Drinks Americas Holdings is Off and Running (DKAM)

Say whatever you want about Drinks Americas Holdings, Ltd. (OTCMKTS:DKAM), but one thing is undeniable... this company is producing a lot of revenue despite being a very small company. More specifically, the DKAM market cap is abnormally low relative to the sales figures the company is putting up.

No, there aren't any profits - at least not yet. That's nothing unusual for a small cap company at this stage of its life. The thing investors key in on at this level is proof of life, and Drinks Americas Holdings has plenty of that. And, perhaps more important to would-be shareholders right now is the fact that DKAM shares are starting to move higher, in a trade-worthy way.

For those not familiar with it, DKAM is, as the name would suggest, a beverage company. Specifically, Drinks Americas Holdings, Ltd. is a producer as well as a distributor of a few niche/specialty wine and spirits brands. It's nowhere close to being what some would consider a "major player", but all things are relative. Though the company is only a $680,000 organization (on a market cap basis), Drinks Americas also generated $6.3 million worth of sales for the past twelve months. Granted, it also lost $11.7 million in the process, but the net income or net less at this point is largely secondary. The hard part is growing sales, but that hasn't been particularly difficult for DKAM. In fact, sales have been strong enough for long enough to prompt what's made this stock such a compelling idea now.

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In simplest terms, DKAM shares are starting to move, clearing technical hurdles in the process, and establishing even more well-supported momentum. The chart below tells the tale. Drinks Americas Holdings, Ltd. shares have walked their way above all their key moving average lines over the past three months, and they've done so on rising volume. In fact, the volume we've seen since November is the most we've seen from the stock since, well, ever. With that much participation in a very sustainable, well-paced rally, odds are very good this uptrend is going to keep chugging along. And well it should. There's more going for this company now than there's ever been before.

As is the case with any micro cap, Drinks Americas Holdings isn't a completely risk-free trade. Much of the recent bullishness has stemmed from the company's aggressive press release campaign. Should those efforts stop, so too might the buying effort. But, at least the company has something to tout, and given that the PR effort is working - and helping DKAM move upward - odds are pretty good that the company will stick with the effort, spurring more upside for the stock.

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Susquehanna Upgrades Broadcom; Raises PT (BRCM)

Susquehanna reported on Tuesday that it has raised its rating on Broadcom Corporation (BRCM).

The firm has upgraded BRCM from “Neutral” to “Positive,” and has lifted the company’s price target from $33 to $35. This price target suggests a 23% upside from the stock’s current price of $26.91.

Analyst Chris Caso commented: “Our downgrade of BRCM in May was predicated on already high Street expectations on handsets and no notable improvement in networking to drive upside. We think expectations and the stock price have now been sufficiently reset ahead of what we expect to be catalysts in 2014 – including the iPhone 6 product cycle, potential improvement in networking and the impact from the recent Renesas acquisition. In addition, after several years of overspending on their handset initiatives, we think we are now closer to the point where the company either captures a return on that investment or is forced to moderate spending – either of which benefit profitability. We see the upcoming December analyst meeting as a potential intermediate catalyst.”

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Broadcom shares were up 38 cents, or 1.41%, during pre-market trading Tuesday. The stock is down 19% YTD.

7 Sin Stocks to Buy Now

In a world where even the Pope calls himself a sinner, there are profits to be made by peddling temptation. Traditional "sin stocks" – those involving guns, alcohol, tobacco and gambling – have been on a roll over the past year. And vice stocks continue to hold long-term appeal.

See Also: This Fund Beats the Market with Faith-Based Rules

Of course, sensitive investors might balk at investing in companies that make or market products they find abhorrent. But sin is a relative term. A teetotaler might eschew stocks of liquor companies, for example, while another investor could argue that soft drinks are just as bad for your health. "There is a lot of gray area," says Patrick Morris, chief executive of Hagin Investment Management, a New York City money manager.

Further complicating the case for purveyors of sin is their susceptibility to government restrictions and negative news developments that don't affect the typical company. The shares of gun makers may plunge in the wake of a mass shooting (or they may surge; see below), while legislation to levy new excise taxes on companies that facilitate "sinful" behavior could tank tobacco, booze and casino stocks. That means investors in these companies have to be prepared for volatility. But volatility can also mean opportunity for intrepid investors willing to buy sin stocks.

Alcohol

The future is bright for booze, says Stifel Nicholas analyst Mark Swartzberg. Not only is the U.S. finally expanding enough to make Americans want to raise a celebratory glass, but foreign economies, especially those of developing markets, are also taking flight, creating bigger middle classes all over the world. And people who reach middle-class status are more likely to imbibe and move up to premium brands.

Swartzberg likes two overseas-based alcohol companies in particular. He has buy ratings on Diageo (DEO), maker of Johnnie Walker Scotch, Smirnoff vodka and Tanqueray gin, and on Anheuser Busch InBev (BUD), maker of Budweiser, Stella Artois and Beck's. Both trade in the U.S. as American depositary receipts. (Share prices are as of January 22.)

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Swartzberg says London-based Diageo is benefiting as U.S. consumers move from beer to high-end spirits, which command rich profit margins. He thinks the trend will gain steam as economic growth in the U.S. accelerates.

InBev has been on a buying spree lately, agreeing to buy South Korea's Oriental Brewery in January for $5.8 billion after buying beer giant Grupo Modelo, maker of the Corona and Pacifico brands, last year. However, to win Justice Department approval of the earlier deal, InBev had to sell off Modelo's U.S. business. That acquisition and divestiture has muddled earnings comparisons and is likely to present some transitional challenges. But Swartzberg is impressed with InBev's management, culture and new advertising initiatives aimed at better connecting with the hard-drinking Millennial generation. Despite some short-term tumult, he expects InBev to reward shareholders generously over the next year.

D.A. Davidson & Co. analyst Timothy Ramey is a fan of Constellation Brands (STZ), which makes Robert Mondavi and Clos du Bois wines, as well asBlack Velvet Canadian Whisky and Paul Masson Grande Amber Brandy. Constellation was the buyer of Modelo's U.S. business, which turned the wine and spirits company based in Victor, N.Y., into the U.S.'s third-largest beer brewer (after InBev's Anheuser-Busch unit and SAB Miller). That has sent sales and earnings soaring and is likely to help Constellation grow profits at a double-digit pace for several years.

Gambling

Whether you consider gambling a vice or a diverting form of entertainment, it's spreading throughout the nation, with gaming establishments opening up even in Bible Belt states such as Louisiana and Missouri. In fact, gambling is becoming so common in the U.S. that new casinos have started to cannibalize the customers of old ones, making it tougher for some companies to grow.

That's not the case in the Chinese gaming capital of Macau, where just six companies control all the gambling licenses in China. The most attractive stock among these is Melco Crown Entertainment (MPEL), says Bryan Maher, an analyst with Craig-Hallum Capital, a Minneapolis investment banking firm. The Hong Kong company's profits and revenues are growing briskly; analysts on average see earnings surging 30% this year. The reason? Melco gets all of its profits from Macau, and a fairly new train line from mainland China to the Hong Kong-adjacent peninsula is contributing to booming growth. Macau already brags seven times the gaming revenue of Las Vegas.

Moreover, Melco is developing a resort on the nearby island of Cotai that could help address Macau's hotel room shortage. That might encourage visitors to stay longer and gamble more. Melco is also developing a property in the Philippines. Maher expects these two international gambling centers to fuel Melco's rapid growth for years to come, and that could justify Melco's rich stock price. Its ADRs trade at 26 times estimated 2014 earnings.

Guns

Gun sales are likely to drop this year for a counterintuitive reason: Congress isn't seriously considering any gun-control measures. After a young man massacred 20 children and six adults in Sandy Hook, Conn., in 2012, a raft of gun-control bills were introduced in an effort to halt the sale of semiautomatic firearms. That sent gun enthusiasts on a "now or never" buying spree that caused gun makers' profits to soar. But the bills went nowhere.

Still, Brian Ruttenbur, an analyst with CRT Capital Markets, a Stamford, Conn., investment firm, likes Smith & Wesson (SWHC). The stock is cheap, selling for just 11 times estimated year-ahead earnings. Earnings are growing slowly, but Ruttenbur thinks a rise in the number of states allowing concealed weapons and a hike in gun use among women will eventually revive sales and profits.

Tobacco

The industry faces plenty of challenges in the U.S., where smoking has been on the decline for decades. The latest government data shows that just 18% of Americans smoke today, compared with nearly 25% in 1995. However, the figures are vastly different overseas, where rising populations in developing countries have led to a 34% increase in the number of daily smokers worldwide since 1980, , according to the Journal of the American Medical Association. In countries such as Russia and Indonesia, more than half of the male population smokes every day. And these smokers are moving up to premium brands, says Morningstar analyst Thomas Mullarkey.

That's been a boon for Philip Morris International (PM), which sells the iconic Marlboro and Chesterfield brands in overseas markets. (Altria sells these brands in the U.S.) Better yet, the New York City company's stock is cheap, says Mullarkey. It sells for 15 times estimated 2014 earnings and boasts an impressive dividend yield of 4.5%. Mullarkey thinks the stock is worth $93 today.

He also likes British American Tobacco (BTI), maker of Lucky Strike, Kent, Dunhill and Pall Mall brands. The company operates in Asia, Eastern and Western Europe, Africa and the Middle East, as well as in the U.S. The ADRs sell for 15 times estimated 2014 earnings and yield 4.0%.

Experts: Target Hackers Will Be Tough to Find

Joe Raedle/Getty Images NEW YORK -- It doesn't surprise experts that some debit and credit card numbers stolen from Target's computer systems may have surfaced among nearly 100 fake credit cards seized by police in Texas this week. Even so, they say the bust is unlikely to lead authorities directly to the hackers behind the breach, given the vast, labyrinthine nature of the global market for stolen data. According to police in McAllen, Texas, two Mexican citizens arrested at the border used account information stolen during the pre- Christmas Target breach to buy tens of thousands of dollars' worth of merchandise. But the U.S. Secret Service said Tuesday its investigation into the possibility of a link between the Target data theft and the arrests remains ongoing. Target (TGT) says hackers stole about 40 million debit and credit card numbers from cards swiped at its stores between Nov. 27 and Dec. 15. The thieves also took personal information -- including email addresses, phone numbers, names and home addresses -- for another 70 million people. In the aftermath of the breach, millions of Americans have been left to wonder what's become of their precious personal information. Chester Wisniewski, senior security adviser for the computer security firm Sophos, says in cases where such a massive amount of information is stolen, criminals generally divide the data into chunks and sell the parcels in online black markets. In many ways, those markets behave much like any legitimate marketplace ruled by the forces of supply and demand. Groups of higher-end cards are worth significantly more than those with lower credit limits and so are cards tied to additional personal information, such as names, addresses and zip codes, which make them easier to use. After thieves purchase the numbers, they can encode the data onto new, blank cards with an inexpensive, easy-to-use gadget. Or they can skip the card-writing process and simply use the card numbers online. Crooks often have the option to buy cards last used in their area. That way, Wisniewski says, the cards attract less attention from the banks that issued them. According to police, the pair arrested at the U.S.-Mexican border used cards containing the account information of Target shoppers from South Texas. Police say the two used fraudulent cards to purchase numerous items at national retailers in the area. The underground markets always have a steady supply of card numbers on sale and their locations are always moving as they try to elude law enforcement, says Daniel Ingevaldson, chief technology officer at Easy Solutions Inc., a firm that sells anti-fraud products and tracks the activity of the online black markets. A big jump in inventory usually indicates there's been a breach of a major retailer. That's what Ingevaldson's firm saw in the cases of both Target and Neiman Marcus, which also recently reported a breach. While many of these online bazaars and forums are based in Russia and Eastern Europe, much of the chatter is in English and appears to have been written by Americans, Ingevaldson says. The types of criminals who buy the card numbers run the gamut, ranging from purely online white-collar crooks to street gangs. "In reality, card numbers can be bought by anybody with access to the forums and a few Bitcoins in their pocket," Ingevaldson says. Wisniewski says the people who buy card numbers online and produce the fake cards aren't the ones who try to use them. Using the cards is the riskiest part of the fraud scheme, so the task is usually farmed out to others who are often recruited through spam emails. The recruiters then send them fraudulent debit and credit cards and instruct them to buy large quantities of expensive merchandise or gift cards in exchange for a small percentage of their value. Card users, once caught, often only have a handler's email address to share with police, making it nearly impossible to find the recruiters, Wisniewski says. Both analysts say Russia and former Soviet countries are a hotbed for hackers behind these kinds of schemes. The region has a large population of highly educated computer science professionals and law enforcement is extremely lax when it comes to fraud that occurs overseas and not in the hackers' home country. Wisniewski and Ingevaldson also believe the original authors of the malicious software used in the Target breach are likely based in Russia or Eastern Europe, as some reports on the breach have suggested. But it's unlikely the original programmers do any hacking themselves. They can make a nice living simply selling the code to those who do. "Keep in mind, it isn't illegal to write these kind of codes, just to use them," Wisniewski says. "And selling them is a lot less risky than taking cards into an Apple store."

Osisko Plays Hard to Get With Goldcorp, Both Rise

Osisko Mining’s (OSKFF)  board formally rejected Goldcorp’s (GG) bid for the company the company yesterday.

Reuters

Bloomberg has the details:

Osisko Mining Corp.  rejected Goldcorp Inc.'s C$2.6 billion ($2.4 billion) unsolicited bid because it's too low and said the Canadian company is reviewing other options.

The "meager" premium offered by Goldcorp's shares-and-cash offer is significantly below comparable transactions, Montreal-based Osisko said today in a statement. It said the offer undervalues its Canadian Malartic mine in Quebec, which started producing in 2011.

"The Goldcorp offer has been opportunistically timed to occur before Canadian Malartic enters what Osisko expects will be its most productive years," Osisko said. "The true strategic value of the company's assets will be demonstrated as the review of value-maximizing alternatives progresses."

Cowen’s Adam Graf and Misha Levental think Goldcorp’s bid for Osisko is fair. They write:

We believe that at current metals prices, the $2.6Bn price-tag for OSK’s assets – primarily the producing Canadian Malartic Mine in Quebec – appears to be at a significant premium to NAV. While Canadian Malartic provides advantages to near-term FCF, we believe there are more value-accretive assets for sale in Canada and North America.

Credit Suisse’s Anita Soni and Robert Reynolds think Goldcorp’s bid underestimates the improvements happening at Osisko. They write:

OSK shareholders have many factors to consider including (i) an independent rerating of OSK shares to the range of 1.1-1.2x NAV, from the current 1x…; (ii) reduced leverage within a large company (as well as the benefits of asset diversification); and (iii) premium valuation of GG shares. On our current Goldcorp target multiples, the current transaction would provide a C$6.19/sh value to OSK shareholders (20% below our current C$7.75/sh target price

Shares of Goldcorp have gained 2% to $23.64 today, while Osisko Mining has advanced 1.4% to $5.96 on a day that SPDR Gold (GLD) drop 1% to $119.77 and the Market Vector Gold Miners ETF (GDX) advanced 1.5% to $23.68.

Human Inequality Is Despicable, but Stock Discrimination on Wall Street Is a Good Thing

Today here in the U.S. we celebrated Martin Luther King Jr. Day, and most Americans had the day off to commemorate Dr. King's impact on American history and human civil rights. Dr. King dreamed of a world in which all people were treated equally regardless of race, creed, color, or religion, and his life was tragically cut short before that dream could be fulfilled. We still struggle today with these same issues, and we should continue to strive for a world where human discrimination doesn't exist.

Most of us have a negative association with the word "discrimination," and when it comes to the treatment of human beings, that association is appropriate. But when it comes to our investments, a slightly different perspective may be in order.

On the stock market, we can find a number of instances in which stocks are discriminated against, both justly and unjustly. Sometimes a stock has been beaten down based on industry trends, or a because a competitor reported comparatively good or bad earnings figures. Irrational moves like this amount to discrimination against a stock that may never have done anything wrong, but smart investors can take advantage and pick up an unjustly mispriced stock at a bargain.

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Likewise, inequality can take on a different meaning in terms of investing. Look at Amazon.com (NASDAQ: AMZN  ) or Tesla Motors (NASDAQ: TSLA  ) to see what I mean. Amazon never records a large profit, and that's because Jeff Bezos has made it clear from the start that most profits will be rolled back into the business. But because Amazon isn't treated like other companies in the retail world, the stock price, on a price-to-earnings basis, looks insane. It currently trades at a mind-boggling P/E ratio of 1,447,

Similarly with Tesla, if we base what the company's market capitalization should be on the number of vehicles it sells, then the stock is insanely overpriced. In 2013, Tesla sold just over 22,000 vehicles, yet the company is currently valued at over $20 billion. For comparison, Ford (NYSE: F  ) is believed to have sold more than 2.5 million vehicles in 2013 -- 10 times as much as Tesla -- yet its market cap is only a little more than three times as large, at $65 billion. This is a type of discrimination against Ford, in that investors believe Tesla will grow at a faster rate than the older car company. So you can make an argument that the stocks are being treated unequally, yet they're also being evaluated on their own merit, which is a good thing.

But there's one place where discrimination in investing is just as negative as in other parts of life, and that's on the Dow Jones Industrial Average (DJINDICES: ^DJI  ) . Because it's a price-weighted index, it doesn't give an accurate picture of what the markets really look like. Its highest-priced stock, Visa, currently trades at $232.18 and makes up 9.06% of the Dow, while its lowest-priced stock, Cisco Systems, trades at $22.74 and accounts for only 0.89% of the index's weight. Yet the two companies' market caps aren't that far apart -- $147 billion for Visa, and $121 billion for Cisco.

The Dow's methodology thus fails to evaluate stocks based on their own merit (i.e., market cap) and instead judges them by their superficial outward appearance (the share price, which is the first thing investors usually see but doesn't always tell you much about the company).

So while inequality and discrimination can sometimes be a good thing for investors, that's certainly not always the case -- and it's something we should never tolerate on a human basis. So let's take some time today to thank Dr. King and everyone else who's fought and sacrificed so much toward achieving that goal.

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Hot Bank Companies To Invest In 2014

Wells Fargo (WFC) said its net income rose 13% year over year in the third quarter, despite a 42% drop in its mortgage banking income.

But while the third-quarter decline in mortgage originations is a “significant negative," it’s not lethal, according to Richard Bove, vice president of equity research at Rafferty Capital.

"From an operating standpoint, the company is doing actually pretty well," Bove said on CNBC. "And therefore I don't think one has to worry about the fact that refinancing mortgages caused some difficulty in this quarter."

Wells Fargo reported net income of $5.6 billion, or $0.99 a share, vs. $4.9 billion, or $0.88 a share, last year. Analysts had estimated Wells Fargo would earn $0.97 per share. Revenue was $20.5 billion, compared with $21.4 billion in the second quarter of 2013.

Wells Fargo made $80 billion in home loans, down from $139 billion last year, and mortgage banking income fell 43% to $1.61 billion.

Scott Siefers, a bank analyst at Sandler O'Neil & Partners says the good news is that Wells Fargo beat estimates, the credit environment is improving and its expenses are down.

Hot Bank Companies To Invest In 2014: KeyCorp (KEY)

KeyCorp is a bank holding company for KeyBank National Association (KeyBank). Through KeyBank and certain other subsidiaries, the Company provides a range of retail and commercial banking, commercial leasing, investment management, consumer finance and investment banking products and services to individual, corporate and institutional clients through two business segments: Key Community Bank and Key Corporate Bank. As of December 31, 2011, these services were provided through KeyBank�� 1,058 full-service retail banking branches in 14 states, additional offices, a telephone banking call center services group and a network of 1,579 automated teller machines (ATMs) in 15 states. On January 17, 2012, the Company opened another national bank subsidiary.

In addition to the banking services of accepting deposits and making loans, the Bank and trust company subsidiaries offer personal and corporate trust services, personal financial services, access to mutual funds, cash management services, investment banking and capital markets products, and international banking services. Through its bank, trust company and investment adviser subsidiaries, the Company provides investment management services to clients that include corporate and public retirement plans, foundations and endowments, individuals and trust funds. The Company provides other financial services - both within and outside of its primary banking markets - through various nonbank subsidiaries. These services include community development financing, securities underwriting and brokerage. It is also an equity participant in a joint venture that provides merchant services to businesses.

Lending Activities

As of December 31, 2011, the Company�� Commercial, Financial and Agricultural loans, also referred to as Commercial and Industrial, represented 39% of its total loan portfolio. As of December 31, 2011, commercial real estate loans represented approximately 19% of its total loan portfolio. These loans include bo! th owner and nonowner-occupied properties and constitute approximately 27% of its commercial loan portfolio. Its commercial real estate lending business is conducted through two primary sources: its 14-state banking franchise, and Real Estate Capital and Corporate Banking Services. The Company conducts financing arrangements through its equipment finance line of business. Commercial lease financing receivables represented 17% of commercial loans at December 31, 2011. The home equity portfolio is the largest segment of its consumer loan portfolio.

Investment Activities

The Company�� securities portfolio totaled $18 billion at December 31, 2011. Available-for-sale securities were $16 billion at December 31, 2011. Held-to-maturity securities were $2.1 billion at December 31, 2011. At December 31, 2011, it had $2.1 billion in collateralized mortgage obligations (CMOs) in its held-to-maturity securities portfolio. At December 31, 2011, the Company had $15.9 billion invested in CMOs and other mortgage-backed securities in the available-for-sale portfolio. Federal Agency CMOs constitute most of its held-to-maturity securities along with foreign bonds and preferred equity securities. The investments in equity and mezzanine instruments made by its principal investing unit represented 61% of other investments at December 31, 2011. They include direct investments (investments made in a particular company), as well as indirect investments (investments made through funds that include other investors).

Sources of Funds

Domestic deposits are the Company�� primary source of funding. During the year ended December 31, 2011, these deposits averaged $58.5 billion and represented 80% of the funds it used to support loans and other earning assets. Wholesale funds, consisting of deposits in its foreign office and short-term borrowings, averaged $3.4 billion during 2011. At December 31, 2011, the Company had $4.7 billion in time deposits of $100,000 or more.

Advisors' Opinion:

• [By Eric Volkman]

  KeyCorp� (NYSE: KEY  ) �has a new individual occupying its CFO desk. That person is Donald Kimble, who will take up the position on June 3. In addition to his executive role, he will also serve on the banking group's management committee and its executive council.

• [By Monica Gerson]

  KeyCorp (NYSE: KEY) is estimated to report its Q3 earnings at $0.22 per share on revenue of $1.02 billion.

  St. Jude Medical (NYSE: STJ) is projected to report its Q3 earnings at $0.89 per share oor $1.32 billion.

• [By Rich Duprey]

  In a move that will catapult it into becoming the third-largest�servicer of commercial and multifamily loans in the U.S., KeyCorp (NYSE: KEY  ) announced yesterday that its commercial real estate arm, KeyBank Real Estate Capital, had�entered into a series of agreements with Bank of America (NYSE: BAC  ) to purchase the latter's commercial mortgage servicing portfolio of approximately�$110.5 billion as well as�a commercial mortgage-backed securities (CMBS) special servicing portfolio of about�$14 billion.

• [By Amanda Alix]

  Mortgages down, but commercial loans are up
  Like its peer Huntington Bancshares� (NASDAQ: HBAN  ) , New York Community saw a slowdown in residential mortgage refinancing�activity due to higher interest rates. But, like Huntington and KeyCorp (NYSE: KEY  ) , the bank was able to improve in other areas. New York Community enjoyed higher mortgage servicing income�in the second quarter, for example -- an area in which KeyCorp is also expanding, having recently acquired $110 billion in commercial loan servicing rights�from Bank of America (NYSE: BAC  ) earlier this year.

Hot Bank Companies To Invest In 2014: Signature Bank (SBNY)

Signature Bank (the Bank) is a full-service commercial bank with 25 private client offices located in the New York metropolitan area serving the needs of privately owned business clients and their owners and senior managers. The Bank offers a variety of business and personal banking products and services through the Bank, as well as investment, brokerage, asset management and insurance products and services through its wholly owned subsidiary, Signature Securities Group Corporation (Signature Securities), a licensed broker-dealer and investment adviser. Through Signature Securities, it also purchases, securitizes and sells the guaranteed portions of the United States Small Business Administration (SBA) loans. The Bank offers a variety of deposit, escrow deposit, credit, cash management, investment and insurance products and services to its clients. As of December 31, 2011, the Bank maintained approximately 78,000 deposit accounts, 6,900 investment accounts, 8,600 loan accounts and 14,300 client relationships. In April 2012, it formed a new subsidiary, Signature Financial, LLC.

The Bank offers a range of products and services oriented to the needs of its business clients, including deposit products, such as non-interest-bearing checking accounts, money market accounts and time deposits; escrow deposit services; cash management services; commercial loans and lines of credit for working capital and to finance internal growth, acquisitions and leveraged buyouts; permanent real estate loans; letters of credit; investment products to help better manage idle cash balances, including money market mutual funds and short-term money market instruments; business retirement accounts, such as 401(k) plans, and business insurance products, including group health and group life products. It offers a range of products and services oriented to the needs of its high net worth personal clients, including interest-bearing and non-interest-bearing checking accounts, with optional features, such as debit/ autom! ated teller machine (ATM) cards and overdraft protection and, for its clients, rebates of certain charges, including ATM fees; money market accounts and money market mutual funds; time deposits; personal loans, both secured and unsecured; mortgages, home equity loans and credit card accounts; investment and asset management services, and personal insurance products, including health, life and disability.

Lending Activities

The Bank�� commercial and industrial (C&I) loan portfolio is consisted of lines of credit for working capital and term loans to finance equipment, company owned real estate and other business assets, along with commercial overdrafts. Its lines of credit for working capital are generally renewed on an annual basis and its term loans generally have terms of 2 to 5 years. The Bank�� lines of credit and term loans typically have floating interest rates, and as of December 31, 2011, approximately 61% of its outstanding C&I loans were variable rate loans. As of December 31, 2011, funded C&I loans totaled approximately 15% of its total funded loans. The Bank�� real estate loan portfolio includes loans secured by commercial and residential properties. It also provides temporary financing for commercial and residential property. As of December 31, 2011, funded real estate loans totaled approximately $5.74 billion, representing approximately 80% of its total funded loans. It issues standby or performance letters of credit, and can service the international needs of its clients through correspondent banks. As of December 31, 2011, its commitments under letters of credit totaled approximately $235.7 million. Its personal loan portfolio consists of personal lines of credit and loans to acquire personal assets. As of December 31, 2011, its consumer loans totaled $11.8 million, representing less than 1% of its total funded loans.

Investment and Asset Management Products and Services

Investment and asset management products and services are ! provided ! through the Bank�� subsidiary, Signature Securities. Signature Securities is a licensed broker-dealer. Signature Securities is an introducing firm and, as such, clears its trades through National Financial Services, Inc., a wholly owned subsidiary of Fidelity Investments. Signature Securities is also registered as an investment adviser in New York, New Jersey, Pennsylvania and Florida. It offers an array of asset management and investment products, including the ability to purchase and sell all types of individual securities, such as equities, options, fixed income securities, mutual funds and annuities. The Bank offers transactional, cash management type brokerage accounts with check writing and daily sweep capabilities. It also offers retirement products, such as individual retirement accounts (IRAs) and administrative services for retirement vehicles, such as pension, profit sharing, and 401(k) plans to its clients. Signature Securities offers wealth management services to its high net worth personal clients. Together with its client and their other professional advisors, including attorneys and certified public accountants, it develops a financial plan that can include estate planning, business succession planning, asset protection, investment management, family office advisory services, bill payment, art and collectible advisory services and concentrated stock services.

Sources of Funds

The Bank offers a variety of deposit products to its clients. Its business deposit products include commercial checking accounts, money market accounts, escrow deposit accounts, lockbox accounts, cash concentration accounts and other cash management products. Its personal deposit products include checking accounts, money market accounts and certificates of deposit. The Bank also allows its personal and business deposit clients to access their accounts, transfer funds, pay bills and perform other account functions over the Internet and through ATM machines. As of December 31, 2011, it main! tained ap! proximately 78,000 deposit accounts representing $11.70 billion in client deposits, excluding brokered deposits.

Insurance Services

The Bank offers its business and private clients an array of individual and group insurance products, including health, life, disability and long-term care insurance products through its subsidiary, Signature Securities. The Bank does not underwrite insurance policies. It only acts as an agent in offering insurance products and services underwritten by insurers.

Best Financial Companies To Invest In 2014: Banco Bradesco SA (BBD)

Banco Bradesco S.A. (the Bank), incorporated on November 5, 1943, is commercial bank. The Bank offers a range of banking and financial products and services in Brazil and abroad to individuals, large, midsized and small companies and local and international corporations and institutions. It operates in two segments: the banking, and the insurance, pension and capitalization bonds. Its products and services encompass banking operations, such as loans and advances and deposittaking, credit card issuance, purchasing consortiums, insurance, leasing, payment collection and processing, pension plans, asset management and brokerage services. The main services it offers through Bradesco Expresso are receipt and submission of account applications; receipt and submission of account applications; Social Security National Service (INSS) benefit payments; checking and savings account deposits, and receipt of consumption bills, bank charges and taxes. In May, 2011, the Bank acquired Banco do Estado do Rio de Janeiro S.A. (BERJ).

Banking

The Banking segment includes deposit-taking with clients, including checking accounts, savings accounts and time deposits; loans and advances (individuals and companies, real estate financing, microcredit, onlending BNDES funds, rural credit, leasing, among others); credit cards, debit cards and pre-paid cards; management of receipts and payments; asset management; services related to capital markets and investment banking activities; intermediation and trading services; custody, depositary and controllership services; international banking services, and purchasing consortiums.

The Bank offers a variety of deposit products and services to our customers through its branches, including Non-interest bearing checking accounts, such as Easy Account, Click Account, Academic Account and Cell Phone Bonus Account; traditional savings accounts; time deposits, and deposits from financial institutions. As of December 31, 2011, it had 43.4 million savings a! ccounts. It offers its customers certain additional services, such as identified deposits and real-time banking transfers. Its loans and advances to customers, consumer credit, corporate and agricultural-sector loans, totaled R$263.5 billion as of December 31, 2011.

The Bank�� loan portfolio consists of short-term loans, vehicle financings and overdraft loans on checking accounts. It also provides revolving credit facilities and traditional term loans. As of December 31, 2011, it had outstanding advances, vehicle financings, consumer loans and revolving credit totaling R$58.0 billion, or 22.0% of its portfolio of loans and advances. Banco Bradesco Financiamentos (Bradesco Financiamentos) offers direct-to-consumer credit and leasing for the acquisition of vehicles and payroll-deductible loans to the public and private sectors 'in Brazil. Supported by BF Promotora de Vendas Ltda. (BF Promotora), and using the Bradesco Financiamentos brand, the Bank operates through its network of correspondents in Brazil, consisting of retailers and dealers selling light vehicles, trucks and motorcycles, to offer financing and/or leasing for vehicles. Through Bradesco Promotora brand, it offer payroll-deductible loans to social security retirees and pensioners, public-sector employees, military personnel and private-sector companies sponsoring plans, and other aggregated products (insurance, capitalization bonds, cards, purchasing consortiums, and others).

As of December 31, 2011, the Bank had 63,156 outstanding real estate loans. As of December 31, 2011, the aggregate outstanding amount of its real estate loans amounted to R$15.9 billion, representing 6% of its portfolio of loans and advances. As of December 31, 2011, it had 69,491 microcredit loans outstanding, totaling R$62.8 million. Its BNDES onlending portfolio totaled R$35.4 billion as of December 31, 2011.

The Bank provides traditional loans for the ongoing needs of its corporate customers. It had R$85.8 billion of outstand! ing other! local commercial loans, accounting for 32.5% of its portfolio of loans and advances as of December 31, 2011. It offers a range of loans to its Brazilian corporate customers, including short-term loans of 29 days or less; guaranteed checking accounts and corporate overdraft loans; discounting trade receivables, promissory notes, checks, credit card and supplier receivables, and a number of other receivables; financing for purchase and sale of goods and services; corporate real estate financing, and investment lines for acquisition of assets and machinery. As of December 31, 2011, the Bank had R$11 billion in outstanding rural loans, representing 4.2% of its portfolio of loans and advances. The Bank conducts its leasing operations through its primary leasing subsidiary, Bradesco Leasing and also through Bradesco Financiamentos.

The Bank offers electronic solutions for receipt and payment management solutions, which include collection and payment services and online resource management enabling its customers to pay suppliers, salaries, and taxes and other levies to governmental or public entities. The global cash management concept provides solutions for multinationals in Brazil and/or domestic companies operating abroad. It manages third-party assets through mutual funds; individual and corporate investment portfolios; pension funds, including assets guaranteeing the technical provisions of Bradesco Vida e Previdencia, and insurance companies, including assets guaranteeing the technical provisions of Bradesco Seguros.

The Bank�� subsidiaries Bradesco S.A. CTVM and Agora S.A. CTVM (or Bradesco Corretora and Agora Corretora, respectively) trade stocks, options, stock lending, public offerings and forwards. They also offer a range of products, such as Brazilian government securities (under the Tesouro Direto program), BM&F trading, investor clubs and investment funds.

The Bank offers a range of international services, such as foreign exchange transactions, foreign tr! ade finan! ce, lines of credit and banking. As of December 31, 2011, its international banking services included New York City, a branch and Bradesco Securities Inc., its subsidiary brokerage firm, or Bradesco Securities United States, and its subsidiary Bradesco North America LLC, or Bradesco North America; London, Bradesco Securities U.K., its subsidiary, or Bradesco Securities U.K.; Cayman Islands, two Bradesco branches and its subsidiary, Cidade Capital Markets Ltd., or Cidade Capital Markets; Argentina, Banco Bradesco Argentina S.A., its subsidiary, or Bradesco Argentina; Banco Bradesco Luxemburgo S.A. its subsidiary, or Bradesco Europe; Japan, Bradesco Services Co. Ltd., its subsidiary, or Bradesco Services Japan; in Hong Kong, its subsidiary Bradesco Trade Services Ltd, or Bradesco Trade, and in Mexico, its subsidiary Ibi Services, Sociedad de Responsabilidad Limitada, or Ibi Mexico.

The Bank�� Brazilian foreign-trade related business consists of export and import finance. In addition to import and export finance, its customers have access to a range of services and foreign exchange products, such as purchasing and selling travelers checks and foreign currency paper money; cross border money transfers; advance payment for exports; accounts abroad in foreign currency; cash holding in other countries; collecting import and export receivables; repaid cards with foreign currency (individual), and structured foreign currency transactions through its foreign units.

Insurance, pension plans and capitalization bonds

The Bank offers insurance products through a number of different entities, which it refers to collectively as Grupo Bradesco Seguros. It offers life, personal accident and random events insurance through its subsidiary Bradesco Vida e Previdencia. It offers health insurance policies through Bradesco Saude and its subsidiaries for small, medium or large companies. It provides automobile, property/casualty and liability products through its subsidiary Bradesco Auto! /RE. It a! lso offers certain automobile, health, and property/casualty insurance products directly through its Website.

Advisors' Opinion:

• [By Charles Sizemore]

  And speaking of top dividend stocks with high capital gains potential, next on the list of are Brazilian banking groups Banco Bradesco (BBD) and Banco Itau (ITUB) — two monthly dividend stocks you must consider.

• [By Jon C. Ogg]

  Banco Bradesco S.A. (NYSE: BBD) is one of the key banks and financial services companies in Brazil. A Yahoo! Finance reference showed that the 2012 figures were as follows: 4,686 branches; 34,859 ATMs; 12,975 shared ATMs under the Banco24Horas brand; and 5,237 special points of banking services. At $11.65, the 52-week trading range is $11.29 to $17.79. This ADR is down 7% so far in 2014.

Hot Bank Companies To Invest In 2014: Goldman Sachs Group Inc.(The)

The Goldman Sachs Group, Inc., together with its subsidiaries, provides investment banking, securities, and investment management services to corporations, financial institutions, governments, and high-net-worth individuals worldwide. Its Investment Banking segment offers financial advisory, including advisory assignments with respect to mergers and acquisitions, divestitures, corporate defense, risk management, restructurings, and spin-offs; and underwriting securities, loans and other financial instruments, and derivative transactions. The company?s Institutional Client Services segment provides client execution activities, such as fixed income, currency, and commodities client execution related to making markets in interest rate products, credit products, mortgages, currencies, and commodities; and equities related to making markets in equity products, as well as commissions and fees from executing and clearing institutional client transactions on stock, options, and fu tures exchanges. This segment also engages in the securities services business providing financing, securities lending, and other prime brokerage services to institutional clients, including hedge funds, mutual funds, pension funds, and foundations. Its Investing and Lending segment invests in debt securities, loans, public and private equity securities, real estate, consolidated investment entities, and power generation facilities. This segment also involves in the origination of loans to provide financing to clients. The company?s Investment Management segment provides investment management services and investment products to institutional and individual clients. This segment also offers wealth advisory services, including portfolio management and financial counseling, and brokerage and other transaction services to high-net-worth individuals and families. In addition, it provides global investment research services. The company was founded in 1869 and is headquartered in New York, New York.

Hot Bank Companies To Invest In 2014: Banco Bilbao Vizcaya Argentaria S.A. (BBVA)

Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) is a diversified international financial group, with strengths in the traditional banking businesses of retail banking, asset management, private banking and wholesale banking. The Company also has investments in some of Spain�� companies. During the year ended December 31, 2009, BBVA focused its operations on six major business areas: Spain and Portugal, Wholesale Banking and Asset Management, Mexico, The United States, South America and Corporate Activities. On August 21, 2009, through its subsidiary BBVA Compass, BBVA acquired certain assets of Guaranty from the United States Federal Deposit Insurance Corporation (the FDIC).

Spain and Portugal

The Spain and Portugal business area focuses on providing banking services and consumer finance to private individuals, enterprises and institutions in Spain and Portugal. The main business units included in the Spain and Portugal area Spanish Retail Network, which manages individual customers, high net-worth individuals (private banking) and small companies and retailers in the Spanish market; Corporate and Business Banking, which manages business with small and medium enterprises (SMEs), large companies, institutions and developers in the Spanish market, and Other units, which includes consumer finance, that manages renting and leasing business, credit to individual and to enterprises for consumer products and Internet banking; European Insurance that manages the insurance business in Spain and Portugal, and BBVA Portugal, that manages the banking business in Portugal. The Spanish Retail Network unit services the financial and non-financial needs of households, professional practices, retailers and small businesses. The Corporate and Business Banking unit offers a range of services and products to SMEs, large companies, institutions and developers with specialized branch networks for each segment.

The Company�� European Insurance unit�� activities are conducted through! various insurance companies that provide direct insurance, reinsurance and insurance brokering services in Spain and Portugal and market products for different types of customers (private individuals, SMEs, retailers, professional service firms and providers and self-employed individuals) through this unit�� branch offices. BBVA Portugal manages its banking business in Portugal.

Wholesale Banking and Asset Management

The Wholesale Banking and Asset Management area focuses on providing services to large international companies and investment banking, capital markets and treasury management services to clients. The business units included in the Wholesale Banking and Asset Management area are Corporate and Investment Banking, which coordinates origination, distribution and management of a complete catalogue of corporate and investment banking products (corporate finance, structured finance, syndicated loans and debt capital markets) and provides global trade finance and global transaction services with coverage of large corporate customers specialized by sector (industry bankers); Global Markets, which handles the origination, structuring, distribution and risk management of market products, which are placed through its trading rooms in Europe, Asia and the Americas; Asset Management, which designs and manages the products that are marketed through its different branch networks including traditional asset management, alternative asset management and Valanza (its private equity unit); Industrial and Other Holdings, which helps to diversify the area�� businesses with the aim of creating medium and long-term value through active management of a portfolio of industrial holdings and other Spanish and international projects, and Asia.

During the year ended December 31, 2009, it launched two products: BBVA Bonos Cash (BBVA Cash Bonds), a money market fund for retail customers, and BBVA Bonos Largo Plazo Gobiernos II (BBVA Long-Term Government Bonds), a public-debt fu! nd. In ad! dition it launched through this unit additional fixed-income long-term funds, including BBVA Bonos Corporativos 2011 and BBVA Bonos 2014, which were sold to HNWI customers.

Mexico

The business units included in the Mexico area are Retail and Corporate banking and Pensions and Insurance. BBVA Bancomer launched six new mortgage products for lending to home buyers in 2009. These products included: loans for home improvements, remodeling or additions to homes and financial discount which provides liquidity to construction companies. In Mexico, it operates its pensions business through Afore Bancomer, its insurance business through Seguros Bancomer, its annuities business through Pensiones Bancomer and its health insurance business through Preventis.

The United States

The business units included in the United States area are BBVA Compass and Other units: BBVA Puerto Rico and Bancomer Transfers Services (BTS). During 2009 this unit marketed and sold several new products, The ClearPoints credit card, Business Build-to-order Checking, Compass for your Cause and Money Market Sweep.

South America

The South America business area includes its banking, insurance and pension businesses in South America. The business units included in the South America business area are Retail and Corporate Banking, which includes banks in Argentina, Chile, Colombia, Panama, Paraguay, Peru, Uruguay and Venezuela; Pension businesses, which includes pensions businesses in Argentina, Bolivia, Chile, Colombia, Ecuador and Peru and Dominican Republic, and Insurance businesses, which includes insurance businesses in Argentina, Chile, Colombia, Dominican Republic and Venezuela.

Corporate Activities

The Corporate Activities area handles its general management functions. These mainly consist of structural positions for interest rates associated with the euro balance sheet and exchange rates, together with liquidity management and shareholde! rs��fun! ds.

Advisors' Opinion:

• [By John Udovich]
  A.F.P Provida SA. A Chile-based company�involved in the management of private pension funds, A.F.P Provida SA�� activities include the investment and collection of its clients��contributions, the management of individual capitalization accounts and the provision of life and disability benefits, payments of funeral expenses and senior retirement pensions. A.F.P Provida SA also has operations through its subsidiaries in Peru, Ecuador and Mexico. Under former dictator Pinochet,�Chile privatized its otherwise bankrupted social security program�and mandates its citizens to invest a certain portion of their wages with government-endorsed asset management firms like A.F.P Provida SA. Right now, A.F.P Provida SA has a trailing P/E of 6.33 along with a forward dividend of $10.89 for a 12% dividend yield, but there is also a big catch. Back in February, it was reported that Metlife Inc (NYSE: MET) would acquire the firm from Banco Bilbao Vizcaya Argentaria SA (NYSE: BBVA) in a deal valued at about $2 billion in order to add fee income in Latin America���meaning that juicy dividend is no longer a sure bet for investors. On Monday, small cap A.F.P Provida SA rose 0.28% to $90.80 (PVD has 52 week trading range of $82.60 to $112.79 a share) for a market cap of $2.01 billion plus the stock is down 9.1% since the start of the year, up 2.3% over the past year and up 205.7% over the past five years.

U.S. Homebuilder Confidence Slips in January

Gregory Bull/AP NEW YORK -- U.S. homebuilder confidence faded a bit at the start of 2014, although most developers expected the housing recovery to continue, data from the National Association of Home Builders released Thursday showed. The NAHB/Wells Fargo Housing Market Index slipped to 56 points in January from a downwardly revised 57 in December. The December reading originally reported at 58 was the highest level since August. Economists polled by Reuters had forecast a January reading of 58, with a reading of 50 or higher indicating more builders view conditions as good than poor. "Following an unexpected jump last month, builder confidence has essentially leveled out and is holding at a solid level," NAHB Chairman Rick Judson said in a statement. "Many markets continue to improve and this bodes well for future home sales." The homebuilder confidence index, which is seen as a proxy on housing construction, has been above 50 for eight straight months. The Commerce Department will release December data on housing starts Friday. Economists polled by Reuters forecast developers broke ground for single-family homes and apartment buildings at an annualized rate of 990,000 units last month. It followed a November pace of 1.091 million units which was the strongest level since February 2008. All three NAHB survey components fell in January from their December levels. The measure on homebuilders' view on current sales conditions fell to 62 from a downwardly revised 63. The initially reported December reading of 64 was the highest level since December 2005. The index on expectations on future sales fell 2 points to 60, while the gauge on traffic of prospective buyers declined to 40 from downwardly revised 43. "Rising home prices, historically low mortgage rates and significant pent-up demand will drive a continuing, gradual recovery in the year ahead," said NAHB Chief Economist David Crowe.

Are the Stars Aligning for Constellation Brands?

Ever since Constellation Brands (NYSE: STZ  ) acquired Grupo Modelo's U.S. beer business from Anheuser-Busch InBev (NYSE: BUD  ) for nearly $5 billion, the company has been seeing unprecedented success. Perhaps it's a sign Anheuser-Busch InBev sold out too cheap, or worse, a sign of inept management. In any event, Anheuser-Busch InBev's loss is Constellation Brands' gain as it competes against other hot beer brands such as those from Boston Beer (NYSE: SAM  ) .

Constellation Brands results
On Jan. 8, Constellation Brands reported its third-quarter fiscal results. Net sales soared 88% to $1.443 billion. Operating income jumped 129% to $364 million. Diluted earnings per share rocketed 84% to $1.07. While much of the growth was due to the acquisition, Constellation Brands experienced great organic operating results due to successful execution as well.

CEO Rob Sands credited in part the momentum in sales of Corona and Modelo Especial coming from the summer months and continuing into the fall and holiday season. He pointed out that "new marketing campaigns" and "distributor execution" helped contribute to the success. The Nava brewery in Mexico also helped and "expansion activities continue to proceed." This implies that Constellation Brands fully expects higher demand and sales going forward.

In last quarter's report, Constellation Brands gave some details that foreshadowed this quarter's results. The company stated, "Overall, we are well positioned to generate organic growth throughout the remainder of the year ... Modelo Especial Chelada will roll out in key markets earlier this week and will be supported by national Hispanic TV advertising."

Not just beer
While all beer brands themselves experienced double-digit percentage volume growth, "continuing to significantly outperform the growth of the U.S. beer market," beer isn't the only thing leading Constellation Brands to stardom. The company saw wine sales accelerate throughout the quarter, which outperformed the U.S. wine market across all channels. For the full fiscal year ending in February, Constellation Brands expects to report earnings per share of between $3.10 and $3.20.

Conference call
During the call, Sands gave a bit more detail. Modelo Especial sales flew 18% and Corona Extra hopped up 6%. The company's draft business grew by 30% and is expected to grow even further as Corona Light draft is rolled out nationally following successful test markets. CFO Robert Ryder expects Corona Light to become the company's biggest draft brand. He points out that draft sales help increase case sales as well, since having the taps in front of the consumer helps with marketing.

Can it continue to rapidly grow beer?
You may be wondering if it's even possible for brands that have been around for a while like Corona and Modelo Especial to continue to grow rapidly. Look to Boston Beer for an example that says "Yes." Boston Beer has been brewing Samuel Adams beer for more than 30 years, but the brand is growing as if it were launched just yesterday. Last quarter, Boston Beer reported sales that leaped 30% to $216.1 million, and adjusted earnings per share popped 30.1%. In fact, demand was so great last quarter that the company actually ran into a shortage of beer and is struggling to expand capacity fast enough.

Foolish final thoughts
Constellation Brands is brewing up runaway success with its new brands in a way that the behemoth Anheuser-Busch InBev couldn't. This suggests a very well-run company that may be capable of more surprises. Constellation Brands deserves a closer look by Fools searching for a company with great numbers with the potential to surprise to the upside due to strong management.

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It's Time To Be Bearish on DRAM Manufacturers

Spot prices of DRAM modules have risen dramatically over the last year, mainly due to its limited supply. And a recent fire at one of the DRAM manufacturing facilities in Wuxi, owned by SK Hynix, further reduced the global DRAM manufacturing capacity by 13%.

This supply shortage pushed DRAM even higher, boosting the profit margins of Micron (NASDAQ: MU  ) , SK Hynix, and Samsung (NASDAQOTH: SSNLF  ) . However, in light of some recent developments, there is reason to believe that this pricing advantage enjoyed by DRAM manufacturers could be short lived.

Rising Supplies
The fire-hit Wuxi plant, with a monthly production capacity of about 130,000 DRAM modules, had created a supply crunch of DRAM modules across the globe. But DRAMeXchange expects the plant to become fully operational during this January.

While the quick recovery is good for SK Hynix, it raises concerns regarding the global DRAM prices. In a research note, David Wong of Wells Fargo stated:

We think DRAM output from Hynix could rise substantially over the next few weeks while DRAM demand moves into the seasonally weak period of the year, potentially resulting in significant pressure on DRAM prices.

But, the DRAM output hike isn't attributable to just SK Hynix.

Shortly after the Wuxi plant caught fire, Samsung boosted its DRAM production by about 30,000 wafers per month to make up for the supply shortfall. This represents a 3% increase in the global DRAM production capacity. Now that the Wuxi plant is about to resume its full-fledged operations, Samsung hasn't yet announced any plans to roll back its production levels. In fact, heading into 2014, TrendForce estimates that Samsung will allocate about 25% of its manufacturing capacity for the production of DRAM modules – up from the current 20%.

These production hikes have led analysts at Wells Fargo and TrendForce to conclude that DRAM prices have peaked. And keeping these bearish estimates in mind, investors should tread carefully when considering Micron for investment purposes.

Top Undervalued Companies To Watch For 2014

Impact on Micron
Micron is the third largest DRAM manufacturer, commanding an estimated market share of almost 27.4%. Its stock price has more than tripled over the last year, as its acquisition of Elpida Memory has strengthened its market position and expanded its manufacturing capacity. And the recent deal between Apple (NASDAQ: AAPL  ) and China Mobile has made Micron an even more attractive investment option.

China Mobile is the world's largest wireless network company with about 760 million subscribers; starting this month, it will offer Apple iPhones on its fourth-generation network. Piper Jaffray analyst Gene Munster estimates that this Apple-China Mobile partnership will result in incremental annual sales of up to 17 million iPhones. Since Apple uses about 80% of Elpida's mobile DRAM manufacturing capacity, the incremental iPhone sales should fuel Micron's revenue growth.

However, investors shouldn't get too carried away with these bullish statements. Micron involves a great deal of risk as well.

Micron hasn't announced any plans to expand its production capacity yet. This can hamper its volumetric growth, and the memory module manufacturer might find it hard to grow its revenue if DRAM prices decline. Considering that Micron generates about 48% of its revenue from PC-DRAM sales, a slide in DRAM prices will have a direct impact on its profitability as well.

So, investors need to weigh the risks involved with investing in Micron. The Apple-China Mobile might boost Micron's volumetric growth, but the declining DRAM prices can offset those gains very quickly and result in dismal quarterly financials.

How to proceed
Reports by Wells Fargo and TrendForce suggest that DRAM prices could retract due to its rising supply, and RBC Capital doubts if Micron can retain its growth momentum. So, risk-averse investors might want to avoid investing in the memory-module manufacturer, due to its huge exposure to the DRAM industry.

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And Wall Street's Best Athlete Is ...

Courtesy of the RBC Decathlon RBC Decathlon winner Mark Rubin, flanked by runners-up Jay Li (left) and Collin Zych. The men and women of Wall Street aren't just richer than you are -- some of them are also capable of running circles around you, bench-pressing you, or destroying you in a pick-up football game. The second annual RBC Decathlon took place Sunday, a chance for the traders and executives of Wall Street to test their speed, strength and endurance against one another. The men's winner was Mark Rubin, an assistant vice president of options sales trading at Barclays Capital. As Bloomberg points out, he's also a legitimate athlete: He played safety on Penn State's football team and spent a brief time in the NFL before taking his talents to Wall Street. It's his second straight year winning the title, and at 27 years old, we'd say he's got plenty of good years left in him. The women's winner was Evelyn Konrad of Standard & Poor's. The competition isn't just another excuse for rich kids to one-up each other: It also sends a significant amount to charity, with competitors collecting sponsorships from their employers. This year's event raised $1.3 million for the Memorial Sloan-Kettering Center. Nor is the Decathlon for the faint of heart. Competitors run a gauntlet of physical challenges, including a bench press, an 800-meter run, a 500-meter row and a football-throwing competition. Of course, not everyone on Wall Street is a strapping 20-something a few years removed from a Division I football career. There's also a competition between Wall Street executives, and this year Clinton Biondo of Fir Tree Partners won the "Top Executive" trophy.

Now Geeks Can Go Weeks in the Same Pants

One up-and-coming trend investors should be aware of is that of wearable technology. It's best-known these days in the form of activity-monitoring wristbands from Nike and Fitbit, Google Glass, and of course Apple's long-rumored iWatch.

At the recent CE Week in New York City, however, Motley Fool analyst Rex Moore found evidence that serious fashion designers are joining the trend and are already putting out some interesting merchandise -- from temperature-regulating jackets to shoes made from a 3-D printer. Apple- and Android-device users can also celebrate the wide variety of fashion products for their toys, including an ingenious wearable iPad case.

The highlight of the week was the Fashion Ware runway show, produced by Living in Digital Times. Rex spoke with founder Robin Raskin about some of the interesting items featured in the show -- including pants enhanced by nanotechnology that won't need changing for weeks.

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Can Facebook Continue to Explode to the Upside?

With shares of Facebook (NASDAQ:FB) trading around $58, is FB an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Facebook is engaged in building social products in order to create utility for users, developers, and advertisers. People use Facebook to stay connected with their friends and family, to discover what is going on in the world around them, and to share and express what matters to them with the people they care about. Developers can use the Facebook platform to build applications and websites that integrate with Facebook to reach its global network of users, building personalized and social products. Advertisers can engage with more than 900 million monthly active users on Facebook — or subsets of its users — based on information they have chosen to share.

Facebook has acquired Indian startup Little Eye Labs to help strengthen its mobile strategy. It's the first acquisition of an Indian company by the social networking giant. The Bangalore-based startup confirmed the deal on its official website. Little Eye Labs make a tool to analyze the performance of apps. The software helps Android app developers analyze, measure, and monitor their apps. They can estimate the app's usage, network data consumption and memory, and visualize its behavior.

T = Technicals on the Stock Chart Are Strong

Facebook stock has been exploding to the upside in recent years. The stock is currently trading near all time highs and looks poised to continue. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Facebook is trading above its rising key averages, which signal neutral to bullish price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of Facebook options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	Best Blue Chip Stocks For 2014 30-Day IV Percentile	90-Day IV Percentile
Facebook options	52.53%	90%	88%

What does this mean? This means that investors or traders are buying a very significant amount of call and put options contracts, as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
February Options	Flat	Average
March Options	Flat	Average

As of today, there is an average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a very significant amount of call and put option contracts and are leaning neutral to bullish over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Increasing Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Facebook’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Facebook look like and more importantly, how did the markets like these numbers?

	2013 Q3	2013 Q2	2013 Q1	2012 Q4
Earnings Growth (Y-O-Y)	108.33%	58.33%	0.00%	-89.46%
Revenue Growth (Y-O-Y)	59.75%	53.13%	37.81%	40.14%
Earnings Reaction	2.44%	29.61%	5.61%	-0.83%

Facebook has seen increasing earnings and revenue figures over the last four quarters. From these numbers, the markets have been pleased with Facebook’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has Facebook stock done relative to its peers, Microsoft (NASDAQ:MSFT), Google (NASDAQ:GOOG), LinkedIn (NASDAQ:LNKD), and sector?

	Facebook	Microsoft	Google	LinkedIn	Sector
Year-to-Date Return	5.91%	-4.41%	1.89%	-3.69%	-1.07%

Facebook has been a relative performance leader, year-to-date.

Conclusion

Facebook looks to provide a valuable social networking experience to its users, developers, and advertisers. The company has acquired Indian startup Little Eye Labs to help strengthen its mobile strategy. The stock has been exploding to the upside and is now trading near all time high prices. Over the last four quarters, earnings and revenues have been increasing, which has left investors pleased about recent earnings announcements. Relative to its peers and sector, Facebook has been a year-to-date performance leader. Look for Facebook to continue to OUTPERFORM.

Oil Collapse Fears Could Drive Refiners Higher, Howard Weil Says

Will the price of oil collapse this year? Investors are worried they will and that could push refiners like Phillips 66 (PSX) and PBF Energy (PBF) higher.

Bloomberg News

Howard Weil’s Blake Fernandez and Richard Roberts explain:

We are witnessing a rotation from U.S. centric Independent E&P's toward Independent Refiners in an effort to hedge the risk of collapsing domestic crude prices. From a global perspective, macro [refining & marketing] dynamics are improving into '14 with significant crude supply growth placing a theoretical ceiling on oil prices / feedstock costs while underlying demand growth remains intact thereby supporting product prices…

That said we are recommending a slight tactical shift toward more defensive posturing with a focus on lower beta names and companies that screen at a discount from a valuation perspective. As a result, we are
downgrading [Delek US Holdings (DK)] and [Tesoro (TSO)] to Sector Perform and upgrading [Phillips 66] and [PBF Energy] to Sector Outperform.

Shares of Phillips 66 have dropped 0.2% to $76.86, today, while PBF Energy has gained 0.3% to $28.58, Delek US Holdings has dropped 3.4% and Tesoro has fallen 1.8% to $57.02.