Rajiv Gandhi Equity Saving Scheme: Is it worth investing?

Basically the scheme has many restrictions and a huge filter. Some of the restrictions are only first time investors and investors with taxable income of less than Rs 10 lakh can participate. There is also one year blanket lock-in, and an overall lock-in of three years, so it is not liquid, says Rego.

The maximum investment allowed is Rs 50,000 and the investor gets a tax rebate that is 50% deduction of the amount invested, this one of the plus point of the scheme, asserts Rego.

Below is the edited transcript of his interview on CNBC-TV18

Q: Can you just take us through the benefits, the pros and cons of the Rajiv Gandhi Equity Saving Scheme, especially for a first time retail investor considering it entails one a lock-in period as well as, as the fact that it can only be claimed once?

A: Let me give you a quick brief of what the scheme actually is. First, it is restricted only to first time equity investors with taxable income less than Rs 10 lakhs, so that itself is a huge negative and so for those who have invested even once in the past, it is not applicable.

Second, is that it is completely equity scheme for first time investors, so one needs to be a little wary about it. The scheme allows investments only in largecap type of stocks, CNX 100 etc

Third, in terms of lock-in there is one year blanket lock-in and an overall lock-in of three years. It is not very liquid. But on the plus side, a new investor gets a deduction of 50 percent of the Rs 50,000, which is the maximum investment allowed. Depending on the 10 percent or 20 percent tax bracket you are in, accordingly you will save tax.

Q: How is this first time investor check made? It would be for those who have a pan number and therefore you detect even if you have a mutual fund investment, would it be counted as not a first time retail investor. I am wondering how many will really hear of it and come because of this huge filter?

A: It is a very huge filter and so the depositary participant is given the responsibility of checking it out. They will check it out from the pan number and they will also ensure lock-in through depositary participant as well. That is how it is but thanks to a lot of the automation that has happened.

Q: What you are saying is the potential candidates will not have a DP account at all?

A: Yes.

Caller Q: This scheme has a lock-in period of one year which is fine but in case my portfolio appreciates after one year, can I sell some of it? But if I retain my Rs 50,000, can I take profits home?

A: The scheme allows some bit of flexibility after the first year but in the first year you cannot do anything. The stocks just stay as is. Subsequently, you need to keep a minimum of Rs 50,000 and it allows you flexibility to move around stocks and also take some money out.

Is Cyber Monday The New Black Friday?

While Black Friday is the biggest shopping day of the year, Cyber Monday is one of the biggest shopping days for online consumers. With retailers offering rock-bottom prices on a variety of products, some of the Cyber Monday deals give the highly coveted Black Friday sales a true run for their money. Does this mean that Cyber Monday is the new Black Friday? The answer to this question depends on the type of shopper you are and how good the deals are in stores near you. Here are three reasons why Cyber Monday may just be the New Black Friday.

More Enjoyable Than Black Friday Shopping
While many consumers take advantage of Black Friday shopping, it should be said that Black Friday shopping is no walk in the park. Black Friday hassles include long lines, over-crowded stores and low stock of highly sought after merchandise. The reason why Cyber Monday performs so well is that you can shop for your holiday gifts from the comfort of your own home. There is no need to rush out right after Thanksgiving dinner, stand in line in the cold and camp out for the doors to open at your local big box store. Cyber Monday allows consumers to shop for merchandise at rock-bottom prices without having to leave their homes.

Tremendous Deals That Rival Black Friday Sales
According to an article released by msn.com, many consumers are holding out until Cyber Monday for the best deals on merchandise. In 2011, Cyber Monday was the biggest online shopping day of the year with over $1.25 billion in sales. While many Cyber Monday ads are still under lock and key by retailers across the country, there are some who have given consumers a sneak peak. Surprisingly, many of these Cyber Monday ads rival Black Friday ads, which gives consumers much to consider in terms of when they will be going shopping this year.

Survey Expects a Huge Turnout for Cyber Monday 2012
CouponCabin.com has conducted a consumer survey and the findings show that almost half of the consumers surveyed plan to spend more money shopping ! online on Cyber Monday than in stores during the entire holiday season. Another notable finding from the survey includes 42% of consumers plan to scope out the deals on Black Friday and plan to make their purchases on Cyber Monday. Only time will tell if the survey's findings will ring true after the Cyber Monday sales figures are tallied. If 2012 follows suit with previous years, Cyber Monday will be a very good sales day indeed.

The Bottom Line
While the premise of Black Friday and Cyber Monday is similar, the way consumers shop is considerably different. Black Friday and Cyber Monday both aim to attract consumers to purchase more than they normally would with low prices and over-hyped ads. While Black Friday pulls massive crowds of consumers into retail stores across the country, Cyber Monday has consumers logging in, browsing and shopping online. Cyber Monday has the potential to increase sales and many retail stores offering free shipping. While Cyber Monday does not replace Black Friday, it is definitely giving shoppers a serious second alternative to waking up before dawn, standing in long lines and dealing with holiday season retail stress. This year is looking to be a great one for Cyber Monday and Black Friday sales, but it remains to be seen which day will reign supreme when it comes to sales.

Raytheon Wins $9.6M DoD Order - Analyst Blog

5 Best Financial Stocks To Own For 2014

Raytheon Company (RTN) has won a delivery contract, worth $9.6 million, from the U.S. Department of Defense (DoD). The contract, a part of the earlier issued Basic Ordering Agreement, deals with restoration of the H-60 Multi-Spectral Targeting System (MTS) forward looking infrared turrets.

Raytheon's Intelligence, Information and Services business will be responsible for this contract, which will take place in the company's facilities in McKinney, Texas and Jacksonville, Florida. The deal is scheduled to be completed by May 2014.

The MTS offers dependable long-range surveillance, target attainment, tracking, range discovery and laser designation of HELLFIRE and tri-service/North Atlantic Treaty Organization's (NATO) laser guided ammunitions. It features multiple fields of vision, electronic zoom and multimode video tracking facilities.

It is evident from past record that Raytheon has a strong relationship with the U.S. defense establishments. Raytheon has built the rapport due to its ability to meet the commitments in terms of maintaining products and services standard along with delivery timing.

Recently, Raytheon received a contract from the U.S. Naval Air Systems Command to produce an integrated multi-intelligence (Multi-INT) system to protect the warfighters positioned at the forefront.

The defense operators' performance primarily depends on the orders coming from the national and international defense bodies. With the risk of US defense budget cuts looming large, we believe the defense companies' attempt toward wining small ticket-size domestic and foreign orders will enable them to maintain a regular revenue flow.

Raytheon currently has a Zacks Rank #3 (Hold). However, other stocks from the sector that are presently performing well include Exelis, Inc. (XLS) with a Zacks Rank #1 (Strong Buy), and The Boeing! Company (BA) and Northrop Grumman Corporation (NOC) with a Zacks Rank #2 (Buy).

Foreclosure Activity Tumbles in 1H - Analyst Blog

Indicating a rebound in the housing sector, the foreclosure market report – released by RealtyTrac – showed overall foreclosure activity in the first half of 2013 to be on a downward trend. As per this leading online marketplace of foreclosure properties, foreclosure filings plunged 23% year over year and 19% from the last 6 months, bringing the total number of properties receiving default, auction or repossession notices to 801,359.

For the first six months of 2013, 409,491 foreclosure starts – default notices issued and foreclosure auctions (depending on the state's foreclosure procedure) – were filed across the U.S. As per the report, foreclosure starts are expected to reach 800,000 by the end of this year, down from 1.1 million in 2012.

Meanwhile, an aggregate of 248,538 bank repossessions (REOs) occurred in the first six months of 2013. Given this pace, REOs are anticipated to reach 500,000 by the year-end, down from approximately 671,000 in 2012.

Nevertheless, foreclosure activity continues to remain a drag for many states. The top 5 states with the highest foreclosure rates in the first half of the year were Florida, Nevada, Illinois, Ohio and Georgia. Additionally, the procedure to complete the foreclosure of properties in the second quarter took an average of 526 days, up from 477 days in the previous quarter.

The drop in foreclosure activity is a result of the switching of mortgage servicers and the government to other options to prevent foreclosures. However, foreclosure activity is expected to remain volatile, as processes that are being used in handling these differ from state to state.

Foreclosure activity is expected to increase in the judicial states as the latter have substantial backlogs to clear. This is evident from Jun 2013 data, as judicial foreclosure auctions were scheduled for 28,296 properties, up 34% from Jun 2012 and nearly 1% from May 2013.

This increase demonstrates that delayed foreclosure cases in judicial states ar! e now moving at a faster pace through foreclosure completion. Further, as the major servicers – JPMorgan Chase & Co. (JPM), Bank of America Corp (BAC), Citigroup Inc. (C), Ally Financial Inc. and Wells Fargo & Company (WFC) – adjust to the new rules set under the National Mortgage Settlement as well as several other state laws, foreclosure activity is bound to rise in the near term.

However, stabilizing housing prices are likely to aid homeowners in avoiding foreclosures. Further, the rate at which properties are entering the foreclosure procedure is expected to gradually slacken, thereby raising housing prices going forward.

The housing market will get an opportunity to regain a strong foothold if there are sufficient buyers for these properties. Moreover, with the gradual recovery of the U.S. economy, reduction of unemployment, improving consumer confidence and a rise in demand for homes, property prices are poised to rise further in the future.

Imagine The Upside If Facebook Solved Its Biggest Problem

Top 5 Gold Stocks To Own For 2014

Facebook (Nasdaq: FB) jumped to over $34 last week, marking the first time since its IPO that the stock has traded that high. This came after a one-day climb of nearly 30%.

A great one-day move, right? But let's put it in perspective: Since its May 2012 IPO, FB is still down more than 3%.

The social network blew through both earnings and revenue expectations. Second-quarter earnings per share came in at 19 cents, compared with the consensus forecast of 14 cents and the 12 cents a share posted during the second quarter last year.

In reality, all of Facebook's numbers were up big-time: Total monthly active users were up to 1.15 billion, up 20% year over year; mobile monthly active users were up to 819 million, up 51%; and daily active users were up to 699 million, up 27%.

The real gem? Mobile ad revenue came in at $656 million, up 76% from the previous quarter. Mobile ad revenue now makes up 40% of total ad revenue, compared with 30% of total ad revenue during the previous quarter.

Many investors believe that Facebook has finally hit the turning point and figured out how to monetize mobile. However, the question is, what's next? The company appears to have a lot of growth priced in, trading at a trailing price-to-earnings (P/E) ratio of 174, a price-to-sales ratio of nearly 15, and an enterprise value-to-EBITDA (earnings before interest, taxes, depreciation and amortization) multiple of 27.

Even with this expected growth priced in, the company has an opportunity for serious upside. It's simple, really.

Replace Mark Zuckerberg as CEO.

	Is Mark Zuckerberg holding back Facebook's growth?

There's a serious problem with keeping the founder as CEO once the company goes public. Running a public company is very different than running a startup. There are different challenges and goals, as well as the challenges of a shareholder mentality. As a startup, you're accountable to yourself and venture capitalists -- but as a public company, your shareholders look very different.

Unlike venture capitalists, who are more interested in product building and revenue growth, shareholders in a public company are much more interested in earnings. Many startups are accustomed to burning cash at rapid rates and losing money on an earnings basis. A new Facebook CEO with public company experience could be just what shareholders need to really launch the stock.

While there are founder CEOs who have gone on to have great careers, the trend of late is that publicly traded companies have performed better under a CEO with previous management experience at other public companies.

Reversal Of Fortunes
Groupon (Nasdaq: GRPN) is an example of a company that has flourished after the ouster of a founder lacking in management experience. When Andrew Mason -- who worked as a Web developer before founding Groupon -- was fired as CEO on Feb. 28, the online coupon company was down 80% from its initial public offering. Since his departure, Groupon is up 45%, compared with a 13% gain in the Nasdaq.

Similarly, the mobile gaming company Zynga (Nasdaq: ZNGA) ousted its founder CEO, Mark Pincus, on July 1. Prior to Zynga, Pincus had no management experience at a public company, though he had worked in venture capital and as a financial analyst. From its December 2011 IPO to Pincus' exit, ZNGA was down more than 40%. Since Don Mattrick -- a former president of Microsofy's Interactive Entertainment Business -- took the helm at Zynga, however, the stock is up just over 5%, in line with the Nasdaq's a! dvance in! the same period.

Steady As She Goes
For an example of a maturing company continuing on a growth path under its founder, consider the online review site Yelp (Nasdaq: YELP), which has kept founder CEO Jeremy Stoppelman at the reins. Stoppelman left e-payment firm PayPal, where he was vice president of engineering, to go to Harvard Business School, where he teamed with other PayPal executives to create Yelp. Since its March 2012 IPO, Yelp is up more than 60%, compared with a 20% gain for the Nasdaq.

Another PayPal alum, Reid Hoffman, left an executive vice president position to start LinkedIn (Nasdaq: LNKD). Since LinkedIn's May 2011 IPO, LinkedIn is up more than 110%, more than quadruple the Nasdaq's 26% gain.

Kayak Software is the travel booking website that was recently snatched up by Priceline (Nasdaq: PCLN) for $40 a share. Before founding Kayak, CEO Steve Hafner helped found Kayak's rival travel site, Orbitz, where he was in charge of marketing and business development. Kayak's buyout is a 20% premium to its initial trading price after its July 2012 IPO -- and a 50% premium from the stock's all-time low in August 2012.

Executive Ranks
Noting that Facebook could move higher with a new CEO is not to say that the social network doesn't have some great executives. Chief Technology Officer Mike Schroepfer served as CTO of Sun Microsystems' data automation unit and Mozilla's vice president of engineering. Chief Operating Officer Sheryl Sandberg was previously Google's vice president of global online sales and operations and served as chief of staff to former Treasury Secretary Larry Summers.

What are the chances of a Zuckerberg ouster? Not good. Zuckerberg has almost complete control of the company, commanding more than half of the voting shares and serving as both chairman and CEO.

With Zuckerberg holding the majority of the voting power, Facebook is a "controlled company," meaning it does not have to have the majority of its directors be indep! endent. W! ith all that said, why would Zuckerberg ever fire himself? Chances are, of course, that he won't. The stock would have to take a great deal of punishment from shareholders to convince Zuckerberg that it's time to go.

Action to take --> Avoid Facebook after its recent run-up. Zuckerberg isn't going away anytime soon, and one great quarter doesn't necessarily signal a true turning point at Facebook.

Top 5 Performing Stocks To Own Right Now

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

What: Shares of Zynga (NASDAQ: ZNGA  ) , a developer and marketer of online social games, dropped as much as 14% after the company announced plans to cut jobs and guided toward the low end of its previous bookings forecast.

So what: Zynga announced that it plans to cut a sizable 520 jobs -- roughly 18% of its workforce -- by August in order to save $70 million to $80 million annually. The move is being made as gaming competition and the costs of game development are steadily rising. The cuts will encompass all divisions of its workforce. Zynga reaffirmed its second-quarter EPS forecast, however, it also commented that bookings will be in the lower half of its previous forecast because many games outside of its Farmville franchise are underperforming. Despite the underperformance, Zynga also stuck to its previous full-year EBITDA guidance.

Top 5 Performing Stocks To Own Right Now: Amphenol Corporation(APH)

Amphenol Corporation engages in the design, manufacture, and marketing of electrical, electronic, and fiber optic connectors; interconnect systems; and coaxial and specialty cables worldwide. Its Interconnect Products and Assemblies segment produces connectors and connector assemblies primarily for the communications, aerospace, industrial, and automotive markets. This segment provides connector and cable assembly products used in communication applications; smart card acceptor and other interconnect devices used in mobile telephones; set top boxes to facilitate reading data from smart cards; fiber optic connectors used in fiber optic signal transmission; backplane and input/output connectors and assemblies used for servers and data storage devices and linking personal computers and peripheral equipment; sculptured flexible circuits used for integrating printed circuit boards; and hinge products used in mobile phone and other mobile communication devices. It also designs a nd produces radio frequency connector products and antennas used in telecommunications, computer and office equipment, instrumentation equipment, local area networks, and automotive electronics. The company?s Cable Products segment produces coaxial cable and connector products used in cable television systems, including full service cable television/telecommunication systems; radio frequency and fiber optic interconnect components for full service cable television/ telecommunication networks; and data cables and specialty cables used to connect internal components in systems with space and component configuration limitations. Amphenol Corporation markets its products directly, as well as through manufacturers? representatives and distributors to original equipment manufacturers, contract manufacturers, cable system operators, and telecommunication companies. The company was founded in 1932 and is headquartered in Wallingford, Connecticut.

Advisors' Opinion:

• [By Pat Racaniello]

  Amphenol Corp (APH) is our technology pick, a manufacturer of specialty cable and various connectors, including fiber optic ones, for use in electronic devices and the cable television industry. Near the lower band of the 52 week band ($40.44 - $59.11), the last traded price of $43.27 represents an excellent buy opportunity considering the stock is so far below the moving averages (50,100, 200).

  The main competition for companies such as Amphenol comes from Taiwanese component makers, that compete at a lower price. Amphenol has a solid market reputation and compared with Molex (MOLX), the free cash flow margin is far ahead at 10% compared to 5% for the latter. Price to earnings is on the industry mark at 14 times, but the concern lies in the dividend payout which is basically nothing (1.91) compared to the industry (26.91).

Top 5 Performing Stocks To Own Right Now: NovaBay Pharmaceuticals Inc. (NBY)

NovaBay Pharmaceuticals, Inc., a clinical-stage biotechnology company, engages in the development of various product candidates for the therapeutic needs of the anti-infective market. Its products include Aganocide compounds comprising NVC-422 that are synthetic molecules for the treatment of impetigo and adenoviral conjunctivitis, as well as for reducing the incidence of urinary catheter blockage and encrustation, and the associated urinary tract infections. The company is also involved in developing NeutroPhase, a solution for cleansing and debriding wounds. It has collaboration and license agreement with Galderma S.A. to develop and commercialize its Aganocide compounds, which covers acne, impetigo, and other dermatological conditions. The company was formerly known as NovaCal Pharmaceuticals, Inc. and changed its name to NovaBay Pharmaceuticals, Inc. in February 2007. NovaBay Pharmaceuticals, Inc. was incorporated in 2000 and is based in Emeryville, California.

Advisors' Opinion:

• [By CRWE]

  NovaBay(r) Pharmaceuticals, Inc. (Amex:NBY), a clinical-stage biotechnology company developing its first-in-class, anti-infective Aganocide(r) compounds for the local non-systemic treatment and prevention of infections, reported that Tom Paulson, Chief Financial Officer, will present at the Rodman & Renshaw 14th Annual Healthcare Conference held September 9-11, 2012, in New York, NY.

Best Cheap Companies To Invest In Right Now: Vertex Pharmaceuticals Incorporated(VRTX)

Vertex Pharmaceuticals Incorporated engages in discovering, developing, manufacturing, and commercializing small molecule drugs for the treatment of serious diseases worldwide. Its products include telaprevir, a prescription medicine used for the treatment of patients with genotype 1 hepatitis C virus (HCV) infection; and Ivacaftor, a prescription medicine used for the treatment of cystic fibrosis. The company markets its products under the INCIVEK brand name in the United States and Canada; INCIVO brand in the United Kingdom, Germany, France, Sweden, Austria, Finland, Denmark, Switzerland, and Norway; KALYDECO brand in the United States; and TELAVIC brand in Japan. Its drug candidates comprise VX-222, a Phase II clinical trial drug candidate, and ALS-2200 and ALS-2158, a Phase I clinical trial drug candidates that are designed to inhibit the replication of HCV; VX-809 and VX-661, a Phase II clinical trial drug candidates that improve the function of defective cystic fibro sis; VX-509, a Phase II clinical trial drug candidate for the treatment of patients with rheumatoid arthritis and other immune-mediated inflammatory diseases; VX-765, a Phase II clinical trial drug for the treatment of epilepsy; and VX-787, an investigational drug candidate for the treatment of influenza A. The company was founded in 1989 and is headquartered in Cambridge, Massachusetts.

Advisors' Opinion:

• [By Melly Alazraki]

  Vertex Pharmaceuticals (VRTX)topped the list with a 38.4% return as of Wednesday's close of $48.48. This $9.8 billion market capnon-profitablecompany is all promise. It is itspipelinethat's drawing investors, especially thehepatitis C treatment telaprevirandpotential cystic fibrosis drug VX-770.
  
  Both diseases present large market opportunities: Liver disease caused by the hepatitis C virusaffects 3.2 million individualsin the U.S. and as many as 100 million people worldwide. Cystic fibrosis is an inherited genetic disease that affects about 30,000 people in the U.S. and has few treatment options.
  
  Analysts ! have favored the stock, with aconsensus buy recommendation. However, just on Thursday, Vertex announcedtwomore telaprevir studyresultsthat did not impress investors and the stock declined 2% to $47.50. Also, Vertex is not without competitors and is in a race with Merck (MRK) and its experime ntal Hep C drug boceprevir to be the first to reach the market.
  
  The stock's 52-week high of $52.13 was set on March 7, up from a low of $31.25 set on July 1, 2011.

• [By Holly LaFon] Vertex Pharmaceuticals Inc. discovers, develops and markets small molecule drugs that address major unmet medical needs. Vertex Pharmaceuticals Inc. has a market cap of $7.25 billion; its shares were traded at around $34.74 with and P/S ratio of 50.5. Vertex Pharmaceuticals Inc. had an annual average earnings growth of 13.3% over the past 10 years.
  
  Hussman bought 1.8 million shares of Vertex in the fourth quarter at an average price of $35 per share.
  
  Vertex�� shares sunk to their 52-week low of $26.50 in November 2011, off of a 52-week high of $58.57. Meanwhile, the company was working on FDA approval of the first drug to treat the underlying cause of cystic fibrosis, called Kalydeco. The drug received approval on January 31 and sent shares up 9%.
  
  The company�� revenue has been slipping over the last several years, but saw a major jump in the third quarter of 2011 to $659.2 million, compared to $23.8 million for the third quarter of 2010. The increase was primarily a result of $419.6 million in net revenues from INCIVEK, a treatment for people with chronic genotype 1 hepatitis C, which became available in the third quarter. More than 25,000 Hepatitis C patients have begun treatment with INCIVEK as of Jan. 8, 2012. The company also received $200 in milestone revenues from collaborator Jannsen in the quarter.
  
  
  
  In January, it set forth its 2012 key business objectives. Jeffrey Leiden, M.D., Ph.D., who will become Vertex's CEO on Feb. 1, 2012, commented, "Entering 2012, we are focused on becoming a sustainable business with strong revenues from INCIVEK and the planned global launch of KALYDECO for cystic fibrosis. Importantly, we are pursuing opportunities to further improve treatment with our all-oral regimens in development for hepatitis C and efforts to study our cystic fibrosis medicines in a larger group of people with this devastating disease. As these and other pipeline programs advance, we will manage our business with financial discipline and focused investme! nt to ensure the greatest benefit for patients waiting for new treatments and for our shareholders."
• [By TheStreet Staff]

  Vertex Pharma's (VRTX ) cystic fibrosis drug Kalydeco will be approved. More importantly, studies testing Kalydeco combined with other Vertex's cystic fibrosis drugs will show strong benefit in a larger swath of patients. Vertex becomes a cystic fibrosis company. Hepatitis C? What's that?
  
  Correct. Kalydeco was approved in January -- in my opinion, the most important drug approval in 2012. The Kalydeco-VX-809 combination study was successful, even though the Street is still debating the magnitude of the regimen's benefit to cystic fibrosis patients

Top 5 Performing Stocks To Own Right Now: Dorman Products Inc.(DORM)

Dorman Products, Inc. supplies automotive replacement parts, fasteners, and service line products primarily for the automotive aftermarket. The company offers approximately 128,000 products comprising original equipment dealer parts, which include intake manifolds, exhaust manifolds, oil cooler lines, window regulators, radiator fan assemblies, power steering pulleys, and harmonic balancers; and replacement parts, such as window handles and switches, door hardware, interior trim parts, headlamp aiming screws and retainer rings, radiator parts, battery hold-down bolts and repair kits, valve train parts, and power steering filler caps. It also provides application specific and general automotive hardware, such as body hardware, general automotive fasteners, oil drain plugs, and wheel hardware; a selection of electrical connectors, wires, tools, testers, and accessories; and a line of home hardware and home organization products designed for retail merchandisers. In addition, the company offers a brake and clutch program; remanufactured automotive replacement parts, such as transfer case modules and instrument clusters; and heavy duty aftermarket parts for class 4-8 heavy vehicles, including coolant tubes, door handles and other body parts, fluid reservoirs, headlights and lighting, hood components, window regulators, and wiper transmissions. It sells its products under the OE Solutions, HELP!, AutoGrade, FirstStop, Conduct-Tite!, Pik-A-Nut, and HD Solutions brand names through automotive aftermarket retailers; national, regional, and local warehouse distributors; specialty markets; and salvage yards in the United States, Mexico, Europe, the Middle East, Asia, and Canada. The company, formerly known as R&B, Inc., was founded in 1978 and is headquartered in Colmar, Pennsylvania.

Top 5 Performing Stocks To Own Right Now: Alvarion Ltd.(ALVR)

Alvarion Ltd. supplies top-tier carriers, Internet service providers (ISPs), and private network operators with solutions based on the worldwide interoperability for Microwave Access (WiMAX) standard, as well as other wireless broadband solutions. The company provides WiMAX and non-WiMAX wireless broadband systems, and launched 250 commercial WiMAX deployments worldwide. Its solutions are designed to cover a range of frequency bands with fixed, portable, and mobile applications to enable the delivery of personal broadband services, business and residential broadband access, corporate virtual private network (VPN), toll quality telephony, mobile base station feeding, hotspot coverage extension, and services for various vertical markets, such as municipalities, public safety, mining, utilities, video surveillance, and border control. The company?s business mainly focuses on solutions, based on the WiMAX standard, that are used for primary wireless broadband access. In addit ion, Alvarion sells its non-WiMAX products, which address point-to-point and point-to-multipoint architectures for various end-user profiles, including residential, small office/home office, small/medium enterprises, multi-tenant/multi-dwelling units, and large enterprises, as well as provides network management solutions for its wireless solutions. Its solutions provide high-speed wireless ?last mile? connection to the Internet for homes and businesses in both developed and emerging markets. The company was formerly known as BreezeCOM Ltd. and changed its name to Alvarion Ltd. as result of merger with Floware Wireless Systems Ltd. in August 2001. Alvarion Ltd. was founded in 1992 and is headquartered in Tel Aviv, Israel.

Advisors' Opinion:

• [By Sy_Harding]

  This is a backdoor play on the growth in the developing world. The company supplies the WiMax networks that allow people in the developing world to get Internet access. This will be a high growth area but also at $3.80 a share, Alvarion is dirt cheap. It has $2.50 a share in cash in the bank, no debt, and is expected to earn 14 cents a share next year. Trading at less than 10 times earnings (when you back out the cash) and with the safe cushion of the cash, this stock is very attractive.

New Hire Roundup: Pascal Named President of Commonfund Capital

This week in new hires, Commonfund Capital named Donald Pascal president; Paul Knight, Michael Gyure and Michael Gorman joined Janney Capital Markets; Litman Gregory Asset Management welcomed Meredith Shuey Etherington; George Foreman and James Quinn joined Zeigler; and Miles Kirkland joined Truxton Trust.

Also, Christine Carolan moved up at Mercer, Steven Hobbs was named senior portfolio manager for the Private Client Reserve in Minneapolis, Chris Creed joined AFAM Capital, and Richard Brooks was appointed as an external director of Prudential Bank and Trust.

Commonfund Unit Names New President

Commonfund recently announced the promotion of Donald Pascal to president of Commonfund Capital, a wholly owned subsidiary of Commonfund focused on private equity, venture capital and natural resources investing. He succeeds Susan Carter in the position. Carter will retain her role as CEO of Commonfund Capital and retain overall strategic leadership of the group.

Pascal joined in 1998. He previously worked at Victory Ventures, Noel Group and The Prospect Group, all private capital funds organized by Louis Marx Jr. Earlier, he worked at E.M. Warburg Pincus & Co. and Strategic Planning Associates. He has 30 years of direct private capital and multimanager investment experience.

Janney Adds Three Senior Equity Research Professionals

Janney Capital Markets recently announced the hiring of Paul Knight as managing director and senior analyst covering life sciences technology. Additionally, the firm hired Michael Gorman as director and senior analyst covering the REIT sector and Michael Gyure as director and senior analyst, forensic accounting.

Knight brings more than 25 years of equity research experience, including time spent at CLSA, Thomas Weisel Partners and Solomon Brothers. His knowledge of the life sciences industry encompasses the segments of instrumentation, genomics and diagnostics industries.

Gyure joins with over a decade of experience on the sell side as a forensic accounting analyst. He began his career at Arthur Andersen, where he audited public and private companies across a myriad of industries.

Gorman, who has spent more than a decade on the sell side, will be covering the REIT sector. He joins from Cowen & Company where he specialized in retail and healthcare-related REITs. He also spent time at Credit Suisse and Prudential.

New Senior Investment Advisor Joins Litman Gregory Asset Management

Litman Gregory Asset Management announced that Meredith Shuey Etherington has joined the firm as senior investment advisor. She has been providing investment advisory services to individuals, family groups, foundations, and endowments since 2000.

Prior to joining, Etherington served as a portfolio manager with Brown Investment Advisory & Trust. She also previously served as a financial analyst in the private wealth management division of Goldman Sachs.

Foreman, Quinn Join Ziegler

Ziegler has hired George Foreman as a financial advisor in the firm’s recently opened Glen Allen, Va., office, and James (Jay) Quinn as a senior vice president and branch manager of its Greenwood Village, Colo., office.

Foreman served as an advisor for AXA Advisors before joining Ziegler and brings 12 years of industry experience to the Glen Allen office.

Quinn, with more than 25 years of advisory experience, is a CFP who works with high-net-worth clients and specializes in the equity markets.

Understand investing options

1. Savings Bank Account
Use only for short-term (less than 30 days) surpluses

Often the first banking product people use, savings accounts offer low interest (4%-5% p.a.), making them only marginally better than safe deposit lockers.

2. Money Market Funds (also known as liquid funds)
Offer better returns than savings account without compromising liquidity

Money market funds are a specialized form of mutual funds that invest in extremely short-term fixed income instruments. Unlike most mutual funds, money market funds are primarily oriented towards protecting your capital and then, aim to maximise returns.

Money market funds usually yield better returns than savings accounts, but lower than bank fixed deposits. With the flexibility to issue cheques from a money market fund account now available, explore this option before putting your money in a savings account.

3. Bank Fixed Deposit (Bank FDs)
For investors with low risk appetite, best for 6-12 months investment period

Also referred to as term deposits, this product would be offered by all banks. Minimum investment period for bank FDs is 30 days.

The ideal investment time for bank FDs is 6 to 12 months as normally interest on bank less than 6 months bank FDs is likely to be lower than money market fund returns.

It is important to plan your investment time frame while investing in this instrument because early withdrawals typically carry a penalty.

4. Post Office Savings Schemes (POSS)
Low risk and no TDS

POSS are popular because they typically yield a higher return than bank FDs. The monthly income plan could suit you if you are a retired individual or have regular income needs.

Besides the low (Government) risk, the fact that there is no tax deducted at source (TDS) in a POSS is amongst the key attractive features.

The Post Office offers various schemes that include National Savings Certificates (NSC), National Savings Scheme(NSS), Kisan Vikas Patra, Monthly ! Income Scheme and Recurring Deposit Scheme.

5. Public Provident Fund (PPF)
Best fixed-income investment for high tax payers

PPF is a very attractive fixed income investment option for small investors primarily because of -

1. An 11% post-tax return - effective pre-tax rate of 15.7% assuming a 30% tax rate

2. A tax-rebate - deduction of 20% of the amount invested from your tax liability for the year, subject to a maximum Rs60,000 for a tax rebate

3. Low risk - risk attached is Government risk

So, what's the catch? Lack of liquidity is a big negative. You can withdraw your investment made in Year 1 only in Year 7 (although there are some loan options that begin earlier).

If you are willing to live with poor liquidity, you should invest as much as you can in this scheme before looking for other fixed income investment options.


6. Company Fixed Deposits (FDs)
Option to maximise returns within a fixed-income portfolio

FDs are instruments used by companies to borrow from small investors. Typically FDs are open throughout the year. Invest in FDs only if you have surplus funds for more than 12 months. Select your investment period carefully as most FDs are not encashable prior to their maturity.

Just as in any other instrument, risk is an embedded feature of FDs, more so because it is not mandatory for non-finance companies to get a credit rating for this instrument.

Investors should consciously (either though a credit rating or through an expert) select the companies they invest in. Quite a few small investors have lost their life's savings by investing in FDs issued by companies that have run into financial problems.

7. Bonds and Debentures
Option for large investments or to avail of some capital gains tax rebates

Besides company FDs, bonds and debentures are the other fixed-income instruments issued by companies. As a result of an illiquid secondary market and a lack-lustre primary market, investment in th! ese instr! uments is largely skewed towards issues from financial institutions.

While you might find some high-yielding options in the secondary market, if you do not want the problems associated with bad deliveries and the transfer process or you want to invest a large sum of money, the primary market is the better option.

8. Mutual Funds
Have you ever made an investment in partnership with someone else? Well, mutual funds work on more or less the same principles. Investors pool together their money to buy stocks, bonds, or any other investments.

Investing through mutual funds allows an investor to -

1. Avail the services of a professional money manager (who manages the mutual fund)
2. Access a diversified portfolio despite making a limited investment

Our primer Investing in Mutual Funds should educate you a lot more on the benefits of investing in mutual funds and strategies you could employ.

9. Life Insurance Policies
Don't buy life insurance solely as an investment

Life insurance premiums, depending upon the policy selected, include the costs of -

1) death-benefit coverage

2) built-in investment returns (average 8.0% to 9.5% post-tax)

3) significant overheads, including commissions.

This implies that if you buy insurance solely as an investment, you are incurring costs that you would not incur in alternate investment options.

It is, however, important to insure your life if your financial needs and profile so require. Use our Are You Adequately Insured planning tool to find out if you need life insurance, and if yes, how much.

10. Equity Shares
Maximum returns over the long-term, invest funds you do not need for at least five years

There are two ways in which you can invest in equities-

1. through the secondary market (by buying shares that are listed on the stock exchanges)
2. through the primary market (by applying for shares that are offered to the public)

Over the long term, ! equity sh! ares have offered the maximum return to investors. As an investment option, investing in equity shares is also perceived to carry a high level of risk.

Learn more about building an equity portfolio in Investing in Equities

Illustrations: Vaibhav Shirke

Take some money off the table

10 Best Casino Stocks To Buy Right Now

Indian equities have rallied smartly since the start of June with the Sensex up nearly 10 per cent in the last one and half months. Year to date, the index has gained 13.5 percent and outperformed many of the other emerging stock markets indices including BRICS. See table below:

Indian Stock Market performance amongst BRICS
Country	Name of the Stock Indices	Year To Date Gain (10th July 2012)
Brazil	Sao Paulo Bovespa	-5.4
Russia	RTS Index	-1.4
India	Sensex	14.0
China	Shanghai Composite	-1.6
South Africa	Johannesburg All Share	6.3

 

 

 

 

 

 

 

 

 

 

This is despite the fact that the rupee has been on a roller coaster ride with daily volatility of more than 50 basis points and all macro-economic indicators projecting a grim picture.

So what is driving the stock indices especially when not many are gung ho about the Indian economy in the current financial year? GDP for fiscal 2011-12 grew 6.5 per cent after an average growth of 8.4 per cent between years 2006-2011. On the other hand, Indian Inc.'s performance has not been one of the best in the recent past with growth hurting due to high interest rates and inflation. Most equity analysts are not expecting any meaningful improvement in earnings for the June quarter. No mega capex plan has been announced by any of the leading business houses recently. This indicates that many corporate are waiting for clear signals for the economy to revive before committing funds. Some of the biggest FDI projects announced in the country from Posco ($12 billion for 12 million steel plants in Orissa) and Mittal for setting up steel plants in Orissa and Jharkhand, are running behind schedule, and there is no certainty on when these would go on stream. Even if these projects eventually go on stream it would be of much lesser capacity than what was envisaged initially. On the other hand, some of the foreign players who have set up shops in India are scaling down their Indian operations as they feel that Indian government is not doing enough to push the economy back on the growth track. The latest one being Fraport closing down its business development office in India despite many of the country's regional airports demand huge revamp offering great business opportunities.

So then why Indian stock indices are doing well?  One of the key factors driving sentiment appears to be hopes that financial reforms would get the priority as Prime Minister Manmohan Singh is now heading the Finance Ministry. He has an impeccable record of taking economy out from the slump as he did smartly something similar in 1991. But the point is can he do it again? That time he had unstinted support from then Prime Minister Narsimha Rao and Congress party to push the reforms. But this time he is fighting a lone battle with no great support from his own alliance partners and its own party. It would be litmus test for Prime Minister to push three eagerly awaited reforms; FDI in retail, hike in the prices of diesel and last but not least FDI relaxation in Insurance sector. If Prime Minister can muster courage to push these three things it would send right signals to foreign as well as domestic investors.

I have feeling that market is discounting the positive news too soon. One must understand that this government does not have enough majority in the parliament to pass any meaningful reforms. With one of its key allies Trinamool Congress almost on the verge of breaking ties with the government it looks that this government has another task on its hands once Presidential election is over. We would continue to have policy paralysis and government fightiing hard to  survive at the centre. 

On the valuation front, Indian market does not look cheap. Trailing 12 months Sensex price earnings is in the region of 14.1 times which I believe is not very healthy especially when economy is unlikely to expand at significant pace. Normally stock market command PE 2 time country's GDP growth rate. By that logic market should command P/E not more than 12 times assuming that country may GDP grow at 6 per cent  in the current financial year.

As an investor, I would see this stock market rally as an opportunity to take some money off the table rather than putting more. I have feeling that this rally will soon fizzle out when market realizes that the new FM does not have enough leeway to push the reforms. Also, the government is all likely to face another headwind in the form of poor monsoon. Till date, progresss of Southwest monsoon has been quite unsatisfactory and there is a high probability that India may face El Nino situation in the month of August and September resulting below average rainfall this season. This would not only impact the food grain production but also purchasing power of rural India which of late has been the only engine that is firing. On the other hand, poor monsoon would impact industry as there would be power shortages and water scarcity.  In all likelihood, weak monsoon will knock off at least 50-75 basis points GDP growth rate making it more difficult for the government to meet its growth target.

So I feel any rally in the market should be use as an opportunity to book profits rather than allowing greed to dominate.

Sunil Damania is an investment expert and was formerly managing editor of Dalal Street Journal

Albemarle JV Starts up TEA Facility - Analyst Blog

Specialty chemicals company Albemarle Corporation (ALB) said that its joint venture, Saudi Organometallic Chemicals Company (SOCC), has commenced initial production at its tri-ethyl aluminum (TEA) facility in Al-Jubail, Saudi Arabia.

SOCC is equally owned by Albemarle Netherlands B.V., a unit of Albemarle, and Saudi Specialty Chemical Company, an affiliate of leading petrochemical company Saudi Basic Industries Corporation (SABIC).

At capacity, the state-of-the-art aluminum alkyls facility will produce 6,000 metric tons per year of TEA, used as a co-catalyst in the plastics industry. The plant will also make ultra-low hydride grade of TEA (ULH-TEA). The facility is geared to address the growing needs for TEA and ULH-TEA in the Middle East, leveraging raw materials supplied from member nations of the Gulf Cooperation Council.

The first batch of TEA, which was successfully completed in mid-April 2013, met or surpassed all commercial specifications. Full commercial production is slated to commence in third-quarter 2013 following the competition of customer qualifications.

Baton Rouge, La.-based Albemarle is a premier global developer, producer, and marketer of highly-engineered specialty chemicals for consumer electronics, petroleum refining, utilities, packaging, construction, automotive/transportation, pharmaceuticals, crop protection, food-safety and custom chemistry services. The company operates with more than 4,000 employees and serves customers around 100 countries.

Best Stocks To Buy

Albemarle's first-quarter 2013 results, released in Apr 2013, were disappointing as both revenues and adjusted earnings missed Zacks Consensus Estimates. Its adjusted earnings for the quarter were 93 cents per share, trailing the Zacks Consensus Estimate of $1.00. Profit, as reported, tumbled roughly 27% year over year to $84 million or 94! cents per share.

Revenues fell roughly 10% year over year to $641.6 million in the quarter, missing the Zacks Consensus Estimate of $674 million. The results were hurt by Albemarle's exit from the phosphorus flame retardants business, lower metals surcharges and pricing on some products.

Albemarle, which currently holds a Zacks Rank #3 (Hold), will release its second quarter results on Jul 17.

Other companies in the chemical industry with favorable Zacks Rank are Cytec Industries Inc. (CYT), Olin Corp. (OLN) and PPG Industries Inc. (PPG). While both Cytec and Olin retains a Zacks Rank #1 (Strong Buy), PPG holds a Zacks Rank #2 (Buy).

Zacks #1 Ranked Real Estate Mutual Funds - Best of Funds

Top 10 Energy Companies To Invest In 2014

Even though real estate has been through tough times recently, securities from this sector should continue to be an integral part of portfolios with a long term horizon. Over the years, mutual funds from this category have continued to perform favorably. They offer a convenient method to invest in real estate because of low initial investment requirements and the advantage of professional management. Investors willing to hold long term positions would do well to consider these funds as they add stability and bring steady returns to a portfolio.

Below we will share with you 5 top rated real estate mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all real estate funds, investors can click here to see the complete list of funds.

ING International Real Estate A (IIRAX) invests most of its assets in equity of companies involved in real estate and related activities. A minimum of 65% of its assets are invested in foreign securities which may include securities from emerging markets. The diversified real-estate mutual fund returned 31.51% over the last one year period.

Joseph P. Smith is the Fund Manager and he has been managing this real estate mutual fund since 2011.

Forward Real Estate Long/Short A (KSRAX) seeks capital growth on a long-term basis and total return. The fund invests majority of its assets in REITs and real estate companies. Investments are made on a global basis including emerging nations and frontier market nations. The non-diversified real-estate mutual fund returned 20.38% over the last one year period.

The real estate mutual fund has an expense ratio of 1.72% higher than category average of 1.35%.

Fidelity International Real Estate (FIREX) invests majority of its assets in for! eign securities. Investments are parked after evaluating certain parameters. These include evaluation of the company's financial condition and its industry rank within its peers. The non-diversified real-estate mutual fund returned 41.81% over the last one year period.

Guillermo de las Casasis the fund manager and he has managed this real estate mutual fund since 2010.

VALIC Company I Global Real Estate (VGREX) seeks capital growth on a long-term basis with total return and current income. The fund invests most of its assets in equity of companies involved in real estate and related activities. The diversified real-estate mutual fund returned 25.35% over the last one year period.

As of May 2013, this real estate mutual fund held 105 issues, with 4.38% of its total assets invested in Mitsui Fudosan Co., Ltd.

PACE Global Real Estate Securities A (PREAX) invests majority of assets is parked in companies related to real estate industry. Investments are made worldwide, but usually, apart from investing in domestic companies, investments are made in three other countries. The real-estate mutual fund is non-diversified and has returned 23.70% over the last one year period.

The real estate mutual fund has an expense ratio of 1.45% in line with category average

To view the Zacks Rank and past performance of all real estate mutual funds, investors can click here to see the complete list of funds.

About Zacks Mutual Fund Rank

By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward. Learn more about the Zacks Mutual Fund Rank at http://www.zacks.com/funds.

Hot Energy Companies To Own In Right Now

In recent years, we've written extensively about master limited partnerships (MLPs) that are building out the nation's network of oil and gas pipelines. 

The investment theme has been a winner for two simple reasons:

Cash flows (and hence dividends) are predictable.  A steady industry expansion has led to solid growth for many of the top players.

With this kind of long-term predictability, it's no wonder MLPs are some of our favorite "Forever" investments. (Coined by StreetAuthority co-founder Paul Tracy, "Forever" investments are ones you can buy, hold and simply "forget about" while they steadily rise over the long term.)

One of the reasons we consider MLPs "Forever" investments is because, unlike some booms that fade after a few years, this boom has legs. Another wave of pipeline construction is underway to help carry landlocked energy to coastal refineries. And in coming quarters, there's a solid chance the Obama administration will give a formal green light to gas export facilities, which could trigger a whole new wave of pipeline development.

Hot Energy Companies To Own In Right Now: Archer Ltd (ARCHER)

Archer Ltd, formerly Seawell Limited is a Bermuda-based global oilfield service company. The Company provides drilling services, such as platform drilling, land drilling, modular rings, directional drilling, drill bits, tubular services, drilling and completion fluids, cementing tools, plugs and packers, underbalanced services, rentals and engineering. It specialises also in well services, such as wireline intervention, specialist intervention, frac valves, wireline logging, integrity diagnostics, imaging, production monitoring, coiled tubing, completion services and fishing. As of January 3, 2012, the Company's organizational structure centered on four geographic and strategic areas: North America (NAM), North Sea (NRS), Latin America (LAM) and Emerging Markets & Technologies (EMT). As of December 31, 2010, it was active through a number of subsidiaries, namely Seawell, Allis-Chalmers Energy, Gray Wireline, Rig Inspection Services and TecWel, among others.

Hot Energy Companies To Own In Right Now: Exxon Mobil Corporation(XOM)

Exxon Mobil Corporation engages in the exploration and production of crude oil and natural gas, and manufacture of petroleum products, as well as transportation and sale of crude oil, natural gas, and petroleum products. The company manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and other specialty products. As of December 31, 2010, it operated 35,691 gross and 30,494 net operated wells. The company has operations in the United States, Canada/South America, Europe, Africa, Asia, and Australia/Oceania. Exxon Mobil Corporation was founded in 1870 and is based in Irving, Texas.

Advisors' Opinion:

• [By Steven Goldberg]

  ExxonMobil (XOM, $88.00, 2.9%) is the world's biggest non-government-owned oil and gas company. Exxon's executives have long managed the company with an eye toward producing high profits for shareholders. In the past five years, Exxon has bought back $100 billion in stock and paid more than $40 billion in dividends. The stock, another Dow member, trades at 10 times estimated earnings (its yield is based on a recently announced increase in the dividend rate).

• [By Dan Moskowitz]

  This article�has been�heavy on optimism, but please keep in mind that this pertains to the long haul. A deflationary environment is a possibility in the coming years. If this type of environment presents itself, then Exxon Mobil will have to deal with some challenging times. However, as�hinted at�several times earlier, Exxon Mobil is a long-term OUTPERFORM.

Top 5 Heal Care Companies To Own In Right Now: PROS Holdings Inc.(PRO)

PROS Holdings, Inc. provides pricing and margin optimization software worldwide. It offers PROS Pricing Solution Suite, a set of integrated software products that enables enterprises to apply pricing and margin optimization science to determine, analyze, and execute optimal pricing strategies through the aggregation and analysis of enterprise application data, transactional data, and market information. The PROS Pricing Solution Suite consists of Scientific Analytics to gain insight into pricing performance; Price Optimizer to institute control of pricing policies; and Deal Optimizer to provide guidelines, additional context, and information to sales force. Its products also include PROS Revenue Management Solution Suite, a suite of industry specific revenue management software products for the enterprises in travel target markets. The PROS Revenue Management Solution Suite comprises PROS Analytics to identify hidden revenue leaks and opportunities, PROS Revenue Management product to manage passenger demand with leg- or segment-based revenue optimization, PROS O&D products to manage passenger demand with passenger name record or PNR based revenue optimization, PROS Real-Time Dynamic Pricing product to determine the optimal prices, PROS Group Revenue Management product to manage group request and booking revenues, PROS Network Revenue Planning product to deliver network-oriented fare class segmentation, PROS Cruise Pricing and Revenue Optimization for customers to understand consumers price sensitivities and track competitor behavior, PROS Hotel Revenue Optimization product that helps customers to enhance pricing decision. In addition, the company provides pricing and implementation professional, and ongoing support and maintenance services. It serves customers in the manufacturing, distribution, services, hotel and cruise, and airline industries primarily through its direct sales force. The company was founded in 1985 and is headquartered in Houston, Texas.

Advisors' Opinion:

• [By Fernandez]

  PROS Holdings, Inc. (NYSE: PRO), is a leading provider of pricing and revenue optimization software worldwide, in five major markets: airline, hotel, cruise, manufacturing and services.

  PROS has proprietary pricing algorithms and systems that have been developed and refined over many years of implementation and experience, that provide the company with a distinct competitive advantage over the many rivals that troll the pricing optimization space.

  When I recommended the purchase of PROS shares, I did not fully appreciate the potential severity of the downturn in IT spending, and the markets in which PROS operates.

  Even with the stock trading around $7.00 per share, I thought that there was more downside risk than upside potential.

  With shares now trading at $5.50 as of this writing, recommending selling shares at $7.00 when I did was indeed a prudent thing to do, as the shares are now down over 20% from where I recommended they be sold not too long ago.

  I detailed my exact reasons for selling shares of PROS here.

  The question now becomes, with the shares significantly lower than before, is PROS actually a bargain at these prices? (See page 2)

  I definitely think we are getting there, but wouldn’t venture to guess until after their next earnings announcement on 11-6-08.

Hot Energy Companies To Own In Right Now: Gastar Exploration Ltd (GST)

Gastar Exploration Ltd (Gastar) is an independent energy company engaged in the exploration, development and production of natural gas and oil in the United States. The Company�� principal business activities include the identification, acquisition, and subsequent exploration and development of natural gas and oil properties with an emphasis on unconventional reserves, such as shale resource plays. As of December 31, 2011, it is pursuing the development of liquids-rich natural gas in the Marcellus Shale in the Appalachia area of West Virginia and, to a lesser extent, central and southwestern Pennsylvania. The Company also holds prospective acreage in the deep Bossier play in the Hilltop area of East Texas and conduct limited coal bed methane (CBM) development activities within the Powder River Basin of Wyoming and Montana. The Company is a holding company. Advisors' Opinion:

• [By Roberto Pedone]

   Gastar Exploration (GST) is an independent energy company, engaged in the exploration, development and production of natural gas and oil in the U.S. This stock is trading up 2.8% to $1.26 in recent trading.

  Today’s Range: $1.24-$1.30

  52-Week Range: $0.70-$3.36

  Volume: 186,000

  Three-Month Average Volume: 516,159

  From a technical perspective, GST is bouncing modestly higher here right above some near-term support $1.15 with light volume. This stock has been uptrending strongly for the last month and change, with shares soaring from a low of 70 cents to its recent high of $1.38. During that move, shares of GST have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed GST within range of triggering a major breakout trade. That trade will hit if GST clears some near-term overhead resistance levels at $1.38 to $1.39 with high volume.

  Traders should now look for long-biased trades in GST as long as it’s trending above $1.15, and then once it sustains a move or close above those breakout levels with volume that hits near or above 516,159 million shares. If that breakout triggers soon, then GST will set up to re-test or possibly take out its next major overhead resistance level at its 200-day moving average of $1.77 or possible even $1.89 to $1.96.

Hot Energy Companies To Own In Right Now: Halcon Resources Corp (HK)

Halcon Resources Corporation (Halcon Resources), incorporated on February 5, 2004, is an independent energy company focused on the acquisition, production, exploration and development of onshore liquids-rich oil and natural gas assets in the United States. The Company has oil and natural gas reserves located primarily in Texas, North Dakota, Louisiana, Oklahoma and Montana. On August 1, 2012, the Company acquired GeoResources by merger. On December 6, 2012, the Company completed the acquisition of entities owning approximately 81,000 net acres prospective for the Bakken / Three Forks formations primarily located in Williams, Mountrail, McKenzie and Dunn Counties, North Dakota (the Williston Basin Assets), from Petro-Hunt, L.L.C. and Pillar Energy, LLC (the Petro-Hunt parties). As of December 31, 2012, the Company has working interests in approximately 128,000 net acres prospective for the Bakken / Three Forks formations in North Dakota and Montana.

The Company�� Woodbine / Eagle Ford acreage is prospective for the Woodbine, Eagle Ford and other formations, with targeted depths ranging anywhere from 7,000 feet to 10,400 feet. As of December 31, 2012, The Company has approximately 198,000 net acres leased or under contract primarily in Leon, Madison, Grimes, Brazos, and Polk Counties, Texas. The Company is the operator and has a 100% working interest in more than 12,000 net acres in Wichita and Wilbarger Counties, Texas that it is actively water flooding in shallow Cisco aged Pennsylvania sandstone and limestone reservoirs. As of December 31, 2012, the Company produced 484 million barrels of oil equivalent from approximately 700 active producing wells and approximately 230 active water injection wells.

The Company�� position in the La Copita Field covers 3,720 gross acres and 2,829 net acres in Starr County, Texas. As of December 31, 2012, the Company�� average net daily production was 623 barrels of oil equivalent per day. The Company operates 100% of this production a! nd its working interest ranges from 75% to 100%. The Company has various other oil and natural gas properties with varying working interests located across the United States, including the Austin Chalk Trend and Eagle Ford Shale in Texas, the Fitts-Allen Fields in Central Oklahoma, and various other areas across South Louisiana, Montana, North Dakota, New Mexico, and West Virginia.

Advisors' Opinion:

• [By Roberto Pedone]

  One energy player that insiders are active in here is Halcon Resources (HK), which is engaged in the acquisition, development, exploitation, exploration and production of oil and natural gas properties. Insiders are buying this stock into notable weakness, since shares are off by 22% so far in 2013.

  Halcon Resources has a market cap of $1.99 billion and an enterprise value of $4.71 billion. This stock trades at a premium valuation, with a trailing price-to-earnings of 112.50 and a forward price-to-earnings of 12.56. Its estimated growth rate for this year is 900%, and for next year it's pegged at 79.2%. This is not a cash-rich company, since the total cash position on its balance sheet is $3.06 million and its total debt is $2.71 billion.

  A director just bought 200,000 shares, or about $1.02 million worth of stock, at $5.10 per share. A beneficial owner also just bought 5.2 million shares, or about $26.44 million worth of stock, at $5.10 per share.

  From a technical perspective, HK is currently trending below both its 50-day and 200-day moving averages, which is bearish. This stock has been downtrending badly for the last six months, with shares moving lower from its high of $8.12 to its recent low of $4.92 a share. During that downtrend, shares of HK have been making mostly lower highs and lower lows, which is bearish technical price action. That said, this stock has started to find some buying interest off some previous support areas at $4.92 to $5.10 a share.

  If you're bullish on HK, then look for long-biased trades as long as this stock is trending above some key near-term support levels at $5.10 to $4.92 and then once it breaks out back above its 50-day at $5.67 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average volume of 5.14 million shares. If that breakout triggers soon, then HK will set up to re-test or possibly take out its next major overhead resistance levels at $6.11 to $6.54 a share. Any high-volume move above those levels will then give HK a chance to tag $6.75 to $6.84 a share.

Hot Energy Companies To Own In Right Now: Northgate Minerals Corporation(NXG)

Northgate Minerals Corporation, together with its subsidiaries, engages in exploring, developing, processing, and mining gold and copper deposits in Canada and Australia. Its principal producing assets include 100% interests in the Fosterville and Stawell Gold mines in Victoria, Australia; and the Kemess South mine located in north-central British Columbia, Canada. The company was formerly known as Northgate Exploration Limited and changed its name to Northgate Minerals Corporation in May 2004. Northgate Minerals Corporation was founded in 1919 and is headquartered in Toronto, Canada.

Advisors' Opinion:

• [By Christopher Barker]

  I've been reminding Fools to consider positioning for Northgate Minerals' golden explosion for months, and patient gold investors continue to await the day when Northgate's powerful prospects are more fully reflected in the shares. Construction of the critical Young-Davidson mine continues right on schedule, and first production now stands about two quarters away. That means Northgate is reasonably likely to achieve its 2012 production target of 300,000 ounces, followed by 350,000 ounces in 2013. Meanwhile, Northgate recently drilled "one of the best holes ever intersected on the property" -- featuring 4.31 grams of gold per ton over a very wide 79.6-meter segment -- from a new discovery zone outside of the existing 2.8 million-ounce reserve.

  If Young-Davidson were Northgate's sole asset, these shares would still be undervalued here at about $2.60 per share. With a preliminary assessment looming for the reworked Kemess Underground project, a new drill program at the Awakening Gold project in Nevada, and two operating gold mines in Australia, Northgate figures among the clearest bargains in the gold patch.

Ben Graham Net-Net Newsletter: Gencor (GENC) One Year Later

I've decided not to sell net-nets after one year for the Ben Graham Net-Net Newsletter. This was always kind of a crazy idea. And there's no reason to do it. I still have to pick a new net-net every month. So what's the point of selling an old pick just because it's been a year? Ben Graham and Walter Schloss didn't do that. We shouldn't either.

Instead, I'm just going to reveal what stock the Ben Graham Net-Net Newsletter's model portfolio bought in the same month last year and tell folks whether or not we will sell that stock. My procedure will be to revisit each stock only once a year. So, by deciding to keep the March 2011 pick for now – I won't be revisiting the again stock until March 2013. That'll be the next time the Ben Graham Net-Net Newsletter can sell it.

I think the risk of high portfolio turnover is a big one in a net-net portfolio. And I want to do everything to discourage readers from developing this bad habit.

So, I'll stick to this procedure…

Each month, the Ben Graham Net-Net Newsletter will:

· Pick a new net-net to buy

· And decide whether to sell an old net-net

The net-nets the newsletter already owns will only be revisited once a year. I'll decide whether or not to sell the June 2011 pick in June 2012 – and then if I choose to keep it for another year – I'll decide whether to sell it in June 2013. But I won't sell the June pick in September.

I'm not reconsidering every pick every month. That just encourages portfolio churn. I'm not that good at selling anyway. I certainly can't time a stock with a matter of months. A once a year checkup will be quite enough.

So, there will be a new pick every month. A new stock the Ben Graham Net-Net Newsletter's model portfolio goes out and bids for. And we will revisit an old pick.

Also, one year after a net-net is chosen, I'll write about it here in an article at GuruFocus. This way folks who aren't subscribing to the Ben Graham N! et-Net Newsletter can get a taste of what it's like.

Okay. Let's talk about the March 2011 pick.

Original Rationale (March 2011)

Here were the pros and cons of an investment in Gencor (GENC) – as I laid them out in the Ben Graham Net-Net Newsletter – one year ago:

Pros

· $8.22 a share in investments. 55% bonds / 41% stocks / 4% cash. All marked to market.

· Very few liabilities.

· Ultra-conservative accounting.

· 99 acres of land. 72 acres in Marquette, Iowa. 27 acres in Orlando, Florida.

· Buildings. Owns 352,000 square feet outright. 215,000 square feet in Florida. 137,000 square feet in Iowa.

· Property and equipment is over depreciated. Original cost of $23 million written down to $4.2 million.

· Large losses are rare in this business. Gencor's balance sheet can easily absorb any downturn.

· Very long history as a public company. Decent long-term record. Established business. Not speculative.

Cons

· Controlled company

· Elliott family uses B shares to elect 75% of the board without needing majority economic ownership.

· Considering acquisitions and other uses for its investment portfolio.

· No real history of either paying dividends or buying back stock. Has no intention of paying dividends.

· Father and son are Chairman, CEO, and President.

· Worse yet – son is also CFO. No non-family members at the very top.

· Permanently mediocre business.

· Depends on continued infrastructure spending by financially weak federal and state governments in U.S.

· Management makes little effort to explain its accounting and capital allocation choices to shareholders.

Okay. So that's what I said a year ago. How has the stock done?

In a word: badly.

Actual Performance

On March 7th, 2011 the Ben Graham Net-Net Newsletter's model portfolio bought 77 shares of Gencor (GENC) ! at $7.90.! And paid a $7 commission. For a total cost of $7.99 a share.

On February 29th, 2012 Gencor opened at $6.97 a share. So, the Ben Graham Net-Net Newsletter's model portfolio lost 13% on Gencor over the past year.

Gencor: Sell or Hold?

Gencor was always a controversial pick. And I recently got a really good email – arguing against it – citing this 1999 court case:

September 2000 Class Action Complaint – Gencor (in PDF)

And asking this very good question:

"Just curious, why would you stay invested in this? Would you ever buy something if senior management had a reputation/history like this? Sure, maybe it's not all true and maybe they changed their lives, but realistically there is a fair chance that not all is clean and clear at Gencor…"

Gencor is a pick I made for the Ben Graham Net-Net Newsletter. Not for my personal portfolio. I would not buy Gencor if it was going to be a 10% or 25% position I intend to hold for a while. Which is basically what I try to do with my own money. I don't encourage subscribers to the Ben Graham Net-Net Newsletter to think of the net-net I pick for the newsletter as good individual stock picks. Instead, they should think of net-nets as a group operation.

Ideally, subscribers should buy every net-net I pick for the newsletter. Then they would be averaging into the net-net market in equal installments every month. And they'd get a diversified group of net-nets. This was very much Ben Graham's style. Buy a little all the time. And own many, many different net-nets.

Gencor is a lousy candidate for a top holding in anyone's portfolio. For two obvious reasons:

1) Management

2) Business

I'm very reluctant to invest in a company with an operating business that detracts from the value of the company and perhaps adds quite a bit of risk. You could definitely see how that could be true here. Then there is management. Even before considering the possibility of fraud, I always ima! gined man! agement in this situation will use the cash to make an acquisition I don't care for.

So, why continue to hold Gencor?

Do you really think it is more risky than the average net-net?

It may be. I'm not sure I believe that. I mean I read what you sent and I know what they are reporting now in terms of their balance sheet, etc.

It's hard to assess the risk there.

We need to consider the probability that management is engaging in fraud. And the magnitude of the loss such fraud would cause us. For example, with a Chinese reverse merger stock I often consider the magnitude of the loss due to fraud to be 100% of the stock's purchase price. Basically, I believe some of those reverse mergers are complete frauds. And they were frauds from the start. The business essentially never existed.

What is the likelihood of that kind of fraud here?

I'm no expert on frauds. I repeat this all the time, because it's true. If I were an expert on frauds, I'd be a short-seller.

I consider the likelihood of that kind of complete fabrication to be small at Gencor. As you know from reading last year's March issue of the Ben Graham Net-Net Newsletter where I picked Gencor, I did happen to look up some of Gencor's assets in county records. (I wasn't looking for evidence of a fraud. I was curious about something I found in the footnotes on depreciation of property and equipment). Rather than finding the carrying values of Gencor's assets to be inflated – I found book value probably understated the value of some of Gencor's assets. Namely, its buildings and inventory.

Gencor uses LIFO accounting. And it has a lot of fully depreciated assets still in service. It just seemed like depreciation was way too high at Gencor. So I wanted to check that out.

Now, it's very possible I could be wrong in terms of what those facts mean to the likelihood of a complete fraud. But I wouldn't go as far as to say a couple accounting choices are evidence ag! ainst the! existence of fraud. Rather, I'd say that in Gencor's recent SEC reports, management doesn't seem to have gone out of its way to present the company in an especially attractive light. In fact, Gencor accounts for certain things in a way that hurts their headline results. Of course, a company could still do that and be a fraud.

And let's face it – although the Elliotts and Gencor did not admit guilt in the class action suit – they did wrong. That may not be a legal fact. But it's an investment fact as far as I'm concerned. We should operate on the assumption that prior to its bankruptcy, Gencor engaged in fraud.

Investment analysis makes assumptions all the time. And conservatism is one of the principles of Ben Graham style value investing. So, for this entire discussion, we're assuming that everything the plaintiffs alleged about Gencor was true.

So, why will the Ben Graham Net-Net Newsletter keep its shares of Gencor for at least another year?

The question isn't whether I like Gencor or its management team. And it's certainly not whether reading the archived documents makes me queasy – it does – the question is safety. Is the Ben Graham Net-Net Newsletter's model portfolio safe without Gencor in it?

I'm not sure. But I actually don't think the evidence is strong that the portfolio would be safer. The reprehensibility of a particular black mark against a stock is not a measure of that stock's safety as an investment.

Most businesses fail with clean hands and good intentions. They still leave shareholders nothing. It is only the second part – the shareholder losses – we are concerned with here.

Gencor's assets are – conservatively calculated – worth well in excess of the stock price. When I picked the stock for the Ben Graham Net-Net Newsletter, Gencor's book value was $10.28 a share. I estimated the actual value of the company's assets was more like $12 a share. The difference is caused by the value at whi! ch Gencor! was carrying its buildings and inventory.

Obviously, to the extent you believe the assets shown are not accurately portrayed by the company – all that goes away.

Since the risk in Gencor – fraud – is quite clear and emotionally charged, it's worth reminding folks where the safety in Gencor comes from.

We are talking about a company that claims to have $12 in current assets for every $1 of total liabilities. And $9 in cash and securities for every $1 in total liabilities. Those are very large margins of safety. I have to pick a net-net for this Friday's Ben Graham Net-Net Newsletter – and the most likely candidate is a company that has maybe $1.25 in current assets for every $1 in total liabilities. I hate picking a stock like that. A very small operating loss suddenly puts them in a precarious financial position. That is not the case here. Gencor has very high liquid assets relative to total liabilities.

We're basically talking about an investment portfolio of $8.20 a share split between:

Cash: 7%

Stocks: 37%

Bonds: 56%

For that, you'd be selling out at $6.97 a share. The operating assets (current and non-current) seem perfectly appropriate to the level of total liabilities. In other words, putting aside the operating business, when you sell Gencor stock today – you really are selling someone a very balanced bond and stock portfolio at a 15% discount to what it was carried at on December 31st.

In addition, Gencor owns some buildings, land, etc. that have value.

Often, we're talking about net-nets where all the current assets backing the purchase are in inventories and receivables.

At Gencor, we're talking about a situation where investments alone cover more than the full price of the stock.

I don't know if this makes sense. But I think I'm maybe less sensitive to issues like this – potentially crooked management – than a lot of investors. And I'm a lot more sensitive to just the idea that an operatin! g busines! s run by perfectly well intentioned people could go bust when it's got a small cushion in terms of current assets to total liabilities.

I have to weigh the risk to safety posed by management – the risk of fraud especially – against the financial situation of the company. A lot of net-nets I pick for the Ben Graham Net-Net Newsletter are reporting much more precarious financial circumstances.

It's hard for me to say that Gencor is more risky than the stocks I could replace Gencor with in the Ben Graham Net-Net Newsletter's model portfolio.

It's a lot less pleasant to think about Gencor than what I could replace it with. A management team you distrust is not something anyone wants to think about.

But, let's take an example like Sigmatron (SGMA) or Duckwall-ALCO (DUCK). These are the kinds of stocks that are near the top of the list of net-nets not already in the Ben Graham Net-Net Newsletter's model portfolio. So they could be added in future issues.

(Quick note: These stocks are near the top of a list of potential net-net picks simply because they've been profitable in most years. A lot of net-nets have continual losses. I tend not to pick those for the newsletter.)

Sigmatron has $1.47 in current assets for every $1 of total liabilities. More than 90% of those current assets are in inventories and receivables. And this is not a predictable, profitable kind of company (or industry). So, there are substantial risks.

Is Sigmatron safer than Gencor?

Meanwhile, Duckwall-ALCO has $1.42 in current assets for every $1 of total liabilities. And more than 90% of ALCO's current assets are in inventory. The company's inventory is about twice its book value and about 6 times its market cap. The business model is badly flawed and will have a hard time earning a decent return on equity even under optimal conditions.

ALCO's capital is stuck in the form of low-earning inventory. This doesn't just limit the company's upside it also creates ! real risk! s to the downside.

Is Duckwall-ALCO safer than Gencor?

In both cases, I don't know. I certainly don't believe either Sigmatron or ALCO is clearly safer than Gencor. And these are the kind of net-nets I might add to the portfolio. Now, I do think some of the other net-nets that the Ben Graham Net-Net Newsletter already owns are safer. And I'll talk about those in articles like this – that Premium Members and non-Premium Member alike can read – on those stocks' one year anniversaries.

The Ben Graham Net-Net Newsletter is a group operation. I need to have some reason for believing that taking out Gencor or replacing Gencor with another currently available net-net increases the safety of the portfolio.

I feel there's not enough evidence to support that. You may feel differently on that point. Where the same management team settled a fraud allegation in the past – I totally understand why you feel the way you do.

But I don't see how selling Gencor here increases the safety of the Ben Graham Net-Net Newsletter's model portfolio. That cash will be used to buy another net-net. And the idea is to diversify across net-nets.

There are problems with other stocks I could choose as well. They're different. They usually don't involve the risk of fraud. Sometimes they just involve dying industries, bad businesses, and low ratios of current assets to total liabilities. But those are real risks.

They don't involve possible misconduct by living, breathing human beings – so there is no sense of potential betrayal attached to those risks. They are less emotionally charged. But they are still very real. And you can lose as much money betting on a bad horse as betting on a bad jockey.

Maybe you blame the jockey more than the horse. Your brain cares how you lose money. But your wallet doesn't. A loss is a loss.

All that isn't really a very strong endorsement of Gencor. Well, I don't mean to endorse Gencor here. Certainly not as an i! ndividual! stock.

What about as part of a group?

Let me explain the situation. The Ben Graham Net-Net Newsletter owns shares of Gencor. I have to decide what to do with those shares.

Here's why I think we should hold our Gencor shares – and revisit the stock next March.

We have a stock – Gencor – that is still selling below NCAV, that is still selling below our purchase price, and which we've only held for a single year.

In general, that's a recipe for poor performance. Especially the last one. Selling after just a year. That's not a good idea for any net-net portfolio.

You know the history of how Ben Graham and Walter Schloss invested in net-nets. We're just as often talking about holding on to a net-net for 4 or 5 years rather than 1 year. The biggest systematic mistake I can make with the Ben Graham Net-Net Newsletter is always selling too soon.

If the Ben Graham Net-Net Newsletter holds on to its net-nets for long enough, and I do a decent job of picking more winners than losers – the model portfolio can survive a few of my screw-ups (which Gencor may very well be).

But if we start selling because it's been a year, the stock is lower than where we bought it, and we feel icky whenever we think about the company and its management – we're going to have really high turnover.

Because that describes a lot of net-nets. They keep going down for a while after you buy them, they make you feel icky, and you're eager to just move on.

That's most net-nets.

So I have to be disciplined in terms of procedure even if I get some stock picks wrong.

And I will get some wrong. Boy, will I get some wrong. Gencor may be one of those.

It's down 13% so far. And we're keeping it for another year.

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