One great way to make money in equities is to find a growth company in a growth business, but do so before the company actually grows so the stock is dirt cheap. As for the business, it makes no sense to invest in a new and better sewing machine manufacturer, for instance, as sewing is not a growth industry. One industry that fits the bill for a true growth industry is mixed martial arts. As established sports leagues and events as popular as the National Football League and NASCAR have experienced actual drops in attendance these past few years, mixed martial arts bills itself, quite correctly, as the fastest growing sport in the world. That makes the arena of providing product and services to the mixed martial arts industry an attractive proposition to any company.

One company that is in a position to take advantage of both the growth of mixed martial arts and the fact that its primary target audience is persons under 35 years of age is Respect Your Universe (RYUN). It is a young company, with limited sales to date and no profits. It describes itself on its website as “a premium training apparel and equipment company rooted in and inspired by mixed martial arts.” Yet, when looking at any sort of developmental company, one must first look at the managers. When it comes to Respect Your Universe, I like what I see. Its Chief Executive Officer and Director, Christoper Martens, is formerly an executive at Nike (NKE), specifically serving as its General Manager and Merchandise Director. He served also as Global Director of Apparel for the Beijing Olympic Games in 2008. Prior to Nike, he served eleven years in the apparel division at Eastern Mountain Sports.

John Wood is President of Respect Your Universe, and also a board member. Prior to coming to his current position, he was Director of Customer Development at two major Las Vegas nightclubs, putting him in contact with many of the promoters and participants in Ultimate Fighting Championship events. He is also a martial arts expert on his own accord. His contacts make him the “point” man for Respect Your Universe’s efforts to become the “inside” apparel maker for the mixed martial arts community.

Steven Eklund is the Chief Financial Officer. He has decades of experience in finance with large consumer operations like Nike, General Mills (GIS), and Eddie Bauer. He is 64 years old, substantially older than the other officers, and will add a nice bit of seasoning to the management team.

The other director, Erick Siffert, is Chief Operations Manager. He too has decades of experience in operations, much of that for Nike. All told, this is an idea combination of experience, contacts, and energy for any developing company to be lucky to have. This team gives me great confidence that Respect Your Universe will have every chance to succeed.

Respect Your Universe purports to base its products on foundation beliefs in respect, strength, honor and sustainability. Its products all have special markings, taken from ancient Swahili iconography to designate it is a moisture wicking fabric “Air Weave”, a weather resistant fabric “Wind Weave”, thermal control fabric (Fire Weave), and environmentally friendly fabric (“Terra Weave”).

Respect Your Universe sells a wide variety of performance athletic and leisure wear for indoor and outdoor, competition and training. All its products either incorporate recycled materials, or organic fabrics. Offerings are for men and women, everything from performance shorts to hoodies and duffel bags. The bulk of its sales have been through its web site, but inroads have been made with national retailers also such as Von Maur department stores and Eastbay. Earlier this month, Respect Your Universe reached an agreement to open its first, and flagship, retail store in Las Vegas. It will be placed in an upscale mall, across from a Burberry (BURBY) store.

I do not know of any company as uncompromising to quality and environmentalism as Respect Your Universe purports to be. Its biggest downside is it has no real track record. It has a market capitalization of a little less than $40 million, and trailing 12 month revenue of $67,000 through March 31, 2012. At that time it held a little more than $2 million cash on hand, $0.5 million in inventory, $0.8 million in deposits, and $1.7 million in prepaid expenses. The company recorded a loss in the second quarter of the year of $1.94 million, and since the inception of the company in 2008 has recorded a cumulative loss of a little over $10 million. It carries virtually no long term debt.

This company bears all the hallmarks of a young company in its development stage. It will begin to receive real revenue in the current quarter through its new retail marketing partners and its web site, which only because operational in February of this year.

Perhaps the “grown up” company that most resembles what Respect Your Universe might someday be is Lululemon Athletica (LULU). This high cap ($8.8 billion market capitalization) company has achieved terrific growth without taking on long-term debt. Its operating margin of 28% is more than double Nike’s and Under Armour’s (UA). Its return on equity of 35% is outstanding in any sort of business. And best of all, it is selling at a lower 5 year PEG than Nike, Under Armour or Adidas (ADDYY). Lululemon has obtained this enviable record and position by securing a market, in its case the yoga market, and from that position it is chewing on the virtual heels of Nike and Under Armour in running and other athletic apparel. That, in my opinion, is the way for Respect Your Universe to sustain years of growth. Secure the mixed martial arts market, and then slowly make inroads in other athletic or fashion areas. Time will tell.

Transparency/Disclosure: I am not a registered investment advisor and do not provide specific investment advice. The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research. I am a consultant to a third-party and have received one hundred fifty dollars for independent research. Always discuss investments with a licensed professional advisor before making any financial decisions. Statements made herein are often “forward-looking statements” as stipulated under Section 27A of the Securities Act of 1933, Section 21E of the Securities Act of 1934, and the Private Securities Litigation Reform Act of 1995. While I have researched this company thoroughly, my due diligence is not a substitute for your own.

EMC (EMC) and Verizon (VZ) have just announceda new cloud computing partnership that will involve EMC, the giant data storage company and Verizon’s managed IT infrastructure subsidiary, Terremark. Terremark will provide standard offerings in its private cloud business on EMC infrastructure for public and hybrid cloud deployments by its customers. In addition, the two companies are expected to work together on the development of new cloud-based services and products that use EMC storage, backup and replication. Verizon paid $1.4 billion last year for Terremark as an entry into the potentially lucrative infrastructure and cloud services business. The companies have been working together for almost 10 years now.

Earlier, EMC reported strong results for the first quarter and this is the ninth consecutive quarter in which the company has achieved growth in double digits for revenue, EPS and net income. Revenue for the first quarter was $5.1 billion, an increase of 11% on a year on year basis and net income rose by 23% to $587 million. First-quarter EPS was $.37 a share an increase of 29% over the figure of $.27 a share in the same quarter of the previous year. Operating cash flow was $1.7 billion and free cash flow amounted to $1.4 billion. The company ended the quarter with $10.7 billion in cash and equivalents. The revenues were divided roughly equally between the United States and the rest of the world. The company reported strong customer demand for its leading mid-tier storage products portfolio3 while the Isilon scale-out NAS business nearly doubled its revenue .To continue reading, click here.

The number of homes refinanced under the new and improved Home Affordable Refinance Program (HARP) nearly doubled in the first quarter of 2012. That should benefit mortgage REITS that invest in government guaranteed mortgages, such as AG Mortgage Management (MITT), Hatteras Financial (HTS), American Capital Agency (AGNC), and Annaly Capital Management (NLY).

Stocks from mREITs like these should see a small boost in profits from this news. Even though the volume of refinances under HARP 2.0 has nearly doubled, the number is still very low. Around 180,000 mortgages were refinanced under the program in the first quarter, compared with around 93,000 in the last quarter of 2011.

The number of refinances does seem to be refinancing dramatically – around 80,000 HARP refinances were completed in March. The reason for this increase appears to be new mortgage refinancing software written expressly for HARP. The New York Times reported that the Federal Housing Finance Agency (FHA) only made the program fully available at that time.

These numbers show that the refinancing business is getting a dramatic boost, which should increase the volume of business at mREITs. This should also increase their cash flow and profits. Also increased will be the amounts that those companies can leverage.

The major factor holding the number of HARP refinances down is the requirement that homeowners be current on their mortgage payments. Many underwater homeowners have had a hard time meeting mortgage payments because of the dismal economy.To continue reading, click here.

U.S Bancorp (USB) is one of the best stocks in the banking industry for any investor to add to his or her portfolio. This is the most reliable and defensive stock that provides stability and favorable returns with adequate dividends set to increase over time. U.S Bancorp has one of the most conservative approaches to risk management and diversified portfolios in order to ensure growth and equitable returns for the long term. The future is looking positive on all fronts for U.S. Bancorp and its performance has been impressive for the past five years through the financial crisis. U.S Bancorp is not susceptible to many of the obstacles and inadequacies that have plagued competitors like Bank of America (BAC) and JPMorgan (JPM). U.S Bancorp is now poised to outperform its competitors and increase its stock price beyond its all-time high of under $40 per share.

The current stock price for U.S Bancorp is above $31 per share. This is toward the maximum of its 52-week range from $20.10 to $32.98. The current stock price is slightly below the 50-day moving average of $31.40 and above the 200-day moving average of $29.09. The beta is around one and the PEG ratio is slightly above one as well. The enterprise value is above $100 billion, which is almost $50 billion above its current market cap. This all suggests that USB’s stock price is about to increase beyond its recent trend at a respectable rate with potential to grow significantly beyond its previous high mark.To continue reading, click here.

Things just keep taking a wrong turn for the investment banking industry. After announcing a $2 billion loss due to a derivatives bet gone awry, JP Morgan (JPM) is now facing an FBI investigation on whether its officers engaged in any criminal activity related to the loss.

Meanwhile, JP Morgan’s rival, Morgan Stanley (MS), is facing an investigation from both the SEC and FINRA, and also the U.S. Senate, regarding whether it selectively disclosed information to its clients in the lead-up to Facebook’s (FB) Initial Public Offering.

That news came even as reports emerged that Morgan Stanley’s co-underwriters, JP Morgan and Goldman Sachs (GS) had actually been helping clients, such as hedge funds, sell Facebook shares short amidst the stock’s precipitous decline not long after listing. Where it gets worrisome for investors in financial stocks is that these occurrences inevitably provide ammunition for those seeking to reform Wall Street, whether its because of fears about “Too Big To Fail” or the “Fight for the Little Guy.”

That’s all well and good – but the fact of the matter is that companies like JP Morgan thrive on the $1.2 quadrillion derivatives market and, during lean times for trading financial assets, rely on fees from investment banking activities such as underwriting and advisory areas, not coincidentally, that are coming under ever-greater scrutiny.

Indeed, investment banking (25%) accounts for a fourth of JP Morgan’s revenues. During boom periods of significant financial innovation and high stock market returns, investment banking can easily double its overall contribution to revenues.To continue reading, click here.

Pfizer (PFE) is in a period of transition right now in an effort to reposition itself as the leader in the pharmaceutical manufacturing industry. Its balance sheet and value in the market is less than stellar so it is an ideal time for investors to consider Pfizer for long-term investment opportunities. Pfizer is divesting its non-essential models in order to refocus on its core functions regarding high margin pharmaceutical manufacturing.

The transition period is needed due to Lipitor’s decline in sales numbers after the patents expired in 2011. Pfizer has a large pipeline of opportunities and positive cash flow available to buy back shares or focus on effective acquisitions to help increase its success in gaining more market share in the industry.

This is the optimal time to buy shares in Pfizer as the stock price has been trending upwards recently. With the transition underway, if it’s successful, this may be the lowest stock price available for investors interested in Pfizer. The price has currently been around $22, the 52 week range has been from $16 to $23. This is the lowest price available among the major pharmaceutical brands like Merck (MRK), Johnson & Johnson (JNJ), Bristol-Meyers Squibb (BMY), and Abbott (ABT).

The 50 day and 200 day moving average are right around the current stock price at over $22 and over $21, respectively. The beta is less than one while net and operating margin are adequate at over 14% and over 29%, respectively, even though they have decreased since 2011.To continue reading, click here.

Chevron (CVX) is a favorable investment that is adequately priced in the market and shows potential of growth through its promising ventures and operations. Chevron is the 5th largest integrated energy company in the world with an assertive plan to become the leading organization in the LNG market worldwide. It also pays out adequate dividends to shareholders and it currently slightly undervalued for its potential in the market. This is best served as a long-term defensive investment.

The current stock price is hovering around $100 per share while the 52 week range has been from $86 to $112. The 50 day moving average and 200 day moving average have been around $103 and $105 respectively. The beta typically ranges from .7 to one as a relatively stable investment on the market. The return on equity has been decreasing slightly the past three quarters but it is still above the industry average. Its net and operating margins have been increasing the past three quarters and are above the industry average.

Both the quick and current ratio is above one and institutional ownership is above 60 percent; these two factors underscore the value of the investment in Chevron. The price is about seven times earnings, which is only slightly higher than the industry average. The important factors indicating the growth and value of Chevron are its current operations on the horizon.

There are at least three major ventures that separate Chevron from its competitors, like BP (BP), Exxon (XOM), ConocoPhillips (COP) and Shell (RDS.A).To continue reading, click here.

Netflix (NFLX) provides and sells subscription services for TV shows and movies, offering customers the choice of receiving DVDs by mail, or streaming its available content through various smart devices in the home. Formerly a popular, high-flying growth stock, peaking near $300 per share in July of 2011, the company and the stock have fallen on hard times, and it currently trades around $73 per share. As with all technology stocks, the questions for Netflix are trifold. First, how does it compare to peers? Second, when will its current way of doing business be replaced by the next best thing? Third, how will the company adapt to the changing landscape? Let’s attempt to answer each of these questions, in turn.

Competition, a quick recap

The only direct, apples-to-apples, competition to Netflix is the former video store giant, Blockbuster, now owned by DISH Network (DISH). Both DISH Network and Netflix offer not only streaming entertainment content, but also DVDs through the mail. The Blockbuster division of DISH Network offers the extra component of personally exchanging DVDs in the dwindling number of Blockbuster branded storefronts, but I don’t expect that to be a lasting part of its business model due to unsustainably high overhead.

Coinstar (CSTR), the owner of the unmistakable self-serve DVD kiosks branded as Redbox, is a fringe competitor. Not offering streaming content, users of Redbox rent and return DVDs via roadside kiosks for $1 per day.To continue reading, click here.

Integrating television, video and music streaming, and web browsing has revolutionized how people receive and view their favorite TV shows, movies, music, video clips, photos, and more. And as people become more used to the convenience of accessing both television and the Internet on one device, the more they will demand it in the future. As a result, telecom companies like Windstream (WIN), Verizon (VZ), Comcast (CMCSA), AT&T (T), and Charter Communications (CHTR)have all had to adapt to meet customers’ changing needs.

Windstream’s Merge

In this article, I argue that Windstream’s new Merge service is a killer deal for frugal investors like me! In March 2012, Windstream introduced Merge, a high-speed Internet entertainment service that provides high speed Internet with access to free and paid Internet content. Customers can access paid movie and television streaming services like Netflix, Huluplus, and free services like music streaming from Pandora with a click of a button instead of having to visit the websites to sign in. This also allows people to view or listen to media from their television instead of crowding around a small computer or smartphone screen.

With Merge, customers can download movies, television shows, and other content found online directly to their television or computer. The company has also started producing its own web-only series, ‘On the Mark,’ which customers can download from both Facebook (FB) and Youtube. The show, an introspective look at pop culture and television, hosted by journalist Mark Steines, will air every other week for the next six months. To continue reading, click here.

Pfizer (PFE) is the world’s largest research based pharmaceutical company by sales. In addition to its core human healthcare business, it has leading positions in animal health care and infant health, as well.

I was looking forward to its first quarter 2012 earnings as the company’s top selling drug, Lipitor, lost patent protection in the fourth quarter of 2011.

Pfizer’s issue with losing top selling drugs to patent expiration is hardly unique. Since late in the last decade, many top selling drugs have fallen to generic competition among all large drug makers. A curious thing is pharmaceutical patents. Copyrights for books or movies don’t expire. Patents for widgets last forever. But drug companies aren’t selling widgets or entertainment. They are peddling, and profiting mightily, by selling health care. Patent rights are provided for 20 years from the time the medication is first identified in the research phase. Never mind that it can take eight years or more for the FDA to approve a drug. There are mechanisms to extend the 20 years for a few more, and the industry is rife with litigation between generic makers and research drug manufacturers.

Due largely to an anticipated steep fall in Lipitor based revenues, Pfizer’s revenue in the first quarter of 2012 fell 7% to $15.4 billion. GAP profits were $1.79 billion, or $0.24 per share. The year ago GAP profit was about $2.2 billion, or $0.28 per share. Excluding special items, earnings in the 2012 first quarter were $0.58, per share, or two percent above analysts expectations for the quarter. All in all, a solid performance given the conditions. To continue reading, click here.

Although natural gas prices remain depressed in the U.S. due to unusually low demand, companies like BP that continue to focus resources on these plays will be in a better position to compete as liquid reserves are depleted. The net margin on dry gas from unconventional plays only grows as fracking becomes more sophisticated, and BP, with its experience and deep R&D budget, is prepared to exploit these opportunities. Given BP’s focus on exploration and production and divestiture of non-core assets in its latest annual report (pdf), it appears that BP’s leadership is well aware of the need to be dexterous in the coming years, and won’t be swayed by a temporary downswing in commodity prices.

Although in the U.S. dry gas prices decreased 8% in 2011 over 2010, in Europe prices increased an average of 33% for the same period. BP’s global reach helped offset losses and storage costs for a commodity that had very low demand stateside. Despite growing calls for stronger carbon policies in OECD countries, BP is predicting (pdf) that oil and gas consumption will fall only slightly in the coming decades, from 57% today to 53% in 2030.

BP believes (pdf) that natural gas will be the fastest growing fossil fuel over the next 15 years, and has plans to exploit this resource through agreements with the governments of Oman, Algeria, and Indonesia. Seeing that the future of profit does not lie in solar, BP is preparing (pdf) to exit solar and focus on exploration and production of carbon resources. To continue reading, click here.