Wednesday Closing Bell: Markets Rise as Investors Buy the Dip

November 13, 2013: U.S. equity markets opened lower again Wednesday morning but investors apparently decided to buy the dip today, raising indexes to the upside later in the day. The Treasury reported that the U.S. budget deficit is shrinking although it remains massive. That also lifted equities late in the day.

European and Asian markets closed lower today while Latin American markets closed higher.

Thursday's calendar includes speeches by Fed Vice-Chairman Janet Yellen and Philadelphia Fed President Charles Plosser and the following scheduled data releases and events (all times Eastern):

8:30 a.m. – International trade 8:30 a.m. – New claims for unemployment benefits 8:30 a.m. – Productivity and costs 10:30 a.m. – EIA weekly natural gas storage report 11:00 a.m. – EIA weekly petroleum status report 1:00 p.m. – 30-year bond auction 4:30 p.m. – Fed balance sheet and money supply

Here are the closing bell levels for Wednesday:

S&P500 1782.00 (+14.31; +0.81%) DJIA 15821.63 (+70.96; +0.45%) NASDAQ 3965.58 (+45.66; +1.16%) 10YR TNOTE 2.737% (+0.34375) Gold $1,268.40 (-2.80; -0.2%) WTI Crude oil $94.19 (+1.15; +1.2%) Euro/Dollar: 1.3462 (+0.0027; +0.19%)

Big Earnings Movers: Macy's Inc. (NYSE: M) is up 9.4% at $50.70 after clearing a low bar. Canadian Solar Inc. (NASDAQ: CSIQ) is up 13.8% at $32.12 on solid earnings and rising margins. Health Management Associates Inc. (NYSE: HMA) is up 5.6% at $13.23. NQ Mobile Inc. (NYSE: NQ) is down 8.8% at $13.05 after failing to calm fears arising from short seller attack.

Stocks on the Move: Chegg Inc. (NYSE: CHGG) is down 21.8% at $9.77 after the company's IPO today. USEC Inc. (NYSE: USU) is up 57.2% at $XX after the U.S. left duties in place on imports of French low-enriched uranium. James River Coal Co. (NASDAQ: JRCC) is up 19.5% at $1.41.

In all, 140 NYSE stocks put up new 52-week highs today, while 47 stocks posted new lows.

Windows Phone 8.1 supports bigger and faster phones

Windows Phone 8.1 is a small update that will benefit big phones.

NEW YORK (CNNMoney) Count Microsoft in on the giant phone trend.

When Windows Phone 8.1 hits devices at the end of the month, MIcrosoft's mobile operating system will get support for zippy quad-core processors and 1080p high-definition screens. That means Windows Phone devices will be able to sport five-inch, Apple (AAPL, Fortune 500) iPhone-like retina-grade displays. It also means that we'll eventually see a Windows Phone phablet.

The push for bigger displays also means that more live tiles can fit on the screen, and big phones running Windows Phone 8.1 will be able to add an extra column of tiles to its home screen.

In its previous iteration, Windows Phone 8 only allowed for slower dual-core processors and less-rich 720p screens. That meant Windows Phone devices couldn't participate in the move towards gigantic phones.

Related story: Nokia's new Lumia packs a 41-megapixel camera

The most universal change to Windows Phone 8.1 is that Microsoft (MSFT, Fortune 500) has added a multitasking interface to the operating system for quick app switching. For those who have used or seen how multitasking in iOS 7 works, Microsoft's implementation isn't all that different. Hold down the back button, and you're transitioned to a screen where each open app is represented as a card that you can tap to close.

Best Medical Companies To Watch In Right Now

And then there are the more minor updates. It will be easier to use your phone as a wireless hotspot, allowing you to use Bluetooth to automatically set things up. You can -- finally -- lock the orientation of the screen so that it doesn't keep rotating when you're lying down. And Windows Phone 8.1 will automatically detect when you're driving, and it can automatically send replies to text messages.

Microsoft says there are other tweaks and improvements, but aside from claims of improved overall performance, they're things users won't notice.

The free Windows Phone update will start popping up on the first devices sometime in the next few weeks, but the time frame for which phones get it depends on which phone you have, and what carrier your signed up with.

Are Dreamliner Problems Affecting Boeing?

With shares of Boeing (NYSE:BA) trading around $117, is BA an OUTPERFORM, WAIT AND SEE. or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework.

T = Trends for a Stock’s Movement

Boeing is an aerospace company. It focuses primarily on engineering, information technology, research and development, test and evaluation, technology strategy development, environmental remediation management, and intellectual property management. The company operates in five segments: Commercial Airplanes, Boeing Military Aircraft, Network & Space Systems, Global Services & Support, and Boeing Capital Corp.

Boeing is facing more concerns over its 787 Dreamliner. Polish airline LOT was forced to land a 787 in Iceland on Sunday because of an "air identification system fault," Reuters reports. LOT has faced several difficulties with its Boeing 787s, including two flights that were delayed last week when it was discovered that the craft lacked gas filters. Norwegian airline Norwegian Air Shuttle also took one of its Dreamliners out of service over the weekend and has asked Boeing to repair the craft after it suffered repeated breakdowns. LOT is demanding compensation from Boeing over losses caused by the 787′s mechanical issues.

T = Technicals on the Stock Chart Are Strong

Boeing stock has been flying higher in recent quarters. The stock is now trading at all-time highs and looks poised to continue. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Boeing is trading above its rising key averages, which signals neutral to bullish price action in the near term.

Source: Thinkorswim

Taking a look at the implied volatility and implied volatility skew levels of Boeing options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
Boeing Options	28.42%	96%	95%

What does this mean? This means that investors or traders are buying a very significant amount of call and put options contracts as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
October Options	Flat	Average
November Options	Flat	Average

As of Monday, there is average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a very significant amount of call and put option contracts and are leaning neutral to bullish over the next two months.

E = Earnings Are Increasing Quarter Over Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Boeing’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Boeing look like and more importantly, how did the markets like these numbers?

	2013 Q2	2013 Q1	Best Small Cap Companies To Invest In Right Now 2012 Q4	2012 Q3
Earnings Growth (Y-O-Y)	11.02%	18.03%	-30.91%	-7.53%
Revenue Growth (Y-O-Y)	9.05%	-2.53%	14.05%	12.87%
Earnings Reaction	-0.77%	3.00%	1.27%	-0.15%

Boeing has seen mixed earnings and rising revenue figures over the last four quarters. From these numbers, the markets have had conflicting feelings about Boeing’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has Boeing stock done relative to its peers, Lockheed Martin (NYSE:LMT), Spirit Aerosystems (NYSE:SPR), and Northrop Grumman (NYSE:NOC), and sector?

	Boeing	Lockheed Martin	Spirit Aerosystems	Northrop Grumman	Sector
Year-to-Date Return	55.93%	38.43%	43.13%	41.36%	40.27%

Boeing has been a relative performance leader, year to date.

Conclusion

Boeing is an aerospace company and provider of aircrafts and related products and services to corporations and governments worldwide. The company is facing more concerns with its 787 Dreamliner. However, the stock has been surging higher and is currently trading near all-time high prices. Over the last four quarters, earnings have been mixed while revenues have been rising, which has produced conflicting feelings among investors. Relative to its peers and sector, Boeing has been a year-to-date performance leader. Look for Boeing to continue to OUTPERFORM.

Before Buying OmniVision, Look Both Ways

NEW YORK (TheStreet) -- Since reporting fiscal first-quarter earnings results that disappointed the Street, shares of OmniVision (OVTI), which were already in a downtrend, have lost another 17%.

Understandably, OmniVision bulls insist that the stock is oversold, while "observers" are debating whether to take a closer "peek" at a possible turnaround candidate.

Although the valuation does look interesting here, I would be careful about catching -- what might prove to be -- a falling knife.

This is not the first time this company has taken some bruises. While OmniVision, which has a strong position in the image-sensor market, has benefited from its ties to Apple (AAPL), the company has also experienced some volatile price swings. After this recent selloff, it's anyone's guess where this stock is heading next, especially in light of what I believe was a decent quarter. First things first: Given the weakness we have seen in mobile handset shipments, that OmniVision was able to grow revenue by close to 45% year over year was pretty impressive. Plus, the fact that revenue advanced 11% sequentially amid a low ASP, or average selling price, environment was equally remarkable. Unfortunately though, OmniVision still didn't do enough to please the Street -- which had modeled for an extra 2% to 5% growth (according to some estimates). Now, for a little more context, consider that Qualcomm (QCOM), which is the leader among semiconductors in the mobile/wireless business, is coming off a quarter during which revenue advanced 35% year over year. In the same category, Broadcom (BRCM) just posted 7% revenue growth, which fell short of Street estimates by nearly 10%. Yet, neither Qualcomm nor Broadcom have seen their stocks erode to the degree of OmniVision. This is even though all three companies are dealing with the same fears of high-end mobile device saturation. By that logic, investors are betting that OmniVision's 17% decline in the stock was an overreaction. It very well may be. But there's one key difference. As has been the case for quite some time, OmniVision continues to suffer from weak leverage. Also, profitability hasn't always been strong, which explains the company's history of volatility.

Again this quarter, gross margins, which declined by almost 2% year over year, reminded analysts of just how competitive OmniVision's market has become. Not to mention, management didn't help matters by issuing guidance that was more than 7% below estimates, effectively confirming reasons for the panic.

Now, I do understand that management didn't want to set expectations too high and set the company up to fail. But it's worth asking if OmniVision's relationship with Apple is as strong as previously perceived?

To be fair, I don't have sufficient data to model how much revenue growth OmniVision should generate from Apple's recent launch of the iPhone 5S and the 5C. But looking back at OminiVision's fiscal second-quarter of 2013 (November quarter 2012), the company posted an almost 80% jump in revenue, helped (in part) by a 62% increase in device shipments. What I also know is that, OmniVision's second-quarter performance followed Apple's launch of the original iPhone 5 and the iPad mini last September.

But understand, I'm not suggesting that OmniVision is guaranteed to have a blowout quarter. Nor am I suggesting that management has no clue what it's doing. But I do see several catalysts to suspect that management may be low-balling guidance just a bit, especially if Apple announces a deal with China Mobile (CHL). The other thing to consider is that, Avago (AVGO), which is another Apple supplier, recently raised guidance -- presumably, in anticipation of better-than-expected demand from the iPhone launch. So far, both the iPhone 5S and 5C have received better-than-expected reviews, relative to the initial downbeat response by the Street. What this means is that there is no clear answer as to what OminiVision's management might be thinking. However, from a pure valuation play, I do see a possible bounce in the stock from the 17% decline. And if Apple does contribute to a recovery in ASPs, which would then dispel fears of high-end device saturation, OminiVision stock can head back toward the $18 to $20 range. But let me remind you of the volatile nature of this company. I would suggest you look both ways before crossing that bridge.

At the time of publication, the author was long AAPL.

Follow @saintssense

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Richard Saintvilus is a co-founder of StockSaints.com where he serves as CEO and editor-in-chief. After 20 years in the IT industry, including 5 years as a high school computer teacher, Saintvilus decided his second act would be as a stock analyst - bringing logic from an investor's point of view. His goal is to remove the complicated aspect of investing and present it to readers in a way that makes sense. His background in engineering has provided him with strong analytical skills. That, along with 15 years of trading and investing, has given him the tools needed to assess equities and appraise value. Richard is a Warren Buffett disciple who bases investment decisions on the quality of a company's management, growth aspects, return on equity, and price-to-earnings ratio. His work has been featured on CNBC, Yahoo! Finance, MSN Money, Forbes, Motley Fool and numerous other outlets. Follow @saintssense

What Do These Factors Say About Sprint’s Stock?

With shares of Sprint (NYSE:S) trading around $7, is S an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock's Movement

Sprint offers wireless and landline communications products and services to individuals and businesses in the United States. Through its two segments, Wireless and Wireline, it offers voice and data transmission services to subscribers in all 50 states, Puerto Rico, and the United States Virgin Islands under the Sprint corporate brand, which includes its retail brands of Sprint, Nextel, Boost Mobile, Virgin Mobile, and Assurance Wireless. An increasing share of the population is opting for these communications products and services, fueling profits for Sprint.

Sprint posted earnings recently and the company reported net losses of $1.6 billion, up from $1.4 billion a year earlier. The company was hurt by the $623 million it cost to close Nextel, which also cost Sprint 1.05 million subscribers. However, revenue increased to its highest point ever of $7.2 billion, and the company has big plans for the cash it's getting from SoftBank and wireless holdings from Clearwire.

T = Technicals on the Stock Chart are Strong

Sprint stock has seen a strong bid in the last couple of years. The stock is now trading at prices not seen for several years. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Sprint is trading slightly above its rising key averages which signal neutral to bullish price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of Sprint options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
Sprint Options	42.32%	50%	48%

What does this mean? This means that investors or traders are buying a significant amount of call and put options contracts, as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
September Options	Flat	Average
October Options	Flat	10 Best Tech Stocks For 2014 Average

As of today, there is an average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a significant amount of call and put option contracts and are leaning neutral to bullish over the next two months.

On the next page, let's take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Mixed Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Sprint's stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Sprint look like and more importantly, how did the markets like these numbers?

	2013 Q2	2013 Q1	2012 Q4	2012 Q3
Earnings Growth (Y-O-Y)	-15.21%	27.59%	-1.22%	-160.00%
Revenue Growth (Y-O-Y)	0.31%	0.68%	3.24%	5.16%
Earnings Reaction	7.31%	-0.14%	-0.51%	-1.77%

Sprint has seen decreasing earnings and increasing revenue figures over the last four quarters. From these numbers, the markets have been excited about Sprint's recent earnings announcement.

P = Excellent Relative Performance Versus Peers and Sector

How has Sprint stock done relative to its peers, AT&T (NYSE:T), Verizon (NYSE:VZ), T-Mobile (NASDAQ:TMUS), and sector?

	Sprint	AT&T	Verizon	T-Mobile	Sector
Year-to-Date Return	23.42%	-0.24%	9.71%	41.28%	17.97%

Sprint has been a relative performance leader, year-to-date.

Conclusion

Sprint provides communications services and technology to a wide variety of consumers and companies in the United States and its territories. The street is excited about a recent earnings announcement. The stock is currently trading at high prices not seen for several years. Over the last four quarters, earnings have been decreasing while revenue figures have been increasing which has left investors with mixed feelings. Relative to its peers and sector, Sprint has been a year-to-date performance leader. Look for Sprint to OUTPERFORM.

Is Akamai Technologies a Worthwhile Investment?

With shares of Akamai Technologies (NASDAQ:AKAM) trading around $42, is AKAM an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Akamai Technologies provides content delivery and cloud infrastructure services for the delivery of content and applications over the Internet. The company's solutions range from delivery of conventional content on websites, to tools that support the delivery and operation of cloud-based applications, to live and on-demand streaming video capabilities all designed to help its customers interact with people accessing the Internet from myriad devices and locations around the world.

The company offers five solutions designed to meet the online business needs of its customers: Terra, Aqua, Sola, Kona and Aura. Cloud computing and infrastructure are a relatively new technology that is being adopted by major companies at an increasing rate. This technology is still in its early stages of adoption in the United States and as companies worldwide begin to harness its power, Akamai Technologies stands to see explosive profits. Through its solutions, Akamai Technologies will continue to provide innovative products to businesses participating in a multitude of growing industries around the world.

T = Technicals on the Stock Chart are Strong

Akamai Technologies stock has seen a solid uptrend over the last couple of years. Currently, the stock is getting reading to see 52-week highs on positive earnings news. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Akamai Technologies is trading above its rising key averages which signal neutral to bullish price action in the near-term.

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(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of Akamai Technologies options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
Akamai Technologies Options	27%	0%	0%

What does this mean? This means that investors or traders are buying a very small amount of call and put options contracts, as compared to the last 30 and 90 trading days.

	Put IV Skew	Top Blue Chip Stocks For 2014 Call IV Skew
May Options	Flat	Average
June Options	Flat	Average

As of today, there is an average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a very small amount of call and put option contracts and are leaning neutral to bullish over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion…

E = Earnings Are Increasing Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Akamai Technologies’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Akamai Technologies look like and more importantly, how did the markets like these numbers?

	2013 Q1	2012 Q4	2012 Q3	2012 Q2
Earnings Growth (Y-O-Y)	24.39%	14.40%	17.39%	-4%
Revenue Growth (Y-O-Y)	16.72%	22.51%	19.61%	15.76%
Earnings Reaction	19.42%	-15.19%	6.72%	24.03%

Akamai Technologies has seen increasing earnings and revenue figures over the last four quarters. From these figures, the markets have been mostly pleased with Akamai Technologies’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has Akamai Technologies stock done relative to its peers, Level 3 Communications (NYSE:LVLT), Limelight Networks (NASDAQ:LLNW), Internap Network Services (NASDAQ:INAP), and sector?

	Akamai Technologies	Level 3 Communications	Limelight Networks	Internap Network Services	Sector
Year-to-Date Return	4.35%	-11.38%	-11.71%	19.48%	14.08%

Akamai Technologies has been an average performer, year-to-date.

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Conclusion

Akamai Technologies provides technology products and services to a growing user base in a number of industries around the world. The stock has been performing well in recent years and looks to be getting ready to see higher prices. Earnings and revenue numbers have been shows excellent signs of growth which has really pleased investors. Relative to its strong peers and sector, Akamai Technologies has been an average year-to-date performer. Look for Akamai Technologies to continue to OUTPERFORM.

Here's How Outerwall Is Making You So Much Cash

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

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

Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on Outerwall (Nasdaq: OUTR  ) , whose recent revenue and earnings are plotted below.

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

Over the past 12 months, Outerwall generated $246.8 million cash while it booked net income of $119.1 million. That means it turned 11.2% of its revenue into FCF. That sounds pretty impressive.

All cash is not equal
Unfortunately, the cash flow statement isn't immune from nonsense, either. That's why it pays to take a close look at the components of cash flow from operations, to make sure that the cash flows are of high quality. What does that mean? To me, it means they need to be real and replicable in the upcoming quarters, rather than being offset by continual cash outflows that don't appear on the income statement (such as major capital expenditures).

For instance, cash flow based on cash net income and adjustments for non-cash income-statement expenses (like depreciation) is generally favorable. An increase in cash flow based on stiffing your suppliers (by increasing accounts payable for the short term) or shortchanging Uncle Sam on taxes will come back to bite investors later. The same goes for decreasing accounts receivable; this is good to see, but it's ordinary in recessionary times, and you can only increase collections so much. Finally, adding stock-based compensation expense back to cash flows is questionable when a company hands out a lot of equity to employees and uses cash in later periods to buy back those shares.

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

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

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

With 24.4% of operating cash flow coming from questionable sources, Outerwall investors should take a closer look at the underlying numbers. Within the questionable cash flow figure plotted in the TTM period above, other operating activities (which can include deferred income taxes, pension charges, and other one-off items) provided the biggest boost, at 16.0% of cash flow from operations. Overall, the biggest drag on FCF came from capital expenditures, which consumed 45.2% of cash from operations.

A Foolish final thought
Most investors don't keep tabs on their companies' cash flow. I think that's a mistake. If you take the time to read past the headlines and crack a filing now and then, you're in a much better position to spot potential trouble early. Better yet, you'll improve your odds of finding the underappreciated home-run stocks that provide the market's best returns.

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

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Confused? Bad News Sends the Dow Higher

Ever since the Federal Reserve announced its preliminary plans to exit its quantitative-easing program, investors have changed their previous views that the Fed wouldn't do anything that would allow the economy to slip back into recession. Today, though, some of the old enthusiasm came back into the market after first-quarter GDP was revised from 2.4% down to 1.8%, inspiring confidence that the Fed won't start tapering its bond-buying program as soon as many had feared. With the old "bad news is good news" paradigm seemingly back in effect, the Dow Jones Industrials (DJINDICES: ^DJI  ) has posted a triple-digit gain in early trading, up 106 points at 10:55 a.m. EDT.

Among Dow stocks, Boeing (NYSE: BA  ) has powered the Dow's gains, rising more than 2% after customer British Airways took delivery of its first Dreamliner aircraft. Even with the time frame for Dreamliner deliveries having been derailed by the aircraft's battery problems, airline companies appear to remain committed to the fuel savings and other efficiency benefits that Boeing's newer aircraft offer. With trillions of dollars of new orders expected in the coming 20 years, Boeing only needs to demonstrate its ability to make good on its order backlog in order to reap huge gains.

Some stocks aren't taking part in the rally, though. Alcoa (NYSE: AA  ) is down 1%, suffering along with the commodity-metals markets. Gold and silver have plunged again, hitting three-year lows in the face of perceived pressure from changing central-bank policy. For Alcoa, meanwhile, low commodity prices mean sustained plant closures and capacity underutilization, forcing impatient investors to wait even longer for a long-hoped-for cyclical upturn.

Finally, outside the Dow, for-profit education company Apollo Group (NASDAQ: APOL  ) has sounded alarm bells once more, falling 5.4% after reporting disappointing enrollment figures. New enrollment dropped by nearly a quarter, and investors ignored earnings that topped expectations after accounting for one-time items. Given the regulatory attention that Apollo and its peers have gotten lately regarding their marketing practices and concerns about students' ability to repay student loans, the entire industry seems trapped by pessimism. The fact that Apollo is getting kicked out of the S&P 500 only adds insult to the injury of its plunging stock price in recent years.

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Abrams: If Santa pitched a venture capitalist

Scene: A conference room at a major Silicon Valley venture capital firm. The firm's partners — VC below, for venture capitalist — are discussing a potential investment from an entrepreneur who recently pitched them. Also attending is a chief executive of a micro-blogging site; a tech intern; and a secretary, who is taking notes and refreshing coffee.

VC No. 1: "Next, we have Dasher-Dancer Industries, headed by a guy named Santa Claus. It's in the toy space, already global, with high market penetration in the children's segment."

COLUMN: Women get involved in venture capital
STORY: Profit in season for Christmas biz

VC No. 2: "An existing business? We only fund start-ups."

VC No. 1: Yes, but this guy's got unparalleled market reach — more than 2 billion kids a year! He's done nothing to leverage this amazing user base."

VC No. 3: What does he plan to use the money for?

VC No. 1: Modernization. His database is a bunch of parchment scrolls. He's got rising costs of production. His work force is elves, and the European Union objects. The biggest problem is kids' gift expectations: they used to be happy with dolls and games. Now they want iPads and xBoxes.

VC No. 3: What's Santa's business model?

VC No. 1: He doesn't have one! He's stayed in business for centuries, capturing 100% market share without charging a cent. A totally unexploited customer base.

VC No. 3: How do we monetize that?

VC No. 4: The next big social media company — maybe "SantaBook" or "SantaChat?" To get a gift, a kid has to "like" Santa and upload pics or videos.

Santa's got a great following among the kiddie set, but marketers see a problem: He doesn't charge for his services.(Photo: Getty Images)

VC No. 2: Perfect for advertising. Toy companies would know exactly which presents each kid wants. Charge more to parents of kids who really, really want a particular toy.

VC No. 3: Could we convert this to a "freemium" model? Give kids one small gift but charge them for premium gifts? That's worked for cloud services.

STORY: App captures Santa in your house

VC No. 4: No, no. This is a big data play. Santa has information on every child in the world: Where they live, what they want, whether they've been naughty or nice. Wow! That's a massively useful database.

Tech intern: "We could turn that into an awesome app."

Secretary (the only woman in the room): "Have you talked with any children or moms about how they'd react if you monetized Santa? After all, they make up most of Santa's user base."

CEO of a major micro-blogging site: "I'm not going to talk to a mom just to check a box. Anyway, where could you find a qualified woman?"

VC No. 2: Of course, we'd have to bring in a CEO. If we're going to scale this, we need a guy who's run a big operation before. I know a former CEO of a fast-food conglomerate we could get if we give him enough stock and a big salary.

VC No. 5: "How about the sustainable energy angle? Santa manages to circle the globe with just reindeer. Reindeer food is a renewal energy source. How about building reindeer-powered vehicles?"

VC No. 3: "Could we get Elon Musk to run it?"

Santa could have a lot more money in his bags if he monetized his naughty and nice lists.(Photo: Getty Images)

VC No. 2: "Manufacturing! Bah, humbug. Building stuff takes too long to get us the sky-high returns on investment we've come to expect. Do you think this is venture capital fro! m the 198! 0s? Stick with applications and social media."

Tech Intern: "We could make a really awesome Santa app."

VC No. 4: "We're overlooking an incredible resource Santa is literally sitting on, the North Pole. With global warming, the North Pole ice cap is shrinking, opening up new areas for mining."

VC No. 2: There are 2.2 billion children in the world. If we just monetize 1% of them, it's still a huge business.

VC No. 5: Let's look at those numbers a bit closer. More than 400 million of the world's children live in abject poverty, less than $1.25 a day. Every day 21,000 children die — 7.6 million a year — most from preventable causes; 57 million children globally are denied even a primary education. Even in America, nearly 16 million don't know if they'll get their next meal.

(The room goes completely silent.)

VC No. 5: What if instead of making children a market, we made them a cause? We could call it "Santa Cause," dedicating ourselves to helping children worldwide get out of poverty, and have access to education and health care. We could support groups like FeedingAmerica and the United States Fund for UNICEF.

VC No. 4: Wow, that's a powerful mission statement. Santa would love it.

Tech Intern: But could we still make an awesome app?

Rhonda Abrams is president of The Planning Shop and publisher of books for entrepreneurs. Her most recent book is Entrepreneurship: A Real-World Approach. Register for Rhonda's free newsletter at PlanningShop.com. Twitter: @RhondaAbrams. Facebook: facebook.com/RhondaAbramsSmallBusiness. Copyright Rhonda Abrams 2013.

FedEx Corporation (NYSE:FDX) Q2 Preview: Can FedEx Deliver Another Earnings Upside?

FedEx Corporation (NYSE:FDX) is expected to release its second quarter financial results on Dec.18. The delivery services company will host a conference call for the investment community on the same day at 8.30 Eastern Time.

FedEx, with annual revenue of $45 billion, provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services.

Wall Street expects FedEx to earn $1.63 a share, according to analysts polled by Thomson Reuters. The consensus estimate implies an increase of 17.3 percent from $1.39 a share in the same quarter last year. FedEx saw EPS growth of 6 and 7 percent the last two quarters, after reporting three straight periods of falling profits in late 2012 and early 2013.

[Related -FedEx Corporation (FDX) Breakout Into Parabolic Arc Pattern]

FedEx's earnings have managed to top Street view twice in the past four quarters. The consensus estimate has improved by a penny the last 90 days, and six analysts have upped their earnings estimate for the company in the past month.

Quarterly revenue is expected to increase 2.9 percent to $11.43 billion from $11.11 billion in the corresponding quarter last year. In the past four quarters, the average revenue growth was 3 percent.

FedEx is turning around its core business and reporting growth in overall demand for its global portfolio of solutions. FedEx Express remains focused on reducing costs while facing challenging global economic conditions, and FedEx Ground continues to generate strong profitability on growing customer demand for its services.

[Related -Calls Options Active in Dreamworks Animation Skg Inc (DWA)and FedEx Corporation (FDX)]

Package volume (both domestic and international) is a key metric in FedEx results. For the first quarter, U.S. domestic average daily package volume increased 1 percent while U.S. domestic revenue per package was essentially flat as a higher rate per pound and weight per package were offset by lower fuel surcha! rges.

FedEx international's export average daily volume grew 4 during the first quarter as FedEx International Economy grew 15 percent. International export revenue per package fell 4% primarily due to lower fuel surcharges, lower rates and the demand shift to lower-yielding international services.

Operating income and margin growth would be watched as they were generally constrained by the significant net negative impact of the fuel surcharge timings.

FedEx Ground is the sweet spot of FedEx operating results, with volume growth hovering around 10 percent, and FedEx Freight Segment is showing improvement in the less-than-truckload (LTL) yields.

The company would also benefit from the recently announced rate increases. Effective Jan. 6, 2014, the company would increase shipping rates for FedEx Ground and FedEx Home Delivery by an average of 4.9 percent FedEx Express will increase shipping rates by an average of 3.9 percent for U.S. domestic, U.S. export and U.S. import services. FedEx Freight implemented a 4.5 percent general rate increase on July 1, 2013.

Top 5 Tech Stocks To Buy For 2014

Meanwhile, the outlook for the third quarter should hog the limelight as it includes the results of the busiest holiday period amid surging e-commerce sales.

According to the National Retail Federation (NRF), holiday sales are expected to grow 3.9 percent to $602 billion. This is higher than the average increase of 3.3 percent over the last 10 years. Online holiday sales are expected to increase 15.1 percent year-over-year to $61.8 billion, according to eMarketer.

FedEx saw its busiest day in company history when it moved more than 22 million shipments around the world on Cyber Monday, Dec. 2, 2013. The 11 percent year-over-year increase was driven by online retailers feeding the FedEx Ground and FedEx SmartPost networks. During the busiest week of the year, Dec. 1 – 7, FedEx recorded! more tha! n 85 million shipments through its global networks.

The Street will look for any update on the full year outlook. FedEx sees full-year earnings per share growth of 7 to 13 percent from last year's adjusted results. This outlook assumes the market outlook for fuel prices, U.S. GDP growth of 2.1 percent and world GDP growth of 2.6 percent. The capital spending forecast for fiscal 2014 remains $4 billion. FedEx Express unit is expected to achieve its $1.6 billion operating profit improvement target by the end of fiscal 2016.

For the first quarter ended Aug.31, FedEx reported earnings of $1.53 a share, compared to $1.45 a share last year. Net income grew 7 percent to $489 million, and revenue rose 2 percent to $11.0 billion.

Shares of FDX have gained 46 percent this year and 20 percent since its last quarterly report. They trade 15.6 times forward earnings versus larger rival UPS' 18.6 times.

Blackstone, CCMP Capital, And Investcorp Want A Piece Of Versace At $1.5B Valuation

After leading the charge to buy a minority stake in luxury brand Versace, Italy's state-owned private equity fund seems to have lost out to a trio including Blackstone, CCMP Capital, and Bahrain's Investcorp.  While negotiations remain ongoing, the deal would include a 20% stake in the luxury retailer, valuing Versace at about $1.5 billion, according to Sky News.  A big deal for a minority stake in Versace would confirm the ferocious investor appetite for luxury names, with Moncler's stock market debut on Monday taking shares in the coat maker up 47%, delivering a windfall to founder Remo Ruffini and private equity backers Eurazeo Eurazeo and Carlyle Group.

Considered the front-runner in the negotiations only two weeks ago, Fondo Strategico Italiano (FSI) appears to have been relegated from a short list to acquire a 20% stake in one of the world's most iconic luxury fashion brands: Versace.  Instead, two New York firms, Blackstone and CCMP Capital, along with Bahrain's Investcorp could be nearing a deal with Donatella, sister of murdered founder Gianni Versace and the label's head designer, who is said to be leading negotiations.  While FSI seems to have lost out, a new round of bidding is expected before the end of the year.

Appetite for luxury has been sky high, and this could mean a lot of money for private equity.  As my colleague Nathan Vardi reported, Monday saw the stock market debut of coat maker Moncler, which saw its stock surge nearly 50%, giving the company a valuation of more than $5 billion by the end of the trading session.  Paris-based PE firm and Eurazeo and the Carlyle Group raised more than $1 billion selling shares in the IPO.

And Moncler is not alone.  Since going public in late 2011, shares in Michael Kors have gone through the roof, rising 240%.  This year, the stock is up 60% as investors continue to bet on the brand's growth in the high-end market.  Michael Kors himself has become a very wealthy man due to the success of his company's stock, worth approximately $950 million given the shares he's sold and the additional options he holds, as Forbes' Brian Solomon explained.

If the Versaces secure a deal at a £900 million ($1.466 billion) valuation, as Sky News reported, they could be well on their path to billionaire status.  The company's biggest shareholder is Allegra, Gianni's niece, with a 50% stake, would see her net worth approximate $600 million after discounting 20% for potential dilution and continued investments in growing of the brand.  Gianni's brother Santo, sitting on a 30% stake, would be worth about $352 million, while Donatella's 20% position would have a value of about $234 million.

If the company continues on its current growth trajectory, last year they saw revenues jump 20% to $552.8 million, then a possible IPO could very well make the Versace billionaires over the next few years.  Regardless, what is clear at this juncture is that since the financial crisis, investor appetite for anything luxury, from fashion to real estate, remains unwavering.  And with that, private equity firms have the chance to make a killing.

Top 10 Tech Companies To Buy For 2014

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This week, these five stocks have the worst ratings in Analyst Earnings Revisions, one of the eight Fundamental Categories on Portfolio Grader.

Vocera Communications, Inc. () is a provider of mobile communication solutions designed to restore the human connection to healthcare. VCRA also gets F’s in Earnings Growth, Equity and Operating Margin Growth. .

Top 10 Tech Companies To Buy For 2014: Csr Ord 0.1p(CSR.L)

CSR plc, a fabless semiconductor company, designs and develops semiconductors and software based solutions in the United Kingdom, rest of Europe, the Americas, and Asia. It offers multifunction semiconductor platforms for the auto, camera, low energy connectivity, document imaging, and wireless voice and music markets; and semiconductors for the handset and other consumer electronics markets. The company?s technology portfolio comprises Bluetooth and Bluetooth SMART; global positioning system (GPS) and global navigation satellite systems location products; frequency modulated radio; Wi-Fi or wireless fidelity; audio and associated codec; near-field communication, a short range wireless technology that enables the transfer of data and secure transactions between devices; and imaging and video processing technologies. Its technologies have applications in a range of mobile consumer devices, such as handsets, tablets, automotive infotainments systems, personal navigation dev ices, wireless headsets, wireless audio systems, personal computers, GPS recreational devices, tracking and logistics management systems, digital cameras, printers, digital televisions, and gaming devices. The company markets its products to original equipment manufacturers and original design manufacturers primarily through its direct sales force and sales representatives, as well as through a network of distributors. It has operations in the United Kingdom, the United States, China, Taiwan, South Korea, Israel, Japan, and Singapore. CSR plc was founded in 1999 and is headquartered in Cambridge, the United Kingdom.

Top 10 Tech Companies To Buy For 2014: Sanofi(SNY)

sanofi-aventis engages in the discovery, development, and distribution of therapeutic solutions to improve the lives of everyone. The company offers a range of healthcare assets, including a broad-based product portfolio in prescription drugs, OTC/OTX, generics, vaccines, and animal health. It has a strategic alliance with Regulus Therapeutics Inc. to discover, develop, and commercialize micro-RNA therapeutics, initially in fibrosis. The company was founded in 1970 and is headquartered in Paris, France.

Advisors' Opinion:

• [By Keith Speights]

  Sanofi (NYSE: SNY  ) currently dominates the market with Lantus. The French drugmaker also markets Apidra, but hasn't experienced nearly as much success with the product.

• [By Keith Speights]

  Aegerion Pharmaceuticals (NASDAQ: AEGR  ) received FDA approval in late 2012 for Juxtapid in the treatment of HoFH. Soon afterward, the FDA approved another drug targeting HoFH, Kynamro, which was developed by Isis Pharmaceuticals (NASDAQ: ISIS  ) and marketed by Sanofi's (NYSE: SNY  ) Genzyme unit.

Top 5 Growth Companies For 2014: Internet Gold Golden Lines Ltd.(IGLD)

Internet Gold ? Golden Lines Ltd., together with its subsidiaries, provides communications services in Israel. The company offers a range of telecommunication operations and services, including domestic fixed-line, cellular and international communication services, multi-channel television, satellite broadcasts, Internet services, customer call centers, maintenance and development of communications infrastructures, provision of communications services to other communications providers, television and radio broadcasts, and supply and maintenance of equipment on customer premises. It also provides data services, server and Web site hosting services, technical maintenance and support services, networking and system services, outsourcing and out-tasking services, security and risk management solutions, and IP based services; media services, which include the sale of advertising on its Web sites; and sale of products and services on the Internet. The company was formerly known as Euronet Golden Lines (1992) Ltd. and changed its name to Internet Gold ? Golden Lines Ltd. in June 1999. The company was founded in 1992 and is headquartered in Ramat Gan, Israel. Internet Gold ? Golden Lines Ltd. is a subsidiary of Eurocom Communications Ltd.

Top 10 Tech Companies To Buy For 2014: Kratos Defense & Security Solutions Inc.(KTOS)

Kratos Defense & Security Solutions, Inc. provides mission critical products, services, and solutions in the United States. The company?s Kratos Government Solutions segment offers various services comprising weapon systems sustainment, lifecycle support, and extension; command, control, communications, computing, combat systems, intelligence, surveillance, and reconnaissance services, including cybersecurity, cyberwarfare, information assurance, and situational awareness solutions; military range operations and technical services; missile, rocket, and weapons systems test and evaluation; mission launch services; modeling and simulation; unmanned aerial vehicle products and technology; advanced network engineering and information technology services; and public safety, security, and surveillance systems integration. Its Public Safety & Security segment provides independent integrated solutions for homeland security, public safety, critical information, and security and su rveillance systems. This segment?s solutions consists of designing, installing, and servicing building technologies that protect people, critical infrastructure, assets, information, and property in various areas, such as the design, engineering, and operation of command and control centers; design, engineering, deployment, and integration of access control; building automation and control; communications; digital and closed circuit television security and surveillance; fire and life safety; maintenance services; and product support services. The company primarily serves the United States government agencies, including the department of defense, classified agencies, intelligence agencies, other national security agencies, and homeland security related agencies. The company was formerly known as Wireless Facilities, Inc. and changed its name to Kratos Defense & Security Solutions, Inc. in September 2007. The company was founded in 1994 and is headquartered in San Diego, Cali fornia.

Advisors' Opinion:

• [By Rich Smith]

  On Monday, the Department of Defense awarded 19 contracts, which added�up to just under $1.5 billion in total value. The largest award went to a private company to pay for "full line food distribution" in Okinawa. But even so, there were a few contracts worth noting, going to publicly traded companies:

Top 10 Tech Companies To Buy For 2014: Symmetricom Inc.(SYMM)

Symmetricom, Inc. provides timekeeping technologies, instruments, and solutions worldwide. Its Communications business unit provides timing technologies and services for communications infrastructure. The Communications business unit products comprise primary reference sources; edge clocks and distribution products for synchronization outside the network core; building integrated timing supply and sync supply unit for the central office; the PackeTime product suite; data over cable service interface specifications timing interface systems; network management and monitoring software; and embedded hardware and software solutions for integration with various elements of the communications ecosystem, such as silicon, routers, switches, microwave backhaul, and base stations. The company?s Government business unit offers time technology products for aerospace/defense, IT infrastructure, power infrastructure, and science and metrology applications. The Government business unit p roduct portfolio comprises timescale clock sources; network time servers; network time displays; time code generators; bus level timing cards; primary reference standards, such as rubidium and cesium oscillator standards; high stability masers; chip-scale atomic clocks; ruggedized crystal oscillators; and custom time and frequency systems. It offers timekeeping in GPS satellites, national time references, and national power grids, as well as in critical military and civilian networks, which enable data, voice, mobile, and video networks and services. The company sells its products through distributors, systems integrators, and manufacturer sales representatives. It serves various markets, including communications service providers; network equipment manufacturers; silicon suppliers; aerospace/defense; power utility infrastructure; IT infrastructure; underwater exploration and navigation; and science and metrology. The company was founded in 1956 and is headquartered in San J ose, California.

Advisors' Opinion:

• [By Lauren Pollock]

  Microsemi Corp.(MSCC) agreed to pay almost $298 million to acquire Symmetricom Inc.(SYMM), a deal that will expand the power-management supplier’s exposure into the aerospace and defense industries while also immediately adding to earnings. Shares in Symmetricom soared.

• [By Rich Smith]

  San Jose, Calif.-based Symmetricom (NASDAQ: SYMM  ) has a new chief executive officer.

  On Tuesday, the "precise time" computer announced a series of changes in upper management. Current CEO David G. Cote is leaving the company "to pursue other interests" and has been replaced by new CEO Elizabeth A. Fetter, a current board member. Details on Fetter's compensation have yet to be filed with the SEC.

Top 10 Tech Companies To Buy For 2014: I.D. Systems Inc.(IDSY)

I.D. Systems, Inc. develops, markets, and sells wireless solutions for managing and securing enterprise assets, including industrial vehicles, such as forklifts, airport ground support equipment, rental vehicles, and transportation assets primarily in North America. The company offers integrated wireless solutions that enable customers to control, monitor, track, and analyze their enterprise assets. Its campus-based fleet management products include On-Asset Hardware, which provides an autonomous means of asset control and monitoring; Wireless Asset Managers that link mobile assets being monitored with customer?s computer network or to a remotely hosted server; Server Software, which manages data communications between the system?s database and either the Wireless Asset Managers or On-Asset Hardware; and Client Software, which restricts access and limits corruption of system information, as well as minimizes network bandwidth usage. The company?s remote asset management products comprise On-Asset Hardware, which addresses various remote asset types, such as dry van trailers, refrigerated trailers, domestic containers, and railcars, as well as customer-specific requirements; and VeriWise Intelligence Portal, a hosted Website that provides Internet access to client asset information. The company also offers direct feed of the data to customer through XML or Web services. In addition, it provides maintenance, customer support, and consulting services. I.D. Systems markets and sells its wireless solutions to a range of customers in the commercial and government sectors operating in various markets, such as automotive manufacturing, retailers, shippers, freight transportation companies, heavy industry, retail and wholesale distribution, aerospace and defense, homeland security, and vehicle rental directly, as well as through indirect sales channels, such as industrial equipment dealers. The company was founded in 1993 and is headquartered in Wo odcliff Lake, New Jersey.

Advisors' Opinion:

• [By John Udovich]

  Yesterday, small cap identity protection stock Lifelock Inc (NYSE: LOCK) surged 15.64% after reporting better-than-expected third quarter earnings thanks in part to playing on the security fears of consumers, meaning its probably time to take a look at it along with two other security stocks, I.D. Systems, Inc (NASDAQ: IDSY) and View Systems Inc (OTCBB: VSYM), which can also play up the fear factor:�

Top 10 Tech Companies To Buy For 2014: Lantronix Inc.(LTRX)

Lantronix, Inc. designs, develops, markets, and sells networking and Internet connectivity products that are used to access, manage, control, and configure electronic products over the Internet, enterprise, and other networks worldwide. It provides device enablement solutions for products that are to be connected, securely accessed, managed, and controlled over networks to manufacturers, integrators, and end-users; and device management solutions, including single and multi-port products that offer information technology professionals with the tools need to remotely connect to the out-of-band management ports on computers and associated equipment. The company?s device management solutions also comprise console servers, remote keyboards, video, mouse servers, and managed power distribution products, which are used to monitor and run systems to ensure the performance and availability of critical business information systems, network infrastructure, and telecommunications eq uipment, as well as manages routers, switches, servers, phone switches, and public branch exchanges that are located in remote or inaccessible locations. It also provides legacy products, such as print servers, software, and other miscellaneous products. The company serves healthcare, security, industrial and building automation, energy, information technology and data centers, transportation, and government markets. It sells its products through distributors, manufacturer?s representatives, value added resellers, and other resellers. The company was founded in 1989 and is headquartered in Irvine, California.

Top 10 Tech Companies To Buy For 2014: Progress Software Corporation(PRGS)

Progress Software Corporation operates as an enterprise software company worldwide. Its products include Progress OpenEdge platform, which offers development tools, application servers, application management tools, and an embedded database; Progress Orbix to address enterprise integration problems with standards-based solutions; and Progress ObjectStore, an object data management system to store data faster than relational database management system or file-based storage system. The company?s products also comprise Progress Responsiveness Process Management suite for business users; Progress Control Tower, an interactive business control panel; Progress Sonic, which comprises an enterprise messaging system and the enterprise service buses; Progress Actional that provides operational and business visibility, root cause analysis, and policy-based security and control of services; Progress Apama, which offers tools for creating, testing, and deploying strategies for applicat ions, including algorithmic trading, market aggregation, smart order routing, market surveillance and monitoring, and risk management; Progress Savvion BusinessManager, a business process management software; and Fuse products that provide customers with access to professional open source integration and messaging software. In addition, it offers Progress DataDirect Connect products, which provide data connectivity components; Progress DataDirect Shadow to provide foundation architecture for standards-based mainframe integration; and Progress Data Services product set that offers data integration for distributed applications. Further, the company provides maintenance, consulting, training, and customer support services. Progress Software Corporation sells its products to independent software vendors, original equipment manufacturers, and system integrators through direct sales force and independent distributors. The company was founded in 1981 and is based in Bedford, Massac husetts.

Advisors' Opinion:

• [By Rich Duprey]

  Believing it should have a single, cohesive platform for the development of�cloud and mobile application development technologies, Progress Software (NASDAQ: PRGS  ) announced this morning it was selling its�Apama�complex event processing solution to Software AG for an undisclosed sum.

Top 10 Tech Companies To Buy For 2014: AVG Technologies NV (AVG)

AVG Technologies N.V. (AVG), incorporated on March 3, 2011, provides software and online services. The Company is primarily engaged in the development and sale of Internet security software and online service solutions branded under the AVG name. The Company�� solutions include software and online services, include security, personal computer (PC) management, online backup and other products. As of December 31, 2011, the Company had approximately 15 million subscription users. AVG�� portfolio consists of Anti-Virus suite, Internet Security suite, Premium Security suite, AVG Mobilation, AVG Threatlabs, Family Safety, TuneUp Utilities and PC Tuneup, LiveKive and MultiMi. On January 4, 2011, the Company acquired DroidSecurity Ltd. On March 3, 2011, the Company established AVG Holding Cooperatief U.A. On May 18, 2011, the Company acquired iMedix Web Technologies Ltd. In August 2011, it acquired TuneUp Software GmbH. On August 19, 2011, AVG Technologies GER GmbH acquired TuneUp Software GmbH. On October 31, 2011, AVG Technologies Holdings B.V. acquired AVG Distribution Switzerland AG. In November 2011, the Company acquired Bsecure Solutions, Inc. On January 13, 2012, AVG Technologies USA, Inc. acquired OpenInstall, Inc. In May 2013, AVG Technologies NV acquired online privacy organisation PrivacyChoice.

The Company�� products include AVG Internet Security, AVG Anti-Virus, AVG Email Server Edition, AVG File Server Edition, AVG Linux Server Edition, AVG Rescue CD and AVG Remote Administration. The Company�� subsidiaries include AVG Technologies USA Inc., AVG Technologies CZ, s.r.o., AVG Technologies UK Ltd, AVG Exploit Prevention Labs, Inc., AVG Technologies GER, GmbH, AVG Technologies FRA SAS, AVG Technologies HK, Limited, AVG (Beijing) Internet Security Technologies Company Limited, AVG Mobile Technologies Ltd, AVG Netherlands B.V., AVG Ecommerce CY Ltd, AVG Technologies Holding B.V., TuneUp Software GmbH, TuneUp Distribution GmbH, TuneUp Corporation and AVG Distribution Switzerland AG! .

The Company competes with Microsoft, Google, Apple, Qihoo, Tencent, Facebook, UniBlue, Symantec, Trend Micro, Avast!, Avira, Symantec, Carbonite, Dropbox, Intel Corporation, Trend Micro, Eset, Kaspersky Labs, Panda Software, Sophos, Rising, Kingsoft, Check Point and F-Secure.

Advisors' Opinion:

• [By Seth Jayson]

  AVG Technologies (NYSE: AVG  ) reported earnings on April 24. Here are the numbers you need to know.

  The 10-second takeaway
  For the quarter ended March 31 (Q1), AVG Technologies beat expectations on revenues and crushed expectations on earnings per share.

Top 10 Tech Companies To Buy For 2014: Imagination Technologies Group(IMG.L)

Imagination Technologies Group plc engages in the design, development, and marketing of multimedia technology and related products. It involved in the development of embedded graphics, video, display, and multi-threaded processor and multi standard broadcast receiver and connectivity technologies, including semiconductor system-on-chip intellectual property (SoC IP) products. The company licenses its SoC IP products, such as POWERVR visual intellectual property (IP), ENSIGMA communications IP, and META multi-threaded processor IP to a range of semiconductor and consumer electronics companies worldwide for use in the mobile phone multimedia, handheld multimedia, home consumer, mobile computing, and in-car electronic markets. It also develops, manufactures, and markets consumer products, such as digital and connected radios. The company is headquartered in Kings Langley, the United Kingdom.

Top Insurance Companies To Watch In Right Now

I admit I have been early on calling the end of the "Fed bubble" as price action has continued to rise further than my greatest expectations. However, as the market has risen, the quality of economic data has deteriorated. Like every other central bank created asset bubble, this time is not different and stocks will correct back to at least pre-QE 3/4 levels.

Those who are bullish on equities often argue that this current rally is sustainable without the Fed due to record high corporate profits. Their logic continues with the idea that the Fed cannot use QE to drive up profits directly. The reality is they can and do. By providing cheap credit for the federal government, the Fed effectively subsidizes earnings.

Quantitative easing boosts earnings by making massive government deficits and social spending affordable. The state effectively replaces large corporations as the supplier of income to consume the products that drive revenues. Earnings have maintained high levels due to companies being to cut jobs without losing much revenue from customers. Since those who live on government benefits likely earn less than during their time working, revenues have stagnated. Population growth and the fact that the government through food stamps, extended unemployment insurance, Obamacare, disability claims, and other welfare has replaced corporations as the supplier of income has prevented revenues from declining.

Top Insurance Companies To Watch In Right Now: Aon Corporation(AON)

Aon Corporation provides risk management services, insurance and reinsurance brokerage, and human resource consulting and outsourcing services primarily in the United States, the Americas, the United Kingdom, Europe, the Middle East, Africa, and the Asia Pacific. The company?s Risk Solutions segment offers retail brokerage products and services, including affinity products, general underwriting management services, placement services, and captive management services; and advisory services to technology, financial services, agribusiness, aviation, construction, health care, and energy industries, as well as facilitates various risk management solutions for property liability, general liability, professional liability, directors' and officers' liability, workers' compensation, and various healthcare products. This segment also provides risk consulting services comprising captive management; eSolutions products that enable clients to manage risks, policies, claims, and safet y concerns through an integrated technology platform; reinsurance brokerage services, such as actuarial, enterprise risk management, catastrophe management, and rating agency advisory services; property and casualty reinsurance; and specialty lines, which include professional liability, medical malpractice, accident, life, and health, as well as capital management transaction and advisory services. Its HR Solutions segment offers human capital services in the areas of health and benefits, retirement, compensation, and strategic human capital; and benefits administration and human resource business process outsourcing services. The company was founded in 1919 and is headquartered in Chicago, Illinois.

Advisors' Opinion:

• [By Holly LaFon]

  Company Dell Inc. (DELL) Chesapeake Energy (CHK) DirecTV (DTV) Loews (L) Walt Disney (DIS) Aon Plc (AON) The Travelers Companies (TRV) Level 3 Communications (LVLT) FedEx (FDX) Bank of New York Mellon (BK)
  Learn more about Mason and his views on the present economy in his second-quarter letter here. See his portfolio here.

Top Insurance Companies To Watch In Right Now: Fairfax Financial Holdings Ltd (FRFHF.PK)

Fairfax Financial Holdings Limited (Fairfax) is a financial services holding company. The Company, through its subsidiaries, is principally engaged in property and casualty insurance and reinsurance and the associated investment management. The Company�� segments consist of Insurance, Reinsurance, Insurance and Reinsurance Other, Runoff, and Corporate and Other. On December 22, 2011, the Company completed the acquisition of 75% interests in Sporting Life Inc. On August 16, 2011, the Company acquired William Ashley China Corporation. On March 24, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of The Pacific Insurance Berhad. On February 9, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of First Mercury Financial Corporation. In October 2012, its RiverStone runoff subsidiary acquired all the outstanding shares of Brit Insurance Limited.

Advisors' Opinion:

• [By Alex Jordon]

  There's talk that Prem Watsa, head of Fairfax Financial Holdings (FRFHF.PK), could possibly be involved in a privatization bid for the company. Consider:

• [By Infinity Group]

  With 515 million shares outstanding, this equates to 33% of all shares being shorted. It should also be noted that Prem Watsa's Fairfax Financial Holdings (FRFHF.PK) is holding 51.8 million BlackBerry shares. Prem Watsa stated at the annual FairFax shareholders meeting that Fairfax is holding a long position with BlackBerry and anticipates shareholder value increasing over the next 2-3 years. The cost basis for FairFax financial holdings is approximately $17 per BlackBerry share.

Hot Bank Companies To Buy Right Now: Sun Life Financial Inc.(SLF)

Sun Life Financial Inc., together with its subsidiaries, provides various life and health insurance, savings, investment management, retirement, and pension products and services to individuals and corporate customers. It offers individual life insurance policies, including individual term life, universal life, critical illness, disability, accident, and accidental death and dismemberment insurance policies; and group life insurance policies. The company also provides individual health insurance, long-term care insurance, group health benefits, dental benefits, and group insurance; and various individual and group annuity, retirement, and investment income products and services, such as mutual and pooled funds, variable and fixed annuities, savings, retirement and pension plans, and education savings. In addition, it offers asset management services for corporate retirement plans, separate accounts, public or government funds, and insurance company assets to institutional clients; and advisory services to individual investors. Further, the company provides run-off reinsurance services. Sun Life Financial Inc. distributes its products through direct sales agents, independent and managing general agents, financial intermediaries, broker-dealers, banks, pension and benefit consultants, and other third-party marketing organizations. The company operates primarily in Bermuda, Canada, China, Hong Kong, India, Indonesia, Ireland, the Philippines, the United States, and the United Kingdom. Sun Life Financial Inc. was founded in 1999 and is based in Toronto, Canada.

Advisors' Opinion:

• [By Amanda Alix]

  Insurance companies have created an entire industry based upon risk, and except for AIG (NYSE: AIG  ) during the financial crisis, it has worked out pretty well. So, it's not a stretch to imagine a large life insurer like Canada's Sun Life Financial (NYSE: SLF  ) assuming the pension liability for the Canadian Wheat Board's defined benefit plan in a recent $147 million deal, the first such accord in Canada's history.

• [By Tim Brugger]

  Initially, the deal Sun Life Financial (NYSE: SLF  ) struck in December to sell its U.S. annuity portfolio and some life insurance products for $1.35 billion to Delaware Life Holdings, a Guggenheim Partners-owned company, was scheduled to be completed by Q2 of 2013.

• [By Monica Gerson]

  Sun Life Financial (NYSE: SLF) shares gained 2.47% to create a new 52-week high of $34.80 on Q3 results. Sun Life reported its Q3 operating net income from continuing operations of $422 million.

Top Insurance Companies To Watch In Right Now: Old Republic International Corporation(ORI)

Old Republic International Corporation, through its subsidiaries, provides various insurance and mortgage guaranty products in North America. The company operates in three segments: General Insurance, Mortgage Guaranty, and Title Insurance. The General Insurance segment provides liability insurance coverages to businesses, government, and other institutions in commercial construction, forest products, energy, general manufacturing, and financial services industries; and transportation, including trucking and general aviation industries. It provides various insurance products, such as automobile extended warranty, aviation, commercial automobile insurance, general liability, home warranty, inland marine, travel accident, and workers? compensation, as well as liability coverage for claims arising from the acts of owners or employees, and protection for the physical assets of businesses. This segment also offers financial indemnity products, such as consumer credit indemnity , errors and omissions/directors and officers, guaranteed asset protection, and surety, as well as bonds that cover the exposures for losses of monies, or debt and equity securities due to acts of employee dishonesty. The Mortgage Guaranty segment insures first mortgage loans, primarily on residential properties incorporating one-to-four family dwelling units to mortgage bankers, brokers, commercial banks, and savings institutions. The Title Insurance segment provides lenders' and owners' title insurance policies to real estate purchasers and investors based upon searches of the public records. It also provides escrow closing and construction disbursement services; and real estate information products, national default management services, and services related to real estate transfers and loan transactions. Old Republic International Corporation markets its products directly, as well as through insurance agents and brokers. The company was founded in 1887 and is based in Chi cago, Illinois.

Advisors' Opinion:

• [By Fredrik Arnold]

  Ten Champion dogs that promised the biggest dividend yields into July included firms representing five of nine market sectors. The top stocks were three of five from the financial sector: Universal Health Realty Trust (UHT); Mercury General Corp. (MCY); Old Republic Int'l (ORI). The other two financial firms, HCP Inc., and United Bankshares Inc. (UBSI), placed sixth and eighth.

• [By Ben Levisohn]

  Its big day has also boosted other insurers. Radian Group (RDN) has risen 7.2% to $14.39, while Old Republic International (ORI) has advanced 2.1% to $15.24, Genworth Financial (GNW) is up 3.6% at $13.41 and MBIA Inc. (MBI) has jumped 4.3% to $10.76.

Top Insurance Companies To Watch In Right Now: Fairfax Financial Holdings Ltd (FRFHF)

Fairfax Financial Holdings Limited (Fairfax) is a financial services holding company. The Company, through its subsidiaries, is principally engaged in property and casualty insurance and reinsurance and the associated investment management. The Company�� segments consist of Insurance, Reinsurance, Insurance and Reinsurance Other, Runoff, and Corporate and Other. On December 22, 2011, the Company completed the acquisition of 75% interests in Sporting Life Inc. On August 16, 2011, the Company acquired William Ashley China Corporation. On March 24, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of The Pacific Insurance Berhad. On February 9, 2011, an indirect wholly owned subsidiary of Fairfax completed the acquisition of First Mercury Financial Corporation. In October 2012, its RiverStone runoff subsidiary acquired all the outstanding shares of Brit Insurance Limited. Advisors' Opinion:

• [By Dan Caplinger]

  That business model has been so successful that other, smaller insurance companies have emulated it. For instance, Fairfax Financial (NASDAQOTH: FRFHF  ) and Markel (NYSE: MKL  ) have used the same investing model to take advantage of their respective core insurance businesses. Both Fairfax and Markel have had substantial success, showing the power of using temporarily available premium reserves to make higher-return investments.

• [By Tim Brugger]

  Citing the letter of intent to be acquired�for $9 a share signed Monday with a consortium led by its largest shareholder, Fairfax Financial (NASDAQOTH: FRFHF  ) , BlackBerry� (NASDAQ: BBRY  ) �has opted to cancel its conference call and webcast following the 7 .a.m EST release of Q2 earnings this Friday, the company announced yesterday.

4 Stocks Triggering Breakouts on Big Volume

DELAFIELD, Wis. (Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

>>5 Stocks Insiders Love Right Now

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

>>5 Stocks Set to Soar on Bullish Earnings

With that in mind, let's take a look at several stocks rising on unusual volume today.

Under Armour

Under Armour (UA) is engaged in designing, development, marketing and distribution of technologically advanced, branded performance products for men, women and youth. This stock closed up 1.6% to $84.47 in Wednesday's trading session.

Wednesday's Volume: 1.94 million

Three-Month Average Volume: 1.23 million

Volume % Change: 66%

From a technical perspective, UA spiked modestly higher here and broke out above some near-term overhead resistance at $83.83 with above-average volume. This move is quickly pushing shares of UA within range of triggering another big breakout trade. That trade will hit if UA manages to take out Wednesday's high of $85.65 to its 52-week high at $86.02 with high volume.

Traders should now look for long-biased trades in UA as long as it's trending above Wednesday's low of $83.24 or above its 50-day at $80.97 and then once it sustains a move or close above those breakout levels with volume that hits near or above 1.23 million shares. If that breakout hits soon, then UA will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $93 to $95.

AbbVie

AbbVie (ABBV), a research-based biopharmaceutical company, engages in the discovery, development, manufacture and sale of pharmaceutical products worldwide. This stock closed up 1% at $52.67 in Wednesday's trading session.

Wednesday's Volume: 10.77 million

Three-Month Average Volume: 5.2 million

Volume % Change: 128%

From a technical perspective, ABBV spiked modestly higher here with strong upside volume. This stock has been uptrending strong for the last three months and change, with shares moving higher from its low of $41.87 to its recent high of $54.13. During that uptrend, shares of ABBV have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of ABBV within range of triggering a near-term breakout trade. That trade will hit if ABBV manages to take out Wednesday's high of $53.25 to its 52-week high at $54.13 with high volume.

Traders should now look for long-biased trades in ABBV as long as it's trending above some near-term support levels at $50 or at $49 and then once it sustains a move or close above those breakout levels with volume that hits near or above 5.2 million shares. If that breakout hits soon, then ABBV will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $60 to $62.

NewLink Genetics

NewLink Genetics (NLNK) is focused on discovering, developing and commercializing immunotherapeutic products to improve cancer treatment options for patients and physicians. This stock closed up 2.2% at $21.60 in Wednesday's trading session.

Wednesday's Volume: 370,000

Three-Month Average Volume: 206,997

Volume % Change: 105%

From a technical perspective, NLNK spiked modestly higher here right above some near-term support at $20.07 with above-average volume. This move is starting to push shares of NLNK within range of triggering a major breakout trade. That trade will hit if NLNK can manage to take out some near-term overhead resistance levels at $22.86 to its all-time high at $23.67 with high volume.

Traders should now look for long-biased trades in NLNK as long as it's trending above some near-term support levels at $20.07 or above $19.50 and then once it sustains a move or close above those breakout levels with volume that's near or above 206,997 shares. If that breakout hits soon, then NLNK will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $28 to $30.

Children's Place Retail Stores

Children's Place Retail Stores (PLCE) operates as a specialty retailer of apparel and accessories for children. This stock closed up 4.3% at $54.96 in Wednesday's trading session.

Wednesday's Volume: 993,000

Three-Month Average Volume: 426,089

Volume % Change: 113%

From a technical perspective, PLCE spiked sharply higher here right off its 50-day moving average of $53.82 with above-average volume. This stock has been trending sideways and consolidating for the last month and change, with shares moving between $50.74 on the downside and $56.44 on the upside. Shares of PLCE are quickly moving within range of triggering a near-term breakout trade above the upper-end of its recent sideways trading chart pattern. That trade will hit if PCLE manages to take out Wednesday's high of $55.67, and then once it takes out some more near-term overhead resistance levels at $56.13 to $56.44 with high volume.

Traders should now look for long-biased trades in PLCE as long as it's trending above its 50-day at $53.82 or above its 200-day at $52.34 and then once it sustains a move or close above those breakout levels with volume that's near or above 426,089 shares. If that breakout hits soon, then PLCE will set up to re-test or possibly take out its 52-week high at $58.89. Any high-volume move above that level will then give PLCE a chance to tag its next major overhead resistance level at $62.24.

To see more stocks rising on unusual volume, check out the Stocks Rising on Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

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Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including

CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

Bitcoins: Deciphering Their Value

During past inflationary periods, investors dedicated small portions of their portfolios to art, stamp and coin collecting as a way to preserve value. Alternative investments such as these have always been a key inflation strategy to preserve wealth. That said, they represent high risk and should only contain amounts that investors can afford to lose.

Predicting the value of these investments involves a sensibility about future cultural tastes, preferences or idiosyncrasies that even the world’s top art, stamp and coin appraisers sometimes have difficulty divining, much less the average investor.

Within this context, we review the advent of the digital, decentralized currency known as Bitcoin. There’s sufficient momentum in the emergence of digital currency to justify watching Bitcoin closely as a potential alternative investment, if the market matures to where it’s more easily accessible and becomes more liquid.

At the very least, companies accepting Bitcoin for payment could make good plays on this trend, especially those in the Internet space.



In the meantime, Bitcoin has garnered global attention with its highly volatile price gyrations and increased adoption.

Supporters claim that digital currency has the potential to be “Gold 2.0,” the world’s next reserve currency or the ultimate payment system, while detractors say it’s a speculative, bubble market with no intrinsic value that’s only good for illicit activities. Further, detractors say that Bitcoin is a market controlled by speculators and could collapse at any moment.

For those new to the subject, Phil Springer, chief investment strategist of Personal Finance, developed a Bitcoin primer, in his Nov. 27 Mind Over Markets article, “Bitcoin: A Joke or the Real Thing?”

Springer! ’s healthy skepticism is shared by your correspondent. But in following various global discussions on the subject—and discussing it myself with an early investor—there are disruptive features to Bitcoin and crypto currencies in general that seem compelling. And while Bitcoin itself may be just the first of various iterations before a dominant design emerges and eventually falls under regulation, the idea of digital currencies is here to stay.

The reason crypto currencies are gaining attention today—particularly Bitcoin—is the fact that they represent a massive technological breakthrough in digital money. Cryptographers have long dreamed of developing a decentralized digital currency and previous attempts had failed. The main issue was how to address the problem of tracking double spending, which is resolved in the real world with a central monetary authority.

“If a digital dollar is just information, free from the corporeal strictures of paper and metal, what’s to prevent people from copying and pasting it as easily as a chunk of text, ‘spending’ it as many times as they want? The conventional answer involved using a central clearinghouse to keep a real-time ledger of all transactions—ensuring that, if someone spends his last digital dollar, he can’t then spend it again. The ledger prevents fraud, but it also requires a trusted third party to administer it,” was how Wired magazine described the problem, in a 2011 expose titled: “The Rise and Fall of Bitcoin.”

The Power of Distributed Currency

Bitcoin did away with the third party by publicly distributing the ledger, what Satoshi Nakamoto, Bitcoin’s designer, or some believe a pseudonym for the design team, called the “block chain.”

“Users willing to devote CPU power to running a special piece of software would be called miners and would form a network to maintain the block chain collectively. In the process, they! would al! so generate new currency. Transactions would be broadcast to the network, and computers running the software would compete to solve irreversible cryptographic puzzles that contain data from several transactions,” according to the aforementioned Wired article.

Furthermore, Bitcoin values are artificially set, partly through complicated mathematical algorithms and partly by what people think they should be worth at any time. The algorithm limits the total number of Bitcoins ever mined to 21 million units, an amount expected to occur by 2140. This fact has caught the attention of those seeking inflation hedges because the money supply is preset at a steady, predetermined rate, which makes it a deflationary currency. And in fact, Bitcoin has been sought out by people in countries experiencing inflation seeking wealth preservation, such as in Argentina.

But one of the main challenges of Nakamoto’s design is achieving price stability so that Bitcoin could really be a medium of exchange or store of value. The price of a Bitcoin has gyrated between $14 and $1,200 in the span of a year. The most recent decline was on the news that the Chinese government in early December announced it would bar financial institutions from transacting with Bitcoin—one of the first overt moves by a central bank to bar adoption, and perhaps tacit recognition of the technology’s potential to disrupt world currencies.

However, another interpretation is that in allowing Bitcoin transactions among people and businesses, China has actually legitimized the currency (at least more so than US dollars), where the greenback can’t be owned or exchanged for the renminbi by citizens.

Meanwhile, other countries and institutions have taken a more enlightened view. The German government and the International Monetary Fund have said they regard Bitcoin as a “private currency,” and Fed chairman Ben Bernanke said virtual currencies “may hold long-term promise.”

Th! e Threat ! from Central Banks

Central banks around the world may seek to contain Bitcoin as a payment system. China in its announcement specifically challenges the legitimacy of Bitcoin as a currency in its move to bar financial institutions or accounts, but nonetheless will allow Bitcoin as a payment system.

In fact, adoption is your correspondent’s chief concern. The barring of access using traditional bank accounts is obviously a major barrier. Moreover, Bitcoin clone currencies are vying for the top spot. But some argue that Bitcoin has achieved critical mass or momentum in large-scale adoption to keep competitors at bay.

Bitcoin’s capitalization, valued by Bank of America (NYSE: BAC) recently at $15 billion, has already surpassed the money supply level of several small nations put together. Adoption by people in various countries (China represents 65 percent of market trades) and the expansion as a payment system to retail outlets (70,000 online shops via Shopify now can add Bitcoins as payment methods) could eventually stabilize the price with greater adoption.

The greater acceptance of Bitcoin as a payment system would prevent central banks from creating exchange rate incentives or other punitive measures that would prevent currency conversion between Bitcoin and a home country currency.

According to Torsten Hoffmann, entrepreneur and Bitcoin investor, “I don’t think governments will be able to control Bitcoin or create incentives to limit its use. The market today is already quite liquid, but the traditional banking system lobbying against it or preventing exchanges from having bank accounts make it difficult to get money in and out of Bitcoins.

“Remember, ultimately no government can control your software on the PC, or your password that you have written down somewhere. It is impossible to really stop, even though there may be some ways to block access via the exchanges, i.e. the places where you trade paper money for Bitcoins. So the! weakness! in the system is moving in and out, that’s the point of failure. But given its international use, and more and more ecommerce companies accepting Bitcoin, this won’t be a huge problem after 2015,” argues Hoffmann.

Further, Hoffmann does not believe that Bitcoins represent any major threat to central banks. “Probably more dollars are traded every second than Bitcoins in four years. I don’t have data, but I assume that the value of Walmart and Amazon gift cards or some air mile loyalty programs are larger than the value of Bitcoins. These also offer a certain store of value, and can be considered private money, which are used to transact value,” he says.

Meanwhile, for many in the Bitcoin world, the core issue is ease of adoption and not security. Bitcoin proponents argue that while Bitcoins in digital wallets can be stolen if they are entrusted to a shady third party or not properly secured, the system itself is extremely secure.

To trick the Bitcoin network (for 10 minutes) you need the computing power of the top 500 supercomputers times 256, according to Hoffmann and other experts. With respect to illicit activities, Bitcoin proponents argue that there’s nothing special here. Just as with cold hard cash, the money can be traced when directed through bank accounts and can even be confiscated like cash by authorities—simply by hauling away the hard drives.

The Internet’s Coin of the Realm

Some critics of Bitcoin have said that one issue as a store of value is the stratospheric appreciation that’s possible. Because the currency appreciates with more users, the cost of buying Bitcoins could become prohibitively expensive. But a Bitcoin can be subdivided into eight decimal places, allowing the currency to still be accessible to late adopters, although early adopters would be rewarded.

At the very least, Bitcoin has the potential to disrupt established payment system processors such as Western Union (NYSE: ! WU), and ! to the other extreme, change the global financial system as we know it.

While Bitcoins themselves in their present state of development aren’t suitable as an investment or inflation hedge, there are ways for investors to play this trend via established companies. Internet companies that accept Bitcoins as a system of payment are your best bets.