Advisors, Investors Confident About Future: Schwab

RIAs are more confident and optimistic about their businesses for the future, according to Schwab Advisor Services. The firm published its 13th semiannual Independent Advisor Outlook Study on Wednesday, finding that advisors are confident and aware of the challenges they face.

One of those challenges is what to do about the women and younger clients who will soon be the bulk of their client base. About two-thirds of respondents said women, Gen X and Gen Y clients will be the “driving force” of their profitability in five years.

That realization doesn’t mean advisors are actively addressing those clients yet. More than two-thirds of respondents said asset growth was their top priority for the next few years and that profitability is coming from high-net-worth clients, boomers and retirees.

“Positioning their firms for sustainable long-term growth means RIAs have to balance the demands of running a successful business today with the need to make investments and take proactive steps to attract and meet the needs of a new generation of clients,” Bernie Clark, executive vice president and head of Schwab Advisor Services, said in a statement. “RIAs have significant opportunity with the clients who are right here, right now. But they also have to keep their eye on how best to navigate the unchartered territory that lies ahead – it is a delicate but important equilibrium.”

While the vast majority of advisors said they were interested in working with their clients’ children, one of the barriers to doing so is that they don’t think they have enough assets to make it worth their while. Living in a different area and wanting to use another advisor are also barriers to working with clients’ children.

Another challenge to future profitability is more competition from other RIAs and other types of firms that are trying to emulate RIA firms. Consequently, 72% of advisors are focusing on differentiating their firms. One way they’re doing so is by building a talented team of advisors at their firms. More than half of respondents said they need to hire more diverse advisors, and 46% said they needed more young advisors. However, many are struggling to find qualified people, and when they do, to train them.

Schwab also polled investors in a separate survey to gauge their attitudes and found they are similarly confident. Almost 60% of advisors and 65% of investors think the S&P 500 will continue to rise over the next six months. They differ, though, on how they’ll reach their goals. Nearly half of investors say it will be easy for their advisor to reach their investment goal in the current market—the same percentage of advisors who say it will be difficult.

Three-quarters said they were confident about making decisions with their advisor. The investor survey found clients are worried about volatility, interest rates, inflation and tax increases, and have brought those subjects up with their advisors.

Investors are clearly drawn to advisors who can provide holistic planning services, the survey found. Ninety-two percent said they wanted an advisor who could evaluate their entire financial picture. Trust is also important, and 85% of investors want to know how their advisor is compensated.

“Building trusted relationships with clients is an RIA sweet spot. The independent model allows advisors to offer what investors want – collaboration, customization, transparency and accountability,” said Clark. “This invaluable combination sets RIAs apart from more conflicted models and positions them very competitively for success.”

The investor survey found a significant gap in where clients put their trust. Seventy-two percent said they put their trust in individual advisors, compared with 42% who said they trust financial services companies as a whole.

More advisors anticipate consumer spending will increase than the last time the survey was conducted in July 2012, but they also expect household debt will increase with it.

The advisor survey asked which sectors will perform best in the next six months and found 40% of advisors expect health care will perform well. Information technology also had high expectations, though less than in last year’s survey.

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Check out Servicemembers, Civilians Less Worried About Economy on AdvisorOne.

Diageo to Buy More United Spirits - Analyst Blog

Leading brewer and distributor Diageo plc (DEO) has increased its ownership in United Spirits Limited by a further 14.98% for a cash consideration of £344.2 million. This acquisition takes Diageo another step toward its goal of acquiring 27.4% ownership in this leading spirit company of India.

In Nov 2012, Diageo and United Spirits Ltd. announced an agreement under which Diageo will acquire a 53.4% stake in the latter for £1.285 billion ($2.05 billion). This will allow Diageo to gain a foothold in the fast-growing alcohol market in India.

Under the agreement, initially Diageo was to buy 27.4% stake in United Spirits for INR 1440 per share ($26.32 per share), amounting to a total consideration of £660 million ($1.05 billion), and make a tender offer for the remaining 26%.

Diageo will finance the acquisition, slotted to be closed in first quarter of fiscal 2013, through existing cash and debt. The joint venture received a clean bill of health from the fair trade watchdog Competition Commission of India (CCI).

Dr. Vijay Mallya, the Indian entrepreneur and owner of United Spirits, needs sufficient cash to bail his Kingfisher Airlines out of bankruptcy. While the acquisition will help reduce the debt, it will also provide bright opportunities for the company. Following the acquisition, Dr. Mallya will continue in his current capacity as Chairman of United Spirits.

In Dec 2012, the shareholders of United Spirits Limited approved the preferential allotment amounting to 10% of the post-issue enlarged share capital to Diageo. It also acquired some additional shares during the same period. With the recent takeover, Diageo now owns 25.02% of United Sprits Limited.

Diageo upgrades its products through continuous innovations. Recently, keeping in view the bright future of the luxury alcohol category in the global luxury market, the company launched a limited edition of Johnnie Walker Blue Label crafted by Alfred Dunhill. The new product joins the Richemont luxury br! and of blue scotch owned by the company.

Diageo has a leading position both in the beer and vodka markets with a strong portfolio of globally recognized flagship brands, including Smirnoff, Johnnie Walker, Captain Morgan, Baileys and Guinness.

DEO currently carries a Zacks Rank #3 (Hold).

Other Stocks to Consider:

Others players in the same industry which look attractive at the current levels include Fortune Brands Inc. (FBHS) and Restoration Hardware (RH) and Flower Foods Inc. (FLO), all carrying a Zacks Rank #1 (Strong Buy).

Advanced Micro Devices (AMD): The Radeon R9 290 Graphics Card Plus Other News or Events

Its been a bumpy ride for both short term and long term investors and traders alike in Advanced Micro Devices, Inc (NYSE: AMD) – including us because we have had the stock in our SmallCap Network Elite Opportunity (SCN EO) portfolio since last summer and we have seen our position make good gains only to twice see those gains evaporate after two quarterly earnings reports that did not live up to the lofty expectations of some bulls. Nevertheless, there is reason to be optimistic if you consider the following good news:

AMD Radeon R9 290 Graphics Card. Yesterday, Advanced Micro Devices launched its AMD Radeon™ R9 290 graphics card at a starting price of $399 and EUR 289 (excluding VAT) and there are already positive reviews for the card on AnandTech, Forbes (AMD Disrupts GPU Market Again With $399 Radeon R9 290), HotHardware, PC World and TechSpot. The verdict? The R9 290 not only continues to outperform the Nvidia GTX 780, but it also undercuts it by $100 - meaning NVIDIA Corporation (NASDAQ: NVDA) will either have to answer with a price cut or come up with a higher-performing, cheaper card. Cramer's Advice. For what his advice might be worth, Jim Cramer, the host of CNBC's Mad Money, has just noted that while AMD has been a disappointment this year, he pointed out that the company's products will be in both Sony Corporation's (NYSE: SNE) PlayStation 4 and Microsoft Corporation's (NASDAQ: MSFT) Xbox One consoles which he hopes will pave the way for what should be a strong quarter. However, Cramer also added that if the quarter comes in weaker than expected, investors should look elsewhere to put their money to work.  Upcoming Investor Conferences or Summits. Various Advanced Micro Devices' executives will be presenting at upcoming conferences with Devinder Kumar, senior vice president and chief financial officer, presenting at the Credit Suisse Annual Technology Conference on December 3 at 2:00 PM; John Byrne, senior vice president and chief sales officer, will present at the Raymond James Semiconductors, Software and Supply Chain Investor Conference on December 10th at 9:40 AM EST; and John Byrne will present at the BMO Capital Markets 2013 Technology & Digital Media Conference on December 11 at 9:30 AM EST. It should be remembered that investor conference presentations are often highly anticipated because they can move a stock – in either direction. Moreover, Advanced Micro Devices will webcast keynote presentations taking place at the 2013 AMD Developer Summit, "APU13", being held in San Jose on November 11 through the 13th with the schedule available here. Webcast replays of Keynote presentations will also be accessible on AMD's YouTube channel. Share Performance. Advanced Micro Devices is up 38.5% since the start of the year, up 60.6% over the past year and down 5% over the past five years with the long-term chart showing the bumpy ride longer term investors have experienced with the stock:

However, the most recent technical chart for AMD is not looking so bullish:

All things considered though, there are still plenty of reasons to remain cautiously bullish and to pay close attention to any news surrounding Advanced Micro Devices.  

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

Don't Get Too Worked Up Over Hallador Energy's Earnings

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

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

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

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

Over the past 12 months, Hallador Energy generated $1.4 million cash while it booked net income of $23.1 million. That means it turned 1.0% of its revenue into FCF. That doesn't sound so great. FCF is less than net income. Ideally, we'd like to see the opposite.

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

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

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

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

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

With questionable cash flows amounting to only 0.1% of operating cash flow, Hallador Energy's cash flows look clean. Within the questionable cash flow figure plotted in the TTM period above, stock-based compensation and related tax benefits provided the biggest boost, at 5.7% of cash flow from operations. Overall, the biggest drag on FCF came from capital expenditures, which consumed 96.0% of cash from operations.

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

Looking for an alternative to Hallador Energy? By investing in this multibillion-dollar energy company, you can get in before its stock rebounds, when natural gas prices eventually do turn upward. And until natural gas prices do rebound (which a top Motley Fool analyst expects will happen by 2014), you can cash in on its stable 5.7% dividend. Click here for instant access to this free report.

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

Add Hallador Energy to My Watchlist.

Exelon Stock Prepares for a Profitable Future

Exelon announced proposals this week to keep its current power plants punching pack for years to come. Seeking energy extensions and power provisions isn't easy, but it's often more cost-effective than adding on entirely new generation capacity. Let's see if Exelon stock has what it takes to maintain steady sales without major expenditures.

Please, sir, I want some more
Exelon (NYSE: EXC  ) filed renewal applications this week for two of its Illinois nuclear power stations. Collectively, the facilities generate more than 4,600 MW of electricity. That's 13% of the utility's total capacity and 24% of its nuclear capacity. For a peck of peer perspective, that's also more than FirstEnergy's (NYSE: FE  ) entire 3,990 MW nuclear capacity, which accounts for one-fifth of FirstEnergy's total generation.

Source: Exeloncorp.com, Braidwood Generating Station. 

The plants' four units are set to expire between 2024 and 2027, but the Nuclear Regulatory Commission's (NRC) ultimate decision comes only after a multiyear review. If there are complications or issues that arise, Exelon needs plenty of time to readjust its strategy.

The company expects a final decision by 2015 and, if recent trends are any indicator, Exelon can count on a regulatory green light. Renewal licenses are commonplace in the nuclear sector, where a reactor can operate for up to 60 years. Exelon's two facilities are currently celebrating their 25th and 28th birthdays. Additionally, the NRC approved Southern Company's (NYSE: SO  ) application for two new nuclear reactors in March 2012, the first such approval in more than 30 years.

Possibilities, not promises
Although Exelon will pursue approval with everything that it's got, the utility could ultimately turn its back on nuclear renewals. Duke Energy (NYSE: DUK  ) announced earlier this month that, despite applications submitted in 2008, the company would hold off on plans for new North Carolina nuclear units. Instead, the utility will continue to work on its $9 billion modernization project, including applications for two new nuclear plants in South Carolina and Florida.

Exelon's ultimate investment decision will most likely come down to nuclear's cost-competitiveness. With natural gas prices headed higher, it seems that more traditional fuels like nuclear and coal may be regaining their competitive edge. AEP (NYSE: AEP  ) announced this week that it's seeking proposals for up to 2.7 million tons of coal through 2016 to keep its power plants energized. At least for now, natural gas price spikes spell sustainable sales for nuclear- and coal-based companies.

Is Exelon stock worth it?
Exelon stock took a turn for the worse during the Global Recession, and it seems to be stuck in a post-recession rut. Shares are down 65% over the last five years, compared to a 7% overall decline for the Dow Jones U.S. Utilities Index and an 18% rise for the S&P 500 (INDEX: ^GSPC ).

EXC data by YCharts.

For long-term investors, Exelon stock's slump could present a unique value grab opportunity. With nuclear energy getting its groove back and an open book for new energy options, this utility's shares might just electrify your portfolio's profits.

As the nation moves increasingly toward clean energy, Exelon is perfectly positioned to capitalize on having the largest nuclear fleet in North America. This strength, combined with an increased focus on balance sheet health and its recent merger with Constellation, places Exelon and its resized dividend on a shortlist of the top utilities. To determine if Exelon is a good long-term fit for your portfolio, you're invited to check out The Motley Fool's premium research report on the company. Simply click here now for instant access.

Review: Google Music Plan Solid, Serendipitous

LOS ANGELES (AP) -- Google's (NASDAQ: GOOG  ) new music service offers a lot of eye candy to go with the tunes. The song selection of around 18 million tracks is comparable to popular services such as Spotify and Rhapsody, and a myriad of playlists curated along different genres provides a big playground for music lovers.

The All Access service represents Google's attempt to grab a bigger piece of the digital music market as more people stream songs over mobile phones. Such services are also meant to further wed smartphone users to Google's Android operating system, where the search leader makes money from advertising and transactions on its digital content store, Google Play.

For a monthly fee, All Access lets you listen to as much music as you want over an Internet connection. You can also download songs onto mobile devices for smooth playback later when you don't have cell phone or Wi-Fi access.

It's worth a try for the discounted monthly rate of $8 if you sign up by the end of June. Those who sign up later will pay $10 a month, the same amount charged by the main competitors, Spotify and Rhapsody. Either way, you get the first month free and can cancel at any time. All Access works on the free Google Play Music app for Android devices and over Web browsers on computers -- but not on the iPhone. (Spotify and Rhapsody work on both Android and the iPhone).

Visually, the app that I tested on Google's Nexus 4 smartphone is engaging. Iterating on the list-heavy layouts of its competitors, Google Play Music jazzes up the interface by adding plenty of big artist photos along with little animations, including bouncing equalizer bars and screen-size cover art that moves slowly back and forth when a song is playing.

Some of the touch features require a pixie-like dexterity, though. It's one downside to this solid entrant to the world of unlimited music streaming.

You can reorder songs that are in your queue on the fly -- something not offered by either Spotify or Rhapsody. But this takes gripping a very thin digital handle to the left of a song title and sliding it up or down. Because it's much thinner than the thumb I'm using to grip it, I ended up playing songs that I only wanted to move, or deleting them from the queue by accident (which takes a swipe right or left).

The options icon on each song title (three dots stacked on top of each other) is also tiny and caused frequent mis-taps. This means a lot of accidentally playing songs and mistakenly erasing queues that I had spent time creating.

I wasn't that impressed by the service's recommendations, although perhaps it's because I haven't used it that much. It recommended artists "like Madonna" even though I don't really listen to the Material Girl. The top recommendations were the same ones I saw onstage during Google's official unveiling of All Access last week. Digging a little deeper revealed recommendations for other works by artists whose songs I already own, like Sara Bareilles or Maroon 5. But I could have looked that up on my own.

Where the service starts to get interesting is in its radio function. Like other Internet radio plans, it takes some traits of a particular song and finds others like it somehow. Doing this with Reggie Watts' comedic beat-box tune "(bleep) (bleep) Stack," I discovered the song fits within a kind of sub-genre of humorous rappers, after it played Flight of the Conchords' "Hiphopopotamus vs. Rhymenoceros," and MC Chris' "I Want Candy." I gave these songs a digital thumbs up, which marks them in a playlist so I can find them later.

Google Play Music attempts to do something that Samsung Electronics Co.'s Music Hub did before it. Music Hub, which launched last July on Samsung's Galaxy S III phone, blended four things: a music store, an online storage service, unlimited song streaming and an Internet radio player.

Google's app does all those things. In addition, because it comes as an update to the existing Google Play Music app, it preserved the music I took the trouble of uploading to my Google Music storage space prior to the revamp.

When Google first launched its music store in November 2011, it merely sold songs or albums a la carte. But it offered users free online storage for up to 20,000 songs, including ones they had bought at other stores such as Apple's iTunes.

Starting last December, Google's uploader software added the ability to scan your hard drive for songs and match them with songs Google already has on its servers. That way, you have to upload only the songs Google didn't recognize. With that, your personal library of owned songs still exists, but the sense of ownership has blurred.

With All Access, you still see your library of owned songs in a place called My Library on the Google Play Music app. A lot of that music is stored online, or in the cloud, and requires an Internet connection to listen to. But you can "pin" a song to download a copy for offline listening, something that Google Play Music and other cloud lockers had offered already.

You can toggle the view in My Library to see everything you can access in the cloud, or just the stuff you can access on the device without a cellular or Wi-Fi connection. If you start running out of space, you basically "unpin" the song to free up the memory, even though your ownership still exists in the cloud.

All Access also allows you to "pin" songs you don't own. Copies will get downloaded for offline play. Or you can mark songs as favorites by adding them to My Library in the cloud. But because those favorites are stored in the same place as songs you actually own, your sense of ownership will suffer a hit. You might not know which is which until the All Access songs disappear should you ever stop paying the monthly fee.

You can share songs from the app to the Google Plus social network, but there's no Facebook  (NASDAQ: FB  ) integration as is the case with Spotify and Rhapsody. It also doesn't integrate with Twitter's new (hash)music service, the way Rdio and Spotify do quite well.

Google's new music service covers the fundamentals of unlimited on-demand music with Google-like solid execution. And with the radio function running on Google's vaunted ability to tweak algorithms, it adds a healthy dose of serendipity to the mix, turning up songs and artists I wouldn't have discovered on my own.

That puts it at least on an equal footing with streaming services that have come before it and will persuade some subscribers of those services to switch. Although you need an Android phone to use All Access fully, I don't believe that in itself will get Apple (NASDAQ: AAPL  ) fans to drop their iPhones. But it's one more nice thing Android has going for it.

Best Buy or hhgregg: Which Will Be the First to Go?

The following video is from Tuesday's Investor Beat, in which host Chris Hill and analysts Jason Moser and Jeff Fischer dissect the hardest-hitting investing stories of the day.

Best Buy and hhgregg are bricks-and-mortar electronics retailers that are struggling for survival. Both reported earnings with very different results. Best Buy showed encouraging signs of growth in online sales while reducing costs. Meanwhile, hhgregg's fourth-quarter profits fell 82%. In this installment of Investor Beat, Motley Fool analysts Jason Moser and Jeff Fischer discuss the electronics retail industry and why investors should steer clear of both stocks. Also, our analysts take a look at the four stocks making the biggest moves on Tuesday's market, and two stocks investors should have their eyes on this week.

The brick-and-mortar vs. e-commerce battle wages on, with Best Buy caught in the middle. After what might have been its most tumultuous year in history, there are now even more unanswered questions about the future for the big-box electronics retailer. How will new leadership perform? Will a smaller store format work out for both the company and its brave investors? Should you be one such brave investor? To help answer all these questions, The Motley Fool has released a premium research report detailing the opportunities -- and the risks -- in store for Best Buy. Simply click here now to claim your comprehensive report today.

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More Expert Advice from The Motley Fool

The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.

Why Rio Tinto, E2V Technologies, and Porvair Should Beat the FTSE 100 Today

LONDON -- After a bearish day yesterday, the FTSE 100 (FTSEINDICES: ^FTSE  ) is falling further today, down 0.51% to 6,311 as of 10:40 a.m. EDT. This is the index's third straight session of losses, with the banks among the biggest fallers -- though the miners are enjoying a bit of a rebound after a tough day yesterday.

But which companies are beating the trends today? Here are three from the various FTSE indexes that are picking up.

Rio Tinto
Rio Tinto got a welcome boost from its first-quarter operations review, with shares in the diversified miner picking up 0.42% to reach 2,987.5 pence. Although a pit wall slide at Bingham Canyon will adversely affect copper production this year, the firm managed a first-quarter record for iron-ore production, turning out 61.2 million tonnes of the stuff -- although that was down on the preceding fourth-quarter.

Cost reduction measures are apparently going to plan, with chief executive Sam Walsh talking of "our pursuit of greater value for shareholders."

E2V Technologies (LSE: E2V  )
Specialist electronics provider E2V Technologies has seen its shares perk up 4.6% to 119 pence after the firm issued a positive 2013 year-end update in which chief executive Keith Attwood said: "The full-year trading performance is anticipated to be in line with expectations. ... We have significantly reduced net borrowings and we have built the order book to record levels."

The company's order book stood at 195 million pounds at year-end, up 37%, with orders worth 130 million pounds scheduled for delivery over the next 12 months. Net debt was reduced during the period from 30 million pounds to just 10 million pounds. Current expectations put the shares on a price-to-earnings ratio of 11, with a dividend yield of 3.5% expected.

Porvair (LSE: PRV  )
Shares in Porvair have gained 3.2% to 228 pence this morning, taking them up about 90% over the past 12 months. The rise today owed to a couple of things. At its annual general meeting, Porvair, which specializes in filtration and environmental-control technology, told us it has made a good start to 2013, with revenue about 6% ahead so far.

There was also news of a new contract: The company has received an 11 million pound order from the U.K. government -- which comes on top of an order from India's Reliance Industries, announced in February.

Finally, if you're looking for investments that should take you all the way to a comfortable retirement, I recommend the Fool's special new report detailing five blue-chip shares. They'll be familiar names to many, and they've already provided investors with decades of profits. But the report will only be available for a limited period, so click here to get your hands on these great ideas -- they could set you on the road to long-term riches.

Twitter, News Corp, Sotheby’s are stocks to watch

Getty Images Twitter shares are expected to see active trading in Monday's session.

SAN FRANCISCO (MarketWatch) — Among the companies whose shares are expected to see active trade in Monday's session are Twitter Inc., News Corp, and Sotheby's.

After skyrocketing more than 70% on its market debut, Twitter (TWTR)  gave up 7.2% on Friday, its second day of trading, drawing even more comparisons with Facebook Inc. (FB) . Like Twitter, Facebook's initial public offering in May 2012 had been the marquee IPO of the year. But after a first day pop, the stock failed to live up to the hype and traded below its IPO price of $38 until earlier this year when investors saw visible proof that the company's monetization effort was bearing fruit

Twitter faces much of the same obstacles in convincing skeptics that it has a viable product in its microblogging service, and its key task will be to demonstrate that it can continue to attract enough active users to continue growing its revenue.

Click to Play Barron's Buzz: Protect your portfolio

Long-term care insurance has gotten a bad rap. Plus, how fast is your online broker? Photo: Getty Images

"Twitter is likely in the early innings of its growth. We believe that the majority of the world's 2.4 billion Internet users have great potential to find something or someone on Twitter that they are interested in," Michael Pachter, an analyst at Wedbush, said in a report.

He initiated coverage of Twitter's with a neutral rating and a price target of $37.

On the earnings front, News Corp (NWSA)  is expected to report fiscal first-quarter earnings of 5 cents a share, according to a consensus survey by FactSet. In June, the media company separated its entertainment arm to operate as 21st Century Fox Inc. (FOXA)  while the publishing business retained the News Corp name. News Corp owns The Wall Street Journal and MarketWatch, the publisher of this report.

Sotheby's (BID)  is projected to report a loss of 47 cents a share in the third quarter.

Assured Guaranty Ltd. (AGO)  is forecast to post third-quarter earnings of 63 cents a share.

Dow Dividends Enter Their Traditional Summer Lull

The Dow Jones Industrials (DJINDICES: ^DJI  ) is well known for giving income investors the dividend increases they like to see. All 30 Dow stocks pay dividends, and many of them consistently increase their quarterly payouts year after year. Interestingly, though, the timing of those dividend increases throughout the year reflects uneven patterns. After American Express (NYSE: AXP  ) and Caterpillar (NYSE: CAT  ) pay out their recently declared higher dividends in the next couple of weeks, Dow investors could go quite a while without seeing another increase.

The patterns of Dow dividend stocks
In general, stocks that consistently make annual dividend increases fall into predictable patterns of behavior over the years. A large group of dividend stocks don't waste any time boosting their payouts, increasing dividends in the first quarter of the year. Another common alternative is to wait until the end of the year to ensure that a company's profits are up to par and then make the decision to raise the payout.

We've seen that pattern play out in recent quarters. During the first quarter of 2014, a record 1,078 companies tracked by S&P Dow Jones Indices made positive dividend moves, either increasing existing dividends or declaring new ones for the first time. By contrast, only 102 companies made dividend cuts or eliminated their payouts entirely. The dollar value of those increases and newly declared dividends added up to more than $19.7 billion.

Similarly, in the fourth quarter of 2013, 885 companies raised their dividends. That was actually down sharply from the 1,266 companies with dividend increases in late 2012, but that was likely because of the concerns about the fiscal cliff-induced tax hikes that raised the maximum dividend tax rate from 15% in 2012 to 20% in 2013.

Source: Wikimedia Commons.

If old patterns hold true, then we've likely seen the last dividend increases for a while in the Dow Jones Industrials. American Express announced its 13% dividend increase in May, although the ex-dividend date for that payment won't be until July 11, and the actual cash won't get paid out until early August. Similarly, Caterpillar just announced last week its latest dividend increase, boosting its payout by a dime per share or 17% with an ex-dividend date in mid-July and payment to be made August 20.

Surprises ahead?
Of course, there are a few dividend stocks that haven't raised their payouts in a while, and they could choose to get back on the dividend-increase bandwagon. Intel has held steady with its dividends for eight straight quarters now, while DuPont has a five-quarter streak of unchanged payouts. As both consider major moves to bolster their growth, now could be a good time to consider rewarding shareholders for their patience.

What's more likely, though, is that Dow investors will simply have to accept a break from higher payments for a few months. By the time the holiday season approaches, more Dow stocks will start considering dividend increases once again.

Top dividend stocks for the next decade
The smartest investors know that dividend stocks simply crush their non-dividend-paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.