Life Insurance: May 2015

Sunday, May 31, 2015

Hydrox cookies bake plans for comeback

The Oreo-buster is back.

Hydrox cookies, those Oreo-like chocolate sandwich cookies, could reappear on store shelves as early as September, says Ellia Kassoff, CEO of Leaf Brands, which recently acquired the rights to the unused Hydrox trademark.

"The cosmic difference between Hydrox and Oreo is that Hydrox is a little more crispy; a little less sugary and stands up better in milk," says Kassoff, who will make the official announcement later this month at the Sweets & Snacks Expo in Chicago on May 20.

Even in a new world of nutritional consciousness, there is little evidence that America's sweet tooth is fading. Sales of packaged cookies and baked goods are expected to top $17 billion by 2017 -- up from $13 billion in 2012, reports Packaged Facts. While the return of Hydrox is expected to be a hit with Baby Boomers who may fondly remember the brand -- formerly owned by Kellogg's, Keebler and Sunshine -- it may be a tougher sell with Millennials who are not very familiar with the cookie brand, which hasn't been regularly sold on store shelves in almost a decade.

"We'll use social media to reach out to Millennials," says Kassoff. The 46-year-old CEO says that he likes to acquire old brands or trademarks that still have fans. "We recycle brands that get left on the side of the road."

But the Hydrox brand has special meaning to him. As a young kid raised by parents who were Orthodox Jews, he was only permitted to eat Hydrox -- not Oreos -- because, he says, at the time, Oreos were not kosher but Hydrox were. Today, both are kosher.

The move by Leaf Brands -- which also owns trademarks to Astro Pops, Wacky Wafers and Farts Candy -- comes just two years after giant Oreo celebrated its 100th birthday. Little-known, however, is that Hydrox was the original creme-filled chocolate sandwich cookie when it debuted in 1908 -- followed four years later by Oreo.

But executives at Mondelez, which owns the Oreo brand, are hardly showing any signs of concern. "Oreo i! s America's favorite cookie," says Laurie Guzzinati, a company spokeswoman. She declined to comment specifically on the return of Hydrox. Oreo sales, which exceed $2 billion globally and $1 billion in North America, have grown double-digits in the U.S. for the past two years.

Its been years since Oreo had a genuine rival on the shelf. Kellogg stopped making Hydrox in 2002. Then, in 2008, when Hydrox turned 100, Kellogg briefly resumed distribution, but only for a limited time.

Hydrox still has an online fan page, and a few months ago, Bill Burnett, of Salina, Okla., posted this wishful note about Hydrox: "My brother and I loved them. I never got a taste for the inferior "Oreo," which was far less tasty as the wonderful Hydrox. I think I've only bought one package of them in 50 years! Bring Hydrox back again!"

In fact, says Kassoff, it's fans like Burnett who convinced him to bring back the brand. "I hear from all of them," he says. "I know millions of people are waiting for the product."

But unlike the cookies giants, which typically must sell at least $100 million worth of a brand for it to be an even modest success, Burnett says he can sell a fraction of that and do just fine.

The pricing will be roughly where Hydrox was for years: less expensive than Oreos but more expensive than store brands. If a 14-ounce package of Oreos retails for about $4; Hydrox will be $3 and store brand sandwich cremes often cost about $2, he says.

But success won't come simply. At least one brand guru says Hydrox has lots of work to do. "Oreo conveys round and is fun to say and hear. Hydrox sounds scientific and medicinal ... not appetizing at all," says Steven Addis, CEO of Addis. "Oreo has become part of the fabric of America. Like Coke. This makes it somewhat unassailable, even from a superior product."

The cookies will be made at a factory in Southern California, but Kassoff won't say where. Maybe he doesn't want the fans lining up outside the gates just yet. But lat! er this s! ummer, when the first pack rolls of the line, Kassoff has big plans for that one.

"It's mine," he says. "I'm going to sit down and share it with my family."

Hydrox cookies [Via MerlinFTP Drop](Photo11: Leaf Brands)

Thursday, May 28, 2015

Coke Climbs As Q1 Results Surpassed Low Expectations

Shares of Coca-Cola (KO) were climbing more than 3% Tuesday, as lackluster expectations were enough to turn an in-line quarter into a great one for many investors.

Coke reported first quarter adjusted earnings of 44 cents a share, in line with analysts' expectations. Revenue fell 4.2% year-over-year to $10.58 billion, just squeaking past the consensus $10.55 billion.

However, there were bright spots in the quarter: The in-line results came despite foreign exchange headwinds as a result of the strong dollar, and overall volumes rose 2%, ahead of expectations and juiced by growth in fast-growing emerging markets.

On the conference call, management said that it doesn't anticipate currency headwinds to be as severe going forward, and the company's full year plan remains intact.

Citigroup's Wendy Nicholson reiterated a Buy rating and $44 price target on the stock following the report: "KO faced its toughest YoY volume comp of the year in 1Q (to +4% in 1Q13), which had led most folks to expect 0%-1% overall volume growth in 1Q14. We are encouraged that despite a confluence of headwinds – incl. one less selling day, the shift in timing of Easter, the new soda tax in Mexico, unrest in Russia, and robust health & wellness concerns pressuring the CSDs business globally – KO managed to deliver 2 pts of global volume growth. And, while this growth was driven entirely by the stills business, we are pleased that the margin drag from the negative mix shift did not prevent KO from posting 7% organic growth in op income. All in, we consider this to be a better-than-expected start to the year, and we hope this momentum continues, especially in light of easier volume comps to come."

Main rival PepsiCo (PEP) was also trading up at recent check; it reports earnings on Thursday.

Feeling Fashionable: Urban Outfitters Gains as Wedbush Predicts Sentiment Shift

Looks like retailer Urban Outfitters (URBN) is slightly fashionable again…at least for today.

After sinking to a 52 week low on Feb. 4 and reporting a mixed fourth quarter on March 10, shares are advancing today after Morry Brown of Wedbush upgraded the price target to $46 from $44 in a note.

Brown’s increase came following a meeting with CFO Frank Conforti and Director of Investor Relations Oona McCullough, from which he emerged confident of a third-quarter turn. He writes:

1) We believe current challenges at Urban are not driven by secular trends in teen spending, but by poor product execution; 2) category expansion presents a meaningful growth opportunity in the coming years, one that is not available to most peers; and 3) fears of a potential slowdown at Anthropologie lack a catalyst and conflict both with current merchandise execution and quarter-to-date same-store sales results, which show ongoing strength at the division. Over the next three-to-six months, we expect sentiment to shift on these topics, likely driving increases in second half of 2014 estimates and valuation.

Brown also praised Urban for its category expansion opportunities, strength in e-commerce penetration and strong brands:

Beyond near-term execution and sentiment shifts, we continue to view Urban as the best-in-class specialty retailer, and one of the few that remain well positioned for longer-term growth

Shares of Urban Outfitters have gained 1.6% to $37.87 at 3:49 p.m., while Abercrombie & Fitch (ANF) has risen 0.3% to $37.24 and the Gap (GPS) has dropped 1.4% to $40.16.

Wednesday, May 27, 2015

Jefferies Lifts Price Targets on Some Top Stocks to Buy

When brokerage firms on Wall Street start to raise price targets on names that have already been doing well, investors should take note. Typically when companies are hitting on all cylinders, earnings continue to grow both sequentially and year over year. This gives Wall Street analysts the kind of confidence they need to retain their Buy ratings and raise the target price.

In a new Jefferies research report, the analysts highlight some of their top stocks to buy in multiple sectors that are doing so well that the price targets have to be moved higher. We screened their report for not only the top stocks to buy, but the stocks that are in sectors that are poised to do well in 2014. Despite the sizable rally in the S&P 500 and the Dow Jones Industrial Average, both are still down for the year. Now may still be an ideal time to scale in some investment capital to these quality names at Jefferies.

Arris Enterprises Inc. (NASDAQ: ARRS) got hit when press reports indicated that Apple may be working with Time Warner Cable and other companies on a new set-top box. The Jefferies team do not know the specifications of the device. It still may use “HDMI pass through” architecture like XBox One (and therefore will still require a cable STB to support cable content). That would bode well for Arris. The Jefferies target is lifted to $30. The Thomson/First Call estimate is $28.05. Arris closed on Friday at $27.87.

C&J Energy Services Inc. (NYSE: CJES) undertook an aggressive expansion plan for 2013. That strategy culminated in several deals during the fourth quarter and further plans for 2014. The domestic hydraulic fracturing specialist has spent the past couple of years expanding the business line and, surprisingly, building new equipment. Now with natural gas inventories plunging to five-year lows, C&J Energy is positioned to take advantage of a market where utilization is already firming. Jefferies price target holds steady at $28, and the consensus estimate is $25. Shares closed Friday at $24.50.

Discover Financial Services (NYSE: DFS) is the top pick in credit cards at Jefferies. Not only did the analysts up the numbers dramatically for the year, they also think that the rest of Wall Street is way low on modeling asset growth for the company. Lower cost Internet deposits, better performing student loans, lower charge offs and slower delinquent account repricing will support margins. Investors are paid a 1.4% dividend. Jefferies lifts its price target from $57 to $65. The consensus target is $61.96. Discover closed Friday at $56.92.

Orbital Sciences Corp.‘s (NYSE: ORB) 2013 results and 2014 outlook point to the revenue growth and high free cash flow potential of the franchise. The Jefferies analysts see opportunities for new orders, 7% revenue growth and acceleration of free cash flow, and they expect shares to continue to advance. The company develops and manufactures small and medium-class rockets and space systems for commercial, military and civil government customers. Jefferies raises its price target from $27 to $31. The consensus number is $33.17. The stock closed on Friday at $28.27.

Precision Drilling Corp. (NYSE: PDS) is Canada’s leading oilfield services firm, which provides contract drilling, well servicing and strategic support services to its customers. The company was formed as a private drilling contractor in the early 1950s and has grown on the back of fleet expansion and acquisitions, most notably the $2 billion purchase of Grey Wolf in 2008. The company pays investors a 2.1% dividend. The Jefferies price objective goes from $11 to $13. The consensus stands at $12.78. The stock closed Friday at $10.39.

Qihoo 360 Technology Co. Ltd. (NYSE: QIHU) provides Internet and mobile security products in the People’s Republic of China. Its core Internet security products include 360 Safeguard, a solution for Internet security and system optimization; 360 Antivirus, an antivirus application that uses multiple scan engines to protect users’ computers against various kinds of malware; as well as 360 Mobile Safe, a security program for the Google Android, Apple iOS and Nokia Symbian smartphone operating systems. The Jefferies price target rises from $105 to $125, and the consensus target is $94.60. Those consensus numbers may go higher as the stock closed Friday at $99.25.

When analysts sense that a stock they cover has solid upside potential, they usually feel comfortable raising the price target as the stock nears the current target. When the same analysts see business grinding sideways, they typically cut a stock to Hold as it nears or hits the current target. Clearly the Jefferies analysts have confidence, as their numbers are going higher.

Monday, May 25, 2015

A Strong Athletic Brand Racing Back After Mishap

Lululemon Athletica Inc. (LULU) is a designer, manufacturer and retailer of yoga-inspired apparel. Since its creation in 2002, the company has grown from a single store to over 250 locations in the US, Canada and Europe. Its original target market is women in their 30s, but the brand has broadly expanded to new categories including women of all ages, men, youth and focused fitness wear. Its designs have performance features and are made with technology enhanced fabrics. The high quality of its products has positioned the company as a premium brand that caters to affluent consumers.

Its marketing strategy has allowed Lululemon to attain great brand loyalty. The firm distributes its products through yoga studios and top fitness clubs and is also affiliated with yoga and fitness instructors. Thus, the company has developed great connection with its customers. This approach and the company´s adaptability to new market needs have proved right, since annual sales have risen almost six-fold since 2007.

Quality Issues and Powerful Competition

Despite its strengths, Lululemon suffered tough quality issues over the last quarters. Its heaviest misstep was the sheerness of its popular luon fabric. This defect resulted in the company´s pulling out from the market all of its luon-made items, which represent around 17% of all yoga pants. As a result, there was a shortage of these products during the first quarters, which had a significant impact on comps. The fourth quarter also showed a decline in sales with comparative same-store sales expected to be in the low-to-mid single digits. Such results hadn´t been seen since the recession, when the company reported negative comps on the first two quarters of 2009.

Moreover, an unusual January saw traffic and sales trends slow down significantly, partly due to two Polar Vortexes hitting the middle and east coasts of U.S. and Canada. Consequently, the company suffered a cut in its fourth quarter estimates and earnings per share guidance was lowered to $0.71-$0.73 from $0.78-$0.80. Nevertheless, analysts' forecast for fiscal 2014 still sees a rebound in earnings growth which is expected to raise by 17.3%.

Another factor threatening to erode Lululemon´s margins is growing competition from strong companies such as GAP (GPS), Under Armour Inc. (UA) and Nike (NKE). The hole opened by the company´s inventory shortage, and the damage the luon incident caused to the brand image, was well addressed by its rivals. In this manner, UA started producing yogawear apparel and recently launched its studio yoga wear ad campaign. Following this line, GPS opened several Athleta yogawear outlets near Lululemon locations and has partnered with yoga instructors to offer fitness classes. And , NKE is also targeting high to the women´s yoga apparel segment.

Balance Sheet and Valuation

In spite of all headwinds, Lululemon is still a fast growing and profitable company. Its balance sheet shows no debt and it has strong free cash flow, which the company is redirecting to investments in order to expand its operations to new categories. As long as the firm avoids future product missteps, the success in its new initiatives and its strong brand identity can provide Lululemon with a narrow economic moat.

A super high return on equity of 30.50 compared to the 9.0 industry median goes along with an outstanding return on capital of 135.3 relative to the 19.1 industry average. Its revenues grew 43.4 compared to rivals' average of 7.0, and earnings per share soared to 65.20, leaving the rest of the industry look weak at 13.50. Lulemon´s stocks trade at 23.40 its trailing earnings compared to 18.20 held by the industry median. Analysts' estimates forecast a growth of 16.9% and for the next five years, the company's earnings per share are expected to grow an impressive 18.4% per year. Rivals Gap and Nike on the other hand expected an increase of 13.5% and 12.3% respectively in their EPS. Therefore, although investment guru Steve Mandel (Trades, Portfolio) recently sold out, I feel strongly bullish about the Lululemon´s growth potential.

Disclosure: Vanina Egea holds no position in any stock mentioned.

About the author:Vanina EgeaA fundamental analyst at Lone Tree Analytics

Visit Vanina Egea's Website

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Sunday, May 24, 2015

47 Ronin, 50 New Highs: Stocks Cap Stellar Week With Friday Pause

Let’s talk about expectations. Specifically, let’s talk about expectations for the Keanu Reeves-led 47 Ronin. The troubled film–and that’s the word just about everyone uses to describe it–cost at least $150 million to make, and well before its release date Universal Studios knew it would be a stinker. But here’s the thing: 47 Ronin has made $11 million in its first two days of release and could end up making $50 million at the U.S. box office. No, that won’t begin to cover its costs, but again, it’s all about expectations. If the movie is what the critics say it is, $50 million might not be a bad haul.

Now consider the U.S. stock market. The Dow Jones Industrial Average rose 1.6% to 16,378.41 this week, and narrowly missed closing at a 51st new all-time high this year after it fell 0.01% today. Likewise, the S&P 500 gained 1.3% to 1,841.40, and it too missed its 45th record high by just 0.03%.

But as the year ends, it’s time to think about expectations, as in what will the next year bring. And just as what came before could color how 47 Ronin is perceived, its likely that investors will let the Dow Jones Industrial Average’s 26% gain and the S&P 500′s 29% rise, color their outlook–for the better or for the worse.

Don’t. Let the folks at Birinyi Associates explain:

Our research has also concluded that the market works on its own, not calendar, cycle. We postulate that the markets of 1982, 1990 and 2009 have four stages and that this is the exuberant phase. Perhaps our biggest surprise this year has been that we have still not reached the point in the fourth phase where the optimists triumph. At the risk of being considered an annual projection we would recommend that investors at least consider the possibility of another outstanding year.

Given that the market does not adhere to the Gregorian calendar, we have adopted the practice of forecasting (and investing) in documentable stages or steps…Analyzing the trend of the S&P, the top of its current trading range is 1,870 which we would consider as a possible target. While we will fine-tune this after all of 2013's results and data have been posted, we are comfortable, confident and most assuredly positive.

Citigroup’s Tobias Levkovich frets about a first-quarter selloff:

We continue to think that a 1Q14 correction (in the 5%-10% range) is possible given weakening EPS forward guidance trends…not to mention euphoric sentiment levels. While credit conditions remain favorable in the US, disappointment in emerging economies and a lackluster though improving Europe could hold back the earnings story. Admittedly, better hiring intentions are encouraging, plus stock buyback activity has stepped up and money has begun to flow into equity funds.

Investors, however, are showing no signs of letting up on the risk taking. Want evidence? Just look at the top-performing stocks this week. Four of the top-five come from the materials sector, which could benefit from a stronger economy. Cliffs Natural Resources (CLF), which rose 9.6% this week, Allegheny Technologies (ATI), which gained 7.7%, U.S. Steel (X), which advanced 7.7%, and Dow-exile Alcoa (AA), which finished the week up 7.6% They were joined by PulteGroup (PHM), which rose 7.8% after a delay of a Fannie Mae and Freddie Mac mortgage-fee hike was mooted.

Like I said, expectations.

Wednesday, May 20, 2015

Target: Justice Dept. investigates data breach

NEW YORK (AP) — Target said Monday that the Department of Justice is investigating the credit and debit card security breach at the retailer that's being called the second largest incident in U.S. history.

The investigation comes after the discounter revealed last week that data connected to about 40 million credit and debit card accounts was stolen between Nov. 27 and Dec. 15. The theft is exceeded only by a scam that began in 2005 involving retailer TJX Cos. It affected at least 45.7 million card users.

The Department of Justice declined to comment on whether it's investigating the breach at Target, the nation's second largest discounter. But Target said that it's cooperating with the DOJ's probe.

CYBERTRUTH: Why the Target breach won't be the last of its kind

The news came as Target also said that it is working with the U.S. Secret Service in the retailer's own investigation and that its general counsel held a conference call on Monday with state attorneys general to bring them up to date on the breach.

"Target remains committed to sharing information about the recent data breach with all who are impacted," said Molly Snyder, a Target spokeswoman, in a statement.

The moves come as Target is trying to deal with the bad publicity that's being generated by the breach during what is typically the busiest shopping season of the year. By Monday evening, more than a dozen Target customers had already filed class-action lawsuits in federal courts around the country, with some alleging Target was negligent and should have done a better job of protecting customer data.

Target has said that it told authorities and financial institutions once it became aware of the breach on Dec. 15. The company issued an apology to customers and doubled the number of workers taking calls from customers around the clock. It also offered 10% off to customers who wanted to shop in its stores on Saturday and Sunday and free credit-monitoring services to those who are affected by the issue.!

But there are early signs that some shoppers are scared off by the breach. Scotty Haywood said he plans to no longer shop at the store because he was a victim of the breach. After his wife tried to use the couple's debit card on Thursday to buy a few items at a grocery store, he said the card was denied. He said the couple knew something was wrong because they had $2,200 in the account.

"The possible savings of a few dollars (by going to Target) are nothing compared to the money that has been stolen from us," he said.

Overall, Customer Growth Partners, a retail consultancy, estimates that the number of transactions at Target fell 3% to 4% on Saturday, which is usually one of the top busiest days of the season.

"Before this incident, Target had a chance of at least a decent Christmas. Now, it will be mediocre at best," said Craig Johnson, president of Customer Growth Partners, a retail consultancy.

Meanwhile, consumer perception about the Target brand has dropped steeply since the news broke Wednesday night, according to YouGov BrandIndex, which surveys 4,300 people daily. The index ranges from 100 to negative 100 and is compiled by subtracting negative customer feedback from positive customer feedback.

Before the breach, Target's index was 26, higher than the rating of 12 of its peer group of retailers that include Wal-Mart. Now, it's negative 19.

Eric Hausman, a Target spokesman, declined to comment specifically on sales or the impact of its 10 percent offer, but said that stores "were busy."

Target, which is based in Minneapolis and has nearly 1,800 stores in the U.S. and 124 in Canada, said on Friday that it's heard of "very few" reports of fraud so far. But experts say the investigation is still in its early stages.

The retailer also said the Secret Service has asked it not to share many of the details of the probe.

How Russia and China Killed Cisco

John Chambers, the longtime CEO of Cisco Systems Inc. (NASDAQ: CSCO) made a presentation to investment analysts. It contained dozens of PowerPoint slides, but the audience only cared about one. It showed that over the past two quarters, sales in China, Russia and Brazil wrecked Cisco’s short-term, and perhaps longer term, fortunes. The business press hammered the downturn in Cisco’s prospects, as dozens of media outlets predicted that Cisco’s major opportunities had died.

At the center of Chamber’s presentation was what must be considered positive news, although it was mostly overlooked. According to Reuters, he said to reporters, ”If the U.S. does well we’ll pull the rest of the world out of this.” Many economists believe that the accelerated growth of the U.S. economy has already started and will only improve into 2014. Under those circumstances, America would resume its long-time role as the engine of demand for both business and consumer goods and services, with a ripple effect that will go worldwide. Chamber’s real message was optimistic. Russia and China appeared to be at the heart of his presentation. There were not.

Pessimistic analysts regard Cisco as a dinosaur, no matter where it does business. The company has too much competition in its big router business. And its expensive products will be replaced by ones that rely more heavily on software — more efficient and with lower costs to operate. The other trend that Chambers blamed for Cisco’s problems is falling sales of set-top boxes. As consumers move from the traditional boxes deployed by almost all cable companies to Internet-delivered content, set-top box revenue may continue to decline. On the other hand, while router technology may have advanced quickly, Cisco’s router systems remain at the core of much of the Internet’s infrastructure. Between the lines of Chamber’s forecasts was not a statement that Cisco had a product problem. Rather, it has a regional demand one. The risk, therefore, is that Chamber’s basic analysis of Cisco’s problems is wrong.

Ultimately, Russia and China will not kill Cisco. The company will die only if Chamber’s assessment of its product prospects is flawed.

Tuesday, May 19, 2015

Nissan recalling 150k SUVs for brake problem

The 2013 Infiniti JX35 and 2014 QX60 are among the crossover SUVs Nissan is recalling. The closely related Nissan JX35 is also being recalled.

NEW YORK (CNNMoney) Nissan is recalling approximately almost 152,000 Nissan and Infiniti SUVs due to a computer problem that could weaken brake performance.

In-car computers that control the anti-lock braking system may not respond correctly during light braking on rough surfaces. The result is that the vehicles can take slightly longer than expected to come to a full stop.

Anti-lock braking systems pump the brakes rapidly during hard braking to prevent the wheels from locking up, or skidding. When tires begin skidding across the pavement it becomes impossible to control a car so anti-lock braking systems are supposed to provide for safer, more controlled, stops.

Gallery - 8 collectible SUVs

The vehicles involved in the recall are some Nissan Pathfinders from the 2013 and 2014 model years as well as 2013 Infiniti JX35 and 2014 QX60 SUVs. Infiniti is Nissan's luxury division.

Can the Infiniti Q50 compete with the Germans?

Nissan (NSANF) will ask owners of effected vehicles to bring their vehicles to a Nissan or Infiniti dealer to have the ABS computer chips reprogrammed. The service will be performed at no charge. No accidents or injuries have been reported due to the problem, Nissan said.

Wednesday, May 13, 2015

Ellison brand a big winner, too, in America’s Cup

The America's Cup win is great for America and terrific for sponsor Oracle, but the biggest winner may be the billionaire owner whose personal brand just got the largest lift of all: Larry Ellison.

"Oracle is really code for Ellison," says Rob Prazmark, founder and CEO of 21 Marketing, which specializes in sports marketing. "Ellison uses sailing and his America's Cup victories to further Oracle's business relationships."

Only a handful of CEOs are as big as their brands. Phil Knight and Nike are synonymous. So are Mark Zuckerberg and Facebook. Larry Page and Google. And, of course, Steve Jobs may have been bigger than the Apple brand itself. So when a brand reaches new heights, as Oracle has with Wednesday's comeback-of-a-lifetime America's Cup win, so rises the reputation of Ellison, the billionaire behind the boat.

ORACLE'S WIN: Stunning America's Cup comeback

LARRY ELLISON: World's wealthiest underdog?

What should Ellison — and the Oracle brand — do next? Sports marketing gurus offer these suggestions:

• Timing is everything. The big tech fest for business and Internet technology honchos, Oracle OpenWorld 2013, concluded Thursday in San Francisco. What a way to end the show, with the America's Cup champs appearing at the conference keynote address. Oracle enticed folks to attend with commemorative T-shirts that were promised to the first 1,000 attendees. It also gave them the chance to have their photos taken alongside the Cup. The big win was also highlighted on the conference's blog. "If they had lost, it could have been a very bad story; but now, it is an incredible story," says Prazmark.

• Brag a little. Perhaps Oracle should consider some tablet advertisements, reminding Americans that the leader in corporate software is still the leader in yachting, says Chris Raih, founder of the sports marketing agency Zambezi. Raih suggests this headline: "Oracle: maintaining our lead in the software industry and the high seas."

• Bring the t! hrill to clients. Oracle should create some sort of America's Cup "daily experience" that brings the thrill of the victory to top clients and vendors, suggests David Schwab, senior vice president at Octagon, a sports and entertainment marketing agency. This is particularly important in markets with water access, including San Francisco, Los Angeles, New York, Chicago and Miami, he says.

• Personal brand. Not all the personal branding need be Ellison's. Oracle skipper, Jimmy Spithill, an Australia native who also led the team to victory in the last cup, is already a hot marketing item in his native country, and should now be increasingly marketable in the U.S. market, says Raih.

• Create an image. Unlike New Zealand, which cautiously sat on its seemingly insurmountable 8-1 lead in the race, the Oracle brand should now emphasize, "It's not complacent in the marketplace and pushes the outer limits of creativity and innovation," says Darcy Bouzeos, president of DLB, a sports and entertainment marketing firm

• Focus on the rich. Even after this win, the America's Cup remains a "very niche" sport that's laser-focused on the "über-wealthy" says Prazmark. Ellison and Oracle still need to remember that, whenever and wherever they flaunt this big victory.

Tuesday, May 12, 2015

Non-Bank Banks

Neil George, editor of By George, discusses non-bank banks and the Small Business Investment Incentive Act and suggests a way to aid your investments in the tech sector.

NANCY: Hi, my guest today is Neil George. Hi Neil, and thank you so much for dropping by.

NEIL: Nancy, it’s always a pleasure.

NANCY: That’s wonderful. Let’s talk about non-bank banks. When I think about non-bank banks, I think about the way they used to be back in the 1970’s and the 1980’s, and that’s not what the terminology means today.

NEIL: Well Nancy, there’s another phenomena in the marketplace that stems from a period of time in which the US was in a real pickle. You and I both remember the 1970’s. We both might have been little tykes back then…

NANCY: Yes, we were.

NEIL: But at least we remember our history. Inflation was really out of control. Interest rates were to the moon. Many people were having difficulty getting mortgages; a lot of people had one or two mortgages on their homes.

NANCY: And negative amortization mortgages.

NEIL: Even worse, and the idea – it wasn’t because people had bad credit, it was because banks really were kind of constrained and they knew with inflation in the double digits, if they made a mortgage loan, they were getting paid back in effectively less valuable dollars in the future, and what made it even worse and made the economy really go into that stagflation mode was that businesses couldn’t get loans, because again, banks were afraid to make loans and they were very fearful of the impact of inflation. Jimmy Carter, the president back then, and congress…

NANCY: The peanut guy.

NEIL: Yeah, the fellow from Georgia – no, and the naval officer.

NANCY: Right, a physicist.

NEIL: And a physicist, nuclear physicist, so a guy with a propeller head, but regardless of how people judge him and his presidency, one of the bit of legislations that he basically signed off on was the Small Business Investment Incentive Act of 1980, and what this bit of legislation did, it basically examined small and mid-sized businesses and what they needed. Needed to have access to capital, needed to have access to loans, and therefore, what this did was it enabled companies to be setup much like investment companies that were setup under the Investment Company Act of 1940. In other words, like funds.

NANCY: Right.

NEIL: Companies could set themselves up as a company and be able to make loans to businesses, particularly small to mid-sized firms, and they would not be taxed as a corporation, so they don’t have to pay any corporate income tax.

NANCY: Interesting.

NEIL: But, at the same time, the money that they would earn would be passed through to their investors. This provides two nice incentives. One is that the investor in these sorts of companies that would be funding it would be able to get a fairly good dividend, and back then it was pretty high, and today, there were a handful of these sorts of companies that are quite well and we’ll talk about a few in a moment, if you would like.

NANCY: Is there a percentage that they’re required to give back to the investors?

NEIL: No, there isn’t.

NANCY: Okay, so not like a REIT.

NEIL: It’s not like a REIT, but there is a general incentive for them to pass through, so the idea the investor gets a lot of cash flow back, but also, they get all the depreciation and all the other expenses passed through, so that part of their dividend is going to be shielded from current tax liability, so the benefit is you get a lot of interest in your dividend, and you’re not going to have to pay as much of your own income tax on that amount, so it’s a win-win all around. No double taxation and you actually get part of your dividend is tax shielded, so there have been a variety of companies that have used this formula to be able to operate, and one of the ones, since we’re in San Francisco, not too far away from here is Paolo Alto, which is sort of the tech mecca of the US.

NANCY: Exactly, Stanford University.

NEIL: And you have a lot of guys in hoodies in their parent’s garages that are coming up with the gizmos that you and I and the rest of the world are going to want to have or got to have, and we’ll stand in line at various stores to buy these little gizmos.

NANCY: And pay a premium for them.

NEIL: And we’ll pay premium, or it might very well be the next wiz bang thing on the internet, or who knows that it’s going to be, but tech is one of those things that Northern California is famous for. Well, there’s a firm that’s headquartered in Paolo Alto right in the thick, and there’s a – the guys running this company have really gotten to know all those guys in the hoodies in the garages, and they’ve been able to identify the guys that are going to make it and not, and so their process is they will basically come in, they will help examine the company, and a lot of them are everything from small to already established private companies in the technology world, but these companies need funding, and therefore, they will make loans to them.

NANCY: But not like VC’s where they take out part of the equity.

NEIL: No, but what they do is they do have an equity incentive, so the idea that the companies have to pay back their loans, but they also get to participate in the equity through warrants, so when the companies go public and cash out, they’ll get a piece of the action, as well as their loans repaid, and they’ve been doing this over and over. Now, the company in Paolo Alto is a company called Hercules Growth Technology Corporations, HTGC, and it’s a company that has had a fairly good track record. Some companies, like, you might remember Facebook.

NANCY: Yes, I might have heard of that.

NEIL: You might have heard of Facebook. Well, Facebook came to the market about a year ago, and one fellow with the hoodie in the garage…

NANCY: Right, Zuckerberg.

NEIL: Mr. Zuckerberg, who still likes his sweatshirts. He was able to make about $18 billion dollars out of it. Now, investors, subsequently, they’re just getting their money back kind of.

NANCY: Right, a year later.

NEIL: A year later, but Hercules got their money up front, just like Mr. Zuckerberg. Another company you might have heard of, Google.

NANCY: Yes.

NEIL: That one’s kind of famous now. Well, years ago, it wasn’t so famous, and the idea that those are two examples, and there’s a myriad of other investments that this company has helped to fund with these sort of loans. Now, one of the other great benefits, Nancy, is that, as you know, people at the Money Show are always interested in income, and income is one of those things that retirees, as well as people looking to build a portfolio really needs, and so Hercules throws off a lot of cash and the current dividend is about 8% right now.

NANCY: Very healthy.

NEIL: So the idea, if you like the idea of investing in technology and you like the idea of being able to cash in on what’s next and what’s going to be really big, but you also want to make sure you’re going to be paid and get a good dividend, Hercules is one I really think people ought to take a look at.

NANCY: Fascinating. Thank you, Neil.

NEIL: Thanks Nancy.

NANCY: And thanks for being with us on the MoneyShow.com Video Network.

Sunday, May 10, 2015

InSite Vision Received Notice of Allowance from USPTO for Patent on DuraSiteÂ® 2 Ophthalmic Drug Delivery System (OTCMKTS:INSV, OTCMKTS:EQLB)

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InSite Vision Incorporated (INSV)

Today, INSV surged (+2.77%) up +0.009 at $.334 with 24,100 shares in play thus far (ref. google finance Delayed: 11:27AM EDT July 8, 2013).

InSite Vision Incorporated previously reported it has received a Notice of Allowance from the United States Patent and Trademark Office (USPTO) on its DuraSite® 2 next-generation enhanced drug delivery system. DuraSite 2 provides a broad platform for developing topically delivered ocular drugs with enhanced tissue penetration in order to improve efficacy and dosing convenience. The patent is expected to provide protection to 2029 for both the delivery system and the drugs that are formulated with DuraSite 2.

InSite Vision Incorporated (INSV) 5 day chart:

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eqlb

EQ Labs, Inc. (EQLB)

Today (July 8), EQ Labs, Inc. (OTCMKTS:EQLB) (www.drinkeq.com) had surged (+8.70%) up +0.0004 at $.0050 with 125,000 shares in play thus far (ref. google finance Delayed: 12:43PM EDT July 8, 2013). Now at the current price of $.0050, EQLB would be considered to have experienced a (+733.33%) gain if compared to the 52 week low of $.0006.

EQ Labs, Inc. manufactures and markets energy drink products in the United States and Latin America. The company offers EQ Smart Energy Drink, in an effervescent tablet form that provides an instant energy drink once added to a beverage of choice. EQ Labs, Inc. distributes its products through national and regional distributors.

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To view EQ Labs, Inc. video click link http://crwetube.com/media/eq-labs-inc-and-its-revolutionary-eq-smart-energy-.

EQ Labs, Inc. (EQLB) 5d chart:

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