Starbucks Corp. (SBUX) is the world's leading roaster, marketer, and retailer of specialty coffee and has operations in more than 60 countries. The biggest coffee chain in the world traces its roots to Seattle, Washington, where the first location was opened in 1971. Starbucks owns and operates 53% of its about 17,000 retail store locations and licenses the rest. About 35% of Starbucks locations are outside of North America. The company also sells coffee products through food service channels and supermarkets.

SBUX has three main operating segments: Americas; Europe, Middle East, and Africa ("EMEA"); and China / Asia Pacific ("CAP").

Why We Like Starbucks

We like SBUX for the following reasons:

1. EPS and revenue growth
2. Strong domestic business
3. Coffee deflation and improving margins
4. Strong balance sheet
5. Potential dividend increases
6. Early days of growth in China
7. Incremental growth from India and other emerging markets
8. Strong quarterly earnings

EPS and Revenue Growth

Agrium, Inc. (AGU) is a retail supplier of agricultural products and services in North America, South America, and Australia. It produces and markets agricultural nutrients and industrial products with exposure to potash, phosphate, and nitrogen. The company produces and markets agriculture products to both wholesale and retail customers.

The company has three main reporting segments: retail, wholesale, and advanced technologies. The retail segment accounted for 69% of Agrium's 2012 total sales, whereas 28% of the remaining 31% was contributed by the wholesale segment. The crop protection products and crop nutrients provide the majority of revenue in the retail segment, whereas nitrogen accounts for the majority of wholesale segment revenue.

Investment Case

We have a buy rating on Agrium. We believe AGU offers diversification through its production of the three major nutrients and will benefit, in particular, from its high leverage to nitrogen fertilizer sales. The company's retail segment provides a

Goldcorp Inc. (GG) is one of the few senior gold producers, which is looking at a production growth year-over-over and in the next five years is expected to grow production by 70%. The company scores high on all four important factors for gold companies including growth profile, cash flow generation, political risk profile, and asset quality. We have a buy rating on GG.

Canada's second largest gold producer reported better than expected 4Q and complete year 2012 results. The drop in quarterly profit was lower-than-expected as the improved performance at two key mines positioned GG for a strong year.

The Canadian gold miner, which last month increased development costs at growth projects and reduced its 2013 production forecast, said 4Q12 production benefited from a strong performance at its Penasquito gold mine in Mexico and its Red Lake gold mine in Canada. Both mines had struggled with operational issues earlier

Last week, General Electric (GE) announced that it will sell its remaining 49% equity stake in the NBCUniversal ("NBCU") joint venture to Comcast (CMCSA) for $16.7 billion. Additionally, GE Capital ("GECC") will sell NBCU-owned property to Comcast for $1.4 billion cash, bringing the total purchase price to $18.1 billion. GE will receive $13.4 billion cash, $4 billion in Comcast guaranteed debt, and $0.7 billion of preferred stock as payment. The transaction is expected to close in late March and has been approved by the boards of directors of both companies.

The sale of the remaining stake in NBCU ahead of schedule is a key step in the simplification process and accelerates the timeline for exiting non-core business, reinvesting in the core, and returning cash to shareholders. GE now plans to return $18 billion cash to shareholders in 2013, 50% more than the previously announced $12 billion, with the majority

Kinross Gold Corporation (KGC) is one of our favorite gold stocks, largely due to the huge potential value we see in company's flagship Tasiast project. Since we last wrote an article on KGC, the company reported its fourth quarter and full-year 2012 production results. With the uncertainty now removed over the choice of the ton per day mill option (30,000 chosen over 60,000) and the overhang removed from an imminent write-down, the focus now shifts to the future and there is more clarity about it.

Kinross reported a strong operating quarter, driven by higher production and lower-than-expected costs. After adjusting for $3.2 billion in impairment charges, KGC reported 4Q12 adjusted EPS of $0.24, beating consensus estimates of $0.22 by 9% and 4Q11 actual EPS of $0.16 by 50%. The Canadian gold miner took a $3.2 billion after-tax, non-cash impairment charge related to Tasiast in Mauritania and the

United States Steel Corporation (X) is one of the largest steel producers in the world and the largest integrated steel producer headquartered in North America. The company has three main reporting segments Flat-rolled Products, U.S. Steel Europe, and Tubular Products. In addition to the steelmaking assets, the company has iron ore and coke production facilities, rail and barge transportation operations, real estate and engineering and consulting services.

Although X is benefiting from a strong domestic demand from the auto sector, the company's high margin tubular segment remains challenged and will more than offset any benefit from a recovery in steel demand during 2013.

Auto Demand - The Positive

2013 SAAR is expected to be 15.5 to 16 million units, a significant increase from its 2012 estimated total of 14.5 million units. X has a considerable exposure to auto market and is expected to benefit from the increasing demand

Silver Wheaton Corporation (SLW), the largest precious metal streaming company in the World, announced a binding term sheet to acquire two gold streams from Vale S.A. (VALE), the Salobo Mine in Brazil and certain Sudbury Mines in Canada for total consideration of $1.9 billion in cash plus 10 million SLW warrants with a strike price of $65 and a term of 10 years. Under the terms of the deal, Vale will deliver 25% gold stream interest of the life of mine production from company's Salobo Mine and a 70% gold stream interest from certain of its Sudbury Mines for a 20-year term.

Gold, Strategically A Good Opportunity; However, Focus Remains On Silver

Seen as a pure play on silver, the move should not be seen as company refocusing its metal priorities. "This isn't a change in focus for us. We've always been interested in broader precious metals so I

Steel companies still continue to operate in a difficult environment; however, there still are companies which managed their business well during the last two years and are well positioned to benefit from improving steel demand. Nucor (NUE) and Steel Dynamics (STLD) are two such companies. Both companies are levered significantly to end-markets which are showing continuous signs of improvements.

Nucor reported 4Q12 EPS of $0.45, beating consensus estimates of $0.31 by more than 45%. The results also came in better than NUE's mid-December guidance of $0.25-$0.30 per share. The beat was largely due to better than expected operating profits, primarily at its sheet, plate and beam mills, and a larger than expected last-in, first-out credit.

Similar to Nucor, Steel dynamics reported better than expected 4Q12 results. STLD reported operating EPS of $0.20, beating consensus estimates of $0.14 by 43%. Steel operations, which delivered stronger than expected volumes and lower than

This article discusses three high-yield agricultural chemical stocks. All three companies mainly deal in nitrogen fertilizer products. Although CVR Partners' (UAN) cash distribution took a dip recently due to a planned plant turnaround, it still offers a high dividend yield and the company is looking at a significant double-digit increase in cash distribution in 2013. Both Terra Nitrogen (TNH) and Rentech Nitrogen (RNF) have higher than 6.5% dividend yield.

CVR Partners L.P.

CVR Partners engages in the production, distribution, and marketing of nitrogen fertilizers in North America. Its nitrogen fertilizer products include ammonia and urea ammonium nitrate.

The company pays quarterly dividend and recently announced a fourth quarter dividend of 19.2 cents per common unit. UAN has a forward dividend yield of 2.6%. The scheduled plant turnaround in October significantly impacted fourth quarter cash available for distribution, still the total dividend paid for the year 2012 of

Freeport-McMoRan Copper & Gold (FCX) saw its shares increase yesterday as fourth quarter profits and revenues beat estimates. The company said that it expects to grow copper production from 3.66 billion pounds in 2012 to over 5 billion pounds per year in 2015.

The world's largest publicly listed copper producer announced last month that it would enter the energy business through acquisitions of Plains Exploration & Production Co (PXP) and McMoRan Exploration Co (MMR). The $9 billion deal has garnered much media attention since its announcement and has been criticized by investors as an expensive and unnecessary distraction. The company reiterated that it will not give its shareholders a vote on its planned acquisitions of two oil and natural gas companies. The deals are expected to close in the second quarter of 2013.

FCX reported headline EPS of $0.78 and adjusted EPS $0.74 for 4Q12, beating consensus estimates of

Steel Dynamics (STLD) has plenty of things going in its favor. It's one of the best managed steel companies in the United States; it has a low, highly variable cost structure, which has helped it post superior margins throughout the last two challenging years for the steel markers. It has a diversified product mix, a secure supply of recycled ferrous metals, and an experienced senior management team.

Steel dynamics has one of the lowest operating cost structures in the North American steel industry. The company's low operating costs are driven by high labor efficiency as well as a transportation cost advantage in the upper Midwest.

STLD is also well positioned to benefit from improving steel demand, with end-markets including construction, automotive, machinery all showing signs of improvement. For dividend seeking investors STLD also has a very attractive dividend yield of 2.6%.

The Company

Steel Dynamics was co-founded in 1993

Citi (C) reported 4Q12 GAAP EPS of $0.38. Excluding $1.0 billion in severance costs ($0.21 per share) and DVA loss of $485 million ($0.10 per share), operating EPS of $0.69 was still less than the consensus estimates of $0.96. This is Citi's first miss in the last four quarters.

(click to enlarge)

Source: Yahoo Finance

Despite improving credit metrics Citi has yet to release mortgage reserves, citing continued political and macro uncertainty. However, the three consecutive quarters of improvements in home prices and continued declines in the unemployment rate seem to counter this conservative argument. We expect mortgage reserves releases to occur in 2013 as pressure mounts on Citi.

Excluding CVA/DVA and minority investments, consolidated revenues declined 4% sequentially but increased 8% Y/Y to $18.7 billion. Citicorp's revenues declined 4% to $17.6 billion, while Citi Holdings' revenues of $1.0 billion showed an

Goldcorp Inc. (GG) is a senior Canadian gold producer engaged in the operation, exploration, development and acquisition of precious metal properties in Canada, the United States, Mexico and Central and South America. The company has five mines in Canada and the U.S., three mines in Mexico, and three mines in Central and South America. Other than gold, the Vancouver based company also produces and sells copper, silver, lead, and zinc.

Why We Like Goldcorp

We like this Canadian gold miner for the following reasons:

1. Strong pipeline of growth projects
2. Significant near-term cash flow generation
3. Operations in safe jurisdictions
4. Strong balance sheet
5. Investment grade credit rating
6. High quality, low cost assets

GG is one of the few senior gold producers that can deliver strong growth over the next few years. The large Pueblo Viejo mine in the Dominican Republic started commercial production in December 2012, and will generate significant cash flows

Alcoa Inc. (AA) reported 4Q12 adjusted EPS from continuing operations of $0.06, in line with the consensus estimates of $0.06. The headline EPS of $0.21 was adjusted for several non-recurring items including gains from the sale of the Tapoco Hydroelectric Project, discrete tax items, and other special items net of restructuring charges. The adjusted EPS of $0.06 increased 100% sequentially from 3Q12 EPS of $0.03. Adjusted EBITDA of $597 million was slightly above the consensus estimates of $585 million and up from 4Q11 EBITDA of $445 million and 3Q12 EBITDA of $496 million.

Segment results

Alumina Benefits from Higher Pricing

Alumina segment reported 4Q12 after-tax operating income (ATOI) of $41 million up from 3Q12 ATOI of -$9 million. However ATOI for the segment declined by $84 million Y/Y, representing a decline of more than 67%. Production for the segment was essentially flat Q/Q at 4079kmt; however, third party

Potash Corporation of Saskatchewan (POT) is the largest and one of the lowest cost potash producers in the world. The potash segment provided 46% of the company's revenue last year, followed by phosphate (28%) and nitrogen (26%). However, profitability is largely driven by potash sales; the segment contributed 64% of the total company's gross profit in 2011, followed by nitrogen (21%), and phosphates (13%). The company's profitability is highly levered to potash prices and market outlook for the nutrient.

Source: Company Documents

Market Update

After a long delay, China finally settled a potash contract last week with Canpotex, the major Canadian potash export consortium representing POT, Mosaic (MOS) and Agrium (AGU). Canpotex signed a six month (1H13) supply agreement with Chinese distributor Sinofert for 1 million tons of potash at a price of $400 per ton, a reduction of $70 from the last year's contract

The Mosaic Company's (MOS) stock is up 3.3% since we last wrote a report on it. MOS released its 2Q FY13 earnings on Friday. The company reported 2Q adjusted earnings of $1.05 per share, beating consensus estimates of $0.93 by ~13%. The EPS was adjusted for one-time items including $179 million ($0.42 per share) gain from a tax benefit adjustment. Stronger than expected North American shipments drove the beat, partially offset by lower phosphate profitability.

The company reported 2Q FY13 EBITDA of $707 million, beating consensus estimates of $668 million by 6%. Mosaic's CFO declined Y/Y to $322 million from $518 million a year ago; however, the net cash remains strong at $2.4 billion.

Post 2Q results, the company's liquidity position remains strong, it should continue to fund expansion projects and enable MOS to return significant cash flow to shareholders, via share buybacks, once Cargill restrictions expire in

Ford Motor Co. (F) yesterday reported better than expected and its best December sales since 2006. On an unadjusted basis, the automaker's sales increased by 1.9% YoY, above the consensus estimates of 1.2%. On a selling-day adjusted basis, December sales increased 5.9% year over year (YoY), again above consensus estimates of 5%.

Car sales increased 27.5% YoY, while truck sales were down YoY. By brand, Ford vehicle sales increased 6.4% YoY, while Lincoln sales declined by 8.7%. For the 31st straight year F-Series was the best-selling vehicle in the United States; however, the increase in sales was very modest (0.7%).

With annual sales of 645,316, the F-Series remained the best-selling vehicle in the country, followed by the full-size Chevrolet Silverado pickup, at 418,312.

Inventory increased to 522,000 units at the end of December, up from 517,000 units at the end of November. Sales were impacted by the recall program for

General Motors (GM) yesterday reported its best U.S. December sales figures in 5 years. The Detroit based automaker reported a YoY increase in sales of 4.9%, compared to the consensus estimates of 2.1%. On an adjusted basis, sales increased 8.9% YoY, above consensus estimates of 6.7%.

Compared to 234,351 units a year ago, GM delivered 245,733 cars and trucks in December (26 selling days vs. 27 in December 2011). The automaker closed the year with total GM sales of 2.6 million in its home market, an increase of 3.7% YoY.

All brands made sales gains from a year ago. Chevrolet sales increased 7.7% to 167,091 units. Cruze compact car sales jumped 32.2% to 21,230 units. Buick enclave had another outstanding month; the vehicle saw deliveries increase 13.1% to 6052 units as customers sought the recently launched redesigned model. Total Buick sales rose 14.2% to 16,473 units. Cadillac sales

Potash prices remained weak during the second half of 2012, largely due to the contract delays with India and China. International buyers also stalled their purchases in the hopes of procuring lower prices in the future. Despite the poor international demand, North American demand remained high during the period. However, 2013 starts with much uncertainty removed as China has now settled contracts for 1H13 and India is expected to follow in the near term. There are a couple of agriculture stocks which we think will outperform in 2013. Today we will focus on The Mosaic Company (MOS).

The Mosaic Company

Mosaic is the world's largest integrated phosphate producer and one of the largest producers of phosphate-based animal feed ingredients in the United States. MOS is also the third largest producer of Potash by capacity in the world. The company sells phosphate and potash to over 40 countries in

Cisco Systems Inc. (CSCO)

Cisco Systems, Inc. is the world's largest provider of communications equipment for service providers, enterprises, small/medium-sized businesses, and consumers worldwide. Across both service providers and enterprises, it has a dominant share in switches and routers. Switches provided for 32% of FY2012 total revenue and NGN Routing 18%.

Cisco is the overall leader in IP/Ethernet communications infrastructure, having significantly above-average operating profitability versus its industry peers. The collaboration segment consists primarily of tele-presence video conferencing solution and the web-based collaborative offerings (WebEx). The wireless segment provides wireless access points and associated equipment for enterprises. The security segment provides remote access, firewall, VPNs, intrusion prevention, web and email security and network security to enterprises and service providers.

The service segment provides technical support services, such as warranty and maintenance, and advanced services provide consulting and planning services. Breaking down the revenue by product and services, products provided for