Costco Increases Dividend

Costco Wholesale (NASDAQ: COST  ) might be a bargain shopping destination, but the company is going to open its wallet a bit wider for its upcoming dividend. It's announced a new distribution of $0.31 per share of its common stock, which will be handed out on May 31 to shareholders of record as of May 17. That amount is nearly 13% higher than the firm's previous regular quarterly payout of $0.275 per share dispensed in February.

Prior to that, Costco paid $0.24 per share. It also distributed a special dividend of $7.00 in December.

The new payout annualizes to $1.24 per share. That yields 1.1% at Costco's current stock price of $108.43.

More Expert Advice from The Motley Fool

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George Soros Is Buying J.C. Penney Stock: Should You?

Big Tech Stocks Buck the Falling Markets

Will These Numbers from Silicon Graphics International Be Good Enough for You?

Silicon Graphics International (Nasdaq: SGI  ) is expected to report Q3 earnings on April 30. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Silicon Graphics International's revenues will grow 7.7% and EPS will expand 27.3%.

The average estimate for revenue is $214.7 million. On the bottom line, the average EPS estimate is $0.14.

Revenue details
Last quarter, Silicon Graphics International reported revenue of $171.2 million. GAAP reported sales were 12% lower than the prior-year quarter's $195.2 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $0.10. GAAP EPS were $0.03 for Q2 versus -$0.07 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 27.8%, 110 basis points better than the prior-year quarter. Operating margin was 0.0%, 100 basis points better than the prior-year quarter. Net margin was 0.6%, 180 basis points better than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $769.4 million. The average EPS estimate is $0.31.

Investor sentiment

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Silicon Graphics International is buy, with an average price target of $13.50.

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Investments for Busy People

Time Warner Stock Turns to Wal-Mart for a Superman Punch

Time Warner (NYSE: TWX  ) is hoping that an intriguing partnership with Wal-Mart (NYSE: WMT  ) will help increase awareness and ticket sales for June's theatrical release of Man of Steel.

Wal-Mart will be the exclusive seller for advance screenings at 2,379 theaters that will take place the night before the film's June 14 release. 

Time Warner will benefit by having Wal-Mart promote the film through its more than 3,700 stores. Time Warner should also get a boost months later when the Superman reboot hits the home video market. Wal-Mart ticket buyers will receive codes to preorder the Blu-ray, DVD, or digital download with exclusive additional content, and that's a move that should boost retail sales down the line.

Time Warner stock could use the boost. Yes, the shares hit an 11-year high last week, but the media giant's fundamentals could afford to be more Superman and less Clark Kent these days. Analysts see revenue growing at a mundane 4% clip this year and through 2014. A hit movie could move the needle.

Wal-Mart will naturally be a big winner, too. In this video, longtime Fool contributor Rick Munarriz goes over what both companies stand to gain in this win-win arrangement.

The Supermen of retail
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.

Don't Try to Pick the Best Biotech Company

Why Unions Want to Cut Retiree Pension Benefits

Underfunded pension plans represent one of the biggest potential financial problems facing the nation. Despite rising challenges over the past several years in meeting pension obligations, most pension plans have remained committed to making good on the promises they had already made to retired pensioners, following the federal law that protect retirees against benefit reductions.

Now, though, retiree pension benefits could be at risk for the first time in decades. As a recent Wall Street Journal report explained, unions and employers have gotten together to recommend changes to the nearly 40-year-old laws governing pension plans that cover workers from multiple employers. Those changes would make it possible for plans to reduce existing benefits paid to current retirees.

Us vs. them
The dilemma that pension plans face right now is a difficult one. Although many pension plans have been diligent in maintaining adequate funding levels to finance the promises they've made, an increasing number of plans are falling behind. With scores of pension plans on a path toward failing entirely, cutting pension benefits now could allow the plans to survive longer, benefiting current workers and relatively new retirees at the expense of older retirees.

Yet the policy behind protecting retirees is still as strong as ever. After you retire, you have almost no ability to replace lost income from declining pension payments from other sources. Conversely, current workers can still take steps to boost their personal savings to plan for an anticipated reduction in future pension benefits.

Indeed, most private companies have followed the strategy of protecting current pensioners while removing benefits from future workers. Over the past several years, IBM (NYSE: IBM  ) , Verizon (NYSE: VZ  ) , and countless other major employers have frozen existing pension plans, keeping them in place for employees that already earned benefits from them. New hires, however, were shunted into 401(k) plans and similar defined-contribution plans, which carry far less risk for the employer.

In addition, failing private companies have often relied on the federal Pension Benefits Guaranty Corporation to step in and protect their workers. In the past, US Airways (NYSE: LCC  ) and United Airlines, now merged into United Continental (NYSE: UAL  ) , have seen the PBGC take over certain pension-plan obligations to provide benefits to their workers as part of the airlines' respective bankruptcy proceedings. Under the PBGC, certain former workers whose benefits fall above a maximum benefit level have seen their payments cut, but many have gotten full restoration of their pensions.

The PBGC steps in to make payments to pensioners when pension plans fail. Source: PBGC.

Unfortunately, the PBGC has had financial problems of its own for years. The premiums the PBGC collects from employers haven't been sufficient to avoid a funding deficit of about $34 billion, and it anticipates rising rates of pension insolvencies to push that deficit much higher in the coming decade. As a result, lawmakers will be more receptive to union and employer proposals that could reduce any potential taxpayer bailout of the PBGC in the future.

Weighing the alternatives
Pension obligations have also become a big financial issue for public employees. The recent bankruptcy of the city of Stockton, Calif., has become a test case for whether federal bankruptcy law overrides California law's requirement for the funding of the California Public Employees Retirement System. Other municipal creditors wanted Stockton to reduce the amount that would go to CalPERS in its reorganization plan, and although a court-approved Stockton's plan in ruling that those creditors acted in bad faith by refusing to negotiate, the judge suggested that the amount of money going to CalPERS could be subject to negotiation as part of bankruptcy proceedings.

In the end, with public and private employers all struggling to make ends meet, the shrinking pool of funding for pension benefits means that some workers won't get the full amount they were expecting. The big question, though, is which workers will bear the brunt of the shortfall, and the joint union-employer proposal would put the benefits of all workers, both current and former, on the table.

Providing for your own retirement savings is a smart way to address pension uncertainty. 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.

Is AmerisourceBergen a Cash Machine?

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 AmerisourceBergen (NYSE: ABC  ) , 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, AmerisourceBergen generated $1,192.0 million cash while it booked net income of $559.0 million. That means it turned 1.5% of its revenue into FCF. That doesn't sound so great.

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 AmerisourceBergen look? Take a peek at the chart below, which flags questionable cash flow sources with a red bar.

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

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

With 31.1% of operating cash flow coming from questionable sources, AmerisourceBergen investors should take a closer look at the underlying numbers. Within the questionable cash flow figure plotted in the TTM period above, other operating activities (which can include deferred income taxes, pension charges, and other one-off items) provided the biggest boost, at 16.1% of cash flow from operations. Overall, the biggest drag on FCF came from capital expenditures, which consumed 13.7% 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.

Is AmerisourceBergen the best health care stock for you? Learn how to maximize your investment income and "Secure Your Future With 9 Rock-Solid Dividend Stocks," including one above-average health care logistics company. Click here for instant access to this free report.

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

Add AmerisourceBergen to My Watchlist.

Corning's Earnings And Dividend Increase: Why I'm Long

On Wednesday April 24th, Corning Inc. (GLW) announced a quarterly dividend increase of $0.01/share to bring its upcoming dividend payout to $0.10/share. It should be noted that this increase represents a 10% rise from its prior dividend of $0.09/share which was paid on January 30th. In the wake of Corning's dividend increase I wanted to examine several of the catalysts behind my decision to establish a long-term position in this particular stock.

Overview: Shares of GLW, which currently possess a market cap of $20.04 billion, a P/E ratio of 11.42, a forward P/E ratio of 10.42, and a PEG ratio of 0.95, settled at $13.88/share at the end of Wednesday's session.

(click to enlarge)

Recent Earnings: Along with the company's dividend announcement, Corning also reported Q1 results, which to most everyone's surprise were earnings of $0.30/share ($0.06/share better than street expectations) on slightly disappointing revenue of $1.8 billion (the Street was expecting $1.96 billion).

There are a few things within Wednesday's earnings announcement that strike me as very promising catalysts heading into Q2 and the remainder of the year. First let's begin with the company's Core Performance for the quarter. Comparative to Q1 2012, Core Net Sales were steady at $1.814 billion, Core Equity Earnings rose slightly to $180 million, Core Earnings rose 12% to $445 million and Core EPS rose 15% to $0.30/share.

Now let's move on to the company's GAAP Performance for the quarter, which, if you ask me, could use some improvement over the next 6-12 months. As a whole the company's performance was mixed as GAAP Net Sales and GAAP Equity Earnings demonstrated declines of 6% and 21%, respectively, while GAAP Net Income and EPS rose 6% and 4%, respectively.

What were some the factors contributing to Corning's performance? For starters, Corning's LCD unit! sales increased 7% on a year-over-year basis and contributed to 36% of the company's overall total and the unit's volume also rose by a "mid-teens" level according to an earlier Market Current. The company's telecom (optical fiber) sales fell 7%, but rose 10% in the fourth quarter and contributed 26% to the total sales of the company. Meanwhile the company's Specialty Materials (including its Gorilla Glass unit) and Environmental sales fell 10% and 13%, respectively. Lastly the company's Life Sciences segment saw sales rise impressively, which was due in large part to the company's recent M&A activity. One of the things I'd like to see in the second quarter is an improvement in the company's sales, especially in terms of its semiconductor and environmental businesses.

Dividend & Buyback Behavior: Since August 27 2007, GLW has increased its quarterly dividend a total of three times by an average of $0.0166 each time. From an income perspective, the company's forward yield of 3.00% coupled with its payout ratio (currently 27.00%) and its continued annual increases could equate into a very viable income option for long-term investors. It should also be noted that Corning announced its plans to buy back a total of $2 billion in stock by the end of the year.

GLW Dividend data by YCharts

Conclusion: When it comes to those who may be looking to establish a position in Corning, Inc., I'd continue keep a watchful eye, not only on the company's dividend behavior over the next 12 months, but any key developments with regard to the improvement of such segments as its Specialty Materials or Environmental units. If earnings continue to show strength throughout the remainder of the year and the company's revenues also improve, investors may also want to consider Corning from a growth perspective as well.

Disclosure: I am long GLW. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. (More...)

Juniper Networks Guidance at Low End of Expectations

Wireless network equipment maker Juniper Networks  (NYSE: JNPR  )  reported preliminary first-quarter earnings yesterday that came in below top-line consensus estimates by Capital IQ analysts, but issued guidance for the second quarter that was just able to meet expectations at its upper end.

Juniper reported revenues for the three months ending on March 31 will come in at $1.059 billion, up 3% from the same period last year but down 7% sequentially and below analysts expectations of $1.064 billion. The equipment maker recorded GAAP earnings of $0.18 per share, but adjusted profits of $0.24, which was 50% higher than the per-share adjusted profits it generated last year. Analysts had expected earnings of $0.13 per share.

Guidance for the second quarter 2013 ending June 30, however, was expected to be in a range of $1.07 billion to $1.1 billion, with the $1.085 billion mid-range number below the $1.108 billion expectations of analysts, though the upper end just meets them. On the bottom line, it anticipates non-GAAP earnings of $0.22 to $0.26 per share, with the mid-range of $0.24 ahead of Wall Street's $0.16-per-share estimates.

While acknowledging it expects to see continued weakness in enterprise customer spending, Juniper Networks CEO Kevin Johnson said:

We are seeing increased momentum with our new product offerings as we continue our strategy of innovating in the domain of high-performance networking. We believe Juniper has a strong position in the service provider market and has opportunity in the enterprise business as we continue to grow switching as well as revitalize our security business. We continue to focus on delivering great products, improving operational execution, and managing our costs carefully.

Juniper Networks delivers the software, silicon, and systems to enhance networking in devices and data centers at both the consumer and cloud provider level.

Why KLA-Tencor Shares Crashed

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: Shares of KLA-Tencor (NASDAQ: KLAC  ) are down today by about 8% after bottoming at a 10% loss in the morning. The market is not happy with the company's forward guidance, despite a decent earnings report for the fiscal third quarter.

So what: KLA's revenue of $729 million represented a 13% year-over-year decline, but still narrowly beat the $726.8 million consensus. Earnings per share of $1.01 were better, as that figure bested the $0.85 consensus by 19% on the upside. However, the company's upcoming quarter looks to be ugly -- KLA expects revenue in the $670 million to $730 million range, and EPS in the $0.66 to $0.86 range. Not only are these well below the current quarter's results, they also undershoot the Street's consensus figures of $763.2 million in revenue, and $0.97 in EPS.

Now what: This wasn't a pretty quarter, and guidance isn't pleasant, but KLA looks rather cheap at a 12.6 P/E with a 3% dividend yield after the drop. However, the guidance begs the question -- is this company simply becoming a value trap now? The stock has moved around a lot over the past year, but appears largely range-bound and, until today, KLA was near the top of its range. Without forward momentum, cheap won't matter. Investors need to see growth over the long term.

Want more news and updates? Add KLA-Tencor to your Watchlist now.

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For "Hemlock Grove," the Path to Success Is Easier Than You Might Think

Netflix's (NASDAQ: NFLX  ) new horror show Hemlock Grove, which makes its debut this weekend, has already come under fire from some reviewers. The negative press appears to be emboldening the bears ahead of the company's April 22 earnings report. They might be acting prematurely.

Look at history. HBO's comparable horror series, True Blood, captured just 1.4 million viewers in its September 2008 premiere before going on to five seasons of award-winning performances and excellent ratings for the Time Warner (NYSE: TWX  ) subsidiary. Season six begins on June 16.

Sources: HBO, Facebook.

All Hemlock Grove has to do is get close to these numbers with hardcore horror fans. Presuming the buzz that follows is enthusiastic enough to keep viewers engaged, Netflix could have a niche hit on its hands in the same way that True Blood has grown into a win for HBO. At the very least, you can bet Amazon.com (NASDAQ: AMZN  ) is paying close attention as it prepares to launch its own slate of self-produced programs.

Viewer ratings of Hemlock Grove look good so far. As of this writing, the 1,442 members rating the show at Netflix give it 3.9 out of five stars. The top-rated review speaks for how show-runner Eli Roth hopes to give viewers something different:

"To me, it's most important for this series to make the statement: 'If you want high school, lovey-lovey, blade martial arts, Oprah-channel-drama, than Hemlock Grove may not be for you.' ... I think it has succeeded in doing so."

Shareholders can only hope.

What's your take on Hemlock Grove? Will you watch? Please vote in the following poll and then leave a comment to let us know whether you'd buy, sell, or short Netflix stock now, and why.

For further analysis of how Netflix is changing entertainment, tune into our newest premium research report, in which we take you inside Netflix's entertainment empire and tell you what the streaming sensation is really worth, and whether the stock deserves a place in your portfolio. Access your report now by clicking here.

Twitter Is Aiming for Facebook's Crown

Social media sites inherently have a hard time staying on top for long because they're at the whim of very fickle users. Plus, the social landscape can change in the blink of an eye. A close competitor may overtake you like MySpace did to Friendster, or a site can be rendered obsolete by a "cooler" site -- remember how "uncool" MySpace was when Facebook (NASDAQ: FB  ) came around? With the ever-changing social media platforms, you never know when it's your turn to be a has-been, and Facebook may be next on the list.

In Facebook's case, people are becoming wary of useless updates, privacy concerns, and even boredom of the same old baby pictures and relationship updates every day. Facebook fatigue is starting to set in -- and teens are leading the charge.

Fear Facebook fatigue
Two new studies show that Facebook fatigue may be more reality than fantasy. A study by Pew Research found that 61% of respondents have taken an extended break from the site. The top four responses (shown below) are most telling.  

21%: Way too busy / Didn't have time for it 10%: Just wasn't interested / Just didn't like it 10%: Waste of time / Content was not relevant 9%: Too much drama/gossip/negativity/conflict

More concerning to Facebook is the site's falling importance among youth, who typically lead social media trends. A study of teens by Piper Jaffray earlier this year showed that Facebook was the most important social media network to 20% of respondents, down from 30% a year ago. As Facebook spills into older generations and friend requests from distant aunts and uncles pour in, the loss of appeal for teens is understandable.  

New products like Facebook Home only exacerbate Facebook overload, overwhelming users with all Facebook, all the time. Twitter is watching these trends closely -- the budding trend of finding social media useless -- and the site is positioning itself as an vital media platform in order to swoop in and take Facebook's crown.

Twitter's growing importance
Since Twitter was launched in March 2006, the site made its mark through its short blurbs and "tweets," allowing friends to share random thoughts and ordinary people to follow their favorite celebrities and news forums. Since then, Twitter has harvested its inspiration of real-life, 140-character thoughts and evolved this initial principal into a fundamental news hub.

During the Boston Marathon bombing and the resulting aftermath, it was Twitter that became a key source of news and updates for residents. The Boston Police Department used Twitter as the tool of choice to communicate up-to-date information after the bombing and eventually the manhunt that brought the city to a standstill. It was a tweet that simply said, "CAPTURED!!! The hunt is over. The search is done. The terror is over. And justice has won. Suspect in custody." That sent the city -- and country, for that matter -- into celebration.

Countless organizations from CNN to the Boston Globe to ESPN use Twitter to disseminate information before it ever hits TV or websites. It has its flaws, but this immediate information is what separates Twitter from Facebook and makes it a must-have for social media users.

Beyond 140 characters
In addition to Twitter's value distributing the written word, the site recently expanded its 140 character updates with video-sharing service Vine, which allows users to take short videos and post them to the site from within the Vine app. Vine launched on Jan. 24 of this year, and by April 9 it was the most downloaded free app on the App Store, adding millions of more users for Twitter.

Facebook should watch out
The combination of Twitter and Vine creates a formidable opponent to Facebook. Twitter has proved to be a useful tool for media, companies, and government officials to distribute information, which is attracting new users. Active Twitter users doubled to 200 million last year, outpacing 25% growth on Facebook. It still lags the 1.06 billion people using Facebook, but its faster pace of growth and increasing importance as a "news" source makes it likely to take the social media crown in the next few years.

If you're still not convinced -- just look at the importance Twitter had over the past week.

Time to dump Facebook shares?
After the world's most hyped IPO turned out to be a dud, most investors probably don't even want to think about shares of Facebook. But there are things every investor needs to know about this company. We've outlined them in our newest premium research report. There's a lot more to Facebook than meets the eye, so read up on whether there is anything to "like" about it today, and we'll tell you whether we think Facebook deserves a place in your portfolio. Access your report by clicking here.

Why Illumina Shares Soared

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: Shares of Illumina (NASDAQ: ILMN  ) , a life science diagnostics company, rallied as much as 15% after the company reported better-than-expected first-quarter earnings results.

So what: For the quarter, Illumina reported a 21% boost in revenues to $331 million with an adjusted profit of $0.46 per share. Wall Street had only expected Illumina to post a profit of $0.39 on just $310.7 million in sales. If there were one blemish to the quarter, it was that the company took a $106.9 million charge related to ongoing patent litigation with Syntrix Biosystems.

Now what: Having witnessed Thermo Fisher Scientific scoop up Life Technologies last week, the sector is still abuzz with optimism. While I don't think Illumina is going to be receiving any takeover bids, I'm very intrigued by the outlook for life science diagnostics companies in general with regard to helping personalize cancer care over the remainder of the decade. Illumina appears to be a bit pricey here, but it's certainly a name worth considering for the future.

Craving more input? Start by adding Illumina to your free and personalized watchlist so you can keep up on the latest news with the company.

While you can certainly make huge gains in life science companies like Illumina, 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.

The Investing Lessons of Minecraft

Minecraft is capturing attention like no game since Angry Birds, which even has its own "Star Wars" edition. Publisher Mojang recently announced the 10 millionth download of the PC version of the game via Twitter.

And that's just one sign of how huge this franchise has become. According to Digital Trends, Mojang had sold 15 million copies of Minecraft overall. The company booked $240 million in revenue last year.

An 8-bit departure from the likes of Sim City, which has caused trouble for Electronic Arts (NASDAQ: EA  ) in recent weeks, or Microsoft's (NASDAQ: MSFT  ) megahit Halo series, Minecraft is a throwback that includes the sorts of in-app purchasing features that fueled Zynga's (NASDAQ: ZNGA  ) earnings in years past.

Publishers should take heed, says Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova in the following video. While there will always be a market for complex titles that cater to hardcore fans, simple games that entice 7-year-olds as easily as 37-year-olds are capturing more of the market than ever before.

Do you play Minecraft? Have you made in-app purchases? Please watch this short video to get Tim's full take, and then leave a comment to let us know what you think of the game, and whether it can grow to become the next Angry Birds.

While Activision Blizzard and Microsoft have been taking the headlines when it comes to console gaming, Fools following the gaming sector would do well to also keep tabs on Electronic Arts. We can help. Our new special report breaks down the risks and opportunities facing the company to help you decide if EA is right for your portfolio. Click here to get your copy now.

Why Edwards Lifesciences Shares Got Crushed

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: Shares of Edwards Lifesciences (NYSE: EW  ) plummeted 22% today after the heart valve maker's quarterly results and outlook missed Wall Street expectations.

So what: Edwards' first quarter results -- adjusted EPS of $0.72 on revenue of $496.7 million versus the consensus of $0.76 and $519 million, respectively -- and downbeat guidance for the full year reinforce recent concerns over slowing growth going forward. Specifically, sales of the company's new Sapien heart valves just aren't growing as quickly as the stock's seemingly lofty P/E requires, forcing analysts to recalibrate their expectations yet again.

Now what: Management now sees full-year adjusted EPS of $3.00-$3.10 on sales of $2 billion-$2.1 billion, below Wall Street's view of $3.27 and $2.14 billion, respectively.

"We remain committed to our high level of investment in our pipeline of new products ... and now project R&D to be 16 percent of sales in 2013," said Chairman and CEO Michael Mussallem. "We believe this enables us to aggressively develop our innovative product lines, driving long term growth and extending our leadership position in structural heart therapies and critical care technologies." More important, with the stock hitting a new 52-week low today and trading at a forward P/E in the mid-teens, the valuation might finally be low enough to gain from that progress.

While you can certainly make huge gains in medical device companies like Edwards, 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.

Interested in more info on Edwards? Add it to your watchlist. 

Why Cadillac Is Key to GM's Profits

General Motors (NYSE: GM  ) sold more vehicles than any company other than Toyota (NYSE: TM  ) in 2012, but its profits lagged those of many rivals. One reason: GM lacks a global luxury brand. In this video, Fool.com contributor John Rosevear looks at GM CEO Dan Akerson's big plans for Cadillac -- and why that's important for GM's pursuit of stronger profits.

Does GM really have growth potential?
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Is British American Tobacco an Exciting Emerging Market Play?

Why Universal Display Is Poised to Bounce Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, organic light-emitting diode manufacturer Universal Display (NASDAQ: PANL  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Universal Display and see what CAPS investors are saying about the stock right now.

Universal Display facts

Headquarters (founded)	Ewing, N.J. (1985)
Market Cap	$1.4 billion
Industry	Electronic components
Trailing-12-Month Revenue	$83.2 million
Management	CEO Steven Abramson (since 2008) CFO Sidney Rosenblatt (since 1995)
Return on Equity (average, past 3 years)	(9.9%)
Cash/Debt	$243.9 million / $0
Competitors	BASF Eastman Kodak Sumitomo Chemical

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 95% of the 1,295 members who have rated Universal Display believe the stock will outperform the S&P 500 going forward.

Just yesterday, fellow Fool Simon Erickson (TMFInnovator) summed up the Universal Display bull case for our community:

Over 1000 issued and pending patents on OLED technology. They have the know-how in this fast-growing industry. OLEDs shine brighter and are more energy efficient than current lighting technology. They're a better mousetrap.

- HUGE opportunity if OLED's catch on in televisions. DisplaySearch research estimates the OLED TV market to reach $16 billion of revenue by 2020.

- Extremely high profit margins, and revenues have doubled in each of the past two years.

Smartphone displays for Samsung have given them a good foothold and reputation in the industry. Adoption of OLED TV's will no-doubt be the long-term driver of growth. And the wildcard is if Apple adopts OLEDs for the iPod. ... That development would blow the roof off.

Many are impatient with the long-term story, as OLEDs always seem to be "around the corner". But I like the risk/reward trade-off.

If you want market-thumping returns, you need to put together the best portfolio you can. Of course, despite a strong four-star rating, Universal Display may not be your top choice.

We've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2013." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

"Oblivion" Smashes the Competition to Top Weekend Box Office

The summer movie season is almost here, and one science-fiction action blockbuster shined this past weekend. The Tom Cruise-led film Oblivion, distributed by Comcast (NASDAQ: CMCSA  ) subsidiary Universal, took the top spot at the domestic box office this weekend, racking up more than $38 million in U.S. sales in its debut weekend.

Oblivion also topped the worldwide box office over the weekend, recording nearly $72 million in sales across the globe, according to media measurement firm Rentrak.

Oblivion, which was released internationally a week ago, has now pulled in more than $150 million around the world to eclipse its estimated $120 million budget. It easily outpaced the domestic box office's No. 2 film for the weekend, the Jackie Robinson-inspired biographical film 42, distributed by Time Warner (NYSE: TWX  ) subsidiary Warner Brothers. 42, in its second weekend, picked up just over $18 million in sales in the U.S. this weekend, bringing its box office run to over $50 million. It has no international sales.

Action film GI Joe: Retaliation and animated feature The Croods continued to perform well, pulling in nearly $46 million and $33 million, respectively, at the worldwide box office this past weekend. The Croods, distributed by News Corp. (NASDAQ: NWS  ) subsidiary 20th Century Fox, has now eclipsed the $400 million sales mark at the box office. GI Joe: Retaliation has notched nearly $323 million.

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Bank of America Stock Could Still Make You Rich

After the impressive performance of Bank of America's (NYSE: BAC  ) stock last year -- it was the top-performing component of the Dow Jones Industrial Average (DJINDICES: ^DJI  ) -- it'd be tempting to conclude that the nation's second-largest lender didn't have much juice left in the proverbial tank. But according to a number of high-profile analysts, that simply isn't the case.

Roughly halfway through today's trading session, shares of Bank of America are higher by nearly 1.5%. This comes, moreover, on the heels of an impressive performance yesterday, when its shares were up by 1.3%.

There's no question that a growing number of analysts are becoming bullish on Bank of America stock. In the middle of last month, Meredith Whitney -- who famously foretold Citigroup's fall five years ago -- reiterated her view that Bank of America was one of the most undervalued bank stocks in the market. "Very rarely do these big banks have both value catalysts and momentum," Whitney noted. "Bank of America had all of that."

Since making her original call at the end of last year, Whitney's opinion has been vindicated, as the Charlotte, N.C.-based lender's shares are up roughly 15%.

How much further could they go?

For a moment last week, it appeared as if the Bank of America bandwagon may have gotten derailed (excuse the mixed metaphors). After reporting first-quarter earnings on April 17, its stock plunged by upwards of 7% over the next two days. Investors were clearly discontented that the bank missed analyst estimates for earnings per share by $0.02 -- coming in at $0.20 per share vs. an expected $0.22.

But since then, the market has warmed up to the results -- and particularly the bank's announcement that it settled three massive class action lawsuits dating back to the financial crisis. With today's gains, Bank of America stock is getting back within striking distance of its 52-week high. And if Whitney's predictions hold true, it could be headed to $15 in the near term and $20 long term.

Want to learn more about Bank of America stock?
Bank of America's stock doubled in 2012. Is there more yet to come? With significant challenges still ahead, it's critical to have a solid understanding of this megabank before adding it to your portfolio. In The Motley Fool's premium research report on B of A, analysts Anand Chokkavelu, CFA, and Matt Koppenheffer, Financials bureau chief, lift the veil on the bank's operations, including detailing three reasons to buy and three reasons to sell. Click here now to claim your copy.

IMAX First-Quarter Results Fall Short of Estimates

IMAX (NYSE: IMAX  ) reported results for the first quarter of fiscal year 2013. Non-GAAP earnings fell 9% year over year to $0.08 per share. Sales came in 10.3% lower, at $49.9 million. Analysts had expected adjusted earnings of $0.09 per share on $54.1 million in revenue.

The big-screen ciena technologist installed six full-theater systems, and four joint revenue-sharing venues in this quarter, compared to eight full and eight joint installations in the year-ago period. The backlog of system orders increased from 261, to 283. Production and remastering revenue rose 4.3%. Box office from remastered titles was stable year over year, but average box office per screen fell by 14%.

"We are excited about the promising upcoming lineup of films in IMAX, particularly in the second quarter," said IMAX CEO Richard Gelfond. The second quarter includes high-profile IMAX releases such as Star Trek: Into Darkness, the next Iron Man sequel, and Superman reboot Man of Steel.

Gelfond also underscored steady growth in international markets. "We are very pleased that we continue to penetrate different countries around the world, strengthening our presence in some and building strong theaters in new markets to catalyze future growth in others," he said.

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.

U.S. Mint Suspends Some Gold Coin Sales After Demand Surge

Lloyds Banking Group to Float TSB Bank

LONDON -- The shares of Lloyds Banking  (LSE: LLOY  ) (NYSE: LYG  )  climbed 1 pece to 52 pence during early London trade this morning after the group said it would rebrand 632 branches as TSB Bank and float the division on the stock market.

The move comes after the Co-operative confirmed it had pulled out of a deal to buy the branches.

Lloyds announced in July last year that the Co-op had agreed non-binding terms to acquire the branches and their 4.8 million customer accounts for 750 million pounds.

The deal, known as Project Verde, had been expected to complete by November and would have taken the Co-op's estate to about 1,000 branches to represent around 10% of the U.K.'s banking network.

The European Commission had instructed Lloyds to sell the branches as part of the state bail-out the bank received during 2009.

Peter Marks, the Co-op's chief executive, said this morning:

Against the backdrop of the current economic environment, the worsened outlook for economic growth and the increasing regulatory requirements on the financial services sector in general, the Verde transaction would not currently deliver a suitable return for our members within a reasonable timeframe and with an acceptable level of risk.

Antonio Horta-Osorio, the chief Executive of Lloyds, responded:

We are well advanced in our plans to bring the Verde business to the UK High Street during the summer through the TSB Bank, and will now proceed with the option to IPO the business, subject to the necessary approvals.

The TSB Bank will be an attractive retail and commercial bank that will have around 630 branches across the UK, a strong management team and will be a real challenger on the high street.

Lloyds said an update on the timing of the flotation of TSB Bank would be given in due course. The bank also confirmed there would be no "direct impacts" to customers as a result of the Co-op deal being called off or the upcoming flotation.

Of course, whether the flotation of TSB Bank and the wider prospects for the banking sector currently combine to make Lloyds a buy is something only you can decide.

But if you already own Lloyds shares and are looking for alternative buying opportunities, this exclusive wealth report reviews five particularly attractive possibilities.

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Why Caterpillar Is Ready to Crawl Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, heavy equipment giant Caterpillar (NYSE: CAT  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Caterpillar and see what CAPS investors are saying about the stock right now.

Caterpillar facts

Headquarters (founded)	Peoria, Ill. (1925)
Market Cap	$55.1 billion
Industry	Construction and farm machinery
Trailing-12-Month Revenue	$63.1 billion
Management	Chairman/CEO Douglas Oberhelman CFO Bradley Halverson
Return on Equity (average, past 3 years)	33.4%
Cash/Debt	$6.0 billion / $36.2 billion
Dividend Yield	2.6%
Competitors	CNH Global Deere Terex

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 94% of the 6,088 members who have rated Caterpillar believe the stock will outperform the S&P 500 going forward.

Just yesterday, one of those Fools, Googlespooch, succinctly summed up the bull case for our community:

Caterpillar simply is the best at what it does: making heavy earth-moving machinery. This fact has helped to keep Caterpillar the industry titan in a complex, cyclical business. Caterpillar's strong financial standing and opportunities in China all seem to point to the company as a safe bet. In addition, at this current price, they seem undervalued which helps reduce downside risk. They also have a nice dividend yield of 2.6% which should help to reduce short pressure. Even though they have had some earnings weakness lately, I believe that they can bounce back in the coming quarters and years.

Caterpillar is the market share leader in an industry in which size matters, and its quality products, extensive service network, and unparalleled brand strength combine to give it solid competitive advantages. Read all about Caterpillar's strengths and weaknesses in The Motley Fool's brand-new report. Just click here to access it now.

Why Pepsi's a Better Buy Than Coke

Shares of soda and snack giant PepsiCo (NYSE: PEP  ) soared after the company announced earnings this morning. The stock is up 3.1% as of 2:30 p.m. EDT. But even with Pepsi having fared well relative to what Wall Street's finest expected to see, the big question remains: Will Pepsi ever pass rival Coca-Cola (NYSE: KO  ) to become the giant of the industry?

The results behind Pepsi's pop
At first glance, Pepsi's earnings results didn't look too exciting, as net income fell by more than $50 million compared with the year-ago quarter. But much of the earnings damage came from a one-time hit due to Venezuela's decision to devalue its currency; excluding other unusual items like restructuring charges, adjusted earnings rose 12%, topping expectations by a wide margin. Sales rose by about 1%.

But the real advantage that Pepsi has over Coke is its product diversification, which really showed in the report. The PepsiCo Americas Foods division saw strong 6% organic revenue growth, with its North American and Latin American divisions both contributing to rising sales. Frito-Lay's U.S. market share also climbed despite increasingly strong competition.

Moreover, Pepsi's emerging-market performance underscored how important the international markets are for the company. Adjusting for the impact of corporate structural changes, revenue in its fast-growing Asia, Middle East, and Africa segment rose 15%, with strength on both the snack side and the beverage side of the business. Even struggling Europe posted some impressive gains in sales and profits.

Source: Pepsi by john kovacich.

The troubles at home
Unfortunately, the U.S. beverage market continues to be a drag on the company. The PepsiCo Americas Beverage unit suffered volume and net revenue declines, which is consistent with what we've seen from Coke. In particular, cola has been a challenging product for the entire industry as consumers gravitate more toward water, tea, and sports-performance drinks.

Nevertheless, Pepsi has seen good results from its increased marketing. The challenge the company faces is figuring out how to allocate limited marketing resources, because the last thing it wants to do is to cannibalize its own business in pushing too many different products within the same market. Moreover, with different products offering varying levels of profit margin, Pepsi has to maximize profit at the same time it tries to meet the demands of its customers.

The smarter buy
Both Pepsi and Coke sport extremely high share valuations right now, especially given their U.S. growth woes. But Pepsi's exploitation of its distribution network to deliver its wider variety of beverages and snack foods -- largely to the same retail customers -- is more efficient than simply focusing on one set of products. With so many different ways of appealing to billions of customers around the world, Pepsi has the better growth potential, and in my eyes, that makes PepsiCo a smarter investment.

Learn more about how Pepsi can take on the world in The Motley Fool's new premium report on the company. Inside, our top analysts will guide you through everything you need to know about PepsiCo, including the key opportunities and threats in the company's future. Simply click here now to claim your copy today.

Brewers-to-Be: Beware

The craft brewing industry saw 15% volume growth in 2012, while the big guys -- led by Anheuser-Busch InBev (NYSE: BUD  ) , SABMiller, and Molson Coors (NYSE: TAP  ) -- are watching their megabrands lose market share.

This intoxicating craft growth is attracting new players in record numbers. While most don't see a beer bubble forming, brewers-to-be need to be careful. At the recent Craft Brewers Conference in Washington, D.C., Motley Fool analyst Rex Moore asked some established players what advice they have for newcomers. Today in this multipart series, we hear from Bill Butcher, founder of Port City Brewery in Alexandria, Va.

The biggest of the smalls
Boston Beer's Samuel Adams brand helped to redefine beer and kick off the craft beer revolution in the United States. Success breeds competition, though, and while just a few years ago Boston Beer had claim over most of the craft beer shelf, today the field is crowded. Can Boston Beer rise above the rest, or will it be squeezed between small local breweries on one side and global beer giants on the other? To help you decide, we've compiled a premium research report filled with everything you need to know about Boston Beer's risks and opportunities. Just click here now to find out whether Boston Beer is a buy today.

Is Tesla Motors a Risky Stock?

The Keys to Honeywell's Earnings

On Friday, Honeywell (NYSE: HON  ) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Honeywell does business in everything from helicopters to brake pads, with its fingers on the pulse of the industrial heartbeat of the global economy. That leaves the company potentially vulnerable to adverse macroeconomic trends, as we've seen recently from emerging-market slowdowns in China and recessionary conditions in Europe. Let's take an early look at what's been happening with Honeywell over the past quarter and what we're likely to see in its quarterly report.

Stats on Honeywell

Analyst EPS Estimate	$1.14
Change From Year-Ago EPS	9.6%
Revenue Estimate	$9.44 billion
Change From Year-Ago Revenue	1.5%
Earnings Beats in Past 4 Quarters	4

Source: Yahoo! Finance.

How will Honeywell find new profits this quarter?
Analysts have gotten slightly more optimistic about Honeywell's prospects over the past few months, raising their earnings calls on the just-finished quarter by a penny per share and adding $0.02 to their earnings-per-share calls for the full 2013 year. The stock has also done reasonably well, rising about 10% since early January.

Honeywell is a much more broadly diversified company than many investors give it credit for, with its automation and control systems business earning the most revenue of its four main divisions. As part of a coalition with companies including Emerson Electric (NYSE: EMR  ) , Praxair, and General Dynamics, Honeywell will participate on a $10 million contract from the Department of Energy to further clean-energy manufacturing. That contract is obviously small, but the prospects of clean-energy industry are much larger, and the project should help Honeywell gain valuable expertise in the area that it can put to more profitable use going forward.

But as Honeywell's most profitable segment, the aerospace industry still holds the most promise for the conglomerate, with strong prospects on multiple fronts. On one hand, as a supplier, Honeywell benefits from the trillions of dollars in revenue that Boeing (NYSE: BA  ) expects to see from new commercial aircraft orders in the next 20 years. Moreover, Honeywell expects strong helicopter sales throughout the world, with Latin America leading the way with a projected 34% increase in sales volume. The company has recently reaped further rewards from its presence in Latin America, as Embraer (NYSE: ERJ  ) awarded Honeywell a $2.8 billion contract to provide avionics for the next-generation E-Jet line.

To some extent, Honeywell is vulnerable to defense-related budget cuts. Yet the company has done a better job than many companies that receive defense contracts in broadening its revenue base well beyond government funding sources.

In Honeywell's report, one area to focus on is how the company's relationship with Textron's (NYSE: TXT  ) Cessna division is progressing. By diversifying beyond Boeing, Honeywell has the greatest chance to ensure its future regardless of which aircraft manufacturers perform the best.

Still, Honeywell will continue to rely on Boeing for a big chunk of its business. That raises the question of whether Boeing will live up to its potential. In our premium research report on Boeing, two of The Motley Fool's best minds on industrials have collaborated to provide investors with the key, must-know issues surrounding the aerospace giant. They'll be updating the report as key news hits, so don't miss out – simply click here now to claim your copy today.

Click here to add Honeywell to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

It's Showtime for Zix

Zix (Nasdaq: ZIXI  ) is expected to report Q1 earnings on April 23. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Zix's revenues will expand 15.0% and EPS will wither 0.0%.

The average estimate for revenue is $11.8 million. On the bottom line, the average EPS estimate is $0.04.

Revenue details
Last quarter, Zix reported revenue of $11.7 million. GAAP reported sales were 18% higher than the prior-year quarter's $9.9 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $0.05. GAAP EPS of $0.06 for Q4 were 74% lower than the prior-year quarter's $0.23 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 82.4%, 110 basis points better than the prior-year quarter. Operating margin was 27.7%, 200 basis points worse than the prior-year quarter. Net margin was 34.1%, much worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $49.7 million. The average EPS estimate is $0.20.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 546 members out of 782 rating the stock outperform, and 236 members rating it underperform. Among 64 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 62 give Zix a green thumbs-up, and two give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Zix is buy, with an average price target of $4.58.

Internet software and services are being consumed in radically different ways, on new and increasingly mobile devices. Is Zix on the right side of the revolution? Check out the changing landscape and meet the company that Motley Fool analysts expect to lead "The Next Trillion-dollar Revolution." Click here for instant access to this free report.

Add Zix to My Watchlist.

How DuPont's Earnings Will Look Tomorrow

On Tuesday, DuPont (NYSE: DD  ) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever surprises inevitably arise. That way, you'll be less likely to have an uninformed, knee-jerk reaction that turns out to be exactly the wrong move.

As the chemical-industry representative in the Dow Jones Industrials (DJINDICES: ^DJI  ) , DuPont makes a wide variety of products for businesses including agriculture, electronics, plastics, and pharmaceuticals. But given the overall global economic weakness, can the company keep producing the results investors want to see? Let's take an early look at what's been happening with DuPont over the past quarter and what we're likely to see in its quarterly report.

Stats on DuPont

Analyst EPS Estimate	$1.52
Change From Year-Ago EPS	0.7%
Revenue Estimate	$10.41 billion
Change From Year-Ago Revenue	(7.3%)
Earnings Beats in Past 4 Quarters	1

Source: Yahoo! Finance.

Will DuPont ramp up earnings this quarter?
Analysts have had mixed feelings about DuPont's earnings in recent months. They've cut their consensus estimates on earnings for the just-ended quarter by $0.04 per share, but they've boosted their full-year 2013 earnings-per-share figures by a nickel. The stock has responded with modest optimism, rising about 7% since mid-January.

DuPont has increasingly focused on the lucrative agriculture and farm products arena. With a variety of engineered seeds, fertilizers, and herbicides, DuPont has pushed forward in developing technology to help protect crops from threats like disease and changing weather conditions, such as last year's drought. The company has seen strong growth in the ag segment, and it expects double-digit sales growth in agriculture through 2013.

As part of its refocusing, DuPont made a big move to streamline its business during the quarter, finally closing on its $4.9 billion deal to sell its car paint division to private-equity firm Carlyle Group (NASDAQ: CG  ) . Carlyle arguably got a good deal, given the relatively low price, and it has a opportunity to whip the division back into shape. But the move should help DuPont improve its margins and reduce its exposure to Europe, whose economic woes have been holding the company back recently.

Another important move DuPont made recently was settling a lawsuit with rival Monsanto (NYSE: MON  ) , with DuPont agreeing to pay more than $1.75 billion over the next 10 years in order to secure licensing rights for various products. In exchange, the two competitors agreed to dismiss their respective claims against each other, resolving what could have been a long and ugly dispute.

In DuPont's report, be sure to watch closely at where the company is seeing the best growth prospects. If core businesses like its titanium dioxide production start to pick up in light of the housing recovery, then DuPont may move back from its ag focus to become more of a conglomerate again.

If you're looking for some long-term investing ideas, you're invited to check out The Motley Fool's brand-new special report "The 3 Dow Stocks Dividend Investors Need." It's absolutely free, so simply click here now and get your copy today.

Click here to add DuPont to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Sprint's Latest Unexpected Twist

What Caused the Dow to Drop Today?

Earnings and expectations are ruling Wall Street this week. As we move deeper into earnings season, investors are focusing more on actual results, and it's becoming very clear that those earnings are driving the markets, not the hot news story of the day. And regardless of whether the market moves up or down for the day, it is very refreshing to see this happen.

But what is still disconcerting is that although earnings and, in some cases revenues, are climbing, shares prices are dropping simply because analysts expected better results than what is being reported. This is preciously what happened today. Bank of America (NYSE: BAC  ) released first-quarter earnings, and profit quadrupled to $0.20 per share, but Wall Street expected $0.22 per share and the stock fell 4.72% during the day, and with the help of another 25 components, managed to pull the Dow Jones Industrial Average (DJINDICES: ^DJI  ) lower by 138 points, or 0.94%, during the day.

More Dow losers
Shares of Alcoa (NYSE: AA  ) were on the losers' side again, after the stock fell 1.73% today. Alcoa is already down 8.29% since the start of 2013 after falling 5.9% in 2012 and 43.7% in 2011. You have to go back to 2008 to find a full year when Alcoa's stock rose higher. The company faces a number of heads in the future, increased competition from smaller local producers also in China, which is likely the cause for the oversupply in the country, and when supply outpaces demand, aluminum prices decline. To learn the three reasons my Foolish colleague Taylor Muckerman believes you should sell Alcoa, click here.

As investors prepare themselves for Verizon's (NYSE: VZ  ) earnings report, set to be released tomorrow, shares dropped 1.82% today. Analysts expect the company to report earnings of $0.66 per share. Based on today's drop, it would seem investors felt that may be too high and are selling ahead of tomorrow's announcement.  

Another big loser today, on very little news, was Travelers (NYSE: TRV  ) , which lost 1.71% of its value. The insurance provider was likely pulled lower along with the other financial related stocks due to the earnings report release from Bank of America, in which the company missed analysts' expectations on per-share earnings. A number of the financial institutions that hardly relate to B of A's operations, or even those that do such as JPMorgan Chase but have recently announced their own results, were pulled lower by the whirlpool effect that Bank of America caused this morning. To read more about what happened to B of A and JPMorgan today, click here.

More Foolish insight

Bank of America's stock doubled in 2012. Is there more yet to come? With significant challenges still ahead, it's critical to have a solid understanding of this megabank before adding it to your portfolio. In The Motley Fool's premium research report on B of A, analysts Anand Chokkavelu, CFA, and Matt Koppenheffer, Financials bureau chief, lift the veil on the bank's operations, including detailing three reasons to buy and three reasons to sell. Click here now to claim your copy.

Bill Barrett Corp. Names New CEO

Denver.-based Bill Barrett Corp. (NYSE: BBG  ) is under new management. The oil and gas developer announced Wednesday that it has confirmed interim Chief Executive Officer R. Scot Woodall as its new permanent president and CEO. The appointment took effect Tuesday.

Woodall, 51, has worked for Barrett since 2007, joining the firm as executive vice president and senior vice president of operations before being promoted to chief operating officer in 2010. He had been serving as interim CEO since prior CEO Fred Barrett's resignation in January.

Woodall "has significant industry experience and his commitment to operational excellence should deliver shareholder value as we develop our core positions in the DJ Basin and Uinta Oil Program," Chairman of the Baord Jim Mogg is quoted as saying. Woodall said he would work to "maintain a work environment that highly emphasizes the safety of our employees and environmental stewardship in all the communities in which we operate."

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An Early Look at Panera's Earnings

On Tuesday, Panera Bread (NASDAQ: PNRA  ) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Panera has benefited greatly from the trend toward healthier eating, with its corporate philosophy encouraging customers to treat its restaurants like a home away from home. So far, that strategy has produced impressive growth. Let's take an early look at what's been happening with Panera over the past quarter and what we're likely to see in its quarterly report.

Stats on Panera

Analyst EPS Estimate	$1.65
Change From Year-Ago EPS	17.9%
Revenue Estimate	$566.1 million
Change From Year-Ago Revenue	13.5%
Earnings Beats in Past 4 Quarters	4

Source: Yahoo! Finance.

Will Panera's earnings stay healthy this quarter?
Analysts in recent months have become slightly more optimistic about Panera's earnings prospects. They've raised their estimates for the just-ended quarter by $0.02 per share and ratcheted up their 2013 full-year consensus by twice that amount. The stock has done reasonably well, rising about 10% since mid-January.

Panera has thrived by selling healthy fare in an inviting bakery setting. Not content to allow Starbucks (NASDAQ: SBUX  ) to dominate the early morning coffee niche, Panera has used some of the same tactics as its rival, building out its restaurants to encourage customers to linger with Wi-Fi and comfortable furnishings. Starbucks has reupped its efforts to go beyond coffee with its purchase last year of bakery company La Boulange, but that hasn't stopped Panera from posting strong growth.

One way that Panera has successfully gone beyond its coffee rival is in offering catering services. The company saw its catering sales rise 19% last quarter, and Panera expects to continue to expand in the area as customers get familiar with its availability and convenience. Fellow healthy-eatery Chipotle (NYSE: CMG  ) announced at the beginning of the year that it would follow suit with its own catering service, seeking to keep up with its competitor's faster growth rate.

Panera has also sought to gain favor not just with customers and investors but with the communities it serves as well. With initiatives to help the hungry, like donating baked goods to community organizations and its "pay-what-you-can" experiment with certain specialty stores scattered around the country, Panera has built a strong reputation for doing good as well.

In Panera's quarterly report, look at Panera's sales and earnings growth not just compared with the company's previous results but also in comparison with the figures Chipotle just released last week. If Panera can keep staying ahead of its competitors, it should have a strong future ahead of it.

For Panera, there's reason to believe that the best is still yet to come. The stock has been on an absolute tear over the past five years, and you're invited to find out why -- and what else there is to look forward to -- in The Motley Fool's brand-new premium report on Panera. Included are key areas that investors must watch, as well as opportunities and threats facing the company both today and in the long term. Don't miss out on this invaluable investor's resource -- simply click here now to claim your copy today.

Click here to add Panera to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

How Rosetta Stone Is Changing People's Lives

The following video excerpt was taken from an interview with Steve Swad, CEO of Rosetta Stone (NYSE: RST  ) , in which he talks about his business philosophy and how it is driving success both for language learners and for the company itself. In this segment, he discusses how his products are helping people learn through technology.

The Motley Fool's chief investment officer has selected his No. 1 stock for the next 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.

 

Matt Argersinger: So you mentioned technical expertise. When a lot of people think of Rosetta Stone, they think of education, which is obviously what you guys are doing, but you guys are really a technology company in a lot of ways, and so I am wondering if you could talk about that and also kind of what's going on in Boulder, Colorado.

Steve Swad: Boulder's sweet, notwithstanding the beautiful office we have. I actually find it to be the best place in our company to work. But back up, on the company, I think of the company with three pillars and the core, and you mentioned it, is learning. We're a company about learning. We succeed if our customers learn; we fail if our customers don't learn. We enable that learning through technology and so we use technology to bring learning to life, and the reason we do it is lifestyle, to change people's lives. So pillar one, learning; pillar two, technology; pillar three, change people's lives.

That's our company. That's our company yesterday. That's our company today. That'll be our company tomorrow. Boulder is part of that technology pillar, and it has invented speech recognition software that enables the learning. It's really critical software. Think about a tutor that is one-on-one and measures you by the minute. That's what our speech recognition software does in language.

So you say, "hola." The speech recognition software listens to you, grades you, and gives you feedback. If you pass, we give you a green signal. If you fail, we repeat the words: "hola." You listen and then you try it again. And that's all designed out of Boulder. They're wonderful people and it's wonderful technology.

FTC Cracks Down on Cell Phone Bill 'Cramming' Scam

A six-pack with 'unusual promise'

Finding fresh stock selections is no easy task in a market that's been rallying for three months. Investors eventually tend to overbuy when stocks are rising — and oversell when the market heads down.

Today, the pickings have proved thin as we screen hundreds of stocks for superior growth potential at reasonable prices. That said, we've still found stocks with unusual promise. Here's an overview of 6 of our new buys.

Alexion Pharmaceutical (ALXN)

This is a comeback stock that was previously a big winner of of ours but tumbled from $115 to $90 last fall. Now it is breaking back above its 10-week moving average with 33% a year expect- ed earnings growth and Strong Buy ratings from 14 of the 19 analysts covering it.

Allegiant Travel (ALGT)

Serving small-city U.S. travel destinations with planes and travel services, ALGT shares have been on the rise from $40 to $90 over the past 18 months, yet trade at just 14 times earnings that are estimated to grow 22% a year. Its PEG ratio is 0.62.

CVS Caremark (CVS)

A giant pharmacy healthcare provider whose shares have doubled almost non-stop since August 2010, CVS trades at 12 times forward earnings that are growing at a moderate but steady 14% a year.

D.R. Horton (DHI) and Ryland Group (RYL)

Homebuilding stocks came back last fall and winter only to tumble anew in March. The nascent upturn in housing has not yet reached their bottom lines, but some analysts' five-year earnings projections run as high as 30% to 40% a year. Yet their P/E and PEG valuations are quite modest in view of their long-run potential.

Radian Group (RDN)

his small-cap provides mortgage insurance and financial guaranty services to mortgage lenders. The stock has run from 7 to 10-plus, but if it breaks upside resistance at 10.95 RDN could go to 14 or higher. At just 7 its P/E could be upgraded.

The Television in 2015: 3 Bold Predictions

The media market is in the middle of a revolution -- no, make that several revolutions.

The living room gear that starts to make a market impact in 2015 will make today's high-def screens as quaintly obsolete as a black and white tube. All that delicious new hardware requires a new breed of content, and perhaps the biggest surprise of all is who you won't see tapping into these new opportunities.

In this video, Fool analyst Anders Bylund presents three unstoppable trends in living room entertainment that will hit home by 2015.

The tumultuous performance of Netflix shares since the summer of 2011 has caused headaches for many devoted shareholders. While the company's first-mover status is often viewed as a competitive advantage, the opportunities in streaming media have brought some new, deep-pocketed rivals looking for their piece of a growing pie. Can Netflix fend off this burgeoning competition, and will its international growth aspirations really pay off? These are must-know issues for investors, which is why The Motley Fool has released a premium report on Netflix. Inside, you'll learn about the key opportunities and risks facing the company, as well as reasons to buy or sell the stock. The report includes a full year of updates to cover critical new developments, so make sure to click here and claim a copy today.

What's the Opportunity Facing SandRidge Investors Today?

In this video, Motley Fool energy analyst Joel South describes the opportunities that SandRidge Energy (NYSE: SD  ) enjoys. Its Mississippian Lime play is producing healthily and at lower drilling costs than other oil plays. Building its own saltwater disposal system doesn't hurt earnings, either. SandRidge also has cut its leverage in half and funded drilling through 2014 with the sale of its Permian Basin assets. Also, the company sells at a discount, trading at low multiples and under its net asset value. Production from the Mississippian Lime doubled in 2012, so with all the assets and drilling activity SandRidge is engaged in, production growth should continue.

Investors were startled after SandRidge plummeted when natural gas prices reached 10-year lows, but with the company focusing on growing liquids production, the future looks optimistic. If you are unsure about the future of this emerging oil and gas junior and are looking to find out more about its strengths and weaknesses, then check out The Motley Fool's premium research report detailing SandRidge's game plan and what to expect from the company going forward. To get started, simply click here now!

Why Debenhams, GKN, and Persimmon Should Beat the FTSE 100 Today

LONDON -- After falling for four trading days in a row, the FTSE 100 (FTSEINDICES: ^FTSE  ) is finally recovering a little ground today, up a modest 0.32% to 6,264 points by 7:50 a.m. EDT. Depressed commodities prices are still keeping mining shares down, and the mood seems to be generally bearish, with some fearing that we could be in for a fall back below the 6,000 level.

But some individual companies are doing fine. Here are three that are on the up today.

Debenhams
Interim results have sent Debenhams shares up 7.4% to 86 pence. Like-for-like sales rose 3.1% compared with the first half of last year, and though pre-tax profit fell by 5.4% to 120.3 million pounds, bottom-line earnings gained 2.7% to 7.6 pence per share. There will be an interim dividend of 1 pence per share, and the firm's long-term share buyback plan is progressing. And in these days when brick-and-mortar sales are not enough, it's good to hear that Debenhams' online sales grew by 46% to account for 12.7% of total sales.

Current forecasts suggest flat earnings this year, so we'll have to wait and see if that is upgraded now. There's a dividend yield of about 4% expected.

GKN
An interim update from GKN has sent the auto and aerospace engineer's share price 3.4% to 254 pence today after first-quarter sales rose 9% to 1.89 billion pounds, boosted by last year's acquisition of the former Volvo Aero (now GKN Aerospace Engine Systems). Pre-tax profit did fall a little, down 4% to 119 million pounds, but that was partly due to a one-off 23 million pound restructuring charge.

Chief executive Nigel Stein said: "With restructuring charges now largely behind us, we expect the remainder of the year to show improvement."

Persimmon (LSE: PSN  )
Shares in homebuilder Persimmon have gained almost 1% and are now up nearly 80% over the past 12 months. Today's boost came from an update to coincide with today's annual general meeting that told us of a "good start to 2013," with numbers of visitors to the firm's development sites up 5% during the first 15 weeks of the year.

The government's new "Help to Buy" measures have also boosted enquiries, which are running 30% ahead of last year (and were 24% ahead prior to the announcement of the scheme).

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

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What Buffett Says About Diversification Will Shock You

The Huge Mistake Apple Investors Are Making

Yesterday, Apple (NASDAQ: AAPL  ) shares briefly fell below the $400 mark, dropping to their lowest levels since late 2011. Yet before you fall prey to the mad media frenzy that the milestone-breach created, step back and remember that every analyst, news source, and other so-called expert that drew any huge conclusions from Apple's short-term movements was guilty of making a simple mistake: anchoring their views on the stock to a particular price.

The meaninglessness of $400
Anchoring is a common practice among investors. Whenever you draw an arbitrary line in the sand for a particular financial metric such as a stock price or index level, you're anchoring your perspective on that stock to your chosen number, even if it's based on nothing other than psychology. Anchoring reflects the behavioral need to try to take the chaos of the stock market and draw seemingly orderly conclusions, even if they're based only on the initial arbitrary anchor.

Of course, the more people anchor to a particular figure, the more important it becomes to the overall psychology behind the stock. For instance, many investors pay close attention to whether a stock's price is above or below what they paid for the stock. Yet most of the time, since every investor paid different prices for their particular shares, my anchor will bear no resemblance to your anchor, making them largely irrelevant as a predictor of group behavior.

By contrast, sometimes big groups of people come to the same conclusions and anchor to the same level. That happened with Facebook (NASDAQ: FB  ) in its IPO, where $38 per share still represents a huge line in the sand based on its initial offering price. If enough people decide that Facebook hitting $38, Apple falling to $400, the Dow hitting a new record high, or gold dropping below $1,400 per ounce represents some sort of special turning point, then what happens at those levels can turn into a self-fulfilling prophecy.

What's really important
To avoid making mistakes based on anchoring, it's critical to remember that fundamental events rather than arbitrary milestones are responsible for changes in the intrinsic value of the companies you invest in. So if yesterday's announcement from Cirrus Logic truly reflects a drop in long-term demand for Apple's products, then its decline may be justified, even if the coincidence of its decline to $400 is irrelevant. If Facebook can monetize its mobile platform and build profit, then climbing from current levels to $38 per share may be just a stepping stone to even larger future gains. If stories that Cypriot central bankers may need to sell off bullion reserves prompted investors in SPDR Gold (NYSEMKT: GLD  ) to dump their gold holdings and flood the market with a glut of supply in the face of weak demand, then the big decline in gold prices earlier this week makes perfect sense. But don't make the mistake of thinking that the particular levels they hit along the way are necessarily an exact reflection of those fundamental changes.

Experienced investors are constantly on guard to avoid emotional responses to market movements. Being aware of the temptation to anchor on meaningless metrics will help you avoid making false conclusions from them.

Get the latest on whether Apple has become an amazing value or a deadly value trap. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple, and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.

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

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

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

Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on DTE Energy (NYSE: DTE  ) , 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, DTE Energy generated $389.0 million cash while it booked net income of $610.0 million. That means it turned 4.4% of its revenue into FCF. That sounds OK. However, 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 DTE Energy look? Take a peek at the chart below, which flags questionable cash flow sources with a red bar.

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

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

With questionable cash flows amounting to only 6.3% of operating cash flow, DTE Energy's cash flows look clean. Within the questionable cash flow figure plotted in the TTM period above, other operating activities (which can include deferred income taxes, pension charges, and other one-off items) provided the biggest boost, at 2.5% of cash flow from operations. Overall, the biggest drag on FCF came from capital expenditures, which consumed 82.4% 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.

Can your retirement portfolio provide you with enough income to last? You'll need more than DTE Energy. Learn about crafting a smarter retirement plan in "The Shocking Can't-Miss Truth About Your Retirement." Click here for instant access to this free report.

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

Add DTE Energy to My Watchlist.

Toll Brothers' Crystal Ball

Can you really take a company's yearly guidance seriously? Who can predict future events a year from now? It's so hard most companies skip the ordeal. Who can blame them? So many unforeseen events can derail a company's guidance. Yet, a few daredevil companies continue giving their year outlook. As far as I'm concerned, that's akin to writing the front page of next year's Wall Street Journal. I've already highlighted how Caterpillar (CAT) and Parker Hannifin (PH) - two excellent companies - almost never get their yearly guidance right.

So who really has the crystal ball? Who gets it right year after year in both miserable and wonderful economic times. How about Toll Brothers (TOL), the luxury homebuilder? This highly cyclical company hits its outlook just about every time. Each December, Toll gives its outlook as to how many homes it will sell and at what average selling price. Remarkably, the home builder almost always makes good on its prediction. That's crazy-brilliant forecasting. Toll gave accurate forecasts during the 2008 and 2009 housing debacle. And better still, Toll's results usually come in at the top of guidance for a nice upside surprise.

Here are their unit forecasts, which are uncannily accurate - all the more remarkable considering Toll gives them a year early! Toll usually gives 800 unit ranges. Note how deliveries have been coming in toward the upper limits of the ranges given.

(click to enlarge)

(Sourced from 10Qs.)

Here are their average sales prices predicted a year early. The outcome: Another forecasting tour de force. Except for 2009, Toll has been hitting the upper end of its range.

(click to enlarge)

(Sourced from 10Qs)

This year, they are forecasting a 14! to 31% increase in homes sold and a 4 to 10% increase in average selling prices - a startling growth prediction. In view of its past performance in meeting its outlook, you can bank on Toll Brothers numbers. The home builder has earned the street creds to deliver on its promises.

Toll Updates Its Guidance

After its first quarter, Toll narrowed its forecast from 3600 - 4400 to 3750 - 4300 delivered homes, still at an average selling price of $595,000 to $630,000. The new guidance translates into $2.23 to $2.71 billion of revenue for FY 2013. Removing the $424 million Toll reported for Q1 leaves $1.8 to $2.3 billion in revenue for the rest of the year, about 15 to 47% more than last year.

Very few companies increase sales like that. Even fewer, can make promises they can keep. Toll is one of those few that does both.

The Backlog Tells The Story

Toll's backlog has been increasing. The backlog - the value of homes under agreement but not yet delivered - has been increasing. At the end of FY 2012, Toll's backlog value was 72% greater than a year ago. You'll note it's increasing at a faster rate than during the housing boom period of 2003 - 2005.

(click to enlarge)

Toll Brothers has lagged the other home builders. Trailing PE is 10.8 and Price/Tangible Book is 1.7. Yesterday's 7% drop gives investors an excellent entry point.

Disclosure: I am long TOL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. (More...)

Additional disclosure: The opinions in this document are for informational and educational purposes only and should not be construed as a recommendation to buy or sell the stocks mentioned. Past performance of the companies discussed may not continue and the companies may not achieve the earnings growth as predicted. The information in this document is believed to be accurate, but under no circumstances should a person act upon the information contained within. We do not recommend that anyone act upon any investment information without first consulting an investment advisor as to the suitability of such investments for his specific situation.