Emaar, Developer of Mideast's Biggest Mall, to List on Stock Market

aBy Razan Alzayani DUBAI, United Arab Emirates -- Emaar Properties, the developer behind one of the world's largest shopping malls and the world's tallest tower, said Sunday it will launch an initial public offering for part of its retail businessain Dubai in September. The Dubai-based developer said in a statement that it expects to sell at least 15% of the company known as Emaar Malls Group in the offering. Like Emaar Properties, the new company will trade on the Dubai Financial Market. Emaar's retail businessaincludes the vast Dubai Mall, the Mideast's biggest shopping center. It is making 30% of the offering available to individual investors and the rest to institutional investors. Hussam al Husseiny, a chartered market technician, said the news will sway investors who were concerned about liquidity in the market against selling their shares in Emaar. "These little details that Emaar gave will validate the share for people," he said. The company's retail and malls arm recorded $340 million in revenue in the first six months of 2014. The Dubai government owns around a third of Emaar Properties, which has total assets of nearly $19 billion. Emaar Properties shares closed Sunday at 11.15 dirhmas, or roughly $3.03.

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Precious Metals Continue to Show Weakness -- With One Exception

a NEW YORK (TheStreet) -- U.S. markets and leading stocks continue to show strong and positive action, mostly early in the week.aIt really has been a great August, and that is rare, but it just shows that you must always pay attention to things and can't rely wholly on historical or past norms. aa a Does this mean the usually strong fall period will be weak, or does it mean it will be extra strong?aOnly time will tell, and I will be keenly watching for the answers.aAs for the precious metals, gold and silver tried to move higher a couple of times this past week, only to reverse and resume the dominant trend, which remains lower. Gold did gain 0.48% for the week but did so by building a bear flag.aThis gold chart is not at all showing me a sign of a low.aThis chart tells me we still need to move down to test the $1,250 area and see how it handles those levels.aI've said for almost two years now that $1,000 looks like it is going to be tested before an uptrend in gold takes over.aI still believe that to be true when looking at the longer-term monthly chart. Things take time. a Read More: Warren Buffett’s Top 10 Dividend Stocks a a I've talked about the "blood in the streets"amoment, and we have yet to see that.aI haven't seen the long, and wrong, gold bulls even come close to capitulating yet.a Once I see some of them begin to throw in the towel, that will be near the low mark. aa a That said, gold bulls are a different breed and much more stubborn than the run-of-the-mill bull, so it may take some time at lows or an extreme spike below $1,000 to really get them flustered. aa a The trend remains lower for gold. Silver rose 0.57% over the week past and did put in a valiant effort to break out of this bull flag and above the downtrend line. But so far, it has failed.aSilver has been leading gold for the past few weeks and still is. aa a I always get lots of emails when a move is happening in the metals,aand last week was no exception. aa a Tuesday and Thursday, early in the day, the emails were flooding in telling me lots of reasons why gold and silver were now on the way back to the moon.a Those emails stopped coming in later in the day, once the moves faded. aa a It never seizes to amaze me how quickly people can flip or jump on a trend well before it is anything even remotely close to a trend.aYou really don't have to nail a low at all.a If a trend is true it will give you many, many chances to jump on board during its lifetime.aI need to see some very constructive action before I am convinced of a trend change. We are not close to that in the metals yet. aa a Silver remains in the bear flag and on the way to $18.75;a$15 is major support on the monthly chart. I still hold to the thought that the area will be tested before we can consider a true low to be in. Platinum clawed out a 0.17% gain for the week and is also building a bear flag.aPlatinum follows gold and silver, and this bear flag points to a move down to $1,360, which also has horizontal chart support. Palladium continues to shed the weakness and march to its own beat, rising 2.01% this past week, back into all-time highs.aPalladium certainly isn't moving as strongly higher as it could be if the other metals weren't so weak but it is doing well.aAs long as palladium remains above $890 it's all good for higher prices. aa a While metals remain weak, with the exception of palladium, biotechaand health careastocks remain the place to be to cash in on this market strength.aaI like to think I have the best of the bunch, in terms of stocks, and I do.aThere is no point in being in weak stocks or sectors and hoping for a move, when you can be in the stocks that are moving. Read More: Biotech Stock Boom Times Are Back aa a Takeovers are a big theme in the biotechaarena, and we were lucky enough to grab a huge premium on such news this past week.a I'm also in a few other stocksathat have that same potential in the short-term. aa a Thank you very much for reading. Mark Bevan atahttp://wizzentrading.com This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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Hubris of Market Bulls; Second-Quarter Big Picture: Best of Kass

NEW YORK (TheStreet) -- Doug Kass of Seabreeze Partners is known for his accurate stock market calls and keen insights into the economy, which he shares with RealMoney Pro readers in his daily trading diary. Last week, Kass wrote about what market hubris tells us, and less than meets the eye in the quarterly earnings increases. Please click here for information about subscribing to RealMoney Pro. The Hubris of Bull Markets Originally published on Monday, Aug. 25, at 12:33 p.m. EDT Hubris: excessive pride or self-confidence. Synonyms: arrogance, conceit, haughtiness, hauteur, pride, self-importance, egotism, pomposity, superciliousness, superiority. Informal bigheadedness, cockiness "The hubris among economists was shaken." Antonyms: humility (In Greek tragedy) excessive pride toward or defiance of the gods, leading to nemesis. Read More: 7 Stocks Warren Buffett Is Selling in 2014 I have long reasoned and written that the crowd usually outsmarts the remnants (except at inflection points). Today, the crowd possesses strong animal spirits, and investors/traders have taken the S&P to all-time highs. There is nary a bear remaining. Shorts are routinely criticized and even laughed at. And maybe the bears should be scolded and criticized, but in listening further to the parade of self-confident talking heads who are so complacent of view (and not heeding any possible adverse outcomes), my antenna is up -- way up -- now. I have been clearly (and incorrectly) leaning to the short side in 2014 as stocks have outshot my price expectations. Many times in my four decades of investment experience, I have seen the sort of hubris that is demonstrated these days, but rarely to such a degree. It is a clear and unqualified red flag, especially when markets are faced with the reality of a number of headwinds (including unsustainable profit margins), a world plagued with serious geopolitical risks and threats, domestic and economic growth that remains subpar (despite aggressive central banker policy five years into the economic cycle), inflated valuations (against normalized earnings power), and other issues. While I have not added to my index shorts, I have lifted my net short exposure by taking some of my gains in several longs, including Citigroupa and Bon-Ton Storesa . At the time of publication, the author was long C and BONT, although positions may change at any time.a Second-Quarter Big Picture Originally published on Friday, Aug. 29, at 7:54 a.m. EDT Most of the second-quarter earnings reports are now in, and it appears that S&P earnings rose by about 9.4% (year over year). This gain is about 300 basis points above consensus expectations and was achieved with about +4% top line expansion. Energy, health care and technology were the only sectors achieving better than 4% sales growth in the quarter. In terms of quality, there was less than meets the eye, with buybacks, lower interest expenses and lower effective tax rates contributing to more than 2% of the 9.4% growth. Productivity gains contributed to a surprising margin expansion of about 3% of the 9.4% earnings per share gain. Read More: 10 Stocks Carl Icahn Loves in 2014 In second-quarter 2014, 69% of the companies beat expectations on the bottom line and a bit more than 50% beat on the top line, about in line with history. Full-year S&P earnings look as if they will fall between $118 and $119 aashare (+7% year over year), higher than I expected at year-end 2013. (The current top-down consensus is $117 a share, and bottom-up consensus now stands at $119.40 aashare.) Sales look likely to grow at about 4.5% for the full year. Looking into next year, consensus sees about $125 a share in earnings achieved by some margin expansion and near-5% revenue growth. Though 2014 results seem destined to beat my expectations, a lot of the gains were through financial engineering (which seemingly should be accorded a lower price earnings multiple vis-a-vis organic growth).a a

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Pandora and Apple Will Bail Out the Music Industry

PORTLAND, Ore. (TheStreet) -- Streaming music won't stop the music industry's bleeding, but it may slow it just enough to let both artists and labels alike figure out its future. A new report from English data firm Juniper Research finds that digital music industry will see worldwide revenue grow from $12.3 billion this year to $13.9 billion in 2019. Juniper's research indicates that even that grown hinges on the streaming music sector bringing in more cash as sales of digital downloads, ringtones and ringback tones continue to plummet. That isn't exactly out of line with what Billboard and Nielsen Soundscan are seeing here in the U.S. During the first six months of 2014, Nielsen Soundscan found that on-demand streams through both audio and video services like Google'sa aYouTube, IAC's Vimeo, Spotify, Pandora aand recent Applea acquisition Beats Music are up 42% from the period last year. That's a jump from 49.5 million total streams to more than 70 million and includes a 50% leap in audio music streaming to 33.6 million. That still lags behind video streaming, which accounted for 36.6 million music streams in early 2014 and jumped 35% from last year. Read More: Vinyl Is The Only Way To Buy Music That growth comes as any album that isn't released on vinyl dies a horrible death. Nielsen Soundscan equates 2,000 streams to one album, but even with that in the equation, album sales are down 3.3% through June. Take streaming out of the mix and you're looking at a 14.3% drop from the same time last year. The nearly 20% drop in compact disc sales over the last year is almost expected as CDs continue their post-'90s free fall, but the 11.6% drop in digital album sales and 13% drop in digital track sales is far more troubling. Digital download sales fell for the first time last year and aren't coming back. People aren't loading up their smartphones with songs anymore and aren't carrying iPods anymore. That's not great news for the music industry, which uses digital track sales as a crutch to limp toward respectable numbers. When you factor in "Track Equivalent Albums" -- a stataathat equates 10 of an artist's tracks withaone album -- Katy Perry, Pharrell Williams, Lorde and Beyonce all had albums sell 1 million copies and go platinum this year. Take those individual tracks away and reduce album sales to strictly physical and digital albums in their entirety, and suddenly Beyonce, Lorde, Coldplay and Eric Church are the only artists to go gold and break 500,000 sales this year. The only album to go platinum by that measure? The soundtrack to Disney's Frozen, with 2.7 million copies sold in the first six months of 2014. Read More: Amazon Prime Music Just Set Streaming Music's Price According to Nielsen, album sales of any kind plummeted from 755 million copies in 1999 to just 290 million last year. Compact disc sales have fallen steadily from 730 million in 2000 to just 165 million last year. This year, the Frozen soundtrack was the only digital album to sell 1 million copies -- or even more than 350,000. Meanwhile, even as digital track sales fall, singles sales remain strong. Pharrell's Happy sold 5.6 million copies in just six months. Katy Perry and Juicy J's Dark Horse broke 4 million, but even artists a bit further down the chart are more representative of what anyone's actually listening to. DJ Snake, Iggy Azalea, Bastille and Aloe Blacc are absent from the first-half album charts, but all sold more than 2 million copies of their singles Turn Down For What, Fancy, Pompeii and Man. Move it over to on-demand streaming, and those 2 million to 5 million sales turn into 40 million to 65 million audio streams and 70 million to 120 million video streams. Psy's Gangnam Style still managed 69 million video streams this year after making more than $1 million off of streaming royalties alone last year. Google CEO Larry Page watched Psy's viral hit rake in $2 per 1,000 pageviews and called it "a glimpse of the future." By that measure, the 122 million views Perry's Dark Horse received through June adds up to $244,000 alone. It isn't seven figures, but it's a whole lot of cash for one song doing six months of work. Companies that aren't Google still haven't quite figured out how to make streaming generate a ton of money for them, but that doesn't mean they aren't trying. Juniper observed that offerings from streaming music providers, such as Spotify and Pandora, will increasingly find themselves competing with personalized services from bigger firms including Google and Apple. As it stands, Pandora is already leaning more heavily on advertising, adding more commercials to its free service while raising the monthly cost to Pandora One subscribers from $3.99 to $4.99 earlier this year. While both Pandora (with 31% of the streaming market) and ClearChannel'sa iHeartRadio (9%) have made their free services work with help from advertisers, they're starting to sound a whole lot like regular radio at a time when they can ill afford to. Newcomers like Apple's iTunes Radio, with 8% of the total streaming audience, will only get more dangerous as they develop a commercial-free strategy. Apple's been trying to make iTunes Radio pay off by coaxing users into purchasing downloads of the songs they're hearing. That strategy has backfired spectacularly, with only 2% of users ever pushing the "buy" button. Amazon, meanwhile, worked its Prime Music streaming service into the $99 annual price of Amazon Prime -- which also includes free video streaming and two-day deliveries from Amazon's online marketplace. Juniper notes that there are still large threats to the music industry from piracy in markets like China, but is especially wary of the industry eating itself as Apple, Amazon and Google press further into the streaming business. Apple's recent acquisition of Beats Music shows it's serious about taking the next step, while both Amazon and Google already have the streaming infrastructure in place to be a serious threat to Pandora, Spotify, Rdio and other strictly streaming services. As the music industry continues to gravitate away from an ownership model and toward its streaming future, it'll take any gains it can get. A robust streaming ecosystem is great for everyone involved, but if cannibalization limits both artist and label options, the same losses plaguing physical album sales and digital album and track sales now could kneecap streaming in the not-so-distant future. Read More: Apple Has No Idea How Streaming Music Works -- Written by Jason Notte in Portland, Ore.a >To contact the writer of this article, click here: Jason Notte. >To follow the writer on Twitter, go to http://ift.tt/10VKwNf. >To submit a news tip, send an email to: tips@thestreet.com.

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Study: New Novartis Heart Failure Drug Shows Big Promise

By Marilynn Marchione A new study reports one of the biggest potential advances against heart failure in more than a decade -- a first-of-a-kind, experimental drug that lowered the chances of death or hospitalization by about 20 percent. Doctors say theaNovartis drug -- which doesn't have a name yet -- seems like one of those rare, breakthrough therapies that could quickly change care for more than half of the 6 million Americans and 24 million people worldwide with heart failure. "This is a new day" for patients, said Dr. Clyde Yancy, cardiology chief at Northwestern University in Chicago and a former American Heart Association president. "It's been at least a decade since we've had a breakthrough of this magnitude," said Yancy, who had no role in the study. The study involved nearly 8,500 people in 47 countries and was the largest experiment ever done in heart failure. It was paid for, designed and partly run byaNovartis, based in Basel, Switzerland. Independent monitors stopped the study in April, seven months earlier than planned, when it was clear the drug was better than an older one that is standard now. During the 27-month study, theaNovartisadrug cut the chances of dying of heart-related causes by 20 percent and for any reason by 16 percent, compared to the older drug. It also reduced the risk of being hospitalized for heart failure by 21 percent. "We are really excited," said one study leader, Dr. Milton Packer of UT Southwestern Medical Center in Dallas. The benefit "exceeded our original expectations." Results were disclosed Saturday at a European Society of Cardiology conference in Barcelona and published online by the New England Journal of Medicine. Novartisawill seek approval for the drug -- for now called LCZ696 -- by the end of this year in the United States and early next year in Europe. Heart failure is the top reason older people are hospitalized, and a leading cause of death. It develops when the heart muscle weakens over time and can no longer pump effectively, often because of damage from a heart attack. Fluid can back up into the lungs and leave people gasping for breath. The people in this study were already taking three to five medicines to control the condition. One medicine often used is an ACE inhibitor, and the study tested one of these -- enalapril, sold as Vasotec and in generic form -- against theaNovartisadrug. The new drug is a twice-a-day pill combination of two medicines that block the effects of substances that harm the heart while also preserving ones that help protect it. One of the medicines also dilates blood vessels and allows the heart to pump more effectively. In the study, 26.5% on the older drug, enalapril, died of heart-related causes or were hospitalized for heart failure versus less than 22% of those on the Novartisadrug. Quality of life also was better with the experimental drug. "We now have a way of stabilizing and managing their disease which is better than what we could offer them before," Packer said. The new drug also seemed safe -- reassuring because safety concerns doomed a couple of other promising-looking treatments over the last decade. There were more cases of too-low blood pressure and non-serious swelling beneath the skin with theaNovartisadrug, but more kidney problems, excess potassium in the blood and cough with the older drug. More people on the older treatment dropped out of the study than those on the new one. About 32 people would need to be treated with the new drug to prevent one death from heart-related causes. "That's a favorable number," said Dr. Joseph G. Rogers, a Duke University cardiologist with no role in the study. He said the benefits were big enough that "I would switch people over" as soon as the drug is available. The drug "may well represent a new threshold of hope" for patients, Dr. Mariell Jessup, heart failure chief at the University of Pennsylvania, wrote in a commentary in the journal. It may help "a wide spectrum of patients, even those who are currently receiving the best possible therapy."a

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Hottest Stock I Follow; Best Buy and Macy's: Jim Cramer's Best Blogs

NEW YORK (TheStreet) --aJim Cramerafills his blog onaRealMoneyaevery day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he blogged on: Emerge Energy Services and its trajectory, and What's propping up retail. Click hereafor information onaRealMoney, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time. The Hottest Stock I Follow Posted at 4:15 p.m. EST on Friday, Aug. 29, 2014 You may not knowaEmerge Energy Servicesa , a company I have had on "Mad Money" a couple of times. But the trajectory of this one speaks loudly about these last few days. It's the largest frack sand company and the company is doing everything it can to ship as much sand as possible around the country to meet fracking needs. It's big bottleneck? It needs to double the number of railcars it has to get the sand to where it has to be. Emerge has the hottest stock of any I follow, includingaTeslaa andaNetflixa . It has the greatest demand of any company I know and it shows no sign of letting up because it is a superior replacement for ceramic proppant, which is now costing too much if you want to drill and drill fast. Read More:aWhy the American Worker Is Miserable This Labor Day And who wants to drill and drill fast? How aboutaWPX Energya ? How aboutCimarex Energya ? How aboutaAnadarkoa ,aContinentala ,aNoblea ,aApachea ,aMarathona ,aCarrizoa ,aRangea ,aCabota andPioneera ? These companies and dozens like them are all going full out and can't get the oil out fast enough. There had been fear that this quarter would have the production growth, but not the product price. There is also fear that there isn't enough space to put the stuff. But I think that the good ones have the pipe and will get it to the market. This group will become the go-to as we see the end game: Ukraine wants to be in NATO and Russia simply can't let that happen. The group goes higher. You have to hope for a couple of down days to get in and, at the pace that Ukraine-Russia is escalating, you just might not get a chance.a At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, had no positions in the stocks mentioned. Best Buy and Macy's Say It All Posted at 2:21 p.m. EST on Wednesday, Aug. 27, 2014 Best Buya andaMacy'sa asay it all. Both missed. Both guided down. Both were pretty shocking, Macy's because it has been amazingly consistent and Best Buy because, honestly, the commentary could not have been more negative. Macy's got hammered and it turned out to be a fabulous buying opportunity. Why? Try as I have, I don't know. Maybe it is just a belief that things are getting better. Maybe because people believe that the lower gasoline goes, the better Macy's does. Perhaps it was an aberration? Maybe they saw howaJ.C. Penneya acame back but not so much that it made a difference? Maybe it was a recognition that there has been less price-cutting in the group? We don't even know.aNo one has the answera-- but I have heard a lot of conjecture. The simple fact is that there is a huge bid under retail and Macy's is retail. Best Buy was far worse than Macy's was. The commentary was simply awful. When I read it, I said to myself, "They are telling you to sell this stock because they are going to get their heads beaten in byaAmazona ." Read More:aHot Stories After Labor Day But, like Macy's, it didn't matter. Now the stock is going higher. You can say, "Well, wait, like Macy's, we didn't get any real downgrades." Still, though, it's working, and that's what matters. So what is up with all of this? OK, here's what I see is happening. If you look at the good performers in the group --aTJXa ,aRoss Storesa aandaUrban Outfitters a-- and you notice thataTargeta didn't go down on that horrendous quarter, you have to conclude two things: The back to school season is going much better than you think, and People are betting that the holiday season is going to be very strong. In Best Buy's case, it is betting that the holiday season is going to be better because of gaming, new cellphones and newaGoProa devices, all of which are in the Best Buy sweet spot. Like the other day, when I opined that you didn't have to worry about the bank stocks' rally because they don't report for a long time, you can speculate that holiday season can take these retailers far -- provided that you don't get any real bad back-to-school commentary. I think you have to believe that you would have already if that were the case. Read More:aLabor Day Shopping: The Best and Worst Deals This Weekend Hence, why the move has legs. Hence, why you have to buy stocks of companies that didn't report good numbers, betting that the future is brighter. I get it. I wish it weren't like that, but I get it and I think that's the real reason why theaSPDR S&P Retail ETFa seems to have a bid underneath it, no matter what's said or done. Random Musings: The suspicious buying inaKellogga ais so persistent, who doesn't' want to go long it? The selling inaSunTrusta ais ridiculous, but it keeps happening. I think the fact thataSeaDrilla aisn't down badly on that terrible number means two things: one, some analysts will still downgrade it tomorrow but, two, because they are not buying more ships, we are putting in a bottom. I hear Doug Kass onasocial-media stocks. They will be doggie as long as there is a threat of monster IPOs ahead. But I also know the earnings-per-share power ofaFacebook ,aGooglea aand evenaTwittera abeckons and I wouldn't sellaYelpa ano matter what. GoPro andaMobileyea are the two new specs that are loved and will stay that way for a long time. At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, was long FB and GOOGL. a

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Who Put the 'Crazy' in El Pollo Loco?

NEW YORK (TheStreet) -- The Crazy Chicken is looking more like The Crazy Investor. El Pollo Locoa was founded by Juan Francisco Ochoa in the small town of Guasave in the State of Sinaloa in 1975. You can check a picture of the very first restaurant here. Today, there are many restaurants in five states, including Coahuila, Michoacan, Nuevo Leon, Sinaloa and Tamaulipas. They're also in Mexico City, an urban area almost as populated as New York City. Read More:aGreenberg: Getting Restaurant IPO Indigestion These restaurants are a separate company. Maybe an investment banker should cross the Rio Bravo and convince them to file for an IPO with the symbol POLLO just like Arcos Dorados Holdingsa , independent operator of McDonald's restaurants in Latin America, already did back in 2011. There are two McDonald's: One is currently the most profitable restaurant in the world with annual sales of $28.1 billion and annual profits of $5.6 billion The otheraone is currently McDonald's largest franchisee in the world with 94,000 employees, 2,070 restaurants and it serves over 4,300,000 customers daily in Argentina, Aruba, Brazil, Chile, Colombia, Costa Rica, Curacao, Ecuador, French Guiana, Guadeloupe, Martinique, Mexico, Panama, Puerto Rico, Peru, St. Croix, St. Thomas, Trinidad & Tobago, Uruguay and Venezuela. There are two El Pollo Locosabecause Denny'sa bought all the restaurants within the United States of America in 1983. In 1999 the company was sold to a private equity firm and in 2005 the company was sold again to another private equity company. a When you are investing in LOCOayou are only investing in the 399 restaurants currently open in Nevada, Arizona, Utah, Texas and California. The current shareholders have been trying to make money for nine long years without success and they finally decided to sell their shares to individual investors in an IPO priced at $15 a share. The demand for these shares was irrationally exuberant and the stock opened at $19 on the first day of trading. A few weeks later, the company has a market value of more than a cool billion dollars. To put that in perspective, you could buy more than 75% of Dean Foodsa right now with the same amount of cash. Dean Foods has been around since 1925 and they are never going to go out of business. If another global financial crisis hits them hard in the future and the annual profits evaporate overnight somehow, they can always sell one or more of their factories in Belgium, France, the United Kingdom and/or the Netherlands. The human race cannot survive without milk.aDean Foods is currently one of the largest food processing companies in the entire world and without them we would be dead by now. With annual sales of $9.6 billion, they sell more food than Chipotle Mexican Grilla and Tim Hortonsa combined.aWith annual profits of $300 million, they make more money than Olive Garden, LongHorn Steakhouse, Bahama Breeze, Seasons 52, Eddie V's Prime Seafood, The Capital Grille , Yard House and Wildfish Seafood Grille combined. Dean Foods feeds the whole world. El Pollo Loco feeds just a few hungry individuals in a few cities. Let's imagine for a second that you are the CEO of Dean Foods and you wish to enter the fast food industry and you decide to invest 100% of all your profits in a restaurant. With $300 million a year, you can buy all the El Pollo Loco shares in just four years, assuming the stock price remains constant. On the other hand, El Pollo Loco cannot invest their annual profits in any Dean Foods shares simply because they don't have any profits. They lost $16.9 million in 2013, $7.9 million in 2012 and $32.5 million in 2011 according to Nation's Restaurant News. They only opened seven restaurants in 2013 and they are planning to open only 16 restaurants in 2014 according to Forbes, which means they are not exactly taking the world by storm. You have to be insane in the brain to buy this company at current levels. I strongly suggest you to sell short this company. At the time of publication the author had no position in any of the stocks mentioned andacould not enjoy the tasty chicken because he lives 91 miles away from the nearest El Pollo Loco. This article is commentary by anaoutside contributor,aseparate from TheStreet's content.

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Tim Hortons Coffee Can't Perk Up Burger King

PORTLAND, Ore. (TheStreet) -- Burger Kinga bought Tim Hortons for a lot of reasons, but the one that affects consumers most is likely the weakest. It may have spent $11 billion (with help from Warren Buffett) to make Brazilian backers 3G Capital and owner Jorge Paulo Lemann a fortune, which is fine. Or the dealamay have been made to dodge U.S. taxes and mandates for employee health care in favor of a new home country with a universal health care system -- which is certainly its right. It may have been a search for higher ground on the sinking island that is the quick-service food industry, which isn't all that great a move, really. Read More: Olive Garden Is the Hill Darden Wants to Die On But if it's to give the flagship chain better coffee while giving the company as a whole a means of ditching fast food for a foray into the fast-casual segment that's treating Paneraa and Chipotlea so well, then Burger King has a shorter memory than any of us could imagine. Tim Horton's has been a welcome presence in Upstate New York and several Great Lakes states since the mid-1980s, but a push to expandaits U.S. footprint back in 2010 slammed to a halt as it withdrew from Dunkin Donutsa territory and closed 36 stores in New England. The chain still has more than 800 locations in the U.S. -- up from 500 in 2008 -- but that pales in comparison to its more than 3,400 Canadian locations. a The same year that Tim Horton's hit the wall in the U.S., Burger King attempted to revamp its menu by offering coffee made by Starbucks subsidiary brand Seattle's Best. That not only failed to improve sales, but led to Burger King's $3.2 billion sale to 3G Capital later that year. But the Seattle's Best brand stuck around -- brewing a "Smooth Roast Coffee" especially for the burger chain last year -- and was soon surrounded pulled pork sandwiches, smoothies, sweet potato fries and even delivery in some markets back in 2012. As company-owned stores were sold to franchisees and sales improved, share prices more than doubled. But its lack of breakfast sales and continued pummeling by McDonald's , whose Egg McMuffin and McCafe coffee -- itself an upgrade from Newman's Own organic coffee that it used to give away for $1 -- still dominate fast-food breakfast. As other coffee competitors, including Caribou and Peet's, were bought up by German holding company Joh A. Bensicker in 2012 and both Dunkin Donuts and Starbucks expanded, Burger King saw both its breakfast options and burger niche -- now endangered by better-burger chains like Five Guys and Smashburger -- endangered. Read More: Have American Consumers Become Snobs? Overall, the quick-service food industry that includes low-priced fast-food chains such as Burger King has never recovered from the recession. According to market research firm NPD Group, traffic at quick-service restaurants in the U.S. dove 3% in 2009 and another 2% in 2010 before reporting flat growth for two out of the three years that followed. Fast-food chains only saw increased traffic in 2012, and only a 1% increase at that. Traffic has been similarly flat for the first half of 2014. Meanwhile, fast-casual establishments like Panera and Chipotle have added locations and watched traffic increase steadily each year since 2009. That's prompted steadily performing chains like Starbucks to add beer, wine and small-plate meals to the menu just to get a piece of that changing marketplace. But that isn't what Burger King will be getting with its purchase of Tim Horton's. The Canadian chain just added espresso machines in 2011 and has a menu that's still stacked with donuts, muffins, bagels and Timbits. They branch out into egg sandwiches, hash browns, oatmeal, paninis, wraps and bowls of soup and chili, but they're more aesthetically akin to a Dunkin Donuts than they are to a Panera. You're more likely to find one with a few booths in a truck stop along the New York State Thruway than you are to see one with couches and smooth jazz in a downtown shopping district. That's just not what Tim Hortons is. Loyalists love the quality of its coffee and pastry, its ease and convenience, its warmth on a cold day and its script on the ice at a hockey game. It's fast, but it's a step below casual in a shrinking segment of the restaurant market. Burger King made a bigger move toward fast-casual when it served up pulled pork and smoothies than it did by buying Tim Hortons. If Burger King is OK with bankrolling Tim Hortons' fight against Starbucks and Dunkin Donuts in markets along the border and in snowbird locations along the coasts, then that's money well spent. If it's once again trying to take its breakfast menu upscale or trying to get within a sniff of Panera Bread, then a box of Timbits won't get it there. Read More: Pumpkin Ale Is Ridiculously Vital to Craft Beer -- Written by Jason Notte in Portland, Ore. At the time of publication, the author held no positions in any of the stocks mentioned. This article is commentary by an independent contributor, separate from TheStreet's regular news coverage. >To contact the writer of this article, click here: Jason Notte. >To follow the writer on Twitter, go to http://ift.tt/10VKwNf. >To submit a news tip, send an email to: tips@thestreet.com.

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Chevron, Schlumberger the Early-Bird Winners of Mexico’s Oil Reforms

NEW YORK (TheStreet) -- Thanks to landmark oil industry reforms, Mexico is gearing up to explore its undeveloped deepwater oil reserves, which could hold roughly twice as much oil as the nation's existing proven reserves. This could open doors to new business opportunities for Chevron and Schlumberger which could become the earliest and the biggest beneficiaries of the oil reforms. Since 1938, Mexico's oil and gas reserves have been off-limits to foreign companies. However, earlier this month Mexico's President Enrique Pena Nieto signed into law changes that end the 75-year-old monopoly of the government-owned energy behemoth Pemex on the country's enormous 13.5 billion barrels of oil reserves while opening up the nation's energy sector to foreign investors. Read More: 10 Stocks George Soros Is Buying Schlumberger's shares, at around $110, have risen by 22% for the year to date, while Chevron stock, at around $129, is up by 3% for the same period. Not only does the law end the Pemex monopoly but it allows the nation to tap into its deepwater as well as unconventional reserves -- Pemex does not have the skills to carry out the complex drilling and production operations. In an email to TheStreet, Robert MacKenzie, the director of research at Iberia Capital has said that Mexico's deepwater assets represent "perhaps the most prospective untapped resource on the globe." The earliest beneficiaries of the Mexican reforms could be the oilfield services companies that will carry the ground work for other exploration and production companies -- and that's where Schlumberger comes in. In an email to TheStreet, Joao Felix, Schlumberger's director of external communications, said the company sees Mexico's oil reforms as a "significant step in the evolution of the country's oil and gas industry." The company is optimistic about "various business opportunities" in Mexico, ranging from deepwater to shale oil and gas projects. Schlumberger already has significant operations in Mexico. Moreover, the company has a solid track record of working on various deepwater projects around the world, including at the U.S. Gulf of Mexico. Schlumberger might find significant opportunities on the Mexican side of the Gulf of Mexico, which is largely undeveloped and could hold as much as 27 billion barrels of oil reserves. Read More: ConocoPhillips, Cut by Warren Buffett, Can Be Yours on the Rebound Chevron, on the other hand, could be one of the biggest beneficiaries in the long run. The oil major is not only the second biggest player in the industry but also one of the biggest leaseholders and producers at the U.S. Gulf of Mexico. Last year, Chevron produced 91,000 barrels of crude oil, 69 million cubic feet of natural gas and nearly 8,000 barrels of natural gas liquids on a daily basis from deepwater Gulf of Mexico. Moreover, the company will start up three major deepwater Gulf of Mexico projects through 2015 which could give a boost to its output from the region. The Mexican oil reforms can allow Chevron to expand its foothold to the Mexican portion of the Gulf of Mexico. Chevron has already reported oil discoveries at the Lower Tertiary Trend in the deepwater U.S. Gulf of Mexico, a region which extends well into Mexican waters. Chevron's representative declined to comment. Overall, the impact of reforms on the country's oil production is going to be profound, as per projection by the U.S. Energy Information Administration. Last year, the agency gave a gloomy long-term forecast for the country's oil production, which was expected to drop from three million barrels a day in 2010 to around 2 million barrels a day by 2040. However, following the reforms, EIA believes that Mexico's production could increase to 3.7 million barrels a day by 2040. Pemex has been awarded rights for 83% of the country's reserves, exactly what it requested, but it got just 21% of the future reserves, lower than what it asked. The company is expected to start seeking partners for these properties later this year. The first round of bidding, in which foreign companies will also participate, is expected to occur in the first half of 2015. Besides Chevron and Schlumberger, other U.S. companies can profit from Mexico's new law. Exxon Mobil , a major player in Mexico's chemicals industry, could start diversifying into other areas. Similarly, EOG Resources , the biggest producer at Texas's Eagle Ford Shale, could expand its operations to the Mexican side of Eagle Ford. Read More: Family Dollar Takeover: The Ball Is in Dollar General’s Court Additionally, MacKenzie, the Iberia Capital analyst, said Halliburton will take advantage of the increasing expenditure on the development of Mexico's onshore and shale reserves. At the time of publication, the author held no positions in any of the stocks mentioned, although positions may change at any time. This article is commentary by an independent contributor, separate from TheStreet's regular news coverage. TheStreet Ratings team rates SCHLUMBERGER LTD as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation: "We rate SCHLUMBERGER LTD (SLB) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, solid stock price performance and good cash flow from operations. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

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