A major Phase 1 takeover...

 Great news for two of our portfolio companies...

 

Private-equity firm GTCR purchased marketing-software company Vocus for $446.5 million.

 

Phase 1 Investor editor Frank Curzio and his analyst Larsen Kusick recommended buying Vocus as a way to profit from the megatrend in Big Data, the massive amount of data and storage we need in an increasingly connected and online world.

 

Vocus was expanding from public-relations-focused software to marketing software. As Frank wrote in his June 2013 issue...

 

This company's software helps companies analyze massive amounts of data across social networking sites like Facebook and Twitter. Then it creates marketing campaigns for its 120,000-plus clients to target this mass audience...

 

Shares of this small-cap tech company could triple within 24 months. That's probably why insiders are buying millions of dollars' worth of shares at the current price.

 

 But the real opportunity with Vocus was how hated the stock was. You can make huge returns when you're willing to invest where no one else will. As the famous saying goes, "buy when there's blood in the streets"... And Wall Street had left Vocus for dead. From that issue...

 

As you know, we love to buy hated stocks in Phase 1. And Vocus may be the most hated technology company in the world. After lowering earnings again in April, every Wall Street analyst covering the stock downgraded shares. That explains the sharp move lower in the stock price.   Vocus operates in one of the premier growth industries in technology. Right now, the company is going through a rough patch. Wall Street has completely given up on the stock, giving us an unbelievable opportunity to buy this name.

 

Since the June issue, Frank's subscribers are up 103%.

 

 We also got some good news about Stansberry's Investment Advisory recommendation Anadarko Petroleum...

 

Anadarko got whacked in December after a judge ruled it may be on the hook for billions of dollars of environmental liabilities. The stock tumbled from $83 a share to $78 in one trading day. But Porter and his team urged readers not to sell. Here's what they said in the December issue...

 

A judge ruled that the oil firm Anadarko may be liable for $5 billion-$14 billion of environmental liabilities incurred when it bought the energy firm Kerr McGee in 2006. These liabilities were on the books of a Kerr McGee subsidiary called Tronox, a chemical business Kerr McGee spun off as a separate public company prior to the Anadarko acquisition. Tronox filed for bankruptcy in 2009. It is the Tronox creditors that sued Kerr McGee (its former parent) and Anadarko.

 

As Porter and his team pointed out, Anadarko knew it might be on the hook for some of the Tronox liabilities. But the company estimated a "worst-case settlement" would be in the neighborhood of $1.4 billion...

 

The judge's ruling treads close to new legal precedent. As Bloomberg reported, the ruling "weighed how much money can be recovered from a successor to a polluting company, even after bankruptcy has ostensibly cleaned the slate of obligations."   Obviously, Anadarko has appealed this unexpected judgment. It will be years before this is resolved. It seems hard to fathom that Anadarko will be expected to pay $5 billion of liabilities related to a company that was spun off from Kerr McGee prior to the acquisition.   As we contemplate this unexpected turn of events, we take comfort in knowing that Anadarko has a $7 billion cash hoard and access to tens of billions more. No matter where this case heads, Anadarko clearly has the financial stability to handle even this new "worst case." As we outlined last month, Anadarko has great prospects. Nothing about our central thesis has changed. As always, we urge you to mind your trailing stop losses.

 

 Porter and his team's estimation ended up being too conservative. Last week, Anadarko agreed to pay $5.2 billion to settle the dispute. That's a lot of money... In fact, it was the Department of Justice's largest environmental enforcement recovery ever – even bigger than the $4 billion BP paid following the 2010 Deepwater Horizon spill.

 

But it was much less than the maximum potential fine of $14.2 billion. As a result, the market was relieved... Anadarko shares jumped 14.5% higher on the day.

 

 There's an important takeaway here... If you're considering buying a high-quality stock and it takes a hit due to legal troubles or one-time charges that don't affect the fundamental business... it can make for a great entry point.

 

 A perfect example of this happened in December with retail giant Target... The company's stock got crushed after it reported a security breach that exposed some 70 million customers' credit-card information.

 

Dr. David "Doc" Eifrig took advantage of the sagging share price to add Target to his Retirement Millionaire portfolio. He wrote...

 

You don't often get a chance to buy a company that has raised its dividend for 46 straight years after it has fallen 23% in six months. I can't even recall a bargain this good...   The problem is that Target made headlines in December when it reported a security breach that exposed the personal information and credit-card numbers of as many as 70 million customers to thieves. It was the second-largest known cyber-attack on a retailer, behind a 2007 attack on the TJX Co. chains T.J. Maxx and Marshall's...

 

As Doc noted, Target shares were already down from their mid-summer highs when the security attack was disclosed...

 

That drop mostly reflected the market's response to ongoing challenges Target has faced from its two-year-old buyout of 220 Zeller Canadian chain stores. Getting them converted to Target stores was draining earnings. The added 11% dip in share price from the data breach is giving us a great opportunity to invest in Target.

 

 Sure, the security breach was bad news... But it wasn't going to keep Target from continuing to generate huge profits and paying a healthy dividend.

 

In late February, the company posted better-than-expected fourth-quarter and full-year 2013 earnings. Net income and sales both dropped from the year before, but the bar was set extremely low because of the data breach.

 

And Target CEO Gregg Steinhafel addressed the company's problems head-on. Target offered a weekend of 10% discounts in December and a year of free credit monitoring to those affected. In a statement, Steinhafel said...

 

We will continue to work tirelessly to win back the confidence of our guests and deliver irresistible merchandise and offers, and we are encouraged that sales trends have improved in recent weeks.

 

 Target had its biggest one-day jump since 2009 on the news. Retirement Millionaire subscribers are currently up 8% on Doc's recommendation.

 

 We'll end today's Digest with another Ukraine update from Kim Iskyan, who thinks the situation is escalating. (Kim also shared some of his insight in yesterday's Digest.) In an e-mail, Kim explained that things are about to get worse...

 

First... the price that Russia charges Ukraine for gas has doubled in the past week. Russia canceled the gas price discount that it had tied to leasing a port for its Black Sea fleet. Since Crimea, where the port was situated, is now part of Russia, it no longer has to pay rent to Ukraine... and is also getting more aggressive about calling in old debts that Ukraine owes. Russia has been lenient with Ukraine regarding gas prices. But now Russia will take any advantage it can get. Gas is one weak spot for Ukraine... cash flow is another.   So it's looking increasingly likely that Russia might turn off the gas taps in coming weeks. Ukraine can't pay. Funding from the International Monetary Fund won't be rerouted to Russia to pay Kiev's energy bill.   Also, remember that a lot of gas designated for Europe flows through Ukraine... so if Russian gas flow to Ukraine is reduced – but gas flow to Europe remains the same – Ukraine can siphon some of this off, if necessary. As a result, the heat and lights would go out in part of Europe. Then the whole thing becomes a much bigger deal, of course.

 

 One upshot of this, Kim says, is that there's an increased likelihood of more sanctions on Russia. He believes Europe won't sit around idly and let its citizens lose their gas. But there's another reason why the crisis could escalate...

 

Second... the recent provocations in cities in eastern Ukraine seem to be Putin laying the groundwork for Crimea part deux. Remember... Putin can't let Ukraine's late May elections happen. One, that will show Russians that a democratic revolution can succeed, which is something Putin definitely does not want his own people to believe.   And keeping Ukraine within the Russian/post-Soviet sphere of influence is a do-or-die proposition for Russia. This isn't just blowing over. Russia's interests are clear. It won't rest without making life miserable for Ukraine. So there's plenty of uncertainty – and downside – to come.

 

Great Minds Wanted, Wicked Pens Adored   Stansberry & Associates Investment Research is hiring an assistant editor for the S&A Digest and S&A Digest Premium. We're looking for someone with an eye for quality content and a passion for finance.   This is an opportunity to communicate daily with one of the largest lists of financial readers in the world. And you'll work closely with the Digest editors – Porter Stansberry and Sean Goldsmith.   The ideal candidate is a voracious consumer of financial news and analysis, has a keen mind, lives and breathes the world's markets, and writes great stories. Formal experience is preferred, but may not matter, depending on the candidate.   If you've ever wanted to make a living reading, writing, and thinking, please send us:   • A writing sample. Tell us about an investment opportunity. We're interested in the fundamentals of your best idea, not something that's based solely on charts. Macro ideas are welcome.   • A basic resume. Tell us what you've done before. We admire people who aren't afraid of hard work or odd jobs.   • Your income requirements. While we prefer candidates who are willing to work for free, we expect to pay handsomely for qualified employees.   No other information is necessary. Send via e-mail – with the subject line "Digest Editor" – to: stansberryresume@gmail.com.

 

 

 New 52-week highs (as of 4/8/14): Brookfield Asset Management (BAM), Dorchester Minerals (DMLP), Enterprise Products Partners (EPD), Intel (INTC), ProShares Ultra Utilities Fund (UPW), United States Commodity Index Fund (USCI), and Utilities Select Sector SPDR Fund (XLU).

 

 A bit of praise from a subscriber in today's mailbag. Send your e-mails – good or bad – to feedback@stansberryresearch.com.

 

 "I am a bit envious that you got to sit with one of the greats in the oil business. I remember when Mesa Petroleum was hot stuff. Without a doubt he is one of the greats. It would be like hanging out with those that are the greatest in their various industries. You have so many questions for people like that. One of the biggest is 'Why did you end up being one of the best.' But then again Porter you happen to be one of those people...

 

"I consider myself fortunate to be in that world. Back when I wanted to be an investor for a living I admired so many of the greats. I am sure you have thought the very same thing. The best thing for me is that I have become involved with some of the best around because they have made such a huge effort to teach me to be a success in a way that I never expected. All of you make such a huge effort to teach your readers to be successful in the investment industry.

 

"All of the time that I spend reading and learning is a great investment of my time. My wife has been impressed with my success because I make money instead of losing it. But the things that I have learned are what have made me a success.

 

"Thanks to your long term insight Porter. Thanks to Doc for his great picks that are safe. Thanks to Dan for WDDG. Thanks to Jeff for teaching me about all of the various charts and how to use them to my advantage. Porter, you have put together a team that can make anyone willing to sit and read and take the time to learn a financial success. What you have done for me is greatly appreciated and respected." – Paid-up subscriber Jeff Spranger

 

Goldsmith comment: Thanks for the kind words, Jeff. In case you missed it, Porter recently interviewed billionaire Texas oilman T. Boone Pickens on his Stansberry Radio podcast.

 

Pickens is, without a doubt, the highest-profile guest we've had the honor to speak with for the show. (You can listen to the episode for free by clicking here.)

 

But that was just the beginning of the relationship... Pickens is joining us for our second Stansberry Society conference on May 31 in Dallas. He was an early proponent of helping America gain energy independence using the massive amount of oil and gas we're producing from domestic shale. Pickens spent a personal fortune to alert Americans to the giant opportunity we had thanks to this discovery. And he's going to give a speech on the topic in Dallas.

 

And Pickens isn't our only impressive guest... You'll also hear from Texas wildcatter Cactus Schroeder, famed natural-resource investor Rick Rule, and mining geologist Brent Cook. We're still offering a few seats at special rates for the Dallas event. You can reserve your space by clicking here.

 

Regards,

 

Sean Goldsmith

New York, New York

April 9, 2014

 

Porter challenges T. Boone Pickens on 'Peak Oil'...

 

In today's Digest Premium, Porter and legendary oilman T. Boone Pickens discuss the hotly debated topic of Peak Oil.

 

Plus, find out why Pickens tells Porter, "You were right and I was wrong"...

 

To subscribe to Digest Premium and receive a free hardback copy of Jim Rogers' latest book, click here.

Editor's note: Today's Digest Premium is excerpted from episode 145 of Stansberry Radio. In it, Porter discussed the hotly debated topic of Peak Oil with legendary oil billionaire T. Boone Pickens. Find out why Pickens tells Porter, "You were right and I was wrong"...

 

 

Porter: So T. Boone, listen, I have been dying to ask you this question for a long time.

 

Back in the 2000s, when the Peak Oil theory was all the rage, I was a writer who came at that problem from the point of view of a more traditional economist. And I didn't believe in peak oil because I thought that the markets would find a way to provide a solution.

 

I wasn't sure what the solution would be, but I was confident that rising prices would lead to some kind of innovation and some kind of a solution, whether it was a replacement power source or a revolution in drilling and discovery. And we've sort of seen both happen.

 

T. Boone Pickens: Well, you were right and I was wrong.

 

Porter: Well, that's not the point of the question, really. I just wanted to ask, how did your view on that evolve? Because I know you have said more recently that you don't really see peak oil as being a problem anymore.

 

T. Boone: No. Because I mean, back 10 years ago – the United States had peaked in 1970 at 10 million barrels a day. And we were in decline from that point up until the horizontal drilling and the multiple fracks and the horizontal hole came into being. And really, that was kind of kicked off by the Barnett Shale. And that was about nine, 10 years ago. And I didn't realize that you could – that we were ever going to be able to get the oil and gas out of the source rock.

 

Now as a geologist, I knew what source rock was, but I thought all the heat and pressure that had been applied to it over the hundreds of millions of years had squeezed it into the conventional reservoirs of sand, silt, stone, dolomites, and all. And those are trapped in anticlinal features. You know, domes are where you found those.

 

And man, listen, I'd been at it a long time. I got out of school in 1951 as a geologist, practiced geology my whole life, and the fields were getting smaller and smaller is what was happening. And I could see that happening around the world. I mean, billion-barrel oilfields were not uncommon 30 years ago. But they'd got down, and you were getting one of those a year. And then along came horizontal drilling and fracking.

 

And fracking has been around forever. I saw my first frack job in 1952 in Barter, Texas. And so don't believe the President when he says fracking was developed by the Department of Energy 30 years ago.

 

 

Editor's note: If you'd like the chance to meet T. Boone Pickens in person – and hear him discuss how the ongoing shale boom can save the U.S. – I hope you'll join us in Dallas on May 31 for our second Stansberry Society Meeting. We're still offering tickets at a discount... But the offer won't last long. You can reserve your seat by clicking here.

Porter challenges T. Boone Pickens on 'Peak Oil'...

 

In today's Digest Premium, Porter and legendary oilman T. Boone Pickens discuss the hotly debated topic of Peak Oil.

 

Plus, find out why Pickens tells Porter, "You were right and I was wrong"...

 

To continue reading, scroll down or click here.

 

Stansberry & Associates Top 10 Open Recommendations
(Top 10 highest-returning open positions across all S&A portfolios)

 

 

As of 04/08/2014

 

 

Stock	Symbol	Buy Date	Return	Publication	Editor
Prestige Brands	PBH	05/13/09	329.7%	Extreme Value	Ferris
Constellation Brands	STZ	06/02/11	283.6%	Extreme Value	Ferris
Enterprise	EPD	10/15/08	283.3%	The 12% Letter	Dyson
Ultra Health Care	RXL	03/17/11	221.2%	True Wealth	Sjuggerud
Altria	MO	11/19/08	182.4%	The 12% Letter	Dyson
Ultra Health Care	RXL	01/04/12	180.6%	True Wealth Sys	Sjuggerud
McDonald's	MCD	11/28/06	177.4%	The 12% Letter	Dyson
Hershey	HSY	12/06/07	172.8%	SIA	Stansberry
Penn Virginia	PVA	10/01/13	145.2%	S&A Resource Rpt	Badiali
Automatic Data Proc	ADP	10/09/08	141.3%	Extreme Value	Ferris

Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any S&A publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio.

 

 

 

 

Top 10 Totals

3	Extreme Value	Ferris
3	The 12% Letter	Dyson
1	True Wealth	Sjuggerud
1	True Wealth Sys	Sjuggerud
1	SIA	Stansberry
1	S&A Resource Rpt	Badiali

 

Stansberry & Associates Hall of Fame
(Top 10 all-time, highest-returning closed positions across all S&A portfolios)

 

 

Investment

Sym

Holding Period

Gain

Publication

Editor

Seabridge Gold	SA	4 years, 73 days	995%	Sjug Conf.	Sjuggerud
Rite Aid 8.5% bond		4 years, 356 days	773%	True Income	Williams
ATAC Resources	ATC	313 days	597%	Phase 1	Badiali
JDS Uniphase	JDSU	1 year, 266 days	592%	SIA	Stansberry
Silver Wheaton	SLW	1 year, 185 days	345%	Resource Rpt	Badiali
Jinshan Gold Mines	JIN	290 days	339%	Resource Rpt	Badiali
Medis Tech	MDTL	4 years, 110 days	333%	Diligence	Ferris
ID Biomedical	IDBE	5 years, 38 days	331%	Diligence	Lashmet
Northern Dynasty	NAK	1 year, 343 days	322%	Resource Rpt	Badiali
Texas Instr.	TXN	270 days	301%	SIA	Stansberry