Top 5 Rising Stocks To Buy For 2014

One of my very favorite defense contractors reported earnings this past week: Raytheon (NYSE: RTN  ) . Its earnings "beat the Street." Investors cheered. But I'm still not buying the stock. And now I'll tell you why.

Reporting earnings for fiscal Q4 and full-year 2014 Thursday, Raytheon announced that:

Fiscal 2013 sales declined 3%, capped by a veritable collapse in Q4 sales -- down 9%, but operating profit margins actually gained about 20 basis points, rising to 12.4% for the year. Net income climbed 6% as a result, and profits per diluted share grew 9% to $6.16, helped by a share-count reduction of 10 million.

So far, so good -- and it even gets better. Raytheon produced $2.4 billion in cash from operations in 2013, a 22% increase over 2012 operating cash flow. Combined with a modest reduction in cash outflows for capital investment, this translated into free cash flow of $2.1 billion, or a 30% improvement over 2012 FCF.

As a result, Raytheon's now generating about 5% more real, cash profit than it reports as net income under GAAP. Its true valuation is correspondingly cheaper. Rather than the 15.4 "P/E" ratio that you see as the stock's valuation on Yahoo! Finance, it may be better to think of the stock as selling for just 14.4 times free cash flow. Problem is -- that's still not cheap enough.

Hot Stocks To Buy Right Now: Atmel Corporation(ATML)

Atmel Corporation designs, develops, manufactures, and sells semiconductor integrated circuit (IC) products. The company?s Microcontrollers segment provides various proprietary and standard microcontrollers, such as Atmel?s capacitive touch products, including maXTouch and QTouch, AVR 8-bit and 32-bit products, ARM-based products, and Atmel?s 8051 8-bit products. Its Nonvolatile Memories segment offers serial interface electrically erasable programmable read-only memory and serial interface flash memory products; and parallel interface flash memories, as well as parallel interface electrically erasable programmable read-only memory and erasable programmable read-only memory devices. The company?s Radio Frequency and Automotive segment provides products designed for the automotive industry, including automobile electronics, networking and access systems, and engine, lighting, and entertainment components. This segment produces and sells wireless and wired devices for in dustrial, consumer, and automotive applications; and offers foundry services, which produce radio frequency products for the mobile telecommunications market. Its Application Specific Integrated Circuit segment provides custom application specific ICs designed to meet specialized single-customer requirements of high performance devices in a range of specific applications. This segment provides products that provide hardware security for embedded digital systems; and products with military and aerospace applications, as well as develops application specific standard products for space applications, power management, and secure crypto memory products. The company sells its products directly to original equipment manufacturers; and indirectly through a network of distributors. It has operations in the United States, Asia, Europe, South Africa, and Central and South America. Atmel Corporation was founded in 1984 and is headquartered in San Jose, California.

Advisors' Opinion:

• [By Selena Maranjian]

  Among holdings in which SAC Capital Advisors increased its stake was Atmel (NASDAQ: ATML  ) �SAC reduced its stake in companies such as PNC Financial Services,�and Akamai Technologies. Atmel, which makes touchscreen controllers, is sitting near a 52-week high, despite posting shrinking revenue and earnings lately. The company is cutting costs to boost profit margins, and is optimistic, seeing�improving business conditions and a healthier backlog.

• [By Srdjan Bejakovic]

  In the first quarter, semiconductor maker Atmel� (NASDAQ: ATML  ) recorded $337 million in revenue, $7 million above the upper end of its own guidance range. Additionally, management claims that 2014 will be a year of growth and increased profitability for the company, driven by continuing demand for microcontrollers and an improving picture in Atmel's touch business. What's lying behind the surprising revenue numbers, and can Atmel prosper in spite of increasing competition from such solid companies as Microchip Technologies� (NASDAQ: MCHP  ) and Synaptics (NASDAQ: SYNA  ) ?

Top 5 Rising Stocks To Buy For 2014: Elisa Oyj (ELI1V)

Elisa Oyj is a Finland-based Company engaged in the provision of Information and Communication Technology (ICT) services in Finland and Estonia. The Company operates within two business segments: Consumer Customers and Corporate Customers. The Consumer Customers segment provides consumers and households with telecommunications services, such as voice and data services. The Corporate Customers segment provides to the corporate and community customers voice and data services, ICT solutions and contact center services. All the services are provided under the Elisa and Saunalahti brands. The Company�� global alliance partners are Vodafone and Telenor. The Company operates through its subsidiaries, including Appelsiini Finland Oy, Arediv Oy, Ecosite Oy and Elisa Eesti As, among others. Advisors' Opinion:

• [By Adam Ewing]

  A sale would provide the shareholders with cash, while potentially strengthening DNA against larger rivals Elisa Oyj (ELI1V) and TeliaSonera AB. (TLSN) The IPO could be the biggest in Finland, home of Nokia Oyj (NOK1V) and ��ngry Birds��maker Rovio Entertainment Oy, since 2005.

Top 5 Rising Stocks To Buy For 2014: United States Brent Oil Fund LP (BNO)

United States Brent Oil Fund, LP (USBO) is a commodity pool. USBO is focused on issuing units that may be purchased and sold on the NYSE Arca, Inc. The investment objective of USBO is for the daily changes in percentage terms of its units��per unit net asset value (NAV) to reflect the daily changes in percentage terms of the spot price of Brent crude oil, as measured by the daily changes in the price of the futures contract for Brent crude oil traded on the ICE Futures Exchange (the ICE Futures).

The investment portfolio of USBO will consist primarily of investments in futures contracts for crude oil, heating oil, gasoline, natural gas and other petroleum-based fuels that are traded on the ICE Futures, New York Mercantile Exchange (the NYMEX) or other United States and foreign exchanges (collectively, Futures Contracts). USBO may also take positions in other crude oil-related investments, such as cash-settled options on Futures Contracts, forward contracts for oil, cleared swap contracts and non-exchange traded (over-the-counter) transactions that are based on the price of crude oil, other petroleum-based fuels, Futures Contracts and indices based on the foregoing (collectively, Other Crude Oil-Related Investments).

Advisors' Opinion:

• [By Dan Caplinger]

  How to invest
  If those trends persist, then it could eventually solve the problem that United States Oil Fund has had in underperforming the spot price of crude. Given Brent's stronger backwardation trend, United States Brent Oil Fund (NYSEMKT: BNO  ) might be the better oil ETF to choose.

Top 5 Rising Stocks To Buy For 2014: Pool Corporation (POOL)

Pool Corporation operates as a wholesale distributor of swimming pool supplies, equipment, and related leisure products in North America and Europe. The company offers approximately 100,000 national brand and Pool Corporation branded products. It sells maintenance products, such as chemicals, supplies, and pool accessories; repair and replacement parts for cleaners, filters, heaters, pumps, and lights; packaged pool kits, including walls, liners, braces, and coping for in-ground and above-ground pools; pool equipment and components for new pool construction and the remodeling of existing pools; and irrigation and landscape products, such as professional lawn care equipment. The company also offers complementary products, including building materials used for pool installations and remodeling, such as concrete, plumbing and electrical components, and pool surface and decking materials; and other discretionary recreational and related outdoor lifestyle products. Pool Corpora tion serves swimming pool remodelers and builders, retail swimming pool stores, swimming pool repair and service businesses, landscape construction and maintenance contractors, and golf courses. The company was founded in 1993 and is based in Covington, Louisiana.

Advisors' Opinion:

• [By Seth Jayson]

  When judging a company's prospects, how quickly it turns cash outflows into cash inflows can be just as important as how much profit it's booking in the accounting fantasy world we call "earnings." This is one of the first metrics I check when I'm hunting for the market's best stocks. Today, we'll see how it applies to Pool (Nasdaq: POOL  ) .