Why Amazon Needs the Fire Phone

Unveiled today in Seattle, the Amazon.com Inc. (Nasdaq: AMZN) Fire Phone is everything the rumors promised and more, but there was one surprise - the price.

Instead of offering the Amazon Fire Phone at a nominal $99, or even giving it away with an Amazon Prime subscription, the online retail giant is charging $199 for its 32-gigabyte model and $299 for its 64-GB model.

And those are the subsidized prices, available only with a two-year contract with AT&T (NYSE: T), the exclusive carrier of the Amazon Fire Phone. AMZN is also selling the Fire Phone at unsubsidized prices: $649 and $749.

That's getting into Apple Inc. (Nasdaq: AAPL) iPhone territory, although those prices are $100 less than the comparable models of the top-of-the-line iPhone 5S. Samsung Electronics' (OTCMKTS: SSNLF) flagship, the new Galaxy S5, is about the same price as the Fire.

So Amazon Chief Executive Officer Jeff Bezos is betting that the Fire Phone will be able to capture a slice of the high-end smartphone market by competing on features, not price, as everyone expected.

He might be right - the Amazon Fire Phone has a clever 3D display that lets users view objects from different angles by tracking the user's eye movements.

The Fire Phone also has a feature called Firefly, which uses the phone's 13-megapixel camera to recognize books, phone numbers, bar codes, website addresses, QR codes, and more. It uses the phone's microphone to recognize songs.

And of course, anything the Amazon Fire Phone recognizes that also happens to be for sale on Amazon.com can be purchased with just a touch of a button.

AMZN has also thrown in the clever Mayday feature, which is also available on the Kindle Fire tablet. Mayday is 24/7 tech support with a twist - a customer support person appears on the screen and talks you through your problem live, even taking control of the device remotely if needed.

But the question is, will all that be enough to lure people away from the Galaxy S5, with its larger, crisper display, or the iPhone 5S, with its fingerprint recognition and soon-to-arrive apps for monitoring health and controlling the home?

Amazon faces a tough fight to be sure, but it didn't have much choice...

Why Amazon (Nasdaq: AMZN) Needs the Fire Phone

The stakes are very high for Amazon. Smartphones are increasingly becoming central to people's lives, and that includes shopping.

New technology like Apple's iBeacon allows stores to beam ads to people's phones - both iPhones and those that use Google Inc.'s (Nasdaq: GOOG, GOOGL) Android - based on which aisle they're standing in.

If more people start acting on ads like that, they'll be buying fewer things from Amazon.

So in one sense, the Amazon Fire Phone is a defensive move. The Firefly feature in particular is clever and useful, but it also directs people to Amazon to make a purchase.

You can't blame AMZN for not wanting to leave one of the primary tools of e-commerce - the smartphone - entirely in the hands of rivals like Apple and Google.

That also could partly explain the premium pricing. The customers most likely to shop on their smartphones are also the ones with the most money - the ones that buy top-of-the-line models like the iPhone.

That's the customer Amazon wants to compete for.

And while this strategy is riskier than what it did with the Kindle Fire tablet - pricing it below most competitors to gain market share - it offers a bigger payoff if successful.

SunTrust analyst Robert Peck ran a model of how much revenue the Amazon Fire Phone could generate based on market share estimates of 5%, 10%, and 15%. He included not just revenue from sales of the phone, but also additional sales of Amazon.com merchandise and Amazon Prime memberships.

Though Peck may not have anticipated the high selling price or that AMZN is including one year free of Prime service, his numbers show that the Fire Phone could have a significant impact on Amazon's top line.

If the Amazon Fire Phone can take 5% of the market, Peck sees additional revenue of $1.1 billion. For a market share of 10%, he projects just under $2.25 billion, and for a market share of 15% he sees additional revenue of $3.37 billion.

Of course, we don't know the cost to Amazon for not doing the Fire Phone, which could be quite damaging over time.

Amazon has done everything it can to create a product that will prevent sales from migrating to competitors while encouraging more sales on its own site. The payoff, if it works, will be huge.

For the moment, Wall Street is optimistic. AMZN stock was up 2.69% to $334.38 Wednesday following the announcement.

But going after Apple and Samsung head on won't be easy.

Are you planning to buy the Amazon Fire Phone? Do you think it has a chance of stealing sales from the iPhone and Galaxy S5? Share your opinions on Twitter @moneymorning or Facebook.

Editor's Note: While investors have been fond of AMZN stock, it does not yet pay a dividend. But in recent years not only have more tech giants started to pay dividends, they're delivering high yields as well. Here's what's behind this trend - and five stocks to get you started...

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Benzinga: Breakdown of Amazon Phone Opportunity by SunTrust

Buffett Invites Berkshire Bear Back to Annual Shareholder Meeting

NEW YORK (TheStreet) -- Berkshire Hathaway  (BRK.A) will again play host to a short seller at its annual shareholder meeting in Omaha, Neb., on May 3, 2014. Warren Buffett introduced a "Berkshire Bear" to the shareholder meeting last year and invited TheStreet contributor Doug Kass of Seabreeze Partners to play the role.We "will again have a credentialed bear on Berkshire," Buffett said in his shareholder letter, released on Saturday morning. "We would like to hear from applicants who are short Berkshire (please include evidence of your position)."Berkshire shares have under-performed the S&P 500 index in the past 12-months, amid a sharp rise in stock markets in 2013. Over the past 12 months, Berkshire shares have risen more than 14%, while the S&P 500 has risen in excess of 22%.On Saturday, Berkshire reported better-than-forecast operating earnings as the Warren Buffett-run conglomerate continues to see its earnings rise amid a slow but steady recovery of the U.S economy.Berkshire Hathaway reported operating earnings of $3.7 billion for the fourth quarter of 2013, a 34% increase from year-ago levels. When counting investment and derivative gains of $1.2 billion for the fourth quarter, Berkshire Hathaway reported net income of just under $5 billion for the fourth quarter, a new record.Analysts forecast that Berkshire would earn $46.3 billion in revenue and operating income of $3.5 billion, according to Bloomberg data. While Berkshire's revenue was projected to rise, analysts forecast profits at the conglomerate would drop.Book value per Class A share rose to $134,973 for the full year, an 18% increase from the company's book value per share of $114,214 at the end of 2012. Berkshire's gain in net worth during 2013 was $34.2 billion, according to the company.Those gains allowed Berkshire Hathaway to outperform the S&P 500 Index over the five years between 2007 and 2013. In Berkshire's 2012 letter to shareholders, Buffett cautioned investors that! the firm might underperform the S&P 500 over a five-year stretch ending in 2013, potentially forcing the company to re-think its strategy.Kass, last year's credentialed Berkshire bear, said in a recent article that "Buffett's moats are breached" as some of Berkshire's big four stock positions, like IBM (IBM) and Coca-Cola (KO) have struggled to grow their revenue.Buffett, in his shareholder letter, said that Berkshire Hathaway had increased its investment in the firm's big four investments: Wells Fargo (WFC), American Express (AXP), IBM and Coca-Cola.

"We purchased additional shares of Wells Fargo (increasing our ownership to 9.2% versus 8.7% at yearend 2012) and IBM (6.3% versus 6.0%). Meanwhile, stock repurchases at Coca-Cola and American Express raised our percentage ownership," Berkshire said."For the four companies in aggregate, each increase of one-tenth of a percent in our share of their equity raises Berkshire's share of their annual earnings by $50 million," the company added. At the 2013 investor meeting Kass questioned whether Berkshire had grown too big to outperform markets. He also asked Buffett if Berkshire should begin selling or spinning off businesses in its sprawling financial empire. Berkshire's businesses span insurance, energy, railroads, aviation and a large investment portfolio.Kass:  11 Reasons to Short Berkshire-- Written by Antoine Gara in New York

Stock quotes in this article: BRK.A, BRK.B 

Top Restaurant Companies To Watch For 2015

Top Restaurant Companies To Watch For 2015: Chanticleer Holdings Inc (HOTR)

Chanticleer Holdings, Inc., incorporated in 1999, is a business operator focused on expanding the Hooters casual dining restaurant brand in international markets. Chanticleer has rights to develop and operate Hooters restaurants in South Africa and has joint ventured with the current franchisee in Australia. The company also has franchise rights to develop Hungary and parts of Brazil while evaluating several additional opportunities internationally. During the year ended December 31, 2011, Chanticleer and a group of private equity investors acquired Hooters of America, Inc. (HOA). HOA is the franchisor and operator of over 450 Hooters restaurants in 44 states and 28 foreign countries. In October 2013, Chanticleer Holdings Inc purchased American Roadside Burgers, Inc. In December 12, 2013, Chanticleer Holdings Inc acquired a 51% interest in JF Restaurants LLC, an owner and operator of restaurants. In February 2014, it acquired Hooters' United States Pacific Northwest franch ise rights and two existing restaurants in Oregon and Washington.

The Company operates in two business segments: Hooters franchise restaurants, and investment management and consulting services businesses. Hooters has also branched out to other areas, including licensing its name to a golf tour and the sale of packaged food in supermarkets. Its subsidiaries include Chanticleer Advisors, LLC, (Advisors), Avenel Ventures, LLC (Ventures), Avenel Financial Services, LLC (AFS), Chanticleer Holdings Limited (CHL), Chanticleer Holdings Australia Pty, Ltd. (CHA), Chanticleer Investment Partners, LLC (CIP), DineOut SA Ltd. (DineOut), Kiarabrite (Pty) Ltd (KPL), Dimaflo (Pty) Ltd (DFLO), Tundraspex (Pty) Ltd (TPL), Civisign (Pty) Ltd (CPL), Dimalogix (Pty) Ltd (DLOG) and Crown Restaurants Kft. (CRK).

South Africa

As of December 31, 2011, the Company had four Hooters locations in South Africa in Cape Town, Durban and Jo! hannesburg (two locations), which are owned by four companies, which it control. The Com! pany formed a management company to operate the current South African Hooters locations. It owns 80% of the management company, with two members of local management owning the remaining 20%. The management company charges a management fee of 5% of net revenues to the Hooters locations in South Africa.

Other Countries

The Company has acquired development rights for Hooters in five states of Brazil, which would include Rio de Janeiro. It has applied to HOA for franchise rights in Hungary, where it own 80% of the entity the Company anticipate will hold the franchise rights and its local partner owns the remaining 20%. The Company has partnered with the Hooters franchisee in a joint venture in which it owns 49% and its partner 51%. The first Hooters restaurant under this joint venture (which would be the third Hooters restaurant open in Australia) opened in January 2012 in Campbelltown, a suburb of Sydney. It has a non-binding letter of intent with a fr anchisee to purchase 100% of an existing Hooters location.

Management and consulting services

The Company provides management and consulting services for small companies, which are seeking to become publicly traded. The Company also provides management and investment services for Investors LLC and Investors II, which are affiliates of the Company.

Advisors' Opinion:

• [By Chris Isidore]

  Restaurant chains are trying to hold the line on prices. Mark Allison, senior vice president of culinary operations at Chanticleer Holdings (HOTR), which operates the American Roadside Burger chain, said his chain raised prices about 12%, even though their beef costs are up even more than that.

source from Top Penny Stocks For 2015:http://www.topstocksforum.com/top-restaurant-companies-to-watch-for-2015-2.html

Lululemon Athletica: What’s With All the Positivity?

It’s been a painful 12 months for shares of Lululemon Athletica (LULU)–but is the stock working out the kinks? It could be, as another pair of analysts sent good vibes its way.

For starters, Oppenheimer upgraded Lululemon’s shares to Outperform from Perform, citing the possibility of a pickup in sales growth in the quarters ahead. Then along came William Blair’s Sharon Zackfia and team, who see  sales accelerating in the months ahead. They explain:

While we believe much of 2013 for lululemon can be best characterized as self-inflicted pain (sheer luon, unexpected CEO resignation, ill-worded televised chairman comments), it is worth noting that lululemon is still likely to easily outperform the vast majority of retail in 2013, with an approximate 4% brick-and-mortar comp gain and an approximate 10% comp gain including e-commerce. With some encouraging early data points on customer reception of spring product, we see the potential for comps to begin improving as early as the first quarter and view the stock as a compelling risk/reward opportunity from current levels of 22 times our 2014 estimate.

Still, Lululemon Athletica faces a big challenge from the Gap’s (GPS) Athleta brand. Belus Capital’s Brioan Sozzi explains:

One way to win an already bloody war?  Find a new tactic that will surprise the entity being fought with such crazy effort.  In many respects, that's precisely what Gap's more rugged activewear brand Athleta has begun to execute on in its heated battle with the calmer, yoga centric Lululemon.  How so?  By offering very unique in-store workout classes each day, week after week.  Whereas Lululemon, according to its website "every week, Lululemon stores and showrooms push aside their products, unroll yoga mats, and turn their space into instant yoga studios", Athleta's scheduled class differentiation keeps its stores exciting.  Most importantly, it brings in consistent traffic of folks with likely different personal preferences, meaning the company has the opportunity to show that its products are more versatile compared to Lululemon.  More versatility, more value in the mind of the consumer.

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Nomura's Robert Drbul initiated Lululemon as a Buy on Feb. 13, while RBC upgraded the company on Feb. 7 and Citigroup upgraded Lululemon on Feb. 6.

Shares of Lululemon have gained 0.8% to $51.47 at 3:31 p.m., while the Gap is little changed at $42.33. Nike (NKE) has risen 0.3% to $75.32, while Under Armour (UA) has jumped 1.4% to $107.51. Maybe it wasn’t the uniforms after all.

Can CBS Make You Watch Thursday Night Football?

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A news break is out from multiple sources, showing that CBS Corp. (NYSE: CBS) will produce a full slate of 16 NFL games. The problem is that this is the Thursday Night Football package.

Football is big business in America. The problem is that Thursday Night Football has been considered dead by comparison to Sunday for quite some time – even with higher ratings last year. TVbytheNumbers showed that ABC, NBC, FOX, CBS and Turner were all bidding for Thursday Night Football. The report says,

“CBS will air eight early season games that also will be simulcast on NFL Network. NFL Network will also televise eight late-season games in the run-up to the playoffs. The mix of games will include 14 on Thursday nights and two late-season games on Saturday.”

The good news is that Thursday Night Football ratings were up in 2013. The bad news is that is still not even half of the Sunday lineup games. Yahoo! Sports showed the figures around the initial bidding as follows:

NFL Network’s Thursday night games were viewed by an average of 8 million viewers for a 13-game schedule in 2013, a 10 percent boost from 2012 but still far below NBC’s average 21.5 million viewers for its Sunday night contests.

CBS shares have already backed off marginally from their highs after the news. The stock is up 0.3% at $58.05, versus a daily range of $56.75 to $58.57 and a 52-week range of $41.33 to $64.06.

What CBS investors need to consider is that the company’s stock market value is already worth almost $35 billion. It simply may not be enough to move the needle here, particularly if ratings and/or advertising dip again. Now CBS just needs to figure out how to keep the guys from going out to that happy hour on Thursday after work looking for other things besides a football game on television.

Advised investors underperformed self-directed ones in 2013, SigFig data show

Investors opening their year-end account statements are likely to be reassured that the financial crisis is in the rearview mirror.

But clients of financial advisers may not be as pleased to learn that their portfolios underperformed those of self-directed investors.

Investors who paid fees for portfolio management saw portfolio returns of 14.1% last year, according to SigFig, a website that helps investors track and manage their money.

But investors who didn't pay those fees captured a 17.1% return over the year, said Samantha Murillo, a spokeswoman for the firm, which tracks about 1 million investors' portfolios.

Investment portfolios were lifted by strong domestic stock market appreciation last year, with the S&P 500 rising 29.6% during the year. But bond prices fell dramatically as the Federal Reserve considered reducing the billions in monthly asset purchases it uses to depress interest rates and stimulate economic growth.

The relative underperformance of advised portfolios was likely due to asset allocation strategies that exposed investors to suffering bonds, said Lee DeLorenzo, an adviser and president of United Asset Strategies Inc.

“Those numbers don't surprise me,” she said. “I don't think the exposure to bonds was a mistake. I think it caught most of us by surprise.”

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Grant Rawdin, president and CEO of Wescott Financial Advisory Group, said the investors in 2013 might have been rewarded for not being well-diversified.

“As advisers, we try to pull our clients away from one area of the market,” he said. “We know the real value is in all of the planning we do for the client, the security we give our client.”

Another value of advisers is in managing their clients' behavior, Ms. DeLorenzo said.

“Financial advisers, just because of the market psychology, can keep people calm from making those traditional mistakes: buy high, sell low, stick with a loser and wait for it to come back,” she said.

“That is worth the 1%,” Ms. DeLorenzo said, referring to the price that many advisers charge for their services each year.

The cost of financial advice for the subset of some 35,000 investors who paid management fees amounted to an average expense ratio of 70 basis points last year, excluding asset management fe! es, according to SigFig.

Average expense ratios ranged from 90 basis points for clients with less than $250,000 in holdings to 40 basis points for those with more than $2 million invested. (One basis point is equal to 0.01%.)

The data set may not mirror the overall performance of investors.

For instance, SigFig users appear to be more aggressive than the average investor, putting more than six in 10 of their investible dollars in stocks. Advised clients had slightly less exposure to stocks.

But American investors overall keep 48% of their investible assets in cash, 18% in equities and 7% in bonds, according to a survey last year by asset manager BlackRock Inc.

The SigFig data came from examination of the portfolios of investors who track their portfolio performance on the SigFig site. The website is run by registered investment adviser SigFig Wealth Management, that launched its own fee-based portfolio management service last month.

The firm's founder and chief executive, Michael Sha, has said that conflicts of interest and hidden fees are common in the advisory industry.

Some advisers say that low-cost, online financial advice services provide only basic services and that their business plans aren't feasible. Like what you've read?