Is Lennar Worth the Risk?

With shares of Lennar Corp. (NYSE:LEN) trading at around $42.11, is LEN an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock's Movement

The homebuilders are at an interesting point in time. There are many reasons to be optimistic as well as pessimistic. The biggest positives are improvements in housing starts and average-selling-price growth. The biggest negatives are tight credit, supply chain constraints, and increased costs, including softwood lumber, gypsum, tar roofing, insulation, and concrete.

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Looking at Lennar specifically, this is a company that has solid margins, a 0.40 percent yield (peers don't offer any yield), improvements in revenue and earnings, and a strengthened balance sheet. Lennar has shed an enormous amount of overhead. Currently, it's slowing the pace of homebuilding in California, Arizona, and Florida. Lennar management wants more land to become available first. This conservative approach might hamper growth potential, but it will help margins.

The biggest concerns for Lennar at the moment are increased costs, subpar cash flow, and a lack of resiliency. In regards to the latter, the stock was hit much harder than peers in 2008/early 2009. However, Lennar is being managed much better this time around.

Now let's take a look at some comparative numbers. The chart below compares fundamentals for Lennar, PulteGroup (NYSE:PHM), and Toll Brothers Inc. (NYSE:TOL). Lennar has a market cap of $8.06 billion, PulteGroup has a market cap of $8.53 billion, and Toll Brothers has a market cap of $5.95 billion.

	LEN	PHM	TOL
Trailing   P/E	12.92	28.52	12.16
Forward   P/E	18.00	14.79	24.93
Profit   Margin	16.51%	5.87%	24.90%
ROE	19.11%	14.25%	17.21%
Operating   Cash Flow	-$613.70 Million	$916.07 Million	-$312.70 Million
Dividend   Yield	0.40%	N/A	N/A
Short   Position	22.80%	6.80%	5.20%

 

The large short position on Lennar stands out. Let's take a look at some more important numbers prior to forming an opinion on this stock.

E = Equity to Debt Ratio Is Normal         

The debt-to-equity ratio for Lennar is close to the industry average of 1.10. Though it's not overly concerning, it's not as strong as the debt-to-equity ratios as its peers, especially Toll Brothers. It's interesting to note that Toll Brothers also has a much smaller short position. When interest rates increase, Toll Brothers will the best situated.

	Debt-To-Equity	Cash	Long-Term Debt
LEN	1.25	$1.18 Billion	$5.09 Billion
PHM	1.14	$1.59 Billion	$2.60 Billion
TOL	0.69	$793.58 Million	$2.16 Billion

 

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T = Technicals Are Strong  

Lennar has been a top performer over a three-year time frame. Both Lennar and PulteGroup have outperformed Toll Brothers by wide margins over the past three years. However, Toll Brothers will likely hold up best if the market heads south.  

	1 Month	Year-To-Date	1 Year	3 Year
LEN	8.67%	9.11%	50.40%	115.00%
PHM	17.60%	22.91%	124.50%	70.38%
TOL	10.97%	9.16%	37.32%	57.40%

 

At $42.11, Lennar is trading above all its averages.

50-Day   SMA	40.30
100-Day   SMA	40.21
200-Day   SMA	37.49

 

E = Earnings Have Been Strong                              

Earnings are listed as strong due to 2012. However, it would be difficult to see sustainable earnings growth over the next few years.

	2008	2009	2010	2011	2012
Revenue   ($)in   billions	4.58	3.12	3.07	3.10	4.11
Diluted   EPS ($)	-7.00	-2.45	0.51	0.48	3.11

 

When we look at the previous quarter on a year-over-year basis, we see an increase in revenue and earnings.

	2/2011	5/2012	8/2012	11/2012	2/2013
Revenue   ($)in   millions	724.86	930.16	1.10B	1.35B	989.95
Diluted   EPS ($)	0.08	2.06	0.40	0.56	0.26

 

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

T = Trends Might Support the Industry

Once again, housing starts and average-selling-price growth are positives. On the other hand, there are several economic concerns at the moment, which include weak GDP, sequester, austerity, and interest rates. The latter two are more potential concerns, but they're likely to become realities in the future.

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Conclusion

As long as rates remain low, homebuilding stocks have the potential to continue their surge. On the other hand, while there are differences between now and the mid-2000s, there are also many similarities, which is a potential red flag.

Treasuries Risk Shown as Fed Distorts Stocks Correlation

U.S. government bonds are acting more like equities than any time since before the credit crisis, making Treasuries a hidden risk to investors becalmed by the prospect of the Federal Reserve prolonging stimulus into 2014.

Ten-year Treasuries are moving 0.024 percent for every one-percent change in the Standard & Poor's 500 Index (SPX) in the same direction, the first time that's happened since July 2007, based on a risk measure known as beta. Prior to this month, the gauge averaged minus 0.12 over the past decade, meaning that bonds have historically moved in the opposite direction.

Treasuries are rising along with stocks as economists say the Fed will keep suppressing borrowing costs to support the world's largest economy after a 16-day government shutdown slowed growth. While government debt was a haven as the U.S. endured the worst recession in seven decades, primary dealers such as Barclays Plc (BARC) and Goldman Sachs Group Inc. say the gains this month show that the Fed's $85 billion of monthly bond purchases are masking the risk of owning fixed-income securities as the recovery in America takes hold.

"Treasuries are just not worth the risk," Thomas Higgins, the Boston-based global macro strategist at Standish Mellon Asset Management Co., which oversees $167 billion of fixed-income investments, said in a telephone interview on Oct. 23. "The economy is certainly not going gangbusters, but the Fed will step away at some point, and that will remove one of the forces of lower yields."

Higgins said Standish Mellon has been reducing its stake in Treasuries this month and plans to keep selling as long as yields on 10-year notes, which fell to a three-month low of 2.46 percent last week, remain below 3 percent.

Bond Buying

The gains in Treasuries in the past month, which pushed down yields on 10-year securities from the highest in two years of 3 percent on Sept. 6, upended the traditional relationship with stocks. On Oct. 16, the day U.S. lawmakers reached an agreement to end the shutdown, the beta for government debt on a total-return basis relative to the S&P 500 turned positive, based on the 26-week moving average compiled by Bloomberg.

While the shutdown restored confidence among debt investors and prompted economists in a Bloomberg survey on Oct. 17-18 to predict the Fed will keep buying $45 billion of Treasuries and $40 billion of mortgage-backed securities each month for at least five more months to buffer the economy, the perils of lending to the U.S. have also increased in the bond market.

Since mid-2008, the amount of outstanding U.S. debt has more than doubled to an unprecedented $11.6 trillion as the government increased borrowing to finance deficits and mitigate the fallout from the financial crisis.

Loss Potential

Potential losses due to rising yields on the longest-dated Treasuries are now approaching the highest level since at least 1996, Bank of America Merrill Lynch indexes show.

The gauge known as duration, which calculates how much prices change when yields rise or fall, for Treasuries due in 10 years or more has climbed to 16.03, within 3.6 percent of the all-time high of 16.6 in May. The reading is about 50 percent higher than the average during the decade before the Fed began its so-called quantitative easing in 2008.

Investors buying Treasuries today face a loss of 2.1 percent if yields for the 10-year notes increase to 2.8 percent by year-end, the median yield estimate from 65 forecasters in a Bloomberg survey. That would deepen this year's losses of 4.5 percent, based on index (BFCIUS) data compiled by Bank of America.

In the past quarter-century, the debt securities have posted annual losses on just three occasions -- in 2009, 1999 and 1994 -- and returned 57 percent in the past five years. That's more than six times the 8.6 percent gain for the S&P 500 over the same span, data compiled by Bloomberg show.

Not Easy

"It's not as easy as it was to own Treasuries," Christopher Sullivan, who oversees $2.2 billion as chief investment officer at United Nations Federal Credit Union in New York, said in a telephone interview. "Over the longer term there is less upside and a lot of risk to go along with that."

Treasuries rose last week, with 10-year yields falling seven basis points, or 0.07 percentage point, to 2.51 percent, according to Bloomberg Bond Trader prices. The 10-year yield was 2.52 percent today as of 1:47 p.m. in Tokyo.

It's premature to assume that yields are bound to increase after reports last week signaled the U.S. economy still needs the Fed's support to ensure its recovery, said Jack McIntyre, a Philadelphia-based money manager at Brandywine Global Investment Management LLC, which oversees $44.5 billion.

Uncertain Landscape

Payrolls rose by 148,000 in September, versus the median forecast for an 180,000 gain by 93 economists in a Bloomberg News survey. The data indicated the economy lost momentum leading up to the government shutdown, which S&P estimates shaved at least 0.6 percent off fourth-quarter growth.

U.S. consumer confidence sank to an eight-month low in the week ended Oct. 20, while more households were pessimistic about the economy than at any time in the past year, according to the Bloomberg Consumer Comfort Index.

"The economic landscape is uncertain at best," McIntyre said in a telephone interview on Oct. 24. "There is still room for Treasury yields to move lower."

Bill Gross, the co-chief investment officer at Pacific Investment Management Co., the world's largest bond fund manager, predicts that 10-year Treasury yields will remain close to 2.5 percent. Policy makers are scheduled to meet Oct. 29-30 to consider whether to slow its bond buying.

The Fed "probably won't be tapering anytime soon," Gross said on Oct. 22 in a Bloomberg Radio interview from Newport Beach, California, where Pimco is based.

Market Complacency

Price swings of Treasuries indicate most bondholders aren't anticipating a sudden jump in borrowing costs. The implied volatility for U.S. government bonds as measured by the Bank of America Merrill Lynch MOVE index has fallen 45 percent in the past month to the lowest since May, when fluctuations were the least since data began 25 years ago.

The diminished volatility is a warning to Michael Gavin, a New York-based market strategist at Barclays, because it underscores the complacency that's pervaded the debt markets as the Fed flooded the economy with cheap money.

Ten-year Treasuries are at their most expensive in four months based its so-called term premium, a valuation model used by the Fed that is calculated by using interest-rate expectations, economic growth and inflation. The gauge, which indicates a security is overvalued when its reading is below 0.4 percent, was 0.14 percent for 10-year notes.

Not Safe

"Bonds are increasingly shifting from risk relievers to securities that add more risk for investors," Gavin, whose firm is one of the 21 primary dealers of U.S. government securities that are obligated to bid at Treasury auctions, said on Oct. 21. "The bond market isn't as safe as it was."

Yields on 10-year Treasuries will increase to 2.75 percent by year-end as the economy regains the momentum it lost because of the government shutdown, Jan Hatzius, the chief economist at New York-based Goldman Sachs, wrote in a report dated Oct. 22.

U.S. gross domestic product will increase by 2.6 percent next year, a full percentage point more than in 2013, based on a Bloomberg survey of 75 economists. By 2015, growth is projected accelerate 3 percent, which would be the fastest in a decade, the polls show.

Corporate profits for S&P 500 companies have almost doubled since 2008, and earnings in each of the next two years will increase by more than 10 percent, data compiled by Bloomberg show. That's more than twice as much as the 4.8 percent increase that analysts project for 2013.

'Better Opportunities'

Of the 244 companies in the index that have reported third-quarter results, 76 percent posted higher-than-estimated earnings, the data show. While earnings have helped fuel a 23 percent advance in the S&P 500 to a record this year, its price-earnings ratio of 16.7 is still less than the average multiple of 19.3 for the past 15 years.

"Because of the growth outlook there are opportunities that provide compensation plus a margin of safety that Treasuries do not," Jeffrey Schoenfeld, the chief investment officer at Brown Brothers Harriman & Co., which oversees $33 billion, said on Oct. 23. "There are better opportunities than Treasuries right now if you do your homework."

Schoenfeld said the New York-based firm sold of all its holdings of Treasuries and is investing in financial company bonds and inflation-protected securities.

U.S. government debt has already lost some of its appeal among foreign investors. They were net sellers of Treasuries for five-straight months ended August, disposing of $133 billion in that span, last week's Treasury data showed.

Latent Risk

The streak is the longest since 2001 as China, the largest overseas U.S. creditor, reduced its holdings to $1.268 trillion, the least since February.

The last time Treasuries moved as closely with equities was in 2007, the year before the collapse of the housing market sparked the deepest U.S. contraction since the Great Depression.

Treasuries soared and stocks plummeted the following year as the risk relationship between the two assets was restored. With the economy recovering from the depths of that recession, Treasuries may be more vulnerable to a selloff this time.

When Fed Chairman Ben S. Bernanke signaled in May that the central bank could taper its stimulus in "the next few meetings" if the U.S. posts sustained growth, Treasuries swooned and caused yields on the 10-year notes to surge by more than a percentage point in 3 1/2 months.

"The interest-rate risk is significant for Treasuries at these low yield levels," Zach Pandl, a Minneapolis-based senior interest-rate strategist at Columbia Management Investment Advisers, which oversees $340 billion, said in a telephone interview. "It doesn't take much. We've already had a reminder of how violent things can get this year."

Will AbbVie Earnings Stay Healthy?

AbbVie (NYSE: ABBV  ) will release its quarterly report on Friday, and with its stock having jumped considerably since it started trading as a separate entity, investors are hoping for more good news from the drugmaker. Yet even if AbbVie earnings contract slightly from pro forma figures from the previous year, the company has some promising prospects in its pipeline to help it drive long-term growth in future years.

AbbVie has historically relied on a single drug, Humira, for much of its revenue, and the company's spinoff from Abbott Labs (NYSE: ABT  ) only magnified the importance of Humira to its results. Yet AbbVie knows it has to move beyond its blockbuster drug to find potential replacements down the road. Let's take an early look at what's been happening with AbbVie over the past quarter and what we're likely to see in its quarterly report.

Stats on AbbVie

Analyst EPS Estimate	$0.79
Change From Year-Ago EPS	(1.3%)
Revenue Estimate	$4.54 billion
Change From Year-Ago Revenue	1%
Earnings Beats in Past 4 Quarters	1*

Source: Yahoo! Finance. *Out of one earnings release since spinoff.

Can AbbVie earnings perk up this quarter?
Analysts have generally gotten more optimistic in recent months about AbbVie earnings, keeping their short-term estimates for the June quarter unchanged but raising their full-year 2013 consensus by a penny per share. The stock's ascent has slowed in recent months, but it still posted a 5% gain since mid-April.

AbbVie's first-quarter results underscore the importance of Humira to the company's overall results. Sales of $2.2 billion for the drug represented half of AbbVie's overall revenue, and those figures continue to accelerate higher as a new indication for ulcerative colitis sent Humira revenue up 16% worldwide and up 23.7% in the U.S. market. Yet Humira's coming expiration dates of 2016 in the U.S. and 2018 in Europe make it clear that the company has to move forward with new initiatives.

One possibility comes from the company's direct-acting antiviral combination to treat hepatitis C, which earned favorable status as a breakthrough therapy from the FDA in May. The problem, though, is that the hep-C space is extremely competitive, with both Gilead Sciences (NASDAQ: GILD  ) and Johnson & Johnson (NYSE: JNJ  ) having submitted their own hep-C treatments for FDA priority review. Although J&J's simeprevir was first to get into the FDA's review process, it shares the same drawback as AbbVie's treatment in that it only treats one genotype of the hep-C virus. That puts Gilead's sofosbuvir in the driver's seat, as it treats hep-C viruses of different genotypes. The big question for AbbVie is whether breakthrough status will give it a leg up as it seeks to combine its own stable of drugs into a single therapy to avoid revenue sharing. But the recent approval of Abbott Labs' hep-C genotyping test could boost attention for the disease and paint AbbVie in a favorable light within the industry.

Still, AbbVie faces plenty of competitive pressure. Late last month, the company got bad news when the European Medicines Agency approved two rival autoimmune-disease medications that were biosimilars for J&J's Remicade. If the trend continues, the EMA could move on to approve other biosimilars that would hurt AbbVie more directly.

In the AbbVie earnings report, watch to see how the company discusses its strategy for its hep-C treatment, as well as the rest of its pipeline. With the importance of figuring out what it will look like after Humira, AbbVie has plenty of work to do to convince investors that the company will thrive beyond the next few years.

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Investing In The Global Diabetes Epidemic

There is a “silent epidemic” among us. It’s insidious and devastating. And it’s raging across both the US and the world. The epidemic is diabetes.

Diabetes has a terrible impact on the human body. According to doctors, it can lead to heart disease, cancer, stroke, kidney failure, foot amputations, and blindness. Preventing and mitigating the effects of this disease should be a top priority for everyone.

Below are three speculative plays on this terrible phenomenon. Although only suitable for aggressive investors, each stock could pay off with outsized returns.

At first the symptoms of diabetes are subtle; you can be at risk and not even know it. The American Diabetes Association says 8.3 percent of Americans have the disease and an additional 25 percent are prediabetic, meaning they run a good chance of developing the full-blown disease. Obesity is closely related to diabetes and the rates of both are rising rapidly.

Blood sugar is at the heart of diabetes. When you eat (or drink) carbohydrates—sweets, bread, potatoes, processed foods, etc.—blood sugar levels rise. Nothing particularly wrong there; it’s how your body gets energy.

Normally, after eating, insulin does a wonderful job at keeping blood sugar levels close to the “good” range. Diabetes occurs when the pancreas does not make or use insulin properly and blood sugar levels careen out of control, wreaking havoc on the body.

Prevention and Treatment

Prevention is the only real cure for Type 2 diabetes (95 percent of cases). Once the disease develops, you can’t cure it, only control it. Today’s type 2 diabetes epidemic is almost certainly caused by the rapid shift, across the world, into eating processed foods that are high in sugar and fat and low in fiber. The disease has a strong genetic component. American Indians, Hispanics, Asians, and Pacific Island! ers seem especially susceptible.

Unfortunately, government and other organizations do a poor job getting the “bad diet” message out. Generalized advice to “change your diet, increase your level of physical activity, and maintain a healthy weight is either not heard or simply ignored.

As a result, the epidemic rages on, while the number of afflicted and the costs of treating them escalate rapidly. This presents investors with opportunities. Below are three companies whose products and services help people with diabetes stem the effects of this intractable disease.

Novo Nordisk (NYSE: NVO) is a $90 billion Danish company that derives 73 percent of its revenue from diabetic products and services. The company is the world’s largest insulin maker and has several new drugs in the FDA pipeline. In February, the company’s price plummeted after the FDA demanded additional tests for its long-acting insulin analogue Tresiba.

The company is now betting nearly $3.7 billion in the oral diabetes market that it estimates to be nearly $18 billion by 2020.

Novo Nordisk’s stock has been trending up since the Tresiba disappointment. The company has strong revenue growth and is nearly debt free.

MannKind (NASDAQ: MNKD) has been much in the news the last few years. The excitement centers on its inhalable insulin drug Afreeza. The drug breezed through its phase III trials in mid-August, but FDA approval is still uncertain.

As most insulin is taken by (sometimes painful) injection, Afreeza could be a game changer. MannKind’s fortunes will rise or fall dramatically on the FDA’s decision.

MannKind is currently not profitable and book value is negative. Investors are pinning their hopes on Afreeza. The company’s share price, over $10 in March 2010, is now a little over $5.

Biodel (NASDAQ: BIOD) is a $50 million, relatively unknown micro-cap that’s attempting to position itself in the fast growing markets for ! rapid-act! ion insulin and glucagon.

Glucagon is a rescue drug that has the opposite effect of insulin, boosting blood sugar when levels drop too low. The company hopes to prosper with fast-growing demand for these two products. Biodel predicts the glucagon market will grow 6-8 fold over the next 8 years.

Biodel’s stock, down some 50 percent since late August, may now be in buying range. In September, Biodel’s CEO bought 10,000 shares at $3.34. Currently, the price is around $2.6. Insider buying usually indicates management has confidence in their company and now you can buy Biodel 22 percent below what the CEO paid. But then, CEOs have been known to be overly optimistic.

Sadly, the diabetes epidemic shows little sign of abating. Until (or if) it does, demand for diabetic products and services is almost guaranteed. Companies that can supply better products and services for this disease should do well.

Of the three companies above, Novo-Nordisk is the most conservative play. Its size and broad array of products and services make it the “safest” investment in this volatile sector. MannKind is strongly speculative. If Afrezza is approved by the FDA and lives up to its promise,  the stock could skyrocket. If not, it will likely plummet. Biodel is also speculative but its recent price decline, followed by insider buying is an encouraging sign.

All pharmaceutical companies live or die by FDA approval and the above three are no exception.

Bruce Vanderveen is a Florida-based investment analyst and writer.

Jury: BofA liable for Countrywide mortgage fraud

NEW YORK — Bank of America was found liable for fraud Wednesday for a program dubbed "the Hustle" that caused millions in losses to federally-backed mortgage finance firms Fannie Mae and Freddie Mac amid fallout from the financial crisis.

The civil verdict by a Manhattan federal court jury similarly found the bank's Countrywide Financial unit found liable, and also determined that former Countrywide executive Rebecca Mairone committed fraud while overseeing the loan-origination program.

Bank of America acquired Countrywide in July 2008.

The decision following a month-long trial focused on evidence that the Countrywide program processed mortgage applications at high speed with little checking for fraud, misrepresentations or other potential wrongdoing.

U.S. District Judge Jed Rakoff is expected to determine civil costs to be paid by the bank in the penalty phase of the case.

"Almost a year to the day after we brought suit, a unanimous jury has found Countrywide, Bank of America, and senior executive Rebecca Mairone liable for making disastrously bad loans and systematically removing quality checks in favor of its own balance," said Manhattan U.S. Attorney Preet Bharara in a statement after the verdict. "As demonstrated at trial, they adopted a program that they called 'the Hustle,' which treated quality control and underwriting as a joke."

Bank of America bought Countrywide "thinking it had gobbled up a cash cow," said Bharara, but profits from the program were "built on fraud."

Bank of America spokesman Lawrence Grayson said the Charlotte, N.C.-based financial giant, the second-largest U.S. bank, is studying the verdict.

"The jury's decision concerns a single Countrywide program that lasted several months and ended before Bank of America's acquisition of the company," said Grayson. "We will evaluate our options for appeal."

Defense attorney Marc Mukasey called Mairone "a model of honesty, integrity and ethics." Insisting there was no fraud, Mukasey ! said "we'll fight on."

Countrywide created the Hustle program, officially known as the HSSL, or High Speed Swim Lane, in 2007 as the real estate market started to collapse and the market for sub-prime mortgage loans dried up.

The aim was to move toward handling more prime mortgage loans, which generally are made to borrowers who have high credit ratings and can afford larger down payments.

But federal prosecutors charged that the program's design was to have loans "move forward, never backward," and to remove "toll gates" that could slow the loan approval process."

Employees assigned to the program received bonuses based on the volume of mortgages approved, a dramatic turnabout from previous metrics that focused more on loan quality, prosecutors charged.

An internal quality review in January 2008 found that 57% of Hustle loans defaulted, prosecutors charged in the lawsuit they filed last year. Thousands of loans approved under the program were ultimately sold to Fannie and Freddie.

While the case related to a small piece of the mortgage market, it could embolden other government investigations, said Kevin Whelan, national campaign director for the Home Defenders League, a national movement of homeowners underwater on their mortgages.

"The fact that they're winning in court could inspire the federal government to keep going with its own investigations into bank and executives," said Whelan. "It's not too late."

Contributing: Associated Press

Cree’s Mixed Results Darkened by Outlook

Cree Inc. (NASDAQ: CREE) reported first fiscal quarter 2014 results after markets closed on Tuesday. For the quarter, the LED-lighting maker posted adjusted diluted earnings per share (EPS) of $0.39 on revenues of $391 million. In the same period a year ago, the company reported EPS of $0.27 on revenues of $315.8 million. First-quarter results compare to the Thomson Reuters consensus estimates for EPS of $0.39 and $392.31 million in revenues.

The company warned on earnings in mid-August and today's results were right in line with the mid-points of the ranges the company gave for EPS and revenues. The damage today came from Cree's estimate of second quarter profit. The company says it expects EPS of $0.36 to $0.41 compared with a current consensus estimate of $0.44. The company expects revenues in the range of $410 to $420 million and the analysts' estimate calls for $414.29 million.

In addition to the weak profits, gross margins are expected to be lower in the second quarter and operating expenses are going to rise as the company promotes its new LED Bulb.

The company's CEO said:

Fiscal 2014 is off to a good start, as we delivered solid Q1 revenue and earnings growth in line with our targets. The strong performance was primarily due to increased sales of our lighting products, higher gross margins and improved operating leverage across the business. Based on our backlog, current sales activity and project forecasts, we are targeting growth in all product segments in Q2, led by growth in LED fixtures and the Cree LED Bulb.

Cree may be targeting growth, but that growth is coming at a cost that investors are unhappy paying. The company posted its 52-week high the day before announcing its earnings warning, and an upgrade from one analyst firm in early October pulled the shares up from around $60 to Monday's close at nearly $74. That momentum is history after tonight's earnings.

Cree's shares are trading down about 13.7% at $64.12 in after-hours trading Tuesday, in a 52-week range of $28.08 to $76.00. Thomson Reuters had a consensus analyst price target of around $67.50 before today's report.

Twitter Quitters Putting a Crimp on Social Network's IPO

Richard Drew/AP SAN FRANCISCO -- Retired schoolteacher Donald Hovasse signed up for Twitter about a year ago at the urging of his daughter. He lost interest after trying the service a few times and finding lots of celebrities but few of his friends using the online social network. "I didn't really get the point of it at all," said the Las Vegas resident. "Most of them were people I wasn't interested in hearing what they had to say anyway." He said, however, that he does check Facebook everyday to see what his friends are up to. Hovasse's experience highlights a risk for investors as Twitter marches towards this year's most anticipated initial public offering in the United States, expected to begin trading on the New York Stock Exchange in mid-November. According to a Reuters/Ipsos poll, 36 percent of 1,067 people who have joined Twitter say they don't use it, and 7 percent say they have shut their account. The online survey, conducted Oct. 11-18, has a credibility interval, a measure of its accuracy, of plus or minus 3.4 percentage points. In comparison, only 7 percent of 2,449 Facebook members report not using the online social network, and 5 percent say they have shut down their account. The results have a credibility interval of 2.3 percent. People who have given up on Twitter cite a variety of reasons, from lack of friends on the service to difficulty understanding how to use it. Twitter declined to comment for this story, saying it is in a quiet period ahead of its IPO. Twitter's attrition rate highlights a challenge that has dogged the online messaging site over the years: while it has managed to enlist many high-profile and avid users, from the pope to President Barack Obama, Twitter has yet to go truly mainstream in the way Facebook (FB) has. Convincing ordinary people to think of Twitter as an indispensable part of their lives is key to the company's ability to attract advertisers and generate a profit. Twitter reported it had 232 million "active" users -- people who access the service at least once a month -- at the end of September, up 6.1 percent from the end of June. Twitter's quarter-over-quarter growth in active users hasn't exceeded 11 percent since June 2012. When Facebook was a similar size, its active users were increasing by more than 20 percent every quarter, and it wasn't until the social network neared the half-a-billion member mark that its user growth decelerated to 12 percent. "Twitter is a great service, it's still got growth in front of it. But in my opinion, I would say the opportunities are less than that of Facebook, and it has to be valued appropriately," said Dan Niles, chief investment officer of tech-focused hedge fund firm AlphaOne Capital Partners. "The data would seem to imply that the ultimate revenue potential for this company is less than for Facebook," Niles said, referring to Twitter's number of active users. Twitter's revenue in the third quarter more than doubled from the year before to $168.6 million, while its net loss tripled to $64.6 million. Analysts expect Facebook, which is due to report its third-quarter results later this month, to bring in $1.9 billion in quarterly revenue. Quitters Twitter aims to become the "fabric of every communication in the world" and to eventually reach every person on the planet, Chief Executive Officer Dick Costolo has said. Still, Twitter acknowledged in its IPO prospectus that "new users may initially find our product confusing." The company prides itself on staying true to its roots: it lets people send 140-character messages and doesn't pack in scads of extraneous functions. Since its inception, Twitter has resisted overtly manipulating how people use its platform, instead preferring conventions to be formed organically. As a result, new users often find it initially difficult to grasp how discussions ebb and flow, complaining that features such as the "hashtags" that group Tweets by topic, abbreviations for basic functions (for instance, RT for retweet) and shortened Web links, are geared towards a technologically savvy crowd. "The average person that's coming on here, they're still baffled by it," said Larry Cornett, a former executive at Yahoo (YHOO) and designer at Apple (AAPL), who now runs product strategy and design consulting firm Brilliant Forge. "If they want the mass adoption and that daily engagement, they have to make it really easy for people to consume." According to the Reuters/Ipsos poll, 38 percent of 2,217 people who don't use Twitter said they didn't find it that interesting or useful. Thirteen percent said they don't understand what to use Twitter for. The results have a credibility interval of 2.4 percent. Twitter has taken steps to help new members. In December 2011, it introduced a new "Discover" section to highlight the most popular discussion topics based on a person's location and interests. The company also simplified some features and rolled out new tools that embed photos and videos directly in a person's tweet stream, making for a richer and easier-to-use experience. These changes may mean that Twitter's retention rate for the past several months is better than its overall retention rate, which includes people who joined years ago, say analysts. Brian Wieser, an analyst with Pivotal Research Group, said Twitter's current user base is already big enough to be valuable to advertisers. Investors need to get more comfortable with the idea that Twitter isn't for everyone, he said. "The practical matter is that this is a niche medium," he said. "Their appeal, they will never be as broad as Facebook."

Stratasys to Merge With MakerBot in $400 Million Deal

In the latest move to consolidate the additive manufacturing industry, Stratasys (NASDAQ: SSYS  ) announced Wednesday that privately held MakerBot has agreed to merge with one of its subsidiaries in a stock-for-stock transaction.

The terms
The deal, which effectively launches Stratasys firmly into the affordable 3-D printer market, stipulates Stratasys will initially issue around 4.76 million shares in exchange for 100% of the outstanding capital stock of MakerBot. Based on Stratasys' closing price of $84.60 per share Wednesday, that puts MakerBot's value at $403 million.

In addition, MakerBot stakeholders may also qualify for "performance-based earn-outs that provide for the issue of up to an additional 2.38 million shares through the end of 2014." If earned, the payments will be made at Stratasys' discretion in a combination of new shares or cash.

If this sounds familiar...
I suppose the news shouldn't come as a complete shock; back in February, I emphatically stated someone needed to buy MakerBot before the company's incredible growth made it impossible to do so.

Alas, while this does blast my recent prediction of an Amazon.com buyout to bits, I can at least take some solace that Amazon has since launched a dedicated 3-D printing section on its website to bolster the growing market.

Then again, I did originally suggest both 3D Systems (NYSE: DDD  ) and Stratasys could be potential suitors, but noted at the time that an acquisition by the former might be unlikely considering MakerBot was already competing directly with 3D Systems own consumer-oriented Cube printers. And while 3D Systems has so far remained mum regarding specific sales numbers for the Cube, it certainly can't hurt that the devices are set to be sold through Staples both online and at its brick and mortar locations by the end of this month.

What's more, while I believed Stratasys' industrial-centric operations could benefit by adding MakerBot to the mix, I remained skeptical because I wondered whether Stratasys already had its hands full completing the integration of its massive 2012 merger with fellow industry leader Objet.

Problem solved
Fortunately, it seems the folks at Stratasys already had that one figured out, as Wednesday's press release states: "Stratasys intends for MakerBot to operate as a separate subsidiary, preserving its existing brand, management, as well as the spirit of collaboration it has built with its users and partners."

To be sure, that's a great thing when we remember MakerBot boasts an incredibly loyal following, having sold 22,000 3-D printers since its founding in 2009. Most impressive, however, is that number includes 11,000 of its affordable new Replicator 2 desktop models sold over the past nine months alone.

In addition, as fellow Fool Blake Bos pointed out recently, MakerBot has also done a fantastic job growing its enviable model library at Thingiverse.com into the single largest collection of downloadable digital designs for printing physical... uh... things. 

Foolish final thoughts
In the end, my hat's off to Stratasys for wrangling the deal, and I'm sure I'm not the only one who can't wait to see where the combined companies go from here. In the meantime, here's a peek at Stratasys' newest toy:

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

Do You Trust the Earnings at Endologix?

Although business headlines still tout earnings numbers, many investors have moved past net earnings as a measure of a company's economic output. That's because earnings are very often less trustworthy than cash flow, since earnings are more open to manipulation based on dubious judgment calls.

Earnings' unreliability is one of the reasons Foolish investors often flip straight past the income statement to check the cash flow statement. In general, by taking a close look at the cash moving in and out of the business, you can better understand whether the last batch of earnings brought money into the company, or merely disguised a cash gusher with a pretty headline.

Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on Endologix (Nasdaq: ELGX  ) , whose recent revenue and earnings are plotted below.

Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. FCF = free cash flow. FY = fiscal year. TTM = trailing 12 months.

Over the past 12 months, Endologix burned $19.2 million cash while it booked a net loss of $28.4 million. That means it burned through all its revenue and more. That doesn't sound so great.

All cash is not equal
Unfortunately, the cash flow statement isn't immune from nonsense, either. That's why it pays to take a close look at the components of cash flow from operations, to make sure that the cash flows are of high quality. What does that mean? To me, it means they need to be real and replicable in the upcoming quarters, rather than being offset by continual cash outflows that don't appear on the income statement (such as major capital expenditures).

For instance, cash flow based on cash net income and adjustments for non-cash income-statement expenses (like depreciation) is generally favorable. An increase in cash flow based on stiffing your suppliers (by increasing accounts payable for the short term) or shortchanging Uncle Sam on taxes will come back to bite investors later. The same goes for decreasing accounts receivable; this is good to see, but it's ordinary in recessionary times, and you can only increase collections so much. Finally, adding stock-based compensation expense back to cash flows is questionable when a company hands out a lot of equity to employees and uses cash in later periods to buy back those shares.

So how does the cash flow at Endologix look? Take a peek at the chart below, which flags questionable cash flow sources with a red bar.

Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. TTM = trailing 12 months.

When I say "questionable cash flow sources," I mean items such as changes in taxes payable, tax benefits from stock options, and asset sales, among others. That's not to say that companies booking these as sources of cash flow are weak, or are engaging in any sort of wrongdoing, or that everything that comes up questionable in my graph is automatically bad news. But whenever a company is getting more than, say, 10% of its cash from operations from these dubious sources, investors ought to make sure to refer to the filings and dig in.

With 90.7% of operating cash flow coming from questionable sources, Endologix investors should take a closer look at the underlying numbers. Within the questionable cash flow figure plotted in the TTM period above, stock-based compensation and related tax benefits provided the biggest boost. Overall, the biggest drag on FCF came from changes in accounts receivable, which represented 57.3% of cash from operations. Endologix investors may also want to keep an eye on accounts receivable, because the TTM change is 2.4 times greater than the average swing over the past 5 fiscal years.

A Foolish final thought
Most investors don't keep tabs on their companies' cash flow. I think that's a mistake. If you take the time to read past the headlines and crack a filing now and then, you're in a much better position to spot potential trouble early. Better yet, you'll improve your odds of finding the underappreciated home-run stocks that provide the market's best returns.

Looking for alternatives to Endologix? It takes more than great companies to build a fortune for the future. Learn the basic financial habits of millionaires next door and get focused stock ideas in our free report, "3 Stocks That Will Help You Retire Rich." Click here for instant access to this free report.

We can help you keep tabs on your companies with My Watchlist, our free, personalized stock tracking service.

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The Most Ridiculous Thing You'll Read All Year

Michelle Obama is the spokeswoman of a national health campaign called "Let's Move."

The program is designed to encourage children to engage in healthy activities, to eat better foods, to drink plenty of water, and to encourage everyone to get outside and exercise.

It's a noble message (run by federal dollars) in a world of video games and excessive saturated fat.

But, like all government programs, intentions end up trumping fiscal sanity.

Don't let Washington destroy your portfolio along with the U.S. dollar. Get your four-part plan here.

You see, to promote the cause, the U.S. Postal Service created a series of 15 commemorative stamps to celebrate children having fun and getting active.

Here are what three of the stamps look like:

Now, here's the ridiculous part.

The printer is going to destroy every set they printed.

According to Linn's Stamp News, the President's Council on Fitness, Sports & Nutrition complained that the three stamps above promote "unsafe activities" for children. The actions these two-dimensional images represent have been deemed "unsafe" because the caricatures jumping in a pool, doing a hand stand, and riding a skateboard aren't wearing "proper safety equipment."

The USPS will destroy these stamps because the skateboarder isn't wearing kneepads, the kid doing the handstand isn't wearing a helmet, and the pool-jumper is doing a cannonball - too dangerous even in cartoon form.

The entire purpose of these stamps was to make being active look fun. But this is how crazy the logic of some people in Washington has become.

How have any of us made it this far in life, without the government constantly looking over our shoulder and evaluating the danger of our activities?

It's just a matter of time before they ban Bugs Bunny cartoons, because, according to those story lines, you can stop bullets in Elmer Fudd's gun by sticking two fingers into the barrel...

Keep in mind that the USPS has lost billions of dollars and, after 15 years, still hasn't been able to adapt to competition from email providers.

This begs another basic question: Is destroying these stamps a responsible economic decision as well?

Of course not.

3 Stocks Rising on Unusual Volume

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

>>5 Stocks Ready to Break Out

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

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

>>5 Hated Earnings Stocks You Should Love

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

Fairway Group

Fairway Group (FWM) sells fresh, natural and organic products, prepared foods and hard to find specialty and gourmet offerings. This stock closed up 10.6% at $24.47 in Monday's trading session.

Monday's Volume: 388,000

Three-Month Average Volume: 146,163

Volume % Change: 190%

>>5 Big Stocks to Trade for Big Gains

From a technical perspective, FWM soared sharply higher here right off some near-term support at $22.03 and back above its 50-day at $24.02 with strong upside volume. This move is quickly pushing shares of FWM within range of triggering a big breakout trade. That trade will hit if FWM manages to take out Monday's high of $25.67 to $25.93 and then once it clears more key overhead resistance levels at $27.31 to its all-time high at $28.87 with high volume.

Traders should now look for long-biased trades in FWM as long as it's trending above support at $22.03 and then once it sustains a move or close above those breakout levels with volume that's near or above 146,163 shares. If that breakout hits soon, then FWM will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that move are $33 to $35.

Buckeye Partners

Buckeye Partners (BPL) owns and operates refined petroleum products pipeline systems. This stock closed up 0.76% at $66.43 in Monday's trading session.

Monday's Volume: 1.67 million

Three-Month Average Volume: 407,520

Volume % Change: 189%

>>5 Stocks Under $10 Set to Soar

From a technical perspective, BPL trended modestly higher here with strong upside volume. This move is quickly pushing shares of BPL within range of triggering a near-term breakout trade. That trade will hit if BPL manages to take out some near-term overhead resistance at $66.96 to its 50-day moving average at $67.19 with high volume.

Traders should now look for long-biased trades in BPL as long as it's trending above Monday's low of $65.02 and then once it sustains a move or close above those breakout levels with volume that's near or above 407,520 shares. If that breakout hits soon, then BPL will set up to re-fill some of its previous gap down zone from September that started just above $70. If that gap gets filled with volume, then shares of BPL will set up to re-test its 52-week high at $73.44.

Penn National Gaming

Penn National Gaming (PENN) is a diversified, multi-jurisdictional owner and manager of gaming and pari-mutuel properties. This stock closed up 0.95% at $56.05 in Monday's trading session.

Monday's Volume: 1.77 million

Three-Month Average Volume: 858,142

Volume % Change: 170%

>>5 Stocks Hedge Funds Love This Fall

From a technical perspective, PENN spiked higher here right above some near-term support at $54.97 with strong upside volume. This stock has been uptrending strong for the last two months, with shares moving higher from its low of $48.70 to its recent high of $57.44. During that move, shares of PENN have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of PENN within range of triggering a near-term breakout trade. That trade will hit if PENN manages to take out some near-term overhead resistance levels at $56.67 to $57.44 with high volume.

Traders should now look for long-biased trades in PENN as long as it's trending above its 50-day at $54.40 or above its 200-day at $53.53, and then once it sustains a move or close above those breakout levels with volume that's near or above 858,142 shares. If that breakout hits soon, then PENN will set up to re-test or possibly take out its 52-week high at $59.93.

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

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

>>Why I'm Sticking By Dow 55,000

>>4 Stocks Under $10 Making Big Moves

>>SolarCity Set to Soar Even Higher

Follow Stockpickr on Twitter and become a fan on Facebook.

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

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

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

5 SEC Exam Red Flags: Tom Giachetti

Compliance consigliere Tom Giachetti continued his war last week on consultants selling prepackaged forms and services.

“Compliance is what?” he rhetorically asked, before continuing in typical Giachetti style. “Not forms; Not consultants; it’s BS.”

The chairman of the securities practice group at the law firm Stark & Stark and ThinkAdvisor contributor argued that advisors wouldn’t even do half of the compliance work if the “SEC wasn’t coming after you. Why? Because it takes you away from time spent with clients. You have to justify your existence and prove that you are not a criminal. So it becomes all about getting through an examination.”

Speaking to a morning crowd at a compliance workshop sponsored by Laserfiche and TD Ameritrade that also featured Greg Freidman of software maker Junxure, Giachetti warned the assembled advisors of five red flags the SEC is looking for in exams.

1). Assets Under Management — There is no such thing as “assets under advisement,” he said, so don’t use the term. It’s all about discretionary versus nondiscretionary control that advisors have over their clients’ accounts.

“If you can’t trade it, you can’t count it,” he argued. “The SEC is bringing enforcement actions against firms for grossly exaggerating their AUM to make them seem larger than they are.

“If you say you manage something, you’d better manage it,” he continued. “If the SEC asks how you earn a fee you can’t say, “because my consultant told me so.”

2). Custody — If you serve as a trustee for the client in any capacity, then you custody for them, with all the attendant responsibly that brings. If you pay a client’s taxes, college bills for their children or anything like that, you are a financial intermediary. It is better to have standard letters of authorization. Send them once a year, have the client sign them and then send them back. It’s “a very simple process,” Giachetti says.

3). Performance — “Are you bragging to clients about you performance? If so it will put you on the highest echelon of scrutiny when it comes to SEC enforcement actions. If for any reason your marketing people say, ‘I need numbers,’ you’ve got the wrong marketing people.”

Forget publishing performance net-of-fees versus gross-of-fees, “you have to quote the performance with the highest fee you would have charged on your schedule,” he said.

Finally, if advisors use model portfolios, be aware of dispersion analysis.

“If your model is up 150 basis points for the quarter, you better be able to prove all of your clients in that model are up 150 basis points as well, or you have a dispersion problem.”

4). Due Diligence — If the advisor uses separately managed accounts, private investment funds and similar products, be prepared to answer two questions on the exam.

“The first is how you found the products; the second is how you monitor them,” he said. “If you use them off of a custodian’s platform, it makes it easier because you can see the money move due to transparency. However, the question then becomes, ‘What does the custodian do to vet them?”

5). Client Confidentiality — What are you doing to ensure the confidentiality of the client is protected? According to Giachetti, an agreement should be signed with your building management, building staff and unrelated third parties who are sharing office space.

“Anyone with ingress and egress to your office, building janitors, for instance, should have a confidentiality agreement with you. It won’t stop someone from stealing, but at least then you are covered.”

Third-party IT vendors are especially problematic, he warned, because they know everything about the advisors business.

“You should use a vendor checklist to demonstrate how you found the vendor and why you use them.”

He concluded with a topic receiving attention of late, wire fraud, where a criminal attempts to have the advisor wire funds to an account by impersonating the client.

“You train your staff in excellent service. Well, sometimes there is a reason not to give service.  Add a paragraph to the client agreement that you will not transact any wire transfer without verbal verification. This is important; I just had saw case of fraud that totaled $389,000.”

---

Check out these related stories on ThinkAdvisor:

5 Reasons Why You're In Debt Up To Your Eyeballs

Alamy We've all seen the LendingTree commercials where the guy sarcastically says: "I'm in debt up to my eyeballs. I can barely pay my finance charges. Somebody help me!" If that sounds like you, read on. Here are a few reasons why you're swimming in debt and what you can do about it. No spending plan. Without a plan or financial goals, you're headed down the road to digging yourself deeper into debt. A spending plan establishes goals and principles. If your goal is to save $20,000 for an emergency fund, then you need to avoid more debt along the way. Since debt must be paid back, it would take away from funding the $20,000 goal. Keeping up with everyone else. Your neighbor just pulled into his driveway with a new Ford Mustang, and you immediately think about buying the new Infiniti luxury sedan. That's what we know as keeping up with the Joneses. But it doesn't stop there. Your sister tells you she just picked up the latest purse in the Louis Vuitton spring line, and you think about that Chloe bag you didn't really want until now. We do this to ourselves because we don't want to feel we're missing out on the finer things in life. But what we miss is the reality of the Jones' financial situation. If they're living on credit, you'd never know because you're so blinded by their bling. Take a step back and assess the real reasons behind your newest impulsive purchase, and then take action. Lack of discipline. Just as you begin to think about purchasing a new car because your neighbor recently bought one, hopefully you have enough restraint to consider the impact on your spending plan. If your goal is to get out and stay out of debt, then discipline will play a major role in your daily financial life. Financial discipline will help you assess your goals and consequences when faced with a decision that could potentially take you off the plan. Discipline is your friend. Embrace it. Buying a new car every few years. Remember the car your neighbor bought? Well, let's just say you're about six months from paying off your current vehicle, but you've now convinced yourself that it's time to get a new car because "I deserve it." This is a classic reason why so many people dig in and remain in debt. Most people relish the idea of not having a car payment, and others relish the new car smell and feel every few years. You must decide what's more important to you -- living a debt-free life or cruising in the latest model. In your world, credit is king. You enjoy a little retail therapy because you've had a hard week.But your bank accounts are overdrawn. Not to worry, you've got good ole MasterCard coming to your rescue. The problem? Your cards are mastering you and not the other way around. You've become so addicted to the plastic that you hardly recognize your spending plan anymore. As with the guy from the LendingTree commercials, your life is largely financed by your debt. But it's driving you crazy and will cause many sleepless nights ahead. Here's the thing about getting out of debt: It requires a strong but realistic spending plan that you can stick with through the end. This is a "living" plan that will change along the way, but that's the beauty of it all. Forget keeping up with everyone else, and cut up your credit cards. Spending your time trying to impress people who don't factor into your bottom line is a waste of money and will impede your financial goals. Assess your financial goals, and decide if having a new car is truly worth the money spent. Remember, it's no fun being stressed because your finances are out of control. Take control now, and enjoy the fruits of your efforts along the way.

Good News Powers Advanced Micro Devices (AMD) Ahead of Earnings

Advanced Micro Devices, Inc (NYSE: AMD) is scheduled to report earnings late next week and over the past week or so, there has been a steady stream of good news about the stock. I should mention that we have Advanced Micro Devices in our SmallCap Network Elite Opportunity (SCN EO) portfolio and its been an up and down ride for us as the last earnings report, which actually wasn't all that bad, erased our gains but shares have largely recovered since then. With that in mind, here's the latest good news from the past week or so:

Verizon Picks AMD's SeaMicro Servers to Create New Cloud. On Monday, Advanced Micro Devices announced that Verizon Communications Inc (NYSE: VZ) is deploying SeaMicro SM15000™ servers for its new global cloud platform and cloud-based object storage service. According to the press release, Verizon and AMD co-developed additional hardware and software technology on the SM15000 server to provide unprecedented performance and reliability that is backed by enterprise-level service level agreements (SLAs). The Wall Street Journal's Digits blog has noted that Advanced Micro Devices had puzzled some people when it bought the startup SeaMicro as no-one knew at the time that Verizon is exclusively using SeaMicro server and storage hardware for its cloud computing service. However, AMD isn't disclosing just how many pieces of hardware are involved, nor how much it will be paid but this is the biggest deal ever for SeaMicro. FBR Capital Markets Raises Its Price Target. On Monday, FBR Capital Markets upped their price target on Advanced Micro Devices from $5.50 to $6.00. In light of Verizon announcing two enterprise infrastructure-as-a-service offerings, FBR Capital Markets' analysts wrote:  

"Details surrounding the announcement lead us to believe that Verizon has chosen SeaMicro microservers to power these platforms and may provide AMD as much as ~$50M in incremental annual revenues. While we reported after our BIG 'switches': little SERVERS conference that Verizon had deployed SeaMicro in 12 global datacenters, this announcement signifies a more meaningful commitment, well beyond a trial deployment."

They also added:

"In addition to SeaMicro, AMD's results should be buoyed by the better-than-expected PC market exhibiting resiliency, as our ODM notebook tracker indicates units up 7% sequentially. Furthermore, China has relaxed its national gaming console ban, causing us to increase our 2015 Xbox One and PS4 estimates. Additionally, AMD may have a chance at providing parts for both the MS 'Bestpad' and Sony 'Vita TV.'"

AMD's Mantle Matters. Advanced Micro Devices recently launched Mantle as a brand new API (Application Programming Interface) designed to significantly aid game developers in crafting games targeted for release on multiple platforms and Jason Evangelho has written a piece for the Forbes Contributor Network about its importance. He noted:

"AMD's Mantle is a While its prevalence is yet to be determined, its importance is clear. Mantle is a rally cry from AMD to developers, and a crucial consideration for PC gamers choosing their next graphics card."

Origin PC Publicly Dumps the AMD Graphics Options. In what might be considered not so good news, the CEO of the boutique PC builder Origin PC has informed some in the media that his company will no longer sell machines with AMD graphics cards inside based on "a combination of many factors including customer experiences, GPU performance/drivers/stability, and requests from our support staff." However,  Brad Chacos has written a blog post (since updated with further updates) to question PCWorld's motives and to ask whether Nvidia has "purchased" Origin's fealty with marketing dollars. Both Nvidia and Origin have issued denials. Upcoming Earnings Report. Advanced Micro Devices is scheduled to report third quarter earnings on Thursday, October 17, after the market closes with the conference call scheduled for 5:30 p.m. EDT / 2:30 p.m. PDT – meaning big investors and traders alike will be jockeying their positions from now until late next week. Moreover, it should be remembered that the stock dropped after the last earnings report which coincided with some other tech earnings reports that were disappointing. Share Performance. On Tuesday, Advanced Micro Devices fell 3.63% to $3.72 (AMD has a 52 week trading range of $1.81 to $4.65 a share) for a market cap of $2.68 billion plus the stock is up 63.2% since the start of the year, up 15.5% over the past year and down 17.9% over the past five years:

Finally, here is the latest technical chart for Advanced Micro Devices:

In other words, there is plenty of good news for investors and traders alike in Advanced Micro Devices as the company heads into earnings next week.  

SmallCap Network Elite Opportunity (SCN EO) has an open position in AMD. To find out what other open positions SCN EO currently has, and to learn why so many traders and investors are relying on this premium subscription service, click here to find out more.

Corinthian Colleges Plunges 4% as California AG Files Suit

Corinthian Colleges (COCO) is tumbling today after California’s attorney general filed suit against the for-profit college for “false and predatory advertising,” among other charges.

From the AG Kamala Harris’s press release:

The complaint alleges that CCI intentionally targeted low-income, vulnerable Californians through deceptive and false advertisements and aggressive marketing campaigns that misrepresented job placement rates and school programs. CCI deployed these advertisements through persistent internet, telemarketing and television ad campaigns. The complaint further alleges that Corinthian executives knowingly misrepresented job placement rates to investors and accrediting agencies, which harmed students, investors and taxpayers.

The AP notes that the charges are similar to those that were filed by now-governor Jerry Brown in 2007 and were settled for $6.5 million.

Corinthian responded in an SEC filing:

On October 10, 2013, Corinthian Colleges, Inc. (the "Company," "Corinthian," "we," "us" or other similar terms) was notified of a civil complaint filed against the Company and several of its subsidiaries by the California Attorney General's Office (the "CA AG"). As previously disclosed, we have been cooperating with an investigation initiated by the CA AG in December 2012, more than nine months ago. The Company was disappointed that it was not given advance notice of the complaint, and did not have the opportunity to discuss the allegations in the complaint with the CA AG before the complaint was filed.

The Company is committed to regulatory compliance and has robust processes in place to correctly record and disclose the job placement information we receive from our graduates and their employers. The Company is proud of the career and technical education that our 15,000 employees provide to more than 80,000 students in the United States and Canada. The Company expects to vigorously defend against this complaint.

Shres of Corinthian have dropped 4.2% to $1.96 but don’t seem to be hitting other for profit universities. ITT Educational Services (ESI) has gained 2.2% to $31, Apollo Group (APOL) has risen 0.7% to $20.44 and Devry (DV) is up 0.9% at $31.95.

eLong Beats on Both Top and Bottom Lines

eLong (Nasdaq: LONG  ) reported earnings on May 13. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), eLong beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly. Non-GAAP earnings per share grew. GAAP earnings per share dropped significantly.

Gross margins grew, operating margins dropped, net margins dropped.

Revenue details
eLong notched revenue of $37.2 million. The two analysts polled by S&P Capital IQ expected to see revenue of $33.3 million on the same basis. GAAP reported sales were 44% higher than the prior-year quarter's $24.3 million.

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

EPS details
EPS came in at $0.07. The two earnings estimates compiled by S&P Capital IQ predicted $0.01 per share. Non-GAAP EPS of $0.07 for Q1 were 17% higher than the prior-year quarter's $0.06 per share. GAAP EPS of $0.01 for Q1 were 80% lower than the prior-year quarter's $0.05 per share.

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

Margin details
For the quarter, gross margin was 58.0%, 270 basis points better than the prior-year quarter. Operating margin was -4.2%, 590 basis points worse than the prior-year quarter. Net margin was 1.3%, 650 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $39.5 million. On the bottom line, the average EPS estimate is $0.06.

Next year's average estimate for revenue is $163.3 million. The average EPS estimate is $0.34.

Investor sentiment
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 147 members out of 179 rating the stock outperform, and 32 members rating it underperform. Among 44 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 35 give eLong a green thumbs-up, and nine give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on eLong is buy, with an average price target of $20.67.

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Boeing Drops 2%: Will Earnings Disappoint?

Boeing (BA) sits just 5.1% off its 52-week high. It’s releasing earnings this month Put the two together, and you have a recipe for weakness. Boeing has dropped 1.7% to $113.45 at 11:22 a.m., making it the biggest loser in the Dow Jones Industrial Average.

Bloomberg News

RBC Capital Markets’ Robert Stallard thinks the earnings report could help push Boeing’s shares higher. He writes:

After a strong share price run this year, we think the challenge for Airbus and Boeing is to maintain this momentum. The 3Q results could help, though any upside is likely to come from internal efforts on cash and margins, versus revenues. The strength in large jets is likely to remain in stark contrast with business jets, where we are expecting another weak quarter for demand in small cabin, with a steadier performance in the mid and large cabin segment. The NBAA show during the earnings season could see some interesting new product launches, which have historically helped stimulate demand.

As for Boeing specifically, Stallard explains why the quarter should look good:

We expect another good result from BCA after it delivered 170 aircraft in the quarter, one more than in 2Q13. We could see performance at BCA, not withstanding potential margin dilution from 787 deliveries, partially offset by DoD budget related declines in its defense business. However, the impact of the sequester is likely to remain muted until next year, and the impact will likely be more significantly felt in the defense order book. The focus has increasingly shifted to cash generation and deployment, so progress on that front would be welcome. We could see Boeing firming up or increasing its commitment to returning cash to shareholders via the buy back. Our "core" EPS estimate for 3Q13 has been increased from $1.48 to $1.55 on higher BCA deliveries.

Of course, the government shutdown and debt-ceiling showdown have impacted Boeing’s stock, as well as other defense contractors. Stallard explains how who could be affected:

With the debt ceiling looming next week, we could see investor nerves rattling as the deadline approaches – and some of this appears to have shaken sentiment in defense. This is likely to contrast with 3Q earnings, which we expect to be as resilient as those seen in the first two quarters of the year for late cycle contractors. By contrast, services are likely to have again been weak, and we are not getting our hopes up over bookings and any preliminary thoughts on 2014, especially for shorter cycle, less visible areas.

Stallard sees KEYW Holding (KEYW) and Textron (TXT) potentially missing earnings, while Honeywell (HON),  Alliant Techsystems (ATK), Lockheed Martin (LMT), Raytheon (RTN) and Wesco Aircraft (WAIR) could beat.

Stocks lower amid shutdown speculation

Stocks fell Friday as a federal government shutdown loomed.

The Dow Jones industrial average was down 0.5%, the Standard & Poor's 500 index off 0.4% and Nasdaq composite was 0.1% lower in afternoon trading.

On Thursday, the Dow advanced 0.4% to 15,328.30 while the S&P 500 index rose 0.4% to close at 1,698.67. The Nasdaq climbed 0.7% to 3,787.43.

CONSUMER SPENDING: Rises 0.3%

THURSDAY: Stocks snap 5-day losing streak

SHUTDOWN: Economy would feel it

"People are cautious as we enter the last quarter and no point in taking a position with so many macro issues overhanging the market" such as a battle over the U.S. debt limit looming in October, said Andrew Sullivan, director of Asian sales trading at Kim Eng Securities.

Benchmark oil for November delivery fell 57 cents to $103.60 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 37 cents to settle at $103.03 on Thursday.

Asian stocks drifted on Friday.

Japan's Nikkei 225 dipped 0.4% to 14,765.29 after the country's consumer price inflation rose at the fastest rate in five years.

Regional bourses in Europe declined.

Later Friday, the U.S. Commerce Department will release data on personal income and spending for August.

Contributing: Associated Press

UAE Business Activity Rises, but Fear Lurks

Despite the fact that business activity in the UAE recently reached its highest level in two years, HSBC, one of the largest global financial institutions, is still issuing a warning about inflation, writes Tom Arnold, of The National.

Private-sector business activity in the UAE reached its highest level in more than two years last month, HSBC says.

But the bank warns that inflation is likely to become a growing concern next year, following the release of its latest purchasing managers' index (PMI), a monthly gauge of the performance of the non-oil private sector.

"It's extremely strong reading that shows the UAE economy is continuing to build speed," said Simon Williams, HSBC's chief economist for the Middle East and North Africa.

"The pickup in job creation is consistent with the positive overall trend, but the rise in wages may mean that price pressures are starting to build. Given rising rents, we fear inflation will be a matter of growing policy concern over 2014."

The performance of most companies has rebounded strongly since the global financial crisis of 2009, as the economy has grown. That's despite the impact of the current eurozone crisis and recent wobbles in other emerging markets.

But inflation has remained largely in check. Consumer prices edged up 1.3% in August, from the same period last year, according to the National Bureau of Statistics. Still, Dubai's property prices, which have risen by as much as 42% in the past year, have ignited fears about the increasing cost of living.

The seasonally adjusted headline PMI reached a 29-month peak of 56.6 points last month, according to the data. The strong reading is mirrored in Saudi Arabia, a separate survey shows. The kingdom's headline PMI rose to a six-month high of 58.7. A reading above 50 signals a rise in output.

Even so, the kingdom's headline PMI score is lower than a year ago. In the second quarter of this year, Saudi Arabia's GDP grew 2.7% after slumping to its trough—since at least 2010—in the first quarter as oil output fell.

Khatija Haque, a senior economist at Emirates NBD, wrote in a report that, in contrast to Saudi Arabia, "the PMI reading in the UAE has consistently been higher than a year ago, suggesting that the pace of real GDP growth has likely accelerated in 2013."

Last month, Sultan Al Mansouri, the Economy Minister of the UAE, said the country's GDP would expand by 4.5% this year, the fastest pace since 2008.

The UAE's latest PMI growth was underpinned by the fastest increase in new orders in the survey's 50-month history, bolstered by better market conditions, stronger sales, and new products. New business from abroad also rose sharply during the month, driven in part by increased tourism.

Bigger workloads led companies to step up hiring, lifting employment to the highest level in three months.

But the data also signals rising inflationary pressures for businesses. The rate of cost inflation—the amount that companies pay for stock and other goods and services—climbed to the highest level in seven months.

Although companies have not been passing on the higher cost of goods to customers for many months, because of a backlog of stock and spare capacity in the economy, this trend is weakening. That's as purchase prices rose again last month, albeit at a similar pace to the rise in August.

Staff costs also nudged higher, increasing by their fastest clip since June 2011. Survey respondents cited rising living costs and performance-based pay increases for the salary increases.

Read more from The National here…

10 Best Clean Energy Stocks To Buy For 2014

U.S. - the world�� largest consumer of energy- faced an unlikely situation quite recently. It was in April last year that the natural gas prices hit an all time low at under $2 per million British thermal credits. Many believed this to be an immutable and uncomfortable reality. Though this was only a partial reality, Shares of natural gas engine designer- Westport Innovation (WPRT) nearly doubled in four months as did clean energy fuels (CLNE), a company that builds refueling stations. The NAT GAS Act, passed by the congress, was aimed at promoting the usage of cleaner fuels. It provided subsidies to vehicles which used alternative fuels rather than going the conventional way.

The Obama administration laid stress on the fact that it would always be beneficial to use the clean fuels produced within the nation�� boundaries. To further the initiative he announced an investment of $1 billion in the gas infrastructure. All this was way back in April 2012. Now, coming to the present scenario, the gas pieces have doubled than what they originally were which now puts them at $4/mmBtu price tag. The congress is nowhere in the scene now amending bills that would encourage the use of natural gas vehicles. This had ramifications in the stock market as the stocks, as those of Westport and Clean Energy, that were peaking have now fallen down to almost half their value.

10 Best Clean Energy Stocks To Buy For 2014: Powell Industries Inc.(POWL)

Powell Industries, Inc. engages in the design, development, manufacture, and servicing of custom engineered-to-order equipment and systems for the management and control of electrical energy and other critical processes in transportation, environmental, energy, industrial, and utility industries. The company operates in two segments, Electrical Power Products and Process Control Systems. The Electrical Power Products segment offers electrical power distribution and control systems that are used to distribute, monitor, and control the flow of electrical energy, as well as to provide protection to motors, transformers, and other electrically-powered equipment. It offers power control room substation packages, traditional and arc-resistant distribution switchgear, medium-voltage circuit breakers, offshore generator and control modules, monitoring and control communications systems, motor control centers, and bus duct systems directly to end-users or to engineering, procuremen t, and construction firms. This segment serves oil and gas producers, oil and gas pipelines, refineries, petrochemical plants, electrical power generators, public and private utilities, co-generation facilities, mining/metals operations, pulp and paper plants, transportation authorities, governmental agencies, and other industrial customers. The Process Control Systems provides technology solutions, including instrumentation, computer controls, and communications and data management systems to control and manage critical processes and facilities; and technical services to deliver these systems. This segment sells its products and services directly to end-users in transportation, environmental, and energy sectors. The company has operations in Europe, the Far East, the Middle East, Africa, North America, South America, and Central America. Powell Industries, Inc. was founded in 1947 and is headquartered in Houston, Texas.

10 Best Clean Energy Stocks To Buy For 2014: ALLIED NEVADA GOLD CORP. (ANV.TO)

Allied Nevada Gold Corp., together with its subsidiaries, engages in the evaluation, acquisition, exploration, and advancement of gold exploration and development projects. It principally operates the Hycroft Mine, an open pit heap leach gold and silver mine covering approximately 61,389 acres of mineral rights located in the west of Winnemucca, Nevada. The company is also involved in the exploration and development of various exploration properties, including Hasbrouck, Mountain View, Three Hills, Wildcat, Maverick Springs, and Pony Creek/Elliot Dome projects. In addition, the company holds exploration rights to approximately 100 other exploration properties in Nevada. Allied Nevada Gold Corp. was incorporated in 2006 and is headquartered in Reno, Nevada.

Top 10 Gold Companies To Watch For 2014: Pervasive Software Inc.(PVSW)

Pervasive Software, Inc. provides embeddable software and SaaS services for data management, data integration, B2B exchange, and analytics. Its embeddable Pervasive PSQL database engine provides database reliability in a near-zero database administration environment for packaged business applications. Pervasive Software?s multi-purpose data integration platform, available on-premises and in the cloud, accelerates the sharing of information between multiple data stores, applications, and hosted business systems, and allows customers to re-use the same software for diverse integration scenarios. Pervasive DataRush is an embeddable parallel-processing platform enabling data-intensive applications, such as claims processing, risk analysis, fraud detection, data mining, predictive analytics, sales optimization, and marketing analytics. The company serves customers in approximately 150 countries. Pervasive Software, through Pervasive Innovation Labs, also invests in the explorat ion and creation of solutions for the data analysis and data delivery challenges. Pervasive Software, Inc. has a strategic alliance with A.D.A.M. Inc. The company was founded in 1994 and is headquartered in Austin, Texas with additional offices in Greenville, South Carolina; Brussels, Belgium; Frankfurt, Germany; Paris, France; and London, the United Kingdom.

Advisors' Opinion:

• [By CRWE]

  Pervasive Software(R) Inc. (NASDAQ:PVSW), a global leader in cloud-based and on-premises data innovation, reported that it is in receipt of an unsolicited non-binding letter from Actian Corporation proposing to acquire all of the outstanding shares of Pervasive common stock for $8.50 per share in cash.

10 Best Clean Energy Stocks To Buy For 2014: U.S. Bancorp(USB)

U.S. Bancorp, a financial services holding company, provides various banking and financial services in the United States. It generates various deposit products, including checking accounts, savings accounts, money market savings, and time certificates of deposit accounts. The company originates a portfolio of loans comprising commercial loans and lease financing; commercial real estate; residential mortgage; and retail loans consisting of credit cards, retail leasing, home equity and second mortgages, and other retail loans. It also offers wholesale lending, equipment finance, small-ticket leasing, depository, treasury management, capital markets, foreign exchange, and international trade services to middle market, large corporate, commercial real estate, and public sector clients. In addition, U.S. Bancorp provides telebanking and automated teller machine (ATM) services, as well as cash management services. The company, through other subsidiaries, provides trust, private banking, financial advisory, investment management, retail brokerage services, insurance, and custody and fund services; and payment services, including consumer and business credit cards, stored-value cards, debit cards, corporate and purchasing card services, consumer lines of credit, and merchant processing. U.S. Bancorp primarily serves individuals, estates, foundations, business corporations, and charitable organizations. It operates a network of approximately 3,031 banking offices and 5,310 ATMs. The company was founded in 1863 and is headquartered in Minneapolis, Minnesota.

Advisors' Opinion:

• [By Dividend Growth Investor]

  Another example includes financial institutions such as Bank of America (BAC), Citigroup (C ), Wachovia and US Bancorp (USB) which were regarded as safe blue-chips by investors for many years. These companies managed to boost distributions for several decades, and could be found on the dividend aristocrats lists. In fact, these companies exemplified the characteristics of the perfect dividend growth stocks, since they not only provided high yields but also grew distributions at above average rates. While the financial crisis of 2007 -2009 proved that this was all based on financial alchemy, investors who sold after dividend cuts and reinvested proceeds in other income producing securities did fairly well.

• [By Markus Aarnio]

  Banc Of California's competitors include Bank of America (BAC), JPMorgan Chase & Co. (JPM) and U.S. Bancorp (USB). Here is a table comparing these companies.

10 Best Clean Energy Stocks To Buy For 2014: Nuveen Municipal Value Fund Inc.(NUV)

Nuveen Municipal Value Fund, Inc. is a closed-ended fixed income mutual fund launched by Nuveen Investments, Inc. The fund is managed by Nuveen Asset Management. It invests in the fixed income markets of the United States. The fund also invests some portion of its portfolio in derivative instruments. It invests in undervalued municipal securities and other related investments the income, exempt from regular federal income taxes that are rated Baa or BBB or better. It employs fundamental analysis with bottom-up stock picking approach to create its portfolio. The fund benchmarks the performance of its portfolio against the Standard & Poor?s (S&P) National Municipal Bond Index. Nuveen Municipal Value Fund, Inc. was formed on April 8, 1987 and is domiciled in the United States.

Advisors' Opinion:

• [By Donald van Deventer]

  The latest implied forward rate forecast from Kamakura Corporation shows projected 10-year U.S. Treasury yields differing -0.07% to 0.03% from last week while fixed rate mortgage yields varied by -0.01% to 0.08%. Mortgage yields, determined by the Monday through Wednesday weekly survey of the Federal Home Loan Mortgage Corporation, lag Treasury movements simply because of the 3-day yield calculation used in the Primary Mortgage Market Survey. The 10-year U.S. Treasury yield is projected to rise from 2.92% at Thursday's close (down 0.06% from last week) to 3.374% (down 0.06% from last week) in one year. The 10-year U.S. Treasury yield in ten years is forecast to reach 4.639%, 1 basis point lower than last week. The 15-year fixed rate mortgage rate is forecast to rise from the effective yield of 3.69% on Thursday (down 0.001% from last week) to 4.222% (down 0.006% from last week) in one year and 6.29% in 10 years, up 0.038% from last week. We explain the background for these calculations in the rest of this note, along with some mortgage servicing rights metrics. The forecast allows investors in exchange traded U.S. Treasury funds (TLT) (TBT), total return bond funds (BOND), municipal bonds (NUV) and exchange traded mortgage funds (REM) to assess likely total returns over the next 120 months. Treasury-related exchange traded funds affected by the forward rates include:

• [By Adam Aloisi]

  The following chart takes a comparative look at some widely held ETFs/CEFs holding different types of bonds. The objective is to visualize not only how much these products cost, but also to break down the percent of total yield depleted by management fees. I define total yield as current annualized yield plus net fees - in other words the yield of the fund if there were no management fees attached. The funds we will examine are aforementioned BND, iShares 20+ Treasury Bond (TLT), iShares High-Yield Corporate (HYG), Nuveen Municipal Value (NUV), Eaton Vance Limited Duration (EVV) and Alliance Bernstein Global High-Yield (AWF).

10 Best Clean Energy Stocks To Buy For 2014: France Telecom S.A.(FTE)

France Telecom provides fixed telephony and mobile telecommunications, data transmission, Internet and multimedia, and other value-added services to consumers, businesses, and telecommunications operators. It also offers personal and home communication services, business network services, international carriers and shared services, and integration and outsourcing services for communication applications. The company operates in France, Spain, Poland, the United Kingdom, and internationally. France Telecom was founded in 1990 and is based in Paris, France.

10 Best Clean Energy Stocks To Buy For 2014: PulteGroup Inc. (PHA)

PulteGroup, Inc., through its subsidiaries, engages in homebuilding and financial services businesses primarily in the United States. The company�s homebuilding business includes the acquisition and development of land primarily for residential purposes within the United States; and the construction of housing on such lands. It offers various home designs, including single-family detached, townhouses, condominiums, and duplexes under the Pulte Homes, Del Webb, and Centex brand names. As of December 31, 2011, its homebuilding operations offered homes for sale in approximately 700 communities. The company�s financial services business consists of mortgage banking and title operations. It arranges financing through the origination of mortgage loans for its homebuyers; sells such loans and related servicing rights; and provides title insurance policies as an agent, and examination and closing services to its home buyers. The company was formerly known as Pulte Homes, Inc. an d changed its name to PulteGroup, Inc. in March 2010. PulteGroup, Inc. was founded in 1956 and is headquartered in Bloomfield Hills, Michigan.

10 Best Clean Energy Stocks To Buy For 2014: Metroline(MRO.L)

Melrose PLC operates as an engineering company worldwide. Its Energy segment offers power generation equipment; synchronous motors, induction motors, submersible, and traction motors; power management and excitation systems; medium voltage AC and DC switchgears; and power and system transformers, as well as aftermarket services for power generation plants, oil and gas, utilities, industrial, marine, rail, telecommunications, construction, commercial, military, and aftermarket sectors. The company?s Lifting segment provides wire ropes, fiber ropes, wires, hooks, shackles, blocks, sheaves, clamps, links, material handling products, monorail systems, chain hoists, industrial carts, and trailers for onshore and offshore oil and gas, deep shaft and surface mining, petrochemical, alternative energy, general industrial and construction, fishing and marine, infrastructure, and material handling industries. Its Other Industrial segment offers window and door hardware; balers, shea rs, waste compactors, and auto shredders; automotive trims and moldings; widgets for cans; and sealing products for housing, construction, retail, scrap processing, fiber recycling, automotive, consumer packaging, brewing, food distribution, power tools, industrial, medical, office furniture, and general engineering sectors. The company is headquartered in London, the United Kingdom.

10 Best Clean Energy Stocks To Buy For 2014: MELA Sciences Inc(MELA)

MELA Sciences, Inc., a medical device company, focuses on the design and development of a non-invasive, point-of-care instrument to assist in the detection of early melanoma. The company?s principal product, MelaFind, features a hand-held imaging device that emits multiple wavelengths of light to capture images of suspicious pigmented skin lesions and extract data. This product uses automatic image analysis and statistical pattern recognition to help identify lesions to be considered for biopsy to rule out melanoma. It consists of hand-held imaging device, which employs high precision optics and multi-spectral illumination; database of pigmented skin lesions; and lesion classifiers, which are mathematical algorithms that extract lesion feature information and classify lesions. MELA Sciences submitted the MelaFind pre-market approval application with the U.S. Food and Drug Administration (FDA) in June 2009 and is under review at the FDA. The company was formerly known as E lectro-Optical Sciences, Inc. and changed its name MELA Sciences, Inc. in April 2010. MELA Sciences, Inc. was founded in 1989 and is based in Irvington, New York.

10 Best Clean Energy Stocks To Buy For 2014: The Spectranetics Corporation (SPNC)

The Spectranetics Corporation designs, manufactures, and markets single use medical devices used in minimally invasive surgical procedures within the cardiovascular system in conjunction with its proprietary excimer laser system, the CVX-300. The company?s excimer laser technology is used to ablate multiple lesion morphology morphologies, such as plaque, moderate calcium, and thrombus. It offers four primary product categories for the Vascular Intervention product line, including peripheral atherectomy, coronary atherectomy, thrombus management, and crossing solutions. The peripheral atherectomy product line consists of a selection of proprietary laser catheters that are indicated for the treatment of infrainguinal (leg) stenoses and occlusions; and the coronary atherectomy product line includes a selection of proprietary laser catheters to be used in various types of coronary artery diseases comprising occluded saphenous vein bypass grafts, ostial lesions, long lesions, m oderately calcified stenoses, total occlusions traversable by guidewire, lesions, and restenosis. The thrombus management product line consists of three thrombus removal devices intended to remove fresh, soft thrombi, and emboli from vessels in the arterial system, as well as to address thrombotic occlusions in dialysis grafts and fistulae; and the crossing solutions product line support guidewires or other devices in facilitating vascular access in the arterial system to enable various types of interventions. The company?s lead management product line comprises excimer laser sheaths, non-laser sheaths, and cardiac lead management accessories for the removal of pacemaker and defibrillator cardiac leads. It sells its products in the United States, Canada, Europe, the Middle East, the Asia Pacific, Latin America, and Puerto Rico. The company has a strategic alliance with Kensey Nash Corporation. The Spectranetics Corporation was founded in 1984 and is based in Colorado Springs , Colorado.