The escalating conflict between Russia and Ukraine had dramatic effects on financial markets across the globe, with stock markets generally taking it on the chin, but commodities markets performing quite well. That held true for precious metals, with April gold futures climbing $29 per ounce to $1,350, while May silver futures gained a less impressive $0.24 per ounce to settle at $21.49. Those jumps led to a 2% gain for the SPDR Gold Shares (NYSEMKT: GLD ) and a rise of 1.3% for the iShares Silver Trust (NYSEMKT: SLV ) , and the Market Vectors Gold Miners ETF (NYSEMKT: GDX ) split the difference by gaining 1.6%.
Today's Spot Price and Change From Friday
$1,351, up $23
Best International Companies To Watch In Right Now: Zulily Inc (ZU)
Zulily, Inc., incorporated on October 16, 2009, is an e-commerce company. The Company, through its desktop and mobile Websites and mobile applications, which it refers to as its sites, helps its customers discover new and unique products. The Company provides moms with a selection of over 4,500 product styles offered on a typical day through various flash sales events, which are limited-time curated online sales of selected products launched each day on its sites. The Company offers merchandise primarily targeted at moms purchasing for their children, themselves and their homes. Its merchandise includes children�� apparel, women�� apparel, and other product categories, such as toys, infant gear, kitchen accessories and home decor The Company sources its merchandise from thousands of vendors, including emerging brands and smaller boutique vendors, as well as larger national brands.The Company offers merchandise primarily targeted at moms purchasing for their children, themselves and their homes. Its merchandise includes children�� apparel, women�� apparel, and other product categories such as toys, infant gear, kitchen accessories and home decor.
Offering for Moms
The Company launches a variety of flash sales event. Typically, these events feature over 4,500 product styles from different vendors and last for 72 hours. The day�� events are kicked off by an early morning e-mail to its email subscribers and push communication to users of its mobile applications offerings are only available for a limited time and in a limited quantity.
Offering for Vendors
The Company�� primary vendors are emerging brands and smaller boutique vendors. These are typically small-to-medium sized businesses, many of which were started by mom entrepreneurs. The Company introduces these vendors to its large audience and help them tell their stories in a way that differentiates their products and properly reflects their brand attributes. Its entire operational infr! astructure-photography studios, editorial writers, fulfillment operations and technology capabilities-is designed to showcase these emerging brands��and smaller boutique vendors��products in the most compelling, engaging and personalized way.
The Company competes with Amazon.com, Target, Toys R Us, Walmart and eBay.Advisors' Opinion:
- [By Paul Ausick]
Zulily Inc. (NASDAQ: ZU) priced its Friday IPO at $22 a share, above the expected range of $18 to $20 and the stock soared to close up nearly 72% at $37.70. The e-commerce and daily deals website for moms is a dual-stock company, with Class B shares getting 10 votes per share and Class A shares getting one per share. All the Class B stock is held by insiders and they will control 99% of the voting power in the company.
- [By Rich Duprey]
So much promise, so many opportunities, and so little to show for it. E-commerce retailer Zulily (NASDAQ: ZU ) seems to have squandered most of its potential since going public. After hitting $73 a share soon after its IPO in November 2013, the stock of the mom-focused website has cratered and lost two-thirds of its value.
- [By Paul Ausick]
Stocks on the Move: Zulily Inc. (NASDAQ: ZU) is up 71.4% at $37.70 after its IPO today. Cadence Pharmaceuticals Inc. (NASDAQ: CADX) is up 33.8% at $7.87 on a patent ruling. Electronic Arts Inc. (NASDAQ: EA) is down 7.4% at $24.04.
- [By Rich Bieglmeier]
Zulily Inc. (NASDAQ:ZU) is up more than 10% as we type with another 23.55% to go according to Goldman Sachs. Analyst, Taposh Bari upgraded ZU to a "Buy" recommendation from "Neutral" and says the online retailer is headed to fifty bucks.
Top 5 Electric Utility Stocks For 2014: HFF Inc (HF)
HFF, Inc. is a provider of commercial real estate and capital markets services to both the users and providers of capital in the United States commercial real estate industry. It is a full-service commercial real estate financial intermediary in the United States. As of December 31, 2011, the Company operated out of 20 offices nationwide. During the year ended December 31, 2011, the Company advised on approximately $35.6 billion of completed commercial real estate transactions. The Company offers debt placement, investment sales, distressed debt and real estate owned advisory services, structured finance, private equity placement, investment banking services, loan sales and commercial loan servicing. In October 2011, the Company sold Las Olas City Centre. In March 2012, the Company sold 801 9th Street, NW, a 236,054 square-foot, Class A office building in Washington, D.C. In July 2013, the Company announced that it has closed the sale of Washington Harbour, a 557,961-square-foot, mixed-use project located along the Potomac River in Washington, D.C.'s Georgetown submarket. In September 2013, the Company announced that it has closed the sale of Greenway Plaza, a 4.4 million-square-foot, Class A office complex in Houston, Texas, and 777 Main, a 980,374-square-foot Class A office property in Fort Worth, Texas. In November 2013, HFF Inc closed the sale of The Granary. In November 2013, the Company�� subsidiary, Holliday Fenoglio Fowler, L.P. sold Avalon on the Sound East, a 588-unit, 39-story, Class A multi-housing tower in New Rochelle, New York. In December 2013, HFF Inc sold its Pacific Commons Shopping Center, an 865,783-square-foot center in Fremont. In January 2014, HFF Inc has closed the sale of 225 West Santa Clara, a 16-story, 349,318-square-foot, transit-oriented trophy office property in downtown San Jose, California. In January 2014, HFF, Inc. sold two Central Florida Publix-anchored retail properties in Orlando and suburban Tampa, and sold eight-property, fully leased industrial portfolio in! the Meadowlands submarket of New Jersey. In January 2014, HFF Inc closed the sale of 800 Madison, a 217-unit, Class A multi-housing community with ground floor retail in Hoboken, New Jersey.
Debt Placement Services
The Company offers its clients a range of debt instruments, including but not limited to, construction and construction/mini-permanent loans, adjustable and fixed rate mortgages, entity level debt, mezzanine debt, forward delivery loans, tax exempt financing and sale/leaseback financing. Its clients are owners of various types of property, including, but not limited to, office, retail, industrial, hotel, multi-housing, self-storage, assisted living, nursing homes, condominiums and condominium conversions, mixed-use properties and land. The Company�� clients range in size from individual entrepreneurs who own a single property to the large real estate funds and institutional property owners worldwide who invest globally, especially in the United States. Debt is or has been placed with capital funding sources, both domestic and foreign, including, but not limited to, life insurance companies, conduits, investment banks, commercial banks, thrifts, agency lenders, pension funds, pension fund advisors, real estate investment trusts (REITs), credit companies, opportunity funds and individual investors. In 2011, its transaction volume in debt placements was approximately $18.7 billion.
Investment Sales Services
The Company provides investment sales services to commercial real estate owners who are seeking to sell one or more properties or property interests. In 2011, it completed investment sales of approximately $12.6 billion.
Structured Finance and Private Equity Services
The Company offers an array of structured finance and private equity alternatives and solutions at both the property and ownership entity level. In 2011, it completed approximately $2 billion of structured finance and advisory services transactions.
Private Equity, Investment Banking and Advisory Services
The Company�� broker-dealer subsidiary, HFF Securities L.P. (HFF Securities), undertakes both discretionary and non-discretionary private equity raises, select property specific joint ventures and select investment banking activities for its clients. At December 31, 2011, it had $1.9 billion of active private equity discretionary fund transactions. Through HFF Securities, it offers its clients the ability to access the private equity markets for an identified commercial real estate asset and discretionary private equity funds, joint ventures, entity-level private placements and advisory services, as well as structured finance services. HFF Securities��services to its clients include joint ventures, private placements, advisory services, and marketing and fund-raising.
The Company assists its clients to sell all or portions of their commercial real estate debt note portfolios, which can include performing, non-performing and distressed debt and/or real estate owned properties. It had consummated $2.3 billion in loan sales transactions in 2011.
Commercial Loan Servicing
The Company provides commercial loan servicing (primary and sub-servicing) for life insurance companies, Federal Home Loan Mortgage Corporation (Freddie Mac), Federal National Mortgage Association (Fannie Mae) through relationships with a range of delegated underwriting and servicing (DUS) lenders, commercial mortgage-backed securities (CMBS) originators, mortgage REITS and debt funds, groups that purchase performing and/or non-performing loans, as well as owners who sell commercial real estate subject to a purchase money mortgage. During 2011, it had approximately 35 correspondent lender relationships with life insurers.
The Company competes with CBRE Capital Markets, Cushman & Wakefield, Eastdil Secured, Jones Lang LaSalle, Northmarq Capital and Berkadia.Advisors' Opinion:
- [By Hilary Kramer]
Top 5 Electric Utility Stocks For 2014: Iron Mountain Incorporated(IRM)
Iron Mountain Incorporated, together with its subsidiaries, provides information management services primarily in North America, Europe, Latin America, and the Asia Pacific. The company offers records management services, including records management program development and implementation based on best-practices to help customers comply with specific regulatory requirements; implementation of policy-based programs that feature storage for various media comprising paper; flexible retrieval access and retention management; hybrid services to help organizations gain control over their paper records; and specialized services for vital records and regulated industries, such as healthcare, energy, government, and financial services. It also provides data protection and recovery services, such as disaster preparedness; off-site vaulting of data backup media for data recovery in the event of a disaster, human error, or virus; online backup and recovery solutions for desktop and la ptop computers, and remote servers; and technology escrow services to protect and manage source code and other proprietary information. In addition, the company offers information destruction services that primarily consist of physical secure shredding operations; and is involved in the shredding of sensitive documents to third-party recyclers. Further, it provides fulfillment services that assemble custom marketing packages and orders, as well as provide reporting on customer marketing literature inventories; and professional consulting services to develop and implement comprehensive records and information management programs. Iron Mountain Incorporated serves commercial, legal, banking, health care, accounting, insurance, entertainment, and government organizations. The company was founded in 1951 and is headquartered in Boston, Massachusetts.Advisors' Opinion:
- [By Ben Levisohn]
How’s this for an ugly chart?
That’s a 52-week chart of Iron Mountain (IRM), and that big decline–and gap–you see is what happens when investors have their hearts set on seeing a company convert into a REIT only to have their hearts broken by the IRS.
Whether a company can convert into a REIT is dependent on the definition of “real assets,” and when the IRS announced in June that it had put together a working group to figure define just what a real asset is, investors freaked. In case you’re wondering, that’s a 35% drop from peak to trough.
But there may be hope yet, say Piper Jaffray analysts George Tong and Peter Appert. First, they note that the IRS’s decision to convene a working group does not mean that it’s eager to change the definition, but rather to formalize it. They also believe there’s a good chance that Iron Mountain’s storage racks will be deemed “real assets.” For instance, Iron Mountain’s assets are likely to meet the IRS’s definition of “permanence.” Tong and Appert write:
IRM’s racks consist of beams permanently affixed to the foundation of the building capable of withstanding significant weight over many decades. They are not modular in nature, such as grocery aisle shelves (which do not qualify as real assets) that can be taken apart and pieced back together. The racks are never meant to be moved nor have they ever been moved. Removing the racks at IRM will immediately turn them into scrap metal since they cannot be reused. This is because the racks are custom built for each unique building and blueprint, taking into account structural and physical idiosyncrasies, and because of warping that occurs with time.
They also do not believe that the racks will be determined to be deemed “[accessories] to the operation of a business,” because they “do not produce a product” an
- [By Ben Levisohn]
Last week, the IRS gave Iron Mountain (IRM) what it wanted: REIT status. Since then, the storage company’s shares have jumped 18%–and JPMorgan thinks they could head higher.AP
JPMorgan’s Andrew Steinerman and Jeffrey Volshteyn explain why they now rate Iron Mountain Overweight:
Iron Mountain announced that it achieved IRS approval for REIT status retroactively as of January 1, 2014, completing a process that began in 2012.�Iron Mountain stock leaped 20% on Thursday due to the large cash tax savings and the resulting increased dividend. We still see continued upside due to valuation as yield-oriented and REIT investors are attracted to Iron Mountain. While we recognize that Iron Mountain will not prospectively trade at a full real estate valuation (due to the services side of their business), the REIT structure should help highlight the sizable valuation gap that exists today and should narrow over time.
Iron Mountain is much cheaper than the industrial, self storage and data center REITs that carry dividend yields of 3.6%, 3.3% and 4.6% respectively. We believe the dividend yields of prison stocks (also non-traditional REITs), which have dividend yields of 6.3%, provide downside protection to Iron Mountain.
Prison REIT Corrections Corp of America (CXW) yields 6.2% and trades at 24.9 times earnings, while�Geo Group (GEO) yields 6.4% on a P-E ratio of 20.8 times.
Shares of Iron Mountain have, while Correction Corp of America has and Geo Group has.
- [By Ben Levisohn]
Shares of Iron Mountain (IRM) have dropped today after Barclays said the company’s conversion into a real-estate-investment trust is unlikely to succeed.
The downgrade comes following yesterday’s announcement that that Iron Mountain’s CFO, Brian McKeon, would exit that position�leave the company at the end of the month. He will remain at the company until the end of the year to help with the transition. Barclays’ analyst Manav Patnaik believes that’s a sign that a REIT conversion won’t happen. He writes:
It has been 4-6 months since IRM received the ��entatively adverse��ruling from the IRS and the REIT working group was formed. We viewed our 30% conversion probability as cautious, and the announced CFO departure gives us a catalyst to lower it to 10%, which is at the low end of the market�� estimated range of10-20%…
Our lower-than-historical average applied multiples are based on our view that increasing enterprise mobility, along with improvements in cloud security, will precipitate a secular decline (albeit a ��low bleed��for now) of physical storage in favor of cloud storage. Assuming a 5-7 year statute of limitations, an inflection point that makes this ��leed��accelerate is our concern ��and hence a lower multiple. We estimate that fundamental downside, assuming IRM is unsuccessful in converting to a REIT, is $21 ��based on FY14E.
With that, Patnaik cut Iron Mountain to Underweight from Equal Weight with a price target of $23.
Shares of Iron Mountain have fallen 2.3% to $25.72 today, while comparable have been mixed. Leidos Holdings (LDOS) has ticked up 0.6% to $46.28 and Amdocs (DOX) has risen 0.8% to $37.20. Maximus (MMS), on the other hand, has fallen 1.2% to $46.22 and Xerox (XRX) is off 0.3% to $10.62.
Analyst�Manav Patnaik reached out to me after the close on Oct. 11 to clarify that the downgrade is not solely based on the CFO’s
Top 5 Electric Utility Stocks For 2014: Adams Resources & Energy Inc. (AE)
Adams Resources & Energy, Inc., together with its subsidiaries, engages in marketing crude oil, natural gas, and petroleum products. It purchases crude oil, and arranges sales and deliveries to refiners and other customers in Texas and Louisiana with additional operations in Michigan and New Mexico; purchases, distributes, and markets natural gas; and offers value added services by providing access to common carrier pipelines and handling daily volume balancing requirements, as well as risk management services. The company also markets branded and unbranded refined petroleum products, such as motor fuels and lubricants. In addition, it transports liquid chemicals on a �for hire� basis in the continental United States and Canada, as well as engages in the exploration and development of domestic oil and natural gas properties primarily in Texas and the south central region of the United States. Adams Resources & Energy, Inc. was founded in 1973 and is headquartered in Hous ton, Texas.Advisors' Opinion:
- [By Jake Mann]
Energy has been the sector most beaten up in 2014. It has yielded up a number of deeply undervalued companies and it's likely that it enjoys some rebound in 2015. My favorite companies are Adams Resources & Energy Inc (NYSE: AE), VAALCO Energy, Inc. (NYSE: EGY), Pacific Ethanol Inc (NASDAQ: PEIX), Statoil ASA (ADR) (NYSE: STO), VOC Energy Trust (NYSE: VOC), Gran Tierra Energy Inc. (NYSE: GTE), Petrobras Argentina SA ADR (NYSE: PZE), and PBF Energy Inc (NYSE: PBF), all of which are cheap on an acquirer's multiple basis.