At the most basic level, a share of stock entitles you to a share of profits -- and profits are what ultimately bolster a stock price. Recently, profits have been at all-time highs -- not only nominally, but as a percentage of GDP. Some observers believe this trend is unsustainable and that corporate profits will revert to their historical mean. And if profits do fall and revert to the mean, stock prices will fall as well.
Why does all this matter right now? Because profits this past quarter just fell by a significant amount.
The numbersAs a percentage of GDP, corporate profits have averaged 6.2% of GDP since 1947. Today, they hover around 11%. Against the recent upward trend, however, the latest quarter's profit numbers have fallen. Corporate profits after tax dropped 2% from the fourth quarter of 2012. That's the biggest drop since the first quarter of 2011, a year when the�S&P 500� (SNPINDEX: ^GSPC ) ended flat. The difference now, though, is that profits are even higher and have further to fall if they do revert.
Top Companies To Watch For 2014: Tranzyme Inc.(TZYM)
Tranzyme, Inc., a clinical-stage biopharmaceutical company, engages in the discovery, development, and commercialization of small molecule therapeutics for the treatment of acute and chronic gastrointestinal (GI) motility disorders in the United States and internationally. The company?s clinical product candidates include ulimorelin, an intraveneous ghrelin agonist, which is in the Phase III clinical development stage for the treatment of acute upper GI motility disorders; and TZP-102, an orally-administered ghrelin agonist that has commenced Phase IIb clinical development stage for the treatment of diabetic gastroparesis. Its preclinical product candidates comprise TZP-201, a motilin antagonist for the treatment of various forms of moderate-to-severe diarrhea; and TZP-301, an oral ghrelin antagonist for the treatment of metabolic diseases. The company has strategic collaboration with Bristol-Myers Squibb Company to discover, develop, and commercialize additional novel co mpounds; and a license agreement with Norgine B.V to develop and commercialize ulimorelin in Europe, Australia, New Zealand, the Middle East, and north and South Africa. Tranzyme, Inc. was founded in 1998 and is headquartered in Durham, North Carolina.
Advisors' Opinion:- [By CRWE]
Tranzyme Pharma (Nasdaq:TZYM) reported that it has closed the previously announced underwritten registered direct offering of approximately 3.0 million shares of its common stock at a price of $3.85 per share for gross proceeds, including the over-allotment option, of approximately $11.5 million.
Top Companies To Watch For 2014: Midway Gold Corporation(MDW)
Midway Gold Corp., an exploration stage company, engages in the acquisition, exploration, and development of mineral properties in North America. Its principal properties include the Spring Valley, Midway, Pan, and Gold Rock gold and silver mineral properties located in Nevada; and the Golden Eagle gold mineral property located in Washington. The company was formerly known as Red Emerald Resource Corp. and changed its name to Midway Gold Corp. in July 2002. Midway Gold Corp. was founded in 1996 and is headquartered in Englewood, Colorado.
Top Heal Care Stocks For 2014: Taylor Devices Inc.(TAYD)
Taylor Devices, Inc. engages in the design, development, manufacture, and marketing of shock absorption, rate control, and energy storage devices for use in various types of machinery, equipment, and structures. The company provides seismic dampers that ameliorate the effects of earthquake tremors on structures; Fluidicshoks, which are small and compact shock absorbers for primary use in the defense, aerospace, and commercial industry; and crane and industrial buffers for industrial application on cranes, ships, container ships, railroad cars, truck docks, ladle and ingot cars, ore trolleys, and car stops. It also offers self-adjusting shock absorbers that automatically adjust to different impact conditions for high cycle applications primarily in heavy industries; liquid die springs, which are used as component parts of machinery and equipment used to manufacture tools and dies; and vibration dampers that are primarily used by the aerospace and defense industries to contr ol the response of electronics and optical systems subjected to air, ship, or spacecraft vibration. Taylor Devices, Inc. primarily sells its products through sales representatives and distributors in the United States, Asia, North America, Europe, South America, and Australia. The company was founded in 1955 and is based in North Tonawanda, New York.
Top Companies To Watch For 2014: Exide Technologies(XIDE)
Exide Technologies engages in the production and sale of lead-acid batteries for transportation and industrial applications. It offers transportation batteries, which include ignition and lighting batteries for cars, trucks, off-road vehicles, agricultural and construction vehicles, motorcycles, recreational vehicles, marine, and other applications, such as micro-hybrids and lead-acid batteries used on full electrical vehicles. The company sells its batteries under the Centra, DETA, Exide, Exide Extreme, Exide NASCAR Select, Orbital, Fulmen, and Tudor brand names, as well as under various private labels. It also provides industrial energy products that consist of motive power batteries, which are used in material handling industry for electric forklift trucks, floor cleaning machinery, powered wheelchairs, railroad locomotives, mining, and the electric road vehicles markets. In addition, the company offers network power batteries, which are used for back-up power applicati ons in telecommunications systems, computer installations, hospitals, air traffic control, security systems, utility, railway, and military under the Absolyte and Sonnenschein brand names. Further, Exide Technologies offers battery chargers and related equipments for the operation and maintenance of battery-powered vehicles. It sells its transportation products through mass merchandisers, auto parts outlets, wholesale distributors, battery specialists, national account customers, retail stores, original equipment manufacturers (OEM) dealers, automotive parts and battery wholesalers, auto centers, service installers, and oil companies; and industrial energy products to OEM suppliers of lift trucks, industrial companies, retail distributors, warehousing companies, and manufacturers. The company operates in the United States, France, Germany, Italy, Spain, and Poland, as well as internationally. Exide Technologies was founded in 1888 and is headquartered in Milton, Georgia.
Top Companies To Watch For 2014: Oracle Corporation(ORCL)
Oracle Corporation, an enterprise software company, develops, manufactures, markets, distributes, and services database and middleware software, applications software, and hardware systems worldwide. It licenses of database and middleware software, including database management software, application server software, service-oriented architecture and business process management software, data integration software, business intelligence software, identity and access management software, content management software, portals and user interaction software, development tools, and Java; and applications software comprising enterprise resource planning, customer relationship management, enterprise performance management, supply chain management, business intelligence applications, enterprise portfolio project management, Web commerce, and industry-specific applications software. The company also offers customers with rights to unspecified software product upgrades and maintenance releases; Internet access to technical content; and Internet and telephone access to technical support personnel. In addition, its hardware systems products consist of computer server and hardware-related software, including the Oracle Solaris Operating System; and storage products, such as tape, disk and networking solutions for open systems and mainframe server environments. Its hardware systems support solutions include software updates for the software components. Further, the company offers consulting solutions in business and IT strategy alignment, enterprise architecture planning and design, initial product implementation and integration, and ongoing product enhancements and upgrades; cloud services, including Oracle Cloud Services and Advanced Customer Services; and education solutions comprising instructor-led, media-based, and Internet-based training in the use of its software and hardware products. The company was founded in 1977 and is headquartered in Redwood Ci ty, California.
Advisors' Opinion:- [By Mani]
The team of Larry Ellison, the founder and Chief Executive of Oracle Corporation (NASDAQ:ORCL), may have won the thirty-fourth America's Cup. However, it could be difficult for Ellison's corporate team to escape the discontent from shareholders, who are against higher pay packages for Oracle executives amid mixed results.
Top Companies To Watch For 2014: P.A.M. Transportation Services Inc.(PTSI)
P.A.M. Transportation Services, Inc., through its subsidiaries, operates as a truckload transportation and logistics company in the United States, Canada, and Mexico. The company engages in transporting general commodities. Its freight consists primarily of automotive parts, expedited goods, and consumer goods, including general retail store merchandise, as well as manufactured goods, such as heating and air conditioning units. The company also provides brokerage and logistics services, which include transportation scheduling, routing, mode selection, transloading, and other value added services related to the transportation of freight. As of December 31, 2010, it operated a fleet of 1,768 trucks and 4,632 trailers. The company was founded in 1979 and is headquartered in Tontitown, Arkansas.
Top Companies To Watch For 2014: PIMCO New York Municipal Income Fund(PNF)
PIMCO New York Municipal Income Fund is a mutual fund launched and managed by Allianz Global Investors Fund Management LLC. The fund is co-managed by Pacific Investment Management Company LLC. It operates as a nondiversified, closed-end management investment company. The fund invests primarily in municipal securities. The fund?s investment portfolio includes investments in hospital, water and sewer, tobacco, state and local general obligations, education, lease, tax, and power sectors. PIMCO New York Municipal Income Fund was formed in 2001 and is domiciled in United States.
Top Companies To Watch For 2014: Akela Pharma Inc He Company] (AKL.TO)
Akela Pharma, Inc. operates as a specialty contract pharmaceutical formulation developer in the United States. It offers contract pharma services comprising formulation and process development of drug in tablets, capsules, multiparticulates, fast formulations, oral and topical liquids, powders for suspension/reconstitution, and semi-solid forms. The company also provides analytical services, which include research and development analytical testing and support for formulation development; analytical method development and phase-appropriate validation; quality control testing for API and raw materials release; and stability testing and ICH compliant stability storage. In addition, it offers drug delivery solutions, such as hot melt extrusion for amorphous dispersions, spray-drying for amorphous dispersions, controlled release dosage forms, liquid solutions (encapsulated and bottled), and novel dosage forms, as well as beads, granulation, and drug layering services. Further, the company�s contract services consist of handling of potent compounds; pharmaceutical patent litigation support services; GMP clinical and commercial manufacturing; clinical labeling and packaging; and IP validation and contestation consulting services. The company was formerly known as LAB International Inc. and changed its name to Akela Pharma, Inc. in June 2007. Akela Pharma, Inc. was founded in 1979 and is headquartered in Austin, Texas.
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