"Recent price weakness in AT&T (NYSE: T) is presenting investors with a high-yield bargain for conservative investors," says Ivan Marchev in Leeb's Income Performance Letter.

"AT&T, a holding in our income portfolio, has had a tough 2008 so far. Its performance has been good in a price-sensitive business environment, despite evidence of greater pressure than expected from both the slowing economy and increased wireless competition.

"So why would anyone consider a phone company given the unfavorable economics? Earnings estimates for AT&T have been cut for the next couple of years due primarily to assumptions of sluggish economic growth in the U.S.

"The answer is that those developments are already reflected in the stock price. The shares now trade at a big discount to the S&P 500 despite similar long-term earnings growth potential of 8-10%. That growth will come particularly from data usage over mobile phones.

"The original Apple iPhone contract went to AT&T and there has been a burst of new product offerings of other so-called 'smart phones,' which are very data intensive. This will drive data usage rates considerably in the next five years.

"What's more, AT&T now pays a rich dividend yield of 5%, more than double the S&P 500. We like the stock for conservative, buy-and-hold income investors."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

AT&T (T): Conservative income for buy and hold investors originally appeared on BloggingStocks on Thu, 18 Sep 2008 14:30:00 EST. Please see our terms for use of feeds.

"Shipping stocks can be a good port in a financial storm," says Ivan Martchev in Leeb's Income Performance Letter. Here, the advisor looks at Teekay LNG Partners (NYSE: TGP).

"Some shippers take their chances in the spot market; these should be avoided. Teekay, however, offers a high yield and lower earnings volatility due to its lower-than-average exposure to the spot market.

"Teekay is well exposed to the growing market for liquidified natural gas (LNG). The growth profile of the LNG market is compelling. The vast majority of the world's natural gas reserves are stranded in Eurasia and the Middle East, while consumption is greatest in the U.S., Far East and Europe.

"Imports of LNG to the U.S., for example, are expected to increase by more than 400%, by some estimates, between now and 2012. Clearly, there is wide-eyed potential growth in the LNG market.

"There are also high barriers to entry in its transportation since it requires huge investments in loading and reliquification terminals for highly specialized ships. Given the support of its parent company -- Teekay Corp. -- Teekay LNG Partners is a force far larger than its relatively small size would have your believe at first blush.

"The company's growth is virtually assured for years to come due to the imbalance in the geographic distribution of reserves and consumers of natural gas. Teekay LNG Partners, yielding 7.7%, is a publicly-traded master limited partnership, which means you should look into the peculiarities of tax treatment of distributions."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

Teekay Shipping (TGP): A 'port in a storm' originally appeared on BloggingStocks on Wed, 14 May 2008 12:35:00 EST. Please see our terms for use of feeds.

"Finding the right natural resource at the right time can be spectacularly rewarding," notes Ivan Martchev. One such opportunity according to the resources advisor may be palladium.

Here, the in his Vital Resource Investor he looks at the overall market for the metals and a pair of mining plays in this specialized sector - Stillwater Mining (NYSE: SWC) and North American Palladium (ASE: PAL)

Martchev explains, "Palladium is the only one of the precious metals that still trades nearly 70% below its 2000 high. While that in and of itself doesn't suggest that palladium is undervalued, I think it has great potential."

He points out that the platinum group metals (PGMs) -- platinum, palladium, osmium, ruthenium, iridium and rhodium -- have unique characteristics as industrial metals. The most well known, he observes, is their use in catalytic converters for automobiles.

Indeed, he notes, the catalytic converter market drives platinum and palladium. He explains, "The recent bid under palladium is very much an expression of environmental concerns and tightening legislation worldwide on emission standards, which is likely to get tougher and tougher.

Meanwhile, he points out, "Only platinum and palladium have dedicated miners, while the rest of the PGMs are byproducts of platinum and palladium mining." And, he adds, the majority of PGMs are found in South Africa and Russia.

How do you play it as a US-based investor? He suggests that there are two primary North American miners that deal in PGMs, one in Canada, one in the US. The only US-based producer, he says, is Stillwater Mining (NYSE: SWC).

Continue reading Palladium plays

Palladium plays originally appeared on BloggingStocks on Thu, 28 Jun 2007 08:30:00 EST. Please see our terms for use of feeds.

While investors and pundits debate the impact of ethanol on our long-term energy problems, one thing is clear according to Ivan Martchev -- the popularity of ethanol is having a "huge impact" on agribusinesses.

The editor of Vital Resource Investor explains, "Whether ethanol makes economic sense is less irrelevant. It is having an effect on farming." Indeed, he believes one of the best ways for investors to play the popularity of ethanol is to focus on farming equipment.

Within this market, he notes that the obvious choice for investors is industry leader Deere & Co. (NYSE: DE). However, he cautions that the stock already reflects investor optimism.

In addition, he notes, "The stock recently traded at $114, and many individual investors dislike buying triple-digit stocks." Therefore, he notes, he looked for a "worthy adversary to Deere" and found Case New Holland, whose name was recently shortened to CNH Global NV (NYSE: CNH).

The advisor calls CNH a restructuring story. He notes that the company is majority owned by Fiat, which is itself recovering from a "dire situation" two years ago.

Continue reading CNH: A farming alternative to Deere

CNH: A farming alternative to Deere originally appeared on BloggingStocks on Sun, 06 May 2007 15:00:00 EST. Please see our terms for use of feeds.

You won't see the contango on Dancing with the Stars; rather its a term used in the futures market to describe the difference in value when the price of a commodity for future deliver is higher than its spot price.

It's also the reason why resource expert Ivan Martchev thinks the US Oil Fund (NYSE: USO) is an excellent short-term trading vehicle but a "terrible" long term investment.

The editor of The Vital Resource Investor explains, "Geopolitical events going on in the Middle East are bullish for oil prices but not necessarily bullish for oil stocks. How come? An attack-driven spike in oil to new highs (proportionately more so the longer the conflict) would likely slow a slowing economy even more."

As a result, he notes, investors should not ncessarily expect to see quick gains in oil stocks if the oil price spikes. He notes, "In conflict-driven spikes that are presumed to be temporary, oil stocks in the past have tended to divorce themselves from the price of oil."

Rather, to play a short-term spike in oil price, the advisor prefers the US Oil exchange-traded fund. As noted at the start of this post, he explains, "USO is a terrible buy-and-hold idea because of the contango in oil futures."

Continue reading Oil expert dances the 'contango'

Oil expert dances the 'contango' originally appeared on BloggingStocks on Thu, 05 Apr 2007 09:00:00 EST. Please see our terms for use of feeds.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

International Coal Group, Inc. (NYSE: ICO) is the top speculation for 2007 from Ivan Martchev, editor of Vital Resources and contributing editor for Personal Finance.

He explains, "The company came to market through an initial public offering at $11 and shortly thereafter had a high-profile accident at one of its mines that was probably the result of a lightning strike causing a methane explosion. Some bad operational news further pressured the stock, which reached $4 in the fall.

"As a result, International Coal is a lot cheaper based on book value and price-to-sales measures compared to major coal stocks. My interest here stems from the fact that Wilbur Ross -- a man with a proven record -- has a lot of money at stake in the company.

"If Ross can put together a bunch of bankrupt steel producers like Bethlehem Steel and make a go of them - and ultimately sell them very profitably- he'll try to make a go of International Coal. This is a suggestion only for the patient; it may take a couple of years for International Coal to dig out of its current hole (no pun intended). Buy under $6.50."

To see Ivan's top conservative investment for 2007, click here.

Top Picks 2007: Ivan Martchev fires up the Coal Group originally appeared on BloggingStocks on Fri, 29 Dec 2006 08:30:00 EST. Please see our terms for use of feeds.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

Kraft Foods (NYSE: KFT) is the top conservative investment for 2007 from Ivan Martchev. The editor of Vital Resources and contributing editor to Personal Finance explains, "Despite having an impressive collection of food brands, Kraft has been a disappointment to investors since it sold shares as an independent company in 2001.

"The IPO price back then was $31; today the shares are in the mid $30s. So why look at Kraft? Altria bought Kraft in 1988 to diversify away from tobacco, as the skies were darkening on tobacco litigation. As the litigation environment is improving, and speculation is that Altria will finally spin off its non-tobacco business -- it owns 276 million Kraft shares -- this should allow it to be fairly valued by the market.

"Some conglomerates suffer from a diversification discount. It's believed that if the parts are separated, the total market value of its stocks together will be higher than the parent company's stock itself. One reason why Kraft has underperformed despite its large portfolio of well-established brands is the pressure from raw materials costs that it couldn't pass on to consumers in the form of higher prices.

"The company recently hired a new CEO, Irene Rosenfeld from Frito-Lay, to come up with a strategy out of this predicament. Since Frito-Lay had excellent financial performance while Rosenfeld was CEO, there is good reason to believe that she is the right person to fix Kraft. With better management and the pending Altria spinoff, Kraft is a buy at current prices."

To see Ivan's top speculative idea for 2007, click here.

Top Picks 2007: Martchev sees spin-off boost Kraft originally appeared on BloggingStocks on Fri, 22 Dec 2006 08:30:00 EST. Please see our terms for use of feeds.