Western Digital to Acquire Virident Systems (WDC)

On Monday, storage solution company Western Digital Corp (WDC) announced that it has agreed to acquire Virident Systems, Inc. for $685 million.

The flash storage solutions company will be purchased by HGST, which is a subsidiary of WDC, for a total of $685 million in cash. This amount represents approximately $645 million in enterprise value.

This deal will allow WDC to expand its presence in the solid state drives market. This market is expected to grow from $2.5 billion in revenue in 2012 to $7 billion in revenue by 2017.

Mike Cordano, president of Western Digital unit HGST commented: “Virident’s server-side flash storage helps datacenter customers solve their most significant data infrastructure challenges, including application performance across diverse workloads, power efficiency, and total cost of ownership.”

Western Digital shares were up 37 cents, or 0.57%, during pre-market trading Monday. The stock is up 53% YTD.

Top China Companies To Watch For 2014

The following video is from Thursday's Investor Beat,� in which host Rex Moore, and analysts Jason Moser and Matt Koppenheffer dissect the hardest-hitting investing stories of the day.

Bad news for Ebix (NASDAQ: EBIX  ) shareholders today, as the stock drops 44% on a criminal investigation. Two 3-D players print up a merger.�Kroger (NYSE: KR  ) reported earnings that were up about 10%, and raised guidance for the year. And Kinross Gold Corporation (NYSE: KGC  ) was down 8% today. In this installment of Investor Beat, Motley Fool analysts Jason Moser and Matt Koppenheffer discuss four stocks making big moves.

The Economist compares this disruptive invention to the steam engine and the printing press. Business Insider says it's "the next trillion dollar industry." And everyone from BMW, to Nike, to the U.S. Air Force is already using it every day. Watch The Motley Fool's shocking video presentation today to discover the garage gadget that's putting an end to the Made In China era ... and learn the investing strategy we've used to double our money on these three stocks. Click here to watch now!

Top China Companies To Watch For 2014: Qihoo 360 Technology Co. Ltd.(QIHU)

Qihoo 360 Technology Co. Ltd. provides Internet and mobile security products in the People's Republic of China. Its principal products include 360 Safe Guard, an Internet security product for Internet security and system optimization; 360 Anti-Virus, an anti-virus application to protect users? computers against trojan horses, viruses, worms, adware, and other forms of malware; and 360 Mobile Safe, a security program for the Google Android, Apple iOS, and Nokia Symbian smartphone operating systems. The company?s platform products comprise 360 Safe Browser, a Web browser; 360 Personal Start-up Page, a default homepage of 360 Safe Browser and a key access point to popular and preferred information and applications; 360 Application Store, a key access point to securely obtain and manage software and applications; and 360 Safebox, a solution that protects users against thefts of personal account information. It also provides online advertising services, including online marketi ng services and search referral services; and Internet value-added services comprising the operation of Web games developed by third-parties, remote technical support, and cloud-based services. The company was formerly known as Qihoo Technology Company Limited and changed its name to Qihoo 360 Technology Co. Ltd. in December 2010. Qihoo 360 Technology Co. was founded in 2005 and is based in Beijing, the People?s Republic of China.

Advisors' Opinion:

• [By Belinda Cao]

  Oberweis China Opportunities Fund (OBCHX), the best-performing U.S.-based fund investing in Chinese stocks, said Internet companies from NQ Mobile Inc. (NQ) to Qihoo 360 Technology Co. (QIHU) will extend a rally after jumping more than three-fold this year.

• [By Paul Ausick]

  Notable earnings reports currently on tap for next week: Qihu 360 Technology Co. Ltd. (NASDAQ: QIHU), Avago Technologies Ltd. (NASDAQ: AVGO), LDK Solar Co. Ltd. (NYSE: LDK), Tiffany & Co. (NYSE: TIF), Joy Global Inc. (NYSE: JOY), Campbell Soup Co. (NYSE: CPB), JA Solar Holdings Co. Ltd. (NASDAQ: JASO), Krispy Kreme Doughnuts Inc. (NYSE: KKD), and ReneSola Ltd. (NYSE: SOL).

• [By Jon C. Ogg]

  Qihoo 360 Technology Co. (NYSE: QIHU) was raised to Buy from Hold at Jefferies.

  Safe Bulkers Inc. (NYSE: SB) was raised to Buy all the way up from Underperform for a two-notch upgrade, and the price target was raised to $8 from $6, at BofA/Merrill Lynch.

Top China Companies To Watch For 2014: ChinaCast Education Corporation(CAST)

ChinaCast Education Corporation, together with its subsidiaries, provides post-secondary education and e-learning services in China. The company operates in two segments, E-learning and Training Service Group and Traditional University Group. The E-learning and Training Service Group provides post secondary education distance learning services that enable universities and other higher learning institutions to provide nationwide real-time distance learning services. It also provides K-12 educational services, such as broadcast multimedia educational content services to primary, middle, and high schools; and vocational/career training services. The Traditional University Group segment operates private residential universities that offer four-year bachelor?s degree and three-year diploma programs in finance, economics, trade, tourism, advertising, IT, music, foreign languages, tourism, hospitality, computer engineering, law, and art. The company also provides logistic service s. ChinaCast Education Corporation was founded in 1999 and is headquartered in Central, Hong Kong.

Hot Penny Stocks To Watch For 2014: New Oriental Education & Technology Group Inc.(EDU)

New Oriental Education & Technology Group Inc. provides private educational services primarily in the People?s Republic of China. It offers a range of educational programs, services, and products consisting primarily of English and other foreign language training; test preparation courses for admissions and assessment tests; primary and secondary school education; development and distribution of educational content; software and other technology; and online education. The company?s language training courses primarily consist of various types of English language training courses, and other foreign languages, including German, Japanese, French, Korean, and Spanish. It offers test preparation courses for language and entrance exams used by educational institutions in the United States, the People?s Republic of China, and commonwealth countries. The company also operates primary and secondary schools in Yangzhou. In addition, New Oriental Education & Technology Group Inc. deve lops and edits content for educational materials for language training and test preparation, such as books, software, CD-ROMs, magazines, and other periodicals. It distributes these materials through various distribution channels consisting of own classrooms and bookstores, as well as third-party distributors. Further, the company offers various online education programs on its Web site, koolearn.com. Additionally, it provides consulting services to help students through the application and admission process for overseas educational institutions, as well as post-secondary educational programs to help students seek career opportunities; and operates two pre-schools. The company offers educational services under the ?New Oriental? brand name. As of May 31, 2010, it offered education programs, services, and products through a network of 48 schools, 319 learning centers, and 25 bookstores. The company was founded in 1993 and is headquartered in Beijing, the People?s Republic of China.

Top China Companies To Watch For 2014: Home Inns & Hotels Management Inc.(HMIN)

Home Inns & Hotels Management Inc. develops, leases, operates, franchises, and manages a chain of economy hotels in the People?s Republic of China. The company operates its hotels under the Home Inn brand name. As of April 28, 2011, it had approximately 800 Home Inns in operation and 1,000 Home Inns sealed in franchise agreements. The company was incorporated in 2001 and is headquartered in Shanghai, the People?s Republic of China.

Top China Companies To Watch For 2014: ChinaEdu Corporation(CEDU)

ChinaEdu Corporation, together with its subsidiaries, provides educational services to the online degree programs of universities in the People?s Republic of China. It also offers online tutoring services to primary and secondary school students; operates primary and secondary schools; and markets international English language curriculum programs to established learning institutions, as well as international polytechnic programs to vocational schools in China. The company?s online degree programs offer associate and bachelor?s degree programs, including accounting, marketing, finance, business administration, international business, law, civil engineering, education, computer science, literature, project management, marketing, and administrative management. These online degree programs primarily target working adults. Its services also include academic program development, technology services, enrollment marketing, recruiting, student support services, and finance operati ons. The company provides technical, recruiting, and other services for the online degree programs of 27 universities; and technology support services to 7 additional universities that are awaiting regulatory approval to launch their online degree programs. As of December 31, 2010, it served approximately 311,000 online degree programs students, as well as approximately 51,450 students in other businesses. ChinaEdu Corporation was founded in 1999 and is based in Beijing, the People?s Republic of China.

Top China Companies To Watch For 2014: iSoftStone Holdings Limited(ISS)

iSoftStone Holdings Limited provides various information technology (IT) services and solutions in the Greater China and internationally. It offers an integrated suite of IT services and solutions, including consulting and solution services, IT services, and business process outsourcing (BPO) services. The company provides a range of consulting services for an overall engagement or discrete consulting services in conjunction with other services. It also develops industry-specific solutions, including treasury management, cash management, property and casualty insurance core, financial holding company business analysis, trust company core, and banking risk management solutions for banking, financial services, and insurance industries; supply chain management, enterprise information portals, business intelligence, business process integration, and management and e-commerce solutions for energy, transportation, and public sectors; mobile and embedded technology, next generati on platforms, business intelligence functionality, and network security products for the communications industry. In addition, the company offers various IT services consisting of application development and maintenance, research and development, and infrastructure and software services. Further, it provides a range of BPO services, such as securities trade processing services for the investment banking industry; digitization and archiving of policyholder information, as well as account processing and customer service for insurance industry; and cross-industry BPO services comprising finance and accounting, customer care, and human resources. The company was founded in 2001 and is headquartered in Beijing, the People?s Republic of China.

Top China Companies To Watch For 2014: Vanceinfo Technologies Inc(VIT)

VanceInfo Technologies Inc., together with its subsidiaries, engages in the provision of information technology (IT) services. The company offers research and development services in various phases of development, including requirements analysis, concept generation, product realization, quality assurance and testing, and technology and information transfer; and develops software products, such as middlewares, Internet protocols, and other software. It provides enterprise solutions for packaged evaluation and selection, packaged implementation, customization, regional rollout, version upgrades, and business intelligence/data warehouse, as well as enhancement, maintenance, and product support; and designs, develops, and implements software solutions to meet various client requirements, and provides maintenance services for software systems. VanceInfo also offers customized and automated testing practices, which include functional testing, globalization and localization testi ng, automation testing, performance testing, remote testing, and test process consulting; and globalization and localization services that comprise software and content localization, localization engineering, localization testing, internationalization engineering, and internationalization testing. The company serves technology, telecommunications, financial services, manufacturing, and retail and distribution industries primarily in China, the United States, Europe, and Japan. VanceInfo Technologies Inc. was founded in 1995 and is headquartered in Beijing, the People?s Republic of China.

Top China Companies To Watch For 2014: Spreadtrum Communications Inc.(SPRD)

Spreadtrum Communications, Inc., through its subsidiaries, operates as a fabless semiconductor company that designs, develops, and markets baseband processor and RF transceiver solutions for wireless communications and mobile television markets. It offers a portfolio of integrated baseband processor solutions that support a range of wireless communications standards, including global system for mobile communication (GSM), general packet radio service (GPRS), enhanced data rates for GSM evolution (EDGE), time division synchronous code division multiple access (TD-SCDMA), and high speed packet access (HSPA), as well as offer an array of multimedia capabilities, such as MP3 digital audio playback, touch screen, JAVA acceleration, digital camera support, motion JPEG, MPEG4, AVS and H.264 digital video playback, and 64-channel polyphonic ringtone playback. The company also provides single-chip CMOS multi-mode RF transceivers that perform across various standards covering GSM/GP RS, EDGE, wideband code division multiple access, TD-SCDMA, and high speed uplink/downlink packet access. In addition, it designs, develops, and markets a CMMB-based channel demodulator and audio/video decoder processor solution for the mobile television market. The company sells its products directly, as well as through distributors to brand manufacturers, independent design houses, and original design manufacturers primarily in China, Hong Kong, and Macau. Spreadtrum Communications, Inc. was founded in 2001 and is headquartered in Shanghai, the People?s Republic of China.

How To Read The Michigan Consumer Sentiment Index

Top Dividend Stocks To Watch For 2014

Several major economic indices and indicators can help investors and economists predict where the economy is headed. The Consumer Price Index (CPI), the Producer Price Index (PPI) and Gross Domestic Product (GDP) all forecast the future health of the U.S. economy. The Michigan Consumer Sentiment Index is another key indicator designed to illustrate the average U.S. consumer's confidence level. This indicator is important to retailers, economists and investors, and its rise and fall has historically helped predict economic expansions and contractions.

History, Nature and Purpose

The Michigan Consumer Sentiment Index was created in the 1940s by professor George Katona at the University of Michigan's Institute for Social Research. His efforts ultimately led to a national telephone survey conducted and published monthly by the university. The survey is now conducted by the Survey Research Center and consists of at least 500 telephone interviews posed to a different cross-section of consumers in the continental U.S. each month. The survey questions consumers on their views of their own personal finances, as well as the short-term and long-term state of the U.S. economy. Each survey contains approximately 50 core questions, and each respondent is contacted again for another survey six months after completing the first one. The answers to these questions form the basis of the index.

About 60% of each monthly survey consists of new responses, and the remaining 40% is drawn from repeat surveys. The repeat surveys help reveal the changes in consumer sentiment over time and provide a more accurate measure of consumer confidence. The survey also attempts to accurately incorporate consumer expectations into behavioral spending and saving models in an empirical fashion.

How the Index is Calculated

The CSI is basically calculated by subtracting the perc! entage of unfavorable consumer replies from the percentage of favorable ones. The CSI website provides a breakdown of how the index is calculated based on the answers to the following five core survey questions:

x1) "We are interested in how people are getting along financially these days. Would you say that you (and your family living there) are better off or worse off financially than you were a year ago?"

x2) "Now looking ahead - do you think that a year from now you (and your family living there) will be better off financially, or worse off, or just about the same as now?"

x3) "Now turning to business conditions in the country as a whole - do you think that during the next 12 months we'll have good times financially, or bad times, or what?"

x4) "Looking ahead, which would you say is more likely - that in the country as a whole we'll have continuous good times during the next five years or so, or that we will have periods of widespread unemployment or depression, or what?"

x5) "About the big things people buy for their homes - such as furniture, a refrigerator, stove, television and things like that. Generally speaking, do you think now is a good or bad time for people to buy major household items?"

To calculate the CSI, first compute the relative scores (the percent giving favorable replies minus the percent giving unfavorable replies, plus 100) for each of the five index questions. Round each relative score to the nearest whole number. Using the formula shown below, add the five relative scores, divide by the 1966 base period total of 6.7558, and add 2.0 (a constant to correct for sample design changes from the 1950s).

The actual equation that this data is plugged into is:

CSI = x1 + x2 + x3 + x4 + x5 / 6.7558 + 2.0

The CSI's Impact

The Michigan CSI has grown from its inception to be regarded as one of the leading indicators of consumer sentiment in the United States. History shows that consumer confidence has been at its lowest point just prior to and in the midst of recessionary periods. The index rises when consumers regain confidence in the economy, which portends increased consumer spending and thus economic growth. This growth, in turn, leads to greater interest from foreign investors, which results in the increased value of the dollar against other foreign currencies. Historically speaking, the value of the dollar has usually risen whenever the Michigan CSI has come in at a higher level than was anticipated and fallen when the index came in lower.

The Index of Consumer Expectations (ICE) was created as a subsidiary of the CSI. It has come to be included in the larger index of Leading Composite Indicators published by the Bureau of Economic Analysis through the Department of Commerce.

How Investors Can Use the CSI

When consumer confidence increases, certain sectors tend to benefit sooner than others. Companies that provide consumer goods often reap the initial fruits of improved consumer sentiment. Consumers who feel more confident about the economy generally also feel better about their employment prospects and are therefore more willing to buy houses, cars, appliances and other items. Investors should look at the stocks of car manufacturers,! home builders and other retailers that typically see sales rise when the economy begins an expansion period.

As mentioned previously, the dollar's value also tends to fluctuate in accordance with the rise and fall of the CSI, so traders and speculators can take positions to profit from sudden moves that may occur when the index is posted. (It is no longer possible to purchase a subscription that will get you that information five minutes before its public dissemination, as the University of Michigan canceled its agreement with Thomson Reuters to do this after the chairman of the Securities and Exchange Commission stated that it may have been an unfair practice.)

The Bottom Line

The Michigan Consumer Sentiment Index has provided a relatively accurate forecast of future consumer confidence and spending for the past several decades. For more information about the Michigan CSI and its impact on economic analysis, consult your investment advisor or log on to the Surveys of Consumers: Thomson Reuters/University of Michigan website at http://www.sca.isr.umich.edu/.

LPL to offer advice to 401(k) participants

Retirement plan participants served by Ascensus Inc. and The Vanguard Group Inc. — with more than $2 billion in assets combined — are set to begin receiving personalized financial advice, courtesy of LPL Financial Retirement Partners.

LPL Financial LLC yesterday announced the partnership with the two massive retirement plan service providers at its focus13 conference in San Diego.

Bill Chetney, executive vice president at LPL Financial Retirement Partners, said LPL is in talks with New York Life Insurance Co. to provide advice to participants in plans serviced by the insurer.

Under the deal, LPL Financial Retirement Partners will reach out to participants in plans serviced by Ascensus and Vanguard through LPL's Worksite Financial Solutions program. About 1,000 plans, representing more than $2 billion in assets, will comprise the initial group of 401(k) plans that will be able to use the service. LPL expects to expand the service to other record keepers, Mr. Chetney said.

LPL’s Worksite Financial Solutions will only be available to LPL plans and participants on the Ascensus record keeping platform. As for Vanguard, only LPL plans that use the Retirement Plan Access 401(k) service for small to mid-sized plans and their participants will be able to use Worksite Financial Solutions.

Since March, Worksite Financial Solutions and LPL's research department have been developing investment models and providing advice to participants in partnership with Morningstar Inc. Participants have been able to interact with LPL advisers, either in person, via the web or over the telephone.

In addition to access to these services, under the new partnership, participants also will have access to educational programs on financial wellness.

The cost for the service includes a base platform fee plus compensation to the adviser that's charged on an asset level and depends on the workload the adviser takes on. Those expenses are charged on an institutional basis, so the more participants in the plan, the lower the cost.

Mr. Chetney noted that the greatest failing of the 401(k) industry is the do-it-yourself nature of structuring investments within retirement plans.

“We simply provide participants with a fund menu of 25, 50, 100 funds, and after an education meeting, we tell them to pick out their own investment mix,” he said. “You can't imagine that someone would sit down with a customer and tell them good luck picking their investments.”

In addition, Mr. Chetney contends that it's unthinkable that someone would invest their entire net worth based on a ! single data point — their age.

“It's almost shocking that the industry touts this target date solution when it's something so deficient,” he said.

Naturally, one of the biggest deterrents to providing advice to 401(k) plan participants as a whole is the fact that the account balances tend to be small, so the profits aren't massive. Mr. Chetney noted that the volume of the accounts is what makes this endeavor profitable for LPL.

“You're dealing with volumes of $50,000 accounts,” he said. “The economics are attractive, and you're able to deliver that advice at institutional pricing.”

A Non-Hodgkin's Lymphoma Cinderella Play (CELG, GILD, INFI)

When investors think of non-Hodgkin's lymphoma stocks, big names like Gilead Sciences, Inc. (NASDAQ:GILD) and Celgene Corporation (NASDAQ:CELG) come to mind. Both GILD and CELG are making prolific progress in the war on NHL, and both are fine, well-positioned companies. It's little Infinity Pharmaceuticals Inc. (NASDAQ:INFI) that may end up making the proverbial quantum leap in the non-Hodgkin's lymphoma stocks arena, however, and better still, it's INFI shares that may well end up doling out a much bigger reward than Gilead or Celgene could to newcomers.

The non-Hodgkin's lymphoma is worth about $6 billion per year now, and is projected to be worth more than $8 billion by 2019. That's why so many companies are working on treatments. Not all of them are making rapid or effective progress though. In fact, Celgene Corporation announced a couple of days ago that its Revlimid trial (as a treatment for B-cell lymphomatic leukemia) was being discontinued due it ineffectiveness. The drug and the company are still a player in the NHL world, but the drug's failure is an example of how blood-related cancers are not easy diseases to target.

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Gilead Sciences currently has Idelalisib in Phase 2 trials as a therapy for non-Hodgkin's lymphoma, and though it looks a little more encouraging than most other in-development NHL drugs at this point, the end of Phase 3 trials is a long way away, and much could disrupt that journey.

To be fair, it's not as if INFI is a significantly better bet. On a relative basis though, while the market is pricing shares of GILD and CELG as of they're sure things, and giving their stocks' prices a little extra bump for being an established and diversified biotech name. Infinity, on the other hand, is getting little love. That, however, is where the opportunity lies... nobody sees this little company coming.

With a market cap of only $870 million, it's not like Infinity Pharmaceuticals turns a lot of heads within the investment community. The pipeline of only four drugs (treating five different indications) isn't terribly deep either. None of these trials is past Phase 2 testing. Yet, there's just something compelling about INFI - and its NHL drug IPI-145 - that says this stock could be a real Cinderella story.

As interesting (though admittedly incomplete) as the efficacy data is so far, it's the chart of Infinity Pharmaceuticals Inc. After a great 2012 and early-2013 that carried the stock from around $10.00 to as high as $50.00, the tide turned against the stock and pulled it all the way back to $15.00 just a few weeks ago. But, we've seen a low, arc-shaped recovery effort since then... the kind of reversal that lasts because it starts slow and then builds steam [as opposed to V-shaped reversals, which start with a bang but leave no gas in the tank]. The fact that INFI is so severely oversold only makes for more upside potential.

Bottom line? Infinity is unknown and unloved, yet has a great story that the market can easily fall in love with (again). Don't overthink it. The stock's starting to rise again as that love rebuilds. Time to take a swing.

Infinity Pharmaceuticals Inc. is a SmallCap Network Featured Stock. If you'd like to get more updates and information (and opinion) on the company and the stock's trend - like when to take some profits - be sure to sign up for the free SCN daily e-newsletter.

Market Wrap For Tuesday, September 24: Markets Go Parabolic

Equity markets spiked lower Tuesday morning, catching up with futures lows. However, a sharp recovery left markets flat on a day of heavy economic data.

Major Indexes

The Dow Jones Industrial Average dropped 66.79 points, or 0.43 percent, to 15,334.59.

The S&P 500 fell 4.42 points, or 0.26 percent, to 1,697.42.

The Nasdaq lost gained 2.96 points on the day, or 0.08 percent, to finish at 3,768.25.

The Russell 3000 gave up 1.61 points points, or 0.16 percent to finish at 1,018.99

Home Price Index

The month over month home price index was up one percent while analysts were expecting a 0.9 percent increase. Year over year, the reading is up 8.8 percent. Measuring the price of single family homes, the home price index is used to estimate changes in mortgage defaults and housing affordability.

Consumer Confidence

The Conference Board consumer confidence reading for September came in as expected, but is still a four month low at 79.70. The previous month's reading was 81.5.

Stock Movers

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Greenway Medical Technologies (NYSE: GWAY) rose 19.09 percent to $20.40 after the company agreed to be acquired by Vista Equity Partners for $20.35 per share.

Applied Materials (NASDAQ: AMAT) rose 9.06 percent to $17.44 after the company announced its plans to acquire Tokyo Electron in an all-share deal.

Facebook (NASDAQ: FB) grew 2.69 percent to $48.46 after Citigroup upgraded the stock from Neutral to Buy.

Cypress Semiconductor (NASDAQ: CY) traded down 14.87 percent to $9.65 after the company lowered its Q3 forecast.

Red Hat (NYSE: RHT) shares tumbled 11.71 percent to $46.73 after the company reported Q2 results. Piper Jaffray downgraded the stock from Overweight to Neutral.

Carnival (NYSE: CCL) moved down 7.65 percent to $34.54 on disappointing Q3 results.

Commodities

Crude oil was mixed Tuesday. Late in the day, WTI futures were down 0.16 percent to $103.42 while Brent was up 0.6 percent 108.81. NYMEX natural gas futures were down 2.72 percent to $3.50.

Precious metals prices were also mixed on the day. Late in the day COMEX gold futures were down 0.22 percent to $1,324.10 while spot was up 0.11 percent to $1,324.12. Silver futures were down 0.42 percent to $21.77.

Volume and Volatility

The VIX fell 1.89 percent to 14.03 despite big market moves. Overall volatility remains relatively low.

As expected with several flip flops, volume was low on the day. Heading into the close, just 84 million shares of the SPDR S&P 500 index (NYSE: SPY) traded hands, compared to the 127 million three month average.

Currencies

The greenback was generally higher on the day, with the PowerShares DB US Dollar Bullish ETF (NYSE: UUP) trading up 0.18 percent to 21.74.

The widely traded EUR/USD pair was down 0.15 percent to $1.3473. Other key movers on the day include the AUD/USD, which fell 0.43 percent, and the GDP/USD which dropped 0.24 percent.

Global Markets

Asian markets moved down overnight. The Shanghai index fell 0.61 percent with Hong Kong's Hang Seng down 0.82 percent. Japan's Nikkei dropped just 0.07 percent.

European markets recorded gains for the day. The Euro Stoxx index, which tracks 50 euro zone blue chips was up 0.57 percent. London's FTSE added 0.21 percent, and France's CAC gained 0.56 percent.

It Cannot Get Any Worse at Sears — Except at J.C. Penney

For those who had hoped that Sears Holdings Corp. (NASDAQ: SHLD) would break out of its multiyear revenue and earnings funk, think again. After too many management changes to count, and fits and starts of redesigning its K-Mart and Sears stores, majority holder and CEO Eddie Lampert botched it again.

There is no reason to go beyond the retail holding company’s press release:

Second Quarter Revenues and Comparable Store Sales Revenues decreased $596 million to $8.9 billion for the quarter ended August 3, 2013, as compared to revenues of $9.5 billion for the quarter ended July 28, 2012.

And:

For the quarter, domestic comparable store sales declined 1.5%, comprised of decreases of 2.1% at Kmart and 0.8% at Sears Domestic. The decline at Kmart reflects decreases in our transactional categories, such as grocery & household, pharmacy and drugstore. It also includes declines in consumer electronics and toys. These decreases were partially offset by increases in the footwear and lawn & garden categories.

Of course, Sears Holdings lost money. Last year the net loss was $133 million. This year that improved to a loss of $127 million.

Lampert was crazy enough to paint the picture as OK:

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“We made meaningful progress this quarter in our transformation to a member-centric company. Shop Your Way members represented over 65% of our sales and they redeemed rewards points at a significantly higher rate than last year. While the increase in Shop Your Way promotional activity and member redemptions resulted in a meaningful increase in our costs, it demonstrates that our members are deepening their engagement with our program which will allow us to further accelerate our transformation,” commented Eddie Lampert, Sears Holdings’ Chairman and Chief Executive Officer. “At the same time, we recognize how important it is to improve the profitability of our company and I am disappointed that we did not deliver a better result.”

So, stronger engagement, but weaker sales.

Update: Prosensa Sinks On Drug Disappointment, Sarepta Gains

Sarepta Therapeutics (SRPT) and Prosensa Holding NV (RNA) were both big movers today, although in very different directions.

At recent check, Prosensa was down 69%. Earlier today the company, partnered with GlaxoSmithKline (GSK), announced that the primary endpoint in its Phase 3 study of its Duchenne muscular dystrophy treatment Drisapersen was not met.

In a randomized double-blind study of 186 boys over 48 weeks, the drug did not show statistically significant improvement in the 6 Minute Walking Distance (6MWD) test compared to a placebo.

On a conference call, management said that it could take weeks, if not months to analyze the data, and thus could not offer guidance in regard to its next step would be.

By contrast Sarepta was jumping 22% on the news, as it is developing the drug Eteplirsen as a rival treatment. Barron's Andrew Bary correctly predicted last month that Prosensa's loss would be Sarepta's gain. Nonetheless, there was some chatter about potentially increased difficulty for Eteplirsen's approval in the wake of the Drisapersen disappointment.

Still, both Needham’s Chad Messer and Robert W. Baird’s Brian Skorney view the news as a bullish event.

Messer writes “Although we concede some people, potentially including the FDA, may now be more skeptical of exon-skipping technology in general, we are confident in Etelpirsen’s efficacy based on the long-term consistency of the Phase IIb data.” He also believes that with Drisapersen’s removal, there is less risk to Etelpirsen’s market share position. He has a $57 price target on the stock.

Skorney also notes that the news may not be all positive, given the possibility of caution from regulators, but writes “we believe the elimination of Prosensa as a potential competitor more than offsets any increase in risk to the fundamental thesis.” He has a $63 price target on the stock.

5 Best Cars for Short Drivers

BOSTON (TheStreet) -- Short drivers can sometimes feel like they're in an episode of Little People, Big World when out car shopping, so here are five great models for those of us who look more like Danny DeVito than LeBron James.

"Short drivers obviously have different needs than taller ones," says Warren Clarke of Edmunds, which recently named the Best Cars for Short Drivers for 2013. "The main thing they need is visibility. If you're short and you buy the wrong vehicle, you can end up looking at the car's door instead of out the window."

Clarke says the best models for smaller drivers have low "beltlines" -- the border between a car's metal body and its windows -- and big "greenhouses," the glass area above the frame and below the roof.

He says short drivers should also look for cars with narrower seat cushions, as wide upholstery makes it harder for smaller people to reach a vehicle's pedals comfortably. "People tend to assume that smaller cars are the best choices for smaller drivers, but that's not always true," Clarke says. "Visibility and seat comfort have to do with how a vehicle's cabin has been designed, not necessarily with the car's size." Unfortunately, wider seat cushions often make cars more comfortable for bigger drivers, while higher beltlines and smaller greenhouses tend to look cool -- so more and more automakers seem to favor all three. "There are still models that offer lower beltlines and bigger greenhouses, but you have to specifically look for them," Clarke says. Click below to check out the five lowest-priced such models that Edmunds recommends for shorter drivers (or here for cars the site suggests tall drivers consider). All vehicles listed below appear in order of their manufacturer's suggested retail price for 2013 base models.

Kia Soul

Base price: $14,400

If those cartoon hamsters in Kia's TV commercials for the Soul like this small wagon, shorter human drivers should enjoy it, too.

"It's immediately obvious when you look at that Soul that it's got fairly big greenhouse, with a tall windshield and tall, upright side windows," Clarke says. "Visibility is excellent, and it should be very easy for shorter drivers to see out of the Soul's cabin." Also see: XXXX>> Clarke says the Soul also offers both short and taller drivers a roomy cabin, a modest price and "very good, distinctive styling. It's got that boxy shape that you don't see very often." Under the hood, the 2013 Soul comes standard with a 138-horsepower four-cylinder engine and manual transmission -- a combination that delivers an estimated 25 miles per gallon in the city and 30 mpg on the highway. Another bonus: Kia's industry-leading 10-year/100,000-mile powertrain warranty. You should also look for a completely redesigned 2014 Soul to begin hitting dealer showrooms this fall, starting at $14,700.

Mazda Mazda3

Base price: $16,945

The Mazda3 offers shorter drivers not just great visibility, but great affordability as well.

"This is a really good car to buy if you're on a tight budget, because it's affordable but has great handling," Clarke says. "It's the kind of car that you typically have to pay a lot more money for." And while Edmunds editors like the 2013 Mazda3, a redesigned 2014 version already in Mazda showrooms features a slightly larger and even fancier interior despite an unchanged base price. The 2014 edition also comes standard with a 155-horsepower four-cylinder engine and a manual transmission that team up to produce an impressive 29 mpg/city and 40 mph/highway. Or you can add a six-speed automatic transmission and boost city mileage to 30 mpg.

Volkswagen Passat

Base price: $20,845

This family sedan from Volkswagen features an upscale interior that Clarke says is roomy, but not too big for shorter drivers to safely and comfortably use.

"One of the things I like about the Passat is it has lots and lots of legroom," he says. "It also really feels like you're in a European sedan -- you get a high level of refinement at a really affordable price." Volkswagen is also phasing an improved turbocharged engine into the line, boosting fuel efficiency to 24/mpg city and 35 mpg/highway with a manual transmission. (Automatics get 1 mpg lower highway mileage.) Also see: XXXX>> If that's not "green" enough for you, there's a $26,295 diesel Passat that gets 31 mpg/city and 43 mpg/highway with a manual transmission or 30 mpg/city and 40 mpg/highway with an automatic (technically an "automated manual transmission").

Subaru Forester

Base price: $21,995

"You can just tell by looking at a Forester that its visibility will be excellent for shorter drivers because its greenhouse is huge," Clarke says. "It's got big windows all around."

The Forester also comes standard with all-wheel drive and 8.7-inch ground clearance -- both great for driving either off-road or in bad weather. A redesigned 2014 model already in dealer showrooms also boasts a larger cabin, higher-quality finishes and better transmissions than the 2013 offers despite the same starting price. The changes have added a few miles per gallon to the crossover SUV's fuel efficiency, with a base 2014 Forester now rated at 22 mpg/city and 29 mpg/highway with manual transmission. (The model gets 24 mpg/city and 32 mpg/highway as an automatic.)

Honda Accord

Base price: $21,995

The Accord might not offer the auto industry's most exciting look, but Clarke says the model's big windows make the Honda (HMC) a great choice for shorter drivers.

"The whole greenhouse thing doesn't necessarily lend itself to a sexy-looking car, but it does create a highly functional one because you can see clearly out the windows," he says. "That's certainly true with the Accord." The expert adds that the Accord also boasts a "super-roomy" cabin, good-quality finishes, quick acceleration and sharp handling. The base Accord comes standard with a 185-horsepower four-cylinder engine and a manual transmission that produce a good 24 mpg/city and 34 mpg/highway or 27 mpg/city. (Automatics get 27 mpg/city and 36 mpg/highway.) Environmentalists should also check out the plug-in hybrid Accord that Honda has already rolled out for 2014, or a traditional hybrid that's expected to reach showrooms shortly.

Five Stocks Trading Below Cash That Hedge Funds Love

At BillionairesPortfolio.com, I am always looking for deep value stocks that are owned by some of the world's top hedge funds and billionaire investors.

Nothing represents a great value play more than a stock that is trading below the cash it holds on its books.

A stock that is trading "below cash" means the company has more cash on its balance sheet than its entire market capitalization. As billionaire hedge fund David Tepper put it "buying cash for less than cash" is one of the easiest ways to make money in the stock market.

Here are five stocks that top hedge funds own that are also trading below cash:

1)      STR Holdings, Inc. has $1.74 per share in cash and has zero debt.  The stocks sells for only $1.72.  Top hedge fund Red Mountain Capital Partners owns nearly 15% of this stock.

2)      Career Education Corporation has $3.44 in cash per share and zero debt.  The stocks sells for $2.66.  Blum Capital Partners, a top hedge fund/private equity firm, owns almost 14% of this stock.

3)      AVEO Pharmaceuticals AVEO Pharmaceuticals, Inc. has $3.04 per share in cash and has zero debt.  The stock sells for only $2.09.  Billionaire and legendary hedge fund manager, Seth Klarman of the Baupost Group owns more than 7% of this stock.

4)      The First Marblehead First Marblehead Corporation has $1.23 per share in cash and has zero debt.  The stock sells for just $0.85. Value-based hedge fund Mangrove Partners owns almost of 10% of this stock.

5)      Savient Pharmaceuticals, Inc. has $0.71 per share in cash and has zero debt.  The stock sells for only $0.62 cents. Top biotech hedge fund Palo Alto Investors owns more than 13% of this stock.

Disclosure:  Clients of Billionaire's Portfolio, own shares of STR Holdings.  Bryan Rich is co-founder of BillionairesPortfolio.com and CEO of Logic Fund Management, Inc.

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Oracle: Genghis Khan Invades The Cloud

"It is not sufficient that I succeed - all others must fail."

Genghis Khan

Investment gurus are buying Oracle (ORCL) while insiders sell. If the team may no longer trusts the boss, a recent deal with salesforce.com (CRM) might have convinced big investors that Larry Ellison has finally made his big cloud move. That means everybody else goes down.

"False cloud" no more

Salesforce chief Marc Benioff once said Oracle was selling customers a "false cloud," but he can't say that any longer: his company announced in June it will "standardize" on some Oracle products, even hardware. Oracle CEO Larry Ellison, known for downplaying the importance of the cloud, may now be invading like his hero Genghis Khan.

He already owns a good chunk of NetSuite (N), whose revenue grew 35% last quarter, beating earnings estimates by $0.03 a share. Ellison's been profiting from the cloud while dismissing its significance. With the Salesforce agreement his company is, too. (Fool)

Here comes Genghis Kahn

Fiercely competitive Oracle CEO and co-founder Larry Ellison remains a legend in the software business. He worships Genghis Kahn, founder and emperor of the Mongol Empire all those years ago. Living by his famous quote (see above) has allowed Oracle to thrive through all manner of disruptive changes in technology. It now boasts 390,000 customers - including every Fortune 100 firm.

Even disappointing Wall Street the past two quarters, the stock falling 10% - blaming the global economy and sales force - Oracle remains a cash-flow machine:

*Last year they generated $14.2 billion in operating cash flows.

*They've grown an average of 19% per year over eight years.

*They have $32.2 billion on-hand.

The company returned almost 90% of its $14 billion in operating cash flow to shareholders in the form of dividends and share repurchases this year.

Oracle takes cloud seriously

A variety of acquisitions ramps up Oracl! e's presence in cloud computing, like deals with RightNow, Taleo, and Eloqua. The annual run-rate of their cloud business is already over $1 billion, larger than Workday (WDAY) and SAP (SAP) combined. New customers include British Telecom (BT), BMC Software (BMC), Siemens (SI), Yahoo (YHOO), and Intuit (INTU).

Beyond the heightened M&A activity, Oracle has the benefit of its massive infrastructure. Their cloud system processes a billion transactions per day with:

*13,000 virtual machines

*70 petabytes of storage

*Across seven countries

In addition to its partnership with Salesforce.com, Oracle announced a deal with its old nemesis Microsoft (MSFT).

Investment gurus are buying Oracle

Oracle was the most-purchased stock of gurus in the second quarter with 20 net buys (30 bought while 10 sold). With the fall-off in the stock, the valuation of Oracle's shares is certainly attractive. The forward price-to-earnings ratio is only 9. (InvestorPlace)

On the Peter Lynch chart it appears undervalued. After a sharp drop in the first quarter and another in the second, Oracle's stock is down 1.59% year to date. For its fiscal 2013 fourth quarter, the company reported flat year-over-year revenues at $10.9 billion, and 10.9% higher GAAP earnings of $3.8 billion.

A market cap of $151.98 billion and shares trading around $32.82 yields a:

*P/E ratio of 14.40

*P/S ratio of 4.20

*Dividend yield of 0.60%.

With an annual average earnings growth of 20% over the past 10 years, GuruFocus rated Oracle Corporation the business predictability rank of 5-star. (Forbes)

Insiders are selling Oracle

There have been 4,144,577 shares sold by insiders with zero shares purchased this year. Sales appear to be accelerating:

Top Small Cap Companies For 2014

Insider Shares Sold (2013)

May	2,909
June	552,500
July	2,962,500

DISCLOSURE: Safra Catz sold 2,960,000 shares on July 15-17. She's been President of Oracle Corporation since January 2004, a member of the Board of Directors since October 2001, and Chief Financial Officer as of April 2011.

Listen to investment gurus or Safra?

Insiders sell stock for all manner of reasons, but investment gurus only get in for one: because they want to make money. Sure, there have been no insiders buying Oracle shares the past month or so. With a forward P/E ratio of 10.31, a book value of $9.54 per share, and a dividend yield of 1.48% - and all those gurus wanting in - the answer seems clear enough.

Bet against the insiders.

Source: Oracle: Genghis Khan Invades The Cloud

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. (More...)

Do Gamers Like Starcraft II: Heart of the Swarm?

With shares of Activision Blizzard (NASDAQ:ATVI) trading at around $15.57, is ATVI an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock's Movement

Has Starcraft II: Heart of the Swarm been a success so far?

If you look at ratings on any site that offers gaming reviews, the answer is yes. While Amazon.com Inc. (NASDAQ:AMZN) might not be a gaming-specific site, it receives the most reviews from the widest audience. At Amazon, StarCraft II: Heart of the Swarm ratings are impressive. It’s rated a 4.5 of 5. Here's the breakdown of the ratings:

5 Stars: 146 Gamers

4 Starts: 31 Gamers

3 Stars: 11 Gamers

2 Stars: 10 Gamers

1 Star: 16 Gamers

Based on these numbers, approximately 88 percent of gamers are at least satisfied with the game, and 68 percent of gamers gave it the highest rating possible. These are excellent numbers. Activision Blizzard could make a game that offers more excitement than Space Mountain and more suspense than an Alfred Hitchcock movie, but there would still be haters. That's why looking at a wide audience is important. It offers an accurate gauge for the quality of the game. If the quality of a game is good, then it has the potential to lead to increased Activision Blizzard gamers as well as increased revenue.

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For those gamers (or investors) who want to look ahead, below is a quick and intriguing teaser for Call of Duty: Ghosts.

What did you think of the teaser?

Battle.net is a second home for many hardcore gamers. The following quote is on Battle.net and indicates the company's goal: "Blizzard Entertainment's vision for the new Battle.net is to unite all Blizzard gamers under the banner of a single, powerful, and advanced online gaming service."

According to Alexa.com, traffic at Battle.net has been average at best over the past three months. Pageviews-per-user has declined 2.72 percent and time-on-site has declined 4 percent. However, the bounce rate has declined 4 percent, which indicates that the content being offered is interesting enough for more people to stay on-site than in the past.

Now let's get to some different types of numbers. Below is a chart comparing basic fundamentals for Activision Blizzard, Electronic Arts Inc. (NASDAQ:EA), and Take-Two Interactive Software Inc. (NASDAQ:TTWO). Activision Blizzard is more impressive than its peers in almost every fundamental category.

	ATVI	EA	TTWO
Trailing P/E	14.40	72.81	N/A
Forward P/E	15.18	15.89	14.79
Profit Margin	24.38%	2.58%	-2.43%
ROE	11.09%	4.15%	-5.27%
Operating Cash Flow	1.52B	324.00M	-4.57M
Dividend Yield	1.30%	N/A	N/A
Short Position	1.80%	5.90%	18.50%

 

Let's take a look at some more important numbers prior to forming an opinion on this stock.
T = Technicals Are Strong

Activision has been a strong performer year-to-date.

	1 Month	Year-To-Date	1 Year	3 Year
ATVI	6.86%	48.63%	28.02%	58.70%
EA	29.45%	55.30%	53.51%	35.03%
TTWO	3.26%	43.69%	34.30%	47.03%

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At $15.57, Activision Blizzard is trading above its averages.

50-Day SMA	14.79
200-Day SMA	12.99

 

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E = Equity to Debt Ratio Is Strong

The debt-to-equity ratio for Activision Blizzard is stronger than the industry average of 0.30.

	Debt-To-Equity	Cash	Long-Term Debt
ATVI	0.00	4.62B	0.00
EA	0.25	1.68B	559.00M
TTWO	0.57	402.50M	335.20M

E = Earnings Have Been Steady

Earnings and revenue have consistently improved on an annual basis.

Fiscal Year	2008	2009	2010	2011	2012
Revenue ($) in millions	3,026	4,279	4,447	4,755	4,856
Diluted EPS ($)	-0.11	0.09	0.33	0.92	1.01

When we look at the last quarter on a year-over-year basis, we see improvements in revenue and earnings.

Quarter	Mar. 31, 2012	Jun. 30, 2012	Sep. 30, 2012	Dec. 31, 2012	Mar. 31, 2013
Revenue ($) in millions	1,172	1,075	841	1,768	1,324
Diluted EPS ($)	0.33	0.16	0.20	0.31	0.40

Now let's take a look at the next page for the Conclusion. Is this stock an OUTPERFORM, a WAIT AND SEE, or a STAY AWAY?

Conclusion

Activision Blizzard is by far the best company in this group. Margins are impressive, cash flow is strong, and revenues have been improving. This isn't to say Activision Blizzard is the ideal investment in the current economic environment, but it should be the best option in this group.

Will EMC Continue to Run Higher?

With shares of EMC Corporation (NYSE:EMC) trading at around $24.88, is EMC an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock's Movement

EMC has underperformed the market year-to-date, which has frustrated investors. However, the past month has been strong – the stock is up more than 7 percent. Investors had been waiting for a catalyst earlier in the year. After a Q1 where revenue increased 5.80 percent year-over-year but earnings declined 1.20 percent year-over-year, there wasn't a lot of reason for investor conviction. This led to EMC making a couple of moves. It now yields 1.60 percent, and it expanded its share repurchase program to $6 billion through December 31, 2015. It should be noted that $3.5 billion will be repurchased by the end of Q2 2014.

EMC will also increase its debt load in order to fuel growth. This may lead to acquisitions in the areas of cloud computing, big data, and/or IT. EMC has displayed strong debt management to date. Despite the companies renewed hunger for growth and the increasing debt, the balance sheet will remain strong for the foreseeable future. Therefore, R&D and innovation opportunities will remain.

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In regards to revenue, EMC has a compounded annual growth rate of 11.55 percent over the past four years. Revenue has consistently improved on an annual basis, but the pace of growth has slowed. The same pattern has been seen for NetApp (NASDAQ:NTAP), but on a different scale. Hewlett-Packard (NYSE:HPQ) has had a more difficult time as its revenue and earnings declined last year as well as last quarter on a year-over-year basis. Hewlett-Packard is struggling with a -11.60 percent profit margin. By comparison, NetApp has a profit margin of 7.98 percent, and EMC has a profit margin of 12.39 percent. NetApp is trading at 28 times earnings, and EMC is trading at 20 times earnings, making EMC look like the better value.

EMC Proven Solution may act as a catalyst going forward. This is private cloud computing. If successful, the rewards could be large. Cloud computing is booming, and this boom is expected to continue for many years. Storage is a concern for most businesses, and cloud computing offers businesses an opportunity to save time and money.

EMC's company culture is above average. According to Glassdoor.com, employees have rated their employer a 3.5 of 5, and 71 percent of employees would recommend the company to a friend. As far as leadership is concerned, 88 percent of employees approve of CEO Joe Tucci. This is an impressive number. It all starts at the top. If a good leader is in place, then the odds of success greatly increase.

In regards to analysts, they love the stock: 33 Buy, 7 Hold, 0 Sell.

On the negative side, there has been a decline in IT spending throughout the industry. Another negative is that operating margin for EMC declined 30 bps year-over-year to 18.9 percent. However, do the positives outweigh the negatives for EMC? That answer will be revealed soon.

Let's take a look at some important numbers prior to forming an opinion on this stock.

T = Technicals Are Strong

EMC has picked up some upside momentum over the past month. Can this momentum continue?

	1 Month	Year-To-Date	1 Year	3 Year
EMC	7.20%	-1.11%	1.54%	34.95%
NTAP	5.84%	14.04%	26.15%	-0.60%
HPQ	13.99%	73.40%	13.34%	-44.21%

At $24.88, EMC is trading above its averages.

50-Day SMA	23.52
200-Day SMA	24.09

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E = Equity to Debt Ratio is Strong

The debt-to-equity ratio for EMC is stronger than the industry average of 0.20.

	Debt-To-Equity	Cash	Long-Term Debt
EMC	0.07	6.53B	1.70B
NTAP	0.48	6.95B	2.25B
HPQ	1.12	13.24B	26.79B

E = Earnings Have Been Strong

Earnings and revenue have consistently improved on an annual basis over the past three years.

Fiscal Year	2008	2009	2010	2011	2012
Revenue ($) in millions	14,876	14,026	17,015	20,008	21,714
Diluted EPS ($)	0.64	0.55	0.88	1.10	1.23

Looking at the last quarter on a year-over-year basis, revenue improved and earnings declined. Both revenue and earnings declined on a sequential basis. However, EMC is now getting more aggressive.

Quarter	Mar. 31, 2012	Jun. 30, 2012	Sep. 30, 2012	Dec. 31, 2012	Mar. 31, 2013
Revenue ($) in millions	5,094.38	5,311.39	5,278.18	6,029.96	5,387.38
Diluted EPS ($)	0.27	0.29	0.28	0.39	0.26

Now let's take a look at the next page for the Conclusion. Is this stock an OUTPERFORM, a WAIT AND SEE, or a STAY AWAY?

Conclusion

To put it simply, even if IT isn't as strong as in the past, demand for cloud computing is expected to increase, and data levels will intensify. EMC is aiming for simplification in all areas, and buyers of any product or service appreciates simplicity. Combining these factors with a 1.60 percent yield, an expanded share repurchase program, and quality leadership, EMC is an OUTPERFORM.

Why Double-Digit Unemployment Persists in Pockets

Based on recent national unemployment rates, it would appear that job creation has improved sharply from when the economy was shedding half a million jobs a month and the jobless rate rose to more than 10%. For much of the country that is true. However, some geographic pockets of unemployment remain in double-digit percentages. Most are in regions of the country with no economic reasons for much positive change. These areas are black holes for people seeking work, even to the extent that these would-be workers have no funds to relocate or the skills to find better work.

The government reported:

Unemployment rates were lower in July than a year earlier in 320 of the 372 metropolitan areas, higher in 38 areas, and unchanged in 14 areas, the U.S. Bureau of Labor Statistics reported today. Forty-one areas had jobless rates of at least 10.0 percent.

Among the most troubled:

Top 5 Financial Companies To Watch For 2014

Yuma, Ariz., and El Centro, Calif., had the highest unemployment rates in July, 34.5 percent and 26.1 percent, respectively.

Some of these cities are adjacent to others where the trouble is nearly as bad. In the central part of California, which sits in from the coast, unemployment is above 10% in Stockton, Fresno, Madera, Merced, Modesto, Visalia and Yuba City. Among those seeking work in these cities are a high percentage of Hispanic or Latino adults. Literacy rates are low, crime rates high and real estate values have cratered. Much of the former jobs base was with the state and local governments. California has had to slash many of these positions to balance its budget.

Similar problems exist in cities that were part of the manufacturing belt in the Midwest. Many of the factory jobs there will never reappear as work has been shipped overseas, or some of the largest employers have lost so many customers that their ability to add jobs is gone. Unemployment remains in the double digits in Muncie and Terre Haute in Indiana, Decatur and Rockford in Illinois, and Detroit, Flint and Saginaw in Michigan. The Michigan cities all sit in a line that used to include car factories and where auto manufacturers were the largest employers.

It is not reasonable to say that the jobs problems in these cities and regions will never improve, but it will take years before their situations get better.

Will Verizon Continue To Rise?

With shares of Verizon (NYSE:VZ) trading around $51, is VZ an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Verizon is a provider of communications, information and entertainment products and services to consumers, businesses and governmental agencies. It operates in two primary segments: Verizon Wireless and Wireline. Verizon Wireless's communications products and services include wireless voice and data services and equipment sales, which are provided to consumer, business and government customers across the United States. Wireline's communications products and services include voice, Internet access, broadband video and data, Internet protocol network services, network access, long distance, and other services. As consumers and companies strive to communicate at increasing rates, Verizon stands to see a rising profits as a main provider. Look for rising communications, information, and entertainment to drive profits for Verizon.

T = Technicals on the Stock Chart are Strong

Verizon stock has witnessed a bullish run over most of the last few years. The stock has pulled-back after this run so it may need a bit more time before initiating its next move. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Verizon is trading between its rising key averages which signal neutral to bullish price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of Verizon options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
Verizon Options	21.50%	23%	21%

What does this mean? This means that investors or traders are buying a small amount of call and put options contracts, as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
July Options	Flat	Average
August Options	Flat	Average

As of today, there is an average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a small amount of call and put option contracts and are leaning neutral to bullish over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Increasing Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Verizon’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Verizon look like and more importantly, how did the markets like these numbers?

	2013 Q1	2012 Q4	2012 Q3	2012 Q2
Earnings Growth (Y-O-Y)	15.25%	-107.21%	14.29%	12.28%
Revenue Growth (Y-O-Y)	4.17%	5.66%	3.92%	3.69%
Earnings Reaction	2.76%	0.58%	2.37%	-2.94%

Verizon has seen mostly increasing earnings and revenue figures over the last four quarters. From these numbers, the markets have been pleased with Verizon’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has Verizon stock done relative to its peers, AT&T (NYSE:T), Sprint Nextel (NYSE:S), T-Mobile (NYSE:TMUS), and sector?

	Verizon	AT&T	Sprint Nextel	T-Mobile	Sector
Year-to-Date Return	17.84%	5.64%	26.81%	15.95%	16.03%

Verizon has been a relative performance leader, year-to-date.

Conclusion

Verizon provides communications products and services through a variety of mediums to consumers and companies around the world. The stock has been on a strong move higher but is now digesting gains so it may need some time. Over the last four quarters, investors in the company have been pleased as earnings and revenue figures have been rising. Relative to its peers and sector, Verizon has been a year-to-date performance leader. Look for Verizon to OUTPERFORM.

Will Research In Motion Continue To Explode?

With shares of Research In Motion (NASDAQ:BBRY) trading around $15, is BBRY an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Research In Motion is a designer, manufacturer, and marketer of wireless solutions for the worldwide mobile communications market. Through the development of integrated hardware, software and services, it provides platforms and solutions for seamless access to information, including e-mail, voice, instant messaging, SMS, Internet and intranet-based applications and browsing.  Its portfolio of products, services and embedded technologies are used by thousands of organizations and millions of consumers around the world and include the BlackBerry wireless solution, the RIM Wireless Handheld product line, the BlackBerry PlayBook tablet, software development tools and other software and hardware. Several economies around the world are growing and adopting new technologies in their daily lives. Also, the company has recently rebranded its products which may offer a boost to their bottom line. With populations around the world incorporating mobile products into their lives at an increasing rate, as one of the top providers, Research In Motion is poised to see a rise in profits.

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T = Technicals on the Stock Chart are Strong

Research In Motion stock has seen a decline in its stock price since reaching highs in 2008. However, the stock is now seeing a monster bounce as the company is reshaping its products and brand. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Research In Motion is trading above its rising key averages which signal neutral to bullish price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of Research In Motion options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
Research In Motion Options	63.52%	23%	25%

What does this mean? This means that investors or traders are buying a very significant amount of call and put options contracts, as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
May Options	Average	Average
June Options	Average	Average

As of today, there is an average demand from call or put buyers or sellers, all neutral over the next two months. To summarize, investors are buying a very significant amount of call and put option contracts and are leaning neutral over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Decreasing Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Research In Motion’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Research In Motion look like and more importantly, how did the markets like these numbers?

	2013 Q1	2012 Q4	2012 Q3	2012 Q2
Earnings Growth (Y-O-Y)	-78.23%	-96.08%	-171.43%	Top Blue Chip Companies To Invest In Right Now -174.44%
Revenue Growth (Y-O-Y)	-41.26	-47.21%	-31.07%	-42.66%
Earnings Reaction	-0.89%	-22.73%	5.04%	-19.05%

Research In Motion has seen decreasing earnings and revenue figures over the last four quarters. From these figures, the markets have been disappointed with Research In Motion’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has Research In Motion stock done relative to its peers, Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), Nokia (NYSE:NOK), and sector?

	Research In Motion	Apple	Google	Nokia	Sector
Year-to-Date Return	30.50%	-19.24%	15.79%	-15.95%	7.06%

Research In Motion has been a relative performance leader, year-to-date.

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Conclusion

Research In Motion provides mobile communications products to growing populations who are adopting these technologies at an increasing rate. The stock has suffered significantly over the last few years but has made significant positive progress in recent months. With the restructuring of the company, earnings and revenue figures are still being worked on. However, investors have not been too impressed by recent earnings reports. Relative to its peers and sector, Research In Motion has been a performance leader, year-to-date. Look for Research In Motion to OUTPERFORM.

Top 10 Financial Stocks To Buy Right Now

If you're feeling good about the market, you're not alone. Take my hand as we go over some of this week's more uplifting headlines.

1. Home on the range
Lennar� (NYSE: LEN  ) picked a timely day to post better-than-expected quarterly results.

The homebuilder's heartier-than-expected profitability came just as the lastest S&P/Case-Shiller data shows that prices for homes in 20 major metropolitan cities posted their largest year-over-year gain for the month of April since the sudsy real estate bubble days of 2006. The 2.5% sequential gain -- from March to April -- is actually the largest monthly increase on record.

Against this welcome backdrop, Lennar came through with another blowout financial report. Pre-tax earnings more than tripled, and the developer's ultimate $0.61 a share in net income was almost twice as much as what Wall Street was expecting.

Top 10 Financial Stocks To Buy Right Now: Fairfax Financial Holdings Ltd (FRFHF.PK)

Fairfax Financial Holdings Limited (Fairfax) is a financial services holding company. The Company, through its subsidiaries, is principally engaged in property and casualty insurance and reinsurance and the associated investment management. The Company�� segments consist of Insurance, Reinsurance, Insurance and Reinsurance Other, Runoff, and Corporate and Other. On December 22, 2011, the Company completed the acquisition of 75% interests in Sporting Life Inc. On August 16, 2011, the Company acquired William Ashley China Corporation. On March 24, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of The Pacific Insurance Berhad. On February 9, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of First Mercury Financial Corporation. In October 2012, its RiverStone runoff subsidiary acquired all the outstanding shares of Brit Insurance Limited.

Top 10 Financial Stocks To Buy Right Now: KKR(KKR)

Kohlberg Kravis Roberts & Co. is a private equity and venture capital firm specializing in acquisitions, leveraged buyouts, management buyouts, and mezzanine investments in large cap companies. The firm will consider investments in all industries globally, with a focus on financial services, infrastructure, and renewable energy. It seeks a board seat in its portfolio companies. The firm holds a controlling interest in its portfolio companies after they go public. It typically holds its investment for a period of five years and more and exits through initial public offerings, secondary offerings, and sales to strategic buyers. Kohlberg Kravis Roberts & Co. was founded in 1976 and is based at New York, New York with additional offices across United States, Europe, Australia, and Asia.

Advisors' Opinion:

• [By Beacon Equity]

  KKR & Co. L.P. (NYSE: KKR) shares are on the rise today following positive comments from Jim Cramer. At last check, the stock was up 1.72% to $17.70 on volume of 2.67 million shares. (NYSE:KKR), (KKR)

10 Best Blue Chip Stocks To Own For 2014: Cheung Kong (1)

Cheung Kong (Holdings) Limited is a Hong Kong-based company engaged in investment holding and project management. The Company�� subsidiaries are engaged in property development and investment, hotel and serviced suite operation, property and project management, and investment in securities. It is also engaged in information technology, e-commerce and new technology. As of December 31, 2011, the Company�� investment properties included retail shopping malls and commercial office properties in Hong Kong, which accounted for approximately 44% and 45%, respectively of the turnover of the Company�� property rental. As of December 31, 2011, the total floor area under the Company�� property management was approximately 88 million square feet. As of December 31, 2011, its subsidiaries included Alcon Investments Limited, AMTD Group Company Limited, Bermington Investment Limited and others.

Top 10 Financial Stocks To Buy Right Now: Porter Bancorp Inc.(PBIB)

Porter Bancorp, Inc. operates as the bank holding company for PBI Bank that provides commercial and personal banking products and services in Kentucky. The company?s deposit products include checking accounts, savings accounts, term certificate accounts, time deposits, negotiable order of withdrawal accounts, money market accounts, fixed rate certificates, and certificates of deposit. Its loan portfolio comprises residential mortgage, commercial, consumer, and agriculture loans; and real estate loans, including commercial and residential real estate, and real estate construction loans. The company also provides drive-through banking facilities, automatic teller machines, night depository, personalized checks, credit cards, debit cards, Internet banking, electronic funds transfers, domestic and foreign wire transfers, travelers? checks, cash management, vault services, loan and deposit sweep accounts, and lock box services. In addition, Porter Bancorp offers personal trus t services, employer retirement plan services, and personal financial and retirement planning services. As of July 28, 2011, it operated 18 full-service banking offices in Kentucky. The company was founded in 1988 and is headquartered in Louisville, Kentucky.

Top 10 Financial Stocks To Buy Right Now: Northwest Bancshares Inc.(NWBI)

Northwest Bancshares, Inc. operates as the holding company for Northwest Savings Bank that offers various banking and consumer finance services. The company offers consumer and commercial deposits, such as checking accounts, savings accounts, money market deposit accounts, term certificate accounts, and individual retirement accounts. Its loan portfolio comprises one- to four-family residential real estate loans, multifamily residential and commercial real estate loans, home equity loans and lines of credit, and commercial business loans, as well as consumer loans, including automobile loans, sales finance loans, unsecured personal loans, credit card loans, and loans secured by deposit accounts. It also offers trust, investment management, actuarial and benefit plan administration, brokerage services, title insurance, and municipal bonds, as well as involves in the ownership and operation of properties. As of December 31, 2009, the company operated 171 community-banking of fices in northwest, southwest, and central Pennsylvania; western New York; eastern Ohio; Maryland; and southeastern Florida. It also operated 51 consumer finance offices in Pennsylvania. The company was founded in 1896 and is headquartered in Warren, Pennsylvania.

Top 10 Financial Stocks To Buy Right Now: PIMCO New York Municipal Income Fund(PNF)

PIMCO New York Municipal Income Fund is a mutual fund launched and managed by Allianz Global Investors Fund Management LLC. The fund is co-managed by Pacific Investment Management Company LLC. It operates as a nondiversified, closed-end management investment company. The fund invests primarily in municipal securities. The fund?s investment portfolio includes investments in hospital, water and sewer, tobacco, state and local general obligations, education, lease, tax, and power sectors. PIMCO New York Municipal Income Fund was formed in 2001 and is domiciled in United States.

Top 10 Financial Stocks To Buy Right Now: Dime Community Bancshares Inc.(DCOM)

Dime Community Bancshares, Inc. operates as the holding company for The Dime Savings Bank of Williamsburgh that provides financial services and loans primarily for multifamily housing. The company accepts various deposit products, including savings accounts, certificates of deposit, money market accounts, interest bearing checking accounts, and non-interest bearing checking accounts. Its loan products comprise multifamily residential mortgage loans, commercial real estate loans, one- to four-family residential mortgage loans, construction and land acquisition loans, and consumer loans. In addition, the company, through its other subsidiaries, involves in the management and ownership of real estate; the sale of non-FDIC insured investment products; and investing in multifamily residential, one to four-family, and commercial real estate loans. As of January 26, 2012, it operated 26 branches located throughout Brooklyn, Queens, the Bronx, and Nassau County, New York. The comp any was founded in 1864 and is headquartered in Brooklyn, New York.

Top 10 Financial Stocks To Buy Right Now: Atlantic American Corporation(AAME)

Atlantic American Corporation, through its subsidiaries, provides life, health, property, and casualty insurance products in the United States. Its property and casualty insurance products include business automobile insurance coverage for state governments, local municipalities, and other large motor pools and fleets, as well as personal property, inland marine, and general liability insurance products. The company also provides surety bond coverage for school bus transportation and subdivision construction, as well as performance and payment bonds. In addition, it offers ordinary and term life insurance, Medicare supplement, and other accident and health insurance products. The company markets its policies through independent agents. Atlantic American Corporation was founded in 1968 and is based in Atlanta, Georgia.

Top 10 Financial Stocks To Buy Right Now: Kingsway Arms Retirement Reside(KWA.V)

Kingsway Arms Retirement Residences Inc. engages in the ownership of retirement home properties in Canada. It primarily owns the Aurora Retirement Centre, a seniors housing facility located in Aurora, Ontario. The company was founded in 1997 and is based in Vaughan, Canada.

Top 10 Financial Stocks To Buy Right Now: National Security Group Inc.(NSEC)

The National Security Group, Inc., an insurance holding company, provides various property and casualty, and life insurance products and services in the United States. It operates in two segments, Property and Casualty Insurance, and Life Insurance. The Property and Casualty Insurance segment primarily provides personal lines coverage, including dwelling fire and windstorm, homeowners, mobile homeowners, ocean marine, and personal non-standard automobile lines of insurance in Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, Oklahoma, South Carolina, Tennessee, and West Virginia, and operates on a surplus lines basis in the states of Louisiana, Missouri, and Texas. The Life Insurance segment principally offers ordinary life, accident and health, supplemental hospital, and cancer insurance products in Alabama, Florida, Georgia, Mississippi, South Carolina, and Texas. The company markets its products through a field force of agents and career agents, as well as thr ough a network of independent agents and brokers. The National Security Group, Inc. was founded in 1947 and is based in Elba, Alabama.

3 Reasons Starbucks Will Continue To Outperform

My local Starbucks (SBUX) is always hounded. Whereas 10 years ago, I would have balked at a $2 drip coffee, today, I freely purchase one multiple times a week. Oh, and the brand in my Keurig - yeah, that's Starbucks too.

Unfortunately, I am late on the Starbucks bandwagon. Over the past 52 weeks, Starbucks has moved more than 46 percent higher, more than 2.5 times the S&P 500's gain of 18 percent. Much of that increase has come this year as the stock moved from the mid-$50s to an all-time high of $74.27. On Friday, it closed at $71.97 - 3 percent below that high. The median analyst target is $79.70, which would represent an 11 percent upside from the current price.

SBUX is valued with a forward price-to-earnings of 22.8 and a trailing P/E of 29.5, not particularly rich compared with competitors Dunkin' Brands (DNKN) - at 23.8 - and Green Mountain Coffee (GMCR) - also at 22.8. Despite the lower forward P/E, Starbucks has much less debt than Dunkin' and has been able to grow quarterly revenues twice as fast - 13.3 percent compared with 5.9 percent.

The below chart discusses Starbucks' 52-week performance. It is hard to not notice the two prior gap openings in the price following earnings reports (circled on the chart). The price opened substantially higher and then retraced all or part of the gap before moving to the upside once more. Interestingly, that mirrors current price action as well.

(click to enlarge)

When looking at the chart, compared with these three factors, I believe Starbucks has the perfect recipe for success. Here are the three main reasons that it will continue to outperform the market: (1) strong revenue growth; (2) a strategic plan for the future; and (3) a management team that can implement.

Strong top-line growth. Recent earnings growth across companies in the market has been accompanied by a struggle to achieve revenue growth. Revenue! growth in the S&P 500 this quarter is averaging at 1.7 percent, though revenue among consumer discretionary companies averaged gains of 7.1 percent. SBUX beat both of these numbers, gaining 13.3 percent in Q3 versus a year ago.

Strong top-line growth also contributes to profit growth in a much more sustainable way than cutting costs. SBUX profits grew 20 percent year-over-year, double the 10.7 percent average among consumer discretionary and substantially higher than the 4.1 percent among other S&P 500 companies.

International growth. Revenues in the Asia region gained by 30 percent in the most recent quarter, a result of the 500 new stores opened this year. And Starbucks has plans for China to become its largest non-U.S. market as the company doubles its locations from 700 to 1,500 by 2015.

And the potential in China is huge. Euromonitor reported that in 2012 an average Chinese person consumed just two cups of coffee a year - compared with 134 cups for the global average. As Starbucks expands more into teas, which encompass 54 percent of China's hot-drink market, it should be able to win customers and build a brand.

That international focus led the company to reshuffle its top executive team in May. Which leads me to my third point…

Management - specifically, Howard Schultz. Howard Schultz is a visionary. And, around him, I believe that Starbucks has one of the best management teams of any public company. In fact, in 2012, Fast Company named Starbucks as one of the 50 most innovative companies - right up there with top-tier tech companies, and one of three food and beverage companies on the list (Chipotle and Chobani were the others).

As Fast Company describes, Schultz empowers employees to create new products - Via, La Boulange, salads and lunch products - that can win new customers, instead of just adding new flavors and brands to current products. Starbucks' management has learned from its failed attempt to expand too quickly and instead of trying to sell the sam! e amount ! of stuff at more stores, it is working to sell more and more stuff at the same number of stores. That is a winning strategy, and as long as Schultz is directing it, the company is in good hands.

I expect Starbucks to continue to outperform the S&P, with a share price that will eventually top $100, as the company continues international expansion and accelerates plans to become a larger source for food options.

However, with uncertainty looming regarding the path of the Federal Reserve's tapering, now is the time to take a measured approach to entering equity positions. I would favor entering one-third of a position at current levels, with another third entered on 5 percent pullbacks.

Source: 3 Reasons Starbucks Will Continue To Outperform

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. (More...)