U.S. Justices Weigh Limits to Cellphone Searches by Police

Jacquelyn Martin/AP WASHINGTON -- U.S. Supreme Court justices Tuesday appeared to seek a compromise over whether police officers need warrants to search cellphones. In two hours of oral arguments before the court, the justices appeared sympathetic to the need of police officers to quickly search phones when a suspect is arrested but were also wary of privacy concerns raised by the amount of personal data now kept on mobile devices. The court indicated it could issue a ruling that says police might need a warrant in some circumstances but not in others. It was unclear what rationale the court would embrace. One possible outcome would be for a search not to require a warrant so long as the evidence in question was directly related to the criminal investigation. Several justices appeared concerned about granting the police unfettered access to the vast amount of information contained on smartphones. "People carry their entire lives on cellphones," Justice Elena Kagan said. On the other hand, Justice Anthony Kennedy noted that criminals have embraced new technology, which has enabled them to be "more dangerous, more sophisticated, more elusive." The nine justices are weighing cases from California and Massachusetts arising from criminal prosecutions that used evidence obtained without a warrant from a judge. The legal question rests on whether the Fourth Amendment to the U.S. Constitution, which bars unreasonable searches, requires police following an arrest to get court approval before a cellphone can be searched. The two defendants challenging their convictions, David Riley and Brima Wurie, say evidence found on their phones shouldn't have been used as evidence at trial because the searches were conducted without warrants. Should the court limit the scope of what police can search without a warrant, both men could still lose as the searches in their cases may still not need a warrant. Rulings are expected by the end of June. The cases are Riley v. California, 13-132 and U.S. v. Wurie, 13-212.

Which Way Does Panera Go From Here?

With shares of Panera Bread Co. (NASDAQ:PNRA) trading at around $183.74, is PNRA an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock's Movement

While most companies throughout the broader market are finding ways to cut costs, Panera plans on adding locations. This is a good sign as it indicates the company is confident in its future prospects. As most special eatery diners already know, Panera is known for its freshness, local ingredients, and atmosphere (WiFi included).

If you have ever walked into a Panera during lunchtime, then you know it's very crowded. And the afternoons attract people who want to work while enjoying a snack and/or beverage. The slowest time of day is dinner, which is why Panera is attempting to offer more at this time. Panera is especially trying to make a move with pasta. While there is potential, ordering pasta at Panera is akin to ordering a filet mignon at a diner. In other words, it's probably not a good idea. There's also a good chance that most diners have better local options for pasta than Panera. That said, don't knock it until you try it, right?

NEW! Discover a new stock idea each week for less than the cost of 1 trade. CLICK HERE for your Weekly Stock Cheat Sheets NOW!

Okay, enough about pasta. Pass or fail, pasta isn't going to be a determining factor for Panera. Looking at the big picture, Panera has grown revenue and earnings on an annual basis, and it still has a ton of growth potential domestically and internationally. Other positives include margin expansion and quality debt management. However, perhaps the most important factor of all is that Panera is now an established household brand name in the United States. As far as analysts go, they love the stock: 17 Buy, 8 Hold, 1 Sell.

There are a few negatives for Panera, which include missed earnings expectations, slightly slowing comps growth, and a lowered full-year comps growth expectation to 4.0%-5.0% from 4.5%-5.5%. There is also no yield.

Now let's take a look at some numbers. The chart below compares fundamentals for Panera, Starbucks Corporation (NASDAQ:SBUX), and Chipotle Mexican Grill (NYSE:CMG). Panera has a market cap of $5.34 billion, Starbucks has a market cap of $46.41 billion, and Chipotle has a market cap of $11.19 billion.

	PNRA	SBUX	CMG
Trailing   P/E	29.86	31.50	39.22
Forward   P/E	22.49	23.66	28.45
Profit   Margin	8.22%	10.80%	10.36%
ROE	23.18%	28.97%	23.75%
Operating   Cash Flow	$298.51 Million	$2.55 Billion	$515.84   Million
Dividend   Yield	N/A	1.40%	N/A
Short   Position	4.90%	1.40%	16.30%

 

Let's take a look at some more important numbers prior to forming an opinion on this stock.

E = Equity to Debt Ratio Is Strong   

The debt-to-equity ratio for Panera is stronger than the industry average of 0.90.

	Debt-To-Equity	Cash	Long-Term Debt
PNRA	0.00	$323.00 Million	$0
SBUX	0.10	$1.70 Billion	$549.60 Million
CMG	0.00	$507.50 Million	$0

 

NEW! Discover a new stock idea each week for less than the cost of 1 trade. CLICK HERE for your Weekly Stock Cheat Sheets NOW!

T = Technicals Are Strong   

Panera has performed exceptionally well over a three-year time frame. It's also one of the few stocks that held its own during the financial crisis. This doesn't mean it would hold up just as well if a similar situation were to present itself, but it's worth noting.

	1 Month	Year-To-Date	1 Year	3 Year
PNRA	3.70%	15.70%	16.84%	145.00%
SBUX	7.60%	16.40%	13.61%	153.50%
CMG	9.90%	21.18%	-11.62%	174.10%

 

At $183.74, Panera is trading above all its averages.

50-Day   SMA	171.26
100-Day   SMA	166.22
200-Day   SMA	163.96

 

E = Earnings Have Been Strong            

Earnings and revenue have consistently improved on an annual basis. Earnings have increased for 10 consecutive years.

	2008	2009	2010	2011	2012
Revenue   ($)in   billions	1.30	1.35	1.54	1.82	2.13
Diluted   EPS ($)	2.22	2.78	3.62	4.55	5.89

 

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

	3/2012	6/2012	9/2012	12/2012	3/2013
Revenue   ($)in   millions	498.58	530.59	529.34	571.55	561.78
Diluted   EPS ($)	1.40	1.50	1.24	1.75	1.64

 

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

T = Trends Might Support the Industry

Panera is known as a healthier option than McDonald's Corp (NYSE:MCD) and Yum! Brands (NYSE:YUM) restaurants. With the consumer more health-conscious than in past years, this has helped Panera as well as other healthy eating establishments. McDonald's has been offering more healthy options, which has helped it as well.

The problem for Panera is price. If the consumer weakens, which seems to be likely, then many consumers might choose cheaper alternatives. On the other hand, Panera offers atmosphere, and many consumers are willing to pay a little extra for atmosphere.

NEW! Discover a new stock idea each week for less than the cost of 1 trade. CLICK HERE for your Weekly Stock Cheat Sheets NOW!

Conclusion

Now that Panera has become a mainstream American brand with millions of loyal customers that enjoy one of the most casual and comfortable atmospheres available,  it's a long-term OUTPERFORM. However, a tentative consumer, a somewhat poor valuation, and an artificially-inflated stock market are reasons for caution.

2 Health Care Stocks Rising on Big Volume

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

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

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

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

Alkermes

Alkermes (ALKS) is engaged in developing, manufacturing and commercializing medicines designed to yield better therapeutic outcomes and improve the lives of patients with serious diseases. This stock closed up 2% to $33.63 in Monday's trading session.

Monday's Volume: 3.14 million

Three-Month Average Volume: 1.51 million

Volume % Change: 98%

From a technical perspective, ALKS trended up here and broke out above some near-term overhead resistance at $34.30 with heavy upside volume. This move also pushed shares of ALKS into new 52-week-high territory, since the stock hit an intraday high of $34.74.

Traders should now look for long-biased trades in ALKS as long as it's trending above $31.50 and then once it sustains a move or close above Monday's high of $34.74 with volume that hits near or above 1.51 million shares. If we get that move soon, then ALKS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $40 to $43.

Actavis

Actavis (ACT) is a global, integrated specialty pharmaceutical company engaged in developing, manufacturing and distributing generic, brand and biosimilar products. This stock closed up 1.3% at $134.48 in Monday's trading session.

Monday's Volume: 2.44 million

Three-Month Average Volume: 1.76 million

Volume % Change: 59%

Shares of ACT spiked modestly higher on Monday after Leerink upgraded the stock to outperform from market perform, citing valuation and confidence in the company's ability to beat earnings expectations. The firm raised its price target to $155 from $133.

From a technical perspective, ACT trended up here and broke out above its 52-week and three-year highs at $133 with above-average volume. This breakout is coming off a major base and consolidation pattern for shares of ACT, since the stock had previously been trending range-bound between $118.68 on the downside and $133 on the upside.

Traders should now look for long-biased trades in ACT as long as it's trending above $130 or $128 and then once it sustains a move or close above its new 52-week high at $135.99 with volume that's near or above 1.76 million shares. If we get that move soon, then ACT will set up to enter new 52-week- and three-year-high territory, which is bullish technical price action. Some possible upside targets off that move are $140 to $145, or even $150 to $155.

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

-- Written by Roberto Pedone in Delafield, Wis.

Saks Investors Make Out Like Inept Bandits

For a company that is putting up solid sales growth, has a great brand, and has seen its stock price rise more than 40% in the last 12 months, Saks (NYSE: SKS  ) didn't demand much of a premium. Hudson's Bay, the operator behind Lord & Taylor, picked up Saks for just $16 per share, representing a 4.5% bump to Friday's closing price.

Why is this good news?
It seems like an odd move from Saks' point of view. Hudson's Bay posted a loss in its last quarter, while Saks put up a nice profit in its most recent period. Hudson's Bay also has almost no cash on hand to finance the transaction. The business had about $27 million in cash at its last reporting in May, and it's going to finance the acquisition with equity, debt, and secured notes.

You know what, speaking of the word "acquisition," let's call this what it really is -- a merger. Saks has a larger market capitalization, and while Hudson's Bay runs substantially more locations, it only barely edged out Saks in total revenue last quarter.

Management on both sides was eager to spin the big win for Saks shareholders. The closing price represented an "approximate 30% premium to the May 20, 2013 closing price, the day before media speculation began." So really, Hudson's Bay was making Saks an offer it would have been crazy to refuse.

Never mind that Saks put up a 5.9% increase in year-over-year comparable sales last quarter, or that its operating income margin was 8.6% in the same quarter. Surely the business will find some great inspiration from Hudson's Bay, which managed a 4% increase in comparable sales -- with Lord & Taylor experiencing a 1.4% decline -- and a loss at the operational level. Maybe some of that difference is that Saks is managing $436 of annual revenue per square foot, while Hudson's Bay's combined brands are running under $200.

So why is this good news?
The benefit for Saks is, actually, that Lord & Taylor isn't as good. Saks is still managing some stores in those malls that no one goes to anymore -- you know, the 90% hat stores mall that still has that cookie place -- and it's expensive to break out of all the leases and shut the places down. Now, it can swap out a lower-end store with a fancy name for the Saks locations, taking less of a hit on the revenue and cost sides.

The combined company could also create a real estate investment trust, using the flagship locations under its umbrella. Saks' New York City flagship alone is valued at more than $800 million. So there's plenty of room for investors to be hopeful about new real estate opportunities.

But what I think is the best bit of news is that Saks gets 40 days to seek better bids. If I were running the place, it would be selling chocolate and board games -- oh, and I'd go look for a better company to join up with. Hudson's Bay may be the best offer out there right now, but it's simply uninspiring. Saks management can -- and should -- do better.

Saks isn't the only retailer on the cusp of a big change. In fact, the entire retail space is in the midst of the biggest paradigm shift since mail order took off at the turn of last century. Only those most forward-looking and capable companies will survive, and they'll handsomely reward those investors who understand the landscape. You can read about the 3 Companies Ready to Rule Retail in The Motley Fool's special report. Uncovering these top picks is free today; just click here to read more.

Dow Down 25 as Caterpillar Stock Drags on Market

Wall Street is doing that thing again. You know, when good economic news sparks a sell-off because investors worry the news is too good? When the data is too good, the theory goes, it gives the Fed more reason to ease up on the money printing. And what can be better for stocks than constant money printing? That line of thinking was partially responsible for today's pullback on the heels of new-home sales in June, which grew at the highest rate in more than five years. 

That said, there was a modicum of more straightforward logic behind today's slump: Dow Jones Industrial Average (DJINDICES: ^DJI  ) component Caterpillar (NYSE: CAT  ) issued a gloomy outlook for the coming year and disappointed on earnings. The Dow ended with 25-point, or 0.2%, losses, closing at 15,542.

As for the index's outperformers, Hewlett-Packard (NYSE: HPQ  ) ended atop the index, gaining 1.5% Wednesday. It's the third straight day of gains for the stock since its 4.5% slump on Friday, when Microsoft's dismal quarter punished HP, an innocent bystander to Microsoft's woes. Today, however, shareholders would be rewarded by the success of a tech peer, as Apple's earnings beat essentially lifted the entire technology sector.

American Express (NYSE: AXP  ) , like HP, posted a large single-day loss last week and is beginning to claw its way higher this week. The stock added 1.3% today, as Fitch Ratings shared what must have been a relieving insight for American Express shareholders. The reason the stock suddenly dropped last week was due to rumors of an EU Commission proposal that would cap interchange fees on card transactions. Today, the draft proposal was officially unveiled, and the ratings agency said the regulations would only minimally affect AmEx's profitability.

Bank of America (NYSE: BAC  ) lost 1.5% today, despite the fact that its board of directors approved a regular $0.01 quarterly dividend payment to common stock shareholders. You'd think investors would be jumping for joy with that guaranteed penny-a-quarter cash flow, but apparently that didn't cut it. It may be because the bank also just agreed to sell a total of 28 branches in New York and Pennsylvania to two smaller banks, reducing its exposure to important markets.

Lastly, the Dow laggard of the day, Caterpillar, shed 2.4% as earnings cratered 43% in the second quarter. Worst of all, the company hinted that poor financial performance was likely to continue with low commodities prices and decelerating Chinese growth combining to paint a bleak picture for the machinery giant. Not helping the situation were fresh numbers suggesting Chinese manufacturing is on the decline.

Cisco to Acquire Sourcefire in $2.7 Billion Deal

IT company Cisco (NASDAQ: CSCO  ) has agreed to acquire cybersecurity software company Sourcefire (NASDAQ: FIRE  ) , the companies jointly announced today.

The proposed transaction calls for Cisco to pay $76 per share in cash for each Sourcefire share and assume Sourcefire's outstanding equity awards for a total price of approximately $2.7 billion. The per-share price represents a 29% premium over Sourcefire's Monday closing stock price. Sourcefire shares jumped $16.71, or 28%, to $75.79 in morning trading.

"Sourcefire aligns well with Cisco's future vision for security and supports the key pillars of our security strategy.  ... [W]e have a unique opportunity to deliver the most comprehensive approach to security in the market," said Hilton Romanski, VP Cisco corporate development, in a statement.

Sourcefire founder and CTO Martin Roesch was quoted in the press release as saying, "Cisco's acquisition of Sourcefire will help accelerate the realization of our vision for a new model of security across the extended network."

Cisco and Sourcefire will continue to act as separate companies until the deal is closed, which is expected to happen in the second half of 2013. At that time, Sourcefire employees will join the Cisco Security Group. The Columbia, Md.-based Sourcefire has more than 650 employees deployed worldwide. Cisco is headquartered in San Jose, Calif. Sourcefire was founded in 2001 and completed its IPO in 2007.

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

link

IPO Roundup: 3 companies fall in their debut

NEW YORK (AP) — A trio of newly public companies had a rough first day on the stock market Friday, joining the broader market sell-off. Shares of all three companies that had their initial public offering Friday fell.

Of the three, app maker Viggle dropped the most at 28%. The other two companies, which include a blood test developer and a stent maker, were down as much as 9%.

Here's a look at how the companies fared:

LOMBARD MEDICAL

The maker of blood vessel stents raised $55 million after pricing 5 million shares at $11 per share. At the end of March, the Irvine, Calif., company expected to raise between $54.5 million and $65.5 million by offering 3.6 million shares priced between $15 per share and $18 per share. The company plans to use the case raised to hire more people in the U.S. and for stent development. Shares of Lombard are trading on the Nasdaq exchange under the symbol "EVAR." They fell $1, or 9.1%, to close at $10.

QUOTIENT

The blood test developer raised $40 million after pricing 5 million units at $8 per unit, which includes a warrant to buy 0.8 of each share within 30 days for $8.80 per share. The units are trading on the Nasdaq exchange under the symbol "QTNTU." The units will be delisted 30 days after the IPO and shares will begin trading under the symbol "QTNT." Earlier this month, the company expected to price shares between $14 and $16, but lowered the price twice. The Edinburgh, Scotland-based company plans to use the money raised to convert a facility in Switzerland it recently rented to manufacture its products. Quotient's units fell 55 cents, or 6.9%, to close at $7.45.

VIGGLE

The New York company makes an app for mobile phones and tablets that rewards users for watching TV shows or listening to music. Users get points that they can collect and redeem for store discounts, gadgets or T-shirts. It makes money through advertising. The company raised $35 million after pricing nearly 4.4 million shares at $8 per share. In March, the! company expected to raise $50 million by offering 2.1 million shares at $23.50 per share. Viggle plans to hire more people and pay down debt with the money it raised. Shares of Viggle are trading on the Nasdaq exchange under the symbol "VGGL." They fell $2.25, or 28.1%, to close at $5.75.

The 5 Best Stocks to Buy Around $5

Popular Posts: 5 Dividend Stocks Yielding More Than 5%9 Cheap Stocks to Buy Now for $10 or Less10 Cheap Stocks to Buy Under $10 Recent Posts: The 5 Best Stocks to Buy Around $5 7 Big-Name Tech Stocks to Plug In Now 5 Dividend Stocks Yielding More Than 5% View All Posts

Finding a good investment for around $5 is not an easy task.

After all, most publicly traded stocks with a low share price got that bargain valuation by running into trouble — as in, enjoying a share price of $10 or $20 several years ago and now trading at a deep discount thanks to pessimistic investor sentiment.

However, shrewd investors can find some good stocks to buy in the Wall Street bargain bin if they know where to look.

While the following stocks are admittedly a bit risky and have some issues, they all are established companies that are worth more than $300 million and are at worst breakeven. That means these bargain stocks to buy have no risk of going bankrupt anytime soon … even if they have admittedly faced some challenges in the last few years.

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Best Stocks to Buy for Around $5: Advanced Semiconductor Engineering (ASX)

Advanced Semiconductor Engineering (ASX) builds and distributes integrated circuits and other electronics. While that's not as sexy as other chipmakers that play to mobile, it's still a good business, considering the general demand for microchips in everything from cars to computers to TVs.

The Taiwan-based company is close to many Asian electronics manufacturers. And regardless of whether those manufacturers crank out something as hot as the iPhone from Apple (AAPL), ASX still will have a strong baseline simply because of how many high-tech devices exist in the world.

Moreover, ASX is not a chip designer, just a manufacturer. That means while it doesn't have the same big margins as the companies who create the next hot chip, it also doesn't have the same risk to get it right with R&D. Advanced Semiconductor's diverse business makes it a stable player for the long haul, and not as finicky as companies that rely heavily on laptops an desktops. That stability also is reflected in the form of a 3% dividend yield.

In a post-PC age, there are assuredly sexier tech plays out there. But ASX is up 35% in the last year and about 20% YTD. With a decent dividend, decent revenue and profit growth and momentum for share prices, ASX could be the best stock to buy for around the $5 mark right now.

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Best Stocks to Buy for Around $5: Aeropostale (ARO)

Specialty retailer Aeropostale (ARO) certainly wouldn't be categorized as a growth stock. The company has seen stagnant revenue for some time, and is currently operating in the red.

But after crashing over 60% in the last year, the collapse in ARO stock might now be a bit overdone. Sure, margins were pinched and sales have gone nowhere … but Aeropostale is on track to return to profitability this year as it closes about 50 stores in 2014 and might close more than a hundred more after that.

Furthermore, let's not act like ARO is alone. Many teen retailers including Gap (GPS) and Abercrombie & Fitch (ANF) have been hit by a horrible group of negative pressures in the last few years that include:

Weaker consumer spending thanks to the Great Recession Continued growth in e-commerce and declines in mall traffic Changing fashion tastes away from bigger brands, and big-time competition from smaller players

This undoubtedly has created challenges, but ARO is right-sized for the current environment and all the negativity has been priced in. Investors who buy this $5 stock now could see a big pop once the stock returns to profitability in a few quarters, and continued improvement on employment and spending data could bode well for retail sales across the board.

An added sweetener: There are rumors of an Aeropostale buyout by private equity to unlock value through cost cutting and restructuring. That certainly would come at a premium, perhaps at $7 or $8 a share, and result in a quick but substantial pop to any shareholders.

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Best Stocks to Buy for Around $5: Hercules Offshore (HERO)

Oil stocks haven't really been all that kind to investors over the last few years as weak pricing coupled with weaker energy demand in emerging markets has hurt the bottom line.

But one area of the energy sector worth looking at is offshore oil drillers, including leader Hercules Offshore (HERO). While oil prices are soft, the bottom line is that the world's easy oil is gone and energy companies are increasingly turning to harder-to-access offshore oil and gas fields in order to bolster reserves … and that means big business for servicers like HERO.

Now, Hercules’ stock price sits at roughly half of its 2013 peak and has run into trouble since its largely shallow-water business hasn't been booming. But the company divested a number of barge-based rigs in 2013, and is about breakeven right now.

While it's unlikely that we will see a surge in oil prices leading to a surge in drilling contracts, the good news is that HERO appears to be right-sized now for the current market environment and has decent upside potential if investment in oil and gas drilling stays strong.

After a big drop during the past few years, much of the negativity has been priced into the energy sector broadly and this sub-$5 stock in particular.

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Best Stocks to Buy for Around $5: Office Depot (ODP)

While the office supply game surely isn't what it used to be thanks to e-commerce and online orders, there is hope for fallen giant Office Depot (ODP).

Office Depot merged with the struggling OfficeMax last year, which will generate big cost savings in the coming year; in 2014, the company is expected to return to profitability once more.

Look, nobody is impressed by ODP’s performance in the last few quarters. Consider this quote from Office Depot CEO Roland Smith in February after bad quarterly numbers: "While (fourth-quarter) results were clearly disappointing, they shouldn't be a big surprise." Furthermore, Office Depot warned that it expects sales to decline in 2014 as it restructures and closes underperforming stores.

The Office Depot-OfficeMax merger, however, changes the story here. The company is still battered based on its past history, and trading at a deep discount to its future sales and profits. Consider that ODP has about $1 billion in cash on hand and won't see most of its debt come due until 2019, giving it a pretty nice cash cushion.

The downside in Office Depot appears limited now that the office space has consolidated and the pressures of e-commerce have been baked in. A secular recovery could increase hiring and business spending, and result in better sales for ODP as a result.

This still is a risky $5 stock, to be sure, but the worst does appear over for Office Depot.

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Best Stocks to Buy for Around $5: Gramercy Property Trust (GPT)

Gramercy Property Trust (GPT) is a real estate investment trust that manages mainly industrial and office properties across the U.S. As of last year, GPT controlled more than 110 buildings with about 4.2 million square feet of office space and 1.5 million square feet of industrial space.

Right now, GPT is struggling to break even on the heels of five new property acquisitions in 2013. However, in March, GPT paid its first dividend since 2007, so things are looking up.

Compared with other REITs, the roughly 3% yield isn't amazing … and besides, you have to annualize the 4-cent payout and trust it's going to be there in the coming quarters. Also, shares are down about 7% so far in 2014 despite the reinstated payouts.

However, a recovery in the broader U.S. economy could lift demand for business real estate and result in bigger revenue and profit for GPT.

If you're looking for a cyclical way to play the recovery and want to get in on a good long-term dividend investment, Gramercy Property might be among the best stocks to buy right now.

GPT stock is down about 80% from its 2007 peak, and its dividends remain a fraction of past payouts.

Still, even if Gramercy only gets part of the way back to where it was several years ago, investors will be rewarded handsomely.

Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor's Guide to Finding Great Stocks. As of this writing, he did not hold a position in any of the aforementioned securities. Write him at editor@investorplace.com or follow him on Twitter via @JeffReevesIP. 

3 Reasons Why Google Will Shine Tomorrow

Google (NASDAQ: GOOG  ) is gearing up to report quarterly results tomorrow afternoon, and it's easy to be worried.

The stock hit a new all-time high this week, fueling expectations that may be hard to live up to tomorrow. Smaller rival Yahoo! (NASDAQ: YHOO  ) posted disappointing growth metrics yesterday. Analysts also see Google growing its earnings per share by less than 7%, possibly questioning if Google is really worth 20 times this year's projected profitability.

Well, don't fret. Let's go over a few reasons why Big G may come out of this just fine.

1. Yahoo! isn't Google
Yahoo! may have set a dreary tone for online advertising yesterday afternoon by posting an 11% slide in display advertising revenue. However, Yahoo! has been marching to its own beat for years, and thankfully for Google it's not the same as what the online advertising leader is playing.

Yahoo! also posted an 8% decline in cost-per-click -- excluding Korea -- but made it up in volume with a 21% spike in the number of clicks. Now that is a trend that we've seen at Google in recent quarters, but this is really a more damaging indicator for Microsoft (NASDAQ: MSFT  ) than it is for Google. Microsoft's Bing is the one powering Yahoo!'s paid search, and it naturally doesn't have the pricing power and breadth that Google commands globally. Since Microsoft takes a 12% cut of Yahoo!'s action here, that is the company that may be following Yahoo!'s lead when it reports tomorrow.

(Yes, Google and Microsoft both report tomorrow.)

2. Google beats more often than not
For a company that doesn't provide guidance, Google has historically found a way to land ahead of Wall Street forecasts.

It's not perfect, but Google has posted better-than-expected earnings in three of the past four quarters. In a welcome trend, its biggest beat came just three months ago when it landed 9% ahead of the analyst average.

So, sure, analysts are only targeting net income per share to climb by a mere 7% tomorrow -- but the smart money has to be betting on something slightly better. 

3. Don't underestimate the innovator that Big G has become
A lot of people see Google as the top dog in search and online advertising, but the dot-com darling is more than just that. Let's not even talk about Android, where Google's mobile platform is the world's mobile operating system of choice for smartphones (and to a lesser extent, tablets).

Google has become a game changer in some pretty unexpected ways. From wearable computing with its Google Glass to broadband connectivity with Google Fiber, this is a company that's thinking way outside of the search box.

Recent chatter has tied Google to rolling out a nationwide Web-based TV service, pushing to commercialize its self-driving car technology, and even introducing an Android-propelled video game console.

Google probably won't use its earnings call to officially announce that it's entering new niche markets, but innovation is clearly in its DNA. It wouldn't surprise anyone if it did spring some ambitious goals for expanding its bar-raising creations, leading analysts to broaden their perspectives for what's possible here.

Google's next war may be in your living room
The television landscape is changing quickly, with new entrants disrupting traditional networks. The Motley Fool's new free report, "Who Will Own the Future of Television?" details the risks and opportunities in TV. Click here to read the full report!

Ex Wal-Mart CEO gets $140M in deferred pay

Departed Wal-Mart CEO Mike Duke's deferred pay should provide enough money to shop beyond discount retailers for many years.

Duke, who retired Jan. 31, had $140.1 million in deferred compensation at year's end, Wal-Mart said Wednesday in its annual proxy filing. That's more than $27 million over what Duke had accumulated in retirement accounts in 2013, when governance experts noted that was more than 6,000 times greater than what the average Wal-Mart employee had stashed in 401K retirement accounts.

Duke's fiscal 2014 compensation dropped more than 70% to $5.6 million from $20.7 million in the prior fiscal year, mostly due to the absence of a stock award.

Duke gained another $17 million from vested shares and nearly $2.9 million exercising previously awarded stock options.

Duke, 64, had been CEO since February 2009 and previously oversaw Wal-Mart International and Wal-Mart U.S. Before joining the company, Duke was with the Federated and May department store chains.

Wal-Mart has noted that Duke had been with the company since 1995 and that his deferred pay and compensation was tied both to a competitive marketplace and his length of service.

Duke's successor, C. Douglas McMillon, saw his compensation soar to $25.6 million from $9.5 million. The bulk of Millon's gain came from a $23 million stock grant. Wal-mart said the grant is tied to Millon's promotion and payouts tied to three years of corporate performance metrics.

Wal-Mart shares gained about 7% during the last fiscal year, lagging the Standard & Poors 500 Index, which gained 32%. Under Duke's five-year watch, shares rose nearly 60%.

Follow Strauss @gbstrauss.

Many low-wage workers not protected by minimum wage

President Obama supports a Senate bill that would gradually raise the $2.13 an hour wage base for tipped workers to 70% of the full minimum wage.

NEW YORK (CNNMoney) President Obama's push to raise the federal minimum wage to $10.10 an hour, coupled with recent state-level increases, is welcome news for many people getting by on small paychecks.

But not every low-wage worker has to be paid the minimum wage.

That's because a crazy patchwork of rules and exemptions lets employers pay some kinds of workers below the full minimum wage -- in some cases, well below.

The rules are complex at the federal and state levels. But here's a partial list of how they treat certain classes of workers.

Disabled workers: Under federal law, employers may apply for a special certificate to pay less than the minimum wage to anyone "whose earning or productive capacity is impaired by a physical or mental disability, including those relating to age or injury."

The rule was established in 1938 and has hardly changed since. It was originally intended to encourage businesses to hire veterans with disabilities in an industrial economy, according to the National Disability Rights Network.

But today it's used primarily to employ disabled people in what are called sheltered workshops that often involve some form of manual labor -- such as packing boxes, doing laundry or printing t-shirts.

An estimated 400,000 disabled people hold such jobs. And their hourly pay is based on the employer's assessment of their productivity relative to the productivity of non-disabled workers.

Groups like the National Disability Rights Network and the American Association of People with Disabilities contend that the subminimum wage rule is out-of-step with today's economy and disabled workers should be ! paid at least the prevailing minimum wage.

Anyone working for very small businesses: Under federal law, an employer doesn't have to pay the minimum wage to a worker if the company's annual gross sales are less than $500,000 and if it doesn't do any business across state lines, according to Tsedeye Gebreselassie, a staff attorney at the National Employment Law Project.

Teenage trainees: Federal law allows employers to pay $4.25 an hour -- $3 less than the current federal minimum -- to anyone under 20 for the first 90 days of employment, according to the Congressional Research Service.

Maryland, which just increased its state minimum wage to $10.10, now exempts those under 20 for the first 180 days, during which employers are allowed to pay them 15% less than the state minimum.

Federal law also lets employers pay 85% of the federal minimum (or $6.16/hour) to full-time students working in retail or service businesses, in an agricultural occupation, or at an institute of higher education.

They are also allowed to pay just 75% of the minimum wage (or $5.44/hour) to students who are employed part-time as part of a vocational training program at an accredited school.

Tipped workers: Currently, under federal law, employers only need to pay tipped workers a minimum wage of $2.13 an hour -- if that wage plus the tips push the worker's pay to at least the $7.25 federal minimum.

But those who advocate for higher wages for tipped workers say that provision is very hard to enforce with employers.

A bill that the Senate is likely to consider next week would raise the federal minimum to $10.10 and also gradually raise the $2.13 minimum for tipped workers to 70% of the federal minimum.

Among states, there's a hodgepodge of rules.

  The road to! a minimu! m wage

Seven states require employers to pay tipped workers the state's full minimum on top of any tips those workers receive, according to NELP.

In at least 24 other states, companies must pay tipped workers a subminimum wage that is higher than the $2.13 required at the federal level.

But even where that's the case, there can be wrinkles. For instance, even though Maryland increased its state minimum wage, it did not raise tipped workers' base hourly wage of $3.63. Instead it chose to freeze it at that level.

That's a step back, according to the Economic Policy Institute's David Cooper. Why? Because previously, Maryland had mandated that tipped workers' base wage be set at 50% of the state minimum, which is now set to gradually increase to $10.10 from $7.25.

Some agricultural employees: Workers who are immediate relatives of an agricultural employer do not have minimum wage protection at the federal level, nor do some other agricultural workers with certain hours and job duty requirements.

Practically, this exemption usually applies only to very small family farms. The vast majority of farm workers are covered under minimum wage laws, NELP's Gebreselassie said.

Home care aides: Until now, home care workers who are hired primarily to dress, feed, bathe and otherwise attend to an infirm person's daily needs at home typically haven't received federal minimum wage protection.

But that will change on Jan. 1, 2015. Under a new set of rules governing "companionship services," home care agencies must pay such aides at least the full minimum wage. If the aide is employed solely by a private household, they may still be exempt from minimum wage protection but only if their primary duties fall within a much narrower definition of companion services.

Other exempt workers: Other groups exempt from federal minimum wage protection include newspaper delivery people, occasional babysitters, employees of small circulation newspapers, those e! lected to! state and local government offices (and their staffs); and anyone who works for some seasonal businesses such as amusement parks and summer camps.

Did Apple Buy Its Own Chip Plant or Not?

Despite a resurgence of rumors and clues that Apple (NASDAQ: AAPL  ) has finally inked a chip manufacturing partnership with Taiwan Semiconductor, the Mac maker could be looking into arguably its biggest move toward vertical integration yet.

SemiAccurate reported last week that Apple has "bought into" a fab, or chip fabrication facility, in "not a trivial way." That would allow the company to reduce its reliance on third-party manufacturers for one of the most important components in its devices. Apple had previously offered TSMC sizable investments to guarantee dedicated capacity, only for the company to politely decline in order to maintain flexibility.

AppleInsider originally thought maybe United Microelectronics was involved; CNET followed up and believes that the deal instead involves Apple partnering with GlobalFoundries, potentially with a sizable investment. Apple and GlobalFoundries are supposedly testing out the latter's new $6 billion plant in New York, and SemiAccurate still thinks that Apple is purchasing a piece of one of GlobalFoundries' plants.

As it stands, Intel remains the only domestic chip maker that still makes its own chips, while virtually every other company has shifted toward a fabless model to reduce capital expenditures. That's one of Intel's key advantages, and one that Apple could potentially enjoy if it were to make such a move.

Instead, Piper Jaffray analyst Gene Munster thinks it makes more sense for the company to focus its efforts on developing chip processes instead of owning and operating a full-fledged factory. Working on just the process technology would only cost around $2 billion, much cheaper than the $5 billion to $7 billion. By only developing the process technology, Apple could turn around and license this process to other foundries to help cover its costs.

Munster also speculates that Apple could potentially acquire IBM's process development division, which is rumored to be up for sale. Apple currently co-develops process technology with Samsung, which is partially why it's taken so long to transition chip production away from the South Korean giant. Going it alone would further distance Apple from its biggest competitor.

Apple's business has become quite capital intensive recently, as expenditures have skyrocketed in recent years. That's also led to greater depreciation expense, which has pressured gross margins. Owning a fab would add to both of those departments, but it would be worth it.

Perhaps this is what Apple was referring to when it said its new semiconductor teams "have ambitious plans for the future."

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

Is College Worth the Debt? More Consumers Say No

Whatever their feelings on higher education, fewer consumers think the sometimes-massive loans incurred to get it are worth the trouble.

A report released Thursday by Mintel, a global reasearch firm, found just 20% of consumers think student loans are a good investment, down from 54% in 2012.

Mintel surveyed 2,217 Americans 18 and older.

In 2012, the majority or respondents were paying less than $300 a month (79%), and only 21% had payments over that amount. Two years later, half of respondents had monthly payments of $300 or less, and the percentage paying more than $300 every month increased to 30%. Furthermore, 5% were actually paying more than $1,000.

“Clearly there are other ways to go to school besides taking out an enormous amount of money to do so, but I think there’s also a question about the absolute value of the thousands of dollars or whatever that you’re going to spend to go to school,” Robyn Kaiserman, a financial services analyst at Mintel, told ThinkAdvisor on Monday.

She added that improvements in the economy might also contribute to falling enrollment rates at colleges. “There’s some thinking that the improvement in the economy is not helping college enrollment either, as some people who may have opted to get a job who couldn’t get a job and were going to school as their default position,” she said. “Now that there are jobs, some of those people are going to work instead of going to school, or they’re starting school and dropping out to get the work that they couldn’t get a couple of years ago.”

The survey found, however, that paying back student loans might appear to be worse than it is. Almost two-thirds of respondents in 2012 said they were having a hard time paying back their loans. That fell to 42% in 2014. The 2012 respondents were also more likely to worry that their student loan debt would prevent them from getting a mortgage than the 2014 respondents.

“I was kind of surprised by that, frankly,” Kaiserman said. “I’m sure it has to do with the economy and [how] it’s a little bit better. It feels better for a lot of people.”

Eleven percent of respondents said their student debt was between $50,000 and $100,000, according to Kaiserman, and 16% said they had debt between $10,000 and $50,000. More than half said they had no student loan debt, but that fell significantly from 2012, when 81% of respondents reported no debt, Kaiserman said.

Mintel noted that while tuitions and fees are still increasing, the rate is slowing. The rate of increase for in-state tuition and fees at four-year public institutions rose only 2.9% for the 2013-14 year, down from 4.5% in 2012-13 and 8.5% for 2011-12. The current increase is the smallest it’s been in 30 years, according to Mintel.

Although price increases are slowing down, enrollment has fallen. For the 2013-14 school year, enrollment fell 1.5% from the previous year, according to the National Student Clearinghouse, after falling 2% for the 2012-13 year.

“It’s not so much whether the college education is worth it, but whether the individual school is worth it. Is it worth it to spend $250,000 versus whatever your state university costs? Or is it better to go to the community college for two years then transfer to the four-year school? There’s a lot more conversation around that.”

Hot Sliver Companies To Own For 2015

Housing starts jumped 7% to a seasonally adjusted annual rate of 1.036 million for March, according to a Commerce Department report (link opens in PDF) released today.

Market analysts had expected a slight 1.4% month-to-month increase. After a 7.3% dip in January and a 0.8% bump for February, these newest numbers tentatively put housing starts back on an upward trend.

Source: Census.gov.�

On a regional level, the South and Midwest carried the nation's starts, up 10.9% and 9.6%, respectively. Housing starts in the West bumped up 2.7%, while Northeast numbers came in 5.8% below February's.

Housing completions for March hit a seasonally adjusted annual rate of 800,000, 11% above February's numbers. March building permits fell a seasonally adjusted 3.9% to an annual rate of 902,000�after a 4.6% rise in February. Analysts had expected a rate of 942,000.

Hot Sliver Companies To Own For 2015: Solitario Exploration & Royalty Corp (XPL)

Solitario Exploration & Royalty Corp. is an exploration company. The Company is a gold producer with its development-stage Mt.Hamilton gold project in Nevada. The Company has a portfolio of royalty structured joint ventures on advanced mineral projects with partners, such as Votorantim Metais, Anglo Platinum and Newmont Mining. The Company�� advanced projects include Mt. Hamilton: gold project, the United States, Bongara: zinc-lead-silver, Peru, and Pedra Branca: platinum-palladium, Brazil. Its gold-silver exploration projects include Pachuca Real: silver-gold, Mexico and Cerro Azul: Gold-Silver, Peru. The Company�� base metal and polymetallic exploration projects include Chambara: zinc-lead-silver, Peru and La Promesa: silver-zinc-lead-indium, Peru. In December 2013, Solitario Exploration & Royalty Corp raised its interest to 23.537% from 3.233%, by acquiring a 20.304% stake in Ely Gold & Minerals Inc. Advisors' Opinion:

• [By Monica Wolfe]

  Solitario Exploration & Royalty (XPL)

  Several insiders made significant buys this week as the company�� share price continues to dwindle beneath its all-time lows. Most notably, President and CEO Christopher Herald bought 400,000 shares. He purchased these shares at $0.84 per share for a total transaction amount of $336,000. Since this buy, the share price has increased approximately 11.9%.

Hot Sliver Companies To Own For 2015: Lee Enterprises Incorporated (LEE)

Lee Enterprises, Incorporated provides local news, information, and advertising services primarily in midsize or small markets in the United States. The company publishes 50 daily and 39 Sunday newspapers, 300 weekly newspapers and classified, and niche publications in 22 states; and provides retail, classified, digital, and national advertising services. It also provides digital infrastructure and digital publishing services for approximately 1,500 daily and weekly newspapers and shoppers. The company was founded in 1890 and is based in Davenport, Iowa.

Advisors' Opinion:

• [By Roberto Pedone]

  Another newspaper publishing player that looks ready to trigger a major breakout trade is Lee Enterprises (LEE), which is a provider of local news and information and a platform for advertising, in primarily midsize markets. This stock has been on fire so far in 2013, with shares up big by 154%.

  >>Hack Earnings Season With These Serial Surprisers

  If you take a look at the chart for Lee Enterprises, you'll notice that this stock is just starting to spike higher back above its 50-day moving average of $2.89 a share with strong upside volume. Volume already today has registered over 360,000 shares, which is quickly approaching its three-month average action of 399,735 shares. This move is quickly pushing shares of LEE within range of triggering a major breakout trade.

  Traders should now look for long-biased trades in LEE if it manages to break out above some near-term overhead resistance levels at $3.14 a share to its 52-week high at $3.20 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 399,735 shares. If that breakout hits soon, then LEE will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $4 to $5 a share.

  Traders can look to buy LEE off any weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support levels at $2.71 or at $2.60 a share. One could also buy LEE off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

• [By Mike Arnold]

  I look at Glacier as one part Lee Enterprises (LEE) (community newspapers), one part Daily Journal Corp. (DJCO) (business/trade publications) with a splash of web start up. If Glacier were a drink, it would make for a delectable cocktail. Instead, its shares make for compelling investment aperitif at current prices.

• [By Jeff Reeves]

  Newspapers are hardly a growth industry, but after such a horrible fall from grace, publisher Lee Enterprises (LEE) may be a decent investment once more.

• [By George Putnam]

  Lee Enterprises (LEE) is a publisher of regional newspapers. Like many in its sector, the company struggled with competition from the Internet, and it went through a short bankruptcy at the end of 2011.

Top 5 Regional Bank Stocks To Watch Right Now: Sinclair Broadcast Group Inc.(SBGI)

Sinclair Broadcast Group, Inc., a television broadcasting company, owns or provides certain programming, operating, or sales services to television stations in the United States. The company broadcasts free over-the-air programming, such as network provided programs, news produced locally, local sporting events, programming from program service arrangements, and syndicated entertainment programs. It owns or provides programming and operating services pursuant to local marketing agreements, or provides sales services pursuant to outsourcing agreements to 58 television stations in 35 markets. The company was founded in 1952 and is based in Hunt Valley, Maryland.

Advisors' Opinion:

• [By Eric Volkman]

  In the latest of a string of acquisitions, Sinclair Broadcast Group (NASDAQ: SBGI  ) is to buy Fisher Communications (NASDAQ: FSCI  ) . The merger transaction will cost the former roughly $373 million. Fisher stockholders are to receive a cash payout of $41.00 per share, which, according to Sinclair, is a 44% premium to the stock's recent closing price.

Hot Sliver Companies To Own For 2015: LIN TV Corp(TVL)

LIN TV Corp., together with its subsidiaries, operates as a local television and digital media company. It operates or services 32 network-affiliates, television station Websites, and mobile products in 15 U.S. markets. The company?s television stations, which are affiliated with a national broadcast network, deliver local news and community stories, as well as sports and entertainment programming to 7.4% of U.S. television homes. It is also involved in the convergence of local broadcast television and the Internet through its television station Websites and local online technologies. In addition, LIN TV Corp. offers its content online and on mobile applications. The company was formerly known as Ranger Equity Holdings Corporation and changed its name to LIN TV Corp. in February 2002. LIN TV Corp. was founded in 1966 and is headquartered in Providence, Rhode Island.

Advisors' Opinion:

• [By Seth Jayson]

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

Hot Sliver Companies To Own For 2015: California Water Service Group (CWT)

California Water Service Group, incorporated on August 2, 1999, is a holding company. The Company operates California Water Service Company (Cal Water), New Mexico Water Service Company (New Mexico Water), Washington Water Service Company (Washington Water), Hawaii Water Service Company, Inc. (Hawaii Water), and CWS Utility Services and HWS Utility Services LLC are collectively called Utility Services. Cal Water, New Mexico Water, Washington Water, and Hawaii Water are regulated public utilities. Utility Services provides non-regulated services to private companies and municipalities. The Company�� business is conducted through its operating subsidiaries. Its bulk business consists of the production, purchase, storage, treatment, testing, distribution and sale of water for domestic, industrial, public and irrigation uses, and for fire protection. It also provides non-regulated water-related services under agreements with municipalities and other private companies. The non-regulated services include full water system operation, billing and meter reading services. Non-regulated operations also include the lease of communication antenna sites, lab services, and promotion of other non-regulated services.

Regulated Business

California water operations are conducted by the Cal Water and CWS Utility Services entities, which provide service to approximately 473,100 customers in 83 California communities through 25 separate districts. Of these 25 districts, 23 districts are regulated water systems, which are subject to regulation by the California Public Utilities Commission (CPUC). Cal Water operates two leased water systems, the City of Hawthorne and the City of Commerce, which are governed through their respective city councils and are outside of the CPUC's jurisdiction. California water operations account for approximately 94% of its total customers and approximately 94% of its total consolidated operating revenue.

Hawaii Water provides service to approximately 4,2! 00 water and wastewater customers on the islands of Maui and Hawaii, including several resorts and condominium complexes. Hawaii's regulated operations are subject to the jurisdiction of the Hawaii Public Utilities Commission. Hawaii Water accounts for less than 1% of its total customers and approximately 3% of its total operating revenue.

Washington Water provides domestic water service to approximately 15,800 customers in the Tacoma and Olympia areas. Washington Water's utility operations are regulated by the Washington Utilities and Transportation Commission. Washington Water accounts for approximately 3% of its total customers and approximately 2% of its total consolidated operating revenue.

New Mexico Water provides service to approximately 7,600 water and wastewater customers in the Belen, Los Lunas and Elephant Butte areas in New Mexico. New Mexico's regulated operations are subject to the jurisdiction of the New Mexico Public Regulation Commission. New Mexico Water accounts for approximately 2% of its total customers and approximately 1% of its total consolidated operating revenue.

Non-Regulated Businesses

Non-regulated activities consist primarily of operating water and waste water systems, which are owned by other entities; providing meter reading and billing services; leasing communication antenna sites on its properties; operating recycled water systems; providing lab services for water quality testing; billing of optional third-party insurance program to its residential customers; selling surplus property, and other services as requested by the client. The Company provides operating and maintenance, meter reading and customer billing services for several municipalities in California. It also provides sewer and refuse billing services to several municipalities. The Company leases antenna sites to telecommunication companies, which place equipment at various Company-owned sites. The antennas are used in cellular phone and personal communic! ation app! lications.

Advisors' Opinion:

• [By Richard Band]

  California Water Service (CWT) is the third-largest publicly traded water utility in the country��nd the largest west of the Mississippi River. The company has raised its dividend for 47 years in a row.

• [By Marc Bastow]

  Utility holding company California Water (CWT) raised its quarterly dividend 1.5% to 16.25 cents per share, payable on Feb. 21 to shareholders of record as of Feb. 10.
  CWT Dividend Yield: 2.78%

Hot Sliver Companies To Own For 2015: CDI Corporation(CDI)

CDI Corp. provides engineering and information technology project outsourcing solutions and professional staffing services primarily in the United States, the United Kingdom, and Canada. It operates in four segments: ES, MRI, Anders, and ITS. The ES segment provides engineering, design, project management, staffing, and outsourcing solutions to oil, gas, refining, alternative energy, power generation and energy transmission, chemicals, and heavy manufacturing industries; engineering, design, logistics, and staffing services to the defense industry, primarily in marine design, systems development, and military aviation support; engineering, design, project management, staffing, and facility start-up services to pharmaceutical, bio-pharmaceutical, and regulated medical services industries; and architecture, civil and environmental engineering, communication technology, and consulting services to governmental, educational, and private industry customers. The MRI segment opera tes as a global franchisor that does business as MRINetwork and provides the use of its trademarks, business systems, and training and support services to its franchisees who engage in the search and recruitment of executive, technical, professional, and managerial personnel for employment by their customers. It also provides training, implementation services, and back-office services to enable franchisees to pursue staffing opportunities. The Anders segment provides contract and permanent placement candidates to customers in the areas of architecture, building services, rail, commercial and industrial construction, consulting engineering, facilities management, interior design, surveying, and town planning. The ITS segment offers various information technology related services, which include staffing augmentation, permanent placement, outsourcing, and consulting. The company was founded in 1950 and is based in Philadelphia, Pennsylvania.

Advisors' Opinion:

• [By Rich Smith]

  Philadelphia-based CDI Corp. (NYSE: CDI  ) has won a $36 million contract to provide watercraft engineering and marine services to the U.S. Navy.

Hot Sliver Companies To Own For 2015: iShares 3-7 Year Treasury Bond ETF (IEI)

iShares Lehman 3-7 Year Treasury Bond Fund (the Fund) seeks investment results that correspond generally to the price and yield performance of the intermediate-term sector of the United States Treasury market as defined by the Lehman Brothers 3-7 Year U.S. Treasury Index (the Index). The Index includes all publicly issued the United States Treasury securities that have a remaining maturity of greater than or equal to three years and less than seven years, and have $250 million or more of outstanding face value. In addition, the securities must be denominated in United States dollars, and must be fixed-rate and non-convertible securities. Excluded from the Index are certain special issues, such as flower bonds, targeted investor notes, and state and local government series bonds, and coupon issues that have been stripped from assets that are already included in the Index.

The Index is a market capitalization-weighted index. The Fund invests in a representative sample of the securities in the Index, which has a similar investment profile as the Index. The Fund�� investment advisor is Barclays Global Fund Advisor.

Advisors' Opinion:

• [By Donald van Deventer]

  Shorter-duration Treasury Exchange-Traded Funds: (SHY), (SHV), (IEI), (BIL), (TUZ), (FIVZ), (DTUL), (VGSH), (DTUS), (DFVS), (DFVL), (SST), (ISTB), (TBZ).

Hot Sliver Companies To Own For 2015: Higher One Holdings Inc.(ONE)

Higher One Holdings, Inc. provides technology and payment services in the United States. It offers a suite of disbursement and payment solutions for higher education institutions and their students. The company provides OneDisburse Refund Management product that offers higher education institutional clients with a technology service for streamlining the student refund disbursement process. It also offers CASHNet Payment suite that includes software-as-a-service products and services, such as ePayment to securely accept online payments for tuition, charges, and fees from students through credit card, pinless debit, and ACH; eBill to automate payer billing and processing functions; MyPaymentPlan to personalize students? payment plans; eMarket that allows academic, athletic, and other departments to take alumni donations, sell event tickets and other merchandise, and accept payments of event and conference registration fees; and Cashiering to operate and manage cashiering fu nctions, back office payments, and campus-wide departmental deposits. In addition, the company provides OneDisburse ID, which offers an option to combine the company?s debit card with the institution?s ID cards; OneDisburse Payroll to distribute payroll and other employee-related payments; OneDisburse PLUS product to distribute Parent PLUS loan refunds to parents on behalf of the school; and Financial Intelligence to students with an online class. Further, it provides student-oriented banking services to campus communities. Additionally, the company offers OneAccount product for students, as well as faculty, staff, and alumni, with an FDIC-insured online checking account and a debit MasterCard ATM card. Higher One Holdings, Inc. was founded in 2000 and is headquartered in New Haven, Connecticut.

Advisors' Opinion:

• [By Roberto Pedone]

  One under-$10 business services player that looks poised for a run higher is Higher One (ONE), which provides technology-based refund disbursement, payment processing and data analytics services to higher education institutions and students. It also provides banking services to campus communities. This stock has been hit hard by the bears so far in 2013, with shares down by 26%.

  If you take a look at the chart for Higher One, you'll notice that this stock has been downtrending badly for the last three months, with shares plunging from its high of $11.93 to its recent low of $6.97 a share. During that downtrend, shares of ONE were consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of ONE have recently formed a double bottom chart pattern at $7.05 to $6.97 a share. This stock has now started to rebound sharply off that double bottom and move within range of triggering a near-term breakout trade.

  Traders should now look for long-biased trades in ONE if it manages to break out above some near-term overhead resistance at $7.85 a share and then once it clears its 50-day moving average at $8.11 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 196,360 shares. If that breakout triggers soon, then ONE will set up to re-test or possibly take out its next major overhead resistance levels at $9 to its 200-day moving average of $9.77 a share. This stock could even tag $11 a share if that 200-day gets taken out with volume.

  Traders can look to buy ONE off weakness to anticipate that breakout and simply use a stop that sits right below some key near-term support at $7.39 a share, or below $7 a share. One can also buy ONE off strength once it takes out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

• [By Seth Jayson]

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

• [By Seth Jayson]

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

Comcast, McDonald’s, Yum, AT&T are stocks to watch

SAN FRANCISCO (MarketWatch) — Among the companies whose shares are expected to see active trade in Tuesday's session are Comcast Corp., McDonald's Corp., Yum Brands Inc., and AT&T Inc.

Comcast (CMCSA)  is projected to report first-quarter earnings of 64 cents a share, according to a consensus survey by FactSet. "We believe that Buy-rated Comcast offers among the best large cap upsides in stock within WSI's [technology, media and telecommunications] coverage, with particular benefit from NBCUniversal as we estimate that the latter business could be worth as much as $64 billion," analyst Matthew Harrigan at Wunderlich Securities Inc. said in a note.

McDonald's (MCD)  is likely to post earnings of $1.24 a share in the first quarter. "We rate the shares of McDonald's Corp. neutral. This rating largely reflects our concerns about domestic same-store sales trends and unit-level operations, including menu complexity and what appears to be slowing average service times," said Mark Kalinowski at Janney Capital Markets.

Yum Brands (YUM)  is forecast to post earnings of 84 cents a share in the first quarter. The stock was downgraded to neutral from overweight at J.P. Morgan on Monday.

AT&T (T)  is expected to report earnings of 70 cents a share in the first quarter. "We maintain our HOLD rating and $35 target ahead of AT&T's first quarter 2014 earnings release. We continue to believe the wireline business remains challenged while wireless competition – and the company's response to it – will limit wireless service revenue growth," said Greg Miller at Canaccord Genuity Inc.

Lockheed Martin Corp. (LMT)  is projected to report first-quarter earnings of $2.54 a share.

United Technologies Corp. (UTX)  is forecast to post earnings of $1.27 a share in the first quarter.

Amgen Inc. (AMGN)  is likely to report earnings of $1.94 a share in the first quarter.

Gilead Sciences Inc. (GILD)  is expected to post first-quarter earnings of 89 cents a share.

Intuitive Surgical Inc. (ISRG)  is projected to report first-quarter earnings of $3.29 a share.

After Monday's closing bell, Netflix Inc. (NFLX)  said it earned 86 cents a share in the first quarter, beating analysts' average estimate of 81 cents a share. The video streaming company also plans to hike prices in the U.S. for new member by $1 to $2. Shares of Netflix jumped 6.9% in after-hours trading.

Shares of Allergan Inc. (AGN)  surged 15% in extended trading following a Wall Street Journal report that hedge fund manager Bill Ackman and Valeant Pharmaceuticals International have joined hands to take over the company. Ackman's Pershing Square Capital Management has already built up almost a 10% stake in the Allergan, the newspaper said.

Bull vs. Bear debate: Is pullback over?

The stock market has taken investors on a roller-coaster ride the past two weeks.

First came the plunge: the Nasdaq composite's worst weekly drop since June 2012.

Then came the rebound: the broad U.S. market's best week since last July.

Now comes the face-off between bulls and bears centering around the key question: Is the pullback over?

The bulls say the worst days are behind us.

They cite the Nasdaq composite's ability to rebound after teetering last Tuesday on the brink of its first 10% correction since late 2012. They say the pullback, while severe, was confined mainly to the frothy parts of the market -- and never truly put the "blue chip" part of the market at risk. And they note that market indexes were able to stay above key long-term levels deemed critical to market stability.

The bears are not so sure the selling is done.

They say hard-hit growth stocks in the Internet and biotech space still need to come down more after big run-ups caused them to get overly pricey. They warn of more volatile days ahead, with wild swings causing fear levels and stock prices to rise and fall sharply. They also point to possible flashpoints, or shocks, such as the Russia-Ukraine crisis, or concerns about Federal Reserve policy, or a sharp rise in interest rates, that could also derail the bull market.

WHY THE BULLS SAY THE WORST IS OVER

* It's not about the economy

The scary pullback, which dragged down the Nasdaq 8.2% on a closing basis, wasn't caused by fears of a recession, the normal trigger for a major decline. It was centered on just a handful of sectors that went up too far, too fast, says Nicholas Sargen, chief investment officer at Fort Washington Investment Advisors.

"This isn't about the economy, it isn't about corporate profits," Sargen says. "It is more about the fact that valuations in tech and biotech have gotten excessive. We're in the midst of a correction but not necessarily for the entire market, (just) the segment where! valuations got stretched. I don't think the broad market is unduly expensive." (Many high-flying stocks had price-to-earnings ratios north of 100, v. a P-E of around 16 for the broad market based on 2014 profit estimates, according to Thomson Reuters.)

* Key price levels held

At the low point of its decline, during a midday 2% swoon last Tuesday, the Nasdaq was down more than 9% from its March 5 high. But thanks to a massive reversal, dubbed "Turnaround Tuesday," that occurred right at its key 200-day price average, the Nasdaq was able to wipe out those daily losses and finish the week up 2.4% and just 6% off its 2014 high.

Walter Zimmerman, chief market technician at United-ICAP, says the Nasdaq's ability to avoid falling below that key level and into official correction territory, suggests the decline is history.

"I think the stock market correction is over," he says.

* Nasdaq pullback normal, healthy

Given the decent shape of the economy, the broad market doesn't look like it will get dragged down by the loss of momentum in pricey growth stocks, says Rod Smyth, chief investment strategist at Riverfront Investment Group.

"I would be more inclined to look at this as correction in an ongoing bull market," says Smyth. "Given the size of the Nasdaq's move higher since its last correction in November 2012 (a gain of 54%), correcting 8% or 9% doesn't seem like something to get alarmed about."

WHY THE BEARS SAY THE SELLING MAY NOT BE OVER

* Still-pricey valuations

Those momentum stocks that took a beating are still not cheap, which means they will likely be subject to further bouts of selling as Wall Street looks to bring those pricey names down to more normal valuation levels, says Ann Miletti, senior portfolio manager at Wells Fargo Advantage Funds.

* It's not 2013 anymore

The market has lost its momentum, and investors should expect more ups and downs ahead, insists Bill Hornbarger, chief investment strategist at Moneta Group. More ! stock mar! ket weakness is possible, he warns, given the geopolitical risks related to the Russia-Ukraine crisis and a recent rise in gas prices.

"What we are telling our clients is that 2014 will be the opposite of 2013," he says. "Last year, the economy was just OK and the markets did really well. This year we expect the economy to improve and the markets to be just OK."

* Bubbles are bursting

"The market is in a long-term topping process," says Richard Suttmeier, chief market strategist at ValuEngine.com.

His proof? Bubbles are bursting in many pockets of the market.

"The damage has been already done.," says Suttmeier. "Look at all the biotech and momentum stocks that broke. I see bubbles bursting in individual stocks and individual stocks eventually equals the market."

Wall Street Bond Dealers Whipsawed on Bearish Treasuries Bet

Betting against U.S. government debt this year is turning out to be a fool’s errand. Just ask Wall Street’s biggest bond dealers.

While the losses that their economists predicted have yet to materialize, JPMorgan Chase & Co., Citigroup Inc. and the 20 other firms that trade with the Federal Reserve began wagering on a Treasuries selloff last month for the first time since 2011. The strategy was upended as Fed Chair Janet Yellen signaled she wasn’t in a rush to lift interest rates, two weeks after suggesting the opposite at the bank’s March 19 meeting.

The surprising resilience of Treasuries has investors recalibrating forecasts for higher borrowing costs as lackluster job growth and emerging-market turmoil push yields toward 2014 lows. That’s also made the business of trading bonds, once more predictable for dealers when the Fed was buying trillions of dollars of debt to spur the economy, less profitable as new rules limit the risks they can take with their own money.

“You have an uncertain Fed, an uncertain direction of the economy and you’ve got rates moving,” Mark MacQueen, a partner at Sage Advisory Services Ltd., which oversees $10 billion, said by telephone from Austin, Texas. In the past, “calling the direction of the market and what you should be doing in it was a lot easier than it is today, particularly for the dealers.”

Treasuries have confounded economists who predicted 10-year yields would approach 3.4 percent by year-end as a strengthening economy prompts the Fed to pare its unprecedented bond buying.

Caught Short

After surging to a 29-month high of 3.05 percent at the start of the year, yields on the 10-year note have declined and were at 2.72 percent at 7:42 a.m. in New York.

One reason yields have fallen is the U.S. labor market, which has yet to show consistent improvement.

The world’s largest economy added fewer jobs on average in the first three months of the year than in the same period in the prior two years, data compiled by Bloomberg show. At the same time, a slowdown in China and tensions between Russia and Ukraine boosted demand for the safest assets.

Wall Street firms known as primary dealers are getting caught short betting against Treasuries.

They collectively amassed $5.2 billion of wagers in March that would profit if Treasuries fell, the first time they had net short positions on government debt since September 2011, data compiled by the Fed show.

‘Some Time’

The practice is allowed under the Volcker Rule that limits the types of trades that banks can make with their own money. The wagers may include market-making, which is the business of using the firm’s capital to buy and sell securities with customers while profiting on the spread and movement in prices.

While the bets initially paid off after Yellen said on March 19 that the Fed may lift its benchmark rate six months after it stops buying bonds, Treasuries have since rallied as her subsequent comments strengthened the view that policy makers will keep borrowing costs low to support growth.

On March 31, Yellen highlighted inconsistencies in job data and said “considerable slack” in labor markets showed the Fed’s accommodative policies will be needed for “some time.”

Then, in her first major speech on her policy framework as Fed chair on April 16, Yellen said it will take at least two years for the U.S. economy to meet the Fed’s goals, which determine how quickly the central bank raises rates.

After declining as much as 0.6 percent following Yellen’s March 19 comments, Treasuries have recouped all their losses, index data compiled by Bank of America Merrill Lynch show. Yield Forecasts

“We had that big selloff and the dealers got short then, and then we turned around and the Fed says, ‘Whoa, whoa, whoa: it’s lower for longer again,’” MacQueen said in an April 15 telephone interview. “The dealers are really worried here. You get really punished if you take a lot of risk.”

Economists and strategists around Wall Street are still anticipating that Treasuries will underperform as yields increase, data compiled by Bloomberg show.

While they’ve ratcheted down their forecasts this year, they predict 10-year yields will increase to 3.36 percent by the end of December. That’s more than 0.6 percentage point higher than where yields are today.

“My forecast is 4 percent,” said Joseph LaVorgna, chief U.S. economist at Deutsche Bank AG, a primary dealer. “It may seem like it’s really aggressive but it’s really not.”

LaVorgna, who has the highest estimate among the 66 responses in a Bloomberg survey, said stronger economic data will likely cause investors to sell Treasuries as they anticipate a rate increase from the Fed.

History Lesson

The U.S. economy will expand 2.7 percent this year from 1.9 percent in 2013, estimates compiled by Bloomberg show. Growth will accelerate 3 percent next year, which would be the fastest in a decade, based on those forecasts.

Dealers used to rely on Treasuries to act as a hedge against their holdings of other types of debt, such as corporate bonds and mortgages. That changed after the credit crisis caused the failure of Lehman Brothers Holdings Inc. in 2008.

They slashed corporate-debt inventories by 76 percent from the 2007 peak through last March as they sought to comply with higher capital requirements from the Basel Committee on Banking Supervision and stockpiled Treasuries instead.

“Being a dealer has changed over the years, and not least because you also have new balance-sheet constraints that you didn’t have before,” Ira Jersey, an interest-rate strategist at primary dealer Credit Suisse Group AG, said in a telephone interview on April 14.

Almost Guaranteed

While the Fed’s decision to inundate the U.S. economy with more than $3 trillion of cheap money since 2008 by buying Treasuries and mortgaged-backed bonds bolstered profits as all fixed-income assets rallied, yields are now so low that banks are struggling to make money trading government bonds.

Yields on 10-year notes have remained below 3 percent since January, data compiled by Bloomberg show. In two decades before the credit crisis, average yields topped 6 percent.

Average daily trading has also dropped to $551.3 billion in March from an average $570.2 billion in 2007, even as the outstanding amount of Treasuries has more than doubled since the financial crisis, according data from the Securities Industry and Financial Markets Association.

“During the crisis, the Fed went to great pains to save primary dealers,” Christopher Whalen, banker and author of “Inflated: How Money and Debt Built the American Dream,” said in a telephone interview. “Now, because of quantitative easing and other dynamics in the market, it’s not just treacherous, it’s almost a guaranteed loss.”

Trading Revenue

The biggest dealers are seeing their earnings suffer. In the first quarter, five of the six biggest Wall Street firms reported declines in fixed-income trading revenue.

JPMorgan, the biggest U.S. bond underwriter, had a 21 percent decrease from its fixed-income trading business, more than estimates from Moshe Orenbuch, an analyst at Credit Suisse, and Matt Burnell of Wells Fargo & Co.

Citigroup, whose bond-trading results marred the New York- based bank’s two prior quarterly earnings, reported a 18 percent decrease in revenue from that business. Credit Suisse, the second-largest Swiss bank, had a 25 percent drop as income from rates and emerging-markets businesses fell. Declines in debt- trading last year prompted the Zurich-based firm to cut more than 100 fixed-income jobs in London and New York.

Bank Squeeze

Chief Financial Officer David Mathers said in a Feb. 6 call that Credit Suisse has “reduced the capital in this business materially and we’re obviously increasing our electronic trading operations in this area.” Jamie Dimon, chief executive officer at JPMorgan, also emphasized the decreased role of humans in the rates-trading business on an April 11 call as the New York-based bank seeks to cut costs.

About 49 percent of U.S. government-debt trading was executed electronically last year, from 31 percent in 2012, a Greenwich Associates survey of institutional money managers showed. That may ultimately lead banks to combine their rates businesses or scale back their roles as primary dealers as firms get squeezed, said Krishna Memani, the New York-based chief investment officer of OppenheimerFunds Inc., which oversees $79.1 billion in fixed-income assets.

5 Things to Do Right Now for Your Taxes Next Year

For those of you who met the tax deadline and didn't file an extension, give yourself a pat on the back -- it's another tax season in the books. But, just because one tax season is out of the way doesn't mean you can't start thinking about how to make life easier for yourself when it comes time to doing your 2014 taxes.

Today, we're going to look at five things you can do right now to not only make your taxes easier, but potentially put more money in your pocket over the long run.

Source: Jarmoluk, Pixabay.

1. Stay organized
Consider this to be "practice what you preach" advice because it's my single greatest hurdle each and every tax season. Instead of spending hours searching through receipts, W-2s, 1099s, investment statements, and bank statements, consider entering all of this information on a monthly basis into an Excel file or money-management software platform so you can be organized come tax time. Keep in mind that your time is valuable, and having the right information at your fingertips will save you from a lot of hassle in the long run.

2. Narrow down your projected tax liability for 2014
If you're one of the many Americans that gets a four-digit refund from the IRS, or who winds up owing $1,000 or more to the IRS at the end of the year, you aren't doing yourselves any favors. Refunds are a nice way of forcing Americans to save their hard-earned money, but it's also not earning any interest or helping in any investable way while in the government's hands. Similarly, underpaying your taxes, if you make quarterly payments, by a significant amount can result in a penalty equal to 10% of the underpayment.

To correct this, you should take the time to plot out with some level of certainty what you expect to earn this year. This isn't to say you're going to hit your final tax liability on the nose, but it should allow you more of your own money upfront if you're due a refund, which you can put to work sooner, or reduce the surprise of an unwelcome underpayment penalty. This means being proactive on your W-4s and with your quarterly tax payments in 2014.

3. Max out your 401(k)
We have practically beaten down the door talking about individual retirement accounts around tax time at The Motley Fool, but that's primarily because Traditional IRAs and Roth IRAs allow you to make contributions for the prior year up until April 15. There's no previous year catch-up, though, on 401(k) contributions, meaning you should be thinking right now about how you plan to max-out your contribution in 2014.

One of the biggest retirement mistakes investors make is in not taking advantage of a company's 401(k) match. As I noted in November as an example, a 30-year employee of IBM making $40,000 a year, who plans to retire at age 65, and gets a match up to 6% by IBM (one of the most generous matches among big business), would be retiring with about $344,000 less in their account than if they took advantage of IBM's match. A 401(k) can play a big role in your retirement, and the contribution limit this year is $17,500, so get to it!

Source: StockMonkeys.com, Flickr.

4. Open a Roth IRA
A Traditional IRA is a great upfront boost for taxpayers looking to reduce their taxable income, but it may not be the best solution for long-term investors. In fact, many investors should really consider opening or switching to a Roth IRA which will net you no upfront tax breaks but could deliver incredible tax breaks over your lifetime.

Although both IRAs are similar in that they penalize you for an early withdrawal before age 59 1/2, the big difference is that while you do owe taxes on the gains in your Traditional IRA once you begin taking distributions, the money in your Roth IRA can grow completely tax-free (in exchange for no upfront contribution deduction). You can see how this could be valuable to someone in their 20s, 30s, 40s, and even 50s who can use the power of compound returns to their advantage without ever worrying about paying a cent in taxes once they begin taking distributions at age 59 1/2.

5. Seek out deductions early
Lastly, don't wait until December before you decide you want to make a big impact on your deductions in 2014. There are a number of things you can consider doing year-round that could help reduce your tax liability including donating to your favorite charity and performing energy-efficient upgrades on your home. The point is that a number of people realize far too late in the game that they want to beef up their deductions, so be proactive in 2014 about how you're going to make your dollar go farther.

Have you taken advantage of this little-known tax "loophole"
Recent tax increases have affected nearly every American taxpayer. But with the right planning, you can take steps to take control of your taxes and potentially even lower your tax bill. In our brand-new free special report "The IRS Is Daring You to Make This Investment Now!," you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.