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This Bermuda-based company is making a handsome profit on America's energy boom. It makes a critical, unique tool that energy companies desperately need. And they're willing to pay $635,000 a day to use it. This company owns 69 of them. That's $43.8 million a day in revenue. Its reach extends all over the world.
No wonder it can afford to pay shareholders 10.32% . And you can buy it for less than $40. I expect it to hit $48 in the next 12 months. That's a 31% total gain! It's just one of 5 companies in my "secret" blueprint for income. Discover them all here.
| | | 10/22/2014 By Chad Fraser 
Most investors are ignoring the best dividend opportunities on the market today.
Here's why:
According to research from Henderson Global Investors, shareholders around the world pocketed a total of $1.03 trillion in dividends last year, breaking the trillion-dollar mark for the first time.
But what many American investors don't know is that U.S. companies only account for about a third of that $1.03-trillion total. So in effect, if you focus only on the U.S.---as most investors do---you're cutting yourself off from a treasure trove of international dividends.
What's more, global stocks typically boast higher payouts than their U.S. counterparts. Right now, for example, the S&P 500 yields around 2%, while U.K. stocks boast an average yield of 3.5%. European stocks offer 3.3%, and Australian stocks come in around 3.2%.
Below, I'll show you how to get instant access to a special report that reveals our top 5 high-income picks from around the world (including the U.S.) at no cost whatsoever. It comes straight from the desk of Richard Stavros, chief strategist at our new Global Income Edge advisory.
But first, here's a look at a simple way to give your portfolio a more international flavor.
ADRs Make International Investing a Snap
One thing all 5 of Stavros's picks have in common is that they trade here in the U.S., on the NYSE and NASDAQ, as American Depositary Receipts (ADRs).
That's a big plus, because you can buy and sell ADRs through your broker, just like any U.S. stock. In addition to the major exchanges, ADRs trade on the Over-the-Counter Bulletin Board or Pink Sheets. Their prices are determined by supply and demand, but they generally track the underlying ordinary share.
With ADRs, you can skip the extra cost, difficulty and risk of buying shares in unfamiliar countries, as well as the hassle of currency conversion. That's because all ADR transactions---including dividend payments---are conducted in U.S. dollars.
Here's a bird's-eye view of how ADRs work.
The Nuts and Bolts of ADRs
To create an ADR, a U.S. bank (called a depositary bank) buys shares of a foreign company in its home country. It then deposits them with a local bank (or custodian), often a branch, and issues ADRs representing a certain number of shares.
JPMorgan Chase (NYSE: JPM) launched the first ADR on April 29, 1927, for U.K. retailer Selfridges. The Selfridges ADR was listed on the New York Curb Exchange, the American Stock Exchange's predecessor. Today, there are more than 2,000 ADRs available to U.S. investors.
One ADR may represent one or more shares of the foreign stock; it can also represent a fraction of a share. The depositary bank sets this ratio with the goal of establishing a price that's high enough to demonstrate real value but low enough to attract individual investors.
For example, one ADR of Netherlands-based consumer giantUnilever NV(AMS: UNA, NYSE: UN), which trades under the UN symbol, represents one ordinary share on the Amsterdam Stock Exchange under the UNA symbol. Meanwhile, one ADR of Japanese carmaker Toyota Motor Company (TYO: 7203, NYSE: TM), trading under the TM symbol, represents two common shares.
The U.S. depositary bank handles most interactions with U.S. investors, including rights offerings, stock splits and dividends. However, ADR investors may receive communications, including financial statements, directly from the company.
As an ADR holder, you always have the right to obtain the stock your receipt represents, but most investors find it easier to simply hold the ADR.
There are two types of ADRs: sponsored ADRs, which are initiated by the company itself, and unsponsored ADRs, which are created by a U.S. bank without the issuer's active participation, usually in response to investor demand. Unsponsored ADRs can only trade on the over-the-counter market.
The sponsored category consists of three levels: - A Level I sponsored ADR allows a company to extend the market for its securities to the U.S. with minimal Securities and Exchange Commission (SEC) reporting requirements. It is also under no obligation to conform to generally accepted accounting principles (GAAP). Level I ADRs can only be listed on the over-the-counter market.
- Level II and Level III sponsored ADRs are required to register and file annual reports with the SEC, and financial statements must be reconciled to GAAP. A Level III ADR program is also required if an issuer wants to raise capital through a public offering of ADRs in the U.S.
Only Level II and Level III sponsored ADRs can be listed on the NYSE or NASDAQ. They must also meet the requirements of their particular exchange. Get Our Top 5 Global Income Picks FREE
As I mentioned above, Global Income Edge chief strategist Richard Stavros has just released a brand new report containing our top 5 high-dividend picks now. It's called "Income Afterburners," and it reveals stocks boasting yields of 5.2% ... 6.9% ... even 10.0%. AND they could turn into 10-bagger growth plays, to boot!
This exclusive report gives you everything you need to know, including names, ticker symbols, prices to buy under and much more.
If you need income and you need it now, "Income Afterburners" will be a godsend.
Best of all, today we're making it available to Investing Daily readers like you absolutely free.
Click here to get full details and grab your copy now. | | |
We're about to pull wraps off an exciting new income service. It's powered by a revolutionary new platform called the Income Blueprint Formula. I promise you, when you see the kind of payouts that are possible by following this lucrative advice, you'll want a piece of the action. And that's exactly what you'll get – in addition to a $300 limited-time launch discount – when you click here.
| | | 10/22/2014 By Robert Rapier 
You want to be greedy when others are fearful. You want to be fearful when others are greedy. It's that simple. -- Warren Buffett That's pretty good general advice from Warren Buffett. Buy when the market is selling, sell when it is buying. However, it requires conviction because it means you are constantly buying and selling against conventional wisdom. The market has certainly been selling off energy stocks. The general sentiment is bearish. Should we adhere to Buffett's advice now and buy? If so, buy what? One problem is that his advice is very subjective. There is no measure of what "others" stands for. Are you supposed to buy when 50% of investors are fearful? 90%? And how would you measure that anyway? If the price of oil plunges from $110 to $40 a barrel, wasn't it clear that "others were fearful" after the price had dropped $30? In any case, I think Buffett's philosophy here provides a good guideline. At least it does for me. Here is how I have applied it. Fearful in 2014 At the beginning of 2014, I was "fearful" that oil prices were going to decline. As a result, my colleague Igor Greenwald and I wrote a number of articles about downside risk, and the potential for lower short-term oil prices. This year we believed the supply/demand fundamentals would start to favor a growing oil supply. In fact, I lower oil prices in 2014 was one of my annual predictions in January. That prediction looked wrong during the first half of 2014 -- at least for West Texas Intermediate (WTI). Even though I believed the oil market was behaving somewhat irrationally, by July I was pretty sure that I was going to end up on the wrong side of this prediction. But so far in the second half of year it seems as if oil prices are trying to make up for their lofty levels in the first half. A month ago, I noted that the price of West Texas Intermediate would need to average below $92 a barrel (bbl) for the rest of 2014 in order for my oil price prediction to prove accurate. The price has since declined below $92, and is trading at $83.40 as I write this. Given my "fear" of lower oil prices this year, how did that affect my own investment decisions? First, bear in mind that your risk tolerance may be very different from mine. I am fairly risk averse, but I will hold a quality company through a 25% correction unless I feel the long-term fundamental outlook has changed. This doesn't make my style right or wrong. Investors have to be comfortable with their own balance of fear and greed so as not to sell after the market has crashed and buy once it has surged. My style generally sacrifices some of my upside to protect the downside. I prefer to invest in consistently profitable companies that aren't highly leveraged. As a result, I generally avoid the high flyers -- especially when I feel like oil prices will soften -- so I kept some cash on the sidelines as 2014 unfolded, while holding on to some holdings that I felt had limited downside. Steering Clear of the High Flyers With my expectations for 2014 oil prices in mind, here is how I tend to view a company like Laredo Petroleum (NYSE: LPI). Laredo is a pure-play Permian Basin oil and gas producer, with crude accounting for 58% of recent production. The company has managed to grow output by a compounded annual growth rate of 30% for the past three years. Laredo also has much of its near-term oil and gas production hedged. For 2015, the company has hedged some 90% of its expected output at a weighted average floor price near $81/bbl. But Laredo is also highly leveraged, with a debt/equity ratio above 100%. In 2013, Laredo's share price nearly doubled before pulling back and ending the year with a gain of almost 60%. Because I expected oil prices to fall in 2014, and because I am a risk-averse investor, I have avoided companies like Laredo this year -- understanding full well that I am sacrificing some upside. I did lose out on some upside when I was wrong about oil prices in the first half of 2014. The price of WTI remained above $100/bbl, and during the first half of the year Laredo rose a further 12%. But when oil prices did fall, Laredo's share price went into a tailspin, declining more than 40% between July 1 and mid-October. In fact, Laredo is now down 36% year-to-date, and has wiped out nearly all of last year's gains. This is where my aversion to risk protects me. I know I am giving up some of the upside should the market rally, but I don't worry a lot that my portfolio is going to drop 35% in a short time. Time to Get Greedy? However, when my expectation shifts to higher oil prices, I am not totally opposed to buying a company like Laredo -- especially given the recent sell-off. In fact, if I expected oil prices to firm soon, a stock like Laredo is exactly what I would buy now. For more than a year I have felt like the smaller oil producers were too richly valued for my investing style, but now they have been significantly de-risked. I may buy a stock like Laredo after the sort of steep correction the energy markets have recently seen. But then again, I am very patient with my investments. I would buy such a stock knowing that it could fall another 30%. Think "Black Monday" after the market had already made a significant downward move. I know that I may have to wait two to three years to see a significant return. Conclusions My style may not suit you, but over time it has paid off for me. The key to it is a long time horizon and patience. Don't panic when the market is panicking. But also be very cautious when opening a position in a stock trading at high multiples relative to its history or peers. In some cases paying up might be justified, but all too often you would be acting on your greed when fear would be more appropriate. This article originally appeared in the The Energy Letter column. Never miss an issue. Sign up to receive The Energy Letter by email. | | |
Whether you're building a nest egg for retirement or are already retired, you need income now. But it's tough finding high-quality, long-term income investments, what with interest rates scraping the bottom of the barrel. Here's good news…
I've discovered a new, secret weapon for pinpointing low-risk, high-income investments. It's like a secret blueprint for nabbing big dividends. How does a 10.32% dividend sound? That's just one of them – I have 4 more! Here's what you need to know to get in NOW.
| | | 10/22/2014 By Jim Fink 
Successful investing involves not only spotting the good companies that you should invest in. It also means being able to recognize the bad ones that can kill your portfolio's return. A company can be very well known with an established track record of success, but still lose its way. Hewlett-Packard (NYSE: HPQ) is a good example. Co-founders Bill Hewlett and Dave Packard, who formulated the wildly successful business concept known as The HP Way, are undoubtedly turning in their graves right now. The HP Way is based on a two-prong premise that a company should make a technical contribution to society while at the same time providing complete customer satisfaction. Profits are important, but should be the result of implementing the HP Way, not a focal starting point. The last HP CEO with an engineering degree was Lewis Platt, who ran the company from 1992 until 1999. Under his tutelage, the company reached the pinnacle of success in 1997. With the 1999 CEO appointment of AT&T marketing executive Carly Fiorina – a person with no technical background whatsoever – the HP Way was abandoned and the long slide and disintegration of HP began. Next up was HP Chairman Patricia Dunn who illegally spied against fellow HP board members and had criminal charges filed against her. This farce was followed by CEO Mark Hurd resigning after charges of expense report fraud and sexual harassment became public. The latest chapter in HP's slow death occurred when the company released its third-quarter earnings report. Earnings were fine, in-line with analyst estimates, but the real shocker was the company's announcement that it was seeking to divest its personal computer (PC) business, which is the largest in the world, and shutting down all development and manufacture of mobile devices (i.e., smartphones and tablets) based on the webOS operating system it bought from Palm in 2010 for $1.2 billion. Investors absolutely hated the news, sending the stock down more than 20%, its worst one-day loss since the stock market crash of October 1987. While it's true that co-founders Bill Hewlett and Dave Packard never were interested in commoditized products like PCs, the fact remains that once a company has become the world's largest of anything, it achieves competitive advantages of scale and scope that generate real value. For example, volume discounts on purchases of commodity computer hardware parts will be lost. One analyst estimates that HP's earnings will decline 5% after the PC divestiture because it will lose these purchasing economies of scale. Whoever buys the PC business won't be able to pay its full value to HP because the buyer won't have the economies of scale that HP did. Furthermore, HP was crazy to announce to the world that they wanted out of PCs before consummating a sale of the business because now potential PC customers will go on a buyer's strike, and look elsewhere for their PC needs to avoid potential service disruptions during the ownership transition. Consequently, sales of HP PCs are sure to drop precipitously, severely hurting the value of the business and ensuring that the sale price will be much lower than it otherwise would have been. Shutting down the webOS platform is equally mystifying. Sure, Apple's (NasdaqGS: AAPL) iOS and Google's (NasdaqGS: GOOG) Android are the market leaders in mobile operating systems, but Palm's webOS is really good and could have competed. As HP itself stated at the time of the Palm acquisition, webOS is "unparalleled" and "unique" and "will allow HP to take advantage of features such as true multitasking and always up-to-date information sharing across applications." This begs the question why HP did it? I must lay the blame on yet another HP CEO Leo Apotheker, another clueless CEO in the long line of bad HP CEOs since the end of the Platt era. Apotheker was appointed CEO in September 2010 after Hurd's resignation. He came to HP from German enterprise software company SAP AG (NYSE: SAP), where he was CEO for nine months before getting fired. In an interview, SAP Chairman Hasso Plattner said that Apotheker was fired because "large parts of the workforce were no longer confident that Leo Apotheker was the right man for the job." Apparently, he generated a dramatic "lack of trust." Some savvy analysts believe that Apotheker is selling off PCs and mobile devices, not because it is in HP's best interest, but because he comes from an enterprise software background and wants to transform the company into something he is familiar with. Apotheker has never shown any interest in the consumer market or hardware devices in general. Never mind that consumer hardware is an HP strength. Despite the fact that HP's stock is selling at a substantially lower price than it was a few months ago, I would be in no rush to buy it. Massive corporate restructurings and acquisition integrations take a long time to bear fruit, even in the best of situations. In contrast, HP's situation is one of the worst I have ever seen. This article originally appeared in the Small Cap All-Stars column. Never miss an issue. Sign up to receive Small Cap All-Stars by email. | | |
Yes, the stock market is having a banner year. But the simple truth is: It's overheated – especially dividend stocks. The first half of 2014 saw almost $30 billion in dividend increases alone. As a result, eager investors have plowed into these U.S. stocks and prices have skyrocketed. That's a problem. You could be overpaying by 60% on your next stock purchase.
But…amazing, cheap income opportunities still abound if you're willing to think globally. I have 5 income opportunities that are still available at bargain prices with big dividends…such as 10.05%, 10.10%, 10.32% and more. They're worth a look. Details here.
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