After two big down days, key info from the Federal Reserve and a solid start to the corporate earnings season pumped the Dow Jones Industrial Average  up 79 points Wednesday.

1. Fed minutes reveal October end to stimulus
Like a high school sophomore, Wall Street loves gossip. That's why investors eagerly awaited the details from the Federal Reserve's June policy-setting meeting, released Wednesday. As expected, Fed officials plan to end their "quantitative easing" stimulus policy this year, as early as October.

A quick reminder that that "QE3" policy is how the Fed has pumped up the economy -- the central bank buys billions in long-term bonds monthly, which keeps interest rates low to encourage you to borrow cash to spend. Last year the Fed was dropping $85 billion each month on bonds, but it has since tapered its purchases to "only" $35 billion as the economy improves.

The takeaway is that usually investors sell down stocks when they hear that stimulus is ending because they love that the Fed is juicing up the economy, even if that counter-intuitively means the economy is not in great shape. But although stimulus may now have an end date, stocks rose since the news was no surprise.

2. Container Store earnings cause some investor panic
Investors couldn't contain their disappointment after The Container Store announced a quarterly loss of about $3.6 million Tuesday night. The young company has two quarters under its belt since the IPO in November, and it's 0-for-2. 

Call the whambulance. Instead of blaming the disappointing results on something specific to the company, or even the weather, the CEO blamed a "retail funk" that has slowed foot traffic in his stores -- not just at TCS, but at all retail stores. Are you buying that excuse?

There are 60 Container Stores right now where you can buy a big container to contain your several smaller containers. The company has stated its plans to grow to 300, but that's a dubious promise, considering that growth looks weak. Revenues grew to $173 million in the quarter, which disappointed investors, but comparable-store earnings actually fell by about a percent. Plus, the company downgraded full-year earnings estimates, which is always a bad sign.

The takeaway is that the CEO is in for a major challenge and needs to toughen up. Investors don't expect to see such problems so early after a company's IPO, so they knocked the value down 8.4% Wednesday.

3. Cocoa prices surge to three-year highs
If you're sad about the death of Crumbs Cupcakes, then try sinking your incisors into a huge "I-Just-Got-Broken-Up-With" bar of chocolate. The price of cocoa has risen nearly 1% this week, reaching $3,134 per ton -- in fact, cocoa's already jumped over 40% this year, making it the second best performing major commodity worldwide.

Who's hungry? Apparently emerging markets. Consumption by emerging economies has jumped since 2004, from one-third of the $6.6 billion global supply of cocoa to nearly half of it. Sales in India are expected to surge 14% this year, and China will move up from 10th to eighth in overall worldwide chocolate binging. It seems more emerging-economy folk can afford to buy the sweet good.

Keep in mind that cocoa is traded as a commodity, like oil or gold, because its quality is considered the same no matter who produces it (unlike computers or cupcakes). But cocoa is anything but basic -- cocoa buyers don't just stuff chocolate in our faces -- they sell it in a wide variety of shapes and flavors. We play with our food, so we know the possibilities are endless.

The takeaway is that your 2:30 p.m. KitKat craving is going to cost you. With a kilogram of chocolate (our favorite size serving) projected to rise 2% from last year, candy makers are increasing prices. And Hershey just bought Shanghai Golden Monkey Food Joint Co. (seriously, that's its name) to take a bite of the Chinese market, which it expects to be second behind the U.S. by 2017.

As originally published on MarketSnacks.com

AT&T  is a company on the move. While investors might instinctively think of AT&T as a lumbering giant because of its massive size, it's still got plenty to offer. It's likely most investors flock to telecommunications giants like AT&T for its hefty dividend. Indeed, AT&T yield clocks in at a robust 5.2% -- far higher than most other stocks. In fact, AT&T's dividend stands even higher than that of its closest rival, Verizon Communications .

But AT&T isn't sitting still. It's pursuing strategic initiatives that should provide it plenty of growth to keep rewarding shareholders with big dividends. To that end, it's about to take over satellite TV provider DIRECTV .

And, fortunately, AT&T isn't sitting idly by while its balance sheet bloats with debt. It's taking proactive steps to effectively manage its financial position. If investors are scared of AT&T's debt load impacting its ability to pay its high dividend, here's why those fears are overblown.

Is AT&T's debt a major concern?
AT&T announced it will acquire DIRECTV in a massive transaction valued at $67.1 billion, including debt. To help finance the deal, AT&T recently conducted a sizable debt offering. The company sold $2 billion in long-dated bonds.

It's reasonable for investors to be concerned about AT&T's balance sheet, particularly now that it plans to absorb DIRECTV. After all, AT&T already held $71 billion in long-term debt at the end of its most recent quarter. Its financial position will be further strained by the massive acquisition and ensuing debt sale.

But it's important to note that AT&T's debt sale was done at extremely attractive rates. Thanks to interest rates remaining near historic lows, AT&T actually took advantage of a favorable environment. It offered 30-year bonds that yield just 1.4 percentage points more than similarly dated U.S. Treasury bonds, for a yield around 4.8%. That's lower than AT&T's dividend yield, so it made more sense to raise funds by selling debt than through an equity offering.

In addition, AT&T is raising funds by selling its 8.3% stake in Latin American phone company America Movil SAB . Billionaire Carlos Slim announced he would buy AT&T's investment in his company for $5.57 billion. This will provide AT&T even more financial flexibility to cushion the blow from the DIRECTV acquisition.

An important caveat is that AT&T was already in a solid financial position, generating strong free cash flow. Here are some of AT&T's most important financial metrics, and how they stack up against Verizon's numbers:

FCF source: 2013 Annual Reports

As you can see, AT&T's hefty dividend is well-supported by sufficient underlying cash flow, and its long-term debt isn't overly burdensome. That's especially true when you evaluate AT&T's debt load in the context of its peers. Verizon's long-term debt has exploded over the past few years.

Verizon has $107 billion in long-term debt, up hugely from just $17 billion two years ago. It's taking on huge amounts of debt to expand its network and infrastructure.

What the future holds for AT&T's dividend
AT&T has increased its dividend by about 2% compounded annually over the past five years, which might not sound like much, but it's roughly on par with inflation. That means investors are not only getting a nice payout, but the purchasing power of those dividend payments will be protected by AT&T's reliable dividend growth.

Future dividend growth should be in line with the recent past for AT&T. It recently increased its full-year revenue outlook, and it will realize significant synergies from the DIRECTV acquisition. Those should provide a boost to profitability and cash flow. However, it's also true that AT&T has a lot of debt on the books, without much flexibility available since it's already paying out a significant majority of its free cash flow.

The bottom line is that AT&T's dividend is secure, and shareholders should expect 2%-3% annual dividend growth from AT&T over the foreseeable future.

Get prepared for a big second half from Apple. At least that's what a look at the numerous reports pointing to a big iPhone 6 launch from Apple this fall would suggest. And the reports aren't stopping. The latest comes from Taiwan's Business Weekly (via GforGames), making rounds in the media this morning.

4.7-inch and 5.5-inch iPhone 6 mockups pictured with the 4-inch iPhone 5s. Image source: 9to5Mac, used with permission.

Unprecedented production
Apple iPhone 6 orders from suppliers are apparently unprecedented. In fact, initial orders for the new iPhone are twice those for the iPhone 5 (68 million units), according to Business Weekly. The site claims that Apple has asked Foxconn and Pegatron to begin mass production this month.

Unfortunately, Business Weekly didn't specify whether or not the order is for both the alleged 4.7-inch and 5.5-inch device or for just one version of the iPhone 6. Either way, however, it signals unprecedented production for the latest-generation iPhone.

iPhone 5s.

Apple has big plans for the iPhone 6
For further perspective, consider that Apple sold 51 million iPhones during the first quarter of availability of the iPhone 5s and 5c. That was up just 6.7% from first-quarter 2013 iPhone 5 sales. So, doubling the initial order for iPhone 6 devices compared to the iPhone 5 would likely put Apple well-ahead of iPhone 5s and iPhone 5c deliveries, assuming the demand is there. Perhaps Apple is trying not to relive the same supply limitations it runs into with every iPhone launch.

While the added perspective from Business Weekly that Apple's initial order for iPhone 6 units may be twice the initial order for the iPhone 5 is new, it's no surprise that Apple appears to be betting big on the device.

Morgan Stanley analyst Katy Huberty said in May that, based on reports from Far East Apple suppliers, it appeared suppliers were gearing up for iPhone 6 sales that exceed iPhone 5s sales by at least 20%.

Further, iPhone suppliers Foxconn and Pegatron are reportedly boosting their workforce related to iPhone 6 production by 10% and 30%, respectively. And Foxconn CEO Terry Gou says he is prepping 10,000 robots to help in Apple device production. These robots, dubbed "foxbots," will play a supporting role alongside employees in Foxconn's factories, according to United Daily News.

All of these reports support the argument that Apple has big plans for the iPhone 6.

Another reason to be bullish on Apple stock?
Given Apple's conservative valuation, meaningful growth in Apple's iPhone segment could prove to be a catalyst for the stock. And it's not just production that looks poised to be unprecedented; demand will likely be robust, too. Consider, for instance, a survey earlier this year from ChangeWave (via Fortune). After surveying 4,109 individuals, the research company concluded:

'This is the highest level of demand for an unannounced Apple model in a ChangeWave survey - stronger than we've seen in previous years for the iPhone 5S and iPhone 5 models prior to their announcements,' said Andy Golub of 451 Research [the company that oversees ChangeWave]. 'Speculation over a larger screen iPhone is clearly striking a chord with consumers.'

Can Apple truly pull off another record-iPhone launch? Given the lack of evidence to the contrary, it appears likely.

The consumer discretionary group is the only sector that posted a loss for the first half of the year, as it trailed the S&P 500 by more than 6%. Poor consumer spending in the first quarter drove earnings expectations lower and analysts largely downgraded the group. Investors may want to start making contrarian bets on the sector, as stronger economic growth and jobs data may breathe new life into the shares.

First-quarter woes persist into second-quarter performance
Despite the poor performance in shares of consumer discretionary companies, the group actually beat earnings expectations in the first quarter by 4.7%, just under the 5.1% average beat by stocks in the S&P 500. Earnings growth averaged 4.6% in the first quarter against the same period last year with sales growth of 3.9% on the year. The Consumer Discretionary Select Sector SPDR rebounded 7.3% from its February low, but still closed the quarter 1.4% lower.

The second-quarter improvement in sentiment across the general market has not been felt in shares of the group. The sector has seen the second largest cut in earnings expectations, second only to the materials sector, with analysts now expecting growth of 9.1% in earnings compared to the same quarter last year. Analysts expect sales for the group to increase by 4.7% over the year-ago period.

The widespread pessimism in the sector is not entirely unfounded. Consumer spending rose just 1% in the first quarter and May data shows an increase of just 3.5% from the prior year. The sector has seen the most negative pre-announcements with 22 companies reporting that their second-quarter earnings will fall short against just two positive pre-announcements.

Poor sentiment and inexpensive shares may mean a bargain
The underperformance in the sector has driven the price multiple lower relative to other sectors. Its forward price multiple of 17.8 times on expected earnings over the next four quarters is just 7.8% higher than the 10-year average (16.5) for the group. According to data from Factset, the group is the second least expensive next to information technology and is well below the 13% premium for the general market.

A protraction of the poor consumer environment could send consumer discretionary stocks lower, but several reasons point to a rebound when earnings start coming out for the second quarter.

Last week's blowout jobs number of 288,000 was the fifth consecutive month of 200,000-plus job growth. Average weekly hours have been steady at 34.5, while average hourly earnings have increased for 10 consecutive months. A sluggish recovery in employment has been the focus of economists and others who predict a weak consumer.

Beyond the strong jobs picture, the general economy is picking up and this could lead to optimism in consumer goods. Manufacturing has rebounded solidly since the beginning of the year and housing numbers for the last couple of months seem to imply that the spring selling season was delayed to the summer. The FDIC Quarterly Banking Profile showed marked improvement in consumer lending with the percentage of non-current loans dropping by 39% and demand increasing for unsecured loans.

Analysts have slashed their earnings expectations for Coach by 22.8% over the last 90 days to $0.53 per share for the quarter. They have also cut their expectations for the full year and the shares now trade for just 10.4 times trailing earnings against a five-year average of 17.8 times earnings. While analysts expect sales to be 6% lower this year and 10% lower in 2015, the company still commands a strong brand and a 28% operating margin. The company has $565 million of net cash on its balance sheet and created $805 million in free cash flow over the last four quarters. A program of store closings and repositioning in North America while it increases its Asia footprint should drive Coach's margins over the next year. If Coach succeeds with its repositioning strategy this could lead to a turnaround in sentiment and a price multiple closer to the market average.

Shares of General Motors  have declined 8% since the beginning of the year on the company's massive vehicle recall. As of late June, the company had recalled 25.7 million vehicles in the US due to ignition switch problems. According to Experian, that amounts to 40% of the 64.6 million GM cars and trucks on the road. CEO Mary Barra has said that the company expects to take a charge of up to $1.2 billion for recall-related repairs in the second quarter, just below the $1.3 billion charge it recognized in the first quarter. Against the massive recall, vehicle sales are holding up with an increase of 2.5% in the first six months of the year, only slightly below the 4.3% industrywide gain. The company sold 1.46 million cars and light trucks in the first half of the year with a 17.8% share of the market.

If the recall has not hurt GM's sales, there is reason to believe that it might actually drive stronger growth over the rest of the year. GM does not even make most of the recalled models anymore. The Cobalt has been replaced by the Cruze, the company's strongest-selling car and arguably one of its best-quality vehicles. GM is offering employee discounts and loans of up to 90 months, an extremely attractive offer in the low-rate environment, to customers who own recalled brands. This all translates into nearly half of the company's customers coming into showrooms for sales pitches. While the executive management of the company may not easily shake the stigma of the recalls, car sales are a local experience and dealers should still be able to push volume.

My Special Situations portfolio has been a frequent buyer of Tile Shop  as the stock has fallen, and I'm back today to buy more. Poor results from peer companies have analysts falling all over themselves to downgrade house-related stocks like Tile Shop. So I think today makes an excellent opportunity to add to my stake in this fast-growing retailer.

A quick look at the numbers
Tile Shop is a fast-growing retailer, and the market tends to price these beasts at a high earnings multiple. So when actual results underperform investors' expectations, these belles of the ball can get severely punished. And that's what we've seen at Tile Shop recently. So here's what one analyst expects.

Credit Suisse lowered its 2014 earnings forecast from $0.40 a share to $0.37 -- lowered expectations of 7.5%. Investors frothed at the mouth, and shares plummeted. The analyst also lowered 2015 targets a similar amount, from $0.54 to $0.51. So wait a second. The analyst is still expecting 37% annual earnings growth from 2014 to 2015. And in an ironic twist (and numbers game), earnings growth is actually expected to be higher now than before the downward earnings revision. (Run the numbers yourself.)

But you can hardly blame the analyst for investors' knee-jerk reaction.

Let's recall that Tile Shop is quickly growing out its store count, and this is not just a one-year exercise, but rather a process over the next decade. And insiders have purchased earlier this year at prices substantially higher than today's. I'll be looking for more insider purchases at these reduced prices.

Foolish bottom line
So tomorrow my Special Situations portfolio will buy $500 in Tile Shop stock. I expect it to outperform over the coming years, and reduced expectations are a great way to take advantage of Mr.Market's fickle moods. For more great stocks, follow me on Twitter: @TMFRoyal. And check out my dedicated discussion board.

The stock market took a hit today as investors fretted over news that a major player in Portugal's banking system could be in trouble. The fear is that a banking crisis in Portugal could cause contagion in Europe, which, in turn, would affect global markets. Most stocks gradually recovered throughout the day from morning lows, but shares of Cliffs Natural Resources , Best Buy , and Under Armour each posted steep losses nonetheless. The S&P 500 Index lost eight points, or 0.4%, to end at 1,964.

Iron ore and coal producer Cliffs Natural Resources sank 4.8% today, finishing as the worst performer in the entire S&P 500. Longtime shareholders are probably familiar with Casablanca Capital, a firm that owns more than 5% of Cliffs Natural Resources stock. Casablanca is, perhaps, the very definition of an activist investor, lobbying fiercely for a shakeup in a management team it says is destroying the company. Casablanca released a note to shareholders today calling for the ouster of six of the company's directors at the annual shareholders meeting later this month.

The fears from across the pond in Europe sparked many investors to take a good look at their asset allocations, and shift money to safe havens like gold and treasuries. This wasn't good for investors in high-growth names or turnaround stories. Best Buy shares fall into the latter category, and the stock tumbled 3.2% today as it fell out of favor with more conservative investors. While my colleague Timothy Green pointed out several days ago that the electronics retailer wisely divested from its European operations last year, he suggests that Best Buy should continue selling off its international businesses in China and, perhaps, even Canada.

Under Armour is making inroads in athletic footwear. Image source: Under Armour

Lastly, shares of Under Armour shed 2.9% today, as investors shied away from the sports apparel retailer in favor of less-expensive stocks. Under Armour trades at 75 times earnings today, quite a multiple for a company whose profit growth has been decelerating for the last four years. While Under Armour is certainly more exciting than its much larger rival Nike, it may take decades for the company to reach Nike's level of dominance in the footwear market -- if it ever gets there.

On Thursday, stock market investors initially panicked on news from Europe that suggested that a potential new financial crisis might arise involving the Portuguese banking system. Throughout the day, though, U.S. markets steadily recovered. While the market still finished down, declines were generally in the range of half a percent or less. Still, some high-profile investors are starting to look for a possible correction, and for Potbelly , Tile Shop Holdings , and Fortuna Silver Mines , the overall market's partial recovery was too little to save them from large drops today.

Potbelly plummeted 25% as the sandwich-store chain cut its guidance for the second quarter, saying that same-store sales fell 1.6%, and that net income would fall by almost 30% from year-ago levels. Moreover, Potbelly cut its full-year guidance, as well, with earnings per share likely to fall short of last year's levels by nearly half, and full-year comps coming in flat, at best. After having wooed IPO investors with the promise of being another high-growth fast-casual chain, Potbelly has started having growing pains, and unless the company can start earning better profits from its sales, the stock could potentially have even further to fall.

Tile Shop Holdings fell 9% in sympathy with other stocks in the home-improvement space, with one of its major flooring peers falling even more dramatically today after reporting weak traffic figures, and poor same-store sales for the second quarter. Even as the housing market has recovered, investors now fear that home renovation and remodeling activity might be lagging behind the home-price gains we've seen during the past year. Unless Tile Shop Holdings can differentiate itself from its competitors, it's likely to suffer some of the same headwinds that have hit the whole industry in recent months.

Fortuna Silver Mines dropped 10% despite precious metals generally having a strong day. Fortuna gave its preliminary production report for the second quarter, saying that it produced 1.6 million ounces of silver, and slightly more than 8,500 ounces of gold during the quarter, bringing its midyear production totals to around 52% to 53% of Fortuna's previous full-year guidance. Yet, as solid as these results were, they weren't enough to sustain Fortuna's upward momentum, with the stock having risen more than 70% in less than two months before today's drop. Fortuna Silver Mines has plenty of growth potential, but high valuations could prevent new shareholders from participating in that growth as much as those who bought at recent lows.

Investors love stocks that consistently beat the Street without getting ahead of their fundamentals and risking a meltdown. The best stocks offer sustainable market-beating gains, with robust and improving financial metrics that support strong price growth. Does DSW fit the bill? Let's take a look at what its recent results tell us about its potential for future gains.

What we're looking for
The graphs you're about to see tell DSW's story, and we'll be grading the quality of that story in several ways:

• Growth: are profits, margins, and free cash flow all increasing?
• Valuation: is share price growing in line with earnings per share?
• Opportunities: is return on equity increasing while debt to equity declines?
• Dividends: are dividends consistently growing in a sustainable way?

What the numbers tell you
Now, let's take a look at DSW's key statistics:

DSW Total Return Price data by YCharts.

Source: YCharts. *Period begins at end of Q1 (April) 2011.

DSW Return on Equity (TTM) data by YCharts.

Source: YCharts. *Period begins at end of Q1 (April) 2011.
^Dividend payout growth excludes impact of 2011 special dividend.

How we got here and where we're going
It sure looks like DSW put on its running shoes three years ago, because the company has come surprisingly close to a perfect score, with seven of nine passing grades today -- many of which show some very strong progress since 2011. Even if we look at DSW's free cash flow as a more accurate proxy for its bottom-line growth, it would change very little, since free cash flow has also improved at a faster rate than revenue. That makes revenue DSW's big sticking point, but there's no reason that the shoe retailer can't boost its sales enough to earn a perfect score next year. But can it? Let's dig deeper to find out.

Unfortunately for DSW investors, perfection seems a bit further away after the company reported disappointing earnings a month and a half ago. The company missed on both top and bottom lines and also reduced its full-year guidance quite a bit, and the net effect of these worrisome data points was a share-price collapse. This was the second consecutive quarterly report released this year to show a year-over-year decline on both the top and bottom lines. It hasn't been the only shoe retailer to disappoint this year -- Shoe Carnival also saw EPS plummet in March. Both DSW and Shoe Carnival released guidance at that time projecting that full-year EPS might decline on a year-over-year basis, but only on the low end of their guidance ranges.

This point should be especially worrisome to DSW investors. Although its three-year EPS growth looks quite impressive, it helps that DSW started narrowly in the red in 2011 -- over the past two years, DSW is the worst-performing shoe retailer save one, and that competitor is hurt by the fact that it makes its own footwear:

DSW Normalized Diluted EPS (TTM) data by YCharts.

Crocs has fallen further on profitability, but DSW shouldn't have the same problems, since it sells hundreds of different brands (including Crocs, interestingly enough) and is responsible for manufacturing none of them. However, brand perception still matters, whether a company is selling foam-rubber flip-flops or... well, everything else. In that regard, DSW's brand might simply be lagging behind some of the brands on its shelves, since "cheap shoes" isn't necessarily a competitive advantage in a retail environment where every customer can immediately cross-reference price data online.

No matter what excuse one wants to use for DSW's recent weakness -- management seems to have settled on the old "blame it on the weather" tactic that was so popular for the first fiscal quarter of 2014 -- it's important to note that this is the only time DSW's revenue has actually declined for two straight quarters as a public company.

DSW Revenue (TTM) data by YCharts.

Shoe Carnival and Brown Shoe are in the same boat (Brown's top-line problems have been under way for a while) with ongoing declines, which indicates that this may be more than an isolated problem. Consumers may simply have decided that discount shoe warehouses aren't worth it any more. DSW might have earned a great score this year, but it won't hold on to it for long if it can't overcome this widespread malaise.

Putting the pieces together
Today, DSW has many of the qualities that make up a great stock, but no stock is truly perfect. Digging deeper can help you uncover the answers you need to make a great buy -- or to stay away from a stock that's going nowhere.

The stock market once again proved its amazing resiliency Thursday, recovering from losses of more than 1%, as investors gradually decided that a potential crisis in Europe was unlikely to become a big enough deal to slow down accelerating U.S. economic growth. Moreover, positive news from United Continental Holdings , Zumiez , and TRW Automotive helped to set an optimistic tone for the market.

United Continental jumped 13% after releasing preliminary guidance for its second-quarter results yesterday afternoon. The airline said that passenger revenue per available seat mile climbed by 3.5% during the quarter, about half a percentage point higher than the top end of its previous guidance range. United Continental reported strong results domestically, which were consistent with what other airlines have said recently; but United also said that its Pacific segment performed better than expected. United Continental was having trouble keeping up with its airline peers recently due to some lingering issues related to the merger of its United and Continental divisions; as a result, shareholders saw the news as a positive sign of progress at the airline.

Zumiez rose 6% after the retailer said that its same-store sales rose 3.1% during the month of June, resulting in total net sales gains of more than 11% from year-ago levels. Moreover, Zumiez boosted its guidance for its second-quarter revenue and earnings, raising its anticipated sales range by 3% to 5%, and increasing its range on earnings per share by between $0.05 and $0.07. Given the headwinds that many retailers have continued to face during the spring months, the positive results suggest that Zumiez remains popular among its activewear apparel customers, and modest but consistent growth in comparables could keep Zumiez stock rising in the future.

TRW Automotive gained 8% after the maker of auto parts said that it had received a takeover bid. Although TRW didn't identify the potential acquirer, reports suggest that one of TRW's German auto-parts peers, ZF Friedrichshafen, was likely to be the unidentified bidder, and ZF confirmed that it had been in talks about a possible bid. At this point, TRW has hired a financial advisor to consider the offer, but it expects to continue its current business strategy while it evaluates whether to accept it. Given how far TRW shares have already climbed, it's uncertain how much more of a buyout premium shareholders might get if an official bid is made.

iPhone 6 mockups. Source: 9to5Mac.

Another day, another rumor about Apple's upcoming iPhone 6. The latest is from Taiwan's Business Weekly, which is making the rounds today. According to the report, Apple is betting huge on the iPhone 6, and has initially ordered 68 million units. That figure is purportedly twice as many units compared to the iPhone 5.

While Apple bulls like myself should love big figures like that, investors shouldn't put much weight into supply chain leaks of this nature. In fact, Tim Cook has directly advised investors not to pay attention to these types of rumors.

Stop me if you've heard this one before
Back in January 2013, the Wall Street Journal reported that Apple was cutting iPhone 5 orders from 65 million to 50 million. However, that 65 million figure was absurdly high to begin with. Still, that didn't stop the report from creating investor panic, as shares dropped on the news.

The reality is that Apple's global supply chain has countless moving parts and many vendors. It's not uncommon for one crucial ingredient to create production bottlenecks, particularly if that component involved an advanced new technology, and is still plagued with low yields. In 2012, this was the in-cell touch display in the iPhone 5. In 2013, this was the Touch ID sensor in the iPhone 5s.

As yields improve, Apple frequently adjusts its open orders at suppliers, and most of its orders typically cover up to 150 days. This paragraph is in every Apple 10-Q and 10-K:

These outsourcing partners acquire components and build product based on demand information supplied by the Company, which typically covers periods up to 150 days. The Company also obtains individual components for its products from a wide variety of individual suppliers. Consistent with industry practice, the Company acquires components through a combination of purchase orders, supplier contracts, and open orders based on projected demand information. 

This is a possible explanation for why that 65 million figure from 2013 seemed so high. It's because Apple over orders when yields are low, and then reduces orders when necessary. Just like the old saying goes, Apple would rather have it and not need it than to need it and not have it. 

While there's a distinct possibility that the 68 million figure is accurate, that doesn't give investors much actionable information. Here's the Tim Cook quote from the conference call back in January 2013 directly addressing the WSJ speculation:

I would suggest it's good to question the accuracy of any kind of rumor about build plans and also stress that even if a particular data point were factual it would be impossible to accurately interpret the data point as to what it meant for our overall business because the supply chain is very complex and we obviously have multiple sources for things, yields might vary, supply performance can vary. The beginning inventory positions can vary, I mean there is just a long list of things that would make any single data point not a great proxy for what's going on.

To be clear, I do hope that Apple is preparing for a massive launch, as the expected move to larger displays will dramatically broaden Apple's addressable market considering the secular shift in consumer preference toward big phones. Rather, I'm just not going to pay attention to numerical supply chain leaks around possible Apple orders or build plans. That's Tim Cook's job.

When you factor in reinvested distributions, Taiwan Semiconductor Mfg. Co. Ltd. has been a three-bagger during the eight years I've held shares in my portfolio. The S&P 500 is up around 57% during the same period.

TSM data by YCharts.

Yet, I won't sell. In fact, I expect to once again reinvest the annual distribution when it's paid at the end of the month. And I'll probably do it again next year, and the year following, and on until retirement.

Well, duh!
Not because of Apple , though that relationship is important. The Wall Street Journal cites sources who say the Mac maker could be responsible for as much as 10% of Taiwan Semi's current-year sales. For perspective, analysts are expecting TSMC to generate $23.56 billion in 2014 revenue, a 17.2% year-over-year boost. Apple would be responsible for much of that gain.

Yet, that growth won't come cheap or easily given Apple's history with suppliers. Consider Foxconn, which may as well be an Apple subsidiary. The contract manufacturer has invested in 10,000 robots to build new mobile devices, yet it's Apple that gets first crack at the line. CEO Tim Cook will expect equally big investments from Taiwan Semi.

According to the Journal, TSMC has already sent a large team to Cupertino to better understand Apple's needs while also testing a new 16-nanometer process for making smaller and more power-efficient chips for future iDevices. Watch for large, cash flow-siphoning R&D and capital outlays as these investments begin to take hold.

Why buy?
If the Apple relationship isn't a good enough reason to buy, why should you or I be interested in Taiwan Semiconductor at current prices? I've three reasons for staying invested:

1. The overall market for advanced devices is exploding. More than 1 billion smart devices shipped last year, Gartner says. Yet, that's the tip of the iceberg. Morgan Stanley estimates that, by 2020, we'll see 75 billion devices connected to the Internet, and all of them will need chips. Taiwan Semi, which controls about half of the contract chip manufacturing market, will be responsible for an outsized share.

2. Most device makers don't manufacture their own chips. While I don't have perfect numbers for the the contract chip manufacturing market, most outlets size it at $39.3 billion. In 2010, Gartner put the total at $28.3 billion. Three years of 11.6% annualized growth can't be an anomaly. More companies are looking to vendors to produce the brains of their most advanced devices.

3. TSMC has a long-term track record. Revenue is up 12.4% annually during the past five years. Earnings and cash from operations have improved 12.8% and 9.4% a year, respectively, during the same period. Gross margin has held firm at north of 40%. Intensifying competition from the likes of Intel and Samsung has done nothing to sour this sweet story.

Mix in an annual distribution that yields 1.90% for ADR owners, and I think you've the making for one of the market's best chip stocks right now.

Source: King Digital Entertainment 

King Digital Entertainment shares took a beating post-IPO, but have since recovered to above the listing. Investors have grown less wary about King's business model as the dependence on Candy Crush Saga lessens and a spinoff hits the market. Can King continue its upswing, or will shares plummet to the $3 range of Zynga ?  

Supplement Candy Crush Saga with its spinoff
Candy Crush Saga accounted for 67% of overall bookings in the first-quarter report, which was a marked improvement from the 78% pre-IPO dependence. King will soon widely release the spinoff Candy Crush Soda Saga in hopes of diversifying its game portfolio. 

Two similar games can have success at the same time. Zynga's first-quarter report showed that three games accounted for 64% of overall online game revenue, and two of the games were Farmville titles. Candy Crush Soda Saga, like Farmville 2, doesn't offer a significantly different gaming experience from the original. Soda has better graphics, but more importantly, better monetization incentives to lure players into paying for extra levels or game pieces. 

Grow the game portfolio 
King has existed for more than a decade and has churned out 180 titles. The bookings dominance of Candy Crush Saga shows the majority of that large batch of titles haven't helped with either monetization or public perception.

Farm Heroes Saga was the only non-Crush game to earn monetary mention in the first-quarter report. King wasn't specific with the numbers, but claimed that Farm Heroes was the reason the Candy Crush dependency fell that quarter. Bubble Witch Saga 2 has since widely released to Android and iOS operating systems, and sits among the top free downloads for both operating systems.

Popular games can further establish King's brand, regardless of the monetization potential. The company has a low-risk development process that can minimize the chance of a new game flopping after launch. King uses its royalgames.com website to test early, partial versions of games to gauge potential interest. Flubs can go out to pasture, while hits move up to full-stage development. 

Monetization remains the key long-term concern for the most-played titles, as King needs to keep diminishing its Candy Crush dependence. 

Organically improve monetization metrics
King's new deal with AppAttack to preinstall games onto select mobile devices has the potential to skew user metrics like monthly active users and monthly unique users because more people will take a game for a test run if it's already loaded onto the device. One key monetization metric won't suffer from this inflation: monthly active payers, or MUPs. 

MUPs refers to the number of players who have made an in-game purchase during a specific month, with three months averaged in a quarterly report. The metric can't inflate with the pre-installations, since people just testing a game are unlikely to spend real money for the experience. 

Here's a look at King's MUPs compared to Zynga: 

Source: Company filings 

The quick rise of King's MUPs tied directly to Candy Crush Saga's growing popularity -- and the drop toward the end coincided with a drop in Candy Crush players. Zynga has its own MUP problems, but its downward slope isn't as steep or threatened by one game. 

King could turn the MUP issue around if Candy Crush Soda Saga achieves even a fraction of the popularity of its predecessor. Soda's heightened monetization options could also lead to the title becoming more profitable, even while attracting fewer players. Farm Heroes Saga could also continue its growth story, potentially with Bubble Witch Saga 2 right on its heels. 

Foolish final thoughts 
Zynga is expected to report second-quarter results later this month, and King is expected to follow with its own report in August. Game dependence and MUPs will provide the best health check for both companies. King needs to show a continued drop in Candy Crush dependence and some specific numbers on Farm Heroes Saga and Bubble Witch Saga 2 to demonstrate the monetization of those games. Candy Crush Soda Saga won't fully launch until fall, but has already racked up enough popularity that the game might provide earnings help by the third-quarter report. 

Shares of lululemon athletica  have been under a great deal of pressure lately. In fact, the yoga-wear retailer, which was once everybody's favorite on Wall Street, has seen its shares fall over 31% since the beginning of 2014.  If that weren't enough, shareholders face the reality that the pullback did not just stem from one cause but several.

Not only have there been product quality concerns with its luon pants, there has also been trouble at the top that stemmed from difficulties in finding a new CEO, as well as statements made by the company's founder and largest shareholder, Chip Wilson, who publicly said "Quite frankly, some women's bodies actually just don't work for [the pants]. They don't work for some women's bodies" at lululemon. However, the worst of it all is concerns that the company's best days are behind it and that it just can't and won't grow as much as it did in the past. Fortunately for lululemon shareholders, that might not be the case.

North America
Believe it or not, the company still has plenty of room to grow in its home market of North America. Granted, it will occur at a slower pace, but this will mainly result from the company's organic growth strategy and not problems with the brand or products. Unlike many retailers, lululemon doesn't open stores, run huge ads on television and radio, or hand out coupons; instead, the company seeks to be part of the community and grow organically.

The company generally targets a particular location where it wants to open a store and then opens a showroom, which is typically around a third of the size of a normal lululemon store. This allows local consumers to not only see the products but to warm up to the idea of having a lululemon store in the local community. Once a showroom store sees brisk enough business and its yoga classes fill up fast, the company moves to open a standard lululemon store. This may take longer than the average store opening, but rest assured it leads to huge profits and enormous customer loyalty.

At the end of fiscal 2013, which concluded on Feb. 2, 2014, the company operated just 225 stores in North America comprised of 171 stores in the United States and 54 in Canada. This amounts to just over three stores per state in the US which seems to imply that while growth will be slow and steady due to the company's strategy, lululemon has a large runway ahead of it. In addition to its traditional women-focused lululemon stores, the company also plans to open up its ivivva athletica branded stores (which is the company's youth brand).

England and the rest of Europe
Lululemon's growth plans include an English invasion as London, which has a population of 8.3 million, has a number of yoga devotees. Fortunately for lululemon shareholders who are looking for growth, the company is just getting started here. Believe it or not, lululemon has just one full-sized store in all of London, located in London's Covent Garden district. The store opening created a great amount of buzz and included a yoga-themed event at the Royal Opera House.

Not only that, the company plans to roll out four stores in the near future. Currently, lululemon operates four showroom locations in London. It has a goal of building community support for the brand with these showrooms before it opens full-sized retail stores. It's not hard to imagine lululemon expanding far beyond London into the rest of the United Kingdom and Europe itself.

Asia and Australia
In addition to the company's expansion plans in London, lululemon also has big plans for Asia that are just in their infancy. Surprisingly, the company already has a decent presence in Australia and New Zealand, where the company already has a total of 29 full-sized stores. It currently plans to open two lululemon stores in Australia this year and its first showroom stores in Asia within the next two years. This may not sound like much, but investors need to keep in mind that lululemon has such profitable stores because people see them as part of the community and they grow organically -- and that takes time.

One step ahead of the competition
Lululemon is definitely on its way to further expansion of its brand abroad. This in itself puts lululemon one step ahead of Gap's Athleta brand, which is Gap's own athletic brand for women. For instance, as of Feb. 2, 2014, Athleta operated 65 stores in North America and planned to open 30 new stores in North America by the end of fiscal 2014.

Unlike lululemon which opened its first store in November 2000, Gap did not open the first Athleta store until 2011 even though it acquired Athleta in 2008. By February 2015, Gap plans to have about 100 Athleta stores in North America. While these openings will greatly benefit the company's onward expansion and growth, Athleta will still trail lululemon in total store count, as it had 263 stores as of May 4, 2014. Furthermore, it will likely take a few more years for Gap to feel comfortable with expanding its Athleta brand abroad as North America remains its primary focus.

Foolish takeaway
Lululemon's astronomical growth may very well be behind it, but that doesn't mean the company doesn't have many years of healthy, sustainable growth before it. The company has come a long way and hasn't even begun to scratch the surface of the potential markets in London, Europe, and Asia. It's easy to get distracted in the problems of today and forget what the future has in store for this unique yoga brand. Foolish investors should surely keep all of this in mind when they think about buying shares of lululemon athletica.

It's been a rocky road during the last few years for Advanced Micro Devices . As the PC market softened during 2012 and 2013, AMD and its longtime rival, Intel , saw their revenues contract on a year-over-year basis. Intel's revenues were buoyed by a strong datacenter group business, and AMD's revenues as of late have enjoyed a boost from its semi-custom business -- namely, participation in game consoles.

With AMD's earnings report fast approaching, and with market research firms like IDC and Gartner reporting that the PC market is springing back, the time for AMD to shine is now.

PCs could be better than expected, even if share loss is meaningful
Intel recently pre-announced a stronger-than-expected quarter as a result of PCs intended for corporate/business use, which might initially seem to benefit Intel more than it does AMD, given Intel's greater exposure to business PCs. However, recent reports show that the PC market, as a whole, seems to be getting a lot better -- perhaps indicating that the consumer market has been improving, in general.

Now, if this is the case, then it seems likely that AMD may surprise to the upside. Even in the case where AMD loses PC share, AMD's guidance/assumptions seem to be based on a view that the TAM will contract 7%-10% for the year. Since it's increasingly likely that this will not actually be the case, AMD could wind up surprising to the upside.

Semi-custom could get interesting
Though it would be unreasonable to expect a large near-term snapback in AMD's PC chip share -- Intel is likely to fight vigorously to defend it and move into the low end -- a stable PC business with incremental adjacent opportunities leading the charge could help drive AMD's long-term growth and profitability.

For example, AMD executed quite well with the game console APU projects, which lent the company significant credibility. While it's tough to envision that there are too many huge game console-like opportunities out there, there are probably a bunch of reasonably sized opportunities in the broader embedded market that, in aggregate, could drive nice growth.

Servers? Let's wait and see.
AMD appears to be one of the more credible ARM -based server players on the market, given that it does have more experience in the general purpose server market than any of its ARM-based competition. The open question here is whether moving to the ARM architecture is going to fundamentally change AMD's competitive positioning in the server market.

AMD found it difficult to compete with Intel in just about every sub-segment of the x86 server market, and it's not as though the ARM server TAM is fundamentally different from the x86 TAM. AMD still needs to compete with Intel head-on, but it now also needs to overcome the difficulties associated with being an alternative instruction set architecture in this market.

At this point, I have very little optimism for AMD's ability to meaningfully reverse its share position in servers, though if it is able to do so, that could drive meaningful upside to the stock.

Foolish bottom line
When AMD reports its earnings on July 17, it will be interesting to see if it was able to catch the PC-recovery wave as Intel did when it pre-announced earnings. More importantly, though, investors should compare the guidance that AMD issues on its Q3 call to the guidance that Intel will issue on its own call two days beforehand. If both trend in roughly the same direction, then AMD's stock could have quite a bit of room to run.

If a master limited partnership has large projects expected to come online in the near future, you would expect shares of it to trade at a pretty decent premium. After all, those growth plans normally mean distributions will increase, as well.

Surprisingly, this isn't the case at Spectra Energy Partners today. Despite the fact that the company expects to put more than $3 billion in projects online between now and 2016, shares of Spectra Energy Partners are relatively undervalued when compared to its peers Magellan Midstream Partners and ONEOK Partners  

Find out how much Spectra is trading in comparison to its peers, and what metrics are used to value master limited partnerships in lieu of the traditional price-to-earnings ratio, by tuning into the video below.

If you didn't know anything about what happened with the stock market earlier today, then the more than 70-point drop in the Dow Jones Industrials might come as somewhat of a disappointment after yesterday's impressive gains. Yet, today's move in the Dow was arguably even more encouraging, as the market recovered from losses of as much as 180 points after investors realized that, even with some bad news from Europe, the progress that the global economy has made in healing during the past five years is unlikely to be undone overnight. Helping to boost investors' spirits were Verizon and Intel , both of which defied the Dow's losses to post sizable gains Thursday.

Verizon gained 1.5% after releasing favorable comments about its just-ended second quarter at a media-finance conference. CEO Lowell McAdam told attendees that he expects Verizon's wireless division to announce that the company had more than 1.4 million net retail postpaid additions during the quarter, with favorable churn rates, and solid growth both in smartphones and in tablets. Moreover, Verizon said its margins would remain consistent with past quarters, addressing investor concerns that pricing pressures from Verizon's rivals might lead to a price war that would, in turn, reduce margins. With healthy results even from its traditional wireline business, Verizon appears to be firing on all cylinders and sustaining its lead in the increasingly competitive wireless-network industry.

Source: Intel.

Intel rose 1.2%. The chip giant has already boosted its own guidance for the quarter, pointing to surprising strength in PC sales in bolstering the company's sales and net income. Yet, as investors prepare for the company to report its earnings next week, Intel needs to demonstrate that its longer-term initiatives to gain market share in the key smartphone and tablet space will finally start to eat into the competitive advantage that early moving rivals gained in the mobile arena. Moreover, an interesting new threat to Intel could emerge in the years to come, as rivals start to look at chips that don't use traditional silicon as its basic raw material. Still, with its in-house foundries, Intel could well play an important role in industry R&D, as scientists aim at finding ways to make chips even smaller.

Investors need to remember that, sometimes, even a losing day can be a sign of encouragement for the stock market. When the Dow is able to cut its losses after alarming news, it shows just how strong the underlying fundamentals of the U.S. economy are, and that could help support the Dow and the rest of the stock market well into the future.

Major indexes opened the day sharply lower on concerns about Portugal's largest bank, but gained throughout today to finish down only moderately. The Dow Jones Industrial Average  closed 71 points lower, or 0.4%, as the S&P 500 also fell 0.4%, and the Nasdaq lost 0.5%.

Meanwhile, most indexes in Europe fell more than 1%, with Portugal's PSI sinking 4.2% as Espirito Santo Financial Group, the biggest shareholder in Portugal's largest bank, suspended trading of its stocks and bonds due to "material difficulties" at its parent company, which had missed some debt payments. It's been a while since concerns about European defaults last rocked global markets, but many smaller eurozone economies are still struggling to maintain positive growth. Government officials stood by the bank, which said it missed payments to a just "a few clients," but investors fear that the news could be a sign of more problems to come.

Back at home, initial unemployment claims last week fell from 315,000 to 304,000, lower than estimates of 311,000, indicating that strong job growth seems to be continuing into July after last week's official report showed that nearly 300,000 jobs were created in June. Continuing unemployment claims for the week ending June 28 rose slightly to 2.584 million, but still remained near post-recession lows as the four-week moving average hit its lowest point since October 2007.

Home-improvement retailers dropped today after Lumber Liquidators  said its second-quarter results would be much weaker than expected, blaming lower existing home sales and internal operational issues for the drop in profits. Comparable sales fell 7.1% after jumping 14% a year earlier, as customer traffic fell sharply and worsened throughout the quarter. Shares of the hardwood flooring retailer fell 21%, and brought down peers including Tile Shop Holdings, which dropped 9%, Home Depot, down 1.7%, and Lowe's, which lost 1.4%.

Elsewhere, American Apparel  shares popped 21% in late afternoon trading, and continued to gain after hours as the hedge fund Standard General took a stake in the struggling clothing retailer. Standard General will inject $25 million into American Apparel, and ousted CEO Dov Charney agreed to become a strategic consultant as a result of the agreement.

Shares of American Apparel, which makes casual clothes for teens and young adults, have fluctuated wildly since Charney was pushed out of the leadership role for personal misconduct just weeks ago. Among other possibilities, Charney had considered taking the company private, though today's development seems to remove that outcome. As part of the deal, five of the board's seven directors will also step down, and Standard General will nominate three new ones. American Apparel has not seen a profit since 2009, but a change in leadership could help lead a turnaround for the respected brand. An investigation into Charney's misconduct, which revolves around his knowing of an employee's plan to publish nude photos of a co-worker, is ongoing, and Charney's status with the company will be decided after its conclusion.

Telecom equipment maker ADTRAN is down 14% so far this year, as declining enterprise sales have weighed on the company's results. Carrier enterprise spending is in transition mode due to the Federal Communications Commission's Connect America Fund, or CAF, initiative. This has led to a drop in carrier spending for the time being. As a result, ADTRAN missed the Street's first-quarter revenue guidance. 

ADTRAN's prospects, however, look strong. Clients such as AT&T and CenturyLink should help ADTRAN improve its performance going forward, as they are spending aggressively on network expansion.  The company is already seeing momentum in some of its businesses, and strength in carrier spending will help it come out of its slump.

Positive indicators
The company's broadband access segment was up 13% year over year in the first quarter, driven by a robust performance from its international business. ADTRAN witnessed strong shipments in fiber to the node, with products such as vectored very-high-bit-rate digital subscriber line, or VDSL, VDSL2, and gigabit passive optical network, or GPON, gaining traction. 

It also saw strong momentum in carrier Ethernet, along with Ethernet switching, for the Internet working product category. Shipments of ADTRAN's OPTI-6100 products increased in the quarter, which is a sign of revival in carrier spending. ADTRAN's value-added reseller channel also added approximately 70 new partners to its dealer base.

According to ADTRAN, the transition to the new CAF will be beneficial for its business as carriers eventually adjust to the new rulings. The enhanced funding for CAF phase-2, and its eventual implementation, will bolster the company's customer base. The company believes that CAF will provide additional incentive for carriers to upgrade their infrastructure and, as a result, ADTRAN should see an increase in carrier spending.

End-market improvements
The company believes that its products and geographic diversification are well-timed with the carrier cycle associated with the rollout of ultra-high-speed access. There's an accelerated adoption of next-generation access technologies by carriers around the world to strengthen their competitive positions and meet increasing customer demand.

For example, AT&T and CenturyLink are upgrading their networks to stay competitive, and both are ADTRAN clients. 

AT&T is preparing to build out a fiber optic network under its Project Velocity IP initiative. The telecom giant recently announced a plan to expand its ultra-fast fiber network to approximately 100 cities and municipalities across the U.S. AT&T will cover 21 new metropolitan areas with its fiber network as it tries to nip competition from Google in the bud. The search giant is also busy rolling out its fiber network in select locations. AT&T intends to deliver broadband speeds of up to 1 Gigabit per second, and as it builds out the fiber network by investing in infrastructure, ADTRAN's prospects will improve. 

CenturyLink is also expanding its GPON, along with deployment of fiber to commercial buildings. It is trying to deliver fast Ethernet-quality speeds to customers with GPON, enabling them boost their businesses with better cloud facilities. Meanwhile, the deployment of fiber for wireless towers by CenturyLink will result in increased demand from wireless carriers for data backhaul, leading to additional business opportunities for ADTRAN.

CenturyLink is also deploying its advanced cloud node to six data centers. It will complete this exercise by the end of the year, thereby boosting demand for ADTRAN's nodes.

The bottom line
ADTRAN has struggled this year. As a result, the stock has become cheap in terms of valuation, with a forward P/E ratio of 17. It also has a PEG ratio of 0.87, indicating undervaluation and earnings growth.  Analysts also hold a similar opinion, and according to Yahoo! Finance estimates, ADTRAN's earnings are expected to grow at an annual rate of almost 25% for the next five years. The stock might be trading lower this year, but a closer look at its business and valuation indicates that it could be a good buy on the drop.

Nearly 50 years after Intel co-founder Gordon Moore first postulated it, International Business Machines is investing $3 billion to make "Moore's Law" obsolete.

A fantastic voyage to the limits of semiconductor space
Why? And why now? Physical limits are coming into play, as chip manufacturing scales from 22 nanometers -- where transistors are so small that you could fit 100 million of them onto the head of a pin -- to 14, and then 10. Anything smaller is going to require new technology. As IBM puts it in a press release announcing the investment:

Silicon transistors, tiny switches that carry information on a chip, have been made smaller year after year, but they are approaching a point of physical limitation. Their increasingly small dimensions, now reaching the nanoscale, will prohibit any gains in performance due to the nature of silicon and the laws of physics.

IBM's five-year investment plan covers two research areas. First, Big Blue will study ways to manufacture silicon-based chips at 7 nanometers or below. Second, the company will expand efforts to manufacture "post-silicon" chips that don't face the same limitations as those used in today's computers. Read the full release if you're interested in the various "post-silicon" chip technologies Big Blue is exploring.

Smaller makes bigger, better
What IBM stock investors need to understand is that this isn't some blue-sky project. Tom Rosamilia, senior vice president of IBM's Systems and Technology Group, predicted that today's efforts will lead to "fundamentally different" hardware systems 10 years from now.

We should hope that he's right. IBM still depends on sales of large-scale, high-performance computer systems. In 2013, Rosamilia's Systems and Technology Group accounted for 15% of revenue, and 10% of operating profit. (Source: S&P Capital IQ.)

Mobile devices can also benefit from new chipmaking technology, especially now that slim smartphones and tablets possess much of the same processing power found in today's computers. But don't take my word for it; look at NVIDIA's Tegra K1, which will reportedly bring the power of a desktop processor to Google's experimental Project Tango tablet.

The endgame
IBM wouldn't benefit as much from advancements in mobile chipsets. At least, not directly. But that's also the beauty of Big Blue's model. The company would surely patent any breakthroughs that allow for new styles of high-performance, low-power chips, adding to a licensing portfolio that already collects more than $1 billion in royalties annually.

And even if it isn't first out of the gate with a solution to the "post-silicon" problem, IBM says in its press release that it has more than 500 patents in related technologies. That's a big statement backed by an even bigger $3 billion bet on the future of computing, one that I'm expecting will pay off for IBM stock owners.

It is admittedly surprising to see that Intel is having such a tough time ramping its upcoming Broadwell processor into high volumes. It's clear that Intel's aggressive goals for pursuing significantly improved transistor performance, as well as a greater-than-normal density improvement, came at a price - the delay of its next generation PC processor. As a result of this, should you freak out?

It really depends on the competition
The "doomsday" scenario for Intel as a result of this delay goes a little something like this:

• Intel delays its 14-nanometer microprocessor lineup
• This allows the foundries such as Taiwan Semiconductor and Samsung to "catch up" to Intel
• Intel's biggest structural advantage -- a semiconductor technology leadership -- goes away

Now, this thesis is largely predicated on the following facts:

• TSMC's and Samsung's 16/14-nanometer processes are roughly comparable to Intel's 14-nanometer process
• TSMC's and Samsung's customers can roll out products based on these processes during 2015

If all of those hold true, then yes, Intel's manufacturing lead will have diminished significantly, and its biggest weapon in the fight against the ARM ecosystem essentially disappears.

That's a ton of "ifs"
According to TSMC's and Samsung's marketing departments, they will go into production on their 16/14 nanometer processes, respectively, early next year. What this means for actual products, however, is an entirely different ballgame. Further, Intel claims that it has a performance/density edge over the foundries' respective processes, though full disclosures at a technical conference such as IEDM should shed some more light on the matter.

That said, as investors, we can try to connect the dots. Intel has traditionally had a significant transistor performance lead at any given time. Further, it has adopted next generation technologies, such as Strained Silicon, High K/Metal Gate, and FinFET well before the foundries have. Does it really stand to reason that, after years of pretty sustained leadership, Intel would all of a sudden see its lead evaporate in just one generation?

It seems more likely that Intel simply got too aggressive with trying to push the boundaries of its 14-nanometer process, and that aggressiveness blew up in the company's face -- forcing the product delays.

Should you freak out about the Broadwell delay?
It's disappointing that Intel is late with Broadwell, particularly after having promised production in 2013, only to retract that claim a month afterward. Further, though Intel's CEO indicated on the most recent conference call that the first Broadwell parts had gone into production during the first quarter of 2014, it's a bit alarming to see leaked internal documents hit the web claiming that the first parts don't go into production until July, with other parts following on much later.

Source: VR-Zone China.

It will be important to pay attention to the upcoming Intel earnings call, as at least one sell-side analyst is likely to ask about this delay if Intel doesn't volunteer an update. Listen to answers to the following questions:

• Will the 14-nanometer delay impact the previously disclosed launch timings of Cherry Trail (14-nanometer Atom for tablets) and Broxton (high end 14-nanometer Atom for premium phones/tablets)?
• Will this delay of Broadwell impact the launch timing for the next generation product, codenamed Skylake for laptops? (Leaked roadmaps suggest Intel is skipping Broadwell in desktops and moving to Skylake directly in Q2 2015. If so, does that push out the 10-nanometer follow-on known as Cannonlake?

If Intel assures investors that the 14-nanometer Atom product line (particularly Broxton) is still on track to what was presented at its Investor Meeting back in 2013, then Intel's competitive position will still be extremely strong. If not, then the Intel thesis gets a bit tougher.

Foolish bottom line
It's not yet time to freak out about the delay of Broadwell. Wait until the July 15 conference call, where Intel's management team will likely update investors on what's going on here. Delays are never fun, and it's easy to get caught up into thinking that Intel failed to execute while the rest of the industry will march ahead unabated.

However, the reality is that if 14-nanometer was hard for Intel, it's probably going to be even harder for the foundries and their fabless customers.