A Missed Opportunity Leads to Learning

Compared to many of my compatriots here at The Motley Fool, I am still relatively new to investing. Prior to last year, my investing experience was limited primarily to mutual funds, with some light dabbling into individual stocks. I had some successes along the way, but my "trader" mentality often got the best of me and led me to sell my shares on a whim, buying or selling based on price and not a whole lot else.

I like to think that I've shifted my mentality a bit over the past 18 months. I feel more like an investor than ever before, and plan on holding onto many of my investments for a long time. Once I make an investment decision, I try to avoid thinking about other opportunities that I let slip away. Alas, I am human, and my choice of Under Armour (NYSE: UA  ) last year over a group of other qualified candidates has had me thinking recently about the way I make investment decisions. Instead of dwelling on the missed gains, however, I decided to learn from the decision and adjust my thinking going forward.

A bit of history
Last August, I identified five companies that I was considering adding to my portfolio, and spent the month looking at various reasons why they would have made great additions to my portfolio. I ultimately went with Under Armour, and while the other stocks remained on my watchlist, I decided to turn my attention to following Under Armour more closely.

Nevertheless, the performance of the other companies on the list over the past eight months has been hard to ignore, so I decided to take a look how each of the candidates has fared since I made my decision, and it is no wonder that I hope for what could have been:

Source: UA data by YCharts.

What can you do?
While it is slightly disheartening to have missed out on the great performance from three of these companies, I have no regrets. I still think Under Armour will be a winner in the long run, and remain committed to the company and CEO Kevin Plank. With a long-term horizon and no need to access these funds for quite some time, I view this eight-month snapshot as a learning opportunity more than anything else.

Personally, I look back on my decision last September and wonder if I missed something about Netflix (NASDAQ: NFLX  ) . I honestly thought it was an acquisition candidate, and wouldn't remain as an independent company for much longer. Instead, the company continues to add subscribers, including a robust 3 million during its most recent quarter, and could put up similar results going forward with the return of Arrested Development later this month. I just have to file this in the "lessons learned" category and continue to look for opportunities.

What have I learned?
Over the remainder of my investing life, this one decision will most likely be trumped by others I make along the way. In the meantime, while my overall investing philosophy hasn't changed, there is one thing that I learned last September: You shouldn't wait for a better price or valuation before investing in a company.

I bypassed two companies in favor of Under Armour -- Amazon.com (NASDAQ: AMZN  ) and LinkedIn (NYSE: LNKD  ) -- primarily because of their sky-high valuations at the time. LinkedIn has only gone higher since then, and Amazon would have as well if capital expenditures over the past year hadn't led to a loss over the past 12 months. Nevertheless, LinkedIn is the latest addition to my portfolio, and Amazon will probably join it sometime over the next few months. Warren Buffett still laments about waiting for a better price when he bought Wal-Mart, and as much as I'd like to be like Buffett, I think I'll learn a bit from him instead and not let valuation weigh as heavily on my investment decisions.

The bottom line
I don't think that investors should second-guess every investment decision, but instead view certain instances as an opportunity to learn and further strengthen an investment thesis. By looking back at my decision from September, my conviction about Under Armour was reinforced, and I was reminded why I chose it in the first place. Though I may have missed out on the great performance of three other companies, I also learned an important lesson about the difference between trading and investing. This lesson should continue to serve me well throughout the rest of my life.

The best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.

Did Monsanto Just Ruin the Economy?

They said it couldn't happen. It was all supposed to be locked up tight and under control. Yet, despite all the assurances to the contrary, unapproved genetically modified wheat has been found in an Oregon wheat field, and the implications of its discovery are far-reaching and potentially devastating. Monsanto (NYSE: MON  ) may have just single-handedly wrecked the wheat industry and the economy.

Corn, soy beans, alfalfa, sugar beets. All these crops have been genetically modified by Monsanto and its GM brethren to the point where there are virtually no alternatives for farmers. GM corn accounts for 86% of the country's supply. More than 90% of the soy beans have been altered. Sugar beets are half the country's sugar supply, and 95% of those seeds are from Monsanto.

All told, Monsanto, DuPont  (NYSE: DD  ) , and Syngenta  (NYSE: SYT  ) control 53% of the world's seed production, yet their control of our food supply is almost all-encompassing, because they cross-license their technology between themselves and with other companies.

Monsanto recently agreed to share its technology with Dow Chemical  (NYSE: DOW  )  and Bayer (and vice versa), while DuPont and Bayer similarly expanded their collaboration. Syngenta is cross-pollinating Dow's AgroSciences division with its GM technology.

Yet, the one crop that has been saved from being altered up until now has been wheat. Not that Monsanto hasn't tried, as it experimented with modifying its DNA to make it resistant to its Roundup herbicide. Fields in 16 states including Arizona, California, Florida, Nebraska, and Oregon were used to test Roundup Ready wheat seed. But because the rest of the world has banned GM wheat from their bread boxes, Monsanto backed off, and suspended the program in 2005.

The wheat strain discovered last month was in a field that was supposed to remain fallow. Instead, it sprouted, and was found to contain the Roundup Ready gene, even though the Agriculture Dept. supposedly destroyed all the seed that was tested except for a small amount it kept to run additional tests. Now we learn that some managed to escape.

The U.S. is, by far, the world's largest exporter of wheat, shipping almost 28 million metric tons around the world, or about half of all the wheat this country produces each year. That's just as much as all of Europe and Canada combined! Countries like Japan and South Korea are huge importers of U.S. wheat, but it's done on one condition: the wheat can't be genetically modified.

In the wake of the discovery of this supposed rogue GMO strain, Japan began canceling wheat imports, and so did South Korea. Both Taiwan and Europe are stepping up their monitoring of imports with an eye toward suspending them if genetically modified wheat is found. With 90% of the wheat from Oregon, Washington, and Idaho earmarked for export, the emergence of a GMO strain could cripple the market for it and, thus, the economy.

While officials immediately proclaimed it an isolated incident, how do they know that? They can't even say how it got into the field in the first place, but we're supposed to believe it's not widespread. 

While Monsanto speculates it could be "sabotage," with the toothpaste out of the tube, it's easy to devise an equally sinister explanation, one that actually benefits Monsanto. Sure, foreign countries would initially reject U.S. exports of GM wheat; but where would they turn to make up half of the world's supply? And when it becomes a choice of feeding their people or starvation, it may ultimately lead to acceptance of genetically modified wheat. And once that happens, Monsanto controls the world's wheat supply. Tinfoil hat brigade stuff to be sure, but no more outlandish than Monsanto's supposition.

Despite assurances that GM foods are safe to eat, this latest incident underscores why it's so important that such foods are labeled that they've been altered at the molecular level. Individuals should have a choice as to whether they ingest GM foods or not, but Congress has seen fit to protect Monsanto at every turn by keeping consumers in the dark.

When it comes to the nation's bread basket, this country's wheat supply and its economy need to be saved from Monsanto.

There are multinational companies that seek world domination through less controversial means, and profiting from our increasingly global economy can be as easy as investing in your own backyard. The Motley Fool's free report, "3 American Companies Set to Dominate the World," shows you how. Click here to get your free copy before it's gone.

Top High Tech Companies To Watch For 2014

Three out of four blue-chip stocks backtracked on Monday as Wall Street considered June's slip in U.S. home orders and anticipated the beginning of the two-day Federal Open Market Committee meeting tomorrow. The slowdown in home sales, while sounding ominous, should be taken with a grain of salt: Sales fell just 0.4% from May, when they reached a six-and-a-half-year high. The Fed, while expected to keep rates absurdly low this week, has investors on edge as markets worry loose money policies may be ending soon. The Dow Jones Industrial Average (DJINDICES: ^DJI  ) fell 36 points, or 0.2%, to end at 15,521.�

Caterpillar (NYSE: CAT  ) stock refused to lose -- as it had in the previous four trading sessions -- and added 1.2% after announcing a $1 billion share buyback plan. The shares in particular will be bought back from a French bank. With a market cap around $54 billion, the repurchase agreement will materially reduce the number of shares outstanding, spreading the company's earnings among a smaller pool of shareholders. Caterpillar seems to think its stock is pretty cheap right now. It also bought back $1 billion of its stock in June.�

Top High Tech Companies To Watch For 2014: Transurban Group(TCL.AX)

Transurban Group engages in the development, operation, and maintenance of toll roads in Australia and the United States. It operates various roads, such as CityLink, Victoria in Australia; Hills M2 Motorway, Lane Cove Tunnel, M1 Eastern Distributor, M5 Motorway, and Westlink M7, New South Wales in Australia; and Pocahontas 895 and Capital Beltway Express in the United States. The company was founded in 1996 and is headquartered in Melbourne, Australia.

Top High Tech Companies To Watch For 2014: SciQuest Inc.(SQI)

SciQuest, Inc. provides an on-demand strategic procurement and supplier enablement solution worldwide. The company?s solution integrates its customers with their suppliers for automating the source-to-settle process. Its solution include various modules, such as sourcing director, spend director, requisition manager, order manager, settlement manager, supplier contract management and authoring, total supplier manager, supplier diversity manager, and materials management. The company delivers its solutions over the Internet using a software-as-a-service model. It serves higher education, life sciences, healthcare, state and local government entities, and commercial customers through direct sales force. SciQuest, Inc. was founded in 1995 and is headquartered in Cary, North Carolina.

Top Penny Stocks For 2014: Great Pacific International Inc(GPI.V)

Great Pacific International Inc., a junior oil and gas company, engages in the exploration and development of oil and gas properties. It holds interests in properties located in Alberta, Canada; and Texas, the United States. The company was incorporated in 1993 and is based in Ladner, Canada.

Top High Tech Companies To Watch For 2014: Groupon Inc (GRPN)

Groupon, Inc. (Groupon) is a local e-commerce marketplace that connects merchants to consumers by offering goods and services at a discount. Each day the Company e-mails its subscribers discounted offers for goods and services that are targeted by location and personal preferences. Consumers also access its deals directly through its Websites and mobile applications. The Company operates in two segments: North America, which represents the United States and Canada; and International, which represents the rest of its global operations. Customers purchase Groupons from the Company and redeem them with its merchants. As of September 30, 2011, the Company featured deals from over 190,000 merchants worldwide across over 190 categories of goods and services. Groupon primarily addresses the worldwide local commerce markets in the leisure, recreation, foodservice and retail sectors. In February 2012, the Company announced the launch of Groupon Thailand. In September 2012, it acquired Savored.

In May 2010, the Company acquired CityDeal Europe GmbH (CityDeal). In August 2010, the Company acquired Qpod.inc (Qpod). In November 2010, the Company acquired Ludic Labs, Inc., a company that designs and develops local marketing services. During the year ended December 31, 2010, the Company acquired Mobly, Inc. In February 2011, the Company launched Deal Channels, which aggregates daily deals from the same category.

The Company distributes a featured daily deal by e-mail on behalf of local merchants to subscribers. It offers daily deals from more than 40 national merchants, including Bath & Body Works, The Body Shop, Hyatt Regency, InterContinental Hotels, Lions Gate, Redbox, Shutterfly and Zipcar across subsets of the North American market. Daily deals that do not appear as a featured daily deal appear as Deals Nearby. Each Deal Nearby is summarized in fewer than 20 words next to the featured daily deal. Deals Nearby often extends beyond the subscriber's closest market or buying preferences.

National merchants also have used the Company�� marketplace as an alternative to traditional marketing and brand advertising. On August 19, 2010, the Company e-mailed and posted a Groupon daily deal offering $50 of apparel at Gap for $25 to 9.2 million subscribers across 85 markets in North America. It sold approximately 433,000 Groupons in 24 hours. Of the consumers who purchased Groupons, approximately 200,000 were new subscribers. As of September 30, 2011, it had 142.9 million subscribers to its daily e-mails.

Groupon NOW is a deal initiated by a merchant on demand and offered instantly to subscribers through mobile devices and its Website. Subsequent to the year ended December 31, 2010, the Company launched Groupon NOW in 25 North American markets. Deal Channels aggregate daily deals from the same category and are accessible through its Website and through e-mail alerts that subscribers sign up to receive. It offers Deal Channels in home and garden and event tickets and travel. Merchants can register their deals to be included in a Deal Channel. Subscribers can use Deal Channels to focus on deals that are of interest to them.

Self-Service Deals allows the Company�� merchants to use a self-service platform to create and launch deals at their discretion. The use of the platform is free and allows merchants to establish a permanent e-commerce presence on Groupon that can be visited and followed by subscribers. The Company receives a portion of the purchase price from deals sold through Self-Service Deals based on the extent to which it marketed the deal. In December 2010, it launched Self-Service Deals in selected North American markets.

Groupon Goods enables consumers to purchase vouchers for products directly from its Website. The Company e-mails deals for Groupon Goods weekly to a targeted subscriber base. The Company offers deals for a variety of product categories, including electronics, home and garden and toys. In September 2011, the Compa! ny launch! ed Groupon Goods in select North American and International markets.

Groupon Rewards enables consumers to unlock special Groupon deals from local merchants through repeat visits. Consumers earn reward points at participating merchants by paying with the credit or debit card they have registered with the Company. Merchants set the amount the consumer must spend to unlock a reward deal, and once a consumer is eligible to unlock a deal, it automatically notifies them. The Company distributes its deals directly through several platforms: a daily e-mail, its Websites, its mobile applications and social networks.

In December 2010, the Company partnered with Redbox to offer a daily deal to their user base and it acquired over 200,000 new customers through that offer and in March 2011, it partnered with eBay to offer a daily deal to their user base and it acquired over 290,000 new customers through that offer. The featured daily deal e-mail contains one headline deal with a full-description of the deal and often contains links to More Great Deals Nearby, all of which are available within a subscriber's market.

Visitors are prompted to register as a subscriber when they first visit its Website and thereafter use the Website as a portal for featured daily deals, Deals Nearby, national deals, and where available, Deal Channels and Self-Service Deals. Consumers also access the Company�� deals through its mobile applications, which are available on the iPhone, Android, Blackberry and Windows mobile operating systems. It launched its first mobile application in March 2010. The Company publishes its daily deals through various social networks and its notifications are adapted to the particular format of each of these social networking platforms.

Groupon competes with Google, Microsoft, Eversave, BuyWithMe and LivingSocial.

Advisors' Opinion:

• [By Jonas Elmerraji]

  Nearest Resistance: $6.50
  
  Nearest Support: $5.25
  
  Catalyst: Earnings Beat

  It's a rare double-digit day for Groupon (GRPN) today -- at least as of this writing -- following an earnings beat for the first quarter of 2013. Groupon has been a perennial underperformer since its IPO in late 2011, and the 76% decline in the stock's price since going public is proof of that. But the 3 cents per share that the firm earned for the quarter bested investors' expectations, and that's all it took to spur a move higher in the stock.

  It's a little too early to call today's price action the start of something. From a technical standpoint, today's 10% jump higher isn't particularly important -- shares are still sitting in between resistance at $6.50 and support down at $5.25. And with GRPN's price fading this afternoon, I wouldn't exactly recommend throwing money at this stock right now. Caveat emptor.

3 Shipping Stocks Set to Sail in the Right Direction

The global economy becomes more closely knit each year. The economic expansion of quickly developing countries requires resources to fuel the fire, and lots of them. The most efficient way to transport mass quantities of raw materials is through dry bulk shipping using large vessels. Assuming that teleportation devices won't be introduced anytime soon, the bulk shipping industry is here for the long haul.

Shipping services are all fairly standard: The materials are loaded, shipped, and unloaded. Therefore it is difficult for a company to differentiate itself based on quality of service, so other avenues such as rate competitiveness and cost efficiency become big factors in a company's success. A great example of a company doing just this is DryShips (NASDAQ: DRYS  ) .

The good
Through what has been a difficult period for shipping stocks, DryShips has done a great job growing revenues. Over the past two years, revenues have been growing year over year at relatively high rates and have hit $319.7 million, a 29% increase over the same quarter last year. The fact that DryShips can maintain revenues during an imbalanced period of supply and demand gives the company a promising outlook.

DRYS Revenue Annual YoY Growth data by YCharts

Furthermore, the shipping industry is cyclical, with the fall and winter seasons typically being busier. DryShips has seen steadily increasing days in deferred revenues, indicating that it has plenty of business coming in even during the spring and summer seasons. This is a very healthy sign since many other shipping companies are struggling or shutting down entirely during off-peak seasons.

A smooth operator
Just as DryShips is able to generate revenues during off-peak seasons, it is important for a company to be able to maintain healthy operating margins throughout the year. Another shipping company doing a good keeping these margins open despite lower revenues is Diana Shipping (NYSE: DSX  ) . As seen in the chart above, revenues have been dwindling, but that does not mean management is not doing its part.

Although there is a steady downward trend, Diana Shipping is doing all that it can in the saturated market to keep operating margins positive while weathering the storm. The diminishing revenues are being combated with lower operating expenses as well, particularly during the off-peak seasons. The strategy now is to operate almost exclusively during peak seasons, which is different from the past where vessels were in constant operation to answer the high shipping demand.

DSX Operating Margin TTM data by YCharts

The current demand for shipping is being hurt by the slowing economies of China and India. With that in mind, Diana Shipping is focused on keeping costs low and exploring low-cost investments, such as acquiring new vessels. By adding to its fleet during an inexpensive time, Diana hopes to reward investors with extremely lucrative cash flows once the shipping business picks back up.

Shape up or ship out
The two companies above have done a relatively great job at staying proactive during a troubled time, and Eagle Bulk Shipping (NASDAQ: EGLE  ) is doing its best to follow suit. After putting up very strong earnings last quarter, reporting $72.2 million net revenue, compared with $52.6 million for the same quarter last year, Eagle looks to be on the right track.

Investors should also be aware of a drastic drop in Eagle's deferred revenues, which accompanied the increase in revenues last quarter as well. Deferred revenue is an indicator of how much work a company has to fulfill, and increasing numbers are usually healthy. The large drop in deferred revenue could indicate possible changes to revenue recognition and is a warning sign to keep an eye on.

Going up?
All of these stocks are at very low prices despite the fact that the market is at an all-time high. This is because the bulk shipping industry is seeing supply and demand factors that are severely out of order, which the industry is looking to correct in the near future. The Baltic Dry Index, a major indicator of the shipping industry, is currently just under 1,100, down from a high of 11,800 in May 2008. If demand follows current trends and picks up, these stocks could have a lot of room to run.

If you're afraid shipping stocks could sink further, then check out the company that The Motley Fool's chief investment officer has selected as his No. 1 stock for this year. Find out which stock it is in the special free report: "The Motley Fool's Top Stock for 2013." Just click here to access the report and find out the name of this under-the-radar company.

How Henry Ford's Family Still Controls Ford

It has been a public company since the 1950s, but Ford (NYSE: F  ) is unique among Detroit automakers in that it's still a family business. Chairman Bill Ford is founder Henry Ford's great-grandson, and in recent years he has done an excellent job of setting the company's overall direction.

But many Ford fans and investors don't know that Bill Ford is backed by a very powerful force -- the rest of the Ford family, which to this day still has control thanks to a special class of stock created when Ford first went public.

In this video, Fool contributor John Rosevear explains how the special Ford shares give the Ford family a huge voice in how the automaker is run -- and whether that's a good thing for the rest of Ford's shareholders.

China is already the world's largest auto market -- and it's set to grow even bigger in coming years. A recent Motley Fool report, "2 Automakers to Buy for a Surging Chinese Market," names two global giants poised to reap big gains that could drive big rewards for investors. You can read this report right now for free -- just click here for instant access.

Are Canadian Oil Sands More Prone to Disastrous Spills?

A lot of people don't look favorably on crude oil produced in Alberta's oil sands. In addition to the fact that oil sands production spews greater quantities of greenhouse gases into the atmosphere, some have voiced concerns about the physical and chemical properties of the oil.

That's because oil sands crude contains something called bitumen -- a thick, viscous substance that doesn't flow unless it's heated or diluted. For bitumen to be shipped by pipeline, it needs to be diluted with specialty chemicals to produce diluted bitumen, or "dilbit" crude.  

Some argue that dilbit crude is much more corrosive than other types of crude oil and that pipelines transporting it are more susceptible to leaks. But a new study by the National Research Council argues otherwise. Let's take a closer look.

Dilbit crude and leak risks
According to a committee of scientists reporting to the U.S. Department of Transportation, diluted bitumen doesn't pose a higher risk of leaks than other types of crude oil when transported by pipeline.

Scientists found no evidence that dilbit crude has physical or chemical properties that are materially different from that of other crude oils or that would make a pipeline transporting dilbut crude more susceptible to leaks, the NRC said.

The report, which came out June 25, confirms findings from a June hearing last year, in which crude oil transportation experts argued that dilbit upgraded from Canada's oil sands is physically and chemically similar to other varieties of sour crudes.

No mention of environmental impact
Importantly, however, the study focused mainly on whether transporting dilbit crude increased the risk of pipeline leaks. It didn't investigate whether the environmental impact of dilbit crude spills is more severe than spills involving other types of crude oil. Perhaps it should have, because what few examples exist indicate that the stuff is a real hassle to clean up.

Consider the rupture of an Enbridge (NYSE: ENB  ) pipeline, which discharged roughly a million gallons of bituminous crude into Michigan's Kalamazoo River in June 2010. Though three years have passed, the cleanup effort still isn't over. Enbridge employees and state and federal environmental crews continue to test the river, where sheen and clumps of oil still linger. The company reported a 4% year-over-year decrease in its first-quarter net income, partially because of the escalation of cleanup costs related to the spill, which are now approaching a whopping $1 billion.

Similarly, environmental damage from the rupture of an ExxonMobil (NYSE: XOM  ) pipeline carrying bituminous crude oil near Mayflower, Ark., has also been quite devastating, according to several local residents. Dozens of property owners and residents have sued Exxon, alleging that the spill has caused them numerous health problems, including nausea and headaches, as well as property damage and declines in property values.

In addition, Arkansas and federal officials filed a lawsuit against Exxon in June, alleging that the company violated numerous state and federal statutes, including Arkansas' Water and Air Pollution Control Act, its Hazardous Waste Management Act, and the federal Clean Water Act. Depending on the outcome of the case, Exxon could face civil fines ranging from $10,000 to $25,000 a day and federal Clean Water Act violation fines of up to $4,300 per barrel of oil spilled.  

Perhaps more worrying, though, is the alleged lack of transparency in the investigation of the spill's aftermath and cleanup efforts. In the weeks following the spill, several sources reported that the entire affected area was cordoned off and that some news reporters were rejected access to film and inspect the damage.

This strategy of downplaying the environmental impact of a major oil spill is quite reminiscent of what BP (NYSE: BP  ) did in the aftermath of the 2010 Gulf of Mexico oil spill, when former CEO Tony Hayward suggested that the spill was nothing more than a drop in the ocean. Three years later, the facts paint a different picture; the 2010 Gulf spill is widely regarded as the worst accidental oil spill in history.

The bottom line
All told, while the NRC studies results suggest that bituminous crude oil is no more prone to spills than other types of crude oil, it doesn't say anything about the environmental impact of dilbit crude spills. In my view, this is something that deserves further analysis.

While environmentalists and climate-change groups are sure to be dismayed by the study's results, the committee's findings are good news for TransCanada (NYSE: TRP  ) , which is seeking U.S. federal approval to construct the northern portion of its Keystone XL pipeline.

President Obama is widely expected to approve the pipeline this summer, though he added that he would greenlight the project only if  it "does not significantly exacerbate the problem of carbon pollution."

With crude oil prices having avoided the broader sell-off in commodities, now might be a good time to pay attention to some high-quality, oil-levered stocks. If you're on the lookout for some currently intriguing plays, check out The Motley Fool's "3 Stocks for $100 Oil." For free access to this special report, simply click here now.

The Top 10 Most "All-American" Cars Are Shockingly Japanese

As the auto industry rapidly changes, distinctions that were once clear in terms of which cars or manufacturers are truly "American" have blurred. Domestic brands have been bought and sold by foreign companies, while many Japanese automakers boast significant production from domestically located factories. 

Cars.com has created its own system, the American-Made Index, which considers a variety of factors in determining which vehicles have the most red, white, and blue in their veins. 

While rankings like this may seem irrelevant to investors, big-ticket purchases such as automobiles and homes are often done with the heart and not the head. Many people buy domestically manufactured vehicles on principle, and being "more American" can be as important a car's price and features.

A high ranking in one direction or another can boost loyalty and pricing power as well.

Considering all of these factors, I selected the best automaker for a recovering U.S. auto industry in the following slide show.

But don't stop there. If you want to make real money, go global and uncover the 2 Automakers to Buy for a Surging Chinese Market. You can access these two picks free today -- just click here now. 

American vs. Foreign Cars from The Motley Fool

OfficeMax Keeps Dividend Steady

Office supplies retailer OfficeMax (NYSE: OMX  ) announced yesterday its third-quarter dividend of $0.02 per share, the same rate it's paid for the past four quarters after slashing the payout 87% from $0.15 per share.

The board of directors said the quarterly dividend is payable on Aug. 30 to the holders of record at the close of business on Aug. 15. The office supplies retailer paid a special dividend of $1.50 per share last month. It is in the midst of being acquired by Office Depot for $1.2 billion.

The regular dividend payment equates to an $0.08-per-share annual dividend, yielding 0.7% based on the closing price of OfficeMax's stock on July 25.

OMX Dividend data by YCharts. Chart reflects special dividend of $1.50 that was paid in June 2013 and does not include the just-announced payment.

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Las Vegas Sands Is Still Gaming King

The headline numbers for the second quarter look pretty outstanding for Las Vegas Sands (NYSE: LVS  ) . Net revenue increased 25.6%, to $3.24 billion, hold-adjusted property EBITDA was up 29%, to $1.17 billion, and net income was up 42.1%, to $597.6 million. But a deeper dive into the numbers show at least a little disappointment in the quarter. 

The good and bad in Macau
Macau was a different story depending on where you looked. Sands Cotai Central is finally starting to generate the gaming volume Sheldon Adelson envisioned, but ran into bad luck; The Venetian Macau saw mass market play jump, and had good luck with high rollers, and Sands Macau continues to slowly fall victim to Cotai.

The best way to analyze the numbers is to look at rolling chip volume (high roller play), non-rolling chip volume (mass market table games), and slot handle at the company's casinos. For some perspective on the growth each component displayed, remember that Sands Cotai Central wasn't fully open, so a better gauge than growth there is comparing figures to The Venetian Macau, and Macau's overall revenue was up 15.8% in the quarter.

 

Rolling Chip Volume

Non-Rolling Chip Volume

Slot Handle

Venetian Macau	$11.84 billion +6.1%	$1.59 billion +56.1%	$1.15 billion +0.1%
Sands Cotai Central	$14.34 billion +110.2%	$1.23 billion 215.4%	$1.25 billion +87.8%
Four Seasons Macau	$9.94 billion 8%	$186.1 million +104.5%	$182.0 million -8.6%
Sands Macau	$5.82 billion -5.6%	$822.9 million +14.8%	$637.2 million +4.2%
Total	$41.94 billion +25.7%	$3.83 billion +72.7%	$3.22 billion +22.6%

Source: Las Vegas Sands Q2 2013 earnings release.

We can see that the center column is the strongest, which means that mass-market play is growing, especially on Cotai. What's a little less clear is how much growth we can expect in the high roller business on Cotai. The Venetian Macau and Four Seasons both experienced relatively slow growth rates in high-end play and negative growth in slots.

With that said, overall volume growth was strong for Las Vegas Sands, and the company clearly took share from Wynn Resorts, Melco Crown, and MGM Resorts  over the past year.

When looking at other operators that will report earnings over the next few weeks, we can see trends toward Cotai continue. That will hurt Wynn and MGM until their Cotai resorts are complete, and likely help Melco Crown's results again this quarter. 

Singapore disappoints
The real disappointment right now is Singapore, where Marina Bay Sands isn't generating the profit Sheldon Adelson expected when he built the resort. There was hope the resort would generate $2 billion in EBITDA and, after generating $1.72 billion in EBITDA from Q2 2011 to Q1 2012, that looked possible. But revenue growth has slowed, and the resort has only generated $1.32 billion in EBITDA over the past year. 

That's still a big figure, but when your company is valued at 12 times EBITDA, a $700-million shortfall from expectations priced into the stock can be a drag.

A new cash king
What's new for gaming companies lately is returning money to shareholders through dividends and share repurchases. Extra cash was used for growth until recent years, but with the sheer cash Macau casinos are spitting off, Las Vegas Sands and Wynn are able to pay back shareholders.

In Las Vegas Sands' case, that means a $0.35 per-share quarterly dividend and a new $2.0 billion share buyback program. The company is also steadily lowering its debt, which now stands at $9.49 billion. This greatly reduces the company's risk and provides some stability for shareholders in the future.

To buy or not to buy?
Despite the drop in shares today, I think this was a pretty good quarter for Las Vegas Sands. The company is growing steadily in Macau, and disappointing results in Singapore and Las Vegas were both affected by lower-than-expected winning percentages. That will adjust over time, and even though Singapore may not be as big as Adelson once expected, it's still an amazingly profitable casino.

My only reservation with the stock is its price. Las Vegas Sands's enterprise value is 12.3 times EBITDA, which is well higher than a 9.5 ratio for Wynn, and 9.8 for MGM Resorts. Melco Crown is higher at 13.8 times EBITDA, but it's a smaller company, and will double the number of casinos it owns in the next three years, so it's harder to compare against. 

Las Vegas Sands does have The Parisian under construction and should be completed near the end of 2015. It's also working on Eurovegas in Spain, which could initially be a $7.9 billion investment. These will drive growth but, in my opinion, they won't create enough growth to command a 20% premium over competitors, which also have new resorts in the works. If the stock falls 10% or so, I think it would be a great buy; but at the moment, it's fairly priced with growth baked in. 

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Dual Gaffes of the Week

On a fairly regular basis for more than a year now, we've been looking at CEO gaffes as they occur to hopefully gain valuable investing experience and avoid investing in companies where similar situations are possible in the future. Sometimes, though, a gaffe occurs that isn't necessarily the CEO's fault, but is still, nonetheless, a PR nightmare.

This week, as a slight break from our usual coal raking of CEOs, we'll take a look at two gaffes from the same sector that could turn into a huge PR nightmare for both companies.

The restaurant sector is extremely competitive to begin with, so any negative publicity can crush a company, regardless of its size or dominance, over the short term. This week has been something of a nightmare for fast-food restaurant chains McDonald's (NYSE: MCD  ) and Burger King Worldwide (NYSE: BKW  ) .

You must be at least "this employed" to participate in our budget
It all started earlier this week for McDonald's, which insulted the very core of its customer base by teaming up with Visa (NYSE: V  ) to create a budget planning website that it dubbed "Practical Money Skills for Life." The idea is actually a great one as citizens young and old of upper and lower incomes can always use the reminder and education about how to balance their income and spending. The execution, though, left a lot to be desired.

Here's the breakdown of McDonald's and Visa's sample monthly budget (link opens PDF file) as found on their collaborative website: 

Sample Monthly Budget

Monthly Net Income

Amount

Income (1st job)	$1,105
Income (2nd job)	$955
Other Income	$0
Monthly Net Income Total	$2,060
Monthly Expenses
Savings	$100
Mortgage/Rent	$600
Car Payment	$150
Car/Home Insurance	$100
Health Insurance	$20
Heating	$50
Cable/Phone	$100
Electric	$90
Other	$100
Monthly Expenses Total	$1,310
Monthly Spending Money	$750
Spending/Day	$25

Source: Practicalmoneyskills.com.

I'm not exactly sure what fantasyland McDonald's and Visa were living in when they created this budget, but it's downright insulting to a majority of the public.

First off, there's the assumption that a full-time McDonald's employee will have a second full-time job. I'm not sure McDonald's or Visa is aware of how difficult it is to (1) get a full-time job right now in the fast-food sector with the looming implementation of the Patient Protection and Affordable Care Act, and (2) work around your first full-time job with a second full-time job.

Second, in what alternate universe is health care $20/month? According to research by Bloomberg, in 2010 McDonald's employees paid an extremely reasonable $14/week. This is still incredibly cheap compared to the expected monthly average premium of more than $200/month once the PPACA is implemented, but nowhere near $20/month as this budget assumes.

Also, where's the monthly budget for food, groceries, gas for the car, child care, and life's other intangibles? Oh, yeah, it's right there in the "other" category... $100 a month! Even more comically, the first version of this budget (which has since been rejiggered by McDonald's and Visa) assumed a heating bill of $0! Apparently some of the best things in life are free... just not heating if you live in the real world!

What they're putting in kids meals these days
A gaffe like this for McDonald's, which threatens to hurt public opinion of the company and potentially even thwart some customer traffic, is just what struggling U.S. restaurant chains need to gain ground on the usually dominant fast-food chain. For Burger King, which has redesigned its menu to mimic many of the successful aspects of McDonald's own menu, it could have represented a perfect opportunity to hit McDonald's while they were down. Instead, it tripped up as well.

According to various news and police reports, on Tuesday a Burger King employee in Michigan included a very personal and illegal toy in a four-year old child's kids meal: a marijuana pipe. Apparently an employee hid the pipe in the kid's meal to avoid being caught. Instead, the grandparents of the four-year old discovered the drug paraphernalia when they got home and notified authorities. I understand that Burger King is all about "having it your way," but I'm pretty sure that breaking the law isn't on that menu of options.

A spokesperson for Burger King did their best mea culpa to rectify the situation, but the PR damage has already been done. 

The last fast-food chains standing
If Jack in the Box (NASDAQ: JACK  ) and Wendy's (NASDAQ: WEN  ) can manage to go a few weeks without sticking their foot in the their mouth, they both have a shot at picking up market share based on these PR gaffes from McDonald's and Burger King.

Jack in the Box has already done an exceptional job of remodeling its restaurants after McDonald's own establishments to make them more family friendly and has always been a differentiable fast-food restaurant because of its focus on serving breakfast all day long.

Wendy's, however, could really use the boost with its sales regularly lagging its peers. New summer menu items and an emphasis on its value menu could help, but it really needs to capitalize on any public opinion weakness in McDonald's and Burger King.

One thing's for certain: It's going to be difficult for McDonald's and Burger King to top this week's gaffes anytime in the near future, so they probably have nowhere to go but up from here!

It's practically a given that most companies will eventually trip up. The secret to successful investing is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.

Why Meritage Homes's Earnings May Not Be So Hot

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 Meritage Homes (NYSE: MTH  ) , 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, Meritage Homes burned $176.5 million cash while it booked net income of $122.0 million. That means it burned through all its revenue and more. 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 Meritage Homes 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.

Meritage Homes's issue isn't questionable cash flow boosts, but items in that suspect group that reduced cash flow. Within the questionable cash flow figure -- here a negative-- plotted in the TTM period above, other operating activities (which can include deferred income taxes, pension charges, and other one-off items) constituted the biggest reversal. Overall, the biggest drag on FCF also came from other operating activities (which can include deferred income taxes, pension charges, and other one-off items) which represented 40.8% 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 alternatives to Meritage Homes? It takes more than great companies to build a fortune for the future. Learn the basic financial habits of millionaires next door and get focused stock ideas in our free report, "3 Stocks That Will Help You Retire Rich." 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.

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Top 10 Clean Energy Companies To Buy Right Now

When it comes to the highly charged biodiesel industry, one company stands above the rest. Way above. Renewable Energy Group (NASDAQ: REGI  ) is not only the leader in terms of pure production capacity, but it also displays plenty of desirables that should be on every investor's radar. What makes the company so great? It is no secret. In particular, REG has focused on three areas to become the top biodiesel stock.

1. Focus on infrastructure
A lot of investors get giddy with excitement when talking about the distribution and logistics network of Clean Energy Fuels (NASDAQ: CLNE  ) . It may produce compressed natural gas for commercial truck fleets, but it has a lot in common with REG. Don't believe me? Take a look at Clean Energy Fuel's distribution network:

Top 10 Clean Energy Companies To Buy Right Now: Stamford Land Corporation Ltd (H07.SI)

Stamford Land Corporation Ltd, an investment holding company, owns and operates a portfolio of luxury hotels in Australia, Singapore, and New Zealand. It operates hotels and resorts under the Stamford Grand North Ryde, Sir Stamford Circular Quay, Stamford Plaza Sydney Airport, Stamford Grand Adelaide, Stamford Plaza Adelaide, Stamford Plaza Melbourne, Stamford Plaza Brisbane, and Stamford Plaza Auckland names. It also engages in the investment, construction, development, and trading of residential apartments, and retail and commercial buildings. In addition, the company is involved in providing travel agency services; importing, exporting, and dealing in wall coverings, interior decorations, and furnishing products; and offering management and consultancy services. Stamford Land Corporation Ltd is based in Singapore.

Top 10 Clean Energy Companies To Buy Right Now: Ria Resources Corp (RIA.V)

RIA Resources Corp., a junior oil and gas company, engages in the exploration, development, and production of oil, natural gas, and associated liquids principally in the Province of Alberta, western Canada. It holds a 98.963 % working interest in the Bonnie Glen Cardium Unit located in central Alberta. The company was formerly known as Blue Parrot Energy Inc. and changed its name to RIA Resources Corp. in May 2009. RIA Resources Corp. is based in Calgary, Canada.

5 Best Stocks To Buy For 2014: Pankl Racing Systems AG (PARS)

Pankl Racing Systems AG is an Austria-based holding company that develops, produces and distributes mechanical technology systems for the automotive and aviation industries, and specializes in the niche markets of motor racing, luxury vehicles and aerospace. The Company operates through two main segments: combined segment Racing/High Performance and Aerospace. The Racing segment supplies engine as well as drive train components and systems for the racing market. The High Performance segment is specialized in the production of engine and drive train components for luxury vehicles, engine parts for the aftermarket and aluminum forged parts. The Aerospace segment produces lightweight and flexible transmission components as well as systems for over 50 types of fixed and rotary wing aircraft. As of December 31, 2011, Pankl Racing Systems AG operated through 16 subsidiaries located in Austria, the United Kingdom, Slovakia and the United States. The Company is a subsidiary of the CROSS Group.

Top 10 Clean Energy Companies To Buy Right Now: Hunt Mining Corp(HMX.V)

Hunt Mining Corp., through its subsidiaries, engages in the exploration and development of precious metals in Argentina. It focuses on gold, silver, and base metal projects. The company holds rights in 3l mineral concessions covering approximately 286,792 hectares in Santa Cruz Province, Argentina. Its principal property includes the La Josefina gold and silver project covering approximately 528 square kilometer land package in the Deseado Massif mineral district, Argentina. The company was founded in 2006 and is based in Liberty Lake, Washington.

Top 10 Clean Energy Companies To Buy Right Now: MediciNova Inc.(MNOV)

MediciNova, Inc., a biopharmaceutical company, engages in the acquisition and development of small-molecule therapeutics for the treatment of serious diseases for the United States market. The company?s pipeline consists of six clinical-stage compounds for the treatment of acute exacerbations of asthma, chronic obstructive pulmonary disease exacerbations, multiple sclerosis and other neurologic conditions, asthma, interstitial cystitis, solid tumor cancers, generalized anxiety disorder, preterm labor, and urinary incontinence, as well as two preclinical-stage compounds for the treatment of thrombotic disorders. The company?s primary product candidates, include MN-221, which is Phase II clinical trials, and is intended for the treatment of acute exacerbations of asthma and chronic obstructive pulmonary disease exacerbations; MN-166 that is intended for the treatment of multiple sclerosis has completed Phase II clinical trials and monkey toxicity preclinical study; and AV4 11, which is intended for other central nervous system disorders has completed a Phase Ib/IIa opioid withdrawal clinical trial. MediciNova, Inc. was founded in 2000 and is headquartered in San Diego, California.

Top 10 Clean Energy Companies To Buy Right Now: Tyco International Ltd.(Switzerland)

Tyco International Ltd. provides security products and services, fire protection and detection products and services, valves and controls, and other industrial products worldwide. The company?s Tyco Security Solutions segment designs, sells, installs, services, and monitors electronic security, productivity, and lifestyle enhancement systems for residential, commercial, industrial, and governmental customers. This segment also designs, manufactures, and sells security products, including intrusion, security, access control, electronic article surveillance, and video management systems. Its Tyco Fire Protection segment designs, manufactures, sells, installs, and services fire detection and fire suppression systems, and building and life safety products for commercial, industrial, and governmental customers. The company?s Tyco Flow Control segment designs, manufactures, sells, and services valves, pipes, fittings, valve automation, and heat tracing products for general proce ss, energy, and mining markets, as well as the water and wastewater markets. Tyco International Ltd. was founded in 1960 and is based in Schaffhausen, Switzerland.

Top 10 Clean Energy Companies To Buy Right Now: international ferro metals npv(IFL.L)

International Ferro Metals Limited operates as an integrated ferrochrome producer. It mines and processes chromite, as well as produces and sells ferrochrome for use in stainless steel production. The company owns Lesedi chromite mines in Buffelsfontein, South Africa; and 80% interest in the Sky Chrome project, which is located adjacent to the Buffelsfontein plant. It has operations in Australia, China, Europe, South Africa, Taiwan, Japan, South Korea, and the United States. The company is headquartered in Sydney, Australia.

Top 10 Clean Energy Companies To Buy Right Now: Cogent Communications Group Inc.(CCOI)

Cogent Communications Group, Inc. provides high-speed Internet access, Internet Protocol, and communications services primarily to small and medium-sized businesses, communications service providers, and other bandwidth-intensive organizations in North America, Europe, and Japan. It offers on-net services to bandwidth-intensive users, such as universities, other Internet service providers, telephone companies, cable television companies, and commercial content providers; and multi-tenant office buildings, including law firms, financial services firms, advertising and marketing firms, and other professional services businesses. The company also provides its on-net services in carrier-neutral colocation facilities, Cogent controlled data centers, and single-tenant office buildings. In addition, it offers off-net services to businesses that are connected to its network primarily by means of last mile access service lines obtained from other carriers primarily in the form of p oint-to-point TDM, POS, SDH, and/or carrier ethernet circuits. Further, the company provides voice services; and Internet connectivity to customers that are not located in buildings directly connected to the company?s network. Additionally, it operates 43 data centers that allow customers to co-locate their equipment and access its network. Cogent Communications Group, Inc. was founded in 1999 and is headquartered in Washington, D.C.

Top 10 Clean Energy Companies To Buy Right Now: Rand Capital Corporation(RAND)

Rand Capital Corporation is a venture capital firm specializing in investments in early venture and in small to medium-sized privately held companies. The firm does not prefer to invest in real estate sector. It invests in companies that are engaged in the exploitation of new or unique products or services. It seeks to invest in companies based in the Western and Upstate New York region and its surrounding states with focus on Buffalo and Niagara region. The firm may invest in region within three to five hour drives from Western New York including Canada. It typically invests between $500,000 and $1.5 million and the total investment in rounds is between $1 million and $5 million. The firm seeks to be a lead investor in companies within its geographical area and participates in syndicate with other investors outside it. It prefers to invest in businesses that are unique or possess proprietary right. The firm prefers to be a minority investor and seeks to take a Board seat in its portfolio companies. It typically holds its investments for a period of five to seven years. Rand Capital Corporation was founded in 1969 and is based in Buffalo, New York.

Top 10 Clean Energy Companies To Buy Right Now: (LVMUY)

LVMH Mo� Hennessy - Louis Vuitton SA engages in the manufacture and sale of luxury products. Its wine and spirits product line comprises champagne, sparkling and still wines, cognac, and other spirits primarily under the Mo� & Chandon, Dom P�ignon, Mercier, Ruinart, Veuve Clicquot, Krug, Ch�eau d?Yquem, Ch�eau Cheval Blanc, Hennessy, Glenmorangie, Ardbeg, and Belvedere brand names. The company offers fashion and leather goods consisting of trunks, leather goods, ready-to-wear, shoes, watches, jewelry, accessories, sunglasses, and books principally under the Louis Vuitton, Fendi, Donna Karan, Marc Jacobs, Loewe, C�ine, Kenzo, Givenchy, Thomas Pink, Pucci, and Berluti brand names. Its perfumes and cosmetics product line includes fragrances, make-up, and skincare products under the Parfums Christian Dior, Guerlain, Parfums Givenchy, Kenzo Parfums, Fendi Parfums, Make Up For Ever, Parfums Loewe, Fresh, and Acqua di Parma brand names. The company also offers watche s and jewelry under the TAG Heuer, Hublot, Bulgari, Zenith, Montres Dior, De Beers, and Fred brand names. In addition, it operates retail stores under the brand names of DFS, Miami Cruiseline, Sephora, Samaritaine, and Le Bon March�for travelers. As of December 31, 2011, the company operated 3,040 stores worldwide. LVMH Mo� Hennessy - Louis Vuitton SA is based in Paris, France.

Pentagon Awards Only $120 Million in Contracts Monday

The U.S. Department of Defense started the week slow Monday, awarding only five new contracts to its defense contractors, and those five worth less than $120 million in aggregate. Of these, the two largest awards went to publicly traded companies, specifically:

BAE Systems' (NASDAQOTH: BAESY  ) San Diego Ship Repair subsidiary, which won a $38.6 million modification to a previously awarded contract to perform upgrades on the guided missile destroyer USS Benfold (DDG-65). BAE is expected to complete this work by August 2014. General Dynamics' (NYSE: GD  ) soon-to-be merged-out-of-existence Armament and Technical Products unit, which was awarded a $32.7 million firm fixed-price multi-year procurement contract for the production of MK82 Mod 0 Aegis gun and guided-missile directors and MK 200 Mod 0 Aegis director controllers to be incorporated into six Aegis Weapon System ship sets.

The Aegis Weapon System, described by its maker, Lockheed Martin (NYSE: LMT  ) , as "the world's premier naval air defense system," consists of an integrated SPY-1 multi-function phased array radar system, integrated into a missile battery, and can be used for shipboard defense against everything from aircraft to conventional missiles to ballistic missiles.

General Dynamics' role in this contract should be complete by August 2018.

Starbucks Can Only Help SodaStream Now

Starbucks (NASDAQ: SBUX  ) is starting to get busy with the fizzy, and that should be just fine for SodaStream (NASDAQ: SODA  ) investors.

The premium coffeehouse chain expanded its test of handcrafted soft drinks last week. As the country took in new menu additions and slight price increases, some stores in Austin and Atlanta began to offer up spiced root beer, lemon ale, and ginger ale carbonated sodas.

It's clear that the test that began in select Seattle stores in April is succeeding. The first wave of critiques has been generally positive, and baristas whipping up fresh soft drinks between latte orders are helping broaden the appeal of the chain to those thirsty for more than a coffee, dairy, or tea beverage.

Investors may naturally start to wonder if this will hurt SodaStream, but the more likely scenario is that it will help the fast-growing platform.

Think about it. Folks will be paying roughly $3 for a Starbucks soft drink fizzed up on the fly, nearly twice what they would be paying for a fountain beverage anywhere else in the strip mall. The value proposition will be that fresh sodas -- and customized flavors -- are worth more than what the cola giants can offer. The prestige of freshly carbonated beverages will make SodaStream creations more valuable, and you're naturally not just limited to the three premium flavors at Starbucks.

If that argument isn't enough to soothe SodaStream investors, let's turn to Jamba Juice parent Jamba (NASDAQ: JMBA  ) .

When Starbucks began offering smoothies a few years ago -- eventually followed by most of the fast-food and java-pouring doughnut chains -- the bearish Jamba thesis was that broader availability of blended fruit drinks and drive-thru convenience would kill the chain.

It didn't.

Jamba has been posting positive systemwide comps for the past two years, and the stock hit a multiyear high last week.

Starbucks didn't hurt Jamba. The baron of baristas actually educated the market on the merits of icy fruit beverages, and that's probably the same scenario that will play out this time as Starbucks makes self-carbonated-beverage-making more popular.

SodaStream stands only to gain ground in this move. It also wouldn't be a bad time to strike a deal with Starbucks to make the three flavors available for SodaStream machines at the retail level.

There's money to be made in buying the right retail concepts at the right time
The 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.

 

1 Great Dividend You Can Buy Right Now

Dividend stocks are everywhere, but many just downright stink. In some cases, the business model is in serious jeopardy, or the dividend itself isn't sustainable. In others, the dividend is so low, it's not even worth the paper your dividend check is printed on. A solid dividend strikes the right balance of growth, value, and sustainability.

Today, and one day each week for the rest of the year, we're going to look at one dividend-paying company that you can put in your portfolio for the long term without too much concern. This isn't to say that these stocks don't share the same macro risks that other companies have, but they are a step above your common grade of dividend stock. Check out last week's selection.

This week, we'll take a close look at Hasbro (NASDAQ: HAS  ) and I'll remind everyone that investing, while serious, can have its fun moments.

Do not pass go. Do not collect $200.
To put it mildly, there's been little clowning around in the toy and game sector of late. Perhaps the only thing we can count on more than disagreements in Congress is that children as a whole will see their interests change in a heartbeat multiple times over the next couple of years. What this means for toy companies is that they need to constantly be on the front end of the innovative scale and can't languish over failed ideas for too long -- because there will be many failed ideas.

JAKKS Pacific (NASDAQ: JAKK  ) shares, for instance, were massacred last week after it lowered its full-year sales guidance by more than 10%, revised its full-year forecast from a modest profit to a hefty loss, and suspended its quarterly dividend indefinitely. Without its Pokemon licensing, JAKKS is struggling to find new sources of revenue growth.

The story was very similar for Mattel (NASDAQ: MAT  ) whose core brands, which have survived decades of changing interest by children, are beginning to lose their luster. Specifically, Mattel reported the fourth straight sales decline for its iconic Barbie brand. Overall sales for the second-quarter trudged higher by less than 1% -- no thanks to a 2% drop in North American sales -- while profit actually fell by 24%.

But the sector struggles aren't confined to what you might refer to as stale gaming brands. LeapFrog Enterprises, a maker of educational tablets for children, has seen its share price move lower or head sideways for much of the past year as a combination of lofty shareholder expectations, and the potential for competition from the likes of Toys R Us or Google remains a constant threat. It also doesn't help that LeapFrog has historically been a very cyclical company. Until LeapFrog and the toy sector as a whole break those cyclical ties, they may struggle to excel throughout the year.

Source: Philip Taylor, Flickr.

Get out of jail free!
However, not all toy and game makers have such a bleak outlook in the short term. Hasbro, maker of Monopoly, Transformers, and other brand-name iconic toys, is using strategies that could help put it at the top of the toy pile among its peers.

To begin with, partnerships are a key component to Hasbro's ongoing success. In 2009, Hasbro entered into a deal with media company Discovery Communications (NASDAQ: DISCA  ) to create a channel known as the Hub, which would feature programming based on Hasbro's owned toy lines. Since 2010, when the channel made its debut, sales of My Little Pony have taken off. In the wake of its renewed success, the franchise released a new movie in June, which will go onto DVD later this summer. 

Content deals are also very important to Hasbro's success, with many of its core brands marketable on television or the big screen. That's why Hasbro signed a multiyear deal in 2012 with Netflix (NASDAQ: NFLX  ) to bring programming such as Transformers and G.I. Joe to family living rooms wherever Netflix operates. The deal is a win-win for both companies, as it greatly expands Hasbro's audience on the factor of convenience alone, while giving Netflix broader appeal to families with a bigger library of kids programming. 

Hasbro has also been changing the way it markets to children. Although its most recent quarterly results showed a double-digit decline in sales of boys' products, it was countered with a double-digit increase in sales to girls. Marketing to girls represents a large missed opportunity for Hasbro -- and not just in the traditional sense of dolls like Mattel, with its line of Barbies. Earlier this year, Hasbro launched a line of Nerf Rebelle foam products, including a bow, specifically targeted at girls. It should be able to re-engineer much of its product line to better target both sexes.

Show me the money, Hasbro
But, when I look at Hasbro, I see much more than a great investment -- I see dollar signs from its ongoing share buybacks and generous dividend!

In 2011, Hasbro added an additional $500 million to its share repurchase program. According to the company's press release at the time, since it announced its original share buyback in 2005, it had repurchased $2.3 billion worth of shares. Whereas this money doesn't go directly into shareholders' pockets, it does help to reduce total shares outstanding and make the company appear cheaper on a P/E basis.

The big moneymaking potential here lies with Hasbro's dividend growth. Although it had a dividend hiccup in 2001, Hasbro's dividend has grown by an average of 29.6% per year since 2003. In other words, Hasbro's dividend has jumped 1,233% per quarter in just a decade, as it's taken advantage of content deals and broadened its audience appeal.

Source: Nasdaq.com.
*Assumes quarterly payout of $0.40 for remainder of 2013 and 2014.

Based on its projected payout of $1.60 for the year in dividends, Hasbro is divvying out only 50% of next year's profits, a sustainable amount that could be subject to further double-digit dividend increases.

Foolish roundup
Sometimes the fun things in life do make for some of the best investment. Hasbro's ability to reignite the passion for its core brands among today's youth through content deals and broad-audience targeting is really beginning to pay benefits for shareholders. With the company growing its dividend by an average of nearly 30% per year over the past decade and currently yielding 3.4% -- far and away better than a CD at your local bank -- investors seeking dividend income need look no further than Hasbro for a great dividend idea.

The search for great dividends doesn't have to end here. If you're on the lookout for high-yielding stocks, The Motley Fool has compiled a special free report outlining our nine top dependable dividend-paying stocks. It's called "Secure Your Future With 9 Rock-Solid Dividend Stocks." You can access your copy today at no cost! Just click here.

Introducing the Sci-Fi Franchise That Beats "Star Wars" and "Star Trek"

Star Wars may be worth at least $4 billion to Walt Disney and Star Trek the subject of 12 mostly successful films and six television series for Viacom, but neither beats Doctor Who, the BBC adventure series about a wandering Time Lord that has thrilled audiences for five decades. The Guinness Book of World Records honored the show in 2009 as the most successful sci-fi series of all time.

Is that really fair? Taste is subjective, after all, and each series has seen more than its share of wins. For Fool contributor Tim Beyers, what makes Doctor Who so interesting is how prevalent "Whovians," as fans of the show are called, tend to be at pop culture events.

They came out in force at Denver Comic-Con, Tim says in the following video, overwhelming a conference room just for a chance to see Colin Baker and Daphne Ashbrook. In the 1980s, Baker succeeded Peter Davison as the sixth incarnation of The Doctor. Ashbrook appeared in a 1996 movie playing The Doctor's human traveling companion. That they both still attract so many fans speaks to the longevity of the franchise.

On a worldwide basis, more than 77 million in 48 countries watch The Doctor regularly, Reuters reports. Expect even more this November, when a 50th anniversary special airs. Neither the Starks and Lannisters of Game of Thrones nor the zombies of The Walking Dead have so large or fervent a fan base.

Why should this matter to you as an investor? Because passion can be a powerful profit driver. Look at AMC Networks (NASDAQ: AMCX  ) . Thanks to The Walking Dead, which debuted on the network in October 2010, revenue growth accelerated from 10.1% in 2011 to 13.9% last year, according to data supplied by S&P Capital IQ.

For Doctor Who, the difficulty for American investors is that there is no way to invest in the BBC directly. Yet there are alternatives: Amazon.com and Apple (NASDAQ: AAPL  ) , principally.

Both companies sell single episodes and full seasons of The Doctor's adventures. Amazon, like Netflix, also streams prior seasons, while Apple says iTunes executes some 800,000 TV downloads daily. Parts 1 and 2 of the latest season rank in the top 10 of iTunes downloads in Science Fiction and Fantasy.

Investing in Apple means getting a cut of the profits from those downloads. Amazon offers a similar opportunity. Will you take it? Please watch the video for Tim's full take, and then leave a comment to let us know which shows you're downloading, and from which service.

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7 (Civilian) Planes That Made Boeing Great

Beware: I suspect this article will please precisely no one. Consider yourself forewarned.

After two weeks that have seen two Boeing (NYSE: BA  ) planes left burning on the tarmac, I've been asked to remind investors of the bigger picture at Boeing -- to pen a piece on the seven planes that made Boeing great.

Of course, boiling down the history of a century-old plane builder to just seven important models must be an exercise in triage. Do we limit our choices to Boeing qua Boeing, or do McDonnell-Douglas (or even just Douglas) birds deserve to roost among these rankings? (Sure. Why not?) Do we count military warplanes, in addition to civilian airliners? (No. At least not in today's column.) And how far back in time shall we search for the roots of Boeing's greatness, and how far into the future dare we guess its success may reach?

The only certainty is this: Anyone who knows Boeing at all is going to disagree with at least some of these choices. So be it. Without further ado, here are my nominations for the seven planes that made Boeing a great company -- and that give us some assurance this company has the staying power to remain great despite its recent setbacks.

Boeing 80

Boeing 80, Source: Boeing.

First flown in 1928, the Model 80 was the plane that got Boeing off the ground. It was the company's first airplane built specifically for passenger transport, carrying first a dozen passengers, then later upgraded to the Model 80A-1, which could carry 18. It was the plane Boeing built to compete with rival passenger aircraft from Fokker and (if you can believe it) Ford (NYSE: F  ) , and it eventually became the first plane with a stewardess on board to hand out refreshments (a registered nurse, Ellen Church, landed the first stewardess berth in 1930).

In its reconfigured 80A-1 iteration, the Model 80 sported an 80-foot wingspan and could fly as far as 460 miles.

Boeing 314 Clipper

Boeing 314, Source: Boeing.

Perception is a powerful thing. When selling an airplane to an airline, there can hardly be a more potent marketing tool than a line like this: "And did you know this is the plane the president picked to fly on?"

Well, in 1943, in the middle of World War II, President Franklin D. Roosevelt flew to Casablanca aboard the Dixie Clipper, a Boeing 314 -- making the 314 the effectively the very first "Air Force One." (They didn't call it that, of course. Not least because at the time, the U.S. didn't actually have an Air Force.)

The Boeing 314 enjoyed some commercial success as well. It was first flown in 1938, and 12 of the planes were built before WWII broke out. Designed to spec for Pan American World Airways as a "flying boat" capable of carrying passengers to Europe, the 314 could carry 74 passengers in style and boasted a flight range of 3,500 miles. With a wingspan of 152 feet, the deep-chested 314 was more than twice as big as the Model 80.

Douglas DC-3

Douglas DC-3, Source: Boeing.

Sometimes, great mergers create greater companies. If you've ever wondered why McDonnell Aircraft bought Douglas Aircraft in 1967, or why Boeing merged with McDonnell Douglas 30 years later, the answer can be summed up in one hyphenated word: DC-3.

It wasn't as big as the Boeing 314, with a smaller wingspan and a shorter range. Yet Boeing modestly calls the DC-3, first flown in 1935, "the greatest airplane of its time," and perhaps "the greatest of all time." Many people agree. Originally built for American Airlines (now US Airways (NYSE: LCC  ) ), the plane soon gained a fan in United Airlines (now United Continental (NYSE: UAL  ) ) -- and then it went on to win sales contracts at nearly three dozen airlines and to (in alliance with its DC-2 predecessor) capture more than 90% of the air-passenger market. The DC-3 carried 28 passengers, or slept 14, which doesn't sound like a lot in today's terms. But it was the first plane capable of carrying enough passengers, and carrying them fuel-efficiently enough, to earn its airline owners a profit.

One testament to the plane's quality? Hundreds of DC-3s are still flying today, nearly four score years after the plane was first built.

Boeing 707

Boeing 707, Source: Boeing.

Built around the bones of the KC-135 military aerial refueling tanker in 1957, the Boeing 707 got off to a troubled start. Not all that unlike with the 787 today, Boeing made a lot of big bets on the 707, and these bets came to define the company -- and the industry, in time.

For example, the 707 standardized Boeing and industry practice of putting the passenger door on the left side of the plane, and installing doors both fore and aft. Boeing also gambled big on customizing the base model plane (130-foot wingspan, 3,000-mile range) to the requirements of multiple customers. It built longer-range models for far-off Australia's Qantas Airways, and it tweaked the plane to accept bigger engines for high-altitude flights among South American airlines. That was quite a change from the old practice of drawing up entirely new airplanes at the request of individual customers such as American and United.

Such tweaks cost some money, sure. But they also helped Boeing grab market share from rival Douglas Aircraft. Ultimately, Boeing sold 856 of the planes.

Boeing 737

Boeing 737, Source: Boeing.

Forty-six years young and still going strong, our next entree on the Boeing's best planes-list is a no-brainer: the Boeing 737. 93.7 feet long, and with a 93-foot wingspan, the original 737 was nicknamed "the square" for its nearly equal measurements. It flew 1,150 miles on a full tank of gas and carried as many as 107 passengers. Later versions, running up through today's 737 Next Generation and 737 MAX iterations, can carry as many as twice that number.

Currently en route to delivering well over 10,000 planes, with more than 7,000 already in the hands of its customers, the 737 is the most successful commercial airplane ever built. Now in its fifth decade of production, the 737 remains so popular that Boeing quite literally cannot build the planes fast enough to keep up with demand.

Boeing 747

Boeing 747, Source: Boeing.

Boeing designed and built the world's first jumbo jet in just 16 months, and then got it airborne in 1969. Perhaps Boeing's most iconic airplane, the first Boeing 747 stood six stories tall and weighed nearly 370 tons. It was so big that Boeing had to construct an entirely new factory to build it. The existing workplaces just didn't fit.

For nearly 40 years, it was the world's biggest passenger jet, carrying as many as 550 passengers on flights as long as 6,000 miles. Needless to say, it's still flying today. In fact, just last week Boeing sold two more of them. (Freighter versions).

Boeing 777

Boeing 777, Source: Boeing.

Last but not least -- and really, not even last -- we'll end this list with the plane that inspired it: the Boeing 777, which crash-landed and caught fire at San Francisco International Airport last weekend -- yet was so well built that it managed to keep all but two passengers alive through the crash, out of hundreds aboard.

How great is the 777, and how helpful is its reputation to Boeing? It's great enough that last week's crash was only the second significant accident recorded in the Triple-7's 18-year history. Great enough that, according to famed Capt. Chesley "Sully" Sullenberger, last weekend was the only recorded instance in which a passenger aboard a 777 died. And it's great enough to have persuaded Boeing's customers to line up and buy 1,100 777s over the years. 

The biggest twin-engine commercial jet in the world, the 777 was Boeing's first plane to be designed entirely on computer using 3-D graphics. It sports wings spanning nearly 200 feet, a range upwards of 8,000 miles, and capacity to haul up to 440 passengers more than one-third of the way around the earth before needing to refuel.

Foolish takeaway
Boeing's planes have, and Boeing's stock has, stood the test of time -- 97 years, to be precise. Does all this prove conclusively that Boeing stock should be bought today, at a 19 P/E ratio? Maybe, maybe not. But before you count Boeing out over a couple of mishaps, remember -- its biggest rival today, Airbus parent EADS (NASDAQOTH: EADSY  ) , costs more than 25 times earnings. And EADS has only been around since 2000.

Seems to me that investors who are valuing Boeing at a discount to its less-proven rival are doing Boeing a disservice.

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Why Community Health Systems Shares Are Feeling Sick

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

What: Shareholders of Community Health Systems (NYSE: CYH  ) , a hospital operator in the U.S., are feeling sick to their stomachs this afternoon, with their stock dropping as much as 13% after announcing its preliminary second-quarter results.

So what: For the quarter, Community Health Systems noted that admissions dropped by 5.1%, which led to expected revenue of $3.24 billion. The Street, by comparison, had been looking for revenue of $3.37 billion. The company specifically lists bad debt accounts, presumably from treating an increase in uninsured people, and declining reimbursements, as the primary reasons for the shortfall. It also projected EBIDTA of $414 million, which would be down 14% from the year-ago period.

Now what: Community Health Systems' results are actually a bit confusing because they come just days after HCA Holdings, the nation's largest hospital operator, significantly guided its EPS higher for the upcoming quarter. This could merely represent some short-term poor luck on Community Health's part, or it may signal a struggling transition in the wake of impending health-care reform under the Patient Protection and Affordable Care Act. I'd prefer to wait for Community Health Systems' quarterly report to get the full story, but for now, I'd recommend adding it to your Watchlist.

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A Basket of Promising Small-Caps

Exchange-traded funds offer a convenient way to invest in sectors or niches that interest you. If you'd like to add some small-cap stocks to your portfolio, but don't have the time or expertise to handpick a few, the Guggenheim Russell 2000 Equal Weight ETF (NYSEMKT: EWRS  ) could save you a lot of trouble. Instead of trying to figure out which companies will perform best, you can use this ETF to invest in lots of them simultaneously.

The basics
ETFs often sport lower expense ratios than their mutual fund cousins. The Guggenheim ETF's expense ratio -- its annual fee -- is a relatively low 0.41%. The fund is very small, too, so if you're thinking of buying, beware of possibly large spreads between its bid and ask prices. Consider using a limit order if you want to buy in.

This ETF is too young to have a sufficient track record to assess, but for the curious, it underperformed the S&P 500 in 2012, and is ahead of it so far this year. As with most investments, of course, we can't expect outstanding performances in every quarter or year. Investors with conviction need to wait for their holdings to deliver.

Why small caps?
It's smart to include smaller companies in your portfolio, as the best of them can grow rapidly, and eventually become large caps.

More than a handful of small-cap companies had strong performances over the past year. SUPERVALU (NYSE: SVU  ) surged 200%. The company has suspended its dividend, in order to cut costs and more effectively compete in its low-margin industry, where it also faces growing competition from Wal-Mart and other discounters. Some rivals such as Whole Foods Market have been able to maintain higher margins by offering organic produce and higher-end products. SUPERVALU has been reshaping itself and selling off some brands, and apparently many investors are hopeful.

Boulder Brands (NASDAQ: BDBD  ) gained 38%, and though you may think you don't know the company, it used to be Smart Balance until recently, and sports healthy-leaning brands, such as Smart Balance, Udi's, Glutino, Earth Balance, and Best Life. (The company is based in New Jersey, not Colorado, too.) Boulder recently bought 80% of GlucoBrands, owner of Level Life Foods, which specializes in blood-sugar-managing products such as bars and shakes. Boulder Brands is free-cash-flow positive and enjoying double-digit revenue growth.

Diamond Foods (NASDAQ: DMND  ) advanced 17%, posting a surprising gain instead of an expected loss in its last quarter. Some have worried about a drop in nut sales, and view the company as a possible acquisition target, while others think the company might want to do some shopping of its own. Diamond is also recovering from accounting-related troubles, and a new possible worry is the FDA looking into why salmonella has been turning up in nuts recently.

Other companies didn't do as well last year, but could see their fortunes change in the coming years. Dietary supplement maker Star Scientific (NASDAQ: STSI  ) sank 60%, with some investors worried about persistent net losses and even scandals. In its last quarter, the company blamed its growing losses on increased sales efforts, and also noted significant legal costs related to investigations and class-action lawsuits. Bulls noted solid sales growth for its inflammation-treating supplement, Anatabloc.

The big picture
A well-chosen ETF can grant you instant diversification across any industry or group of companies -- and make investing in and profiting from it that much easier.

This is not the only ETF worth considering. I invite you to check out The Motley Fool's special free report, "3 ETFs Set to Soar," to learn more about a few ETFs that have great profit-delivering potential for shareholders. Just click here to access it now.

Why Bank of America Is Booming Today

Three and a half hours into the trading day, Bank of America (NYSE: BAC  ) shares are up 3.1% on strong second-quarter earnings and some reassuring words from the Federal Reserve.

Wall Street and Washington weigh in
B of A is reporting that net income rose 63% year over year, from $2.5 billion to $4.0 billion, while total revenue increased 3.2% year over year, from $22.0 billion to $22.7 billion. Earnings per share are $0.32, beating analyst expectations of $0.25.

Over on Capitol Hill, Fed chairman Ben Bernanke is testifying to the House Committee on Financial Services on U.S. monetary policy. His comments indicate that the central bank will still begin tapering QE later this year, so long as the American economy continues trending in the right direction, but that the Fed believes the economy is still clearly not where it should be.

Foolish bottom line
The markets have waited with baited breath on the words of Federal Reserve chairmen for years now, and have responded either calmly and coolly, or flown completely off the handle. Today, investors have taken the former road, the one not often enough taken, and have responded to Bernanke's comments with the equanimity they deserve.

He didn't say anything today he hasn't said since the Fed's last policy setting meeting in June. But I think the message is finally getting through to the markets that just because there's a plan in place to dial back quantitative easing doesn't mean it's happening tomorrow. Nor does it necessarily mean it's going to happen at all; tapering remains dependent on whether the economy continues to improve.

That said, the real energy behind B of A's strong performance today is its strong second-quarter earnings. In addition to what was mentioned above, the bank also saw more business from equities sales and trading.

Unfortunately, some of the bank's immense increase in profit was the result of cutting costs, but we all know you can only cut so much fat before you start cutting into muscle. A 63% increase in profit on 3.2% of revenue growth is very likely unsustainable. That said, it's good to see some revenue growth. In the first quarter, revenue growth was generally pitiful for the big banks.

But as always, remember that investing Foolishly means investing for the long term: tuning out market noise and tuning into the fundamentals of the companies you're invested in. Check in on your stocks once a month, or even once a quarter, and leave the daily ticker checks to the day traders: Your broker may not thank you, but your portfolio definitely will. 

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