Every week, Sam Antar or Gary Weiss will find something amiss with Overstock (OSTK). These two bloggers, combined, must be spending at least 16 hours a week researching and writing about a $125 million stock. According to their disclosures, they have no position.
Since I can't afford to spend that much time investigating individual trees, I'll stick to sharing my thoughts on what I perceive to be an extraordinary forest.
A tale of two retailers – part one, the importance of inventory turnover.
The guy selling used cars needs an inventory of, say, 20 cars to sell 1 today. That's an inventory of $200,000 for $10,000 of revenue. After buying a replacement car to top-up his inventory, paying the rent etc., he takes home $1,000. That's a 10% margin on an inventory turnover of 5%.
Our guy is married to a baker. She needs an inventory of about $20,000 (flour, yeast, etc.), to sell $10,000 worth of bread today. After buying some new flour and paying for costs, she too takes home $1,000. Her margin too is 10% but the inventory turnover is 50%.
The couple decides it's time to expand. They need just $1,000 per day to live on. They can invest the other $1,000. The wife tells him she can open an extra bakery within a month without going to the bank for a loan. He just can't believe it. His dad spent a decade repaying the loan they needed to setup the family business.
Overstock's numbers are unbelievable
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Overstock's inventory turnover is better than the other retailers combined. Unbelievable! I'll be writing about it in part two of my "tale of two retailers."
Days payable is an indicator of how quickly a company pays its creditors. Overstock is beaten (just) by Costco (COST). Both companies, on average, pay their creditors within a month. In this business it's not unusual to keep your creditors waiting for two months or mor! e. Overstock and Costco are the exceptions.
Assuming Internet retail is a commodity, it stands to reason that Overstock should be able to raise gross margins to about 20% without losing a lot of market share to Amazon, Blue Nile or for that matter, Bluefly. Overstock has untapped pricing power.
So now you know why Francis Chou is long Overstock and why Costco is Charles Munger's favorite company.
A tale of two retailers - part two, Overstock.
Overstock is a couple (pun intended) of retailers.
Fifteen percent of revenue and roughly 100% of the inventory is carried by the direct business, a "classic" retail operation. They buy stuff (mainly closeout lots) and sell it (hopefully) at a profit.
The other 85% of revenue is from the fulfillment partner division. This is not a classic retailer, this is a broker. Overstock sells merchandise of other retailers, cataloguers or manufacturers ("fulfillment partners") through their website. This is a retailer without inventory! Here too, Overstock deals with closeout lots. The original manufacturer (say, Calvin Klein) doesn't want last year's watch to compete with this year's model. They won't be touting it on their own website or in their own shop — that's where Overstock comes in. Calvin Klein will list last years unsold watches on Overstock.com.
This division is growing at a fair clip. Again, this is a broker. Customers pay for the purchase upfront and Overstock pays the supplier later. This is inherently a negative equity business. The business model is not unlike Dell a decade ago.
Are they going bankrupt?
Summary: No.
$100 million of cash on $20 million of debt.
Should they choose to extend their "days payable" from the current 30 to a more normal 60 days, at least 1/12 of annual revenue converts into cash on the balance sheet: 1/12 * 1 billion => $85 million.
The "direct" business is in decline. Assuming it continues down that road, that inventor! y, at 0% ! gross margin, converts into $25 million of cash.
Unlike a typical retailer, they don't need that cash to build seasonal inventory. It's truly excess cash.
Why is revenue flat? Why aren't they profitable?
As discussed, they don't need the cash. For now, they are content to invest for growth and kill the competition with low margins. Direct competitors are Bidz.com (toast) and Bluefly (no cash and negative FCF).
Sixty percent of revenue is from "home and garden" and 99% of revenue is from U.S.
Growth is tied to the housing market.
So what is the company worth to me today ?
I would pay $ 160 million ($ 7 per share) for the entire company in an instant. I would defer payment of the creditors for an extra month (that would bring it in line with the competition) and use the $ 85m of cash thus generated plus the $ 100m that's already on the balance sheet to pay myself a $ 180 million dividend next month. I would then distribute ownership of the company to the employees and go fishing.
Prem Watsa says I'm a terrible analyst and a worse LBO artist. He says it's worth more, much more.
Read more:
recent 10k
Sam Antar and Gary Weiss
Gusto Duel submitted OSTK for the value ideas contest
Anh Hoang discussed OSTK
Citron Research covered the space; NOT bearish on Overstock !
Geoff Gannon on Overstock in 2006
Disclosure
This is not a recommendation to buy or sell anything. At the time of writing, I had no position in any of the stocks mentioned. Any and all questions welcome as usual.
When it comes to equipment and services in the energy space, "strong market share" is usually pretty relative. In many markets, a company is doing very well if it can get 25% or one-third of a market to themselves, which makes Oceaneering International's (NYSE:OII) nearly 60% share of the deepwater rig support market pretty significant.
What's more, this is not just a "market share at any cost" story, as the company has a pretty remarkable record of consistent operating margin and ROIC performance despite the vagaries of the deepwater energy market. The problem for investors is in figuring out what constitutes a fair multiple for all of these positives.
SEE: Oil And Gas Industry Primer
A Strong ROV Fleet Leads The Way
Oceaneering operates a fleet of nearly 300 ROV vehicles, which is the largest fleet out there insofar as I can tell. These ROVs are useful in a wide range of tasks, including visual inspection, repair, and equipment installation, and in many cases are essential to a deepwater operation. About three-quarters of this fleet is used to support deepwater drilling and production platforms, while the remainder is used in the construction and field maintenance activities of companies like Saipem and Tidewater (NYSE:TDW).
Oceaneering is one of the relatively few companies to both manufacture and operate ROVs, and it costs about $5 million to build a new one (for a useful life of about eight years). Having the means to build an ROV is not really the relevant factor in this business, though, as the ability to operate them effectively and get the job done is paramount. To that end, Oceaneering enjoys close to 60% share across the floater fleet and close to 80% share in the deepwater and ultra-deepwater operations, with Saipem and Helix Energy (NYSE:HLX) among the very few publicly-traded rivals of any size.
It's Not All About ROVs, Though
While Oceaneering has an excellent business with its ROV operations, that's only about half of what the company does. Another significant part of the company's operations involve subsea products and projects – providing products like umbilicals and the installation of the undersea hardware (trees, valves, connectors, blowout preventers, and so on) made by companies like FMC Technologies (NYSE:FTI) and General Electric (NYSE:GE).
Oceaneering also has substantial operations in "asset integrity" and "advanced technologies" - businesses that involve improving safety and reliability for energy companies and special services for clients ranging from the U.S. Navy to NASA to water theme park operators.
Tied To The Right Trends
With it strong share and limited competition, Oceaneering looks like a near-certain winner in this building offshore cycle. Whether an E&P company goes with Transcoean (NYSE:RIG) or Seadrill (Nasdaq:SDRL) for a deepwater drilling project, there's a good chance Oceaneering gets the call to support its with its ROVs. Whether a company goes with GE's subsea trees or those from Aker, there's a good chance that Oceaneering will install them. That's a good place for any company to be, and I like the odds that Oceaneering will see a significant pick up in activity over the next few years.
The Bottom Line
The only real issue with the story is that none of this is a secret. Analysts and investors know all about the company's strong share in its targeted markets, as well as the significant awards that have been made for offshore drilling and production projects. Likewise, it's no secret that Oceaneering has registered some rather remarkably consistent financial results over the years.
So what is all of that worth? On the whole, it's pretty rare to see an energy services company support an EV/EBITDA multiple above 9x until well into the cycle, and that would only suggest a fair value in the mid-$60s today. While I think you can argue that Oceaneering is as deserving of a premium valuation as any service company (particularly in the offshore space), I think a lot of the benefits of the coming offshore cycle are in this stock and I'd wait for a pullback before making a major purchase.
Pfizer Inc. (PFE) recently announced that it has received EU approval for an expanded indication for its pneumococcal conjugate vaccine, Prevenar 13. With this approval, Prevenar 13 can now be used for the active immunization of adults 18 to 49 years of age for the prevention of invasive disease caused by vaccine-type Streptococcus pneumoniae (S. pneumoniae).
Prevenar 13 was earlier approved in the EU for use in infants, young children and adolescents (6 weeks to 17 years old) and adults ≥50 years of age. However, with the new expanded label, Prevenar 13 can now be used in the EU for all patient populations starting from infancy.
We note that EU approval for use in children 6 to 17 years of age was received earlier this year. Prevenar 13 is approved and marketed in several countries including the US where it is known as Prevnar 13.
The US label includes approval for use in infants, young children and adolescents children (6 weeks through 17 years of age) and adults 50 years of age and above. Prevnar 13 is also approved in children (6 weeks through 5 years) for the prevention of otitis media caused by 7 of the 13 strains.
Pfizer reported Prevnar/Prevenar 13 sales of $3.7 billion in 2012, up 2%. Pfizer is currently conducting the Community-Acquired Pneumonia Immunization Trial in Adults (CAPiTA) in people ≥ 65 years of age.
The study has been designed to evaluate whether Prevnar 13 is effective in preventing the first episode of community-acquired pneumonia caused by the serotypes contained in the vaccine. Pfizer expects this event-driven study to complete in the second half of 2013.
Pfizer currently carries a Zacks Rank #3 (Hold). Pfizer recently lowered its earnings and revenue outlook for 2013 following the divestment of its stake in its former animal health business, Zoetis, Inc. (ZTS).
Companies that currently look well-positioned include Jazz Pharmaceuticals (JAZZ) and Santarus, Inc. (SNTS). While Jazz is a Zacks Rank #1 (Strong Buy) stock, ! Santarus carries a Zacks Rank #2 (Buy).
Jim Cramer is down on tech at the moment, but he sees big things in the cards for industrial heavyweights like General Electric (NYSE:GE) and Honeywell (NYSE:HON). In fact, the opinionated CNBC host told "Squawk Box" Friday he sees GE joining the slate of companies with growth on the way.
Cramer backed his boisterous take on GE's earnings report with references to growing profit margins in several GE divisions.
"One of the reasons why I like what I see from General Electric is that, in almost every business, the margins were improving," he said on Friday. "Their power, their water infrastructure, that had been…the really big disappointment. The margins were up there, too."
Cramer was also enthusiastic about Jeff Immelt's earlier comments. Immelt, the chief executive of GE, had projected a positive viewpoint following GE's earnings report. Cramer noted the contrast to what was happening among technology companies.
"It's almost as if these companies are doing everything right and tech seems to be doing everything wrong."
But Cramer mainly wanted to state his case why he saw GE stock headed for gains. Citing the aerospace sector, Cramer saw a major bull market, which would help Boeing (NYSE:BA) along with GE and Honeywell, all of whom are benefiting from an improved U.S. industrial business.
"You get the margins up, GE joins the crowd of companies that go higher here," he said on "Squawk Box." Cramer also believes GE shareholders will see better dividend payments in the coming quarters. "I think this company is going to be returning more capital, increasingly."
Cramer made it clear he didn't support those who say stagnant revenues are a warning sign for big industrial companies. "Those people have been so wrong, it's frightening." He said it all comes down to the margins, which are improving for GE and the other industry powerhouses.
GE's Friday earnings report was enough to boost the stock some 5 percent in afternoon trading, with analysts predicting good things ahead for the manufacturing sector across the world, which is usually boosted by the strength of companies like GE.
"It is encouraging to see customers willing to sign agreements for a new piece of capital equipment. That indicates a level of certainty in the economic situation," one Morningstar analyst told Reuters.
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Everyone's always looking for the very best buying and selling opportunities in today's uncertain market, and here to help you analyze the long-term prospects of a multinational retailer is Zarr Pacificador, from The Motley Fool UK.
What are the long-term prospects for Tesco Plc (LSE:TSCO) (NQ:TESO)?
I'm always searching for shares that can help ordinary investors like you make money from the stock market.
Right now I am trawling through the FTSE 100 and giving my verdict on every member of the blue-chip index.
I hope to pinpoint the very best buying opportunities in today's uncertain market, as well as highlight those shares I feel you should hold...and those I feel you should sell!
I'm assessing every share on five different measures. Here's what I'm looking for in each company:
1. Financial strength: low levels of debt and other liabilities;
2. Profitability: consistent earnings and high profit margins;
3. Management: competent executives creating shareholder value;
4. Long-term prospects: a solid competitive position and respectable growth prospects, and;
5. Valuation: an underrated share price.
A look at Tesco
Today I'm evaluating Tesco, a British multinational retailer, which currently trades at 363p. Here are my thoughts:
1. Financial strength: Tesco is in solid financial position. Net debt/operating cash flow is less than 2 times; net gearing is 50%; interest cover is an adequate 7.5 times; and free cash flow has averaged nearly £2bn per year over the last 3 years.
2. Profitability: Tesco has delivered outstanding growth for nearly two decades. However, with the continuing weakness in Europe and facing stiff competition at home, the company has struggled of late. In the last fiscal year, underlying profit before tax declined by 15%, while underlying earnings per share fell by 14%. Forced to compete in price, the company's margins have contracted from to 3.4% from 5.6% the previous year. Also, international trading profit declined by 22%, due to the impact of regulatory changes in South Korea and impairment of businesses in Turkey, Poland, and the Czech Republic.
3. Management: I believe the company's new direction under Philip Clarke, which focuses on developing its multichannel footprint, strengthening its core UK business, and adopting a more prudent international growth strategy, places the company in a better position moving forward.
4. Long-term prospects: Tesco has fallen out of favor with investors recently after a rough 18 months, where it was rocked by the horsemeat scandal, several quarters of declining market share and like-for-like sales, and write-offs of its Fresh and Easy US business and several UK properties of more than £1bn and £804m, respectively. However, despite the grim outlook, I believe Tesco's competitive position remains solid. It is still the largest UK grocer with a market share of 30%—almost doubling that of its closest rival Wal-Mart's ASDA. It also owns the UK's widest store network, with around 3,000 stores and the world's largest and most profitable online supermarket, which reached a record-high revenue of over £3bn last year. In addition, it is the number one or two retailer for general merchandise in eight out of nine of its international markets. Furthermore, to adapt to the rapidly changing retail environment, the company has announced new strategic objectives which include: a shift from traditional large-store formats to building its multichannel retail capabilities, such as convenience and online retailing; focusing on its core UK operations to maintain its leading position—the company has invested around £1bn to overhaul its superstores; and adopting a more disciplined approach to international expansion, concentrating only on markets that could deliver strong investment returns.
5. Valuation: With a market cap of £30bn, Tesco trades at a forward price-to-earnings (P/E) ratio of 11—slightly below its 10-year median P/E of 13 and the industry average of 12—and a prospective dividend yield of 4%, twice covered.
My verdict on Tesco
Although recent results have been disappointing and with competition in the UK likely to remain competitive, I think the company still owns a distinct advantage with its scale and size. Also, its profitable international business—29% of the company's profits come from outside the UK—and established online presence could be a source of future growth opportunities.
Moreover, the company intends to tighten capital spending during the next few years—around 3.5% to 4% of revenue—which will add to its already strong cash flow. What's more, shares are trading at an undemanding P/E of 12, a discount compared to its peers Wal-Mart and Carreouflour. So overall, I believe Tesco at 363p looks like a buy.
Zarr does not own any share mentioned in this article. The Motley Fool owns shares in Tesco.
Read more from The Motley Fool UK here...
Here is the transcript of the exclusive interview on CNBC-TV18. Also watch the accompanying video.
Q: What exactly does one mean when one talks about instruments of fund raising?
Nayar: I think as a company looks at its growth plans and capital expenditure requirements, they obviously take care of it through internal resources first. Over and above that they have options of raising either debt or equity. Within equity also there can be pure equity or convertibles, which are equity like instruments which get converted to equity or can stay as debt.
Q: Is this always done in order to do capital raising or sometimes it is also done in order to get in a strategic investor etc. In that, are there different layers to why a company chooses to do fund raising or is it just as simple as the capex issue?
Chatterjee: From a pure corporate finance point of view, there would be several angles to look at it. If one looks at fund raising for capex, which is the most obvious, whether it is in capex or growth, one first one needs to ensure that the company's long-term strategy is aligned to growth. And, within growth then to use fund raising as the enabler to make it happen.
Sometimes one looks at the capital structure and the need to balance capital structure either ways, whether it is towards debt or equity, it depends on where that structure is, if it is over capitalized in terms of equity and you are paying too much taxes, you would certainly want to get some tax shield to ensure that there is a rebalancing and it can be vice-versa.
The third thing is the instrument selection or the financing strategy. One looks at what instruments work for that particular company, given its track record of cash flows and earnings.
And, finally one looks at the market and sees what is the right time to access the market and in which form.
Did you read: Tata Power ends $300M PE fund-raising with Olympus Cap
Q: From a minority shareholders point of view, how should one read these fund raising exercises by a company? Do they have an impact on the company's core business or performance as a stock as well?
Sharma: Yes, certainly. Depending on what kind of fund raising it is, whether it is equity or debt and also from perspective of which investor base it is raising. The existing minority shareholders if they do not participate in that equity offering will get diluted. So to that extent they will be impacted. As long as it is debt, they also need to look at how it impacts the capital structure and the future growth of the company.
Q: On the equity side, one can raise money via an initial public offering (IPO) which is step one, but how beneficial is it going down the equity route whether it is an IPO or a preferential share issue from a company's point of view?
Chatterjee: Equity is obviously a form of capital raising where one has to be very careful in the context of two to three things. One is in the earnings per share (EPS) implications of raising equity. Whether one goes through an IPO or a private placement or bring in strategic investors, is functional of again where the capital structure wants to be. And, if one wants to have an equity-biased capital structure we need to look at raising equity.
A listed company would perhaps go in for a follow-on public offer (FPO) or a private placement or induction of a strategic partner or even a preferential allotment to the existing shareholders.
For an unlisted company, it could be in the form of an IPO or simple private placement by a financial or strategic partner. So, the key consideration is whether that equity which is effectively costlier than debt can be serviced and can be value accretive going forward for the shareholders.
Q: What exactly should a retail investor or any shareholder actually look at when a company announces equity offering because there is a) potential dilution that will happen b) potential dilution on the earnings itself. I guess if it's preferential you will have to wonder about which kind of parties are coming into the company.
Sharma: I think from the perspective of any investors, categorized into two'one who is an existing shareholder and two is somebody who is coming in new. What they need to look at is going top down in terms of what the industry dynamics are. How the company is doing in that industry and finally what the backing of the promoters or other strategic investors is. Also they need to look at what is the planned fund raising going to be used for. That is also important consideration because it would have an impact on future growth of the company.
Q: You have participated and run many follow-on offers for companies, how does one marry this mismatch that starts happening between the listed price and the way it starts reacting to news of a follow-on because immediately for many stocks especially from the public sector there is a deceleration in the price performance expecting the FPO to be at a much lower price point?
Nayar: Usually follow-on have little more flexibility on pricing. Also, since it's a more intensive an effort in terms of distribution and there is whole host of cost that go along with it, the feeling is that one will try and price it in such a way that the follow-on goes through and doesn't lead to an overhang.
Any retail investor would not like to pay a premium because they can buy that stock in the market at market related prices. So, most follow-ons always happen at a discount of about 5%. So usually in that sense investors start expecting 3-5% discount and start playing on that arbitrage.
Q: How elegant an option is it when you look at equity fund raising instruments because you have to consider the retail minority shareholder, you have to consider some kind of discount and you also have to take into account the kind of pressure your stock may face because of that impending follow-on offer?
Chatterjee: In India the route to access the capital markets especially in the secondary side, for a listed company, depends on how the stock performs post the announcement. The period to close fund raising is very critical to ensure that there is a balance between what the company wants and what the investor wants. I still believe that rights and FPO should be done in a shorter period of time and that would be a great benefit both to the issuer as well as the investor.
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The U.S. Energy Department's weekly inventory release showed an in-line rise in natural gas supplies, as the commodity's brisk use for power generation in the face of summer temperatures were offset by strong production growth. However, on a bearish note, the build was ahead of the five-year average levels, thereby narrowing the deficit with the benchmark.
About the Weekly Natural Gas Storage Report
The Weekly Natural Gas Storage Report – brought out by the Energy Information Administration (EIA) every Thursday since 2002 – includes updates on natural gas market prices, the latest storage level estimates, recent weather data and other market activities or events.
The report provides an overview of the level of reserves and their movements, thereby helping investors understand the demand/supply dynamics of natural gas. It is an indicator of current gas prices and volatility that affect businesses of natural gas-weighted companies and related support plays.
Analysis of the Data
Stockpiles held in underground storage in the lower 48 states rose by 72 billion cubic feet (Bcf) for the week ended Jun 28, 2013, within the guided range (of 70–74 Bcf gain) as per the analysts surveyed by Platts, the energy information arm of McGraw-Hill Financial Inc. (MHFI). But the increase – the twelfth injection of 2013 – exceeded both last year's build of 41 Bcf and the 5-year (2008–2012) average addition of 71 Bcf for the reported week.
Despite past week's build, the current storage level – at 2.605 trillion cubic feet (Tcf) – is down 491 Bcf (15.9%) from the last year and is 30 Bcf (1.1%) below the benchmark five-year average.
Natural gas stocks hit an all-time high of 3.929 Tcf last year, as production from dense rock formations (shale) – through novel techniques of horizontal drilling and ! hydraulic fracturing – remained robust. In fact, the oversupply of natural gas pushed down prices to a 10-year low of $1.82 per million Btu (MMBtu) during late Apr 2012 (referring to spot prices at the Henry Hub, the benchmark supply point in Louisiana). However, things have started to look up in recent times. This year, cold winter weather across most parts of the country boosted natural gas demand for space heating by residential/commercial consumers. This, coupled with flat production volumes, meant that the inventory overhang has now gone, thereby driving commodity prices to around $4.40 per MMBtu in Apr – the highest in 21 months. Following this, natural gas demand went through a lean period, with the end of the winter heating season and ahead of the peak cooling loads for summer. In this timeframe, the commodity experienced a number of above-average builds, thereby pulling down prices again. Outlook With hot weather expected to prevail over the country during the next few weeks, leading to strong electricity draws to run air conditioners, the commodity's price may experience another upward curve. This, in turn, is expected to buoy natural gas producers, particularly low cost suppliers like Ultra Petroleum Corp. (UPL), and big players including Chesapeake Energy Corp. (CHK) and Exxon Mobil Corp. (XOM) With the financial incentive to produce the commodity and the subsequent improvement in the companies' ability to generate positive earnings surprises, they are likely to move higher from their respective Zacks Ranks. As of now, Ultra Petroleum and Exxon Mobil are Zacks Rank #3 (Hold) stocks, while Chesapeake currently retains a Zacks Rank #2 (Buy).
On Jul 5, 2013, we reiterated our Neutral recommendation on Texas Capital BancShares Inc. (TCBI), primarily based on increased revenues. However, higher expenses were the downside. Why Neutral? The company's first-quarter earnings of 80 cents per share lagged the Zacks Consensus Estimate but beat prior-quarter earnings by 14%. Additionally, over the last 60 days, the Zacks Consensus Estimate for 2013 inched up 0.3% to $3.29 per share. For 2014, over the same time period, the Zacks Consensus Estimate moved north by 0.6%. We are impressed with the growth of Texas Capital BancShares. Amid a sluggish Texan economy, the company's gain in market share from its economizing competitors was a positive. Texas Capital BancShares' relationship-based model has been the main driver for revenue and asset growth over the past 5 years. Additionally, the company's capital ratios remain above the levels required to be considered well capitalized. We believe that Texas Capital BancShares' strong capital position will help in both organic growth with the addition of loan and deposit relationships, and in opportunistic expansions in the future. However, we are concerned about the company's rising expenses, which are likely to affect top and bottom-line growth. Further, Texas Capital BancShares is primarily a Texas-based company and without any efforts at diversification, its top and bottom lines are likely to suffer. Additionally, intense competition from nationwide and regional financial institutions and declining demand in mortgage warehouse lending volume could weigh on non-interest income. Earnings Whispers? Texas Capital is scheduled to release second-quarter earnings on Jul 24. The Zacks Consensus Estimate for the second quarter is 80 cents. The earnings ESP(Read: Zacks Earnings ESP: A Better Method) for the company is 1.25% for the quarter. This, along with its Zacks Rank #3 (Hold), makes us confident for a positive earnings surprise. Other Sto! cks to Consider Texas Capital BancShares is not the only firm looking up this earnings season. We also anticipate earnings beat by 3 other regional banks: Prosperity Bancshares Inc. (PB), with earnings ESP of 2.27% and a Zacks Rank #2 (Buy). First Horizon National Corporation (FHN), with earnings ESP of 5.26% and a Zacks Rank #3. Fifth Third Bancorp (FITB), with earnings ESP of 4.55% and a Zacks Rank #3.
Below is the verbatim transcript of Navlakhi's interview with CNBC-TV18. Q: The unanimous advice for those nearing retirement is to start moving equity investments into debt funds. Which are the better performing debt funds you can advice at this juncture? A: Debt funds are fairly complicated and it would be nice if one contacts a financial advisor because different sets of debt funds have different implications. Debt funds would move based on currency, interest rate, demand supply and host of other factors that play into effect. Therefore, the best way to approach debt fund would be to segregate and create a ladder of investment that means have certain money which is maturing with an investment horizon for 12-15 months, certain for little longer and then for three-five years. I would recommend funds like Templeton India Short Term Income Plan for people with 12-15 month time horizon. If one is looking at 15-18 months then there is Birla Sun Life Short Term Opportunities Fund . If one is looking for bond opportunities for three-four years then look at ICICI Prudential Corporate Bond Fund . Therefore, these are three different types of funds with different tenures. The last one year returns have been between 10.5 percent to 11.5 percent and that would virtually be tax free because one will get an indexation benefit. If one wants to take some risk, if one is a little experienced investor then consider some of the dynamic bond funds. If one wants to be in conservative dynamic bond fund then look at Birla Sun Life Dynamic Bond Fund or IDFC Super Saver Income Fund - Medium Term and for little more aggressive there is Reliance Dynamic Bond or IDFC Dynamic Bond Fund . Returns of these have also been in the range of 11-12 percent but if looked at returns as of two days ago then the aggressive dynamic bond funds have given almost 14 percent in the last one year. Therefore, one should know that there are these opportunities but at the same time approach it with caution because these funds could go down if interest rates went up in the market.
Research by NSS Labs indicates that in its testing, Microsoft� (NASDAQ: MSFT ) �Internet Explorer and Google� (NASDAQ: GOOG ) �Chrome are the safest browsers. NSS, which bills itself as "the world's leading information security research and advisory company," recenlty unveiled the results of its Browser Security Comparative Analysis: Socially Engineered Malware. Over the course of 28 days, from March 13 through April 9, the firm tested the five, most popular browsers against 754 samples of real-world malicious software. The browsers were�Apple� (NASDAQ: AAPL ) Safari 5,�Google�Chrome 25/26, Microsoft�Internet Explorer 10, Mozilla Firefox 19, and Opera 12. The results revealed significant safety differences. Blocking technologies used by browsers (higher is better).
Source: NSS-Browser Security Comparative Analysis Top Tech Stocks To Invest In 2014: ONEOK Inc.(OKE) ONEOK, Inc., a diversified energy company, operates as a natural gas distributor primarily in the United States. The company operates in three segments: ONEOK Partners, Distribution, and Energy Services. The ONEOK Partners segment engages in gathering, processing, fractionating, transporting, storing, and marketing natural gas and natural gas liquids (NGL) principally in the Mid-Continent and Rocky Mountain regions, which include Anadarko Basin of Oklahoma, Fort Worth Basin of Texas, Hugoton and Central Kansas Uplift Basins of Kansas, Williston Basin of Montana, and North Dakota and the Powder River Basin of Wyoming. This segment offers its services to oil and gas production companies; natural gas gathering and processing companies; petrochemical, refining, and NGL marketing companies; Local distribution companies (LDCs) and power generating companies; and natural gas marketing and NGL gathering companies, and propane distributors. The Distribution segment provides natural gas distribution services to residential, commercial, industrial, and transportation customers, as well as public authority customers, such as cities, governmental agencies, and schools in Oklahoma, Kansas, and Texas. The Energy Services segment delivers physical natural gas products and risk management services through its network of contracted transportation and storage capacity, and natural gas supply. This segment?s customers primarily comprise LDCs, electric utilities, and industrial end users. The company was founded in 1906 and is headquartered in Tulsa, Oklahoma. Advisors' Opinion: - [By GuruFocus] Tom Gayner initiated holdings in ONEOK, Inc.. His purchase prices were between $41.16 and $52.13, with an estimated average price of $46.98. The impact to his portfolio due to this purchase was 0.1%. His holdings were 70,000 shares as of 06/30/2013.
New Purchase: Blackstone Group LP (BX)
Tom Gayner initiated holdings in Blackstone Group LP. His purchase prices were between $19.1 and $23.45, with an estimated average price of $21.2. The impact to his portfolio due to this purchase was 0.09%. His holdings were 116,900 shares as of 06/30/2013.
New Purchase: BlackRock Inc (BLK)
Tom Gayner initiated holdings in BlackRock Inc. His purchase prices were between $245.3 and $291.69, with an estimated average price of $267.9. The impact to his portfolio due to this purchase was 0.08%. His holdings were 9,100 shares as of 06/30/2013.
New Purchase: KKR & Co LP (KKR)
Tom Gayner initiated holdings in KKR & Co LP. His purchase prices were between $17.8 and $21.15, with an estimated average price of $19.85. The impact to his portfolio due to this purchase was 0.08%. His holdings were 115,000 shares as of 06/30/2013.
New Purchase: Eni SpA (E)
Tom Gayner initiated holdings in Eni SpA. His purchase prices were between $40.39 and $48.96, with an estimated average price of $45.85. The impact to his portfolio due to this purchase was 0.04%. His holdings were 30,000 shares as of 06/30/2013.
New Purchase: Ross Stores, Inc. (ROST)
Tom Gayner initiated holdings in Ross Stores, Inc.. His purchase prices were between $59.26 and $66.5, with an estimated average price of $64.05. The impact to his portfolio due to this purchase was 0.04%. His holdings were 18,000 shares as of 06/30/2013.
New Purchase: Carlyle Group LP (CG)
Tom Gayner initiated holdings in Carlyle Group LP. His purchase prices were between $24.19 and $32.87, with an estimated average price of $29.56. The impact to his portfolio due to this purchase was 0.02%. His holdings were 20,000 sha! res as of 06/30/2013.
Sold Out: EOG Resources (EOG)
Tom Gayner sold out his holdings in EOG Resources. His sale prices were between $113.44 and $137.9, with an estimated average price of $128.22.
Sold Out: State Street Corp (STT)
Tom Gayner sold out his holdings in State Street Corp. His sale prices were between $56.51 and $67.44, with an estimated average price of $62.2.
Sold Out: Bunge Ltd (BG)
Tom Gayner sold out his holdings in Bunge Ltd. His sale prices were between $66.4 and $73.51, with an estimated average price of $70.39.
Added: UnitedHealth Group Inc (UNH)
Tom Gayner added to his holdings in UnitedHealth Group Inc by 45.25%. His purchase prices were between $58.54 and $66.09, with an estimated average price of $62.22. The impact to his portfolio due to this purchase was 0.4%. His holdings were 569,800 shares as of 06/30/2013.
Added: Liberty Media Corporation (LMCA)
Tom Gayner added to his holdings in Liberty Media Corporation by 102.38%. His purchase prices were between $108.75 and $130.01, with an estimated average price of $119.32. The impact to his por
Top Tech Stocks To Invest In 2014: PFSweb Inc.(PFSW) PFSweb, Inc. provides business process outsourcing and ecommerce solutions in the United States, Canada, and Europe. It offers digital marketing services comprising search engine optimization, pay-per-click, affiliate marketing, comparison shopping engines, merchandising, Web analytics, customer experience, email marketing, and social media; and ecommerce technology services, including End2End eCommerce solution for the direct-to-consumer (DTC) and business-to-business (B2B) online channels. The company also provides order management services consisting of order management interfaces, collaboration technologies, and information management services; customer care services, including customer relationship management, customer order assistance, quality monitoring, and interactive voice response; and logistics and fulfillment services comprising distribution facilities and infrastructure, facility operations and management, kitting and assembly, and product management and insp ection. In addition, it offers financial management services consisting of billing, credit, collection, and cash application services for B2B clients, as well as fraud review, chargeback management, and processing and settlement credit card services for DTC clients; and professional consulting services in the areas of interactive marketing ecommerce, supply chain management, distribution and fulfillment, technology interfacing, logistics, and customer support. Further, the company provides seller services financial models, including enablement financial, agent or flash financial, and retail financial models. It serves fashion apparel and accessories, fragrance and beauty products, consumer packaged goods, home furnishings and housewares, consumer electronics, office technology and network connectivity products, and aviation spare parts industries. The company was founded in 1999 and is headquartered in Allen, Texas. CBS Corporation, together with its subsidiaries, operates as a mass media company in the United States and internationally. The company?s Entertainment segment distributes a schedule of news and public affairs broadcasts, sports, and entertainment programming; produces, acquires, and distributes programming, including series, specials, news, and public affairs; produces and distributes theatrical motion pictures across various genres; and operates online content networks for information and entertainment. Its Cable Networks segment owns and operates multiplexed channels that offers subscription program services, including recently released theatrical feature films, original series, documentaries, boxing, mixed martial arts and other sports-related programming, and special events; and CBS College Sports Network, a 24-hour cable program service related to college sports. This segment also owns and manages Smithsonian Networks, which operates Smithsonian Channel, a basic cab le service in the United States. The company?s Publishing segment publishes and distributes adult and children?s consumer books in printed, audio, and digital formats. Its Local Broadcasting segment owns 29 broadcast television stations; owns and operates 130 radio stations in 28 U.S. markets and related online properties; and owns local Websites that combine television and radio local media brands online to provide the latest news, traffic, weather, and sports information, as well as local discounts, directories, and reviews. The company?s Outdoor segment sells advertising space on various media, including billboards, transit shelters and other street furniture, buses, rail systems, mall kiosks, stadium signage, and in retail stores. CBS Corporation was founded in 1986 and is headquartered in New York, New York. Advisors' Opinion: - [By Matthew Scott]
The price of CBS (NYSE: CBS) stock has increased nearly than eight times in two years, jumping from $2.99 on March 9, 2009 to $25.04 at the end of the first quarter this year. Broadcasting advertising revenues have increased over the last two years and CBS has content choices in multiple genres that will likely be advertising winners for the foreseeable future. CBS Sports continues to be a leader, and the broadcaster has top entries Survivor and Amazing Race in the reality show area, top dramas such as the CSI series and the hot new series Hawaii Five-O, and it even had the top comedy Two and a Half Men before Charlie Sheen imploded. With all these shows expected back next year, ad revenues should continue to be strong. - [By Zachary Silver]
CBS continues to offer high-quality entertainment content. As evidenced by its first-quarter results, both its Showtime and CBS network channel audiences have grown on a year-over-year basis. One cause for concern is the increased competition from Time Warner�� HBO. Additionally, it remains to be seen if nascent content producers such as�Netflix will provide formidable competition for Showtime. Still, CBS is trading at a reasonable price-to-equity ratio, has a manageable debt level, and pays a modest dividend. CBS is probably due for a slight pullback, as it recently set a new 52-week high ��however, it should continue to OUTPERFORM for the rest of the year.
For months, speculation has been growing that Apple (NASDAQ: AAPL ) will introduce a lower-cost iPhone for emerging markets. Apple's growth has tailed off recently, as the U.S. market is starting to become saturated and relatively few people in emerging markets can afford even an iPhone 4 without a carrier subsidy. However, as I wrote back in April, a cheaper iPhone will still be very expensive compared with the legions of Android phones available for $199 or even $99 without a subsidy. If Apple introduces a lower-cost iPhone, $329-$349 seems like a reasonable price range to expect, while analysts at Morgan Stanley think that the unsubsidized price could be as high as $399. Apple may be about to unveil a program that could boost sales in the U.S. and other developed markets while also increasing adoption of the iPhone in developing countries. According to Bloomberg, iPhone owners will be able to trade in iPhone 4 and iPhone 4S devices at their local Apple Store for a credit toward a new phone purchase. The trade-in could potentially cover the full subsidized cost of an iPhone 5, which is $199 at most carriers. Top Cheap Stocks To Watch Right Now: 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. Top Cheap Stocks To Watch Right Now: Cryosite Ltd(CTE.AX) Cryosite Limited provides specialized outsourced logistics services to the research, medical, pharmaceutical, veterinary, and biotechnology industries primarily in Australia. The company offers biological services, including private cord blood, adult stem cell storage, and general biorepository management services. It also provides warehousing and distribution services comprising clinical trial logistics services; and importation and distribution of culture collection and laboratory diagnostics products Cryosite Limited was founded in 1999 and is based in South Granville, Australia. Ross River Minerals Inc., a junior resource company, engages in the acquisition, exploration, and development of gold and copper-gold properties in Canada and Mexico. Its projects include the Tay-LP property that consists of 413 contiguous mineral claims covering 8,600 hectares and is located in the Yukon Territory, Canada; and the El Pulpo property, which covers approximately 20,000 hectares and is located in Sinaloa State, Mexico. The company is headquartered in Vancouver, Canada.
On this day in economic and business history ... The Federal Reserve of the 1980s was known primarily for its role in combating the inflation that had riddled the previous decade. Under the leadership of Chairman Paul Volcker, the Fed pushed inflation rates down from a peak of 15% in early 1980 to a far more moderate rate of approximately 4% by the latter half of the decade. His most important work finished, Volcker unexpectedly resigned on June 2, 1987. That same day, President Reagan announced the selection of a successor whose name would later become synonymous with booming stock markets and asset bubbles: Alan Greenspan. Volcker's resignation shocked the international financial community, according to the Los Angeles Times. The former Fed chairman's aggressive inflation-fighting policies, which became highly unpopular when the U.S. economy fell into a damaging recession in the early '80s, had become widely respected by 1987 as markets soared to new records with nearly every passing day. Greenspan was deferential toward his predecessor, saying that "filling Paul Volcker's shoes will be a major challenge," but promised to serve in the Volcker mold when confirmed to the post. However, the selection of Greenspan, a staunch Republican whose close ties to Ayn Rand's Objectivism were already well known, drew sharp rebukes from politicians across the aisle. One Democratic representative said that "Greenspan is such an ideologue that he will more than likely cave in to ideological pressures." Greenspan sailed to an easy confirmation two months later, beginning his second stint as a public servant since his four-year tenure as the chairman of President Ford's Council of Economic Advisors. He was quickly beset by a major market problem, as two months after his confirmation, the Dow Jones Industrial Average (DJINDICES: ^DJI ) suffered the worst one-day percentage drop in its century-plus history. Immediately after the crash, the Greenspan Fed issued a press release promising to "serve as a source of liquidity to support the economic and financial system." Thus the Greenspan Put was born. This term refers to Greenspan's consistent willingness to backstop the financial system and the stock market -- a "put," for those investors unaware, is an option that grants the buyer the right to sell a certain asset to the seller of the put when values drop below a certain price. Greenspan's loose monetary policy led the Dow to the greatest period of growth since the Roaring '20s. From the day after 1987's Black Monday -- when the Greenspan Put first reassured the investing world that the Fed would always be there for them -- to the peak of the dot-com bubble just over 12 years later, the Dow grew at an annualized rate of 17.2%, a rate approaching the annualized 25% growth of the Roaring '20s from trough to peak. However, Greenspan would later receive intense criticism for his role in inflating both the dot-com bubble and the far more disastrous housing bubble that popped shortly after his retirement in 2006. Nearly three years after his retirement, Greenspan admitted to being in "a state of shocked disbelief" over the market's complete inability to self-correct the egregiously damaging mortgage-lending policies that created a financial crisis. It was the first time Greenspan admitted to finding flaw in his formerly ironclad faith in the unrestrained free market. Greenspan's legacy has thus been damaged -- perhaps irreparably -- by the consequences of his policies. That hasn't stopped his successor, Ben Bernanke, from following a similar path. The current Fed chairman's looser monetary policy has given rise to the notion of a "Bernanke Put," the consequences of which have yet to be fully realized. Something that wasn't born every minute
Phineas Taylor Barnum began his first circus tour of the United States on June 2, 1835. The legendary showman built a career out of the grotesque, absurd, and extravagant, attracting the curiosity of millions to his three-ring circuses over the years. More than four decades later, Barnum combined with Anthony Bailey's circus to form Barnum & Bailey, the predecessor to today's Ringling Bros. and Barnum & Bailey Circus. Barnum is often credited with the phrase "there's a sucker born every minute," which has been spoken more than a few times in the financial industry. Barnum never actually spoke this quote -- it was uttered by a freak-show competitor frustrated by Barnum's ability to continue drawing customers even after a hoax was revealed -- but it certainly is a good expression of a showman's cunning exploitation of the gullible masses, isn't it? Barbarians (soon to be) at the gate
Cigarette maker R.J. Reynolds acquired Nabisco for $4.9 billion on June 2. 1985. The deal would create the largest consumer-products company in America, with combined annual sales of more than $19 billion. It beat the size of other major food-company mergers completed the year earlier, and it also came close to becoming the largest non-energy merger in history up to that time. Nabisco's popular Oreos and Ritz crackers would gain access to a deeper advertising budget flowing from high-margin cigarette sales and would also add depth to R.J. Reynolds' stable of food brands, which already included Del Monte and Kentucky Fried Chicken. R.J. Reynolds financed 49% of the buyout with corporate bond issues, continuing the trend of leveraged buyouts pioneered by junk-bond king Michael Milken. RJR Nabisco would soon fall prey to a far larger leveraged buyout -- four years later, Kohlberg Kravitz Roberts (NYSE: KKR ) spent a record-setting $25 billion to acquire the company, providing post-merger RJR Nabisco shareholders an impressive 50% annualized rate of return. This event was the high-water mark of the leveraged-buyout era, and it occurred shortly after a federal jury indicted Milken on racketeering charges. KKR's buyout of RJR Nabisco later became the subject of the era-defining book (and later TV movie) Barbarians at the Gate. The deal took 16 years for KKR to digest, and RJR Nabisco soon split back into its component parts. Today, R.J. Reynolds has become Reynolds American (NYSE: RAI ) , and Nabisco's brands were shuttled from one tobacco company to another, becoming part of the Kraft food empire before spinning off into the hard-to-pronounce food conglomerate Mondelez International (NASDAQ: MDLZ ) . Nabisco's Oreo was an important part of that spinoff -- it's been the world's most popular cookie for decades. Shares of Mondelez International fell immediately after the company separated from its parent, Kraft. Is this an indictment of the idea, or a buying opportunity today? Our top consumer goods analyst will give you the scoop in our premium research report on Mondelez. Just click here now for instant access. #pitch{ margin-bottom: 15px; } More Expert Advice from The Motley Fool The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.
Today, Adobe (NASDAQ: ADBE ) purchased the San Francisco creative consulting agency, Ideacodes. The company designs and creates user interfaces for smart applications, digital products, and networked communities, according to an Adobe press release. The co-founders of Ideacodes, Emily Chang and Max Kiesler, will join Adobe's Creative Cloud business as creative directors. In a statement, Chang and Kiesler said, "We're thrilled to join Adobe at a time when Creative Cloud is beginning to take form, the potential to harness the power of connected networks is being realized, and the influence of good design on experience is being appreciated and expected from people worldwide." Adobe said in the release that, "The Ideacodes team will help us realize our goal of making Creative Cloud indispensable for creatives worldwide." The Ideacodes acquisition comes just a week after Adobe announced that it was acquiring the developer team from Thumb Labs to create an enhanced mobile experience for Creative Cloud. Adobe has not released further details or a purchase price for the Ideacodes acquisition.
Shares of Stratasys (NASDAQ: SSYS ) closed up nearly 6% Tuesday after jumping as much as 11% earlier in the day after the 3-D printing company posted better than expected first-quarter earnings. Image Source: Stratasys Meanwhile, fellow additive manufacturing specialists 3D Systems (NYSE: DDD ) and ExOne (NASDAQ: XONE ) also came along for the ride yesterday, closing up 4% and almost 10%, respectively. Unfortunately, ExOne itself fell more than 12% in after-hours trading yesterday after missing quarterly earnings expectations, predictably dragging all three companies down with it so far in today's trading. With shares of Stratasys up nearly 30% over the past three months, however, now's a great time to dig in and see if this 3-D printing stock could possibly still be a buy. The numbers
On one hand, Stratasys turned in GAAP revenue of $97.2 million, which actually missed analysts' estimates for sales of $98.4 million on the same basis. Even so, that number still represents a 116% rise from the $45 million in GAAP sales Stratasys achieved during the same year-ago period. Meanwhile, non-GAAP revenue -- which excludes the effect of certain amortization expenses related to the recently closed Objet merger -- came in at $98.2 million. For those of you keeping track, that reflects organic growth of 18%. Of course, that didn't beat the 22.1% organic growth posted by 3D Systems in its most recent quarter, but it's an impressive result nonetheless. Adjusted net income, on the other hand, rose 40% to $17.6 million, or $0.43 per diluted share, handily beating analysts' expectations for earnings of $0.37 per share. In addition, and once again thanks largely to costs associated with the merger, Stratasys' GAAP loss per share increased to $0.40 from a loss of $0.23 during the first quarter last year. Going forward, management reiterated previous full-year 2013 guidance, telling investors that they still expect revenue to come in between $430 million and $445 million, with non-GAAP earnings per share between $1.80 and $1.90. Finally, Stratasys' GAAP loss per share is still expected to be somewhere between $0.41 and $0.16. So why buy?
Let's get this straight: While Stratasys managed to beat estimates for net income, it missed on revenue and still projects a GAAP loss per share when all is said and done in 2013. Why, again, does Mr. Market believe the stock is worth paying more than 250 times trailing earnings? Well, as my Foolish colleague Brian Pacampara pointed out yesterday, Stratasys' forward P/E is still rich, but much more palatable at 40. And remember, for better or worse, the stock market is generally a forward-looking machine. And while the market isn't always perfectly efficient, it's important to note Stratasys' GAAP losses won't last forever. More specifically, until all those merger-related integration expenses inevitably pass, Stratasys' sky-high trailing price to earnings ratio won't be a useful valuation metric -- hence the focus on non-GAAP earnings to give investors a better idea of how the company is really doing absent those costs. In addition, thanks to the merger, remember I previously wrote the folks at Stratasys were looking forward to leveraging their new "global network of more than 260 resellers and independent sales agents that sell Stratasys products and services worldwide." Sure enough, according to the company's earnings press release, they've already finished training the most significant 112 of those channel partners, "representing approximately 80% of the Company's potential worldwide revenue." What's more, Stratasys spent $10.8 million on R&D last quarter, or around 11% of sales, which reassured investors that the high-tech company isn't resting on its laurels. Finally, on another interesting note, Stratasys also launched the first 3-D printer "designed especially for smaller orthodontic labs and clinics", the Objet30 OrthoDesk. In fact, Stratasys is using the relatively compact printer to make a huge push to revolutionize the world of digital orthodontics: Of course, this is only one niche market in which Stratasys is involved, but it perfectly illustrates why management felt confident in the earnings conference call saying that their long-term target operating model includes maintaining annual revenue growth of at least 20%, with non-GAAP net income as a percentage of sales between 16% and 21%. When you consider recent analysis from Lux Research indicates the 3-D printing industry should be able to grow nearly tenfold to $8.4 billion over the next 12 years, those goals certainly seem within the realm of possibility and show that there's plenty of money to be made in 3-D printing. As a result, market leaders like Stratasys and 3D Systems alike should be have plenty of room to peacefully coexist, all while continuing to handsomely reward patient long-term shareholders in the process. More expert advice from The Motley Fool
3D Systems is at the leading edge of a disruptive technological revolution, with the broadest portfolio of 3-D printers in the industry. However, despite years of earnings growth, 3D Systems' share price has risen even faster, and today the company sports a dizzying valuation. To help investors decide whether the future of additive manufacturing is bright enough to justify the lofty price tag on the company's shares, The Motley Fool has compiled a premium research report on whether 3D Systems is a buy right now. In our report, we take a close look at 3D Systems' opportunities, risks, and critical factors for growth. You'll also find reasons to buy or sell the stock today. To start reading, simply click here now for instant access. #pitch{ display: none; } More Expert Advice from The Motley Fool The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.
Monday was busy for Barclays (NYSE: BCS ) . The U.K. makes all kinds of fun demands, and it recently came to light that one of those demands was for much, much more capital than Barclays currently has on hand. When I say "more," I of course mean ę¢7 billion more. Yesterday, the bank announced that it would be looking to raise the capital through a new share offering, and today it announced that that offering would be for ę¢5.8 billion.� Yesterday, the bank was also named in a lawsuit being brought against LIBOR-setting banks by the city of Philadelphia. The city is suing based on the premise that the LIBOR was manipulated by the banks in such a way that hedging instruments that the city used were turned in the banks' favor.� Barclays also found out that the U.K. may have finally hit the peak for claims against banks based on misselling of payment protection insurance (PPI), a scandal that has caused U.K. banks to set aside ę¢14 billion for potential damages. Barclays has reportedly set aside ę¢2.6 billion, which isn't helping that capital ratio.� Top 5 Insurance Stocks To Invest In 2014: The Travelers Companies Inc.(TRV) The Travelers Companies, Inc., through its subsidiaries, provides various commercial and personal property and casualty insurance products and services to businesses, government units, associations, and individuals primarily in the United States. The company operates in three segments: Business Insurance; Financial, Professional, and International Insurance; and Personal Insurance. The Business Insurance segment offers property and casualty products and services, such as commercial multi-peril, property, general liability, commercial auto, and workers? compensation insurance. It operates in six groups: Select Accounts, which serves small businesses; Commercial Accounts that serves mid-sized businesses; National Accounts, which serves large companies; Industry-Focused Underwriting that serves targeted industries; Target Risk Underwriting, which serves commercial businesses requiring specialized product underwriting, claims handling, and risk management services; and Special ized Distribution that offers products to customers through licensed wholesale, general, and program agents. The Financial, Professional, and International Insurance segment provides surety and financial liability coverage, which uses a credit-based underwriting process; and property and casualty products primarily in the United States., the United Kingdom, Ireland, and Canada. The Personal Insurance segment offers property and casualty insurance covering personal risks, primarily automobile and homeowners insurance to individuals. It distributes its products through independent agents, sponsoring organizations, joint marketing arrangements with other insurers, and direct marketing. The company was founded in 1853 and is based in New York, New York. Advisors' Opinion: - [By Jon C. Ogg]
The Travelers Companies Inc. (NYSE: TRV) is expected to rise by only 7.6% to $77.26 in 2013. That would represent a 52-week high but this one also has a yield of 2.6%. We would note that the street high target is actually all the way up at $87.00 and shares are currently very close to all-time highs. This insurance provider and financial services giant is not tied into healthcare so it has been immune to some of the ongoing risks. Travelers held up rather well in the recession but many investors do not even know it i one of the 30 DJIA components.
- [By Jim Cramer]
This insurer never ran into trouble like so many of its cohorts and yet somehow hasn't received the kudos its management deserves for steering the ship through the shoals of bad investments. Jay Fishman, the CEO, is easily the best executive in the insurance industry and Travelers will get its due in 2011, which will make it so that its 12% return in 2010 will seem quite small. I think it can trade to $68 and not be expensive, particularly when people begin to give the well-run insurers a nice premium to the ne'er-do-wells. - [By Vodicka]
Shares are trading around $51.50 at the time of writing, as against their 52-week trading range of $45.97 to $64.17. At the current market price, the company is capitalized at $21.64 billion. Earnings per share for the last year were $5.29, placing the shares on a price to earnings ratio of 9.77. It paid a dividend of $1.64 (a yield of 3.20%). Still in the memory is the financial crisis of 2008, and the mess that insurance companies like AIG managed to get themselves into. Travelers avoided that, but investors are fickle creatures and sometimes look at the short term rather than the long term. Travelers are well managed with good prospects going forward. Operating margins of nearly 13% hold well against rivals Hartford Financial Services Group (HIG) at around 10% and W.R. Berkley Corporation (WRB) at a shade under 14%. Good management should keep gross margins healthy (currently 26.5% versus Hartford’s 30% and W.R. Berkely’s 18%), and the company’s ongoing policy of share repurchases and dividend payout should continue to add value to shareholders. A good buy.
Top 5 Insurance Stocks To Invest In 2014: Citizens Inc (CIA) Citizens, Inc. (Citizens), incorporated on November 8, 1977, is an insurance holding company serving the life insurance needs of individuals in the United States. The Company operates in three segments: Life Insurance, Home Service and Other Non-insurance Enterprises. Its core insurance operations include issuing and servicing the United States Dollar-denominated ordinary whole life insurance and endowment policies predominantly to high net worth, high income foreign residents, principally in Latin America and the Pacific Rim, through independent marketing consultants; ordinary whole life insurance policies to middle income households concentrated in the midwest and southern United States through independent marketing consultants, and final expense and limited liability property policies to middle and lower income households in Louisiana, Arkansas, and Mississippi through employee and independent agents in its home service distribution channel. Life Insurance The Company�� Life Insurance segment issues ordinary whole life insurance domestically and in United States Dollar-denominated amounts to foreign residents. These contracts are designed to provide a fixed amount of insurance coverage over the life of the insured. Additionally, endowment contracts are issued by the Company, which are principally accumulation contracts that incorporate an element of life insurance protection. The Company operates the segment through its subsidiaries: CICA Life Insurance Company of America (CICA) and Citizens National Life Insurance Company (CNLIC). The Company offers several ordinary whole life insurance and endowment products designed to meet the needs of its non-United States policy owners. Its domestic life insurance products focus primarily on living needs and provide benefits focused toward accumulating money for the policyowner. The Company�� life insurance products are principally designed to address the insured�� concern about outliving his or her monthly income,! while at the same time providing death benefits. The primary purpose of its product portfolio is to help the insured create capital for needs, such as retirement income, children's higher education funds, business opportunities, emergencies and health care needs. Home Service Insurance The Company operates in the Home Service market through its subsidiaries Security Plan Life Insurance Company (SPLIC) and Security Plan Fire Insurance Company (SPFIC), and focus on the life insurance needs of the middle and lower income markets, primarily in Louisiana, Mississippi and Arkansas. Its home service insurance products consist primarily of small face amount ordinary whole life and pre-need policies, which are designed to fund final expenses for the insured, primarily consisting of funeral and burial costs. Other Non-Insurance Enterprises Other Non-insurance Enterprises includes Computing Technology, Inc., which provides data processing services to the Company, and Insurance Investors, Inc., which provides aviation transportation to the Company. This segment also includes the results of Citizens, Inc., the parent Company. Aflac Incorporated, through its subsidiary, American Family Life Assurance Company of Columbus (Aflac), provides supplemental health and life insurance. The company offers various voluntary supplemental insurance products, including cancer plans, general medical indemnity plans, medical/sickness riders, care plans, living benefit life plans, ordinary life insurance plans, and annuities in Japan. It also provides loss-of-income products, such as life and short-term disability plans; and products designed to protect individuals from depletion of assets, which comprise hospital indemnity, fixed-benefit dental, vision care, accident, cancer, critical illness/critical care, and hospital intensive care plans in the United States. The company sells its products through sales associates and brokers, affiliated corporate agencies, independent corporate agencies, and individual agencies. Aflac Incorporated was founded in 1955 and is headquartered in Columbus, Georgia. Advisors' Opinion: - [By Vita]
AFLAC Inc. (NYSE:AFL): Down 1.75% to $31.46. Aflac, Inc. is a general business holding company. The Company, through its subsidiaries, provides supplemental insurance to individuals in the United States and Japan. Aflac’s products include accident/disability plans, cancer expense plans, short-term disability plans, sickness and hospital indemnity plans, hospital intensive care plans, and fixed-benefit dental plans. - [By Martin]
David Gary Thompson, who is a Director at AFLAC Inc. (NYSE:AFL), bought 5,000 shares on Sep 26 at $31.50 per share for a total value of $157,500. About the company: Aflac, Inc. is a general business holding company. The Company, through its subsidiaries, provides supplemental insurance to individuals in the United States and Japan. Aflac’s products include accident/disability plans, cancer expense plans, short-term disability plans, sickness and hospital indemnity plans, hospital intensive care plans, and fixed-benefit dental plans.
Top 5 Insurance Stocks To Invest In 2014: W.R. Berkley Corporation(WRB) W. R. Berkley Corporation, an insurance holding company, operates as commercial lines writers in the property casualty insurance business primarily in the United States. The company operates in five segments: Specialty, Regional, Alternative Markets, Reinsurance, and International. The Specialty segment underwrites third-party liability risks, primarily excess, and surplus lines, including premises operations, professional liability, commercial automobile, products liability, and property lines. The Regional segments provide commercial insurance products to small-to-mid-sized businesses, and state and local governmental entities primarily in the 45 states of the United States. The Alternative Markets segment develops, insures, reinsures, and administers self-insurance programs and other alternative risk transfer mechanisms. This segment offers its services to employers, employer groups, insurers, and alternative market funds, as well as provides a range of fee-based servic es, including consulting and administrative services. The Reinsurance segment engages in the underwriting property casualty reinsurance on a treaty and a facultative basis, including individual certificates and program facultative business; and specialty and standard reinsurance lines, and property and casualty reinsurance. The International segment offers personal and commercial property casualty insurance in South America; commercial property casualty insurance in the United Kingdom and continental Europe; and reinsurance in Australia, Southeast Asia, and Canada. The company was founded in 1967 and is based in Greenwich, Connecticut. Top 5 Insurance Stocks To Invest In 2014: Berkshire Hathaway Inc (BRKB) Berkshire Hathaway Inc. (Berkshire), incorporated on June 16, 1998, is a holding company owning subsidiaries engaged in a number of diverse business activities. The Company is engaged in the insurance businesses conducted on both a primary basis and a reinsurance basis, a freight rail transportation business and a group of utility, and energy generation and distribution businesses. Berkshire also owns and operates a number of other businesses engaged in a variety of activities. In October 2012, HomeServices acquired a 66.7% interest in the residential real estate brokerage franchise network in the United States. In May 2013, Berkshire acquired the remaining 20% stake in IMC International Metalworking Companies BV. Insurance and Reinsurance Businesses Berkshire�� insurance and reinsurance business activities are conducted through numerous domestic and foreign-based insurance entities. Berkshire�� insurance businesses provide insurance and reinsurance of property and casualty risks worldwide and also reinsure life, accident and health risks worldwide. The Company�� insurance underwriting operations are consisted of the sub-groups, including GEICO and its subsidiaries, General Re and its subsidiaries, Berkshire Hathaway Reinsurance Group and Berkshire Hathaway Primary Group. GEICO insurance subsidiaries include Government Employees Insurance Company, GEICO General Insurance Company, GEICO Indemnity Company, GEICO Casualty Company, GEICO Advantage Insurance Company, GEICO Choice Insurance Company and GEICO Secure Insurance Company. These companies primarily offers private passenger automobile insurance to individuals in all 50 states and the District of Columbia. In addition, GEICO insures motorcycles, all-terrain vehicles, recreational vehicles and small commercial fleets and acts as an agent for other insurers who offer homeowners, boat and life insurance to individuals. GEICO markets its policies primarily through direct response methods in which applications for insura! nce are submitted directly to the companies via the Internet or by telephone. General Re Corporation (General Re) is the holding company of General Reinsurance Corporation (GRC) and its subsidiaries and affiliates. GRC�� subsidiaries include General Reinsurance AG, an international reinsurer based in Germany. General Re subsidiaries conduct business activities globally in 51 cities and provide insurance and reinsurance coverages throughout the world. General Re provides property/casualty insurance and reinsurance, life/health reinsurance and other reinsurance intermediary and risk management, underwriting management and investment management services. Property/Casualty Reinsurance General Re�� property/casualty reinsurance business in North America is conducted through GRC. Property/casualty operations in North America are also conducted through 16 branch offices in the United States and Canada. Reinsurance activities are marketed directly to clients without involving a broker or intermediary. General Re�� property/casualty business in North America also includes specialty insurers (primarily the General Star and Genesis companies). These specialty insurers underwrite primarily liability and workers��compensation coverages on an excess and surplus basis and excess insurance for self-insured programs. General Re�� international property/casualty reinsurance business operations are conducted through internationally-based subsidiaries on a direct basis (through General Reinsurance AG, as well as several other General Re subsidiaries in 23 countries) and through brokers (primarily through Faraday, which owns the managing agent of Syndicate 435 at Lloyd�� of London and provides capacity and participates in 100% of the results of Syndicate 435). Life/Health Reinsurance General Re�� North American and international life, health, long-term care and disability reinsurance coverages are written on an individual and group basis. Most! of this ! business is written on a proportional treaty basis, with the exception of the United States group health and disability business, which is predominately written on an excess treaty basis. Lesser amounts of life and disability business are written on a facultative basis. The life/health business is marketed on a direct basis. The Berkshire Hathaway Reinsurance Group (BHRG) operates from offices located in Stamford, Connecticut. Business activities are conducted through a group of subsidiary companies, led by National Indemnity Company (NICO) and Columbia Insurance Company (Columbia). BHRG provides principally excess and quota-share reinsurance to other property and casualty insurers and reinsurers. BHRG�� underwriting activities also include life reinsurance and life annuity business written through Berkshire Hathaway Life Insurance Company of Nebraska and financial guaranty insurance written through Berkshire Hathaway Assurance Corporation. BHRG writes catastrophe excess-of-loss treaty reinsurance contracts. BHRG also writes individual policies for primarily large or otherwise unusual discrete risks on both an excess direct and facultative reinsurance basis, referred to as individual risk, which includes policies covering terrorism, natural catastrophe and aviation risks. A catastrophe excess policy provides protection to the counterparty from the accumulation of primarily property losses arising from a single loss event or series of related events. Catastrophe and individual risk policies may provide amounts of indemnification per contract and a single loss event may produce losses under a number of contracts. BHRG also underwrites traditional non-catastrophe insurance and reinsurance coverages, referred to as multi-line property/casualty business. The Berkshire Hathaway Primary Group is a collection of primary insurance operations that provide a range of insurance coverages to insureds located principally in the United States. NICO and certain affiliates underw! rite moto! r vehicle and general liability insurance to commercial enterprises on both an admitted and excess and surplus basis. This business is written nationwide primarily through insurance agents and brokers and is based in Omaha, Nebraska. U.S. Investment Corporation (USIC), through its four subsidiaries led by United States Liability Insurance Company, is a specialty insurer that underwrites commercial, professional and personal lines of insurance on an admitted and excess and surplus basis. Policies are marketed in all 50 states and the District of Columbia through wholesale and retail insurance agents. USIC companies underwrite and market 110 distinct specialty property and casualty insurance products. Medical Protective Corporation (MedPro) is based in Fort Wayne, Indiana. MedPro offers products and solutions through its subsidiaries, The Medical Protective Company and Princeton Insurance Company and is a primary healthcare malpractice insurance coverage and patient safety solutions to physicians, dentists, other healthcare providers and healthcare facilities. Other insurance operations include the Berkshire Hathaway Homestate Companies (BHHC), a group of six insurance companies that primarily offers standalone workers��compensation, commercial auto and commercial property coverages. Railroad Business Through Burlington Northern Santa Fe, LLC (BNSF) Railway, BNSF operates a railroad network in North America with approximately BNSF operates a railroad network in North America with approximately 32,500 route miles of track (excluding multiple main tracks, yard tracks and sidings) in 28 states and two Canadian provinces as of December 31, 2012. BNSF owns approximately 23,000 route miles, including easements, and operates on approximately 9,500 route miles of trackage rights that permit BNSF to operate its trains with its crews over other railroads��tracks. As of December 31, 2012, the total BNSF Railway system, including single and multiple main tracks, yard tracks and sidings,! consiste! d of approximately 50,500 operated miles of track, all of which are owned by or held under easement by BNSF except for approximately 10,500 miles operated under trackage rights. BNSF is based in Fort Worth, Texas, and through BNSF Railway Company operates railroad systems in North America. In serving the Midwest, Pacific Northwest, Western, Southwestern and Southeastern regions and ports of the country, BNSF transports a range of products and commodities derived from manufacturing, agricultural and natural resource industries. Over half of the freight revenues of BNSF are covered by contractual agreements of varying durations. BNSF�� primary routes, including trackage rights, allow it to access major cities and ports in the western and southern United States, as well as parts of Canada and Mexico. Utilities and Energy Businesses MidAmerican�� businesses are managed as separate operating units. MidAmerican�� domestic regulated energy interests are consisted of two regulated utility companies serving more than three million retail customers, two interstate natural gas pipeline companies with approximately 16,600 miles of pipeline and a design capacity of approximately 7.7 billion cubic feet of natural gas per day and a 50% interest in electric transmission businesses. Its Great Britain electricity distribution subsidiaries serve about 3.9 million electricity end-users. In addition, MidAmerican�� interests include a diversified portfolio of domestic independent power projects, a hydroelectric facility in the Philippines, the residential real estate brokerage firm in the United States and the residential real estate brokerage franchise network in the United States. PacifiCorp is a regulated electric utility company, serving regulated retail electric customers in portions of Utah, Oregon, Wyoming, Washington, Idaho and California. The combined service territory�� diverse regional economy ranges from rural, agricultural and mining areas to urban,! manufact! uring and government service centers. As a vertically integrated electric utility, PacifiCorp owns approximately 10,600 net megawatts (MW) of generation capacity. MidAmerican Energy Company (MEC) is a regulated electric and natural gas utility company, serving regulated retail electric and natural gas customers primarily in Iowa and also in portions of Illinois, South Dakota and Nebraska. MEC has a diverse customer base consisting of urban and rural residential customers and a range of commercial and industrial customers. In addition to retail sales and natural gas transportation, MEC sells regulated electricity principally to markets operated by regional transmission organizations and regulated natural gas to other utilities and market participants on a wholesale basis and sells non-regulated electricity and natural gas services in deregulated markets. As a vertically integrated electric and gas utility, MEC owns approximately 7,400 net megawatts of generation capacity. The natural gas pipelines consist of Northern Natural Gas Company (Northern Natural) and Kern River Gas Transmission Company (Kern River). Northern Natural is based in Nebraska and owns interstate natural gas pipeline system in the United States reaching from southern Texas to Michigan�� Upper Peninsula. Northern Natural�� pipeline system consists of approximately 14,900 miles of natural gas pipelines. Northern Natural also operates three underground natural gas storage facilities and two liquefied natural gas storage peaking units. Kern River is based in Utah and owns an interstate natural gas pipeline system that consists of approximately 1,700 miles and extends from supply areas in the Rocky Mountains to consuming markets in Utah, Nevada and California. Kern River transports natural gas for electric utilities and natural gas distribution utilities, major oil and natural gas companies or affiliates of such companies, electricity generating companies, energy marketing and trading companies, a! nd financ! ial institutions. The Great Britain utilities consist of Northern Powergrid (Northeast) Limited (Northern Powergrid (Northeast)) and Northern Powergrid (Yorkshire) plc (Northern Powergrid (Yorkshire)), which own a substantial Great Britain electricity distribution network that delivers electricity to end-users in northeast England in an area covering approximately 10,000 square miles. The distribution companies primarily charge supply companies regulated tariffs for the use of electrical infrastructure. MidAmerican also owns HomeServices of America, Inc. (HomeServices), a full-service residential real estate brokerage firm in the United States. HomeServices offers integrated real estate services, including mortgage originations and mortgage banking primarily through joint ventures, title and closing services, property and casualty insurance, home warranties, relocation services and other home-related services. It operates under 27 residential real estate brand names with over 16,000 sales agents and in nearly 375 brokerage offices in 21 states. Manufacturing, Service and Retailing Businesses Berkshire�� numerous and diverse manufacturing, service and retailing businesses. Marmon Holdings, Inc. (Marmon) consists of approximately 140 manufacturing and service businesses that operate independently within 11 diverse business sectors. These sectors are distribution services, electrical and plumbing products, industrial products, crane services, engineered wire and cable, transportation services and engineered products, food service equipment, highway technologies, retail home improvement products, retail store fixtures, and water treatment. Distribution Services supplies specialty metal pipe and tubing, bar and sheet products to markets, including construction, industrial, aerospace and many others. Electrical and Plumbing Products is engaged in the distribution, supplying electrical building wire primarily for residential and commercial construction, and copper tube for th! e plumbin! g, heating, ventilation, and air conditioning (HVAC), refrigeration and industrial markets, through the wholesale channel. Industrial Products consists of metal fasteners and fastener coatings for the construction, industrial and other markets, gloves for industrial markets, portable lighting equipment for mining and safety markets, overhead electrification equipment for mass transit systems, custom-machined aluminum and brass forgings for the construction, energy, recreation and other industries, brass fittings and valves for commercial and industrial applications, and drawn aluminum tubing and extruded aluminum shapes for the construction, automotive, appliance, medical and other markets. Crane Services is engaged in providing the leasing and operation of mobile cranes primarily to the energy, mining and petrochemical markets. Engineered Wire and Cable is engaged in supplying electrical and electronic wire and cable for energy related markets and other industries. Transportation Services and Engineered Products includes manufacturing, leasing and maintenance of railroad tank cars, leasing of intermodal tank containers, in-plant rail services, manufacturing of bi-modal railcar movers, wheel, axle and gear sets for light rail transit and gear products for locomotives, manufacturing of steel tank heads, and services, equipment and technology for processing and distributing sulfur. Food Service Equipment is engaged in supplying commercial food preparation equipment for restaurants and shopping carts for retail stores. Highway Technologies primarily serve the heavy-duty highway transportation industry with trailers, fifth wheel coupling devices and undercarriage products, such as brake parts and suspension systems, and also serving the light vehicle aftermarket with clutches and related products. Retail Home Improvement Products is engaged in supplying electrical and plumbing products through the home center channel. Retail Store Fixtures provides shelving systems, other merchandising di! splays an! d related services for retail stores, as well as work and garden gloves sold at retail. Water Treatment includes residential water softening, purification and refrigeration filtration systems, treatment systems for industrial markets including power generation, oil and gas, chemical, and pulp and paper, gear drives for irrigation systems and cooling towers, and air-cooled heat exchangers. McLane Company, Inc. (McLane) provides wholesale distribution and logistics services in all 50 states and internationally in Brazil to customers that include convenience stores, discount retailers, wholesale clubs, drug stores, military bases, quick service restaurants and casual dining restaurants. Operations include grocery distribution, foodservice distribution, beverage distribution, international logistics and software development. McLane�� foodservice distribution unit, based in Carrollton, Texas, focuses on serving the quick service restaurant industry. Operations are conducted through 18 facilities in 16 states. The foodservice distribution unit services more than 19,000 chain restaurants nationwide. Other Manufacturing, Other Service and Retailing Businesses Berkshire�� apparel manufacturing businesses include manufacturers of a range of clothing and footwear. Businesses engaged in the manufacture and distribution of clothing products include Fruit of the Loom, Inc. (Fruit), Russell Brands, LLC (Russell), Vanity Fair Brands, LP (VFB), Garan and Fechheimer Brothers. Berkshire�� footwear businesses include H.H. Brown Shoe Group, Justin Brands and Brooks Sports. Fruit, Russell and VFB (together FOL) is primarily a vertically integrated manufacturer and distributor of basic apparel, underwear and athletic apparel and products. Products, under the Fruit of the Loom and JERZEES labels are primarily sold in the mass merchandise and wholesale markets. In the VFB product line, Vassarette, Bestform and Curvation are sold in the mass merchandise market, while Vanity Fair and! Lily of ! France products are sold in the mid-tier chains and department stores. FOL also markets and sells athletic uniforms, apparel, sports equipment and balls to team dealers; college licensed tee shirts and fleecewear to college bookstores and mid-tier merchants; and athletic apparel, sports equipment and balls to sporting goods retailers under the Russell Athletic and Spalding brands. Additionally, Spalding markets and sells balls in the mass merchandise market and dollar store channels. Garan designs, manufactures, imports and sells apparel primarily for children, including boys, girls, toddlers and infants. Products are sold under its own trademark Garanimals and private labels of its customers. Garan also licenses its registered trademark Garanimals to independent third parties. Garan conducts its business through operating subsidiaries located in the United States, Central America and Asia. Fechheimer Brothers manufactures, distributes and sells uniforms, principally for the public service and safety markets, including police, fire, postal and military markets. Fechheimer Brothers is based in Cincinnati, Ohio. Justin Brands and H.H. Brown Shoe Group manufacture and distribute work, rugged outdoor and casual shoes and western-style footwear under a number of brand names, including Justin, Tony Lama, Nocona, Chippewa, Carolina, Sofft, Double-H Boots, Eurosoft, and Softspots. Acme Building Brands (Acme) manufactures and distributes clay bricks (Acme Brick and Jenkins Brick), concrete block (Featherlite) and cut limestone (Texas Quarries). In addition, Acme distributes a range of other building products of other manufacturers, including glass block, floor and wall tile, wood flooring and other masonry products. Acme also sells ceramic floor and wall tile, as well as marble, granite and other stones through its subsidiary, American Tile and Stone. Benjamin Moore & Co. (Benjamin Moore) is a formulator, manufacturer and retailer of a range of architectural coatings, available principa! lly in th! e United States and Canada. Products include water-thinnable and solvent-thinnable general purpose coatings (paints, stains and clear finishes) for use by the general public, contractors and industrial and commercial users. Products are marketed under various registered brand names, including Regal, Super Spec, MoorGard, Aura, Nattura, ben, Coronado, Insl-x and Lenmar. Johns Manville (JM) is a manufacturer and marketer of products for building insulation, mechanical insulation, commercial roofing and roof insulation, as well as fibers and nonwovens for commercial, industrial and residential applications. JM serves markets that include aerospace, automotive and transportation, air handling, appliance, HVAC, pipe insulation, filtration, waterproofing, building, flooring, interiors and wind energy. The Shaw Industries Group, Inc. (Shaw) is a carpet manufacturer based on both revenue and volume of production. Shaw designs and manufactures over 3,000 styles of tufted carpet, tufted and woven rugs, laminate and wood flooring for residential and commercial use under about 30 brand and trade names and under certain private labels. Shaw also provides installation services and sells ceramic and vinyl tile along with sheet vinyl. Forest River, Inc. (Forest River) is a manufacturer of recreational vehicles, utility, cargo and office trailers, buses and pontoon boats. Albecca Inc. (Albecca) does business primarily under the Larson-Juhl name. Albecca designs, manufactures and distributes a range of products, including wood and metal molding, matboard, foamboard, glass, equipment and other framing supplies in the United States, Canada and 15 countries outside of North America. FlightSafety International Inc. (FSI) is engaged in professional aviation training services to individuals, businesses (including certain commercial aviation companies) and the United States. Government. FSI primarily provides training to pilots, aircraft maintenance technicians, flight attendants and dispatchers who op! erate and! support a range of business, commercial and military aircraft. NetJets Inc. (NJ) is a provider of fractional ownership programs for general aviation aircraft. TTI, Inc. (TTI) is a specialty distributor of passive, interconnect, electromechanical and discrete components used by customers in the manufacturing and assembling of electronic products. TTI�� customer base includes original equipment manufacturers, electronic manufacturing services, original design manufacturers, military and commercial customers, as well as design and system engineers. TTI services a range of industries, including telecommunications, medical devices, computers and office equipment, aerospace, automotive and consumer electronics. Finance and Financial Products The Company�� finance and financial products businesses include manufactured housing and finance (Clayton Homes), transportation equipment leasing (XTRA), furniture leasing (CORT), as well as various miscellaneous financing activities. Clayton Homes, Inc. (Clayton) is a vertically integrated manufactured housing company. As of December 31, 2012, Clayton operated 34 manufacturing plants in 12 states. Clayton�� homes are marketed in 48 states through a network of 1,441 retailers, including 323 company-owned home centers. XTRA is a transportation equipment lessor operating under the XTRA Lease brand name. XTRA manages a diverse fleet of approximately 82,000 units located at 58 facilities throughout the United States and two facilities in Canada. The fleet includes over-the-road and storage trailers, chassis, temperature controlled vans and flatbed trailers. CORT Business Services Corporation is a provider of rental relocation services, including rental furniture, accessories and related services in the rent-to-rent segment of the furniture rental industry. Advisors' Opinion: - [By Tiernan Ray]
Berkshire Hathaway�(BRKB) this afternoon reported Q2 operating earnings per Class-A share of $2,384, up 6% from the year-earlier period, and topping a consensus for $2,163 according to FactSet. The company’s book value per share rose 7.6% from the beginning of the year to $122,900. The company saw a $322 million gain on investments, better than the prior-year’s $81 million gain, and a $300 million gain on derivatives, versus a year-earlier $693 million loss. Total revenue for the company from all its holdings was up 16% at $44.69 billion. Total assets rose to $446.56 billion from $427.45 billion a year earlier. The full federal filing for the quarter is available on the company’s Web site. In the filing,�Warren Buffett and his team outlined gains in the underwriting business, railroads, and energy, with a “mixed” bag of results for manufacturing, services and retail: Our insurance businesses generated significant underwriting gains in the first six months of 2013 and 2012. Our railroad and utilities and energy businesses continued to generate significant earnings in 2013. Earnings from our manufacturing, service and retailing businesses in 2013 were mixed, but as indicated in the table above earnings from these businesses increased about 4.8% during the second quarter and 7.4% during the first six months [...] Premiums written [by Geico] in the second quarter and first six months of 2013 were $4,548 million and $9,389 million, respectively, representing increases of 11.7% and 11.5%, respectively, compared to the corresponding 2012 periods. Premiums earned in the second quarter and first six months of 2013 increased $465 million (11.3%) and $848 million (10.4%), respectively, compared to premiums earned in the corresponding 2012 periods. The growth in premiums earned for voluntary auto was 10.4%, reflecting an increase in policies-in-force of 8.2% over the past year, and to a lesser degree, higher average premiums per policy. The increase in policies-in-force reflects a 16.6% increase in voluntary auto new business sales. Voluntary auto policies-in-force at June 30, 2013 [...] Property/casualty premiums earned [by General Re] in the second quarter and first six months of 2013 increased $33 million (4.7%) and $56 million (3.9%), respectively, versus the corresponding 2012 periods. were approximately 587,000 greater than at December 31, 2012 [...][Burlington Northern Santa Fe railroad] Revenues during the second quarter and first six months of 2013 were approximately $5.3 billion and $10.6 billion, respectively, representing increases of $260 million (5%) and $542 million (5%), respectively, over 2012. The overall year-to-date increase in revenues reflected a 3% increase in cars/units handled and a 2% increase in average revenue per car/unit, attributable to rates and business mix. In the second quarter and first six months of 2013, BNSF generated higher revenues fro! m industrial products, consumer products and coal, partially offset by lower revenues from agricultural products [...] PacifiCorp�� revenues in the second quarter and first six months of 2013 increased $63 million (5%) and $103 million (4%), respectively, over revenues in the same periods of 2012. The comparative increases were primarily due to higher retail revenues of $72 million for the second quarter and $149 million for the first six months, partially offset by a decrease in wholesale and other revenues [...] MEC�� revenues in the second quarter and first six months of 2013 increased $53 million (7%) and $103 million (6%), respectively, compared to 2012. The overall increase in revenues was mainly attributable to higher regulated electric and natural gas revenues, partially offset by lower nonregulated and other revenues. In 2013, regulated retail electric operating revenues increased $7 million for the second quarter and $42 million for the first six months. The increase in revenues for the first six months was primarily due to rate adjustment clauses in Iowa and Illinois, and, to a lesser degree, to an increase in customer load. In the second quarter and first six months of 2013, regulated natural gas revenues increased $51 million and $103 million, compared to 2012, due to higher volumes and increases in recoveries through adjustment clauses as a result of a higher average per-unit cost of gas sold [...] Engineered Components��second quarter and first half 2013 revenues were $614 million and $1,208 million, respectively, which represented declines of $30 million (5%) and $84 million (6%), respectively, as compared to 2012. The revenue declines were primarily due to reductions in volume and steel pricing in Distribution Services and lower copper prices in Electrical & Plumbing Products [...] Natural Resources��revenues were $653 million and $1,265 million, in the second quarter and first half of 2013, respectively, which represented declines of $29 million (4%) and $51 million (4%), r! espective! ly, compared to the second quarter and first six months of 2012. These declines reflected lower external tank car sales and unusually large prior year projects in the Transportation Services & Engineered Products and the Engineered Wire & Cable sectors, partially offset by an increase in leasing revenue attributable to higher lease rates and new tank car fleet additions. Berkshire B shares ended the day at $117.82 and were up another 68 cents, or 0.6%, at $118.50, in late trading. The Class A stock (BRKA) closed at $176,500 and were up another $250.04 at $176,750 after hours.
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