Will Time Warner Cable Continue Its Surge Higher With Recent News?

With shares of Time Warner Cable (NYSE:TWC) trading around $132, is TWC an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

T = Trends for a Stock’s Movement

Time Warner Cable is a provider of video, high-speed data, and voice services in the United States, with systems located in five geographic areas: New York, the Carolinas, Ohio, Southern California, and Texas. The company offers its residential and business services customers numerous services over its broadband cable systems. With such a large and growing user base, look for Time Warner Cable to continue to see rising profits from its media, entertainment, and communications offerings.

Time Warner Cable should start preparing itself to hear a bid from Charter Communications (NASDAQ:CHTR). According to a Wall Street Journal report citing people familiar with the matter, Charter is preparing loans to finance a cash and stock bid for Time Warner that has been rumored about for a while. Charter, which is backed by Liberty Global's (NASDAQ:LBTYA) John Malone, wants to merge with Time Warner, as Malone believes that consolidation in the pay-TV industry is necessary for the service's survival.

T = Technicals on the Stock Chart Are Strong

Time Warner Cable stock has seen a consistent uptrend in the last few years. The stock is currently surging higher trading near highs for the year. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Time Warner Cable is trading above its rising key averages, which signal neutral to bullish price action in the near-term.

(Source: Thinkorswim)

Taking a look at the implied volatility (red) and implied volatility skew levels of Time Warner Cable options may help determine if investors are bullish, neutral, or bearish.

	Implied Volatility (IV)	30-Day IV Percentile	90-Day IV Percentile
Time Warner Cable Options	27.32%	0%	0%

What does this mean? This means that investors or traders are buying a very small amount of call and put options contracts as compared to the last 30 and 90 trading days.

	Put IV Skew	Call IV Skew
December Options	Flat	Average
January Options	Flat	Average

As of today, there is an average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a very small amount of call and put option contracts and are leaning neutral to bullish over the next two months.

On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.

E = Earnings Are Increasing Quarter-Over-Quarter

Rising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Time Warner Cable’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Time Warner Cable look like and more importantly, how did the markets like these numbers?

	2013 Q3	2013 Q2	2013 Q1	2012 Q4
Earnings Growth (Y-O-Y)	-29.23%	14.69%	11.67%	-3.74%
Revenue Growth (Y-O-Y)	2.89%	2.70%	6.64%	9.85%
Earnings Reaction	2.79%	3.16%	-0.58%	-11.28%

Time Warner Cable has seen mixed earnings and increasing revenue figures over the last four quarters. From these numbers, the markets have been pleased with Time Warner Cable’s recent earnings announcements.

P = Excellent Relative Performance Versus Peers and Sector

How has Time Warner Cable stock done relative to its peers, Comcast (NASDAQ:CMCSA), Dish Network (NASDAQ:DISH), DirecTV (NASDAQ:DTV), and sector?

	Time Warner Cable	Comcast	Dish Network	DirecTV	Sector
Year-to-Date Return	34.20%	31.13%	41.81%	27.25%	34.59%

Time Warner Cable has been a relative performance leader, year-to-date.

Conclusion

Time Warner Cable provides entertainment, voice, and high-speed data services to a growing customer base in the United States. The company is preparing itself to hear a bid from Charter Communications. The stock has seen a consistent uptrend in the last few years and is currently surging higher. Over the last four quarters, earnings have been mixed while revenues have been rising which has left investors happy about recent earnings announcements. Relative to its peers and sector, Time Warner Cable has been a relative year-to-date performance leader. Look for Time Warner Cable to OUTPERFORM.

U.S. stock market nears milestone heaven

NEW YORK — The stock market, which has been melting up most of this record-breaking year, is on the cusp of achieving a troika of major milestones.

Dow 16,000 is within easy reach for the first time. The Standard & Poor's 500 is fast approaching 1800. And the Nasdaq composite is nearing 4000 for the first time since the dot-com bubble burst in 2000.

Whether those psychologically potent numbers are a sign of a healthy bull market — or indicate a stock market bubble — is a matter of opinion.

"Up is a beautiful thing," says Bob Doll, chief equity strategist at Nuveen Asset Management. "Big round numbers don't ... scare me."

But milestones do attract the attention of investors, including many who might feel pressured to get in the market after missing out on the gains because they've been on the sidelines.

"Dow 16,000 will grab headlines," says Alan Skrainka, chief investment officer at Cornerstone Wealth Management, adding that chasing returns in an undisciplined way is a "bad idea."

Keeping up with the market has been tough. The S&P 500 is up 26.1% in 2013 and notched 36 record closes as of Friday, the most since 1998, according to S&P Dow Jones Indices.

Doll says the path of least resistance for stocks is up, citing continued improvement in the U.S. and global economies.

Optimists say the Federal Reserve's investor-friendly bond-buying program, which stimulates the economy by keeping borrowing costs low, is likely to continue under Janet Yellen if she replaces Fed Chairman Ben Bernanke — as expected. "I don't think you can deny there's a 'Yellen Effect,' " says Chris Bouffard, chief investment officer of the Mutual Fund Research Center.

The S&P 500 is trading at 16 times its earnings over the past four quarters, putting valuations in line with historical averages. "The market," says Ed Yardeni, chief investment strategist at Yardeni Research, "is not cheap. But it's not overvalued."

Still, a growing crowd warns that the ! stock market is getting ahead of itself.

Richard Suttmeier, chief market strategist at ValuEngine.com, says the Fed's easy-money policies, which received an endorsement from Yellen at her confirmation hearing Thursday, are creating the conditions for a dangerously frothy market. The Fed's $85 billion in monthly bond purchases is inflating asset prices, he says. "There's substantial risk for a market melt-up, which are often followed by meltdowns."

Even though optimism is rising, sentiment is not excessively bullish like it was at the past market tops, says Craig Johnson, technical market strategist at Piper Jaffray. "I was there in 2000. I was there in 2007. And it does not feel the same," he says, adding that he's sticking to his S&P 500 year-end target of 1,850 — up almost 3% from Friday.

Stock Brokers: An Endangered Species?

By Hal M. Bundrick

NEW YORK (MainStreet) Traditional brokerage firms, like Merrill Lynch and Morgan Stanley, are facing greater challenges to keep clients, and brokers, as the industry braces for a tectonic shift. These stalwarts of the business, traditionally called wire houses, are looking for ways to remain competitive as a higher code of customer care, the fiduciary standard, becomes more prevalent. As one industry observer notes, brokerage firms have discouraged their advisors to act as fiduciaries because "many are not competent enough" and doing so would expose the firm to significant liability.

"There always seem to be certain events or cycles where some experts say that wire houses will not be able to compete against RIAs (registered investment advisors) and independent advisors because of their more restrictive model," writes Fred Barstein, on NAPA Net.

"That conversation arose after the imposition of 408(b)(2), which requires advisors to disclose in writing whether or not they are acting as a fiduciary for the services they are rendering and the associated fees." Barstein is the founder and executive director of The Retirement Advisor University, and editor in chief of the National Association of Plan Advisors website. The Department of Labor as well as the Securities and Exchange Commission are working to codify the fiduciary standard. While wire house brokers serving retail customers are seldom allowed to "put the client's interests first" under the mandate of a fiduciary standard -- serving to a less-stringent "suitability standard" -- some brokerage advisors working with company-sponsored retirement plans are permitted to offer fiduciary advice. "All of the wire houses now allow a select group of their advisors to act as ERISA 3(21) fiduciaries, with certain restrictions -- they must have a minimum number of plans and assets under management; fiduciary services may be provided to larger plans only; and some type of industry designation must be completed," Barstein writes. But Barstein says not to count wire houses out just yet. Brokerage firms have the benefit of national brand recognition, deep pockets and long-term relationships. "Firms tied to a retail bank, like Merrill Lynch and Wells Fargo, have other obvious advantages, with Merrill starting to capitalize on BofA's relationships by teaming up corporate loan officers with designated plan advisors," Barstein writes. "Other firms team up advisors who may not focus on the (employer-sponsored retirement plan) market with specialists offering partnerships for larger firms or publicly traded companies. So once again, the demise of wire houses is greatly exaggerated even with new fiduciary regs looming." --Written by Hal M. Bundrick for MainStreet

Should the Big Banks Really Face Another Credit Downgrade?

The big banks have gone to considerable lengths to mend the weaknesses that they were in before, during and after the recession. The public perception of the big banks is not very highly regarded. Now the banks are apparently at risk of yet another credit rating downgrade. Late on Thursday came word out of Moody’s Investors Service that the credit ratings agency has placed the senior and subordinated debt ratings of the six largest U.S. bank holding companies on review “as it considers reducing its government (or systemic) support assumptions to reflect the impact of U.S. bank resolution policies.”

Moody’s signaled that the four on review for downgrade are Goldman Sachs Group Inc. (NYSE: GS) and Morgan Stanley (NYSE: MS), both of which are bank holding companies with no retail banking operations, as well as J.P. Morgan Chase & Co. (NYSE: JPM) and Wells Fargo & Co. (NYSE: WFC).

Where the rating changes become a wild card are in Bank of America Corp. (NYSE: BAC) and Citigroup Inc. (NYSE: C). These two were placed on “review direction uncertain” as Moody’s “considers the potentially offsetting influence of improvements in the standalone credit strength of their main operating subsidiaries, the ratings on which were simultaneously placed on review for upgrade.”

Two additional banks with ratings previously placed on review for a credit rating downgrade also were included in the review: Bank of New York Mellon Corp. (NYSE: BK) and State Street Corp. (NYSE: STT).

Moody’s said:

The ratings on the bank-level subordinated debt of JP Morgan Chase Bank N.A. and Wells Fargo Bank N.A. were placed on review for downgrade, while those at Bank of America N.A. are on review direction uncertain. The bank-level subordinated debt ratings of The Bank of New York Mellon and State Street Bank and Trust, which were previously placed on review for downgrade, are also included in the review. There is no rated bank-level subordinated debt outstanding at Citibank N.A., Goldman Sachs Bank USA or Morgan Stanley Bank N.A. … Moody’s actions follow its March 2013 announcement that it would reassess its support assumptions for bank holding companies in the US and that it would consider whether to revise these assumptions by the end of the year.

The ratings placed on review for a downgrade were as follows:

Goldman Sachs Group Inc. (A3 senior, Baa1 subordinated and Baa3 (hyb) trust preferred vehicles) J.P. Morgan Chase & Co. (A2 senior, A3 subordinated, Baa2 (hyb) trust preferred vehicles and Prime-1 short-term rating); J.P. Morgan Chase Bank N.A. (A1 subordinated) Morgan Stanley (Baa1 senior, Baa2 subordinated, Ba1 (hyb) trust preferred vehicles and Prime-2 short-term rating) Wells Fargo & Company Inc. (A2 senior, A3 subordinated, Baa1 (hyb) trust preferred vehicles and Prime-1 short-term rating); Wells Fargo Bank, N.A. (A1 subordinated and A3 (hyb) trust preferred vehicles) Bank of America Corp. (Prime-2 short-term rating) Citigroup, Inc. (Prime-2 short-term rating)

The following ratings continue to be on review for downgrade:

The Bank of New York Mellon Corp. (Aa3 senior, A1 subordinated, A2 (hyb) trust preferred vehicles and Baa1 (hyb) noncumulative preferred); The Bank of New York Mellon (B bank financial strength rating (BFSR)/aa3 baseline credit assessment (BCA), Aa1 deposits and senior and (P)Aa2 subordinated) State Street Corp. (A3 (hyb) trust preferred vehicles and Baa1 (hyb) noncumulative preferred); State Street Bank and Trust Co. (B BFSR/aa3 BCA, Aa2 deposits and senior and Aa3 subordinated)

The following ratings were placed on review for upgrade:

Bank of America, N.A. (D+ BFSR/baa3 BCA, A3/Prime-2 deposits and senior); Bank of America Corp. (B1 (hyb) noncumulative preferred) Citibank, N.A. (D+ BFSR/baa3 BCA, A3/Prime-2 deposits and senior); Citigroup Inc. (B1 (hyb) noncumulative preferred)

The following ratings were placed on review direction uncertain:

Bank of America Corp. (Baa2 senior, Baa3 subordinated and Ba2 (hyb) trust preferred vehicles); Bank of America, N.A. (Baa1 subordinated) Citigroup Inc. (Baa2 senior, Baa3 subordinated and Ba2 (hyb) trust preferred vehicles) State Street Corp. (A1 senior, A2 subordinated)

Could American Donors Be More Generous?

Americans give more to charity as a percentage of GDP than their counterparts in many other major industrial countries, but advocates would like to push this rate higher.

Giving has hovered around 2% for the past 40 years, with the occasional up or down blip, according to a recent analysis in The Chronicle of Philanthropy.

In 2012, American donors contributed some $316 billion, 2% of the country’s GDP, unchanged from the previous year, according to the annual Giving USA report.

“We’re stuck” at the 2% rate, John List, head of the University of Chicago’s Science of Philanthropy Initiative,” told The Chronicle.

“There’s a lot of money on the charity sidelines, and the charitable community needs to build a better mousetrap.”

But Paul Schervish at Boston College’s Center on Wealth and Philanthropy argued that the GDP share reflected only donations to nonprofit groups and not informal types of giving, such as contributions to political groups.

Still, advocates try to get donors to dig deeper in their pockets, according to The Chronicle. Adam Meyerson, president of the Philanthropy Roundtable, for example, proposes a “3% solution.” The extra money would provide a philanthropic alternative to failed or distressed government programs.

Others argue that wealthy people, who are already the biggest donors, have an ethical obligation to increase their giving — and can do so without materially affecting their lifestyle.

But the Chronicle analysis noted that organized initiatives to get people to be more generous have foundered. In the late 1980s and early 1990s, Independent Sector mounted an aggressive ad campaign urging Americans to increase their giving to 5% of gross income from an average of about 2%.

The campaign went nowhere. An Independent Sector employee at the time speculated that because of the personal nature of charitable donations, people didn’t like to told how much to give.

In another effort in Wisconsin, founders of the One Percent Club urged wealthy people to contribute 1% of their net assets to charity each year or 5% of their income, whichever was larger. Initially promising, with membership growing to 1,000, this effort also petered out.

A founder told The Chronicle that most contributors were already major philanthropists, so the club was “preaching to the choir.”

Some take hope in the Giving Pledge inaugurated by Warren Buffett and Bill and Melinda Gates, which encourages billionaires to give away half their fortunes.

The Philanthropy Roundtable’s Meyerson said more favorable tax treatment for charitable gifts could help push the giving rate higher. He can only hope. Tax reformers on Capitol Hill are currently taking a hard look the charitable deduction.

Meyerson also said nonprofits could do a better job of appealing to “the philanthropic imagination of the American people,” taking their cue from colleges and universities and from houses of worship that “appeal to Americans’ highest values and aspirations, not their guilt.”

And fundraising consultant Penelope Burk told The Chronicle her surveys had showed that around 10% of people said they had put bequests to charity in their wills, but more than 30% said they would do so or consider doing so if asked.

---

Check out Nonprofit Sector Reacts to ‘Worst Charities’ Exposé.

Google Introduces Upgraded Maps App

Nearly a month after its acquisition of mobile map service provider Waze, Google (NASDAQ: GOOG  ) has updated its map app for both smartphones and tablets, the company announced today.

The new, upgraded Google Maps is compatible with both smartphones and tablets running Android OS, and will soon be available for Apple's (NASDAQ: AAPL  ) iPhones and iPads. Google's December 2012 release of Maps was not compatible with iPads.

According to Google's blog, the new Maps app has several enhanced features, including one-touch browsing, enhanced navigation, and Zagat reviews of local businesses. Similar to Waze, the new Google Maps allows users to access potential road condition problems, including incident details, and suggest an alternative route, if one is available.

Google also announced that beginning Aug. 9, Google Maps Latitude, which lets users share their location, and check-in features will no longer be compatible with the upgraded Maps, and will "be retired from older versions." Google also said its offline Maps feature is no longer available.

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Should I Buy Kingfisher?

LONDON -- I'm shopping for shares right now. Should I pop Kingfisher  (LSE: KGF  ) into my basket?

Storm warning
Last time I looked at Kingfisher, it had gone into a dive. Europe's largest home-improvement retailer had suffered a summer washout, losing an estimated 30 million pounds of profits in the U.K. and northern Europe as rain-soaked customers abandoned their gardens to the elements. Pre-tax profits had dropped 17% in what chief executive Ian Cheshire called his "toughest half" since taking charge in 2008. Tax hikes in France didn't help.

The weather forecast is pretty dismal as I write this, but the sun has been shining on Kingfisher's share price. It is up 25% over the past six months, against 7.6% for the FTSE 100, capping a strong five-year return of more than 200%. Yet its first-quarter trading results were wet and windy, with like-for-like sales down 4.2%, and a near 30% drop in profits to 114 million pounds. The culprit was the same: bad weather in Europe. You weren't the only one shivering indoors during this year's icy March and April. Kingfisher's customers were also sitting tight, having decided they could DIY another day. Sales of outdoor products fell 10%. Sales and profits were down 4.7% in the U.K. and Ireland and 5.6% in France. Economic storms didn't help, either.

Russian front
Like so many FTSE 100 favorites, Kingfisher has set its eyes on distant climes. Sales in Russia grew 17.4% to 91 million pounds, while B&Q China, which has 39 stores, saw sales rise 9.1% to 77 million pounds. Kingfisher also enjoyed a decent showing in Spain, thanks to new stores, but sales in Poland froze in the cold. I am increasingly impressed by the company's global reach. DIY has conquered the West. I don't see why the East won't fall as well. But there could also be headwinds, especially if the Chinese property market is as precarious as people say.

Latest figures suggest the U.K. housing market is picking up, but with inflation outpacing wages, the British consumer is still likely to struggle, while there are few signs of meaningful recovery in France. Then there's the weather. Whatever your views on climate change, the elements have been acting strangely lately, and Kingfisher's share price is very exposed.

Live and let DIY
After the recent share price run, it looks fully valued at 15.9 times earnings, against 12.7 for the FTSE 100. The yield of 2.7% also underperforms the index average of 3.63%. Forecast earnings-per-share growth of 6% to January 2014 and 11% to 2015 looks solid enough, and I would expect Kingfisher to perform strongly when the recovery finally beds in. Who doesn't want to do up their home once they've got a bit cash to spare? Some brokers are very keen. Most blame the weather for the company's recent difficulties. Jefferies has just upped its target price from 3.30 pounds to 4 pounds, and reiterated its buy call. I might buy Kingfisher, but only after it's been raining, and the share price is a bit soggier.

Kingfisher is good, but it isn't good enough to feature in our special report "5 Shares to Retire On." This free report by Motley Fool share analysts names five FTSE 100 favorites to secure your retirement. To find out more, download this report now. It won't cost you a penny, so click here.

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Citi Settles FHFA Suit. Here's Why It's Still a Buy

U.S. stocks opened lower this morning, with the S&P 500 (SNPINDEX: ^GSPC  ) and the narrower, price-weighted Dow Jones Industrial Average (DJINDICES: ^DJI  ) down 0.47% each at 10:05 a.m. EDT.

Citi breaks with its peers
Did Citigroup (NYSE: C  ) just agree to be ransomed, or is the bank just wisely paying to move forward? Citi has broken with its peers in settling one of the last post-crisis lawsuits brought by the Federal Housing Finance Agency against 17 banks in 2011. The FHFA's claim was that the banks had mis-sold mortgage-backed securities to Fannie Mae and Freddie Mac, the government-sponsored mortgage companies that were effectively nationalized in 2008 at the height of the credit crisis.

Citi's decision looks like a smart one to me. According to the Financial Times, similar lawsuits have been settled for "cents on each dollar" of the total principal amount in question. For Citi, that principal amount is $3.5 billion, so a rough estimate of the settlement doesn't look exorbitant, particularly once you compare it to the opportunity cost of diverted management time and focus, the tangible cost of high-priced securities and litigation lawyers, and the drag these lawsuits have had on the multiple that investors have been willing to award the stock.

Admittedly, investors have already rerated the shares, which finished last year at a price-to-tangible-book-value multiple of 0.75. As of yesterday's close, the stock was poised to trade at or above its tangible book value for the first time since the second quarter of 2011, with a multiple of 0.99. That increase has enabled Citi shares to outperform those of its two nearest peers and the S&P 500 year to date:

C Total Return Price data by YCharts.

How far does the stock have to run? In an interview published in Barron's on May 18, legendary value investor Leon Cooperman outlined his thesis for the stock:

One of our holdings is Citigroup, which trades at around $50, or roughly 0.9 times tangible book value. We believe the new management at Citi can more than double its return on tangible equity in the next two to three years by reducing the drag from the runoff of the Citi Holdings entity, which consists of businesses and portfolios that the company is exiting.

The installation of Michael Corbat as CEO, along with Michael O'Neill as chairman, was an important inflection point. O'Neill has proved that he can turn around franchises, most recently at Bank of Hawaii after the dot-com bubble burst. Citi can earn at least $5 a share this year, versus a consensus of $4.70, primarily through cost-cutting and reducing losses at Citi Holdings. By the end of 2014, through a combination of cost-cutting, buybacks, noncore-asset sales, and winding down runoff entities, Citi can be a $70 stock.

In a roaring bull market that offers fewer and fewer bargains, Citi still looks reasonably priced. The bank, long discarded by investors as a basket case, could continue to regain favor as investors become more familiar with its turnaround.

Is B of A a buy?
Bank of America's stock doubled in 2012. Is there more yet to come? With significant challenges still ahead, it's critical to have a solid understanding of this megabank before adding it to your portfolio. In The Motley Fool's premium research report on B of A, analyst Anand Chokkavelu, CFA, and financials bureau chief Matt Koppenheffer lift the veil on the bank's operations, detailing three reasons to buy and three reasons to sell. Click here now to claim your copy.

GM's Cadillac Is Finally Gaining Ground

General Motors' (NYSE: GM  ) push to revive its old luxury brand, Cadillac, first started a decade ago. But it picked up momentum when CEO Dan Akerson started looking to turn the old cushy-car maker into a serious global luxury contender.

Cadillac's U.S. sales have finally started to pick up. In this video, Fool contributor John Rosevear looks at what's driving the Cadillac resurgence -- and at how far it still has to go to catch its big-name rivals.

The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in the brand-new free report: "The Motley Fool's Top Stock for 2013." Just click here to access the report and find out the name of this under-the-radar company.

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5 Smart Questions Young Adults Are Asking to Super-Charge Their Retirement Savings

So you've started saving for retirement. Now what?

We've showed you how much saving early and often can net you later, and many young adults are following our advice. According to a recent Transamerica survey, 70% of millennials are already saving for retirement and those who are participating in a 401(k) or similar plan contribute, on average, 8% of their annual salary.

We were beaming like proud parents when we saw how many Starting Out-ers joined our latest Jump-Start Your Retirement Plan online chat to learn how to save even more—and do so in tax-advantageous ways. You asked smart questions about various savings options and showed interest in other topics such as student loans and home buying.

In case you missed the chat (don't worry, there will be another later in the year), we rounded up (and lightly edited) some of the best queries from young adults like you. Read on to see what advice professionals from the National Association of Personal Financial Advisors offered. Maybe their answers can help you on your path to retirement, too.

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(For all of this month's expert retirement advice, check out the chat transcript.)

Traditional vs. Roth IRAs

Q: I'm 25 years old and get no 401(k) match from my employer. I'm curious about holding both a traditional and a Roth IRA. Is it a good idea to spread the tax liability around and secure some withdrawal flexibility for the future? What would be the major downside?

A: Roth IRAs are fantastic. At 25, hopefully you have a lifetime of paying higher employment taxes ahead of you, so it often makes the most sense to look at paying taxes today and never in the future with Roth accounts. I also think if you are comfortable managing your money with or without an adviser, then my preference is control over your available investments, in which case a Roth or traditional IRA—as opposed to a 401(k)—gives you the most control to choose where and how you invest. – Robert Schmansky, Clear Financial Advisors, Livonia, Mich.

MORE FROM KIPLINGER: Why You Need a Roth IRA Other investment account options

Q: I do not have access to a 401(k) through my employer, and I have maxed out my Roth IRA last year and this year. Without a 401(k), what are my other options for saving for retirement? Fully funding a Roth IRA alone will never be enough! I'm 30 years old and recently (2013) finished grad school, so I'm starting saving late as it is.

A: I would encourage you to save in a taxable account for now in addition to your Roth IRA. You can add to a taxable account any and all that you'd like (no limits). You are taxed as you go on any realized gains (when you sell and on dividends), and those are taxed at a capital gains rate, which is lower than an income rate. If you have realized losses (when you sell), you can take up to $3,000 of them annually on your return. If you have more than that in a year, you can carry forward the loss over $3,000 to use on your next return. – Bonnie Sewell, American Capital Planning, Leesburg, Va. and Miami, Fla.

MORE FROM KIPLINGER: Where to Save After Your 401(k) Saving for a home vs. saving for retirement

Q: I'm 24 years old. Since I plan on buying a home in a couple years, should I sacrifice saving for retirement (fortunate enough that my company does make contributions for me) until I sock away enough money to make a nice down payment?

A: It's great that your company socks away money for you. Could you save for both a down payment and retirement? The compounding effect on your retirement savings would be enormous for someone in his or her twenties. How about saving 3% or 4% for retirement and putting the rest away for a down payment? – Frank Boucher, Boucher Financial Planning Services, Reston, Va.

MORE FROM KIPLINGER: How to Stretch Your Money Paying off student loans vs. saving for retirement

Q: I am 36 and have a lot of student loan debt. Will having this much debt prevent me from saving as much as I need for retirement, buying a home or just in general? (Also, I work at a nonprofit and am eligible for loan forgiveness after ten years of prompt payment.)

A: That is a question I see many struggle with. I would encourage you to try to both save for the long-term and make payments at the same time. At the very least, if you have a match from an employer retirement plan, I'd like you to get that. Try to have 20% of your income go toward financial priorities, including paying down debt and saving. If it's a struggle to save much with that, then try to look at the income-based [loan repayment] plans. You can perhaps lower your payment below the ten-year schedule with these options, which are meant to help if your payment is too much for your budget. (However, certain plans, such as extended repayment, will not be qualified for forgiveness.) - Robert Schmansky, Clear Financial Advisors, Livonia, Mich.

MORE FROM KIPLINGER: Don't Stress Over Student Loans Mutual funds for young investors

Q: I am 27 years old. I currently have a Roth that I opened a couple of years ago, but I am not sure I am investing in the appropriate funds for my age. I am curious if there are any recommended funds that focus on long-term growth I can look into?

A: You want to maintain a diversified portfolio. A simple way to do this is to use a Vanguard Target Retirement Fund. For instance the Vanguard Target Retirement 2050 fund (VFIFX) has just over 10% in cash and fixed income and the remainder in equities. The expenses are a low 0.18%, and the fund minimum is only $1,000. If you want to be more conservative (and even though you are young, you only want to take as much risk as you can stand as you do NOT want to sell when the equities markets decline), you would look at a fund with a shorter target date, perhaps 2035. – Bobbie Munroe, Fraser Financial, Atlanta, Ga.

MORE FROM KIPLINGER: Great Mutual Funds for Young Investors

Netflix to air 'Magic School Bus' re-boot

The video streaming service will air an updated version of the popular 1990s children's show in 2016. NEW YORK (CNNMoney) All you Arnold, Wanda and (of course) Valerie Frizzle fans, rejoice: You'll soon be able to climb back on "The Magic School Bus" again.

Netflix (NFLX, Tech30) is launching a new version of the Emmy-winning 1990s animated children's series that's remained wildly popular despite ending its original run more than 15 years ago.

The new show will be called "The Magic School Bus 360°," and feature 26 CGI-animated episodes. It's slated to premiere in 2016 for subscribers' binge-watching pleasure.

The original show debuted on PBS in 1994. It taught kids science through the adventures of whacky teacher Ms. Frizzle, her inquisitive class and the enchanted bus that took kids everywhere from outer space to inside the human body.

It was big with the coveted millennial demographic in the 90's, and kids still love the show, which was in syndication until 2012. Chief content officer Ted Sarandos said it's been a "huge" hit for Netflix, which streams the original shows.

  If Netflix could've premiered any show ...

Like the original, "360°" is being produced by Scholastic Media, which published the book series on which the shows are based.

In addition to its new digital look, the re-boot promises to feature "the latest tech innovations such as robotics, wearables and camera technology to captivate children's imaginations and motivate their interest in the sciences," according to Netflix.

Related story: Netflix's TV guru: "Don't make me! wait!"

Forte, who is Scholastic Media's president, said she's excited to bring back a show that fans have told her changed their lives..

"To do an animated show that has actually encouraged young people to pursue careers in the sciences or teaching makes us very, very happy."

Netflix has already had huge hits with original shows like House of Cards and Orange Is the New Black. Netflix has revived other shows, producing the fourth season of cult favorite Arrested Development.

Scholastic has not yet begun casting for The Magic School Bus 360° so there's no word on whether comedian Lily Tomlin will revive her award-winning role as Ms. Frizzle.

The Rise of the Working Stay at Home Mom

NEW YORK (MainStreet) -- When Delaine Moore became a single mother of three kids six years ago, she explored full-time work but found these positions weren't flexible enough. The divorce recovery coach needed a job that allowed her to work three to fours a day so that she could pick up her children after school.

"I continue to look at job postings on a daily basis," said Moore whose children are 13, 12 and 10 years old. "If I could find a flexible employer I would work full time."

Instead, Delaine works from home. "A 9-to-5 means being separate from my children and not being there for them 8 to 10 hours a day," Moore told MainStreet. "I chose to be there for my kids during their formative years and to worry about my career later in life." Luckily, Delaine's memoir The Secret Sex Life of a Single Mom, (Seal Press, 2012), was optioned and acquired by Lifetime Television. "I was paid enough to get by on with my kids for a little while," Moore said. The author is not alone in opting to stay at home and work from home. According to a Pew Research Center government data survey, the number of stay at home mothers increased to 29% from 23% in 1999. >>Read More: Sorry, Mom, I Can't Afford a Mothers Day Gift This Year "Entrepreneurship is a vital key to allowing women to enjoy both motherhood and the stimulation of work," said Margie Baldock, author of the book The Mother Lode Manifesto (Star Fire Books 2013).

The Pew survey found that an increase in stay-at-home mothers is a result of rising immigration and a downturn in women's labor force participation set against a backdrop of public ambivalence about the impact of working mothers on young children. "Myself and other women executives earned money for our families, but somehow we internalized our absences as being bad parents," said Francesca Kuglen, who launched a hair products company called Jontee Accessories that was subsequently acquired by Newell-Rubbermaid. The Pew study found that 34% of stay-at-home mothers are living in poverty compared to 12% of working mothers.

"I changed professions and earned less," said Moore. "Something has to give."

The more affluent stay-at-home mothers with median family income of $132,000 were found to be older than married stay-at-home mothers with working husbands. Just 19% were younger than 35 years old, and 53% of this affluent demographic had at least one child younger than 5 years old.

"It takes courage for women to step out of the prescribed role of Suzy Homemaker," said Kuglen, who raised two daughters with her husband. "It takes just as much courage for a woman to focus on breastfeeding and organic baby food despite holding a prestigious MBA and acute edge for statistical analysis." Those who are married with working husbands generally are better off financially. They are more highly educated, and only 15% live in poverty compared to the majority of other stay-at-home mothers. "Money is so important, because not having it mostly means that women have to spend time away from their families," Baldock told MainStreet. "And not having the time you wish to have with your family is a tragedy. Every mother should be in a position to make a choice about this and not be forced by money constraints to work when she wishes to be with her family." Traditional married stay-at-home mothers with working husbands make up about 10.4 million of the nation's stay at home mothers. "The choice of husband is the most powerful indicator of how successfully a woman will be able to find balance and success," Kuglen told MainStreet. "My husband and I agreed from the beginning that there was no such thing as women's work. Dirty diapers, food shopping, cooking, cleaning, laundry, sewing, car pooling, ironing, making lunch, paying bills, financial planning and potty training are all equal opportunity jobs." >>Read More:  ObamaCare Really Is Encouraging Unemployment and That's a Good Thing Working Moms' Labor Struggles The Ninja's Guide to Complete Social Life Restructuring --Written by Juliette Fairley for MainStreet

Will Wall Street Remain the World's Financial Capital?

Getty Images "People think you can just walk right in," the bemused security guard said to his co-worker, who snickered, shook his head and returned to his outpost under the tented area outside the otherwise-regal entrance to the New York Stock Exchange. The dejected tourist walked away after learning that, no, there is no visitors' gallery at the exchange where he could watch what was happening inside 11 Wall Street. He then disappeared into a dense crowd of tourists. Nearby, folks posed in front of the George Washington statue at Federal Hall, across the walkway from the exchange. They aimed their camera phones curiously around Broad and Wall streets, many drawn to the enormous American flag that flies in front of the NYSE, where it has stood since shortly after the Sept. 11, 2001, terror attacks. And they wondered what was going on inside. This is supposed to be the financial capital of the world. Truth is, there's really not that much to see anymore inside these majestic halls. An exchange that used to house more than 5,000 traders shouting out their business now is a mostly docile habitat in which those still left on the floor quietly tap out orders on hand-held computers and barely make a peep at swift changes in market activity. Things indeed have changed a lot for the exchange over the past 25 years. The next 25 years-well, things could get dicey. The Future of Trading Will the exchange still exist? Will it be a museum? An office complex? An automated emporium run by robots? More importantly, will New York still be the financial capital of the world? Nobody seems quite sure, though the building itself does maintain its nostalgic appeal even if it's lost much of its relevance as a trading center. "Symbols matter," said Nicholas Colas, chief market strategist at New York-based brokerage ConvergEx. "It's important to have a symbol that people can relate to, and it's much easier to relate to a physical space. It will be important for the New York Stock Exchange to maintain some relevance with investors." Prospects for the building and what happens inside it hinge on three things: Just how far the trading community pushes automation, how hard regulators push back and how well the 80 or so locations now where stocks are traded can maintain their trust and credibility with the investing public. A Rapidly Changing Ecosystem New York faces a bevy of challenges. Automated trading has taken up about four-fifths of the market's volume. Dark pools -- privately run trading centers away from the NYSE -- are scattered around the metropolitan area. Exchanges around the world -- such as those in Tokyo, London and Shanghai -- are seeing their volumes increase, though they still draw just a fraction of the volume seen in New York at the NYSE and the Nasdaq. The current market is dealing with one whale of a black eye caused by suspicion over high-frequency trading and its stranglehold on market activity. The proliferation of trading aberrations such as 2010's "Flash Crash" and the intense debate over "Flash Boys," Michael Lewis' 2014 HFT-centered book, has underscored the credibility problem, which will have to be rectified -- and soon. Conversations with the folks who help make the market machinery work reveal some interesting-and surprising-thought trends. For instance, there is a pervasive belief that the market will become less fractured and perhaps even a bit slower than the current incomprehensible millisecond-moving speeds. While automation is a fact of life, there is no widely shared dystopian view of a market run by faceless machines without accountability. There's even a bit of whimsy. Look Into a Hypothetical Crystal Ball Market veteran Art Hogan sees two megamergers that could shake Wall Street. One would see Facebook (FB) and Twitter (TWTR) take over the NYSE; the other would have Apple (AAPL) and Google (GOOG) wrest control of the Nasdaq, which trades mostly tech stocks. In the Hogan scenario, the two mammoths blow out the rest of the 80 or so exchanges and dark pools where trades currently take place and defragment the market. At the same time, regulators change trading "ticks," or the increments in which stocks can trade, from the current decimalization to nickel sizes, eliminating the benefits that high-frequency traders enjoy from capitalizing on moves of pennies. Hogan is kidding ... sort of, but in a way that indicates the general direction the market needs to trend to win back investor confidence. "You've got a world [in 25 years] where technology, social media and financial markets have come together to increase investor confidence in markets," said Hogan, the chief market strategist at Wunderlich Securities. In his future vision, "Wall Street gets to play its role again as the greatest place to form capital for emerging companies, and to research those emerging companies." Don't laugh too loudly. Hogan's scenario of a market that undergoes massive transformation that actually benefits the retail investor and re-establishes some sanity in a market that has lost so much of its trading volume over the years is a widely shared vision. "We're moving faster and faster. The speeds are incredible, but we're going to get to the point where it doesn't go any faster," said Peter Costa, president of Empire Executions and an NYSE governor with 33 years of trading experience. A Quieter Street In the Costa scenario, trading changes completely. In a future world where cash becomes marginalized and digital "credits" take over as a system of payments, companies find stock issuance a trite method of raising funds. Stocks, meanwhile, start to more closely resemble mutual funds, with very little if any price movement during market hours and instead "a final pricing at the end of the day," Costa said. "There will be more financial options for investors," said Todd Schoenberger, managing partner at LandColt Capital. "For example, we now have stocks, bonds, mutual funds, etc. Look for new products to enter the market, which will be a real hassle for regulators. But, expanded options is what you get when you have too many players transacting business." Whatever form trading takes -- high speed, low speed or no speed -- what will matter most is fairness, and many Wall Street pros expect Washington regulators to continue their pursuit of an equitable environment. "What they're realizing is money managers like myself don't care about getting a sell in half a second," said Michael Cohn, chief market strategist at Atlantis Asset Management. "I don't care about the pennies; I care about the perception and the fairness. It affects my business if people think the market is not fair." If there is a common theme in terms of hopes for the future, it indeed would be some simple fairness. "You can still have automation, but it would be nice to bring back some sort of ecosystem into it," said Joe Saluzzi, co-founder of Themis Trading and an ardent campaigner against the ills of high-frequency trading. He hopes the next 25 years hold a greater emphasis on human involvement, not less. "You like to have someone involved. The investor relations officer, the chief financial officer, really has no idea what's going on in their stock," he said. "There are no specialists involved. They need more information as to what's going on. It's not there anymore." While the amount of bodies on the exchange floor indeed has dimmed considerably over the years, the level of employment in financial services has remained fairly and surprisingly resilient. Financial services jobs peaked out in late 2006 at about 8.4 million, according to the Bureau of Labor Statistics. While that level certainly has declined, the nearly 6 percent drop to 7.9 million as of March 2014 could have been much worse considering the way Wall Street banks cut jobs en masse during the crisis. A Shift to Markets Abroad Expectations, though, are for even fewer footsteps on the Street. "The amount of employees that will be working on Wall Street, if you want to call it that, is going to continue to go down year after year," said Marc Pfeffer, a former trader at Goldman Sachs (GS) and the defunct Bear Stearns who now works as a portfolio manager at CLS Investments. "I am perplexed till today to understand why there are that many people at these firms. I think they're going to be cut by a huge percentage, if they even exist at all."

"I don't think the NYSE exists anymore period." Dick Bove

So where does that leave the exchange as a physical property? If you close your eyes tightly enough you can almost see the tumbleweeds rolling across the cobblestones past the Wall Street subway station, past the Deutsche Bank (DB) building and gliding on a path to nowhere. After all, what possible use could there be for such a structure in the next age of trading? "I don't think the NYSE exists anymore period," said Dick Bove, the outspoken banking analyst and vice president of equity research at Rafferty Capital Markets. "I think it's a good television set" for appearances in the media. But is it possible the building will serve no function? Bove sees the global financial center shifting from New York to wherever countries are committed to a thriving banking sector and not obsessed with handcuffing "too big to fail" institutions. He also points out that the exchange isn't even owned by a New York firm anymore, and that most of the trading happens at high-frequency nerve centers in New Jersey.

Tobacco Merger May Be Right For Your Money… and Dividends

Lorillard, Inc. (NYSE: LO) had an impressive Tuesday trading session on reports that Reynolds American Inc. (NYSE: RAI) was interested in buying the company. The merger would consolidate the pure-play tobacco companies in America from three down to two. While we would consider this a rumor of sorts for now, there are some serious considerations here.

Reynolds is worth roughly $30 billion, versus about $20 billion for Lorillard. Altria Group Inc. (NYSE: MO), which is just the domestic side of the old Phillip Morris tobacco giant, is worth a whopping $73.3 billion. The real question is how the combined Reynolds-Lorillard would fare against Altria when competing for investor dollars and in selling to the public.

Altria generated $24.466 billion in 2013 revenue, with net income applicable to shareholders of $4.535 billion. Reynolds’ 2013 revenue was $8,236,000 and income applicable to shareholders of $1.718 billion. Lorillard’s 2013 revenue was $6.95 billion with income applicable to shareholders of $1.18 billion. So the combined companies, without any consideration on savings at all – would be $15.186 billion in revenue and net income of $2.898 billion – with a combined market value of close to $50 billion.

The dividends are all high, but Altria’s payout yield of 5.3% compares to 5.3% for Reynolds and 5.0% for Lorillard.

Lorillard shares closed up over 3% at $55.26 and shares hit a new high of $56.85 on the news, while Reynolds closed up 5.7% at $56.31 and it hit a new high of $56.48on the day. Even Altria rose by 1.7% to $37.07 against a recent high of $38.58.

With e-cigarettes coming on strong, traditional tobacco companies are going to have to be nimble. Perhaps that implies consolidation, but it also means that other bolt-on buyouts of e-cigarettes may be necessary. A Reynolds and Lorillard combination would likely (or conceivably) press more small bolt-on deals by Altria.

Sorry, but no reference to medical or recreational legal cannabis has been considered in this smoking merger outlook. At least not for now.