Top 5 Services Companies To Invest In 2015

Lackluster economic growth in the U.S. has nothing to do with financial services regulatory overreach inherent in new Dodd-Frank rules - as some neo-conservatives would have the American public believe.

Let me say, I'm a staunch fiscal conservative. I am a dyed-in-the-wool free markets entrepreneur. But there's a world of difference between free markets and a free-for-all for financial services oligarchs and officers.

In a July 21, 2014 American Banker article commemorating the four-year anniversary of the signing into law of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Paul H. Kupiec, a resident scholar at the American Enterprise Institute (AEI), makes the misguided case that Dodd-Frank is what's holding back the recovery.

Here's a look at how a recession prevention backstop is coming under siege...

Understanding the (Flawed) American Banker Argument

Just because Mr. Kupiec has been a director of the Center for Financial Research at the Federal Deposit Insurance Corporation and chairman of the Research Task Force of the Basel Committee on Banking Supervision, before hanging his hat at the AEI, doesn't mean his position on behalf of the big-business-centric American Enterprise Institute is objective. It's not.

Top 5 Services Companies To Invest In 2015: United Continental Holdings Inc.(UAL)

United Continental Holdings, Inc., through its subsidiaries, engages in the provision of passenger and cargo air transportation services. As of February 24, 2011, it operated a total of approximately 5,675 flights a day to 372 airports on 6 continents from their hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles, New York, San Francisco, and Tokyo, as well as in Washington, D.C. The company was formerly known as UAL Corporation and changed its name to United Continental Holdings, Inc. on October 1, 2010. United Continental Holdings, Inc. was founded in 1934 and is headquartered in Chicago, Illinois.

Advisors' Opinion:

• [By Susan J. Aluise]

  But despite last year�� run-up in share prices, some airline stocks still boast attractive multiples and their overall business strategies look particularly promising this year, while some perennial performers look likely to hit a patch of turbulence in 2014. Here are two airline stocks that have further to fly and two that should buckle up for a bumpy ride:

  Book: United Continental Airlines (UAL)

  United Continental Airlines (UAL) CEO Jeff Smisek is willing to ruffle feathers to enhance United’s ability to compete — a fact vividly illustrated by the airline�� decision this week to drop its Cleveland hub, which has been a drain on earnings for the past decade.

• [By Dan Caplinger]

  Southwest has continued to follow a high-growth strategy, challenging Delta, American, and United Continental (NYSE: UAL  ) on their own turf. The company's decision to go up against United by expanding its Houston-based service is just one example of how Southwest hasn't hesitated to attack other airlines even in their hub cities. To facilitate that growth, though, Southwest has started to make some strategic decisions to pull out of weaker markets, especially small ones where profit opportunities haven't panned out the way the carrier had hoped.

Top 5 Services Companies To Invest In 2015: PetSmart Inc(PETM)

PetSmart, Inc., together with its subsidiaries, operates as a specialty retailer of products, services, and solutions for pets in the United States, Puerto Rico, and Canada. The company offers consumables, such as pet food, treats, and litter; and hardgoods, which include pet supplies and other goods comprising collars, leashes, health care supplies, grooming and beauty aids, toys, apparel, and pet beds and carriers, as well as aquariums and habitats, accessories, d�or, and filters for fish, birds, reptiles, and small pets. It also provides fresh-water fish, small birds, reptiles, and small pets; and pet services, such as grooming, including precision cuts, baths, nail trimming and grinding, and teeth brushing, as well as training, boarding, and day camp services. In addition, the company operates PetsHotels that offer boarding for dogs and cats; provides personalized pet care, an on-call veterinarian, temperature controlled rooms and suites, daily specialty treats and p lay time, and day camp services for dogs; and operates veterinary hospitals, which offer services comprising routine examinations and vaccinations, dental care, a pharmacy, and surgical procedures. As of January 29, 2012, it operated 1,232 retail stores; 192 PetsHotels; 791 veterinary hospitals under the trade name of Banfield, The Pet Hospital; and 8 hospitals operated through other third parties in Canada. The company also offers its products through an e-commerce and community site, PetSmart.com. PetSmart, Inc. was founded in 1986 and is based in Phoenix, Arizona.

Advisors' Opinion:

• [By Steven Russolillo]

  WATCH FOR:� No major economic data on dap. American Eagle, Booz Allen, Eaton Vance(EV), Hormel Foods(HRL), L Brands(LB), Lowe's(LOW), NetApp, PetSmart(PETM), Renren(RENN), Sina, Target, Tiffany, Trina Solar(TSL) and Williams-Sonoma(WSM) are among companies scheduled to report quarterly results.

• [By J. Royden Ward]

  PetSmart (PETM) carries a broad selection of high-quality pet supplies at everyday low prices. Stores offer 10,000 items, including nationally recognized brand names, as well as an extensive selection of private brands.

• [By Sue Chang and Saumya Vaishampayan]

  PETM: PetSmart Inc. (PETM) �shares dropped 1.5%. The company reported a decline in fourth-quarter profit to $131.5 million from $134.0 million a year earlier, while per-share earnings rose to $1.28 from $1.24. The company noted the fourth quarter of 2012 had an extra week that represented 17 cents in per-share earnings. Analysts polled by FactSet had expected earnings of $1.21 a share.

• [By Shauna O'Brien]

  Pet supply retailer PetSmart, Inc. (PETM) reported lower fourth quarter financial results on Wednesday, but beat earnings estimates.

  PETM’s Earnings in Brief

  PETM posted Q4 earnings of $131 million, or $1.28 per share, from $134 million, or $1.24 per share, a year ago. Revenue for the quarter was $1.8 billion, down 2.9% from last year. On average, analysts expected to see earnings of $1.21 per share and revenue of�$1.83 billion. For FY2013, earnings jumped 19% to�$4.02 per share from$3.38 per share in 2012. Net sales rose 4.3% to $6.9�billion. Looking forward, PETM expects to see FY2014 earnings between�$4.42 and $4.54 per share and sales growth in the range of 4%-6%. Analysts expect to see earnings of $4.45 per share.

  CEO Commentary

  David Lenhardt, CEO of PETM commented: ���e are pleased to report our results for fiscal year 2013, marking the fourth consecutive year of double-digit earnings per share growth.�I would like to thank our associates for their hard work and caring for our customers and communities.��/p>

  PETM’s Dividend

  PETM paid its last quarterly dividend of 19.5 cents on February 14. We expect the company to declare its next dividend sometime in March.

  Stock Performance�

  PetSmart shares were up $1.14, or 1.62%, during pre-market trading Wednesday. The stock is down 7% YTD.

Best Building Product Stocks To Invest In Right Now: KNOT Offshore Partners LP (KNOP)

KNOT Offshore Partners LP, incorporated on February 21, 2013, is a limited partnership formed to own, operate and acquire shuttle tankers under long-term charters. Its initial fleet of shuttle tankers contribute to the Company by Knutsen NYK Offshore Tankers AS (KNOT), which is jointly owned by TS Shipping Invest AS, (TSSI), and Nippon Yusen Kaisha (NYK). NYK is a Japanese public company with a fleet of approximately 800 vessels, including bulk carriers, containerships, tankers and specialized vessels. The Company is a holding entity and is conduct its operations and business through subsidiaries KNOT is an independent owner of crude oil shuttle tankers. Its general partner is KNOT Offshore Partners GP LLC. In August 2013, KNOT Offshore Partners LP's wholly owned subsidiary KNOT Shuttle Tankers AS completed its acquisition of all interests in Knutsen Shuttle Tanker 13 AS that owns and operates the Carmen Knutsen from KNOT Offshore Tankers AS.

The Company's initial fleet consists of four shuttle tankers, which are vessels designed to transport crude oil and condensates from offshore oil field installations to onshore terminals and refineries. The shuttle tankers include , Fortaleza Knutsen, Recife Knutsen, Bodil Knutsen and Windsor Knutsen. Its shuttle tankers are equipped with loading systems and dynamic positioning systems that allow the vessels to load cargo safely and reliably from oil field installations, even in harsh weather conditions.

Advisors' Opinion:

• [By Robert Rapier]

  KNOT Offshore Partners (NYSE: KNOP) is organized and headquartered outside the US. Although organized as a partnership, it has elected to be taxed as a corporation in the US and furnishes 1099s rather than K-1s.

• [By Aimee Duffy]

  April
  Kicking off the second quarter right, KNOT Offshore Partners (NYSE: KNOP  ) debuted on April 10. The partnership owns and operates shuttle tankers under customer contracts that last five years or more. Knutsen NYK Offshore Tankers (KNOT) controls the 2% general partner stake and all the incentive distribution rights. Shuttle tankers move crude oil and condensate from offshore oil rigs to onshore terminals and refineries, so it makes sense that KNOT Offshore's customers include BG Group, Statoil, and Transpetro.�

• [By Robert Rapier] There were a half a dozen initial public offerings (IPOs) by master limited partnerships in the first half of the year, and all but one are now in the green while one has nearly doubled in value.
  
  The first MLP IPO of 2013 debuted on Jan. 15. USA Compression Partners (NYSE: USAC), which I mentioned in last week’s issue, provides compression services for the oil and gas industry. Units have advanced 36 percent since the IPO, and at the current price yield 7.3 percent.
  
  The day after the USA Compression Partners IPO, CVR Refining (NYSE: CVRR) made its debut.  CVRR was spun off from CVR Energy (NYSE: CVI), and both companies remain majority-owned by Carl Icahn. CVR Refining’s primary assets are two refineries located in Kansas and Oklahoma with a combined processing capacity of approximately 185,000 barrels per day (bpd). These refineries are strategically located near the major Cushing, Oklahoma shipment and storage hub, with easy access to discounted feedstock from the nearby Permian basin, as well as the Bakken shale and Canadian oil sands.
  
  But refiners have struggled with diminished margins in 2013 because of a much lower Brent-WTI differential. After the recently concluded second quarter, CVRR declared a distribution of $1.35 per unit, bringing its per-unit distributions for the first half of the year to $2.93. At the same time, CVR Refining lowered its annual distribution target to a range of $4.10 to $4.80 per unit. This was lower than the outlook issued in March, when it foresaw annual distributions of $5.50 to $6.50. CVRR units slid on the news, and are presently trading slightly below the $25 IPO price. The lower end of the revised forecast implies distributions of $1.17 per unit in the second half of the year, for a forward annualized yield of 10 percent based on the recent $23.50 unit price.
  
  SunCoke Energy Partners (NYSE: SXCP) was the third IPO to debut during a very busy third week of January. SXCP is the first M
• [By Aimee Duffy]

  1. KNOT Offshore Partners (NYSE: KNOP  )
  Ever wonder how the oil gets from the offshore rig to the onshore refinery? Sometimes there's a pipeline, and sometimes there are shuttle tankers, like the ones owned and operated by KNOT Offshore.

Top 5 Services Companies To Invest In 2015: Henry Schein Inc. (HSIC)

Henry Schein, Inc. distributes healthcare products and services primarily to office-based healthcare practitioners. It operates in two segments, Healthcare Distribution and Technology. The Healthcare Distribution segment offers consumable dental products, dental laboratory products, and small equipment, including X-ray products, infection-control products, handpieces, preventatives, impression materials, composites, anesthetics, teeth, dental implants, gypsum, acrylics, articulators, and abrasives; and large dental equipment comprising dental chairs, delivery units and lights, X-ray equipment, equipment repair, and high-tech equipment. It also provides medical products, including branded and generic pharmaceuticals, vaccines, surgical products, diagnostic tests, infection-control products, and vitamins; and animal health products, such as branded and generic pharmaceuticals, surgical and consumable products and services, and equipment. The Technology segment offers softwar e and related products, and value-added products that primarily include practice management software systems for dental and medical practitioners, and animal health clinics. Its services also consist of financial services and continuing education services for practitioners. Henry Schein, Inc. primarily serves dental practitioners and laboratories, physician practices, and animal health clinics, as well as government and other institutions. It operates in the United States, Australia, Austria, Belgium, Canada, China, the Czech Republic, France, Germany, Hong Kong, Ireland, Israel, Italy, Luxembourg, the Netherlands, New Zealand, Portugal, Slovakia, Spain, Switzerland, and the United Kingdom. The company was founded in 1932 and is headquartered in Melville, New York.

Advisors' Opinion:

• [By Charles Mizrahi]

  Several stocks in our portfolio will benefit from this trend: Drugstore chain Walgreens (WAG), healthcare products distributor Henry Schein (HSIC), and pharmaceutical maker AstraZeneca (AZN)

• [By John Bonnanzio]

  The fund�� top holdings are Telsa, Henry Schein (HSIC), United Rentals (URI), Gartner (IT) and Kansas City Southern (KSU).

  The fund also has some exposure to pricey biotech. Even so, this is hardly a shoot-the-lights-out growth fund as volatility is below all his mid-cap peers. To that end, this trade actually tempers risk while increasing growth exposure.

Top 5 Services Companies To Invest In 2015: Chipotle Mexican Grill Inc.(CMG)

Chipotle Mexican Grill, Inc. develops and operates fast-casual, fresh Mexican food restaurants in the United States, Canada, and England. Its restaurants primarily offer burritos, tacos, burrito bowls, and salads. As of December 31, 2011, it operated 1,230 restaurants, which includes 1 ShopHouse Southeast Asian Kitchen. Chipotle Mexican Grill, Inc. was founded in 1993 and is based in Denver, Colorado.

Advisors' Opinion:

• [By Rick Munarriz]

  4. Burrito and a buzz
  Chipotle Mexican Grill (NYSE: CMG  ) is looking to upgrade its libations.

  The 1,458-unit fast-casual chain will add premium margaritas -- handmade with Patron silver tequila, triple sec, agave nectar, and fresh lime -- to more than 900 of its restaurants in time for next month's Cinco de Mayo festivities.

• [By Holly LaFon]

  But even in conventionally valued stocks where the fundamentals have largely gone our way, it has been hard to make money on shorts. In many cases we��e lost money. Let�� consider Chipotle Mexican Grill (CMG). In recent years through the end of 2011, CMG and other upstarts in the fast-casual restaurant segment achieved substantial growth by offering consumers a higher quality menu than is typically found in fast-food chains. In contrast, Taco Bell (the largest Mexican fast-food chain) had lackluster and often negative growth. In early 2012, Taco Bell expanded its offerings to include new gourmet-style dishes as part of its Cantina Bell menu and introduced Doritos Locos Tacos. We believed that these innovations would enable Taco Bell to recapture market share from CMG. This is exactly what happened:

• [By Tamara Rutter]

  Yum! Brands (NYSE: YUM  ) is struggling with slowing growth lately as the fast-service chain continues to lose favor to fast-casual eateries such as Chipotle Mexican Grill (NYSE: CMG  ) and Panera. People want healthier food, even if it means paying slightly higher prices. This has helped the fast-casual sector become the fastest-growing segment in the restaurant industry today -- even as fast-food joints suffer. However, with more people choosing the fast-casual dining format over fast food, Yum! Brands is rethinking its approach... starting with a makeover of its KFC brand.