Is LULU a Lemon of a Stock?

Today I am going to share with you one of my favorite technical tools and how to use this tool to successfully navigate the ups and downs of Lululemon Athletica Inc. (NASDAQ:LULU).

Click here to watch the video!

Just recently, there has been a great deal of controversy about this company. You might recall the problem they had with their see-through workout pants. It turns out their workout pants were just a little bit too sheer for everyone’s comfort. The company also got sued by a pension fund for giving executives big bonuses on the eve of the recall of their too sheer workout pants.

In this video, we will be diving into Lululemon (NASDAQ:LULU) using a technical tool that is readily available to you and one that is very easy to use and understand. This short video is just five minutes in duration and will help you understand the key element of this simple tool. It is a tool I have used successfully for many years in both stocks and other markets. Like any technical tool, it is not perfect and not guaranteed to make you money, however this technical tool comes as close to perfection as you can get.

Watch the video here.

I hope you learn from today’s video and can apply your new knowledge to make your own trading even more profitable.

For more information on the tools I use in this video, click here to visit MarketClub.

Adam Hewison
President, INO.com
Co-Creator, MarketClub

By MoneyMorning.com.au

One thing you can guarantee never receiving with a Port Phillip Publishing subscription is a consensus view. Each editor is free to do his own thinking and form his own strategy. But if there is a bit of theme between them right now, we could probably boil it down to this:

Cash is king in this market.

There’s two sectors of the market where this key asset can often be in scarce supply – small caps and junior miners.

In other words, right where Diggers & Drillers and Australian Small-Cup Investigator go hunting for outsized gains.

So today’s Money Weekend will show you how editors Dr Alex Cowie and Kris Sayce see things across the board, and the strategy to use…

Beware Market Expectations

In the big picture, you don’t need to look much further than the world’s largest diversified miner, BHP, to see what we mean. CEO Andrew Mackenzie has put everyone on notice that the company is going to spend less on capital investment. He’s looking to increase profits via streamlining their existing operations.

In other words, he’s hanging on to more cash in the face of the soft outlook for commodity prices.

The recent trend in the market has been clearly in favour of paying out earnings to shareholders. Investors are looking at income, not growth. That’s bid up dividend paying stocks and has been a strong current driving the banks and Telstra.

Miners like BHP have to invest to survive and grow. But so do other businesses. It really boils down to four options for any company. It can use its money for capital expenditure, to pay off debt, bank the cash, or return it to shareholders.

The more they pay out earnings, the less they have to invest in their own business.

Usually, investors only bid up stocks aggressively when they see a lot of future profit and growth.

That’s why small caps and junior miners can be so lucrative. Even if they don’t earn any money, if investors think they’re on a gold mine, the shares will rise in anticipation.

One thing we’ve picked up since following markets is how sensitive they are to expectations. Beat the profit guidance and your stock soars. Miss it, and the market will take you down.

The same dynamic is playing out right now in iron ore and gold. Both are down for the year. But gold stocks have been hammered much more. That’s because the market was expecting a stronger gold price. It had already discounted soft iron ore prices.

That’s probably one reason BHP’s shares fell a bit this week but didn’t really sell off in a major way. The question hanging over the company is what they’ll do with their surplus cash. A company like BHP has the relative luxury of deciding what to do with its cash flow because it has producing mines generating earnings.

There are plenty of companies, especially in mining, who don’t have that luxury.

Looking for Gold in Cash

That’s because they’re not producing anything yet. That means they have nothing to sell and no money coming into the business.

It’s always risky to own shares like these. The payoff is you can make big gains if the company succeeds. But right now this kind of company looks a very dangerous place to be in this market.

That’s why, over at Diggers & Drillers, Alex is switching his focus away from explorers to producers with cash flow or established developers with a tonne of money on the books. He doesn’t want to go near any company that might have to raise money from the market.

He’s on the hunt for ‘little cash boxes’, as he called them, operating very favourable projects. ‘As with BHP, it will be the projects with the lowest construction costs and highest return that will get the funding and the green light,’ Alex told his subscribers this week. Explorers that live or die off drilling results are off the table.

That’s a similar message from Kris Sayce over at Australian Small-Cap Investigator. He’s going after ‘cash box stocks’ because he thinks investors will begin looking at the small end of the market as they hunt for companies that can pay some of their earnings out and offer growth potential at the same time.

In his latest report he says, ‘understand that you should follow what investors do, not what they say…Even though the market mantra is about the search for yield, the reality is different. After a year where ‘safe’ and boring blue-chip income stocks gained 50% or more, investors are getting greedy.

‘That’s why I believe the search for the Holy Grail of stocks – those that can grow and pay a dividend – is the best way to play the stock market during the next phase of this investing cycle.’

In other words, cash is king.

Callum Newman
Editor, Money Weekend

Join Money Morning on Google+

PS. Don’t forget if you want to keep track of the latest things we’re reading and brief commentary on events that happen through the day, check out our Google+ page and Kris Sayce’s as well.

From the Port Phillip Publishing Library

Special Report: IT’S A TRAP

Daily Reckoning: Japanese Bonds Yields are Actually Rising

Money Morning: We’re Still Not Selling the Aussie Stock Market…

Pursuit of Happiness: What Drives Entrepreneur’s and Inventors

By MoneyMorning.com.au

TECHNOLOGY: The Best Portable Transportation Since the Bike

Public roads are log jammed and in disarray. Public transport systems are a shambles. Motorbikes and scooters are too dangerous. And riding a bike means you’re more likely to get ‘doored’ than make it to your destination.

Aside from walking what other green alternatives are there to get from A to B at a decent speed? Not many. Except for inventions like the Segway.

But now, a new invention has taken the place of the Segway. And it’s called the Hovertrax.

From Shane Chen, a serial inventor, Hovertrax is’an autobalancing electric transporter with gyro technology.‘

Source: Kickstarter

Purely electrically charged, the Hovertrax can hold a person up to 102kg and travel about 7km on a single charge. It takes an hour to charge, has no emissions and charges itself as it brakes and slows down. You can fit it in a backpack and it charges via a normal electricity plug.

The gyroscope technology in it means, like a Segway, it’s pretty hard to fall off. And control is simply toes forward and heels back. That’s it.

It’s a great alternative for city dwellers. And perfect for short trips around town. I don’t see a future of freeways with people on Hovertrax, but it’s certainly something different. The need for a helmet is unlikely as honestly, you’d look like a goose on one with a helmet.

Regardless, it’s this kind of innovation that takes the world a step closer to reducing emissions and cleaning up the environment.

Hovertrax is a Kickstarter project that’s exceeded its funding target. That means it will be made. You can see the project here. I think it’s the best short distance transportation method created since the bike.

HEALTH: Why Dolly the Sheep Will Do for Now

Regenerative medicine will be one of the biggest changes to modern medicine ever. The crux of it is it fixes the body when injury and disease strike. That is it quickly repairs the body where otherwise repair could not occur.

During the week a major scientific breakthrough has brought this topic to the fore.

The hot debate has been about cloning to create embryonic cells to extract embryonic stem cells. The point of extracting stem cells is because they are the primary tool in regenerative medicine. Stem cells are the microscopic good guys that will shape the future of modern medicine.

But the cloning side of this breakthrough has created some controversy. And rightly so. Because this opens the debate on just how far scientists can take cloning technology. For now they’re a fair way off cloning and growing a human, but it could be just a matter of time.

Dolly the Sheep was the first cloned mammal. But for years before her birth cloning experiments had been undertaken. Even now scientists are working away at cloning primates. The next step from there is cloning humans.

But why is there a need for cloning anyway? From our perspective, there isn’t one.

Populations are exponentially growing, and arable land is running thin as it is. What’s the point of trying to create more humans, circumventing the traditional biological route? It’d just put a greater strain on economies and social systems.

We think this avenue of scientific research is better suited to cloning livestock. Because we could always do with more beef, pork and chicken for the world. But more primates and humans…no thanks.

Some argue we’ll never clone humans anyway. They say all we need is to clone human embryos for the stem cell benefit. This in turn will help the regenerative medicine revolution.

But that’s not true either, there’s plenty of research elsewhere in the world with stem cells. And there are companies well advanced in this area of expertise. This latest breakthrough is certainly topical. But it’s futile as there will be, and are, other methods for helping fix the world’s medical problems.

ENERGY: 2013, the Year the Sun Went Mental

We’re constantly talking about the potential the sun has for helping the world to create renewable energy. It’s the best source we have to harness power that will never run out.

Well actually that’s not technically correct. Although the sun will continue to send solar rays our way for many millions of years to come. It will be a few billion years after that when the sun goes ‘Boom!’ and dies.

Evidence that this is going to happen occurred early Monday morning. NASA’s Solar Dynamics Observatory, used to capture the intense heat from a solar flare, took the photo below. To give you a scale comparison, the flash below is substantially bigger than the entire Earth.

Source: NASA

Every 11 years the sun peaks in terms of solar activity. It fires off huge solar flares and Coronal Mass Ejections (CMEs). These can do some pretty nasty stuff to things that get in the way.

CMEs are a giant burst of solar wind, energy particles and cosmic rays. Considering one solar flare has a length about 10-20 times the width of the Earth you get an appreciation of how big these are.

With CMEs, when they erupt from the Sun’s surface they send a shockwave through the galaxy. This can have a pretty strong impact when the Earth is in its pathway. It disrupts and breaks satellite communications, and in some instances has even melted down power stations due to the power surge of energy particles.

Added to this, if an astronaut is on Mars or the Moon, a CME could have a deadly impact due to the energy particles and x-rays it discharges. That might make the Mars One applicants we wrote about here last week take a second thought.

The next step in solar technology might be the development of a satellite system that can catch the energy particles from a solar flare or CME. Harnessing that kind of power might make interplanetary travel a little bit easier.
The current 11 year cycle of crazy sun activity is due to peak later this year. This means we’re on track for some pretty huge solar action. Already since January we’ve had some major solar flares, the biggest seen for a number of years. And Monday was a big CME. Expect it to get more heated towards the end of the year, and fingers crossed satellites don’t start falling from the sky.

Sam Volkering

Join Money Morning on Google+

Technology Analyst, Money Weekend

From the Archives…

Why Small-Cap Resource Stocks Beat Blue Chips Hands Down
10-05-2013 – Dr Alex Cowie

Can Australian Stocks Defy Gravity if The Australian Dollar Falls?
9-05-2013 – Murray Dawes

Build Wealth Fast through the Resource Sector
8-05-2013 – Dr Alex Cowie

36% Potential Upside for Australian Stocks Over the Next Two Years
7-05-2013 – Kris Sayce

The Key to Becoming a Successful Investor
6-05-2013 – Kris Sayce

Has Apple Lost Its Way?

In a recent Bloomberg news poll, 71% of investors believe Apple has become less innovative. Has Apple lost its way? In today’s short five minute video, I will be examining Apple stock (NASDAQ:AAPL) and investigating what drives the price.

Watch this short video here.

We’ll look to see what pushed Apple’s stock price over $700 and what caused Apple to crash below $400 in such a short period of time.

For more information on the tools I use in this video, click here to visit MarketClub.

Enjoy the video,
Adam Hewison
President, INO
Co-Creator, MarketClub

By The Sizemore Letter

Investors are starved for yield.  It’s not exactly breaking news.  With traditional savings vehicles such as savings accounts, CDs, and bonds yielding next to nothing, investors have been flocking to dividend-paying stocks for years.

On the surface, this makes all the sense in the world.  Unlike fixed income investments, dividend-paying stocks tend to enjoy rising payouts over time (or at least they do if you choose them well).

There‘s just one problem with this.  Defensive, dividend-paying sectors are, as a group, expensive relative to the broader market.  Investors are paying a premium for slow growth…which is not exactly a recipe for long-term investment success.

As an example, consider the utilities sector.  The Utilities Select Sector SPDR ($XLU), a popular ETF proxy for the sector, trades for 16 times earnings and yields just 3.7%.

Utilities have had good multi-year runs.  In the 2003-2007 bull market, utilities were actually one of the best-performing sectors.  But it’s hard to get excited about them at current prices.

Surprisingly, some of the best dividend deals on offer are in the tech sector.  Microsoft ($MSFT), Intel ($INTC) and Cisco Systems ($CSCO) yield 2.8%, 3.7% and 3.2%, respectively, and all trade at very modest valuations.  All have also been aggressively raising their dividend in recent years. Cisco has nearly tripled its dividend in the past year and a half, and Microsoft and Intel have raised their dividends by 15% and 7%, respectively, in the past year.  Not bad for boring “old” technology companies.

If you are building an income portfolio, you have a choice.  You can load on slow-growth utilities.  Or, you can build a portfolio of solid technology companies with dividends not too much lower that offer far great potential for growth in the dividend stream over time.  The choice should be obvious.

Action to take: Buy “Big Tech” for dividend growth.  Use a stop loss appropriate for your risk tolerance; I recommend something in the ballpark of a 20% trailing stop.

This article first appeared on TraderPlanet.

SUBSCRIBE to Sizemore Insights via e-mail today.

By www.CentralBankNews.info Here’s today’s Central Bank News’ link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don’t miss any important news.

London Gold Market Report
from Adrian Ash
BullionVault
Fri 17 May, 08:15 EST

GOLD PRICES failed to hold a rally above $1380 per ounce in London on Friday morning, trading 5% down for the week as world stock markets held steady.

Both the Euro and British Pound also cut their mid-week rallies against the Dollar, holding gold prices at €1070 and £904 per ounce respectively.

New data overnight showed Japanese machine orders leaping 14% in March from February, while China’s leading economic index rose slightly for last month.

Eurozone construction output sank 8% in March from a year earlier.

“A spell of Dollar weakness looks like gold’s only salvation at the moment,” says one wholesale dealer in a note.

“So another disappointing data point could encourage more short-covering [when bearish traders close their position] ahead of the weekend.”

The US Dollar crept towards a 10-month high vs. a basket of major currencies this morning.

US consumer sentiment data were due for release Friday at 09.55 New York time.

“Bullion’s price break below the psychological $1400 an ounce level may introduce additional near-term pressure on gold,” says bullion market-maker HSBC’s James Steel.

“However, physical demand is likely to pick up further given the price drop, to help stem potential losses.”

Over in India – the world’s biggest gold buying nation on an annual basis – “There is no supply,” Reuters today quotes Prithviraj Kothari, head of Mumbai importers Riddhi Siddhi Bullions Ltd.

Thanks to this week’s sudden imposition of Indian gold import restrictions, supply is so tight some distributors are charging up to $20 an ounce above international benchmark London prices, Kothari says.

Hong Kong premiums have jumped this week to record highs of $5 per ounce, with the kilogram gold bars favored by China’s investment market now “hard to come by” according to one Singapore dealer.

Even so, “Many people are waiting on the sidelines,” reckons Singapore dealer Brian Lan at GoldSilver Central Pte, “as they are expecting another drop” in global gold prices.

Amongst Western money managers, “We’re seeing some of the pension funds selling via the

ETFs,” reckons analyst Daniel Smith at Standard Chartered bank, “which is a bit of a worrying sign.”

Exchange-traded trust funds backed by gold shed yet more metal on Thursday, with the two leading US funds – the GLD and IAU – dropping 7 tonnes between them to reach the lowest combined level since April 2010 at 1,233 tonnes.

Since Dec. 2012’s all-time peak, the GLD and IAU have lost 21.4% of their combined gold ETF holdings.

“The price of silver in 2013 will primarily be determined on the demand side,” says the latest Commodities Weekly from French investment bank and London bullion dealer Natixis, forecasting “relatively stable” supply with a slight dip in recycling.

On the industrial side it says, and “despite promising expectations from the rest of the world, we expect a slight drop in [photo voltaic] installations due to weak European [solar panel] demand” thanks both to low subsidies from government and the continued Eurozone crisis.

Silver ETF holdings have yet to follow gold trust funds sharply lower, Natixis notes – primarily because private investors own the former, as opposed to money managers in gold.

“[But] at some point these retail investors are likely to start selling.”

Total silver ETF. holdings of 19,400 tonnes currently equate to 60% of last year’s total market supply, the bank’s analysis adds, and “an outflow…could introduce substantial downside risks for silver prices.”

Adrian Ash

BullionVault

Gold price chart, no delay | Buy gold online

Adrian Ash is head of research at BullionVault, the secure, low-cost gold and silver market for private investors online, where you can buy gold and silver in Zurich, Switzerland for just 0.5% commission.

(c) BullionVault 2013

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

By HY Markets Forex Blog

Eurozone and US inflation prices have dropped to its lowest in years.

Reports show that the figures for April dropped to 1.2% and the US inflation at 1.1%, both target inflation at 2%.

The main cause of the fall in both cases was the lower oil price which is down to less to $93 a barrel from $120 a barrel in March and the weak demands is also another main factor for both economies.The fall in the cost in oil prices is the main cause of the US monthly inflation rate which as has fallen to its lowest since December 2008.

On Wednesday, reports showed the eurozone was still in recession due to its weak growth in the economy, budget cuts and high rate of unemployment.

France recently just slipped back into recession while Germany grew by 0.1% in the first quarter of the year.  The Greece economy went through the overall deflation. European Central Bank cut the interest rates to a record of 0.5% earlier this month.

Inflation can also be caused by low inters rate however with weak economic growth ,authorities get more concerned about the  deflation .According to analysts reports show signs that inflation may be problem in the future .

The highest price rises were found in Romania, Netherlands and Estonia.

The post Eurozone and US inflation falls appeared first on | HY Markets Official blog.

Article provided by HY Markets Forex Blog

By HY Markets Forex Blog

Dell has reportedly slipped by 79% in net profit due to poor computer sales as more consumers shift to tablets and smart phones.

Net profits fell to $130m with revenue down 2% to $14bn. On Thursday, Dell said that revenue from new technologies, services and software increased 12% to $5.5bn.The battle between billion founder Michael Dell and two of its biggest shareholders still goes on.

Michael Dell plans to take the company private are being opposed by investors. Dell and the private equity group Silver Lake has offered to buy back the company for an approximately $24.4bn and divert the PC business to computer and mobile services.

The biggest shareholders of the company Carl Icahn and Southeastern Asset management are against the private deal and call the deal “too cheap “for a company trying to become a service provider.

With the argument between the shareholders and founder Michael Dell it’s hard to point out which direction the PC makers might be taking.

“We made progress in building our enterprise solutions capabilities in the first quarter, we have taken actions to improve our competitive position in key areas of the business, especially in end-user computing, and it has affected profitability,” Chief Financial Officer Brian Gladden said.

Due to Michael Dell’s private deal, the company could not provide a financial outlook.  Shares in Dell slipped 3 cents to $13.40 after closing at $13.43 on Nasdaq.

The post Dell slips in profits as founder’s battle continues appeared first on | HY Markets Official blog.

Article provided by HY Markets Forex Blog

By www.CentralBankNews.info     Chile’s central bank held its policy rate steady at 5.0 percent as widely expected, saying indicators for the first quarter of 2013 show “decelerating output and demand” while inflationary expectations remain around the bank’s target.
     The Central Bank of Chile, which last cut rates by 25 basis points in January 2012, also said the peso’s “exchange rate has depreciated; however in real terms it is still in the lower part of the range that is compatible with its long-term fundamentals.”
    In its two previous statements, the central bank had mentioned the appreciation of the peso, fueling speculation that authorities were starting to consider intervening to weaken it, as in 2011.
    Since the beginning of this year, the peso is largely unchanged and was quoted around 478 peso per U.S. dollar today. In early April it rose to around 465 per dollar when authorities expressed concern.
    Chile’s inflation rate fell to 1.0 percent in April from 1.5 percent in March, below the central bank’s target of 2-4 percent.
    Commenting on international financial conditions, the central bank said they had improved but the euro zone remains in recession and “in a fragile fiscal and financial situation” while there is increased optimism in the United States and Japan.

   Indicators for China and other emerging economies point to marginally weaker growth while the U.S. dollar had appreciated and metal prices – Chile is the world’s largest copper producer – had again receded in recent weeks, especially for copper, the bank said.
    Chile’s Gross Domestic Product expanded by 1.5 percent in the fourth quarter of last year from the third quarter for annual growth of 5.7 percent.
    Earlier this month, Chile’s central bank governor said first quarter economic activity had declined faster than expected and the annual growth rate could ease to 4.4 percent.
    The central bank expects Chile’s economy to grow around 5 percent this year compared with growth of 5.5 percent in 2012, down from 2011’s 5.9 percent.
 
    www.CentralBankNews.info