Why TAL International Is Poised to Outperform

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, freight container lessor TAL International (NYSE: TAL  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at TAL and see what CAPS investors are saying about the stock right now.

TAL facts

Headquarters (founded)	Purchase, N.Y. (1963)
Market Cap	$1.3 billion
Industry	Trading companies and distributors
Trailing-12-Month Revenue	$628.9 million
Management	Chairman/CEO Brian Sondey CFO John Burns
Return on Equity (average, past 3 years)	21.7%
Cash/Debt	$68.3 million / $2.8 billion
Dividend Yield	6.9%
Competitors	COSCO Pacific Seacastle Seaco

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 95% of the 162 members who have rated TAL believe the stock will outperform the S&P 500 going forward.   

Just last week, one of those bulls, TMFChaodan, succinctly summed up the bull case for our community:

TAL International is a containers company. It has ~99% utilization rate, steady cash flow, and a business model that makes it easier to see into the future (lease structures range anywhere from 1-8 years). Their leases also ensure that they have limited liability for damages done to the containers.

Out of their base of 300 customers include all 25 of the world's largest shipping lines, including Maersk. Although there is significant customer concentration, this is the case for most companies in this business.

With the American markets reaching new highs, investors and pundits alike are skeptical about future growth. They shouldn't be. Many global regions are still stuck in neutral, and their resurgence could result in windfall profits for select companies. A recent Motley Fool report, "3 Strong Buys for a Global Economic Recovery", outlines three companies that could take off when the global economy gains steam. Click here to read the full report!

Group: Apple Supplier Violates Labor Laws

A labor right groups put out a report today alleging that Taiwanese company Pegatron Group, a major supplier of parts to Apple (NASDAQ: AAPL  ) , is violating Chinese labor laws in ways including making workers labor long overtime hours "to turn out a scaled-back, less expensive version of the iPhone."

China Labor Watch, or CLW, accuses Pegatron of practices including paying its workers at a rate that provides an income that is less than half the average local monthly income, forcing them into work weeks consisting of 66, 67, and 69 hours on average at the three Pegatron factories CLW investigated. The group also says China's legal limit is 49 hours per week.

Apple said in a statement it was "committed to providing safe and fair working conditions" and would send auditors to three Pegatron facilities this week to investigate the report's claims. The Taiwanese company's chief executive, in a separate statement, also promised to investigate. Apple said its own audit found Pegatron employees making Apple products worked 46 hours per week on average.

The work-hour circumstances that CLW alleges go against Apple's own Supplier Code of Conduct, which "limits work weeks to 60 hours except in unusual circumstances." CLW says that workers in Pegatron's Shanghai factory were forced into declaring they worked fewer hours than they actually did.

"Our investigations have shown that labor conditions at Pegatron factories are even worse than those at Foxconn factories," said CLW executive director Li Qiang in a statement. "Apple has not lived up to its own standards.This will lead to Apple's suppliers abusing labor in order to strengthen their position for receiving orders."

-- Material from The Associated Press was used in this report.

link

Markets Slide Lower on Disappointing Economic Data

The Dow Jones Industrial Average (DJINDICES: ^DJI  ) closed the day down 36 points, or 0.24%, and now sits at 15,512 while the S&P 500 and the Nasdaq also slide lower. The tech-heavy index lost 0.39% while the S&P 500 gave back 0.37% of its value during today's session. The main catalyst for the markets' decline was the disappointing pending home sales report from the National Association of Realtors. June's pending homes sales or the number of contracts signed to purchase an existing home in June declined 0.4% from May's results when the number hit a six year-high. Despite the slight decline, June's homes sales number was still more than 105 higher than were it was in June of 2012, but everyone is now concerned that May's sudden interest rate jump has scared off potential buyers and that the housing industry may see slower growth in the coming months.  

Now let's take a look at a few of today's big Dow losers.

Shares of Microsoft (NASDAQ: MSFT  ) were downgraded this morning by Atlantic Equities from overweigh to neutral. The stock fell 0.25% today on the news as the price target was also lowered from $35 per share to $33. The firm stated that structural headwinds are greater than what had previously been expected. The discounts now being offered for Windows and slow growth in the server business caused the firm to make the downgrade. Although the stock did decline more than 10% just a few weeks ago, shares are still up 18.08% year to date and that's not including the 2.9% dividend yield while the Dow is up 18.45% over the same time frame. Investors should sit tight while the future of the PC plays out and see if the company can gain any ground in the mobile arena.

Another big technology stock declining today was Hewlett-Packard (NYSE: HPQ  ) . The stock lost 1.23%, which could be the result of the downgrade to Microsoft and an article in the The New York Times this weekend, as my colleague John Divine pointed out earlier today. The article highlights the effects the rise of tablet computers is having on the PC industry. It is expected that while 300 million PCs will be shipped this year, 200 tablets will also move out of manufacturers' warehouses. Analysts believe that PCs are still being used on a daily basis as the workhorse, but that the purchase of tablets is causing consumers to postpone buying new PCs. But having said that, most strongly believe that the inevitable refresh cycle will eventually happen.

As a whole, the energy sector slid lower today, while Chevron (NYSE: CVX  ) dropped 1.09% and ExxonMobil (NYSE: XOM  ) declined 0.8%. The decline came as crude prices hardly fell, but natural gas moved lower by 2.55%. Last week's U.S. crude oil inventory report has caused traders some concern as inventories fell; the price of oil also moved lower, which doesn't follow standard supply and demand theories. Furthermore, both Chevron and Exxon are scheduled to report earnings later in the week, so that could be playing on investors' minds as the price of oil highly affects the company's earnings per share. As earnings are released, investors should be watching each company's inventories and what each expects on the production side in the coming months as that will likely also affect the price of oil and earnings down the road.  

More Foolish insight

The Motley Fool's chief investment officer has selected his No. 1 stock for this year. Find out which stock it is in the special free report: "The Motley Fool's Top Stock for 2013." Just click here to access the report and find out the name of this under-the-radar company.

Top Dividend Companies For 2014

Dividend stocks outperform non-dividend-paying stocks over the long run. It happens in good markets and bad, and the benefit of dividends can be quite striking: Dividend payments have made up about 40% of the market's average annual return from 1936 to the present day. But few of us can invest in every single dividend-paying stock on the market, and even if we could, we might find better gains by being selective. That's why we'll be pitting two of the Dow Jones Industrial Average's (DJINDICES: ^DJI  ) dividend payers against each other today to find out which Dow stock is the true dividend champion. Let's take a closer look at our two contenders now.

Tale of the tape
Home Depot (NYSE: HD  ) joined the Dow in 1999 as the lone old-economy stock in a tech-heavy reshuffling, and in the aftermath of the dot-com crash it became the best-performing new addition of the four. Operating out of the suburbs of Atlanta, Home Depot is one of the Dow's youngest components, as it was founded in 1978. Since then, it has grown to become the largest home-improvement retailer in the world (and the fourth-largest retailer in the U.S., period) with more than 2,200 stores located throughout the U.S., Canada, and Mexico -- and a few in China as well. It's often seen as a bellwether for the American housing industry, as so many homebuilders, homebuyers, and specialized contractors shop at Home Depot.

Top Dividend Companies For 2014: TotalFinaElf S.A.(TOT)

TOTAL S.A., together with its subsidiaries, operates as an integrated oil and gas company worldwide. The company operates through three segments: Upstream, Downstream, and Chemicals. The Upstream segment engages in the exploration, development, and production of oil and natural gas. It also involves in the transportation, trade, and marketing of natural gas and liquefied natural gas (LNG), as well as in LNG re-gasification and natural gas storage operations. In addition, this segment engages in the shipping and trade of liquefied petroleum gas (LPG); power generation from gas-fired power plants, nuclear, or renewable energies; production, trade, and marketing of coal, as well as in solar power systems and technology operations. As of December 31, 2010, it had combined proved reserves of 10,695 Mboe of oil and gas. The Downstream segment involves in refining, marketing, trading, and shipping crude oil and petroleum products. It also produces a range of specialty products, s uch as lubricants, LPG, jet fuel, special fluids, bitumen, marine fuels, and petrochemical feedstock. This segment holds interests in 24 refineries located in Europe, the United States, the French West Indies, Africa, and China, as well as operates a network of 17,490 service stations. The Chemicals segment produces base chemicals, including petrochemicals and fertilizers, as well as engages in rubber processing, resins, adhesives, and electroplating activities. TOTAL S.A. was founded in 1924 and is based in Paris, France.

Advisors' Opinion:

• [By Dave Friedman]

  Institutional investors bought 15,892,820 shares and sold 13,997,360 shares, for a net of 1,895,460 shares. This net represents 0.08% of common shares outstanding. The number of shares outstanding is 2,234,829,040. The shares recently traded at $46.80 and the company’s market capitalization is $109,165,864,774.97. About the company: Total SA explores for, produces, refines, transports, and markets oil and natural gas. The Company also operates a chemical division which produces polypropylene, polyethylene, polystyrene, rubber, paint, ink, adhesives, and resins. Total operates gasoline filling stations in Europe, the United States, and Africa.

• [By Glenn]  

  TOT has a market capitalization of $130 billion. Its dividend yield last year of 5% is among the best in the industry. Current P/E ratio of 9.2 seems very attractive compared to the industry average of 12. The stock prices did not participate much in the recent bull market. While smaller sized competitors such as ConocoPhillips (COP), Marathon Oil Corporation (MRO) and Statoil ASA (STO) offered spectacular returns (ranging from 30% to 50%), Total’s return in 2010 was only 2%. One may find that the price will catch up with profits.

Top Dividend Companies For 2014: Paragon Shipping Inc.(PRGN)

Paragon Shipping Inc. provides shipping transportation services worldwide. The company engages in the ocean transportation of various drybulk cargoes and containers. Its fleet consists of 11 drybulk vessels with a total carrying capacity of 747,994 dwt. The company was founded in 2006 and is based in Voula, Greece.

Best Stocks To Invest In 2014: Telecom Corporation of New Zealand Limited(NZT)

Telecom Corporation of New Zealand Limited, together with its subsidiaries, provides telecommunications services, as well as information, communication, and technology services in New Zealand and Australia. Its products and services include local, national, international, and value-added telephone services; mobile services; data, broadband, and Internet services; IT consulting, implementation, and procurement services; and equipment sales and installation services. The company also involves in the retail of telecommunications products and services. It serves residential, business, and government customers. Telecom Corporation of New Zealand Limited was founded in 1987 and is based in Auckland, New Zealand.

Advisors' Opinion:

• [By Chuck Carlson]

  Trading for just seven times earnings and yielding a 10% dividend, it's also nice to know that it's a monopoly in New Zealand. And, on top of that, with gold prices soaring, it's worth noting that the currency most closely correlated with gold is the New Zealand currency (affectionately known as the Kiwi dollar), making the company a nice backdoor play on gold.

Top Dividend Companies For 2014: First Financial Northwest Inc.(FFNW)

First Financial Northwest, Inc. operates as the holding company for First Savings Bank Northwest that provides community-based savings bank services in Washington. Its deposit products include noninterest bearing accounts, NOW accounts, money market deposit accounts, statement savings accounts, and certificates of deposit. The company?s loan products portfolio comprises one-to-four family residential loans, multifamily loans, commercial real estate loans, construction/land development loans, and business loans, as well as consumer loans, including home equity loans, personal lines of credit, second mortgage loans, and savings account loans. First Financial Northwest, Inc., through another subsidiary, First Financial Diversified, Inc., offers escrow services. The company primarily serves customers in the King, Pierce, Snohomish, and Kitsap counties of Washington through a full-service banking office in Renton, Washington. First Financial Northwest, Inc. was founded in 1923 and is based in Renton, Washington.

Top Dividend Companies For 2014: Verizon Communications Inc.(VZ)

Verizon Communications Inc. provides communication services. The company operates through two segments, Domestic Wireless and Wireline. The Domestic Wireless segment offers wireless voice and data services; and sells equipment in the United States. The Wireline segment provides voice, Internet access, broadband video and data, Internet protocol network, network access, long distance, and other services in the United States and internationally. The company serves consumer, business, and government customers, as well as carriers. As of December 31, 2010, its network covered a population of approximately 292 million and provided service to a customer base of approximately 94.1 million. The company was formerly known as Bell Atlantic Corporation and changed its name to Verizon Communications Inc. in June 2000. Verizon Communications Inc. was founded in 1983 and is based in New York, New York.

Advisors' Opinion:

• [By Jonas Elmerraji]

   The sole downside setup we're looking at today is communications giant Verizon (VZ). Even though Verizon isn't a tech stock in the traditional sense, its exposure to mobile phone sales and its scale as an internet service provider means that its price action correlates highly with the rest of the tech sector. But more recently, that correlation has decoupled thanks to a topping pattern in shares.

  Verizon is forming a head and shoulders top right now, a bearish pattern that indicates exhaustion among buyers. The head and shoulders is formed by two swing highs that top out around the same level (the shoulders), separated by a bigger peak called the head. A breakdown below the pattern's support level, called the neckline, triggers the sell signal for this stock. For Verizon, the sell signal comes in right at $41.50…

  The head and shoulders may be a popular pattern, but it's also a potent one: a recent academic study conducted by the Reserve Board of New York found that the results of 10,000 computer-simulated head-and-shoulders trades resulted in “profits [that] would have been both statistically and economically significant.” That's a good reason to keep an eye on how this stock trades for the next week.

• [By Brian Gorban]

   Telecommunications giants Verizon (NYSE: VZ) and AT&T (NYSE: T) are ubiquitous and very well-respected companies that benefit from some compelling competitive advantages. Having well over $110 billion in annual revenue allows both of these firms to benefit from economies of scale, much like Coca-Cola,  while each have well over 100 million wireless subscribers giving them a huge advantage of their distant number three competitor, Sprint, which has approximately 55 million. Perhaps most importantly, management has been very kind in rewarding shareholders through billions in share buybacks and current dividend yields at approximately 5%, well ahead of the average  2% Fortune 500 company. Moreover, with the Nokia Lumia 920 smartphone being received comparatively well by the general public and helping improve margins for both companies as these have less costly subsidies than the more expensive Apple iPhone, expect earnings to improve further in the upcoming quarter. Both of these companies are sitting approximately 10% from their highs, while their fundamentals have only improved, so I think these are two solid dividend companies for the long-term income investor to consider adding to their portfolio.

  I’d like to also say I appreciate you reading my thoughts and reiterate that these are just the views of the blogger and should not serve as a substitute for any professional financial advice or counsel in general. Respectful comments and questions are always welcome below on the comment board.

• [By Richard Young]

  While AT&T (NYSE:T) has been fighting, and losing, the battle to get T-Mobile’s spectrum, Verizon has been piecing together spectrum from far-flung sources, allowing it to expand its 4G LTE operations. Verizon recently purchased more spectrum from a business consortium, and this month VZ bought more spectrum, this time from Cox — a cable provider. Verizon is inking the deals it needs to keep expanding. The company’s stock yields 5.1% today and has broken out of recent resistance on my price chart.

• [By Jim Cramer,TheStreet]

  This is the year for Verizon Communications (VZ). The iPhone is coming in the first quarter, which will lead to a growth spurt.

  The FIOS buildout is largely paid for, and now the company can reap the benefits. The company's half-owned portion of Verizon Wireless will be paying hefty dividends in 2011, and I think we will get a nice dividend boost.

  We're talking about $40 being reasonable, if conservative, giving this stock one of the best risk-reward profiles we've got in the Dow, or the S&P 500, for that matter.

  CEO Ivan Seidenberg has done a remarkable job turning this staid company into a growth vehicle with a nice dividend. It will be a core holding for many mutual funds.

Despite Mother Nature, the Bakken Oil Boom Continues

North Dakota's oil and gas production hit a new all-time high this past May according to recently released data from North Dakota's Industrial Commission. Preliminary estimates indicate that oil production reached 810,129 barrels of oil per day, which is up from the previous record of 793,852 set the prior month. Natural gas production in the state also rose from 861.1 MMcf/d in April to 899.9 MMcfe/d in May. This is great news for the region's producers, which have battled through rough weather all year, but were still able to produce record amounts of oil.

Bakken oil well. Source: Newfield Exploration

This news bodes particularly well for Bakken-focused producers like Continental Resources  (NYSE: CLR  )  and Kodiak Oil & Gas  (NYSE: KOG  ) . Continental has one of the largest positions in the play, with 1.2 million net acres as of the end of last quarter. It's also the largest producer and driller, likely making it one of the driving forces behind May's record results. This means that Continental could produce exceptional quarterly results when it reports earnings on Aug 7.

While not as large as Continental, Kodiak has been growing its presence in the Bakken rather aggressively, which makes it a company to watch. The company just closed a $660-million acquisition of Bakken properties, which, when combined with its organic growth, will enable Kodiak to more than double its daily oil production this year. However, the one rub against Kodiak is that its well costs are high relative to its peers. It has been also working hard to get those well costs down, and it has focused on reducing the average drilling days per well to save money.

One of the biggest problems this year in keeping average drilling days at bay has been the weather. There have been load restrictions in place, as May was one of the wettest on record for North Dakota. Further, April was challenged by heavy snow, which blocked more than 80% of the state's highways. Setting new records in spite of these weather challenges is reason for the industry to celebrate. However, the weather could have had an impact on Kodiak's well costs, which is something to watch when it reports on Aug 1.

Oil and gas producers face many risks, with weather being one that could really impact a company's results if it's focused on just one play. This is where a producer like Newfield Exploration  (NYSE: NFX  ) , for example, can have a leg up on more focused producers. Newfield, which operates in four major U.S. basins, including the Bakken, can move its capital around if it runs into issues with the weather or prices. The plan this year is to spend about 16% of its capex budget on the Bakken, which will produce 25% oil production growth year over year. The flexibility of working in multiple basins has enabled Newfield to work around weather and infrastructure challenges in the Bakken to grow its overall oil and natural gas liquids production by 39% this year.

Looking further afield, the rough weather this spring could still signal problems for others in the industry, particularly oil-field service companies. One company to watch here is Nuverra Environmental Solutions  (NYSE: NES  ) , which had its first quarter report affected by the weather. In fact, "unusually harsh" conditions at its Bakken operations cost the company 13 days of work, or about 15% of the quarter, according to CEO Mark Johnsrud. Overall, weather caused the company to miss revenue estimates by 4.4%, which has weighed on it stock ever since that report. Another weather-related miss could really sink this stock. 

The key takeaway, though, is that oil production in the Bakken continues to rise despite issues with the weather. This should drive top-line results at both Kodiak and Continental, especially when considering oil prices are heading higher, while the region's infrastructure issues have been abating. That means both companies could be setting up to beat Wall Street expectations this quarter.

While the Bakken is booming, weather and pipeline issues have made it a tough area to operate. Energy investors instead might want to look for a more-diversified way to play America's energy boom. The good news here is that The Motley Fool's analysts have uncovered  a leading provider of equipment and components used by drilling and production operations, positioning the company to profit from this energy boom in a big way. To get the name and detailed analysis of this company that will prosper for years to come, check out the special free report, "The Only Energy Stock You'll Ever Need." Don't miss out on this limited-time offer and your opportunity to discover this under-the-radar company before the market does. Click here to access your report -- it's totally free.

How Much Nuclear Waste Does Your State Hold?

One of the biggest critiques of nuclear energy is that it produces radioactive waste in the form of used nuclear fuel, or UNF. While the amounts are relatively small -- just 20 metric tons per power plant annually -- they remain radioactive for periods of time that are difficult for humans to comprehend. The waste adds up across the 100 nuclear reactors currently in operation across the United States. At last count, the country's atomic fleet had produced approximately 69,720 metric tons of UNF over the past four decades.

More than 50 sites across the country are licensed for dry cask storage of spent nuclear fuel. Source: NRC.gov  

Where does it all go? Power plants first store waste on-site in steel-lined concrete pools. After maxing out capacity, however, waste is stored in large dry casks similar to the ones pictured above. They may look intimidating, but there has never been a radiation leak since dry storage techniques were implemented in 1986.

Phew! No worries. But really, do you live in a state that hoards radioactive waste?

State-by-state breakdown
You may think that just because your state doesn't have a nuclear power station it doesn't have any nuclear waste. Of course, you may be wrong. While 31 states have an operating reactor, 38 contain at least some nuclear waste. That means seven states have really persuasive leaders! Here's how it plays out for each state (numbers in metric tons):

Source: Nuclear Energy Institute.   

If you live in one of the 12 white-colored states on the map above, you're in the clear. For the rest of us, living within the same borders as spent fuel is just reality. Obviously, the states with more generating capacity will generate and therefore store more waste. The top 10 states hold 64% of all UNF in the United States.

State

Metric tons of UNF

Illinois	9,010
Pennsylvania	6,290
South Carolina	4,210
New York	3,720
North Carolina	3,670
Alabama	3,320
Florida	3,040
California	2,970*
Georgia	2,690
New Jersey	2,660

Source: Nuclear Energy Institute.
*California's total was updated as of Dec. 31, 2012 and is higher than what appears on the map. Sorry, California.

Who are the biggest culprits? Exelon (NYSE: EXC  ) is responsible for the majority of the waste currently being held in Illinois and Pennsylvania (that comes naturally with 19,000 MW of annual nuclear capacity). It has managed to persuade Idaho to store used fuel from its Three Mile Island reactors, however. The reactors and storage facility are more than 2,400 miles away. Sneaky, sneaky.

Duke Energy (NYSE: DUK  ) feeds the nuclear-heavy grids of North Carolina, South Carolina, and Florida. Not surprisingly, it ranks second in the nation with 11,350 MW of nuclear capacity. Rounding out the top three is Southern (NYSE: SO  ) with 8,280 MW of annual capacity. The company maintains three facilities in Georgia and Alabama, although it doesn't necessarily contribute the most spent fuel in either state. Either way, the figures in the preceding table make plenty of sense when you look at where the largest atomic powerhouses produce their power.

Is it really all bad news?
The good news that gets relatively little attention is that each power generator pays into the national Nuclear Waste Fund with every fuel purchase. If every nuclear power plant were decommissioned tomorrow, the industry would need approximately $31.9 billion. Luckily, more than $22.5 billion has already been funded -- the remainder will be collected over the next 20 years.

That still doesn't solve the problem of the waste itself. Just as the industry transitioned from pool to dry cask storage out of necessity, I believe it will eventually make the leap to full fuel recycling technology. Partners Hitachi and General Electric (NYSE: GE  ) have pioneered the PRISM reactor -- a generation 4 reactor (all reactors in use today are generation 3 or lower) -- which is powered by spent nuclear fuel. Perhaps the pair will receive funding directly from the Nuclear Waste Fund for their technology in the next decade or two.

Still skeptical? Before you build a bunker in your backyard, stop and take a deep breath. You shouldn't feel any differently now than you did before you opened this article. There is certainly a UNF storage problem forming on the horizon, but to date there have been zero leaks concerning energy-related waste with current technology. Admittedly, only novel reactor designs, such as PRISM, can truly make a dent in the pile of nuclear waste your state is hoarding. I'm optimistic that it is only a matter of time before one is built. Are you?

Nuclear energy may not belong in your portfolio. Fortunately, The Motley Fool's analysts have uncovered an under-the-radar company that's dominating its industry -- and it isn't radioactive. This company is a leading provider of equipment and components used in drilling and production operations and is poised to profit in a big way from it. To get the name and detailed analysis of this company that will prosper for years to come, check out the special free report: "The Only Energy Stock You'll Ever Need." Don't miss out on this limited-time offer and your opportunity to discover this company before the market does. Click here to access your report -- it's totally free.

Why Altra Holdings Shares Got Crushed

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of power transmission products maker Altra Holdings (NASDAQ: AIMC  ) plummeted 17% today after its quarterly results and outlook disappointed Wall Street. 

So what: The stock has soared over the past year on solid earnings growth, but today's second-quarter results -- adjusted EPS stayed flat on a 3.6% drop in revenue -- coupled with downbeat guidance for the full year is forcing Mr. Market to sober up. On a positive note, gross margin actually expanded 20 basis points despite the slump in sales as management did a good job to reduce costs in the quarter.

Now what: Management now sees full-year EPS of $1.52-$1.64 on revenue of $715 million-$730 million, down from its prior view of $1.75-$1.85 on revenue of $740 million-$750 million. "[W]e expect that the second half of the year will be in line with the comparable period a year ago," said CEO Carl Christenson. "Given the lower-than-expected results in the first half of the year and the lack of any apparent catalyst for significant economic growth in the second half, we are revising our guidance for the full year." When you couple that demand uncertainty with Altra's not-so-cheapish P/E of 25, Fools might want to wait for more of a pullback before jumping in.

With the U.S. relying on the rest of the world for such a large percentage of our goods, many investors are ready for the end of the "made in China" era. Well, it may be here. Read all about the biggest industry disrupters since the personal computer in "3 Stocks to Own for the New Industrial Revolution". Just click here to learn more.

Sirius XM Smokes Its Shorts

Sirius XM Radio (NASDAQ: SIRI  ) just keeps growing.

The satellite radio provider delivered robust quarterly results this morning. Revenue climbed 12% to $940.1 million, just ahead of the $934.4 million that Wall Street was forecasting. A 9% increase in subscribers over the past year was the major contributor to the top-line spurt, though it also helps that Sirius XM is squeezing a little more revenue out of the average listener.

Earnings of $126 million -- or $0.02 a share -- matched expectations.

As a scalable model, once again we're seeing results get rosier as we work our way down the company's financial statements. Pre-tax profits rose 47%, and adjusted EBITDA clocked in 19% higher.  

We knew that this would be a good quarter the moment that Sirius XM revealed that it closed out the period with 715,000 net new subscribers two weeks ago. We now know that it was 715,762 net additions during the last three months, making this Sirius XM's most successful quarter in terms of base growth since the merger of Sirius and XM five summers ago. 

Naysayers were already starting to come around. There were just 325.6 million shares of Sirius XM sold short as of mid-July, and that's the lowest number of shorts since late last year.

It's not just the frustrated pessimists placing buy orders to cover their short positions. Sirius XM revealed this morning that it has spent $1.3 billion this year to buy back 391 million shares. The only negative point there is that the number of fully diluted shares outstanding over the past year has only shrunk from 6.51 billion to 6.48 billion in that time. The media darling is going to have to do a lot more buying -- and a lot less issuing -- if it seriously wants to make a dent in its huge share count.

Sirius XM had boosted its subscriber guidance two weeks ago, so the other thing worth watching would be if it increased its other outlook metrics this morning. We got one out of three, as Sirius XM boosted its adjusted EBITDA forecast while keeping revenue and free cash flow the same. 

Despite the growing number of cheaper streaming alternatives, Sirius XM is as sticky as ever. Folks buying new cars with free satellite radio trial subscriptions continue to convert at a 45% clip, and the good news is that the monthly churn of subscribers already on the service fell to just 1.7%.

Once again, Sirius XM delivers.

A revolution that may be bigger than satellite radio
With the U.S. relying on the rest of the world for such a large percentage of our goods, many investors are ready for the end of the "made in China" era. Well, it may be here. Read all about the biggest industry disrupters since the personal computer in "3 Stocks to Own for the New Industrial Revolution." Just click here to learn more.

Why Polycom Shares Plunged

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Polycom (NASDAQ: PLCM  ) have fallen by 13% today. Yesterday, the company's CEO resigned abruptly, which came amid allegations of some "irregularities" in the former exec's expense reports. That, along with with some disappointing guidance in last afternoon's earnings report, has sent analysts scurrying from the stock.

So what: Polycom's revenue of $345.2 million beat the $341.4 million consensus, and earnings of $0.15 per share were $0.01 better than the consensus as well. However, guidance of $330 million to $340 million for the third quarter was well below the $355.5 million consensus, as was the $0.10 to $0.12 adjusted EPS guidance, which undershot the $0.16 per share analyst consensus.

In the aftermath, RBC analyst Mark Sue downgraded Polycom to sell status, citing "mismanaged and inconsistent execution" for the company's declining margins and the unexpected departure of former CEO Andrew Miller as reasons for his new price target of $10. However, he also noted that the company's strong cash position could make it a target of activist investors.

Now what: It's tough to say where Polycom will go from here with this uncertainty on the horizon in terms of both growth and executive change. However, falling revenue and earnings don't provide investors with any particular reason for optimism. I'd sit on the sidelines for the time being while the company works through its problems.

Want more news and updates? Add Polycom to your watchlist now.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.

Why Sourcefire Shares Got Hot

Existing Home Sales Drop 1.2%

Sales of existing homes fell 1.2% to a seasonally adjusted annual rate of 5.08 million for June, according to a National Association of Realtors (NAR) report released today.

After jumping a revised 3.4% in May, analysts had expected sales to head even higher to an annual rate of 5.27 million for June. Compared to June 2012, sales were up 15.2% and they remain near a 3.5-year high. The numbers include completed transactions on single-family homes, townhomes, condominiums, and co-ops.

As sales slowed, the housing inventory rose 1.9% to 2.19 million existing homes. At the current sales rate, this represents a 5.2-month supply of existing homes, 4% higher than May's supply.

Sales of previously occupied homes in June reflect contracts that were mostly signed in April and May, when mortgage rates were lower. The NAR also noted that first-time buyers, who usually drive healthy markets, aren't participating as much in the current recovery. They made up only 29% of buyers in June, below the 40% that is typical.

But even as sales tapered off, the median sales price moved higher for the 16th straight month of year-over-year increases. June's $214,200 median price tag is 13.5% higher than a year ago, putting sellers in a strategic position. "Rising values have improved the position of homeowners, and 16% of Realtors surveyed in June report they worked with a client that previously had an underwater mortgage," said NAR President Gary Thomas in a statement.

The median time on the market fell four days from May to 37, and is nearly half the time houses hung out on the market a year ago.

-- Material from The Associated Press was used in this report.

link

Tablets Are Killing Laptops Even Faster Than Expected

Not even two months after IDC predicted that tablets would outsell laptops next year, another research firm, NPD DisplaySearch, says IDC's forecast was too pessimistic. Apple (NASDAQ: AAPL  ) , Samsung, and other leaders will ship 256.5 million tablets worldwide this year, up 67%, versus 203.3 million laptops.

Surprised? Don't be. Users have good reason to like the handheld form factor, says Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova in the following video. A tablet can easily substitute for a TV. Meanwhile, some slates, such as Microsoft's Surface Pro, use external keyboards to transform into laptop look-alikes.

Add it all up, Tim says, and it's clear the tablet market is moving far faster than anyone had predicted. That's great news for Apple, which needs the volume to overcome lower margins. Netflix (NASDAQ: NFLX  ) could also win because of how it has perfected the art of delivering high-quality video across a variety of devices.

Do you agree? Please watch the video to get Tim's full take, and then let us know if you own a tablet, and if so, how you're using it.

The next big iThing
Apple has a history of cranking out revolutionary products... and then creatively destroying them with something better. Read about the future of Apple in the free report, "Apple Will Destroy Its Greatest Product." Can Apple really disrupt its own iPhones and iPads? Find out by clicking here.

The Surprising Stocks Behind the Dow's Gain Today

As often happens, occasions that Wall Street looks forward to with bated breath turn out to be non-events in terms of market reaction. Some investors believed that today's testimony from Federal Reserve Chairman Ben Bernanke might result in the same levels of volatility that we saw last month, when the Fed had its first serious discussion about easing off on the quantitative-easing accelerator pedal. But for the most part, Bernanke didn't say anything that his audience didn't already know, and the market traded in a relatively narrow range, with the Dow Jones Industrials (DJINDICES: ^DJI  ) finishing up 19 points and narrowly missing a record high.

Still, the market's quiet day didn't stop a few stocks from picking up serious ground. DuPont (NYSE: DD  ) was the hot stock in the Dow, soaring more than 5% to levels not seen in more than a decade on reports from CNBC that Nelson Peltz and his Trian Fund Management investment firm had taken a large stake in the chemical giant. Neither Peltz nor Trian confirmed or denied the report, but the stock's price jump indicates how much shareholders are banking on the activist investor's reputation for squeezing more value from companies he targets.

Bank of America (NYSE: BAC  ) also made sizable gains, rising almost 3% as the bank's combination of solid net income and cost-cutting measures helped the bank beat its earnings estimates. Perhaps more importantly, Bernanke's comments seemed to stabilize the bond market, which has been extremely turbulent in recent months as fears of the Fed's QE exit pushed interest rates higher. With the 10-year Treasury bond trading below 2.5% today, the possibility of one last run at relatively low mortgage rates could create big demand for home loans as buyers rush to get what they might see as a last chance at cheap financing.

Finally, outside the Dow Industrials, airlines had a good day, with United Continental (NYSE: UAL  ) jumping 8% and Delta Air Lines (NYSE: DAL  ) posting a 3% gain. Despite recent trouble in making fare hikes stick, airlines have done a great job of boosting fee income and posting solid bottom-line earnings lately. Moreover, United Continental's announcement today that it will pioneer the commercial use of the Split Scimitar winglet design in a retrofit of its fleet of 737-800 aircraft. The move could help improve efficiency by 2%, which should help United's earnings rise even further.

No matter which industry you think will produce the top returns, the best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.

Best Cheap Stocks To Watch For 2014

Home prices are rising again

By a lot, too. The Case-Shiller Housing Index is up almost 11% in the last year. Some cities are booming twice as fast. Los Angeles, Detroit, and Las Vegas home prices are up 20% in the last year. All of these are the biggest annual gains since 2006, when the housing bubble peaked.

We're not in a new housing bubble. Prices are bouncing off the deepest plunge since the Great Depression, and measured against rents and incomes, homes still look cheap. Bloomberg shared an amazing statistic this week: Detroit home prices are still so low that "it takes a mortgage rate of 35.8 percent to make renting more economical [than owning]."

But don't hold your breath for these gains to continue.

Home prices are surging because the supply of homes on the market is low. The number of homes on the market will now cover only about four months of sales at current rates. That's the lowest since 2004:

Best Cheap Stocks To Watch For 2014: S&U(SUS.L)

S&U Plc provides consumer and motor finance services in England, Wales, and Scotland in the United Kingdom. It offers home credit consumer finance and motor finance. The company also provides rental and other retail trading services, as well as insurance brokerage services. It serves approximately 140,000 customers. The company was founded in 1938 and is based in Solihull, the United Kingdom.

Best Cheap Stocks To Watch For 2014: Beacon Minerals Ltd(BCN.AX)

Beacon Minerals Limited engages in the exploration and development of mineral properties in Australia. The company primarily explores for gold mineralization, as well as for uranium and nickel ores. It principally holds interest in approximately 300 square kilometers of prospective ground in 3 tenements in the Barlee gold project located in the Murchison District, Western Australia. The company is based in West Perth, Australia.

Top Stocks To Buy Right Now: Pacific Ethanol Inc.(PEIX)

Pacific Ethanol, Inc. produces and markets low carbon renewable fuels in the United States. It sells ethanol to gasoline refining and distribution companies; provides ethanol transportation, storage, and delivery services in the Western United States, primarily in California, Arizona, Nevada, Utah, Oregon, Colorado, Idaho, and Washington; and markets ethanol co-products, including wet distiller grains and syrup to dairy operators and animal feed distributors. The company also provides operations, maintenance, and accounting services to a cellulosic integrated bio-refinery in Boardman, Oregon. Pacific Ethanol, Inc. was founded in 2003 and is headquartered in Sacramento, California.

Men's Wearhouse Will Buy Joseph Abboud

Men's Wearhouse (NYSE: MW  ) likes the way Joseph Abboud looks. Likes it so much, in fact, that it just bought the company.

On Thursday, Men's Wearhouse announced it has signed a definitive agreement to acquire Joseph Abboud parent company JA Holding from its owner, private equity firm J.W. Childs Associates, for $97.5 million, cash. With JA Holding comes the Joseph Abboud, JOE Joseph Abboud, Joseph Abboud BOYS, and Joseph Abboud Home brands, which are carried by department stores and specialty retailers in the U.S. and "more than 50 countries worldwide." Also coming with the purchase is JA Holding's U.S. factory, and the 450 employees who work there.

In making this acquisition, Men's Wearhouse brings in-house the company founded by its own Chief Creative Director, Mr. Joseph Abboud himself. New Men's Wearhouse CEO Doug Ewert pronounced himself "thrilled to reunite Joseph with his iconic brand at Men's Wearhouse," asserting that this purchase "accelerates our strategy of offering exclusive brands with broad appeal at attractive prices." 

As for the affect on the company itself, Ewert predicts that buying JA Holding will "enhance our margins and profitability and become accretive to our earnings in fiscal year 2014."

PC Stocks Drop During the Day and Keep Falling After-Hours

Nokia Replaces BlackBerry at Gi Group

Chalk up another win for Nokia (NYSE: NOK  ) .

Following on the heels of reports last week, that Russia's Mobile Telesystems has halted orders of Apple iPhones for resale to its customers, Nokia announced that one of its own customers has chosen the Nokia Lumia smartphone to replace BlackBerry (NASDAQ: BBRY  ) mobile devices used by its workforce.

On Tuesday, Nokia confirmed that Italian human resources firm Gi Group "has chosen Nokia Lumia as its business smartphone, replacing BlackBerry" among its workforce of more than 800 employees in 19 countries around the world. Henceforth, Gi Group employees will be equipped with Lumia 925s, 820s, and 620s, all able to "seamlessly operate with Gi Group's Microsoft Outlook mail and Microsoft Office applications."

Gi Group HR manager Barbara Cottini was quoted citing the need "to connect with colleagues and access and edit Microsoft Office documents, wherever they happen to be" as a key factor in choosing the Microsoft (NASDAQ: MSFT  ) -powered Lumia over the BlackBerry.

Despite the good news, Nokia shares traded down 3% Tuesday, to $4 a share.

Smithfield Foods: An Arbitrage Opportunity With Additional Upside Potential

Smithfield Foods Inc. (NYSE: SFD) has formally and legally agreed to marry Hong Kong-based Shuanghui International. Interestingly, however, there still were two other serious suitors for Smithfield when the matched pair came to terms and the indications are that they may not have been given sufficient time to make their strongest case. That's not all, a matchmaker of sorts -- a Mr. Smith, clearly not one to be confused with cupid -- has walked onto the stage, hoping to find a better match for the betrothed, certainly one bearing more valuable gifts. As things now stand, stockholders in Smithfield have the proverbial bird in hand, but may have the option of trading that in for the two in the bush once bagged. In other words, although nearing the end game, this drama still offers investors the rare combination of a relatively attractive arbitrage opportunity and the potential of perhaps much more. In this article, we detail the merger agreement that's already been signed and assess the free call option as represented by the possibility of a superior offer. We think the opportunity looks particularly attractive in the prevailing low interest rate, high stock-market volatility environment.

The Merger Agreement

On May 29th, Virginia-based Smithfield Foods, the world's biggest pork processor and hog farmer, announced that it had entered into a definitive merger agreement to be acquired by Shuanghui, China's top pork producer, in a transaction valued at $7.1 billion, including debt. This equates to $34 a share in cash, which represents a premium of approximately 31% over the closing price on May 28th, the last trading day prior to the deal's announcement. Consummation of the merger is subject to shareholder approval, antitrust clearance, and other customary closing conditions. It's also subject to a CFIUS (Committee on Foreign Investments in the United States) review. The agreement does not contain a financing condition and the two marriage partners expect to close before 2013 concludes! . Smithfield is entitled to a termination penalty payment of $275 million if Shuanghui decides to walk away. On the other hand, it has to pay Shuanghui a penalty of either $75 million or $175 million, depending on the exact reason (detailed below), if it decides to terminate the deal.

Door Not Shut on the Other Two Suitors

According to the proxy statement filed by Smithfield on June 18th, it was still in serious negotiations with two other suitors -- described as Company A and Company B -- in late May when Shuanghui announced its intention to abandon the pursuit of the Virginia-based meat products concern if a merger agreement were not executed by May 28th. Interpreting this as a firm deadline, and in view of its assessment that Company A and B, identified by various media sources as Charoen Pokphand Foods Pcl of Thailand and JBS SA of Brazil, were proceeding in "deliberate fashion," with B indicating that it couldn't execute and announce a transaction until at least June 13th, Smithfield did, in fact, sign the merger agreement with Shuanghui on May 28, 2013.

That said, pursuant to the terms of a limited "go-shop" provision in the agreement, Smithfield and its representatives "may initiate, solicit and encourage any alternative acquisition proposals from two third parties who provided acquisition proposals to the Company or its representatives during a specified period prior to the date of the Merger Agreement (the "Pre-Existing Bidders"), provide nonpublic information to such Pre-Existing Bidders and participate in discussions and negotiations with such Pre-Existing Bidders regarding alternative acquisition proposals." Moreover, prior to approval of the merger proposal by Smithfield shareholders, the company may, upon terms and subject to the conditions set forth in the merger agreement, provide information to and engage in discussions or negotiations with a third party (other than the pre-existing bidders) if that party has made a bona fide wri! tten acqu! isition proposal that has not been solicited after the date of the merger agreement and the Smithfield board determines that such acquisition proposal would reasonably be expected to constitute, result in, or lead to, a superior proposal and that failure to take such action would be inconsistent with the board fiduciary duties. The termination penalty stemming from a deal with the pre-existing bidders would be $75 million, whereas a deal with another third party would cost $175 million.

The agreement gives Shuanghui as many as seven business days to counter a superior proposal, and its chairman Wan Long said on May 31st that it may raise its offer to meet other bids, if necessary.

A Matchmaker Enters the Mix

On June 17th, Starboard Value LP, a New York-based investment advisor that has a history of pushing for changes at companies in which it has an equity interest, sent a long letter to Smithfield Foods announcing a roughly 5.7% stake and expressing its opinion that the $34 takeover price vastly undervalued the company's worth. The letter outlined in considerable detail a sum-of-the-parts assessment that suggested that Smithfield's three major businesses -- hog production, international, and pork -- were conservatively worth between $9 billion and $10.8 billion after tax, or $44 to $55 per share, representing a 29%-62% premium to the Shuanghui deal. Significantly, too, in a television appearance that morning, Jeffrey Smith, Starboard's managing member, indicated that he essentially wanted to serve as an unofficial facilitator of a sum-of-the-parts transaction. Mr. Smith further noted that he had already had conversations with several interested parties. The activist shareholder took yet another step forward on July 12th, announcing that it had hired two financial advisers, Moelis & Co. and BDA Advisors Inc., to explore alternative deals.

Earlier this year, in March, another shareholder, Continental Grain Co., had pressed Smithfield to break up the company, stating that the t! hree busi! nesses would achieve a stock price of $40. Around that time, six Wall Street analysts estimated a post-breakup value of $26 to $48 a share.

An Arbitrage Opportunity…

Shuanghui International Holdings has already secured binding financial commitments for the transaction, with the New York branch of the Bank of China providing a $4 billion term loan and Morgan Stanley (MS), which is advising the buyer on the takeover, providing $3.9 billion. Funding will not be a problem. The two intended partners notified the Federal Trade Commission and the Antitrust Division of the Department of Justice of the proposed merger in early June and the applicable waiting period expired at midnight on July 11, 2013. Antitrust considerations should not be an issue either. A little more challenging, perhaps, could be the requisite CFIUS (the Committee on Foreign Investment in the United States) review, which is focused on assessing takeovers by foreign entities for national security implications.

Under most circumstances, the acquisition of a meat products company would probably barely raise an eyebrow, but the potential largest takeover of a U.S. company by a Chinese buyer will undoubtedly trigger some opposition in the nation's capital. Indeed, some senators have already raised the specter of food safety as a national security concern. Politicians will probably take this opportunity to rail and grandstand about China's uneven playing field with respect to protecting its companies against foreign takeovers, but the government is unlikely to block the deal. A joint voluntary notice was filed with CFIUS on June 18th, and a review and investigation (if necessary) shouldn't take nearly the maximum of 75 days. Even assuming the deal closes around year-end, investors stand to earn a low-risk 3.3% (from July 12th's closing price of $32.91) over the next roughly five months, which annualizes to about 7.9%. A closing in September or October seems likelier, though.

…With Additional Upside Potential

Smi! thfield Foods' stock price reflects Wall Street's obvious skepticism that a superior takeover price will materialize, with the shares trading little changed from before Mr. Smith joined the party. The price did rise in reaction to the revelation of an activist investor but subsequently receded, probably reflecting both the skepticism and the protectionist noise emanating from Washington, D.C. The stock also reflects the expectation that the deal now on the table will be consummated, trading very close to the buyout price. That said, the existence of the two "pre-existing bidders," the allowances made in the merger agreement, and the possibilities afforded by Starboard Value's presence inject some speculative appeal to SFD. Important, too, the implied call option comes at virtually no cost.

Strategic Alternatives

The simplest alternative would be the purchase of Smithfield stock, with 100 shares at Friday's closing price of $32.91 costing $3,291. Assuming the deal with Shuanghui closes, the investor will earn a relatively low-risk 3.3%, which annualizes to 13.2% if payment is received within three months and 7.9% if received around year's end. An investor looking to make a smaller capital outlay might consider buying a call option. Options would generate a very handsome return if a superior offer materialized in relatively short order. The holder could also exercise his option to buy the stock if it were determined that additional time is necessary. The modest time premium in SFD options makes this alternative reasonably attractive. Moreover, the small capital outlay dramatically limits the downside risk, which may be particularly important in the current environment.

Summary

Arbitrage plays are never completely risk free, underscoring the old maxim that there is no such thing as a free lunch; there is always the risk that the Smithfield/Shuanghui pact unravels even without a superior alternative. The termination penalty of $275 million, or about $2 a share, which is in ! escrow, w! ould provide a cushion, though. That said, we think the probability of Smithfield still being an independent concern at year-end is very low. All in all, we fully expect investors in the stock to earn a minimum of 3.3%, and perhaps considerably more.

Source: Smithfield Foods: An Arbitrage Opportunity With Additional Upside Potential

Disclosure: I am long SFD. 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...)

A Better Way to Invest in LNG

Let's face it, if you have followed the energy industry much lately, you probably have considered investing in liquefied natural gas, or LNG, exports. With so much added LNG trade expected in the next several years, who can blame you? But investing in LNG export facilities may not be the best way to do it. Not only have companies planned to build more export capacity than what will be needed over the next couple years, but commodity pricing also poses a risk. 

There is another way to play the LNG game, though, and it may prove to be a more lucrative investment: LNG tankers. LNG specialty tankers command very high prices in comparison to other tankers in the shipping business, and a much smaller number of companies are involved in the LNG shipping business. With a few years to go before LNG ship traffic takes off, Fool.com contributor Tyler Crowe explains why this could be a good time to invest in this industry. Watch the video below where he outlines why tankers are poised to do well in the future, and selects a few companies to keep an eye on.

These companies, just like several other investments in the energy space right now, can be big winners for your portfolio if you do your homework. Let us help you get started on your analysis by checking out our special free report on our chief investment officers "Top Stock for 2013". Just click here to access the report -- it's completely free!

 

Why Were Big-Bank Stocks the Dow's Big Winners Today?

For the last couple of months, the Dow Jones Industrials (DJINDICES: ^DJI  ) have proven vulnerable even to good economic news, as fears about the Federal Reserve pulling the plug on monetary stimulus have outweighed the positive impact of an improving economy. Yet, even though this morning's employment report initially caused some of those fears to reawaken, stock investors eventually decided that the benefits of an improving picture for workers outweighed the negative impact of the Fed's departure. Although bond rates soared and gold plunged, the Dow added 147 points, and the broader market posted similar gains of about 1%.

When you look at the stocks that gained the most today, financial stocks come to the forefront. The top two gainers were American Express (NYSE: AXP  ) and JPMorgan Chase (NYSE: JPM  ) , with gains of about 2.3% each. Bank of America (NYSE: BAC  ) wasn't much further back with a 1.8% jump.

The big banks all stand to profit from improving economic conditions. For AmEx, the biggest driver of success is consumer spending, and with more people returning to work, prospects for further growth from the card company should improve, with fewer unemployed cardholders missing payments or dropping their cards. In particular, a surge in part-time jobs could help AmEx's Bluebird prepaid-card program, which is the company's attempt to reach out to underbanked customers who could use a low-cost, convenient prepaid option to cut their fees and get better access to their money.

Meanwhile, for banks, investors have been worried about the impact of rising rates on their mortgage-banking segments. Higher rates have already led to a reduction in refinancing transactions, and with JPMorgan and Bank of America getting a substantial amount of income from mortgage fees, today's big move up in rates might be seen as a negative. But offsetting that is the fact that, once rates move up, it doesn't matter as much to the mortgage market how much they rise; as long as short-term interest rates remain low, it's a potential profit enhancer for the banks, because they'll be able to charge more for business loans and other lending tied to higher long-term rates, while getting cheap funding from deposits paying little or no interest.

Still, one concern on the radar is the implementation of the Fed's version of Basel III regulations, which will impose new rules on the entire banking industry. In addition, the Fed is likely to go even further than Basel III did with respect to the largest banks, including JPMorgan and B of A, requiring excess capital-to-assets ratios, and minimum amounts of equity and long-term debt to facilitate wrapping up banks in the event of failure.

Banks are incredibly complicated companies, and investors have certainly gotten blindsided by financials before. But if financial stocks can avoid getting hammered too much by regulatory moves, then fundamentals in the economy appear to be moving in their favor, and that could help send stock prices up further.

Many investors are terrified about investing in big banking stocks after the crash, but the sector has one notable standout. In a sea of mismanaged and dangerous peers, it rises above as "The Only Big Bank Built to Last." You can uncover the top pick that Warren Buffett loves in The Motley Fool's new report. It's free, so click here to access it now.

Facebook Picks Up Where Google Left Off

In exactly one week, Google (NASDAQ: GOOG  ) is killing its popular Google Reader RSS service. When the search giant announced the closure earlier this year, it sent millions of users scrambling for alternatives. With social media services supplanting RSS as content feeds for many users, Google didn't think it was worth maintaining any longer.

To that end, The Wall Street Journal is reporting that Facebook (NASDAQ: FB  ) is preparing to launch a Reader service geared toward mobile consumption. Simply known as Reader internally, the social network has been working on the service for over a year. It's intended to display news content, and reportedly resembles the popular Flipboard app, where users can swipe to flip pages like a digital magazine.

Despite Google Reader's imminent death, there's no indication of when Facebook might choose to unveil its newest mobile offering. Facebook might never launch the service. The company held a media event last week, and the timing would have been perfect for a Reader announcement. Instead, the company launched video sharing on Instagram.

A Facebook Reader service would be notable on a number of levels. It would be the latest replication of popular services that the social network has launched in recent memory. The company has adopted hashtags, which have been widely popularized by rival Twitter, and Instragram video similarly resembles Twitter's Vine app. Facebook's Poke app was also a clear knock-off of Snapchat.

Mark Zuckerberg reportedly wants Facebook to focus more on published content to supplement the user-generated content that has historically been the feature presentation. Professional rival LinkedIn (NYSE: LNKD  ) is also moving toward content, acquiring Pulse in April for $90 million. Shortly thereafter, LinkedIn redesigned its LinkedIn Today social news page in order to focus on content discovery through different channels.

As RSS services like Google Reader continue to decline, social media services like Google+, Facebook, LinkedIn, and Twitter are stepping up to be the primary content sources in a grab for ad dollars. LinkedIn relies on advertising to a lesser extent, though, with its marketing segment comprising just 23% of revenue last quarter. That broader transition will transfer control of content distribution from an open standard to companies who will soon call the shots, for better or for worse.

Google Reader may be at its end, but Facebook Reader may just be beginning.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.

This Week's 5 Dumbest Stock Moves

Top 10 Performing Stocks To Watch Right Now

The following video is from Thursday's Investor Beat, in which host Chris Hill, and analysts Jeff Fischer and Jason Moser dissect the hardest-hitting investing stories of the day.

McDonald's (NYSE: MCD  ) and UnderArmour (NYSE: UA  ) report earnings on Friday. Will McDonald's continue its recent rebound? Is UnderArmour the next Nike? In this Installment of Investor Beat, our analysts explain why they're watching McDonald's and UnderArmour.

McDonald's turned in a dismal year in 2012,�underperforming the broader market by 25%. Looking ahead, can the Golden Arches reclaim its throne�atop the restaurant industry, or will this unsettling trend continue? Our top analyst weighs in on McDonald's future in a recent�premium report�on the company. Click here now�to find out whether a buying opportunity has emerged for this global juggernaut.

Top 10 Performing Stocks To Watch Right Now: Canterbury Park Holding Corporation(CPHC)

Canterbury Park Holding Corporation conducts pari-mutuel wagering operations and hosts unbanked card games at its Canterbury Park racetrack and card room facility in Shakopee, Minnesota. The company operates in three segments: Horse Racing, Card Room, and Concessions. The Horse Racing segment operates year-round pari-mutuel wagering on simulcast horse races, and live thoroughbred and quarter horse races held on a seasonal basis. The Card Room segment offers unbanked card games, which include poker and casino games. The Concessions segment provides food and beverage services for simulcast and live racing, and the card room, as well as for the special events. The company also offers facilities for special events, such as snowmobile races, arts and crafts shows, trade shows, concerts, fundraisers, automobile shows and competitions, vehicle and boat storage, and private parties. In addition, it provides advertising signage space; leases excess parking lot space for various aut omotive activities and vehicle storage; and sells various daily pari-mutuel publications. Canterbury Park Holding Corporation was founded in 1994 and is based in Shakopee, Minnesota.

Top 10 Performing Stocks To Watch Right Now: Garmin Ltd.(GRMN)

Garmin Ltd., together with its subsidiaries, designs, develops, manufactures, and markets global positioning system (GPS) enabled products and other navigation, communication, and information products for the automotive/mobile, outdoor, fitness, marine, and general aviation markets worldwide. The company offers a range of automotive navigation products, and various products and applications designed for the mobile GPS market; GPS enabled handheld products for hunters, hikers, geocachers, outdoors enthusiasts, cyclists, and golfers; dog tracking systems; tracker systems; and training assistants for athletes. It also provides handhelds, network products and multifunction displays, fixed-mount GPS/chartplotter products, instruments, fish finders, radars, autopilots, VHF radios, marine networking products, and sounder products. In addition, the company offers GPS-enabled navigation, VHF communications transmitters/receivers, multi-function displays, electronic flight instrumen tation systems, automatic flight control systems, traffic advisory systems and traffic collision avoidance systems, terrain awareness and warning systems, instrument landing system receivers, surveillance products, audio panels, and cockpit datalink systems. The company?s sells its products through a network of independent dealers and distributors, as well as through original equipment manufacturers. Garmin Ltd. was founded in 1990 and is based in Schaffhausen, Switzerland.

Advisors' Opinion:

• [By Jeff Brown]

  Use of GPS devices is soaring, which should be good for an established player like Garmin (symbol GRMN), one of the trailblazers in global positioning system navigation. But Garmin, a leader when GPS mainly served pilots and boat owners, faces growing competition now that navigation chips are embedded in everything from smart phones to tablets to cameras.

  The result is a shrinking business. Sales of automotive and mobile devices, together accounting for about 55% of Garmin's revenue, fell from $1.67 billion in 2010 to $1.49 billion in 2012. Although the Switzerland-based company is pushing hard to increase sales of in-dash navigation systems for vehicles, it warned in its recent annual report that revenues from the critical automotive business, which makes dashboard and portable units for vehicles, are likely to continue falling. Overall, revenues fell by 2% in 2012, and Garmin's earnings of $2.78 per share were far below the $3.51 per share the company made in 2009.

  The firm's well-regarded high-end products, such as navigation systems for aircraft, enjoy a relatively secure market because stringent regulation by the federal government keeps new entrants at bay. But those markets are not big enough to offset Garmin's challenges in consumer products. At $34.72, the stock sells for 14 times estimated 2013 profits, which are expected to be down from last year. That's too high. (Share prices are as of April 12.) The shares yield a generous 5.2%, and Garmin has gradually raised its dividend in recent years. Although the company says it is confident that it can maintain its payout, a fall in the share price could easily offset the income from Garmin's dividend.

• [By Jonas Elmerraji]

  Garmin is a bit of an unlikely name on this list. While the other names are staid blue-chip stocks, Garmin's $6.4 billion market capitalization puts it squarely in mid-cap territory. Even so, the special opportunity in this stock is presenting a big buying opportunity for Garmin right now.

  Garmin makes global positioning devices for cars, boats, planes and fitness enthusiasts. That exposure to all corners of the GPS market is significant—and it's the sole differentiator that keeps Garmin head and shoulders above peers. It means that Garmin is able to pour R&D into big-ticket electronics (such as the $50,000 G1000 avionics suite for small planes) and then transition the tech to the more margin-sensitive consumer market. The result is net profit margins that consistently scrape up against the 20 percent mark.

  In spite of recent successes for Garmin—namely the growth of its innovative fitness offerings in the last two years—investors don't see how this stock can continue to perform at a high level. That's a big part of why Garmin is consistently one of the most heavily shorted mid-cap names on the Nasdaq. A spotless balance sheet with approximately $3 billion in cash and investment and no debt makes Garmin an exciting opportunity this year. As I write, the firm pays out a 5.43 percent dividend yield—the biggest on this list.

10 Best Insurance Stocks To Invest In 2014: Erg(ERG.MI)

ERG S.p.A., through its subsidiaries, engages in refining and marketing, power and gas, and renewable energy businesses primarily in Italy. Its Refining and Marketing business supplies and processes crude oils, as well as sells refined products; and distributes and markets fuel and specialties, such as lubricants, liquefied petroleum gas, and bitumen through its retail network of approximately 3,300 service stations. The company?s Power and Gas business is involved in the production and marketing of thermoelectric power, steam, and gas. It owns and operates a 528 megawatts capacity power plant fuelled by a gas obtained from a process of gasification of asphalt; and owns the Centrale Nord plant with a capacity of 480 megawatts, including the combined-cycle repowering plant fuelled by natural gas. The company, through a joint venture, also engages in the development of a liquid natural gas regasification plant at Priolo, Sicily. ERG S.p.A.?s Renewable Energy Sources busine ss generates electricity from renewable sources with an installed capacity of 520 megawatts through wind farms, as well as through its photovoltaic plant; and treats solid and liquid waste on behalf of third parties. In addition, the company operates logistics systems; and in the wholesale market through selling refining products, such as diesel, fuel oils, LPG, and bitumens to the retailers. ERG S.p.A. was founded in 1938 and is headquartered in Genoa, Italy. ERG S.p.A. is a subsidiary of San Quirico S.pA.

Top 10 Performing Stocks To Watch Right Now: ANSYS Inc (ANSS.O)

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

ANSYS Workbench

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

Multiphysics

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

Structural Mechanics

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

Fluid Dy namics

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

Explicit Dynamics

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

Electromagnetics

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

System Simulation

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

Simulation Process and Data Management

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

Academic

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

High-Performance Computing

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

Geometry Interfaces

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

Meshing

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

Apache Design Low-Power Electronic Solutions

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

Top 10 Performing Stocks To Watch Right Now: Essential Energy Services Ltd (ESN.TO)

Essential Energy Services Ltd., together with its subsidiaries, provides oilfield services that are related to the ongoing servicing of producing wells and new drilling activity for oil and gas producers in western Canada and Colombia. The company operates in two segments, Well Servicing, and Downhole Tools and Rentals. The Well Servicing segment offers well completion and production/workover services through its fleet of coil tubing rigs, nitrogen and fluid pumpers, service rigs, rod rigs, and hybrid drilling rigs. As of March 12, 2012, it had a fleet of 49 coil tubing rigs, 10 nitrogen pumpers, 15 fluid pumpers, 57 service rigs, 14 rod rigs, and 5 hybrid drilling rigs in Canada; and 2 coil tubing rigs, 2 nitrogen pumpers, 2 service rigs, and 3 rod rigs in Colombia. The Downhole Services and Rentals segment engages in the sale and rental of downhole tools, including the Tryton MSFS, retrievable and permanent packers, flow control accessories, liner hanger systems, bridge plugs, casing scrapers, cement retainers, and selective/straddle simulation tools for completion, production, and workover projects. This segment is also involved in the rental of oilfield equipment comprising drill pipe, heavy weight pipe, collars, degassers, blowout preventer rams, spools, pipe racks, handling tools, stabilizers, and reamers. Essential Energy Services Ltd. is headquartered in Calgary, Canada.

Top 10 Performing Stocks To Watch Right Now: Concurrent Computer Corporation(CCUR)

Concurrent Computer Corporation provides solutions that enable the seamless delivery, management, and monetization of video on any screen. Its screen-independent video delivery and media data solutions create a 360 degree view of the consumer video experience, which is built on video firsts and patented technology. The company provides advanced advertising to customers in the cable, telecommunications, wireless, Web, advertising, and content development industries by harnessing the full potential of video. Its video solutions consist of software, hardware, and services for streaming video and collecting media data based on cross services data aggregation, logistics, and intelligence applications; and real-time products consist of Linux and other real-time operating systems, and software development tools to various companies seeking high-performance, real-time computer solutions in the military, aerospace, financial, and automotive markets around the world. Concurrent Comp uter Corporation was founded in 1966 and is headquartered in Duluth, Georgia.

Top 10 Performing Stocks To Watch Right Now: Gwr Resources Inc. (GWQ.V)

GWR Resources Inc., a junior exploration company, engages in the acquisition, exploration, and development of mineral properties in Canada. The company explores gold, copper, and magnetite properties. Its principal property includes the Lac La Hache porphyry copper-gold-silver/skarn copper-magnetite-gold-silver property located in the Quesnel Trough in British Columbia. The company was incorporated in 1987 and is based in Lac La Hache, Canada.

Top 10 Performing Stocks To Watch Right Now: Fab-Form Industries Ltd. (FBF.V)

Fab-Form Industries Ltd. develops, manufactures, and distributes fabric-based technology to form concrete footings, foundations, and walls for building structures. The company manufactures forming products using poly membranes to form and damp-proof concrete. Its products include Fastfoot footing forms, Fastbag point load footing forms, and Fast-Tube column forms. The company operates in Canada and the United States, and Europe. Fab-Form Industries Ltd. was incorporated in 1995 and is headquartered in Surrey, Canada.

Top 10 Performing Stocks To Watch Right Now: (SOTL.NS)

Savita Oil Technologies Limited manufactures and sells petroleum products in India and internationally. The company?s products include transformer oils, liquid paraffin and white oils, lubricating oils/greases, petroleum jellies, optic fiber cable filling compound, emulsifiable polyethylene wax, and waxes, as well as specialty wax emulsion for leather finishing, water based paints, and printing inks. It also generates and sells wind power. The company, formerly known as Savita Chemicals Limited, is based in Mumbai, India.

Advisors' Opinion:

• [By Quickel]

  The company supplies industrial lubricants, waxes and other industrial consumables. It has been showing a scorching growth in net profit for some time now. With a good promoter, sound business model and a great dividend record, it is poised to benefit from industrial growth in the coming year. It is also attractively priced.

Top 10 Performing Stocks To Watch Right Now: Donegal Group Inc.(DGICB)

Donegal Group Inc., through its subsidiaries, offers personal and commercial lines of property and casualty insurance to businesses and individuals in the United States. The company?s personal lines of insurance products include private passenger automobile insurance, which provides protection against liability for bodily injury and property damage arising from automobile accidents, and protection against loss from damage to automobiles owned by the insured; and homeowners insurance that offers coverage for damage to residences and their contents from a range of perils, including fire, lightning, windstorm, and theft, as well as covers liability of the insured arising from injury to other persons or their property. Its commercial lines of insurance products comprise commercial automobile policies that provide protection against liability for bodily injury and property damage arising from automobile accidents, and protection against loss from damage to automobiles owned by the insured; commercial multi-peril policies, which offer protection to businesses against various perils primarily combining liability and physical damage coverages; and workers? compensation policies that provide benefits to employees for injuries sustained during employment. Donegal Group Inc. markets its insurance products through a network of approximately 2,200 independent insurance agencies. As of December 31, 2010, it wrote business in 22 states of the United States. The company was founded in 1986 and is headquartered in Marietta, Pennsylvania.

Why ClickSoftware Shares Plunged

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of ClickSoftware (NASDAQ: CKSW  ) have plunged today by as much as 13% after the company warned that second-quarter results would fall short of expectations.

So what: Revenue in the quarter is expected to come in around $24.5 million, translating into just 9% growth. The company's adjusted net loss should be in the range of $0.06 to $0.08 per share. Analysts had been modeling for $27.8 million in sales and positive earnings per share of $0.03.

Now what: The company said customers are transitioning to its cloud-based software-as-a-service, or SaaS, sales faster than expected. As customers contemplate the shift, contracts are being delayed as they conduct due diligence. ClickSoftware sees the trend as positive in the long term, although some short-term bumps may be in store. As a result, the company is reducing its full-year outlook and 2013 revenue should be $110 million to $115 million.

Interested in more info on ClickSoftware? Add it to your watchlist by clicking here.

The amount of data we store every year is growing by a mind-boggling 60% annually! To make sense of this trend and pick out a winner, The Motley Fool has compiled a new report called "The Only Stock You Need to Profit From the NEW Technology Revolution." The report highlights a company that has gained 300% since first recommended by Fool analysts but still has plenty of room left to run. To get instant access to the name of this company transforming the IT industry, click here -- it's free.

2 Stocks Set to Win From Rising Mortgage Rates

The U.S. housing market's own Freddie Mac recently released its 2013 First Quarter Refinance Report, and while I'm not going to argue that there isn't certainly more exciting reading out there, there are some very interesting tidbits throughout the report that offer up some clues as to the state of the housing market and some stock ideas that Foolish investors may be able to glean from it all.

The refi boom is winding down
"We estimate that refinances will make up approximately two-thirds of single-family originations this year and about one-half in 2014, compared to about 70 to 75 percent in 2012."

This makes sense. While the Fed has committed to keeping short-term interest rates near zero until we see unemployment reach 6.5%, all this taper talk is playing out in the mortgage markets, which are already on the move back up. Given the volume we've seen to this point along with Freddie's projections, it certainly seems like the refinance boom is coming to a close.

"My home is an ATM" syndrome
"An estimated $8.1 billion in net home equity was cashed-out in the first quarter of conventional prime-credit home mortgages, down from an estimated $8.2 billion in the fourth quarter and substantially less than during the peak cash-out refinance volume of $84 billion during the second quarter of 2006."

Just amazing, the difference between now and then. When you hear the statement "people were treating their homes like ATMs," this is the indisputable proof that this was in fact the case. From $84 billion down to $8.1 billion is just a phenomenal difference.

"The program has helped about 2.5 million refinancing borrowers since its inception through March 2013. HARP loans made up just over 20 percent of first quarter refinance loans purchased by Freddie Mac and Fannie Mae. ... Homeowners who refinanced through HARP during the first quarter of 2013 will save an average of $4,300 in interest payments during the first 12 months, or about $358 every month."

Hey, every little bit helps. And it's also worth noting that HARP has been extended through 2015, which means that there are still borrowers out there who can take advantage of a serious saving opportunity.

The house always wins
I like to believe there's a pretty good chance that after all of this refinancing, many people are going to stay put for a while. Home repairs and renovations should see a nice little boost in the coming years, and Home Depot  (NYSE: HD  ) is a great way for investors to gain worthwhile exposure to this sector.

Home Depot is the largest player in the space with a market capitalization more than twice the size of competitor Lowe's, and thanks to this scale it maintains better margins, making it more profitable. And management is keeping an eye out for shareholders as well. Share count is down 14% over the last five years and the stock pays a 2% dividend to boot. Home Depot has pulled in almost $6 billion in free cash flow over the last 12 months, and at 25 times earnings, today the market is as optimistic about the stock as I am. But for investors looking five to seven years out, Home Depot is a great stock to build a position opportunistically over time.

Venti-size returns
Coffee giant Starbucks  (NASDAQ: SBUX  ) is a phenomenal business in many ways. Management is doing everything they can to make Starbucks that home away from home for consumers while at the same time bringing Starbucks into the home via things like the Verismo machine and a laser focus on the channel development (packaged goods) segment.

Between international opportunities and three big acquisitions over the past couple of years, management's target of 10% or greater revenue growth on a sustainable annual basis seems more achievable now than ever before. As households start to see a little more money in their bank accounts, Starbucks is one of those creature comforts with a relatively low hurdle in convincing people that they have the money to treat themselves to something that they may not have otherwise.

With the stock at 35 times earnings, the market's feeling the love for the 'Bucks today. But this is one of the most recognized and reputable brands in the world with a beautiful recurring revenue stream. Investors can expect the 1.2% yield to grow over time, and I believe the stock will continue its market-beating ways for years to come.

The Foolishly Freddie bottom line
Of course, these aren't the only stocks that should benefit from rising mortgage rates. But they are two quality companies that are ideal for long-term, Foolish investors looking to become part-owners of businesses that have and will continue to stand the test of time. Make sure to add them to your watchlist today.

In addition to profiting from rising mortgage rates, you could also stand to profit from our increasingly global economy -- and it can be as easy as investing in your own backyard. The Motley Fool's free report "3 American Companies Set to Dominate the World" shows you how. Click here to get your free copy before it's gone.

Click here to follow Jason on Twitter.