Greek debt talks drag on

NEW YORK (CNNMoney) -- Greece and its private sector creditors remain mired in deep negotiations over a deal to reduce the nation's crushing debt load.

Institute of International Finance director Charles Dallara, who represents the private sector investors and banks that hold Greek debt, said "it's not entirely clear" how close the parties are to a deal.

"I wouldn't say I'm confident, but I'm hopeful we'll reach agreement," Dallara told CNN International's Richard Quest in a phone interview from Athens.

The talks ended Wednesday without an agreement. They will resume Thursday and Dallara said final terms could be reached in the days ahead.

The IIF has been in discussions with the Greek government over an agreement to voluntarily write down the value of Greek government bonds by 50%.

The private sector holds over €200 billion worth of Greece's total debt load -- estimated at €350 billion.

Dallara said the group intends to follow through on the 50% writedown, which was announced following a summit of European Union leaders in December.

That would result in significant losses for the private sector. But it would also help reduce Greece's debt load to 120% of economic output by 2020.

In addition, Dallara said 15% of the remaining amount that Greece owes the private sector would be paid in cash. Another 35% would be restructured, or replaced with loans that have longer maturities and lower interest rates.

The talks broke down last week amid demands for even larger write downs, and Greek Prime Minister Lucas Papademos' call for a private sector participation rate of 100%.

Dallara told CNN he's confident the group can "mobilize a high participation." But that doesn't mean 100%, he added.

The deal is a key condition for Greece to receive additional bailout funds from the European Union and International Monetary Fund. Without additional financial support, Greece may not be able to make a €14 bill! ion paym ent it owes on bonds coming due March 20.

Dallara stressed that both sides are interested in finding "common ground."

World Bank warns on risk of global recession

He said the creditors recognize that a portion of Greece's debt needs to be written off in order to avoid a "disorderly" default, which could have severe repercussions for the global economy. But he acknowledged that some investors may be worried that other euro area governments could extract similar concessions.

All governments have an interest in resolving Greece's debt problems "in a cooperative manner" so that investors will be confident that issues this extreme can be resolved "in a mutually satisfactory way," said Dallara.

-- CNN's Jim Boulden contributed to this report from London.  

With $2.3 Billion Deal, Thailand Joins Asian Rush For Canadian Oil Sands

Thailand last week joined the crush of Asian countries rushing to acquire a stake in Canada's giant oil sands projects when its PTT Exploration & Production Public Co. Ltd. (OTC ADR: PEXNY) agreed to buy 40% of Statoil ASA's (NYSE ADR: STO) Canadian oil sands project for $2.3 billion.

PTTEP, the exploration and production unit of state-owned PTT PCL, is making Thailand's first foray into Canada's oil sands, the largest source of crude oil outside the Middle East.

Norway's Statoil will keep majority ownership and remain the primary operator in the Kai Kos Dehseh project in northern Alberta, which it bought in 2007, according to the deal announced on Tuesday.

Asian companies participating in oil sands projects now prefer to enter partnerships in the projects, leaving complicated field operations to other companies, according to Dr. Kent Moors, a consultant and global energy-sector insider who is also the founder and editor of The Energy Inner Circle, the newest Money Map Press advisory service.

"Several Chinese and other Asian companies have already farmed-in to projects. It is best for them to take a project interest, thereby controlling a percentage of the extraction, but not be the operating company [in the] partnership," Dr. Moors said in an e-mail interview with Money Morning.

Asian state oil firms, led by China, have been scrambling to acquire oil sands projects, spending billions to fuel their booming economies.

The most notable recent Asian entries into Canada's oil sands include:

  • China Petroleum & Chemical Corp. (Sinopec) (NYSE ADR: SNP), China's largest oil refiner and second-biggest oil producer, agreed in April to pay ConocoPhillips (NYSE: COP) $4.65 billion to purchase a 9.03% stake in Syncrude Canada Ltd, the largest oil sands project.!
  • < li>Penn West Energy Trust (NYSE: PWE) in May sold China Investment Corp., the government's giant investment fund, a 45% share of oil sands properties near Peace River, Alberta, for $801 million.
  • In December 2009, the Canadian government gave formal approval for a PetroChina Co. Ltd. (NYSE ADR: PTR) deal to buy a 60% stake in two undeveloped oil sands properties held by Athabasca Oil Sands Corp. that could eventually produce as much as 500,000 barrels per day.
  • Korea National Oil Corp. bought Newmont Mining Corp's (NYSE: NEM) BlackGold oil sands property for $270 million in July 2006.
  • China National Offshore Oil Corp. (CNOOC) (NYSE ADR: CEO), China's giant offshore oil developer, in 2005 paid privately held MEG Energy Ltd $122 million for a 16.7% partnership stake to develop an oil sands project in northern Alberta that could eventually pump up to 210,000 bpd.

Wheat's Forecasted Price Drop Highlights Profit Plays in Commodities

Medco Health Solutions Inc. (NYSE:MHS) achieved its new 52 week high price of $66.38 where it was opened at $65.87 UP 8.05 points or +14.43% by closing at $63.83. MHS transacted shares during the day were over 70.98 million shares however it has an average volume of 3.24 million shares.

MHS has a market capitalization $25.52 billion and an enterprise value at $27.16 billion. Trailing twelve months price to sales ratio of the stock was 0.33 while price to book ratio in most recent quarter was 6.20. In profitability ratios, net profit margin in past twelve months appeared at 2.16% whereas operating profit margin for the same period at 3.80%.

The company made a return on asset of 9.66% in past twelve months and return on equity of 31.55% for similar period. In the period of trailing 12 months it generated revenue amounted to $66.68 billion gaining $155.99 revenue per share. Its year over year, quarterly growth of revenue was 4.30% holding 3.90% quarterly earnings growth.

According to preceding quarter balance sheet results, the company had $171.10 million cash in hand making cash per share at 0.43. The total of $5.03 billion debt was there putting a total debt to equity ratio 139.78. Moreover its current ratio according to same quarter results was 0.91 and book value per share was 9.00.

Looking at the trading information, the stock price history displayed that its S&P500 52 Week Change illustrated 22.87% where the stock price exhibited up beat from its 50 day moving average with $56.08 and remained above from its 200 Day Moving Average with $59.44.

MHS holds 399.80 million outstanding shares with 397.29 million floating shares where insider possessed 0.09% and institutions kept 76.60%.

Neurocrine Biosciences Inc. (NBIX) Climbs on Positive Results in Daisy PETAL Study

Shares of Neurocrine Biosciences Inc. (NASDAQ: NBIX) jumped more than 40% in after-hours trading. At last check, the small cap stock was up 46.52% to $4, with volume at 220,000, in after-hours trading. Earlier, in regular trading, the small cap stock closed 0.37% higher, reaching a high of $2.88. San Diego, California-based Neurocrine Biosciences is involved in the development, discovery and commercialization of drugs for treating neurological and endocrine-related diseases and disorders.

The company today announced top-line efficacy results from its phase 2 Daisy PETAL study. The results are both, statistically and clinically, meaningful. Chris O' Brien, M.D., chief medical officer at the company, said that the Daisy PETAL study was successful as it met all primary and secondary efficacy endpoints and also gave the company the information needed to take the program ahead. Following the announcement of positive results, the small-cap stock jumped in after hours.

The company's most recent quarterly results show that it had total revenue of $753,000 in the three-month period ended March 31, 2010. This is slightly above $747,000 it reported in the same period last year. In is most recent quarter, the company reported a loss of $8,636, compared with a loss of $19,665 reported last year. Till date, the company has not generated any revenue from sale of products. In its latest 10Q filing, the company says that it relies and will continue to rely very heavily on corporate collaborators. As a result, the company's development and commercialization programs could be delayed substantially, if in case the company is not able to enter into additional collaborations.

The small cap stock is subject to price fluctuations driven mainly by results of the company's clinical trials and development related to FDA approval process. The stock has a 52-week range of $1.94-$3.67.? At the moment, the stock is above its 50-day and 200-day moving averages. The stock has one Bu! y rating and Five Hold ratings, currently.

About is committed to producing the highest-quality insight and analysis of small cap stocks, emerging technology stocks,hot penny stocks and helping investors make informed decisions. Our focus is primarily on the underserved OTC stocks market, or "penny stock" market, which has traditionally been shunned by Wall Street. We have particular expertise with renewable energy stocks, biotech stocks, oil stocks, green energy stocks and internet stocks. There are many hot penny stock opportunities present in the OTC market everyday and we seek to exploit these hot stock gains for our members before the average daytrader is aware of them.

The Serial Backdoor Roth, A Tax-Free Retirement Kitty

If your income is too high, you can��t contribute directly to a Roth individual retirement account, but you can get one in a backdoor way. Step 1: Open a traditional IRA (in your case, it��s nondeductible). Step 2: Convert it to a Roth IRA. Is it worth it? ��It��s a no-brainer if you have the cash to do it,�� says Kevin Huston, an enrolled agent in Asheville, N.C. who has clients both young and old doing it to shore up their retirement savings. ��It especially makes sense for people who are younger because they have all these years of tax-free growth,�� he says.

Basically, you get an extra $5,000 (or $6,000 if you��re 50 or older) each year that grows in the Roth IRA income-tax free. That��s $10,000 (or $12,000) a year for a married couple. Repeat each year, and you can amass a nice retirement kitty. The audience for backdoor Roths is a niche, appealing to those earning too much to contribute to Roths directly but not so much that the extra tax savings doesn��t seem worth the effort. Vanguard says that ��backdoor Roth�� contributions represented about 2 percent of traditional IRA contributions in 2010. That��s the year that income restrictions were lifted, and anyone��regardless of income��could convert a traditional IRA to a Roth, leading to a boomlet of Roth conversions.

Why go through the hoops of getting money into a Roth IRA? They are an amazing deal, especially for folks looking long-term and expecting higher tax rates in the future. With a Roth IRA you don��t ever have to take money out, and when you do start taking money out, it��s all income-tax-free, including the earnings. By contrast, with a traditional IRA, earnings grow tax-deferred, you have to start taking required mandatory distributions the year after you turn 70.5, and distributions count as income. A Roth can help keep your tax bite down in retirement. (Ideally you want a mix of taxable, tax-deferred and tax-free accounts to draw from in retirement.)

A Roth IRA also has ot! her bene fits. Medicare premiums are based on income, so by keeping your income down, you��ll pay a lower premium. And if you leave a Roth account to a child, he or she will have to take money out each year, but there will be no income tax hit. (Inheriting a $100,000 Roth IRA is a whole lot better than inheriting a $100,000 traditional IRA; the higher your beneficiary��s tax bracket, the bigger the savings).

Here��s how the strategy is helping a couple in their 40s build their nest egg. The wife��s in marketing with a pharmaceutical company, and the husband is a stay-at-home dad. First, she��s maxing out on her company pre-tax 401(k) plan contributions��putting away the full $17,000 for 2012��her employer doesn��t offer a Roth 401(k) option. The couple told their tax advisor Huston they want to save more, but they can��t contribute to Roth IRAs directly because her income is nearly $200,000 a year. (Once your modified adjusted gross income is $183,000 for a couple filing jointly or $125,000 for singles, no Roth IRA contributions are allowed).

But they can each contribute to a traditional IRA. They don��t get a deduction because of the wife��s high income, so it��s called a nondeductible IRA. She puts away $5,000, and he puts away $5,000 (his IRA is based on her earning and called a nondeductible spousal IRA; otherwise you have to have earned income to contribute to an IRA). Then they convert the IRAs into Roth IRAs. That sounds complicated but you can do it online, and it��s almost as easy as transferring money from checking to savings. You pay income tax the next April only on any earnings accrued between the time you contributed to the nondeductible IRA and converted to a Roth.

There��s one big caveat to the backdoor Roth: the pro rata rule. When you calculate the taxes due on a conversion, you have to take into account all your IRA assets, not just the new $5,000 nondeductible IRA. For example, if you have a traditional IRA with $95,000 of money from a 401(k) rollover (the $95,000 contributio! ns were made on a pre-tax basis), and you make a $5,000 nondeductible contribution to a new IRA, the conversion would be 95% taxable.

So when might it make sense to skip this whole exercise? Ronald Finkelstein, a CPA and lawyer with Marcum in Melville, N.Y., said he personally makes nondeductible IRA contributions each year and has considered doing a Roth conversion but passed because he has accumulated a large sum in a traditional IRA he opened 30 years ago when he had a newspaper route. Plus, he may retire to Florida, so paying the New York state tax bite wouldn��t make sense. ��You have to do the calculations,�� he warns.

But sometimes it can still make sense for folks, even older folks, with big traditional IRAs, to do the backdoor Roth. Another Huston client, a 68-year-old builder, does them as part of a holistic plan to get more of his net worth into tax-free accounts so he and his wife (and grandchildren) will have the accounts to tap as part of a tax diversification strategy. He just did a $6,000 backdoor Roth for the third year in a row. At the end of each calendar year, Huston and he look at his income and decide how much to convert from his traditional IRA too (one year it was $50,000; one year $25,000), keeping in mind what would push him into a higher tax bracket.

There��s still time to make an IRA contribution for calendar year 2011 through April 17, 2012. You can double up and make your 2012 contribution too. How long should you wait to convert? ��It��s a grey area,�� says Robert Keebler, a CPA in Green Bay, Wisc. He suggests a waiting period of six months, although other advisors say to convert the next day to limit the tax bite on the conversion.



Asia stocks mostly rise as Europe jitters ease

Most Asian markets rose on Friday as successful Italian and Spanish bond auctions and comments from the European Central Bank helped alleviate concerns about the region��s debt crisis.

Mainland Chinese stocks, which tumbled after data showing a drop in fourth-quarter foreign exchange reserves, were a notable exception.

Japan��s Nikkei Stock Average JP:NIK ?jumped 1.4% to 8,500.02, South Korea��s Kospi KR:0100 ?gained 0.6% to 1,875.68, Australia��s S&P/ASX 200 index AU:XJO ?rose 0.4% to 4,195.90 and Hong Kong��s Hang Seng Index HK:HSI gained 0.6% to 19,204.42.

Click to Play

ECB, BOE leave rates unchanged

The European Central Bank left its key interest rates unchanged, pausing after two consecutive rate cuts.

��Overseas equity markets fared quite well because of the sovereign-bond sales in Italy and Spain that saw related bond yields coming down. That helped to ease the fears about the euro debt crisis,�� said Ben Kwong, chief operating officer at KGI Asia in Hong Kong.

On mainland Chinese bourses, the Shanghai Composite Index CN:000001 ?sank 1.3% to 2,244.58, while the Shenzhen Composite Index plunged 3.5% to 845.93. Taiwan��s Taiex XX:Y9999 ! slipped 0.1% to 7,181.54 on caution ahead of Presidential elections over the weekend.

The broad regional gains came as U.S. stocks ended with modest gains Thursday. The euro also appreciated versus the dollar after successful Spanish and Italian bond auctions, reflecting positive investor sentiment. Read more on U.S, equity markets.

European Central Bank President Mario Draghi��s comment that the bloc��s debt markets seem to have stabilized also helped sentiment, strategists said. Read more on ECB meeting.

Several mining and metals shares climbed in Asia after a softer dollar pushed commodity prices higher on Thursday.

Shares of Pacific Metals Co. PFMTF JP:5541 ?jumped 4.5% in Tokyo, Rio Tinto Ltd. AU:RIO RIO ?added 0.7% in Sydney and Korea Zinc Co. KR:A010130 ?climbed 3.6% in Seoul. In Hong Kong, Aluminum Corp. of China Ltd. ACH HK:2600 ?added 2.2% and Maanshan Iron & Steel Co. HK:323 MAANF ?gained 3.5%.


Shares of Inpex Corp. JP:1605 ?IPXHY ?climbed 1.2% after the Japanese energy producers and French partner Total SA FR:FP TOT ?gave the go-ahead to a massive $34 billion Ichthys natural gas-export project in Australia. See report on Inpex-Total approval of Ichthys.

Many of the region��s exporters also climbed, with those in Japan rising as the euro climbed above the 98-yen level. Honda Motor Co. JP:7267 HMC ?rose 3.4% and Sharp Corp. JP:6753 SHCAF closed 2% higher.

Mainland Chinese stocks fell sharply after data showed the country��s foreign-exchange reserves fell by $20.6 billion in the fourth quarter to $3.18 trillion amid a shrinking trade surplus and worries about foreign exchange outflows.

��Analysts will jump to conclude that there must be big capital flight in the fourth quarter,�� Bank of America Merrill Lynch analyst Ting Lu said in a note following the data release, adding that such a direct interpretation might ��overstate the size of capital flight.�� Read more on China's reserves.

Shares of Anhui Conch Cement Co. CN:600585 ?dropped 4.6%, electrical appliances distributor Qingdao Haier Co. CN:600690 fell 4.3% and SAIC Motor Co. CN:600104 ?declined 3.9%.

Some analysts remained optimistic that Beijing will relax its monetary policy stance to support economic growth.

��Markets still have the expectation that the [Chinese] central bank will still lower the reserve requirement ratio either before or after the Lunar New Year,�� said KGI��s Kwong, referring to Chinese holiday which begins this year on Jan. 23.

In Hong Kong, footwear retailer Belle International Holdings Ltd. HK:1880 BELLF ?plunged 6.9% on disappointment over its fourth-quarter same-store sales growth.

Hostess May File for Bankruptcy

Hostess Brands, the seller of Wonder Bread, Ding Dongs, Ho Ho's, Sno Balls, Drakes Cakes and Twinkies, is preparing to file for bankruptcy as soon as this week, according to The Wall Street Journal.

If a filing were to occur, it wouldn't be the first trip through the bankruptcy process for the company, which has made deserts since the 1930s. In 2004, Hostess went bankrupt and stayed in administration for four years until it re-emerged as Hostess Brands in 2009.

Burdened by its liabilities, Hostess reportedly suspended payments on union pensions in December has been struggling to make interest payments on a $700 million loan, The New York Post reports.

The company, which is owned by private equity firm Ripplewood Holdings, is struggling to meet interest payments as investors seek concessions from its near 20,000 unionized employees, according to the Post.

Hostess Brands carries $860 million in debt and millions in additional vendor payments, which jeopardize its $2.5 billion bakeries and deserts-selling businesses.

As Hostess Brands emerged from a 2004 bankruptcy, it fought a 2007 bid from Mexican baked goods giant Grupo Bimbo and Ron Burkle of the Yucaipa Companies.

It exited bankruptcy in 2009 in a deal financed by Ripplewood Holdings, which received a controlling stake in the company for a $130 million capital commitment. General Electric's(GE) GE Capital division, Monarch Alternative Capital and Silver Point Capital also provided hundreds of millions in rescue financing, the Post reports. With a bankruptcy imminent, the company is now arranging $75 million in debtor-in-possession financing from its lenders, according to the Journal.

In 2010, Forbes ranked it the 167 biggest private company in the U.S. and at the time of its bankruptcy exit, the firm staffed 22,000 employees, according! to a pr ess release.

Twinkies, invented in the 1930s by the Continental banking Company, initially had strawberry and banana fillings. During World War II, a shortage and rationing of bananas forced Continental Bakeries to switch the filling to vanilla, a turning point in American junk food lore.

Nearly a half billion Twinkies are reportedly made every year and former President Bill Clinton put a Twinkie in a time capsule, the company says on its Web site.

Twinkie inventor Continental Banking Company had a history that traced back to the 1840s until a 1995 merger with Interstate Bakeries, which then valued the company at $330 million.

The Post reports that with a bankruptcy filing, Hostess Brands could liquidate brands including Hostess, Wonder, Nature's Pride, and Drake's to its lenders.

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Helen of Troy Limited Beats Estimates on Top and Bottom Lines

Helen of Troy Limited (Nasdaq: HELE  ) reported earnings on Jan. 5. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Nov. 30 (Q3), Helen of Troy Limited beat expectations on revenues and beat slightly on earnings per share.

Compared to the prior-year quarter, revenue expanded significantly, and earnings per share expanded significantly.

Margins contracted across the board.

Revenue details
Helen of Troy Limited recorded revenue of $339 million. The three analysts polled by S&P Capital IQ looked for a top line of $319 million. Sales were 65% higher than the prior-year quarter's $205 million.


Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
EPS came in at $1.04. The three earnings estimates compiled by S&P Capital IQ predicted $1.02 per share. GAAP EPS of $1.04 for Q3 were 21% higher than the prior-year quarter's $0.86 per share.


Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 39.3%, 590 basis points worse than the prior-year quarter. Operating margin was 12.3%, 290 basis points worse than the prior-year quarter. Net margin was 9.7%, 350 basis points worse than the prior-year quarter.


Source: S&P Capital IQ. Quarterly periods.

Looking ahead
What does the future! hold?

Next quarter's average estimate for revenue is $289 million. On the bottom line, the average EPS estimate is $0.88.

Next year's average estimate for revenue is $1.2 billion. The average EPS estimate is $3.45.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 75 members out of 101 rating the stock outperform, and 26 members rating it underperform. Among 38 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 22 give Helen of Troy Limited a green thumbs-up, and 16 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Helen of Troy Limited is hold, with an average price target of $29.00.

  • Add Helen of Troy Limited to My Watchlist.

Media Digest 7/16/2010

MarketWatch:?? AgBank rose after its debut on the Hong Kong market.

Reuters:?? Goldman Sachs Group (NYSE: GS) settled with the SEC for $550 million.

Reuters:?? BP plc (NYSE: BP) capped the flow of oil into the Gulf of Mexico.

Reuters:?? Google Inc. (NASDAQ: GOOG) profits missed targets as expenses rose.

Reuters:?? Smartphone sales pushed up results in Q2 for Sony Ericsson.

Reuters:?? A recall of the Apple Inc (NASDAQ: AAPL) iPhone is unlikely.Reuters:?? Problems in Europe and iPhone sales will hurt results of other smartphone companies.

Reuters:?? American Research Group says there is still strong demand for the iPad.

Reuters:?? Carlyle Group will buy NBTY (NYSE: NTY) for $3.8 billion.

WSJ:?? Bank of America Corporation (NYSE: BAC) will focus on consumer banking as the financial reform bill becomes law.

WSJ:?? Citigroup (NYSE: C) disclosed in new public filings how it hid risk.

WSJ:?? Apple? management knew of risks that its iPhone 4 would have reception problems.

WSJ:?? A WSJ survey shows more economists believe that the economy is improving.

WSJ:?? The delivery of the Boeing (NYSE: BA) 787 could be delayed again.

WSJ:?? Honda Motor (NYSE: HMC) was hit by another strike in China.

WSJ:?? Advanced Micro Devices (NYSE: AMD) posted higher sales.

WSJ:?? The auto industry is fighting a new safety bill.

WSJ:?? Activision is gambling $100 million on a PC-based game.

WSJ:?? Congress approved the financial reform bill.

WSJ:?? Fed governor nominees supported policies to drive down unemployment.

WSJ:?? China’s yuan policy has changed very little.

WSJ:?? Bombardier will compete with Airbus and Boeing in the mid-sized aircraft market.

WSJ:?? Johnson & Johnson (NYSE: JNJ) will keep a Tylenol plant shut.

WSJ:?? GlaxoSmithKline (NYSE: GSK) will take a $2.4 billion charge for costs related to problems with several drugs.

WSJ:?? Gannett’s ! (NYSE: G CI) earnings may conceal ongoing problems in the newspaper industry.

WSJ:?? Improved results of Greek debt issues may mark a turnaround in Europe.

WSJ:?? KKR stock fell after its IPO.

NYT:?? Banks are trying to change their business models now that the financial overhaul bill is in place.

Blomberg:?? Buyers of BP assets many face the legal problems that go with them.

Douglas A. McIntyre

2012 Looks Promising for Energy Investors

Rising oil prices and increased demand for oil and natural gas have set the ball rolling for exploration and production for the new year. With oil prices hovering around the $100-per-barrel mark, companies across the world have increased their focus on production. A recent survey by Barclay's Capital showed that major E&P companies have hiked their planned expenditures for 2012, hitting a cumulative figure of $600 billion. This indicates a feverish pitch in E&P activities in 2012 that should rake in moola for the companies and their investors. Read along and I will tell you where well-known energy companies are focusing their budgets in 2012.

The numbers



2011 Capital and Exploratory Expenditures
(in billions)

2012 Estimated Budget (in billions)


ExxonMobil (NYSE: XOM  ) $33-$37 $33-$37 --
Chevron (NYSE: CVX  ) $28.0 $32.7 17%
PetroChina $26.8 $30.0 12%
Royal Dutch Shell $25-$27 $25-$27 --
Total (NYSE: TOT  ) $20 $23 15%
BP (NYSE: BP  ) $19 $20 7%
ConocoPhillips (NYSE: COP  ) $12 $14 17%
Chesapeake (NYSE: CHK  ) $5.0-$5.4 $5.4-$5.8 7%

Company filings, Web sources.

We can see that four of the companies are exhibiting double-digit growth in their budget allocation. A huge portion of the budget is going to go into finding and developing natural gas reserves since the world's energy demand has been witnessing a shift toward it. The emergence of natural gas as the best alternative to the continually depleting oil reserves has pushed oil majors and minors to grab land in newly found unconventional reserves. This has also created enough opportunities for large-cap oil-field-services companies such as Schlumberger (NYSE: SLB  ) , Baker Hughes, Halliburton (NYSE: HAL  ) , and Weatherford, as the unconventional plays require lot of high-tech equipment and severe-site maintenance.

Focus areas
Now let's shed some light on the places the money will go. Projects witnessing increased capital spending are Chevron's Wheatstone and Gordon Australian liquefied natural gas (LNG) projects; the Australia Pacific LNG project, which is a joint venture of ConocoPhillips, Origin Energy, and Sinopec; and Exxon and Interoil's (NYSE: IOC  ) Papua New ?Guinea projects. Apart from being rich in reserves, Australia and Papua New Guinea are well-located to serve Asia, with China and India acting as perfect markets. After the Fukushima Daiichi nuclear disaster in March, Japan has also become a target market for project operators in the region as natural gas is seen as safer than nuclear energy.

Other places drawing oil and services companies are the U.S. shale plays of Bakken, Barnett, Eagle Ford, Woodford and Marcellus. Among them, Bakken has experienced the highest growth in the past five years. According to the U.S. Geological Survey, there are 3.65 billion barrels of recoverable crude oil present in the Bakken. ExxonMobil has 410,000 net acres of leasehold and seven operating rigs in the Bakken. The company has also invested in the Woodford shale.

The oil sands of Canada are also attracting investments from both domestic and international players. The oil sands provide these players a good source of supplying crude oil to the U.S. If TransCanada gets approval for its Keystone XL pipeline, oil sands prospects will brighten up further.

A majority of these projects are scheduled to operate from 2014, with a few adding to production post-2017, and some as early as 2012.

Key drivers
High oil prices are one of the main drivers behind the increased capital spending of oil majors. With oil futures settling between $101 and $110 for WTI and Brent, respectively, oil and gas companies have increased efforts to produce more and cash in on the price rise.

The increased demand for natural gas is another driver persuading companies to add more natural gas assets to their project portfolios. Demand from emerging markets and shale discoveries in Latin America, apart from the proven reserves of the U.S., Qatar, Iraq, and Canada have given enough reasons for energy companies to invest.

Foolish bottom line
Rising oil prices and burgeon! ing natu ral gas demand stand to play a vital role in shaping the energy sector in 2012, and the increased budget of oil players seems worth spending. If you're looking for top energy plays to profit of the oil boom, check out The Motley Fool's "3 Stocks for $100 Oil." You can download this special report for free by clicking here. Stock Report! 8/21/09, ANN, JDAS, RODM, SCD, HUM, YASH Stock Report!

Friday August 21, 2009

Ann Taylor Stores Corporation (NYSE: ANN) today reported results for the second quarter of fiscal 2009, ended August 1, 2009, which reflected a solid gross margin rate, significant expense savings and better-than-anticipated sales at LOFT.

JDA(R) Software Group, Inc. (NASDAQ: JDAS) today reported that in connection with its hiring of Executive Vice President, Sales & Marketing Jason B. Zintak on August 18, 2009, the compensation committee of the Company’s Board of Directors approved equity awards to Mr. Zintak consisting of 50,000 restricted stock units of the Company, one third of which will vest 12 months from the date of hire, with the remainder vesting ratably over a 24-month period commencing 12 months from the date of hire. Mr. Zintak also received 50,000 restricted stock units of the Company, which vest in tranches 45 days following the attainment of certain performance milestones that will be determined within 90 days of the effective date of employment. Additionally, Mr. Zintak’s inducement awards allow him to earn a target performance share award equal to 30,000 shares (up to a maximum of 37,500 shares) of the Company’s common stock, which will be based upon the achievement of the Company’s 2009 annual EBITDA target, as previously established by the Company’s Board of Directors. In the event of a change in control of the Company, the vesting of all outstanding unvested equity awards granted to Mr. Zintak will accelerate as of the date of the change in control unless the acquiring company assumes the equity awards or provides substitute equity awards. These awards! have be en granted outside of the terms of the Company’s 2005 Performance Incentive Plan by the Compensation Committee of the Company’s Board of Directors in reliance on NASDAQ Marketplace Rule 5635(c)(4) as an inducement to Mr. Zintak to join the Company.

Rodman & Renshaw, LLC, a subsidiary of Rodman & Renshaw Capital Group, Inc. (NASDAQ: RODM), today announced that former news anchor for the CBS Evening News, Dan Rather, will moderate “A Conversation” with Dr. Alan Greenspan, former Chairman of the Board of Governors of the Federal Reserve System, at Rodman & Renshaw’s Annual Global Investment Conference. The “Conversation” will open the Annual Global Investment Conference on Wednesday, September 9, 2009 at 8:15 A.M. and cover critical topics facing our global economy.

The replay of the LMP Capital and Income Fund Inc. (NYSE: SCD), conference call, held live on August 11, 2009 at 4:15 p.m. (Eastern Time), is now available. Harry “Hersh” Cohen, Peter Vanderlee and Michael Clarfeld of ClearBridge Advisors discussed the Fund’s recent portfolio manager changes and concluded with a question and answer session.

It wasn’t just the athletes getting exercise at this year’s National Senior Games in Palo Alto, Calif. Over the 15 days of the games, Humana’s (NYSE: HUM) Freewheelin bicycle-sharing program recorded more than 2,400 rides in excess of 11,000 miles. Humana, a leading health benefits company and the presenting sponsor of the Senior Games, teamed with the city of Palo Alto to provide 120 bikes for use during the games.

Yasheng ECO-Trade Corporation (OTCBB: YASH) announced today that it and Yasheng Group, an agriculture conglomerate, have signed a Memorandum of Understanding (”MOU”) with Pfau, Pfau ! & Pf au LLC (”Pfau”) to establish a joint venture to develop and operate three properties currently owned by Pfau, one of which includes roughly 28,000 acres in Central California.

How To Become A Data-Feed Super Affiliate

The program that I manage offers a product feed, and I get a chance to see a sad picture of many good affiliates wasting their potential.

Here is my advice from the affiliate manager's perspective.

Whenever you join (or think bout joining) a program, you need to look for two things:

  • Temporary or permanent opportunities
  • Flaws of a merchant

Here is an example of an opportunity that was created by an outside factor.

Recently, we got removed from the Yahoo index because of a penalty. I have no idea when (or if) we will get included back in, but I do know that it makes one decision much easier for our affiliates.

Judging by the numerous posts on various SEO-related message boards, it looks like Google and Yahoo use very different algorithms to rank pages. So for any given site, you have a choice to make. You can optimize for Yahoo, for Google, or for both.

Since Yahoo and Google use different algorithms, it is going to be hard to optimize the same set of pages for both of those engines at the same time, unless you employ heavy cloaking. And the way I see it, for an affiliate, it is better to appear high on one search engine than to appear low on both of them in an attempt to optimize for different algorithms at the same time.

Imagine that you are one of our affiliates. Given the information I just told you, shouldn't you concentrate on Yahoo for that data-feed site that is being used to promote our products?

Why spend (at least) half of your time and resources on optimizing for Google when you know that we are nowhere to be found in Yahoo?

You have to have an extremely well linked and optimized site to get ahead of the merchant for the exact product-name search terms. The merchant is your biggest obstacle when it comes to the search engine traffic. So if there is a route that lets you get around that obstacle - take it!

Most of our well-performing affiliates did just that. Either intentionally or unintentionally, they e! nded up making much more money by appearing high in Yahoo results, while not being ranked high in Google.

So on a practical side of things, here is what you should do.

For your existing merchants, check if they are removed from the index in any of the major search engines, and if they are, then start reading and implementing SEO tips for that particular engine.

And if you are thinking about joining a program and can't decide between several merchants, then check if any of them is not in the index of either Yahoo or Google. If you find a merchant like that - drop everything else you are doing and jump on that program.

As far as theory goes, this was just a simple, but specific example of what you should look for to make your efforts pay off. There are many different opportunities to get ahead in existing programs with data-feed sites; you just have to look for them.

Now, let's talk about flaws of merchants and how you can exploit them to make more money and help consumers at the same time.

I will give another specific example, but you should be able to apply this concept to many different programs.

Our site has one huge structural flaw: we only list products by product-oriented categories.

In other words, there is no way to navigate our site by a specific occasion or by the purchasing intent of a visitor.

You can follow a path like:

widgets -> wooden widgets -> red wooden widgets

This setup works fine for some type of shoppers, but is a complete turn-off for others.

And the problem is that most affiliates simply mirror the catalog structure of a merchant according to their feed.

But if you structured your site to list widgets as:

  • widgets for birthdays
  • widgets for girlfriends
  • widgets for those who are over 50
  • the Independence Day widgets


then you would attract different type of shoppers. You would no longer compete with the merchant, but instead you would complement them.

! A visito r who is looking for a gift for his 50-something friend and has no idea that a red wooden widget would be perfect, will not travel down the path laid out by our catalog. So if he gets to our home page, we simply lose a sale. And if your data-feed-based site follows the same structure - you lose a sale as well.

Also, since the visitor does not know that he really wants a red wooden widget, he we not use those keywords while searching for a present on the search engines.

But if you attracted that visitor to your site, presented him with ideas for older friends' birthday gifts and guided him to that specific widget's page - then we would make a sale, you would make a commission, and the visitor (turned customer) would get his present with much less searching around. Everyone wins.

Such approach takes more work than simply cloning the merchant's site with a feed, but affiliates who actually do something to complement merchant instead competing with them make a lot more money. After all, if you create a copy of a merchant's site - you are not only competing with the merchant, you are also competing with all of their affiliates that use the same feed in the same way.

Dot Hill Systems Corp. Non Normal Trade in last session - NASDAQ:HILL

Dot Hill Systems Corp. (NASDAQ:HILL) witnessed volume of 8.41 million shares during last trade however it holds an average trading capacity of 482,825.00 shares. HILL last trade opened at $2.69 reached intraday low of $2.54 and went -3.35% down to close at $2.60.

HILL has a market capitalization $146.88 million and an enterprise value at $100.86 million. Trailing twelve months price to sales ratio of the stock was 0.63 while price to book ratio in most recent quarter was 2.37. In profitability ratios, net profit margin in past twelve months appeared at -3.35% whereas operating profit margin for the same period at -2.36%.

The company made a return on asset of -3.33% in past twelve months and return on equity of -12.11% for similar period. In the period of trailing 12 months it generated revenue amounted to $241.69 million gaining $4.50 revenue per share. Its year over year, quarterly growth of revenue was -18.00%.

According to preceding quarter balance sheet results, the company had $46.31 million cash in hand making cash per share at 0.82. The total of $278.00K debt was there putting a total debt to equity ratio 0.43. Moreover its current ratio according to same quarter results was 2.53 and book value per share was 1.14.

Looking at the trading information, the stock price history displayed that its S&P500 52 Week Change illustrated 17.80% where the stock price exhibited down beat from its 50 day moving average with $2.78 and remained below from its 200 Day Moving Average with $2.68.

HILL holds 56.49 million outstanding shares with 55.46 million floating shares where insider possessed 1.21% and institutions kept 39.30%.

3 Stocks That Could Start Dividends in 2012 -

Cisco (CSCO) stock has been a poor performer since the dot-com stock bubble of more than a decade ago. But it's up 14% since last March, when the maker of networking equipment announced it would start paying quarterly dividends.

Also See

  • Go Ahead, Follow the 'Five Days Rule'
  • 10 Stocks Analysts Say to Sell
  • Why U.S. Stocks Could Outperform in 2012

Amgen (AMGN) stock, too, has mostly slumped since the start of 2000. But it has gained 26% since the drug maker said last April that it would also become a dividend-payer.

Expect more cases like these. "Companies are increasingly aware of the premium investors are willing to pay for current income in a yield-challenged world," wrote Jim Morrow, manager of the Fidelity Equity Income fund (FEQIX), in a recent email exchange.

Dividends were a bright spot in an otherwise gloomy market last year. The S&P 500-stock index returned 2.1% including dividends, versus an average over the prior half-century of close to 10%. But a simple strategy of selecting the 50 highest-yielding shares in the S&P 500 returned 18.5% last year, according to Savita Subramanian, a stock strategist with Bank of America Merrill Lynch.

The retirement of the baby boomers, who began turning 65 last year, is likely to increase demand for dividend-paying stocks in coming years, according to Ms. Subramanian.

So which companies among those that don't pay dividends today might soon begin paying them, possibly giving their share prices a boost?

Identifying companies that should pay dividends is the easy part. Any company that consistently generates more cash than it needs for day-t! o-day ex penses is a candidate. Among S&P 500 firms, last year saw 22 payment initiations, the most in more than a decade. But 106 of the 500 index members still pay nothing, and record cash balances suggest some of these companies will announce new dividends this year.

Sorting companies that will pay from those that merely should is more difficult. If Cisco and Amgen are any indication, poor past stock performance is a good predictor. Perhaps shareholder patience with non-payers runs out when their stock prices stop rising.

I ran a recent screen for companies that sit on excess cash today and generate yearly free cash from operations equal to at least 5% of their stock market values -- enough to easily support a 1% to 2% dividend yield. That turned up companies like Apple (AAPL) and Bed Bath & Beyond (BBBY), but their shares have gained more than 20% apiece over the past year, giving investors little to gripe about. While both make good dividend candidates, neither likely feels pressured to pay. (And whereas Apple sits on a preposterous amount of cash, Bed Bath holds a more reasonable sum, considering its small Buy Buy Baby chain is thriving and growing fast.)

Ebay (EBAY) seems a likelier bet. The company has spent billions of dollars on acquisitions and share repurchases in recent years, but although its stock is up over the past year, it has changed little over the past seven. S&P 500 companies currently pay out just 29% of their profits as dividends; the average since 1977 is 46%. If eBay were to pay 29% of its projected 2012 profit, its shares would yield 2.1%.

Dell (DELL) has authorized enough money for share repurchases to buy around one-quarter of its outstanding stock. Shares at $16 apiece have lost more than 40% of their value in a decade. A payout of 29% of profits would give the stock a yield of 3.8%. As for the existing cash stockpi! le, abou t 80% of it is held offshore for tax purposes, estimates James Ragan, an analyst with Crowell, Weedon & Co., an investment bank. A dividend for Dell would therefore become more likely in the event of new legislation allowing companies to repatriate cash at reduced tax rates, reckons Ragan.

GameStop (GME) stock has lost around half its value in four years. Its sales growth has slowed but its profits remain strong and the video game retailer recenty paid off its debt. "This reinforces out confidence that the company will contemplate a dividend sometime in the near future," wrote Arvind Bhatia, an analyst at investment bank Sterne Agee, in a Monday research note. Shares would yield 3.4% if the company paid 29% of its profit as dividends.

Of course, these and other companies may view share repurchases as a better way to return cash to shareholders. Repurchases reduce the number of shares outstanding, thereby increasing earnings per share and, theoretically at least, making shares more valuable. One clear advantage of repurchases is that they don't trigger investor taxes, while dividends generally do.

But dividend rates are typically set ahead of time, and repurchase rates are not. For companies, that's a lure to spend the most on shares in years when profits are fat -- and share prices, accordingly, are high. The financial crisis of 2008 and 2009 demonstrated that when the market plunges, most companies continue paying their dividends, but nearly all stop buying back stock. Ultimately, the choice may come down to investor preference. If dividend-paying shares continue soaring, more companies will want to pay.

Of course, all of this hinges on what happens next with dividend taxes. The dividend tax rate for U.S. investors is currently capped at 15%, but the cap is set to expire at the end of this year. Without an extension, next year's dividend tax rates will range from 15% to over 39%. A higher rate would surely dampen investors' recent enth! usiasm f or dividends, and possibly hurt the share prices of big payers. A long-term extension of low rates, however, could convince more companies to pay.

EU Iran Oil Sanctions Likely to Be Phased In Over Time, Official Says

A European Union embargo on Iranianoil will probably be phased in to protect countries with thegreatest reliance on imports from the country, according to anEU official familiar with the talks.

EU foreign ministers are likely to agree to block Iranianoil imports at a meeting in Brussels on Jan. 30, and workinggroups are negotiating the details of how the embargo will beimposed, said the official, who declined to be identifiedbecause the talks are private.

Countries with the biggest dependence on Iranian oil,including Italy, Greece and Spain, have raised concerns over howexisting contracts should be treated when the embargo isimposed, the official said. Phasing in the sanctions would helpto ensure that Iran, rather than the European countries, losesout as a result of the embargo, he said.

France, Germany and the U.K. are taking the lead in pushingfor the embargo to increase pressure on Iran over its nuclearprogram, the official said, adding that it has the support inprinciple of all 27 member states. Western countries allege thatIran��s nuclear-development plans are aimed at building atomicweapons. Iran says they are for civilian purposes and togenerate electricity.

Europe��s sanctions threat and an Iranian demand that U.S.warships stay out of the Persian Gulf have stirred new tensionsbetween Iran and the West, contributing to higher energy prices.Crude oil traded in New York for February delivery was at$102.23, up 42 cents, at 12:46 p.m. London time, heading for aweekly gain.

Debts to Eni

Italian Prime Minister Mario Monti has said that an embargoshould exempt crude sold by Iran to pay off debts to Rome-basedEni SpA (ENI), Italy��s largest oil company.

��An oil embargo is conceivable as long as it remainsgradual and excludes the deliveries that serve to reimburse thebillion of euros in debts that Iran owes to Eni, our nationalcompany,�� Monti told France��s Le Figaro newspaper in aninterview published yesterday.

Italy gets 13 percent of its imp! orted cr ude from Iran,Monti said, making it more sensitive to a supply shock thanother European countries. France taps Iran for only 3 percent ofits oil imports, he said.

Greece, which relied on Iran for 14 percent of its oilimports in the first half of 2011, according to the U.S. EnergyDepartment��s Energy Information Administration, has decided toabide by any curbs after blocking them last month, an officialat the Greek Environment, Energy and Climate Ministry said onJan. 3 on condition of anonymity.

The U.S. tightened its Iran sanctions on Dec. 31 and ispushing the EU to follow suit.

The Iranian Revolutionary Guard Corps will hold large-scaleexercises in the Strait of Hormuz and the Persian Gulf nextmonth, the state-run Fars news agency reported today.

The New SEC: Not The Domineering Type

From AAO Weblog

A few years ago, the SEC used to have "We are the investor's advocate" plastered in various prominent spots of its website – like the home page, for instance.

No more. The SEC has become kinder and gentler, it seems, with bigger interests than just advocating for investors. I mentioned Commissioner Paul Atkins' speech last week, the one where he continued to bash Section 404 costs while praising efforts at making Auditing Standard 2 less onerous. I forgot to mention this snippet:

"The SEC is very concerned about maintaining our capital markets as an attractive place for investors to invest. In fact, we are charged by Congress to look after not only investor protection, but also competition and efficiency of the financial marketplace and ease of capital formation. We must ensure the integrity of our markets so that investors have confidence that they will be treated fairly. At the same time, our regulations must not price those very investors out of our markets through burdensome regulations or eat up the fruits of their investments through nonsensical mandates."

"Charged by Congress to look after not only investor protection but also competition and efficiency of the financial marketplace and ease of capital formation?" Well, yes. And he's right; it's in black-and-white in the 1933 Act. But the 1933 Act presents it in a slightly different tone:

"Whenever pursuant to this title the Commission is engaged in rulemaking and is required to consider or determine whether an action is necessary or appropriate in the public interest, the Commission shall also consider, in addition to the protection of investors, whether the action will promote efficiency, competition, and capital formation." [Emphasis added.]

Notice what comes first: the protection of investors. The rest is secondary. Commissioner Atkins' statement sounds like he's channeling the Bloomberg/Schumer report or the Paulson Committee report ! more tha n echoing William O. Douglas. This reference to Douglas comes from a 1995 speech by Arthur Levitt:

"One of my predecessors, later Supreme Court Justice, William O. Douglas described our special role in this way: "We've got brokers' advocates; we've got exchange advocates; we've got investment banker advocates; and we are the INVESTOR'S advocate.""

Maybe the pendulum hasn't swung completely the opposite way from the reform era after Enron – but it feels like it's almost there. I offer this list of "Top Ten Signs the Pendulum Has Swung" compiled by David Katz at so you can at least get a good laugh out of the current deregulatory folly.

Everything You Need to Know About Tomorrow's OPEC Meeting

Crude dropped for the second straight day yesterday (Tuesday) after Saudi Arabia made it clear that the Organization of the Petroleum Exporting Countries (OPEC) will leave its production targets unchanged at its meeting tomorrow (Thursday). Crude oil for November delivery fell 54 cents a barrel - or 0.7% - to finish at $81.67 a barrel on the New York Mercantile Exchange yesterday. Even with yesterday's decline, oil prices are up 11% over the past 12 months.

Speaking in advance of tomorrow's OPEC meeting in Vienna, Saudi Oil Minister Ali al-Naimi said that prices between $70 and $80 a barrel are "ideal," and noted that the market is "very well-balanced" right now. In a related development, Sanford C. Bernstein & Co. LLC slashed its oil-price forecasts for both next year and 2012, and attributed the new viewpoint to big stockpiles.

But this only provides you with part of the picture. And it'll lead you to the wrong conclusions.

So here's the proverbial "rest of the story" - including everything you need to know about tomorrow's OPEC meeting.

What OPEC is Really Thinking

OPEC wants to keep the price of oil below $100 a barrel. Above that level there is genuine concern that the price will discourage the global economic recovery and thereby create problems for oil sales. But that's the Catch 22 quandary OPEC isn't talking about: Once the global economy revs up, this genie gets out of the bottle and futures contracts will send oil prices well above the $70 to $90-a-barrel price range that the cartel prefers.

In other words, lower prices now guarantee higher prices later. That's the insight we're going to profit from.

Wilson Pastor is Ecuador's minister for non-renewable natural resources, and a very capable fellow. We have worked together on the refinery project I advise down there.! In capi tal city Quito, given the country's declining oil production, prospects for the global market are very important.

Well, Ecuador also happens to be one of the 12 members of OPEC, the Organization of Petroleum Exporting Countries. And Wilson just happens to be OPEC's new president.

As it celebrates its 50th birthday, the oil cartel is demonstrating some of the strains developing in the oil market. Still, it can sometimes be very subtle in its reading of the oncoming situation.

What Wilson says has an impact on your investment plans in energy.

However, unlike market misgivings in the past, this has less to do with fears that OPEC might cut production, and more to do with what the cartel sees for the global market moving forward.

The main conclusion is pointing in a very different direction.

OPEC's Stealth Move

In recent weeks, attention once again turned to tomorrow's OPEC meeting in Vienna - and the usual uncertainties from TV's talking heads over whether the cartel will cut production.

The really important move, on the other hand, has gone almost unnoticed.

In terms of tomorrow's meeting, we've been telling Energy Advantage readers for weeks that there was no chance that OPEC would change its production quotas at that meeting - or, for that matter, at the special meeting set to take place in Quito in December. All of OPEC's projections point toward the price of crude remaining between $75 and $85 a barrel for the rest of this year.

That means that the cartel can effectively balance production and return without resorting to market manipulation.

OPEC has left its output ceiling unchanged for almost two years: In December 2008, the group announced a record supply curb of 2.2 million barrels per day to combat lower demand and prices. That is hardly likely to change this time around.

Anyway, OPEC has not actually tried to directly dic! tate pr ices for some time. Rather, it relies on careful prognosis of demand levels and then attempts to set its production accordingly.

The cartel estimates what it will pump by first estimating worldwide demand, then forecasting non-OPEC extractions, and, finally, by subtracting the second from the first and establishing what is called the "call on OPEC."

Lastly, OPEC determines production quotas for each of the 12 member nations.

Those quotas are voluntary, and overproduction has occurred. However, the countries have learned (sometimes the hard way) that consistently ignoring the quota will risk bringing additional Saudi production into the market as enforcement, thereby driving down the price (as occurred in the mid-1980s).

Compliance is now running at about 53%, indicating that some of the members are choosing to exceed their production allotments. The reason: They are still running budget deficits from the depressed prices that held sway during the financial crisis and are trying to make up lost ground.

OPEC officials are now publicly saying that greater adherence to the quotas is necessary to maintain the organization's overall position - a clear sign of growing concerns over its members maintaining a common approach.

There are grounds for such concerns. Because the real news has been almost buried.

Surprise! Demand is Actually ... Rising

OPEC has quietly increased its overall global demand projection for 2011. And for the first time in three years, it also raised the forecast for its own supply requirements to meet that demand.

With a greater amount of the global daily oil coming from non-OPEC sources, the organization cannot dictate market direction, as it did in the past. Yet controlling 40% of the total still gives it the greatest clout.

The increase - 1.2% - may not sound like much at first. But that boost indicates that expected worldwide daily demand has increased to 86! .4 mill ion barrels. And there are indications now emerging that, before long, this projection may need to be increased again.

The translation: The cartel sees demand coming back and prices going up.

Now the official line - for example, in yesterday's statement by al-Naimi, the Saudi oil minister - would have us believe that supply and demand are "very well balanced" and that current prices in the $80 range should hold. Yet government contacts in members Kuwait and the United Arab Emirates are privately estimating prices well north of $100 by this time next year. And some at the OPEC Secretariat (the cartel's administrative arm at the headquarters in Vienna) are planning for rises more quickly and to higher levels.

The logic is straightforward.

Whether you adopt a figure of $80 or one well in excess of $100, there is now a consensus inside OPEC that overall global demand is returning.

That will drive up the price of oil without OPEC having to do a thing.

Some members - Venezuela and Iran, for example - would like to see that price increase as quickly as possible. Venezuela's Oil Minister Rafael Ramirez said on Sept. 14 that $100 is now a justified price.

Saudi Arabia, on the other hand, usually takes a more cautious approach. Capital city Riyadh believes that a persistently high price will prompt greater U.S. and European interest in alternative energies while at the same time increasing the risk of government intervention in importing countries - two developments that would cut into OPEC sales.

But the force propelling the rise is no longer coming from the developed counties - usually referred to as the OECD states. This is the Organization for Economic Cooperation and Development, creator of the Paris-based International Energy Agency (IEA) and an organization that was established to counter OPEC.

This spike in energy demand has already returned in Asia and Africa, leading to upward revisi! ons in b oth OPEC and IEA figures.

OPEC projections now acknowledge that the economic recoveries are also under way in both North America and Western Europe. And that means the traditional markets for oil will also be increasing. Ecuador's Pastor advises that the instability in the market will be increasing and the overall price levels along with it.

As a result, Pastor does not see any plans to change OPEC output quotas. The market dynamics will establish a price floor in the current range of $75 to $85 a barrel, with upward pressure moving in going forward.

And that means the strategy we are setting out is square on.

Remember, the rise in futures contracts (the "paper" barrels) will occur in advance of a spike in market prices for the actual crude (the "wet" barrels). [Note: For a more-detailed explanation of this relationship, read about the oil-futures bubble in "How the Little Guy Will Fix Oil Futures," which appeared in my Oil & Energy Investor newsletter back in March.]

In short, all the forward indicators are pointing toward a rise in prices. The only question is this: How quickly will we see the increase in full-blown demand?

Ecuador's Pastor and OPEC are merely the latest market movers to tell us this.

Actions to Take: We've been telling our readers - both here in Money Morning and in our affiliated publications - for some time that we believe oil prices would ultimately head higher.

And investors could well see some of the catalysts start to come together this week - a busy one for energy investors. With the close at $81.67 yesterday, crude for November delivery is down about 3% from the five-month high of $84.43 it reached last week. Brent crude for November settlement on London's ICE Futures Europe exchange fell 22 cents, or 0.3 percent, to $83.50 a barrel. !

The U.S. Department of Energy is scheduled to release last week's petroleum data in Washington at 11 a.m. tomorrow (Thursday). That's a day later than usual because of yesterday's Columbus Day holiday.

The industry-funded American Petroleum Institute will report its numbers today (Wednesday).

With demand on the increase, oil prices are clearly headed higher - despite what other energy-sector mavens would have investors believe.

Here's how we respond.

Given our belief that prices will rise, the objective is twofold:

  • Assemble a portfolio containing the stocks of individual companies in the extracting, field-service, and processing segments of several different portions of the global energy sector.?
  • At the same time, look to deploy exchange-traded funds (ETFs) and exchange-traded notes (ETNs) that will benefit from the advancing price of oil and other energy sources.
  • For investors seeking more-detailed guidance on specific stocks, ETFs and ETNs that will benefit from the trends we've detailed here, consider The Energy Advantage, the advisory service run by Dr. Moors.

Beijing Flexes Financial Might to Turn Costa Rica Against Taiwan

Should you rent or buy a home? How much should I tip the delivery person? Will money make me happy?

Ask ten different people, and chances are you��ll get ten different answers. Those are the type of questions where everyone seems to have their own opinion or philosophy.? That��s exactly what makes them a great fit for��s new feature, Mint Answers.

We launched Mint Answers a few weeks ago to give consumers a platform to voice their personal finance and investing questions. Since then, hundreds of you have asked �C and many more have chimed in with responses. (At Mint Answers, your questions are answered by experts, as well as by other community members like you.)

Below are three of the most popular questions for the past week. Find and ask (or answer) more at

Rent or buy a home?

Every day I read blogs about this sort of thing and there are pros and cons of both. With the housing market where it is today, which do you advocate?

1. There are aspects of this question that go well beyond the financial, but purely in terms of money, you can’t beat the New York Times’s buy vs rent calculator. In my market, it says rent. Yours may vary.

2. Oh man, I may be the only financial blogger here that wants to go BACK to renting…Financial costs aside, it really messes with your freedom. When you own a place you can’t just pick up and move whenever you feel like it – or if worst case you lose your job.

If you’re totally cool with settling down in one spot for 4+ years, then disregard this comment.? But if you’re a roamer/military kid, then really THINK about this before you sign away…there’s no shame in renting at all ;) ? And you can still build up your net worth in plenty of other ways too.

3. [You're] not the only one :) ! We are currently selling our house so that we can rent. We consider owing anyone money a burden that we do not wish to partake in anymore.

We are not making this decision without a plan though. Starting in 2011 our 4-5 year plan to save money to buy the house we want to live in will begin. When I say buy I mean the 100% down plan.

Renting for 5 years is not the worse thing one could do, especially when the reward is a paid for house. When your house is paid for there is not a recession anywhere that will render you homeless. (Unless you don’t pay your taxes that is.)

My answer is: Rent until the purchase of a home, whether with debt or not, is a blessing. (If you have an emergency fund with at least 6 months of expenses set aside, have an additional 20% to avoid PMI ,and buy well within your means it will be more of a blessing than a burden. It’s also not a bad idea to save yourself a lot of money by getting a 15 year mortgage instead of a

More answers to this question>>

What do you normally tip for food delivery?

We ordered Indian food the other night and the bill came out to $35…my instinct said to tip $5, but then I wondered if take out is different than, say, sit-down service.? Twitter friends came in with $3-$8 — I ended up tipping $6. Am I crazy?

1. I usually tip 20% no matter what but I used to work in a restaurant. ?I haven’t typically used a flat rate to tip.

2. For delivery, I usually tip 10% to 15%. If it’s a small order, I’ll tip a higher percentage because the delivery person still had to make a trip out. I tip towards 20% if the food is still warm when it gets to my apartment.

3. I tip $3, standard, for anything under $20, and $4 for anything over $20, with an extra $1 for particularly fast service or for?inclement weather.

More answers to this question>>

Will money make me happy?

1. If money ! has the ability to truly make people happy, how come there are so many miserable rich people?

It’s a question that requires more clarification. Money is often attributed as causing happiness, but only because it allows one to afford either necessities or luxuries of life. You would be hard pressed to find someone happy with bricks of gold if they were stuck on an island like Tom Hanks in Castaway.

I met a man once who was a multi-millionaire while I was working for a top US Bank. He was trying to leverage some of his real estate for more real estate. This man was 80 years old, and even though he had more money than he knew what do with, he was still trying to build wealth through deals as he did in his youth. He explained to me that even though he was well-off now, he was only really happy when he was making deals, working hard, and risking for a greater prize. Not exactly the picture of contentment.

In the end, you can’t take it with you. You won’t be lying on your death-bed thinking about stock quotes and the previous year’s rate of return. Money is a great tool. But it is a fleeting tool that more people have made themselves unhappy over than have become rich.

2. If you have no money and are struggling with every day needs, money will make you much happier. If you have some money and get more money, the money will probably make you a little happier, but not nearly by the margin that it did before. If you are a billionaire and you just got another billion, you might be happier because you are now another billion ahead of other billionaires, but I’d venture to say that happiness is fleeting. But what do I know. I have no billions. ;)

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Vestas Jobs Threat Pressures Obama to Extend Tax Break

Vestas Wind Systems A/S (VWS)��s threat tofire 1,600 workers in the U.S. undermines President BarackObama��s goal of creating green jobs and adds to pressure onCongress to extend a tax credit that the industry relies on.

The world��s biggest maker of wind turbines said yesterdayit will probably reduce its staff beyond the 2,335 posts it��seliminating worldwide if the U.S. doesn��t renew the so-calledProduction Tax Credit, which expires at the end of this year.

��We will evaluate it during 2012 depending entirely on howthe political situation evolves,�� Chief Executive OfficerDitlev Engel said in an interview in Copenhagen. U.S. jobs willbe scrapped ��for sure�� without the credit, and a decision isdue ��no later than the fourth quarter,�� he said.

Obama took office three years ago pledging to generate jobsin the wind and solar industries, and calling in January 2011for a ��Sputnik moment�� to wean the U.S. off fossil fuels.Since he came to power, carbon cap-and-trade legislation stalledand lawmakers attacked backing for solar manufacturer SolyndraLLC, which filed for bankruptcy in September.

Vestas shares have fallen almost 10 percent in two days andwere down 2.8 percent to 56.85 kroner ($9.80) at 11:15 a.m. inCopenhagen today. Short positions in the company, or bets thatthe stock may fall, rose to 20.6 percent on Jan. 11, accordingto the most recent figures from Data Explorers Inc., a record ina series that goes back to July 2006.

Industry Concern

The Vestas warning adds fuel to the wind industry��s pleasfor lawmakers to extend the credit, which grants an incentiveworth 2.2 cents a kilowatt-hour of wind power.

Continuing the tax credit is needed to avoid the boom andbust cycles of the past in the U.S., where the wind industryemploys more than 75,000 people, according to the American WindEnergy Association, a lobby group. Wind power growth is alsothreatened by natural gas prices, which fell almost a third lastyear as production from shale formations r! eached a record.

��The production tax credit is incredibly vital to the,�� Jacob Pedersen, an analyst at Sydbank A/S (SYDB) whocorrectly predicted the scale of the Vestas cuts, said in aphone interview from Aabenraa, Denmark. ��If it isn��t there, noone will invest. If you don��t get the tax credit, the return oninvestment is lower.��

Tax Credit

The last time the production tax credit, or PTC, wasallowed to expire, at the end of 2003, U.S. annual windinstallations declined, to 397 megawatts in 2004 from 1,670megawatts the previous year, according to AWEA data.

Vestas said 182 workers in the U.S. were included in itscurrent round of reductions, about 7.8 percent of the totalcuts. Most of the employees affected will be in Europe.

��Ultimately, if the U.S. does withdraw PTC support, thenVestas will commercially have no choice�� other than firingworkers, Charlie Thomas, a London-based fund manager withJupiter Asset Management Ltd., which owns Vestas shares, said bye-mail. ��The boom/bust scenario the industry saw in 2003/4 onthe same issue was clearly unhealthy for the wind turbinemanufacturers then, as it would be now.��

Another incentive, the U.S. Treasury Department��s 1603 cashgrant program, expired Dec. 31. It offered as much as 30 percentof development and construction costs for renewable energyplants, and had paid out $9.6 billion through October to supportmore than 22,000 projects. Developers said funding for cleanenergy projects will fall this year without the 1603 program.

Threat to Developments

Letting the PTC expire this year will similarly threatennew development, Denise Bode, chief executive officer ofWashington-based AWEA, said in an e-mailed statement.

The ��Vestas announcement shows the danger to U.S.manufacturing jobs if Congress waits any longer to extend theproduction tax credit,�� she said. ��With stable tax policy thewind industry can grow to nearly 100,000 American jobs in thenext four years and support 500,000 Ameri! can jobs by 2030.��

Engel said that the tax credit ensured that the wind sector��got going�� in the U.S., and that its expiration will hurt theturbine maker��s clients.

��It��s not us who gets the PTC, it��s our customers,�� Engelsaid. ��I��m sure a lot of them are very dependent on the PTC.��

Vestas has spent more than $1 billion building fourfactories in Colorado, and it has more than 3,000 employeesacross the U.S. according to Engel. He said it would be��wrong�� to say Vestas will close down its U.S. plants.

Engel��s Assessment

��What we would do would be to ramp them down because theUnited States market has been coming and going,�� he said. ��I��mabsolutely certain that the U.S. market will come back again,but maybe not in 2013.��

U.S. new installations declined in 2010 to 5,116 megawattsfrom 9,996 megawatts a year earlier, according to AWEA.Bloomberg New Energy Finance estimates that 2011 installationstotaled 7,300 megawatts. U.S. installations may grow to 8,000megawatts this year before dropping to 5,500 megawatts in 2013.

��The U.S. market has turned into a huge disappointment forVestas and other wind turbine manufacturers who invested heavilyin that market a few years ago when growth prospects seemedstrong and turbines were in short supply,�� said Justin Wu, aHong Kong-based analyst with New Energy Finance.

��Now U.S. wind installations are in decline due tocontinued policy uncertainty and factories are becoming idle asa result,�� Wu said.

From discount to luxury, these retailers can keep paying off

Picking retailers during a recession is a difficult proposition, considering winners have come out of every part of the spectrum — discount, luxury, you name it. At the same time, there’s plenty of losers — just look at the recent bankruptcy of Syms (PINK:SYMSQ) and its Filene’s Basement unit, which shows not even discount retailers are guaranteed a pass during hard times.

I watch more than 5,000 publicly traded companies with my Portfolio Grader tool, ranking companies by a number of fundamental and quantitative measures. This week, I’ve got six various retail stocks to buy.

Here they are, in alphabetical order. Each one of these stocks gets an ��A�� or ��B�� according to my research, meaning it is a ��strong buy�� or ��buy.��

99 Cents Only Stores (NYSE:NDN) is a ��dollar store��-type retail stock. Like many other discount retailers, NDN has had a successful 2011, up 37%. NDN stock gets a ��B�� for earnings momentum and a ��B�� for the magnitude in which earnings projections have increased over the past month in my Portfolio Grader tool. For more information, view my complete analysis of NDN stock.

Dollar General (NYSE:DG) is a discount retailer with stores in 35 states. DG stock has had a strong year-to-date return of 33%. DG stock gets a ��B�� for operating margin growth, a ��B�� for earnings growth, a ��B�� for the magnitude in which earnings projections have increased during the past month and a ��B�� for return on equity in my Portfolio Grader tool. For more information, view my complete analysis of DG stock.

Dollar Tree (NASDAQ:DLTR) operates discount variety stores that offer merchandise at the fixed price of $1. Shareholders have been pleased by the retail stocks return of 46% in the past 12 months. DLTR gets a ��B�� for operating margin growth, a ��B�� for earnings growth, a ��B�� for the magnitude in which ear! nings pr ojections have increased during the past month and an ��A�� for return on equity in my Portfolio Grader tool. For more information, view my complete analysis of DLTR stock.

Dillard��s (NYSE:DDS) is a retailer of apparel and home furnishings. For 2011, DDS has posted a gain of almost 19% compared to smaller gains by the broader markets. DDS stock gets an ��A�� for operating margin growth, an ��A�� for earnings growth, an ��A�� for earning momentum, an ��A�� for its ability to exceed the consensus earnings estimates on Wall Street, a ��B�� for the magnitude in which earnings projections have increased over the past month and an ��A�� for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of DDS stock.

Macy��s (NYSE:M) operates retail stores under the names Macy��s and Bloomingdale��s. Year-to-date, M stock is up 26% compared to a gain of just 4% for the Dow Jones. M stock gets an ��A�� for operating margin growth, an ��A�� for earnings growth, an ��A�� for its ability to exceed the consensus earnings estimates on Wall Street, a ��B�� for the magnitude in which earnings projections have increased during the past month, an ��A�� for cash flow and an ��A�� for return on equity in my Portfolio Grader tool. For more information, view my complete analysis of M stock.

Nordstrom (NYSE:JWN) is a retail chain that offers apparel, shoes, cosmetics and accessories for women, men and children. JWN rounds out the list with a return of almost 17% year-to-date. JWN gets a ��B�� for operating margin growth and an ��A�� for return on equity in my Portfolio Grader tool. For more information, view my complete analysis of JWN stock.

Get more analysis of these picks and other publicly traded stocks with Louis Navellier��s Portfolio Grader tool, a 100% free stock rating tool that measures both quantitative buying pressure and eight fundamental factors. Stock Report! 8/20/09, BNHNA, JNJ, AGYS, EAG, BSET, ESE Stock Report!

Thursday August 20, 2009

Benihana Inc. (NASDAQ: BNHNA; BNHN), operator of the nation’s largest chain of Japanese theme and sushi restaurants, today formally announced its Benihana Teppanyaki Renewal Program at its 2009 Annual Meeting of Stockholders. The 2009 Annual Meeting of Stockholders was held at the Marriott Doral Golf Resort and Spa, 4400 NW 87th Avenue, Miami, Florida 33178 at 10:00 a.m. ET this morning.

Johnson & Johnson (NYSE: JNJ) generated attention in the options pits on Wednesday, as traders responded to a mixed bag of news surrounding the firm. On the one hand, the Food & Drug Administration (FDA) issued a warning letter regarding JNJ’s antibiotic studies; on the other, the blue chip won a U.S. advisory panel’s support for its experimental hip implant.

Agilysys, Inc. (NASDAQ: AGYS), a leading provider of innovative IT solutions, announced the availability of the third chapter in an eBook from Agilysys which examines how virtualization is quickly becoming a standard in the Data Center as a tool to redesign computer infrastructures and eliminate inefficient systems.

American Defense Systems, Inc. (NYSE Amex: EAG), a leading provider of advanced transparent and opaque armor, architectural hardening and security products for Defense and Homeland Security, reported its physical security subsidiary, American Physical Security Group, LLC (”APSG”), has received “Qualified Anti-Terrorism Technology” designation and certification from the U.S. Department of Homeland Security (DHS)! for its American Anti-Ram(TM) (AAR(TM)) vehicle barricade product line.

Bassett Furniture Industries, Inc. (Nasdaq:BSET) today announced that its triennial accounting review by the Securities and Exchange Commission (SEC) is close to being completed. As previously announced, Bassett had received comment letters from the Commission during the second and third quarters of 2009, relating to Bassett’s Form 10-K for the year ended November 29, 2008 and Form 10-Q for the quarter ended February 28, 2009. Due to the potential implications of these comments, the Company delayed its filing of its Form 10-Q for the quarter ended May 30, 2009.

ESCO Technologies Inc. (NYSE: ESE) today announced that TekPackaging LLC (Tek) has been awarded a production contract to be the exclusive manufacturer of Thermoscan(R) ear thermometer probe covers for distribution worldwide. Thermoscan is the market leader and healthcare industry standard for electronic thermometers.

These Underdogs Are No Dogs

Short-sellers and hedge funds may be shadowy, but sometimes they are the smartest guys in the room. They've done their homework, and they're willing to bet their capital against the crowd -- an investing strategy that can be as lucrative as it is contrarian.

On Motley Fool CAPS, we've also got leading analysts who find the chinks in a company's armor and correctly call its fall. Our "Underdogs" have earned 100 or more CAPS points by correctly predicting that one or more stocks would underperform the market. However, we're going to focus on the stocks these top members expect will outperform the market. If these CAPS investors have scored big by correctly predicting which stocks will fail, it may be worth our while to see which others they think will succeed.


Member Rating


CAPS Rating
(out of 5)

chk999 100.00 Becton, Dickinson (NYSE: BDX  ) *****
bbmaven 99.99 Ebix (Nasdaq: EBIX  ) *****
cecamadocv1 100.00 Freeport-McMoRan (NYSE: FCX  ) ****

Source: Motley Fool CAPS.

Not every short sale goes as planned, making shorting a risky proposition. Stock prices can be irrational longer than you have money to stay in the game. So don't use this as a list of stocks to sell or buy -- just the launching pad ! for furt her research.

Searching for a solution
A rare strain of the H1N1 swine flu virus -- the H1N2 case is only the second one ever -- isn't the start of a pandemic, but is a cause for concern as viruses that mutate significantly can lead to just such an outbreak.

Medical device maker Becton, Dickinson was a beneficiary of the mass hysteria from the swine flu outbreak in 2009, and H1N1 revenues swiped 2 percentage points from the results. However, it still produced solid earnings that topped comps in every quarter this year.

Diagnostic segment revenues rose nearly 4% in the fourth quarter, an outcome defying LabCorp's (NYSE: LH  ) results that came up short of analyst revenue estimates. Quest Diagnostics also saw its profits plunge 13% in the quarter.

CAPS member THemler thinks international expansion is key for Becton, and looks for it to be able to sort out the best avenues for growth:

Bought BDX both as short-term defensive & long-term growth prospect. The upside/downside ratio is favorable at current levels. Company is well positoned to grow in emerging markets, but must adjust product costs to truly compete. I'm betting on BDX management to figure it al out and resume their historic consistant growth.

Add Becton, Dickinson to your watchlist and see if it's able to diagnose its own troubles in time.

Inquiring minds want to know
Despite lingering doubts about its financial propriety, insurance business software specialist Ebix continues to ride a wave of support higher, up nearly 50% from the lows hit back in September. Shares are still a third lower than their 52-week highs, however, suggesting investors are still a bit cautious.

Despite being a?low-profile company, Ebix is the premier exchange business operator, with fingers in markets like life insurance and annuities, employee benefits, and property and casualty insurance.! Yet it' s also using a?risky growth-by-acquisition strategy, making it difficult to get a real handle on its abilities. Revenues last quarter rose 28% and profits were slightly lower as a result of a one-time gain of $3.9 million associated with the E-Z Data put options it acquired. JDA Software (Nasdaq: JDAS  ) hasn't had as strong results, nor has Amdocs.

All those acquisitions have helped fuel Ebix's growth, but CAPS All-Star pstoimenov recently commented about being suspicious about management's ability to acquire companies that are always immediately accretive to earnings:

I wonder why nobody questions the skill of the Ebix team. They acquire tens of businesses and they are immediately accretive to their returns. This means that 1) either EBIX managment is awesome and they buy businesses at well below intrinsic value or 2) something fishy is going on.

Indeed, even its most recent acquisition, HealthConnect Systems, was identified as such. Let us know in the comments section below or on the Ebix CAPS page if management is really that good at finding undervalued opportunities. Then add the software seller to?your watchlist?to see how it plays out.

Can't touch this!
As global financial jitters cause gold, silver, and other precious-metal prices to remain elevated or rise, miners are going to seek expansion opportunities to produce ever greater amounts. And as they do so, they're going to run into greater opposition. Northern Dynasty Minerals (NYSE: NAK  ) has run aground in Alaska as a result of its attempt to develop the world's largest undeveloped copper-gold-molybdenum deposit, Newmont Mining (NYSE: NEM  ) was forced to keep closed its Conga project in Peru after locals sabotaged equipment, and Freeport-McMoRan reduced its forecasts for gold and copper as a resu! lt of a strike at its Grasberg mine.

Whether it's communities standing athwart efforts to dig or workers wanting a bigger piece of the pie, as companies seek to enrich themselves on the riches buried in the ground, these types of actions will likely grow in number.

Yet the locals and workers need these companies, which is why CAPS member davfoo believes Freeport is offering an excellent buy-in price: "The developed and emerging economies need these commodities. FCX is big, has a reasonable p/e of 10 and pays a modest dividend."

You can tell us on the Freeport-McMoRan CAPS page?or in the comments section below if you think this is just a temporary impasse, and then follow along by adding it to the Fool's free portfolio tracker.?

There's no need to fear...
Underdogs often shine brightest with their backs against the wall. Still, it takes more than a few All-Star picks and a quick paragraph to make buy or sell decisions. Start your own research on these stocks on Motley Fool CAPS, where your opinion can still save the day. While there, you can read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from a stock's CAPS page.