative types such as swaps, forwards and futures, as well as embedded features such as leveraged upside participation or downside buffers.

Structured products originally became popular in Europe and have gained currency in the U.S., where they are frequently offered as SEC-registered products, which means they are accessible to retail investors in the same way as stocks, bonds, exchange traded funds (ETFs) and mutual funds. Their ability to offer customized exposure, including to otherwise hard-to-reach asset classes and subclasses, makes structured products useful as a complement to these other traditional components of diversified portfolios.

Looking Under the Hood
Consider the following simple example: A well-known bank issues structured products in the form of notes, each with a notional face value of $1,000. Each note is actually a package consisting of two components - a zero-coupon bond and a call option on an underlying equity instrument, such as a common stock or perhaps an ETF mimicking a popular stock index like the S&P 500. Maturity is in three years. Figure 1 represents what happens between issue and maturity date.

Figure 1

Although the pricing behind this is complex, the principle is fairly simple. On the issue date you pay the face amount of $1,000. This note is fully principal-protected, meaning that you will get your $1,000 back at maturity no matter what happens to the underlying asset. This is accomplished via the zero-coupon bond accreting from its original issue discount to face value.

For the performance component, the underlying asset, priced as a European call option, will have intrinsic value at maturity if its value on that date is higher than its value when issued. You earn that return on a one-for-one basis. If not, the option expires worthless and you get nothing in excess of your $1,000 return of principal.

Custom Sizing
In the example above, one of the key features is principal protection. In another instance, an investor may be willing to trade off some or all of this protection in favor of more attractive performance features. Consider another case. Here, an investor trades the principal protection feature for a combination of performance features.

If the return on the underlying asset (R asset) is positive - between zero and 7.5% - the investor will earn double the return (e.g. 15% if the asset returns 7.5%). If R asset is greater than 7.5%, the investor's return will be capped at 15%. If the asset's return is negative, the investor participates one-for-one on the downside (i.e. no negative leverage). There is no principal protection. Figure 2 shows the option payoff chart for this scenario.

Figure 2

This strategy would be consistent with a mildly bullish investor's view - one who expects positive but generally weak performance and is looking for an enhanced return above what he or she thinks the market will produce.

Over the Rainbow
One of the principle attractions of structured products for retail investors is the ability to customize a variety of assumptions into one instrument. For example, a rainbow note is one that offers exposure to more than one underlying asset. A lookback is another popular feature. In a lookback instrument, the value of the underlying asset is based not on its final value at expiration, but on an average of values taken over the note's term, for example monthly or quarterly. In the options world, this is also called an Asian option to distinguish it from the European or American option. Combining these types of features can provide attractive diversification properties.

A rainbow note could derive performance value from three relatively low-correlated assets; for example, the Russell 3000 Index of U.S. stocks, the MSCI Pacific ex-Japan index and the Dow-AIG commodity futures index. Attaching a lookback feature to this could further lower volatility by "smoothing" returns over time.

What About Liquidity?
One common risk associated with structured products is a relative lack of liquidity due to the highly customized nature of the investment. Moreover, the full extent of returns from the complex performance features is often not realized until maturity. Because of this, structured products tend to be more of a buy-and-hold investment decision rather than a means of getting in and out of a position with speed and efficiency.

A significant innovation to improve liquidity in certain types of structured products comes in the form of exchange-traded notes (ETNs), a product originally introduced by Barclays Bank on June 12, 2006. These are structured to resemble ETFs, which are fungible instruments traded like regular common stock on a securities exchange. ETNs are different from ETFs, however, as they consist of a debt instrument with cash flows derived from the performance of an underlying asset - in other words, a structured product. ETNs can provide access to hard-to-reach exposures, such as commodity futures and the Indian stock market.

Other Risks and Considerations
In addition to liquidity, one risk associated with structured products is the issuer's credit quality. Although the cash flows are derived from other sources, the products themselves are legally considered to be the issuing financial institution's liabilities. They are typically not, for example, issued through bankruptcy-remote third-party vehicles in the way that asset-backed securities are. The vast majority of structured products are from high investment-grade issuers only - mostly large global financial institutions such as Barclays, Deutsche Bank or J.P. Morgan Chase. However, during a financial crisis, some structured products have the potential of losing principals to investors, similar to the risks involved with options. For that matter, the U.S. Financial Industry Regulatory Authority (FINRA) suggests that firms "consider" whether purchasers of some or all structured products be required to go through a similar approval process, so that only accounts approved for options trading would also be approved for some or all structured products.

Another consideration is pricing transparency. There is no uniform standard for pricing, making it harder to compare the net-of-pricing attractiveness of alternative structured product offerings than it is, for instance, to compare the net expense ratios of different mutual funds or commissions among broker-dealers. Many structured product issuers work the pricing into their option models so that there is no explicit fee or other expense to the investor. On the flip side, this means that the investor can't know for sure what the implicit costs are.

Conclusions
The complexity of derivative securities has long kept them out of meaningful representation in traditional retail (and many institutional) investment portfolios. Structured products can bring many of the benefits of derivatives to investors who otherwise would not have access to them. As a complement to more traditional investment vehicles, structured products have a useful role to play in modern portfolio management.

If Vringo Was Really the Slam Dunk it Was Supposed to Be... (GOOG, VRNG)

I'll be honest... I would have thought by now that the Vringo, Inc. (NASDAQ:VRNG) saga - the patent lawsuit brought against Google (NASDAQ:GOOG) and some of its partners - would have fallen off the radar by now as the market lost interest. On the other hand, I also would have thought by now that the trial would have been completed in its entirety by now. We're close to an end (less the appeal, if Vringo decides it needs to go through with it, or if Google decides to make an appeal of its own); we learned in mid-August the court intends to accept responsive/rebuttal briefs through November 10th, and may after that schedule any evidentiary hearings. But, those hearings will only be held if needed. Soon after that, we'll hear what most have been waiting for nearly two years now ... the actual size of the check that Google will need to write to Vringo Inc.

I'm not going to get into the merits of each side's legal battle. The parties on both sides of that table are entrenched, and not interested in being open minded to - or even hearing - opposing arguments, so explaining my stance would be a waste. I will, however, point out a couple of things about where and how these arguments (mostly the supportive, 'pro' arguments in support of VRNG) are being made ... they're all from Seeking Alpha.

For those not familiar, Seeking Alpha is an open platform for professional and amateur stock-market writers. As such, some of the commentaries there are very good, and some are bad, and many are somewhere in between. Likewise, though the site's editors work to ensure what's being said by all its contributors is accurate and documented, when the debate is as complex and confusing as much as the Google/Vringo battle has been, most anything can be posted as the site.

Now, I don't say that to be critical of Seeking Alpha. I say that mostly to point out that no other media source outside of the occasional mention at the Motley Fool's similar blogging platform (with slightly more-vetted contributors) are even talking about it' the mainstream media sources like AP or Reuters aren't even touching the story any longer. The fact that it's nothing but individual amateur investors banging the drum should be worrisome, just because most investors end up being proven wrong most of the time especially when they're most sure they're right.

There's quantitative evidence to add to the qualitative evidence that only a small number of Vringo fans (and presumably shareholders) are creating a very loud noise here... a noise that's loud enough to make it seem like the bullish Vringo arguments actually make a lot of sense. That is, even with all the convincing arguments in place saying the company is assured a nine-figure a payout from Google, only about 10% of the stock's float is held by institutions. The rest are held by individual investors. Normally, about 2/3 of a company is owned by institutional investors. Why the disparity? Because the risk here is too great.

While the knee-jerk response might be to say that the reward still justifies a risk that institutions can't take, it wouldn't be an accurate response. There are plenty of hedge funds and money managers that take greater risks all the time, for a lot less reward. The lack of institutional participation here seems to be saying there's just not a lot of upsode to look forward to.

Finally, if nothing else, this may be a case where we want to trust what the chart of VRNG is telling us. And what its gradual deterioration is telling us (as the proverbial D-Day approaches) is that more and more of the very same individual investors who've been buying it since April have been selling it since August despite the fact that we've now got more clarity on the trial's end-date (and completion) than we've ever had. If it's such a slam dunk, why have Vringo shares slumped from a high of $3.90 two months ago to the current price of $2.73, and why are they knocking on the door of a HUGE technical support level at $2.65

It's possible the final ruling from the court could surprise everyone, and send the stock to the stratosphere. It's certainly happened before with other stocks. But, with those other stocks, the back-stories were poorly understood, and largely unknown. The Vringo/Google was has been under everyone's microscope and in everyone's face for nearly two years now, so it's not like we haven't had time to fully handicap the odds here. The chart's clues and the fact that nobody but the bulls over at Seeking Alpha (the amateur investor's only real public "voice") should be seen as something of a red flag.

In other words, there's an uneasy "do as I say, not as I do" quality about the whole thing. Just sayin'.

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