Gold Stocks Price 2012

Gold Stocks Price 2012: AeroVironment (AVAV)
By Gregg Early



Technology expert Gregg Early looks to AeroVironment (NDSQ: AVAV) as his top pick for the coming year.



The editor of The New Tech Investor -- and the soon-to-be-launched 2020 Portfolio -- explains, "Although the firm's miltary aerospace business should be strong, it is the firm's new 'clean technology' and energy e?ciency projects that should be the real growth kicker.



"AeroVironment started on 2012 strong but it was hit in the spring by the global economic collapse and the irrational fears of investors -- both individual and institutional -- about what the future held in store for this unique firm.



"But 2012 should be the perfect climate for this company to continue is comeback and head to new highs.

Permalink: [590] Top Stocks To Buy - Gold Stocks Price 2012

"AeroVironment was founded by the father of human powered flight, Dr. Paul MacCready (1925-2007), the inventor of the human powered Gossamer Condor and Gossamer Albatross (which was flown across the English Channel and resides in the Smithsonian Air and Space Museum).



"MacCredy also developed the first solar powered aircraft, the Gossamer Penguin and the Solar Challenger. He also co-developed the GM Sunraycer, one of the first solar powered land vehicles.



"His revolutionary developments in aerospace design were put to good use in AeroVironment's unmanned air systems (UASs) division. The company's hand launched and micro UASs are deployed extensively in Iraq and Afghanistan with special forces units and well loved by the troops who rely on them.



"While general defense spending is on a downtrend, C4ISR (command, control, computing, communications, intelligence, surveillance, reconnaissance) budgets are increasing briskly across all the armed services as well intelligence and homeland security sectors.



"This business has sustained AeroVironment in the past and will continue to generate more business in coming years. But it E?cient Energy division is the real growth kicker.



"The company pioneered electric vehicle (EV) charging stations and has a long and abiding relationship with many car manufacturers as well as government agencies.



"As EV filling stations begin to dot the US landscape--and that development is already growing briskly in the West -- AeroVironment will be a significant player.



"Also, because the stimulus plan had the unintended e?ect of holding up cleantech projects as everyone waited to see who would get government money, it made 2012 a tough year for cleantech.



"Now that the monies have been earmarked, projects will move ahead faster now that companies have better visibility on where the funding will be derived. AeroVironment is a buy up to 35."





Gold Stocks Price 2012: AboveNet, Inc.

by Neil Macneale, editor 2 for 1 Stock Split Newsletter



AboveNet, Inc. (ABVT) is my pick for the single best stock for 2012. AboveNet provides broadband services to commercial and government clients requiring secure, very high-speed connections between major metropolitan areas in the US and the UK.



AboveNet's fiber-optic network is utilized by financial institutions, media companies, social networking companies, law firms and medical and health care institutions. ABVT is highly profitable with strong cash ?ow and a solid balance sheet. ABVT does not pay a regular dividend but did declare a special one-time payout of $5.00 per share in November, 2011, indicating a high level of confidence as to future sales and earnings.



AboveNet appeals on several levels.

1. The business of providing high-speed connectivity is booming and can only grow as more and more companies become dependent on Web-based applications, data mining and storage, global supply chains, etc., etc. AboveNet is very well positioned to capitalize on this growth.

2. With a PE of less than 6 and a price-to-book ratio at around 2.2, ABVT seems underpriced at its current $57 level.

3. Somewhat akin to a mining company, AboveNet's most important assets are in the ground, i.e., its fiber-optic cables are in place, paid for, and will only grow more valuable as demand for broadband capability grows.

4. ABVT stock is far less volatile than the overall market, something all investors should be looking for in 2012.





Gold Stocks Price 2012: Altria (MO)

By Kelley Wright



"My definition of safe is to avoid cyclical companies that can be derailed by unexpected economic events or a sudden change in Fed policy," says dividend expert Kelley Wright.



In Investment Quality Trends, he suggests, "Additional requirements are a long history of increased earnings and dividends, broad institutional sponsorship, and ample outstanding shares for trading liquidity. One such company that fits that bill is Altria Group (NYSE: MO), my top pick for 2012.



"As attention turns toward 2012, the annual dilemma of 'what do I do now' moves front and center. With the Fed ostensibly sticking to its 'for an extended perio'” mantra, the conventional wisdom is that the recession is behind us and all will remain well as long as interest rates remain low and liquidity plentiful.



"While the recession may indeed be over, under the technical definition anyway, and it is investment suicide to try and fight the Fed, the ever-ubiquitous Wall of Worry is steep enough to approach the new investment year with caution. In that vein, my instincts and experience are to play it safe.



"My definition of safe is to avoid cyclical companies that can be derailed by unexpected economic events or a sudden change in Fed policy.



"Altria Group is a holding company whose operating companies include Philip Morris USA, U.S. Smokeless Tobacco Company, John Middleton and Ste. Michelle Wine Estates. The company’s brand portfolio consists of successful and well-known brand names such as Marlboro, Copenhagen, and Skoal.



"Trailing twelve months earnings for MO are $1.53 per share, and, based on the recent price of $19.15 per share, the P/E is in the mid-12 range. The cash dividend of $1.36 per share provides an outstanding dividend-yield of 7.10%.



"With a payout ratio of about 88% ($1.36 of the $1.58 ttm earnings are paid out in dividends), some investors who have seen some dividends slashed or eliminated over the past year may balk at such a high dividend-yield.



"The key to a healthy dividend though is free cash flow and a high return-on-equity (ROE). Altria Group converts about 16% of its revenue into free cash and its ROE is well above average.



"The IQ Trends Profile of Value for Altria Group is dividend-yield extremes of 7.0% and 4.0% respectively. Accordingly, whenever the dividend-yield for Altria Group is within 10% of 7.0%, the stock represents good historic value and is appropriate to purchase.



"When the dividend-yield declines to 4.0% ($34 based on the current dividend), the stock has reached its historically repetitive area of overvalue and profits should be harvested."



Gold Stocks Price 2012: Apple

by Stephen Quickel, editor US Investment Report



After its two-year romp from 85 to 320 you might be leery of buying Apple (AAPL). The stock's advance has slowed noticeably since topping 300 in October. Even so, we regard Apple as one of our top picks for 2012 -- destined to crack above 400 in the year or so ahead.



True, the autumn surge in trading volume has abated since carrying AAPL above 300 (from our November 2008 entry price of 87).



But the stock deserved a rest after its 33% run from 240 last summer. And while taking a breather, it has never closed below 300 since first hitting 320 in early November.



It brie?y touched it 50-day moving average just before Thanksgiving, but as of Dec. 20 had regained 320 on fairly moderate volume. From our vantage point, that's just the beginning of its next major move.



The obvious driver is Apple's continued outpouring of brilliant new products. But upgraded versions of its iPad and iPhone, plus other attractive new o"erings, are only part of our rationale for Apple's move to 400 and beyond.



They will keep the competition at bay--and keep earnings growing by the expected high teens percentages (First Call projects 20% a year five-year growth). To us, the stock's biggest attraction right now is its bargain-basement valuation.



It's incredible that this growth stock to beat all growth stocks today trades at just 14.5 times estimated 2012 earnings of $19.19 per share. And at an amazing PEG ratio (P/E divided by earnings growth rate) of 0.80 based on 18% a year growth. A PEG of 1.00 is considered ideal, making AAPL's 0.80, if you will, super ideal.



Here's the icing on the cake: We believe AAPL deserves to trade at a forward P/E at the 18 level ; the stock s, and should easily reach that in a buoyant economy. With earnings of $22.20 now projected for 2012, we see a price target of $400 sometime in 2012 or just beyond, up 25% from today's level. The current consensus guesstimate of 14 sell-side analysts calls for earnings of $24.63 in 2013. You can do the rest of the math for yourself.







Gold Stocks Price 2012: BCE (BCE)

By Vivian Lewis



Given her concerns about overall market valuaton, global expert Vivian Lewis is selecting her top pick from among stocks she calls "dividend payers and fallen angels".



In her Global Investing newsletter, she explains, "I consider BCE (NYSE: BCE), with its 6% yield, a great buy." Here's her review of the Canada-based telecom company.



"I'm worried about the speculative coloration of the rise in stock prices globally since the bottom in March 2012. I do not think the markets will continue rising as they have since then, in a straight line to the upper right-hand corner of the page.



"I expect a serious correction because the global economy is still mired in di?culty. There will be more bad news taking share prices down in the coming year.



"To find stocks with ballast for the sell-o? I expect in 2012, I am focusing on dividend payers and fallen angels. Fallen angels have risen less sharply than companies without damaged reputations, and pay out more.



"A year after crash of BCE, the Canada telco supposed to have been taken private by Ontario Teachers Pension Plan and US partners, who pulled out, the former Bell Canada is a good buy.



"The deal collapsed in the financial crisis. BCE CEO George Cope valiantly then cut 2500 jobs; did a wireless deal with Telus and bought out the remaining half of Virgin Mobile Canada; bought electronics store chain The Source; and boosted BCE dividends.



"BCE stock has risen 30% this year in loonies (C$s) and nearly 50% in US dollars. (It trades as BCE both in Toronto and on the NYSE.) But it is still a third cheaper than the former deal price target. That reflects investors' bad memories. Most analysts rate it neutral despite their expecting it to rise to $29.50.



"Further hurting BCE was the decision on Dec. 11 by Canadian regulators to allow Globalive to o?er cellular phone service throughout Canada, reversing an earlier bar on the company part-owned by Orascom of Egypt.



"While the 2012 Xmas telephone market will not see many o?ers from Globalive, next year there will be cellphone price cuts. This could hurt BCE's gross margins, which are at an astonishing 74%.



"However, other telcos without BCE's land-line and multiple cellular options will be hurt more. I consider the stock a great buy yielding 6% with a probability the dividend will be raised."










Gold Stocks Price 2012: Canadian Oil Sands Trust

by David Dittman, contributing editor Canadian Edge



Canadian Oil Sands Trust (COSWF) has clearly lagged broad-based and energy-sector benchmarks alike over the trailing 12 months. A series of unplanned turnarounds at the Syncrude operation, of which Canadian Oil Sands owns 36.7 percent, have analysts questioning whether rising costs will ever allow Canadian Oil Sands to really benefit from elevated oil prices.



And the very skeptical wonder if actual output will ever match Syncrude's capacity potential. All in all, after years of hype and outperformance the bar is now set rather low for Canadian Oil Sands. The stock is likely to revert back to its usual pattern of trading in sympathy with crude oil prices, a relationship that did break down in 2011.



New demand from Asia, old demand in the developed world and a desire from investor for hard assets will keep the per barrel price of oil elevated over the next 12 months.



Canadian Oil Sands will restrain the excruciating growth of unplanned turnaround costs, and Syncrude will get on the path to realizing its potential.



At the new rate of CAD0.20 per share per quarter, the stock will yield about 3 percent. The stock has taken a hit in the second half of 2011, and management has shown it will boost the payout to re?ect upside oil-price surprises. Soon-to-convert Canadian Oil Sands Trust is a solid total return play on one of the world's most intriguing resource stories, set up for capital appreciation as well as dividend growth. Buy it up to $28.





Gold Stocks Price 2012: Catlin Group

by Vivian Lewis, editor Global Investing



Insurers benefit when things go wrong. That explains our latest pick, Catlin Group (CNGRY). Incorporated and regulated in Bermuda, listed primarily in London as CGL, the stock's ADR is equal to two British shares.



It is the largest syndicator at Lloyd's of London, the reinsurance business. It's also a favorite holding of institutional investors.



It very conservatively invests its premiums, in cash and fixed income with only 2.5% in hedge funds, yet it managed to produce a return on equity of 1.8% in H1 and of 2.9% in 2009 and Q3.



It keeps raising its dividend, more steadily if you buy in sterling than the ADR. Given its current yield of 6% I'm satisfied with the payout but Citigroup analysts say it will go to 7.7%..



It's a family businees, under CEO Steve Catlin, established as a Lloyd's underwriter in 1984.



It's green, funding the Catlin Arctic Survey to measures the thickness and density of ice foes in the Arctic Sea and carbon dioxide absorption (ocean acidification). Nice but not why to buy.



Rather, you should buy because Catlin is a globally diversified insurance business operating 88-89% in US dollars. It is quick to develop new businesses to benefit from macro-economic trends.



It shifted its casualty lines from insuring British solicitors and surveyors, to hot button more profitable US insurance lines: medical malpractice; directors and o#cers (D&O) insurance; cover for architects, engineers, and construction and design professions; and environment risk.



Catlin justifies these new lines (priced by its experienced actuaries) as "short tail" controlled latent risk cover for underserved niches.



Longer-tail risk is very selectively underwritten by Catlin based on claims made. (Tails refer to the extremes of a normal curve, the unexpected events. Longer-tails mean unexpected payouts.)



"Crysalis" is innovative oil production insurance, launched in Feb for oil and gas drillers. New business is booming post-Gulf of Mexico, and not just from US drillers.



BP's disaster explains the rush for Crysalis cover. BP had a Bermuda "captive" (self-financed) insurance firm.



What it will be able to collect for its captive, say industry sources, is $1.5-3.5 bn. Against this, the economic loss from the Gulf disaster is $40 bn. And since the Macondo sank, BP shareholders losses from the stock's drop topped $73 bn, a compelling argument for buying insurance. Crysalis standard contracts cap the amount of cover per event at $200 mn, and per company at $100 mn, shortening the tail.



Not everything went Catlin's way. Its first half earnings were nipped 8% from prior year by Chilean earthquake claims and the Gulf of Mexico. However, we had a benign hurricane season.



And for all the dollar's appeal, getting a decent investment return is not easy in the present QE2 environment.



If in?ation takes o", claims will be higher and coverage from investment income lower. But then Catlin can raise its premiums. And it may have shifted the policies it o"ers into another currency.



Citi expects the total payout next year for this "undervalued" (rated low risk, high return) share to come to 23.4% in sterling, and 16.6% in dollars at its target price of $12.80. Citi's 2011 profit forecast is $369 million, vs $243.8 million in 2009 and $384.9 million in 2008. (Per share, the hit was even greater in 2009 because Catlin did a rights o "ering to invest more during the crisis.).



Its Sept. quarter saw Catlin premium income up 9% and earned income up 13%. Market cap is $1.982 billion, with the ADR stock at $11.50. It has an A.M. Best A rating from the insurance watchdog.



Its combined ratio, a key metric, is 97% -- meaning expenses are 97% of premium income so underwriting was 3% to the good before any investment income. Buy CNGRY.







Gold Stocks Price 2012: China Digital TV (STV)

By Glenn Cutler



"My top pick for 2012 is China Digital TV Holding Co Ltd. (NYSE: STV), the #1 provider of conditional access (CA) systems in China’s digital TV market," says Glenn Cutler.



In his Winner Forum and Special Situations Reports, he explains, "I consider this a conservative idea to play the China market through an established company that dominates its business sector.



"China Digital TV Holding is based in Beijing, China and was founded in 2004. They are in a strong position to leverage their current 50% market share in China. Of 375 million TV households across China, 168 million are cable subscribers with an additional 10 million added each year.



"With only 54 million smart cards shipped industry wide, there is ample opportunity for growth, market share expansion and royalties and revenue sharing with cable operators. They have over 225 customers, with roughly 30 of them providing over 1 million subscribers each.



"Currently, their CA systems consist of smart cards (90% of revenue) and head-end software for television network operators, as well as terminal-end software for set-top box manufacturers.



"They enable digital television network operators to control the distribution of content and value-added services to their subscribers and block unauthorized access to their networks.



"The company also licenses its set-top box design to set-top box manufacturers and sells advanced digital television application software, such as electronic program guides and subscriber management systems to digital television network operators.



"There are several reasons why the stock price has been trading near its annual lows. Recent revenues have been under pressure and earnings have been soft due to the postponement of digital migration projects as cable operators wait for greater clarity with respect to industry consolidation and subscription fee adjustments in certain regions.



"The company has faced pricing pressures and they’ve reduced selling prices at times as a tradeo? for gaining new customers in less populated areas.



"These factors have led to downgrades by some analysts. Earnings for 2012 are expected to be .42/share down from .72/share in FY2008. Expectations are low as earnings projections for FY2012 are estimated to be flat at .42/share.



"China Digital has a solid financial structure with $225 million in cash ($3.87/share) which was reduced by distribution of a $1 per share special cash dividend in Feb/ 2012. The balance sheet is solid with zero debt. They maintain a strong market position for continuing growth.



"The company intends as a policy to consider special dividends every two years. The current market cap is $348 million. Trailing 12-month profit margins are 54%.



"Book value is $4.25 a share. The P/E Ratio is 11. There are currently 58 million shares outstanding. The shares are trading close to their 52-week low, within a yearly range of $5.60 (low) to $11.80 (high). Return on equity is 12%.



"With expectations low, there is potential for upside surprise if digital migration projects start to accelerate. With shares trading at about $2 above their cash position, downside risk is partially mitigated. The company could use cash on hand to acquire productive assets should attractive opportunities arise to compliment their product o?erings or consolidate their industry sector.



"As a conservative way to play expected growth in China, this company o?ers an excellent low-risk technology angle for a 2012 stock portfolio. A good upside target range over 12-months would be $8-$10."





Gold Stocks Price 2012: Dyadic International

by Andy Obermueller, editor Fast-Track Millionaire



The "sleeper" story of 2012 will be cellulosic ethanol, a biofuel made from the sugar in plants (instead of the starch in corn).



New EPA rules increase the amount of ethanol that can be blended with gasoline by +50%, and federal law calls for the nation to produce gobs of this so-called "advanced biofuel." The output table calls for millions of gallons today but for 16 billion gallons by 2022, which is a impending demand surge no industry can match.



Any old plant will do, from agricultural waste to scrap wood or even recycled paper. The kicker: To be used, the plant material must be mixed with special enzymes to tease the sugar from the plant cell walls, or all you have is a pile of worthless mulch. The leading enzyme maker? Dyadic International (DYAI) .



What will fuel its growth? An increased global production of enzyme-dependent cellulosic ethanol made from any plant matter, not just from corn. The company will also see demand from new bio-pharmaceutical manufacturing systems, and other licensing deals in an array of manufacturing applications, from animal feed to wine production.



Many major oil companies are already investing heavily in this area. It's the inevitable future.



Long-term, Dyadic's revenue should soar. It doesn't have to invest to build the plants. It doesn't have to sell the ethanol itself.



It's a vendor, not a partner, and it's willing to sell its enzymes worldwide to anyone willing to pay for them. And that's why I love this stock. In my view, it's a "screaming-for-Pete's-sake-and-tell-your-friends" buy at prices less than $2.00.





Gold Stocks Price 2012: Emerson Radio (MSN)

By Bill Matthews



"Emerson Radio (NYSE: MSN) is an atttractive, low-priced stock," says Bill Matthews, a specialist in lower-priced issues.



The advisor, who has been publishing The Cheap Investor for nearly 3 decades, suggests, "The stock has the potential for significant appreciation in 2012."



"In this market, we wanted to recommend a quality low priced stock that is relatively safe, has good increasing revenues and outstanding earnings. We are also looking for a stock that is selling at an attractive low price, and has the potential for significant growth and stock appreciation in 2012. Emerson Radio fits these criteria.



"Emerson Radio is a household name. Together with its subsidiaries, it engages in designing, marketing, selling, and licensing various consumer appliance, electronic and house ware products.



"It products are sold in the United States and internationally. Emerson Radio Corp. markets its products under the Emerson and HH Scott brands.



"The company distributes its products primarily through mass merchandisers, discount retailers, toy retailers, and distributors and specialty catalogers in the United States.



"Emerson has an excellent balance sheet with $29 million or $1.06 per share in cash, a book value of $2.25 per share and less than $6 million in debt. Insiders own 65% of the 27 million total shares outstanding and 22 institutions own 17% of the float.



"Emerson has excellent financials for the six-month period ended September 30. Revenues are $107 million up from $97 million a year ago. Net income is $4.3 million or $0.16 a share up from a loss of ($242,000) or (.01) a share verses a year ago.



"If you look at Emerson’s stock chart between June 2002 and June 2003, you’ll see that the price soared from $1.50 to $7.50 because of excellent revenue and earnings increases. We believe, that if Emerson continues its earnings growth, the price could skyrocket again."





Gold Stocks Price 2012: Equinix (EQIX)

By Stephen Quickel



"Equinix (NASDAQ: EQIX), the global data center operator, is one of the most tempting growth stock opportunities on the 2012 horizon," says Stephen Quickel.



The editor of US Investment Report explains, "Big banks, market data providers, telecoms and other technology-driven clients use the firm's data center platforms to reduce their own capital expenditures and operating costs.



"The Silicon Valley-based company, barely ten years from startup, has moved quickly to open 45 data full-service centers serving clients in 18 key regions of the U.S., Europe and Asia-Pacific areas.



"These centers provide data management services to global enterprises of all sorts, including content and financial companies and network service providers,. "With demand rising rapidly, Equinix, has been able to lift revenues from $118 million in 2003 to $705 million in 2008, and to an estimated $880 million in recessionary 2012. Analysts project $1.17 billion in 2012—a two-year rise of 67%.



"As for earnings, the rapidly expanding company showed deficits for its first eight years, but reduced them in all but one year. Now firmly in the black and established as a sector leader, its gains could be large over the next few years.



"Rapid expansion of its IBX centers (short for International Business Exchanges) has required considerable debt. The latest available debt/equity ratio is an elevated 1.27.



"But capital spending is leveling o?, and Smith and his managers have kept of tight rein on operating costs.



"Earnings have risen 26 quarters in a row. After tax margins are reportedly at a four-year high. Third quarter 2012 earnings jumped 213% year-over-year, beating analyst estimates by 57%.



"Zacks reports consensus five-year earnings growth projection of 18.4% a year going forward. First Call shows earnings up 26% in 2012 and more than 40% in 2012.



"Those eye-catching numbers have not gone unnoticed. EQIX is not cheap by conventional measures. At 105 in late December (up from 40 in March), it traded at 51 times FC’s 2012 earnings projection and 34 times its 2012 estimate.



"But the stock has impressive support. Among 26 brokers—a large following for a young $4-billion market cap stock—15 rated it a Strong Buy in December, 3 a Buy and 8 a Hold, with no Sells.



"Goldman Sachs, altogether, owns 12.5% of the outstanding shares, with Wellington Management and Shumway Capital Partners each holding 8%-plus. Wells Fargo, Barclays, Morgan Stanley and Vanguard also have large positions.



"Of course, the Big Boys bought in at lower levels and have added shares along the way—and will doubtless continue to do so.



"With its high debt and P/E, it’s not the kind of play-it-safe stock that attracted investors in late 2012. But as we head into 2012, few mid-caps have emerged with more fascinating near- and long-term growth possibilities."









Gold Stocks Price 2012: RealD

by Mike Cintolo, editor Cabot Market Letter





To choose my top stock pick of the year, I looked for new stocks (recent IPOs are usually under-owned by institutions, which can help the stock price) with big ideas. It's hard to find an idea much bigger than RealD (RLD), a play on the popularity of 3D movies.



The company is the leading provider of 3D technology to theaters and TV makers. At the end of September, 9,300 movie screens were using its technology.



In addition, another 2,000 movie screen are likely to be converted in the fourth quarter. Yet RealD is just scratching the surface of its potential, as tens of thousands of screens around the world are likely to move to 3D in the quarters to come, and since the firm gets paid on a per-ticket or per-movie basis, each installation creates a huge stream of income.



RealD isn't making money yet (though it's close), but revenues are ramping at 50%-plus rates as the company concentrates on grabbing as much market share as it can. And, longer-term, the 3D TV market could be a huge boost as well. As we said, it's a big idea, and the stock, which just came public in July, is o" to a good start. We think it will have a great 2012.





Gold Stocks Price 2012: Level 3 Communications (LVLT)

By Gene Inger



"Our bias has again shifted temporarily to the bearish side, which makes me cautious about picking stocks in early 2012," says Gene Inger. With that caveat in mind, the editor of The Inger Letter looks to the Level 3 Communications(NASDAQ: LVLT), s speculative, low-priced issue.



"We owned this stock years ago and when Level 3 bought Broadwing we got stock and cash; thus solid profits years ago or zero-cost basis on Level 3 shares. "After pundits hyped it (at triple current prices) the stock has dropped to an area of attractiveness. One caution: from sub-$1 levels during our forecast market panic a year ago, the shares have doubled; thus it's not impossible that 'capital gains taking' could suppress the stock somewhat early-on in the new year.



"Thus our buy-zone will be particularly wide; such as between 90 cents and $1.30 or so. One may elect to pay more and scale-in; though we’d prefer to buy in on pullbacks.



"Meanwhile, we note that their ability to service their debt should not be an issue presently; so we are interested to see what they do over the next year or two; not past 2012.



"Our original interest in Broadwing -- now absorbed by Level 3 -- was the all-digital-optical as well as transcontinental (now to Europe as well) fiber system.



"This system has no latency as still is common with satellite and many other systems (including most fiber networks).



"On top of that mobile carriers are increasingly looking to 'backhaul alternatives' to meet their increasing bandwidth needs, which should increasingly result in o?oading to fiber backhaul systems.



"The low latency is a reason why most sports and news networks are using Level 3 (two-way conversation reveals latency, whereas one-way conventional transmission doesn’t) for their HDTV broadcasts, and we believe that will increase in importance as 3D arrives eventually.



"Additional pluses in the fullness of time include bandwidth requirements in the Cloud Computing area; digitized medical record keeping; military uses (they have certain key Federal accounts) and certainly the growth of telecommunications in-lieu of physical travel.



"In the sense that reduced physical, and increased optical transport, is e?cient; that's actually a bit of a green' story as well."





Gold Stocks Price 2012: Longtop Financial (LFT)

By Timothy Lutt



"Longtop Financial Technologies (NYSE: LFT), our top pick for for 2012, was the first Chinese software company to list on the NYSE when its ADRs began trading in October 2007, and we're impressed by the progress made since then," says Timothly Lutts.



The editor of Cabot Stock of the Month Report explains, "Financial services industries are booming in China, and Longtop is a great way to benefit. We've long maintained that watching China’s growth in recent decades has been like watching a video of American history … but played at fast- forward speed.



"The transition from farming to industrial production was accomplished in one generation (in part by following the U.S. roadmap) and now the country is entering into the software era.



"Longtop Financial Technologies was founded in 1996 as a financial systems integration company, but made the transition to software and solutions in 2001.



"Today it’s the #1 developer of banking software in China and the #2 developer of software for the insurance industry. And now it's breaking into the securities industry; Longtop announced its first contract there in November.



"Longtop's main customers are banks; they accounted for 82% of revenue in the latest quarter. And its biggest bank customers (no surprise) are the 'Big Four' banks of China. These are the Industrial and Commercial Bank of China, the Bank of China, the China Construction Bank, and the Agricultural Bank of China.



"These four banks together hold more than 65% of domestic market share. For Longtop, three of them (it's working to get business from the fourth) accounted for 48% of revenues in the latest quarter.



"In China, of course, the banks are healthy -- none have gone bankrupt, or been bailed out by the government. And none are expected to. Yes, business has slowed a little, but the future is still expected to bring great growth. And as the banks grow, Longtop will, too.



"In addition to banks, Longtop serves the insurance industry and the financial departments of major non-financial companies, and there’s no reason those won't grow, as well. But banks are the company’s bread and butter and will be for the foreseeable future.





"Furthermore, Longtop, which spends 5.8% of revenue on R&D, has new projects starting frequently. Recent announcements include projects on anti-money laundering, e-banking, financial testing solutions, financial risk management and data warehousing.



"And then there are acquisitions. Longtop completed the acquisition of Sysnet in second quarter, and it’s currently working on an acquisition that would be its biggest yet.



"Technically, Longtop’s stock chart is encouraging. After coming public in October 2007 at 18, it peaked at 35 and then drifted slowly down over the next year (with the market), bottoming at 10 1/2 in November 2008. By late February, it had recovered to 15, and that’s when the big move of 2012 began that took the stock to a high of 38.



"Currently, it’s digesting that advance; it may pull back as far as 32, where we now find the 50-day moving average. And if it does I recommend that you treat the pullback as a buying opportunity.



"While the American banking industry struggles, the Chinese banking and financial services industries are booming, and Longtop is a great way to benefit from that boom."