As the debate continues over what's causing health-care cost growth to slow -- Obamacare or the poor economy -- we're seeing another catalyst have a big impact: the patent cliff.
Drug spending fell for the first time in 55 years, but not because Americans are living healthier. Simply put, some�high-profile drugs just got a lot cheaper.
This video discuses why the patent cliff, while a huge threat to the pharmaceutical industry, is a huge opportunity to decrease costs for one of the largest drivers of the national debt. Our health-care analyst takes a look at why generic-drug makers aren't the obvious home-run investment they would appear, despite strong industry tailwinds.
Obamacare will undoubtedly have far-reaching effects. The Motley Fool's new free report, "Everything You Need to Know About Obamacare," lets you know how your health insurance, your taxes, and your portfolio will be affected. Click here to read more.�
Follow David on Twitter:�@MotleyDavid.
Hot Companies To Invest In Right Now: Cloud Peak Energy Inc(CLD)
Cloud Peak Energy Inc., through its subsidiaries, engages in coal mining operations in the Powder River Basin of the United States. It produces sub-bituminous steam coal with low sulfur content for electric utilities and industrial customers. The company owns and operates Antelope surface coal mine located to the south of Gillette, Wyoming; the Cordero Rojo surface coal mine located to the south of Gillette, Wyoming; and the Spring Creek surface coal mine located in Montana. It also owns a 50% interest in the Decker surface coal mine located in Montana. As of December 31, 2010, it had approximately 970 million tons of proven and probable reserves. The company was founded in 1993 and is headquartered in Gillette, Wyoming.
Advisors' Opinion:- [By Ben Levisohn]
Until mid-2014 the best performers had been the thermal producers Alliance Resource Partners (ARLP) Cloud Peak Energy (CLD) and Consol Energy (CNX), but since nat gas prices disappointed in July, there�� no safe equity in the sector. With booming supplies of nat gas, a demand still playing catch up, without a cold winter gas prices could be weak into 2015.
- [By Ben Levisohn]
Heading into the 2Q14 earnings season, we think the coal sector continues to be unloved with met coal prices close to bottom while steam coal prices are slightly cooling off after a strong rally during 1Q14. Similar to 1Q14, the two major challenges for coal producers remain weak met coal pricing and rail service limiting steam coal volume uptick. On the positive side, since 1Q14, we have gotten about 16 MTPA of global met coal production cuts, which are slowly flowing through the system but could take another three months to drive prices higher. On the other hand, rail service (BNSF and CSX) challenges continue, and we do not expect to see any major improvement through 2H14, which is later than expected during 1Q14, when some producers indicated 3Q14 normalization. We expect a majority of earnings calls to be focused on those two themes over and above company-specific issues (asset sales/divestitures, cost control, and balance sheet management). While still in the early days, we will look for any color on the coal industry’s preparedness for eventual implementation of GHG regulation announced by the EPA in early June. Within our coal coverage, we are lowering our 2014 EBITDA estimates by an average of 12% for the group, while our 2015��016 estimates are largely unchanged. In addition, we are adjusting our price targets for Cloud Peak Energy (CLD) to $25 from $26 and Walter Energy (WLT) to $7.50 from $8.50 as we update our coal price deck for 2Q14 actuals and the 3Q14 met coal benchmark settlement, as well as adjust for rail service issues in the Powder River Basin. In terms of our overall coal coverage, we continue to prefer steam coal names and/or low-cost met coal assets with solid balance sheets. Our Outperform rated names include Arch Coal, Peabody Energy, Cloud Peak Energy, and Consol Energy (CNX).
Top 10 Cheap Stocks To Own Right Now: Wendy's/Arby's Group Inc.(WEN)
The Wendy's Company operates as a quick-service hamburger company in the United States. The company, through its subsidiary, Wendy's International, Inc., operates as a franchisor of the Wendy's restaurant system. As of December 26, 2011, the Wendy's system comprised approximately 6,500 franchise and company restaurants in the United States and the United States territories, as well as in 26 other countries worldwide. The company was formerly known as Wendy's/Arby's Group, Inc. and changed its name to The Wendy's Company in July 2011. The Wendy's Company was founded in 1884 and is headquartered in Dublin, Ohio.
Advisors' Opinion:- [By MONEYMORNING]
His greatest success has been with The Wendy's Co. (Nasdaq: WEN), which has enjoyed a stunning 97% gain since Peltz began engineering changes to the fast food chain in mid-2011.
- [By Tamara Rutter]
Breakfast is big business for fast-food chains. However, as Wendy's (NASDAQ: WEN ) recently emphasized, it's a tough business as well. It raised the white flag recently, saying it would reduce the number of locations offering breakfast to between 300 and 400, down from about 850, according to Bloomberg.
- [By Patrick M. Sheridan]
Workers from fast food giants like McDonald's (MCD, Fortune 500), Burger King (BKW), Wendy's (WEN) and Yum! Brands (YUM, Fortune 500), owner of KFC, have been walking of their jobs, calling on employers to pay them a minimum wage of $15 an hour and allow them to form unions without retaliation.
Top 10 Cheap Stocks To Own Right Now: Bank of America Corporation(BAC)
Bank of America Corporation, a financial holding company, provides banking and nonbanking financial services and products to individuals, small- and middle-market businesses, large corporations, and governments in the United States and internationally. The company?s Deposits segment generates savings accounts, money market savings accounts, certificate of deposits, and checking accounts; and Global Card Services segment provides the U.S. consumer and business card, consumer lending, international card and debit card services. Its Home Loans & Insurance segment offers consumer real estate products and services, including mortgage loans, reverse mortgages, home equity lines of credit, and home equity loans. It also provides property, disability, and credit insurance. The company?s Global Commercial Banking segment offers lending products, including commercial loans and commitment facilities, real estate lending, leasing, trade finance, short-term credit, asset-based lending, and indirect consumer loans; and capital management and treasury solutions, such as treasury management, foreign exchange, and short-term investing options. Its Global Banking & Markets segment provides financial products, advisory services, settlement, and custody services; debt and equity underwriting and distribution, merger-related advisory services, and risk management products; and integrated working capital management and treasury solutions. The company?s Global Wealth & Investment Management segment offers investment and brokerage services, estate management, financial planning services, fiduciary management, credit and banking expertise, and asset management products. Bank of America Corporation serves customers through a network of approximately 5,900 banking centers and 18,000 automated teller machines. It was formerly known as NationsBank Corporation and changed its name on October 1, 1998. Bank of America Corporation was founded in 1874 and is based in Charlott e, North Carolina.
Advisors' Opinion:- [By John Divine]
Financials also performed well today, and Bank of America (NYSE: BAC ) was no exception, trading 3% higher. Helping the stock in its ascent was an upgrade from Morgan Stanley, which gave shares an overweight rating and a $16 price target, implying a roughly 33% upside from today's closing price. Though investors were unimpressed with B of A's most recent quarter, the time and money it's put into shoring up its balance sheet and settling legal spats are starting to pay off.
- [By Anders Bylund]
Pair this fountain of cash with an admittedly not-so-buoyant history of dividend increases, and you'll see that HP spent just 10.7% of its free cash to fuel that 2.4% dividend yield. That's the third-lowest cash-payout ratio on the Dow, where financial specialists are always rolling in piles of fresh cash. The lowest cash ratio, for reference, goes to Bank of America (NYSE: BAC ) -- a paltry 6.8% of its free cash flows go to income investors. But the megabank is still waiting for government approval to raise its payouts, and most of its business takes place below the free-cash-flow line on its enormously complicated financial statements. It's a very different situation at HP, where cash flows form the most important bottom line of all, and no regulator is keeping its dividend policies back.
- [By Dividend Growth Investor]
Another example includes financial institutions such as Bank of America (BAC), Citigroup (C ), Wachovia and US Bancorp (USB) which were regarded as safe blue-chips by investors for many years. These companies managed to boost distributions for several decades, and could be found on the dividend aristocrats lists. In fact, these companies exemplified the characteristics of the perfect dividend growth stocks, since they not only provided high yields but also grew distributions at above average rates. While the financial crisis of 2007 -2009 proved that this was all based on financial alchemy, investors who sold after dividend cuts and reinvested proceeds in other income producing securities did fairly well.
- [By Louis Navellier]
U.S. financial giant Bank of America (BAC) has been on the up-and-up lately, having risen over 20% in the past quarter alone. With its next earnings release coming up, is now the time to revise my long-standing bearishness against banks?
Top 10 Cheap Stocks To Own Right Now: UnitedHealth Group Incorporated(UNH)
UnitedHealth Group Incorporated provides healthcare services in the United States. Its Health Benefits segment offers consumer-oriented health benefit plans and services to national employers, public sector employers, mid-sized employers, small businesses, and individuals; and non-employer based insurance options for purchase by individuals. It also provides health and well-being services for individuals aged 50 and older; and for services dealing with chronic disease and other specialized issues for older individuals, as well as health plans for the beneficiaries of acute and long-term care Medicaid plans. This segment offers its services through a network of 730,000 physicians and other health care professionals, and 5,300 hospitals. Its OptumHealth segment provides health, financial, and ancillary services and products that assist consumers through personalized health management solutions; benefit administration, and clinical and network management; health-based financi al services; behavioral solutions; and specialty benefits, such as dental, vision, life, critical illness, short-term disability, and stop-loss product offerings. The company?s Ingenix segment offers database and data management services, software products, publications, consulting and actuarial services, business process outsourcing services, and pharmaceutical data consulting and research services. Its Prescription Solutions segment provides integrated pharmacy benefit management services comprising retail network pharmacy contracting and management, claims processing, mail order pharmacy services, specialty pharmacy, benefit design consultation, rebate contracting and management, drug utilization review, formulary management programs, disease therapy management, and adherence programs to employer groups, union trusts, managed care organizations, Medicare-contracted plans, Medicaid plans, and third party administrators. The company was founded in 1974 and is based in Minne tonka, Minnesota.
Advisors' Opinion:- [By Travis Hoium]
On the earnings front, UnitedHealth Group (NYSE: UNH ) is up 6.4% after reporting a surprisingly strong second quarter. Revenue jumped 12% to $30.4 billion, while net income rose to $1.44 billion, or $1.40 per share. The big driver was an increase in patients covered, which should continue under Obamacare next year. The company covered 89.2 million people as of June 30, up from 76.6 million a year ago.�
- [By Dimitra DeFotis]
Apartment Invest & Management (AIV)
Ameriprise (AMP)
Edison International (EIX)
Host Hotels & Resorts (HST)
Kimco Realty (KIM)
Kroger (KR)
Lincoln National (LNC)
Newfield Exploration (NFX)
Republic Services (RSG)
UnitedHealth (UNH)
Verizon (VZ)
Wells Fargo (WFC)
WellPoint (WLP)
Wyndham Worldwide (WYN)
Xcel Energy Utilities (XEL)
Top 10 Cheap Stocks To Own Right Now: LifePoint Hospitals Inc.(LPNT)
LifePoint Hospitals Inc., through its subsidiaries, operates general acute care hospitals in non-urban communities in the United States. The company?s hospitals provide a range of medical and surgical services comprising general surgery, internal medicine, obstetrics, emergency room care, radiology, oncology, diagnostic care, coronary care, rehabilitation services, and pediatric services, as well as specialized services, such as open-heart surgery, skilled nursing, psychiatric care, and neuro-surgery. Its hospitals also offer outpatient services, including one-day surgery, laboratory, x-ray, respiratory therapy, imaging, sports medicine, and lithotripsy. As of December 31, 2009, LifePoint Hospitals owned or leased 47 hospitals with a total of 5,552 licensed beds in 17 states. The company was founded in 1997 and is headquartered in Brentwood, Tennessee. Lifepoint Hospitals Inc. (NasdaqNM:LPNT) operates independently of HCA Inc. as of May 11, 1999.
Advisors' Opinion:- [By Ben Levisohn]
Yesterday afternoon, Pennsylvania announced that it would use federal dollars to pay private insurers to cover eligible Pennsylvanians. UBS analysts A.J. Rice and Jailendra Singh think Community Health Systems (CYH), Tenet Healthcare (THC) and LifePoint Hospitals (LPNT) stand to benefit the most from the deal:
- [By Keith Speights]
The fun wasn't just limited to the big three hospital operators. Lifepoint Hospitals (NASDAQ: LPNT ) stock jumped 5% on the CMS news, reflecting a $109 million market cap expansion. Likewise, Vanguard Health Systems (NYSE: VHS ) shares climbed 5%, bumping its market cap up by�$55 million.
Top 10 Cheap Stocks To Own Right Now: Capstone Turbine Corporation(CPST)
Capstone Turbine Corporation develops, manufactures, markets, and services turbine generator sets and related parts for use in stationary distributed power generation applications. Its stationary distributed power generation applications include cogeneration combined heat and power (CHP), integrated (CHP), resource recovery, and secure power, as well as combined cooling, heat, and power; and its products are used as battery charging generators for hybrid electric vehicle applications. The company primarily offers microturbine units, subassemblies, and components. It also provides various accessories, including rotary gas compressors with digital controls, heat recovery modules for CHP applications, dual mode controllers that allow automatic transition between grid connect and stand-alone modes, batteries with digital controls for stand-alone/dual-mode operations, power servers for multipacked installations, and protocol converters for Internet access, as well as frames, ex haust ducting, and installation hardware. Further, it remanufactures microturbine engines; and provides after-market parts and services, scheduled and unscheduled maintenance, and factory and on-site training services. The company?s microturbines can be fueled by various sources, including natural gas, propane, sour gas, landfill or digester gas, kerosene, diesel, and biodiesel. It primarily sells its products directly to end users, as well as through distributors in North America, Asia, Australia, Europe, the Russian Federation, and South America. Capstone Turbine Corporation was founded in 1988 and is based in Chatsworth, California.
Advisors' Opinion:- [By Tyler Crowe and Aimee Duffy]
Over the past couple weeks Capstone Turbine (NASDAQ: CPST ) shares have launched into orbit on the news that the company had secured several orders for its microturbines. But 40% in a month? On the surface, it seems a bit silly that a company could gain that much on a couple news stories about sales. For a company like Capstone, which has struggled with sales, this kind of news is exactly what shareholders were looking for.
- [By Selena Maranjian]
Fisher reduced its stake in lots of companies, including Capstone Turbine (NASDAQ: CPST ) and Nokia (NYSE: NOK ) . Capstone is a smallish company, making low-emission microturbines used in power generation. Its top line has been growing by double digits over the past few years, and it's poised to profit from huge interest in shale oil, but it remains in the red. Still, it has recently announced a bunch of promising deals and some think the many folks short the stock will end up burned.
Top 10 Cheap Stocks To Own Right Now: S&P GSCI(GD)
General Dynamics Corporation, an aerospace and defense company, provides business aviation; combat vehicles, weapons systems, and munitions; military and commercial shipbuilding; and communications and information technology products and services worldwide. Its Aerospace group designs, manufactures, and outfits various large and mid-cabin business-jet aircraft; provides maintenance, repair work, fixed-based operations, and aircraft management services; and performs aircraft completions for aircraft. The company?s Combat Systems group offers tracked and wheeled military vehicles, weapons systems, and munitions. Its product lines include wheeled combat and tactical vehicles; battle tanks and infantry vehicles; munitions and propellant; rockets and gun systems; and axle and drivetrain components and aftermarket parts. This group also manufactures and supplies engineered axles, suspensions, and brakes for heavy-load vehicles for military and commercial customers. The company Advisors' Opinion:
- [By Rex Moore]
The Navy League's Sea-Air-Space Exposition, the largest maritime expo in the U.S., brings together dozens of defense contractors and military decision-makers. Our Rex Moore was at the event in National Harbor, Md., and saw demonstrations of several technologies. In the following video, he shows us how General Dynamics' (NYSE: GD ) new dry combat submersibles will deliver special operations to dry land in comfort.
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