Whether you're talking sales, net income, or everything in between, on just about all things Lowe's Companies continues to hit new record highs -- including its stock price. Is it time to finally take profits and exit Lowe's while the getting is good? Maybe that isn't a good idea. Here are three reasons Lowe's may still have of plenty more upside to go.

Source: Lowe's.

Reason 1: Underpromise and overdeliver
Lowe's originally guided for the fiscal year ending January 2015 to show a sales rise of 5% and for same-store sales to rise 4.5%. With the last quarter's report, the company revised its guidance. Sales are now expected to rise by 4.5%, along with same-store sales growth of 3.5%. More importantly, the company kept the diluted per share outlook at $2.63 because of stock buybacks and better margins.

Nobody likes to see softer revenue outlook, but in terms of stock ownership and a historically conservative Lowe's, we could see a situation where the company is simply setting itself up for an underpromise-and-overdeliver situation. Any even slight upside in sales delivery should translate to an even bigger bottom-line improvement and surprise.

The wild card is Lowe's newer ProServices program, which is focused on business customers. For 12 quarters in a row, it has outpaced the rest of its business. CFO Bob Hull stated in the last conference call that there is still "a lot of focus" in ProServices and that "we expect continued traction and momentum in the second half of the year." The company has been overall positively surprised by this segment of its business, so more surprises may be in store later this year.

Source:  Lowe's.

Reason 2: An improving housing market
It should be obvious: The company known as "The Home Improvement Store" gets a boost when there is more homeownership, and thus potentially more homes in need of improving. In the last call, CEO Robert Niblock stated, "As we look at the backdrop for the second half of 2014, economic forecasts suggest continued strength in the home-improvement market as employment, income, and consumer spending levels continue to improve."

Niblock noted that the company is seeing "a more positive and sustainable trend" in terms of existing-home sales along with a rise in big-ticket projects. The key to continued positive trends in housing is twofold. First, it will of course directly help sales. Second, it will probably deliver confidence to investors in Lowe's for the near, medium, and/or long term. Higher confidence tends to breed higher trading multiples. In other words, good macro housing data could lead to a higher P/E ratio.

Source:  Lowe's.

Reason 3: Cashola
Lowe's has been raising its dividend annually for about the past decade. Nothing says confidence louder than returning larger and larger piles of cash back to shareholders. As of last quarter, Lowe's had $4.3 billion left in its stock buyback authorization after buying back $1.1 billion for that single quarter alone. Sure, $4.3 billion might not seem like much on a market cap of $53 billion, but it is 8%, which is a rather decent chunk.

Eight percent would act as an 8% boost to earnings per share. For example $2.63 EPS would be boosted to $2.84. Another aspect that many people overlook with aggressive buybacks is that they make dividend payouts (and raises) much cheaper and more likely. With 8% fewer shares outstanding, Lowe's could raise its dividend by 8% and it wouldn't cost it a penny more than it paid before the buybacks. Higher dividends are not only great to get the money in your pocket, but higher dividend yields also tend to affect stock prices, and a higher yield is often corrected with a higher stock price.

Source: Flickr/Jeffrey Turner.

A conglomerate like General Electric offers different things to different investors. Some gravitate to GE for its big bets on energy, while others appreciate the company's unique culture of innovation. And then there are those who just want a healthy dividend payout, which GE has maintained for over 100 years.

GE manages to fit the mold for each stripe of shareholder, but I would argue that the company has bent over backward for dividend enthusiasts since the recent economic meltdown.

In GE's 2012 annual report, for example, CEO Jeff Immelt stated, "We want investors to see GE as a safe, long-term investment. One with a great dividend." He went on to point out that, in terms of allocating cash, "The top priority remains growing the dividend." The dividend comes first, bar none. 

As it continues to reposition itself as a manufacturing-heavy blue chip, here are three reasons dividend investors will continue to flock to GE.

1. Management shows shareholders the money

The first reason to feel optimistic about the dividend is that Immelt and company seemed to have learned a lesson from their banking identity crisis in 2008. The quote mentioned above, for instance, indicates that the sanctity of the dividend has imposed discipline on their cash management approach.

And if you think that's just lip service, consider some of the recent trends at GE:

• Between 2010 and 2013, dividends per share grew from $0.46 to $0.79 per share, an increase of 72%.
• GE's current and projected dividend yield is 3.5%, versus an industry average of 2.2%.
• Total cash returned to investors has jumped 176%, from $6.6 billion to $18.2 billion, between 2010 and 2013, including share buybacks and dividends paid.

Most important, GE's dividend is more than outpacing inflation, it's walloping it at a growth rate of 20% versus 2% since 2010.

2. The dividend's not breaking the bank

It's great to see the dividend growing at such an impressive rate, but investors also want to know that it will prove sustainable. The dividend cutback in 2009 was hard enough to swallow; any hint of another one would give this shareholder an ulcer.

A good way to gauge the affordability of the dividend is to look at the payout ratio as a percent of cash flow or earnings. At the end of 2013, GE's payout represented 54% of free cash flow per share, well below the preferred ceiling of 65%. From a different angle, the payout ratio stands at only 62% of 2013 earnings. 

So far, GE's played its cards conservatively since the financial crisis, which has given it time to fortify its balance sheet and accelerate earnings. As a result, there's little reason to fret over the payout at its current trajectory.

What's more, investors can take comfort in the fact that GE is the second-richest company in America in terms of domestic cash on hand. Only Bank of America topped GE's $88.7 billion cash balance in 2013.

3. The company's strategy is sound

Finally, dividend investors want a growing, sustainable dividend to be supported by a competitive underlying business. And GE fits the bill here as well.

A durable competitive advantage -- also referred to as an "economic moat" -- is built on one of four main pillars: a strong brand, economies of scale, network effect, or high switching costs. It's hard to argue GE doesn't have clout in every one of these categories.

GE's brand is ranked as the sixth most valuable in the world according to the widely recognized Interbrand brand report. And when it comes to economies of scale, GE came to symbolize this phrase during the go-go days under Jack Welch's leadership, and size is still a differentiator today.

Finally, as I've pointed out before, GE's future profits will depend heavily on network effects and the high hurdles imposed by switching costs. Put simply, GE's making substantial investments to offer follow-on maintenance services for its equipment around the world. It's also betting big on predictive tools like the industrial Internet.

The more places that GE operates in, the easier it is for customers-such as airlines or oil companies-to rely on its expertise when something goes wrong. Likewise, GE's software will impose huge switching costs when companies take advantage of the power of "big data" and analytics to reduce downtime on their machines.

All things considered, GE has a strong edge in manufacturing, which is crucial as it looks to distance itself from its banking days of old.

A new-and-improved GE wants to focus on manufacturing things like rail locomotives. Source: General Electric.

Why it's not too late to hop on GE's dividend train

We Fools have been singing the praises of dividend stocks for years, and perhaps more so than ever since the financial crisis. When investors like us crave stability, steady payouts provide it.

GE management got this message and shored up the company's balance sheet. Looking ahead, GE's dividend is backed by a pile of cash and a sturdy business. For those who've sat out thus far, it's not too late to get on board.

In its second-quarter 2014 earnings report, PepsiCo  raised guidance for its full-year "core" (adjusted) earnings per share, from 7% to 8%. You can see quite clearly what boosted management's confidence from this detail of a rather lovely infographic the company produces each quarter as part of its earnings release:

Source: PepsiCo. The complete Q2 2014 earnings infographic can be found here.

Organic revenue growth, that is, growth after adjusting for acquisitions, divestitures, and the effects of foreign currency translations, is up 4% through the first two quarters of 2014. As I discussed in a recent article, that's no mean feat, given both the tepid global economic recovery as well as an increasingly fractured geopolitical environment. My Foolish colleague and consumer goods maven Tamara Rutter provides an example, pointing out that Russia's recent boycott of western goods could have some impact on PepsiCo, as Russia alone accounts for over 7% of PepsiCo revenue.

Yet the company has skilfully navigated a tricky macro environment over the first half of 2014. Let's look at three big-picture items that have bearing on how well PepsiCo continues to solve the earnings puzzle as it reports its third-quarter earnings before the opening bell on Thursday.

Watch Frito Lay North America
Last quarter, Frito Lay North America, or FLNA, the company's snacks division, increased revenue by 2%, two percentage points less than both its recent quarterly trend and its previous full-year growth of 4%. On the company's earnings conference call, CEO Indra Nooyi stated that she wasn't too concerned about the division's performance. Nooyi remarked that while the snacks business had witnessed a slight decline during the quarter, part of the effect may be attributable to a promotion that was moved from the second quarter to the third. In addition, at the time of the earnings call (late July), the company was already seeing increased activity at FLNA. PepsiCo certainly has an interest in returning FLNA to its current trend: The division is the company's second largest, and it has accounted for more than one-fifth of PepsiCo revenue so far this year. 

Carbonated soft drinks: Expect a moderate drag
For the last couple of years, both PepsiCo and beverage arch-rival Coca-Cola have struggled with declining sales of their flagship soft drink brands as consumers opt for healthier beverages, and as other types of refreshment including bottled teas, energy drinks, and juices rise in popularity.

Through promotional activities, PepsiCo has sought to limit the damage from the flailing fortunes of megabrands like Pepsi and Diet Pepsi. Last quarter, PepsiCo Beverages America, or PAB, reported an overall organic growth rate of 1%, which was affected by a 2% decrease in North American carbonated soft drink volume.

This quarter, investors may likely see a similar decline in North American soda pop versus last year. Yet PepsiCo's task isn't really to light a fire under these sales, but to hold the deterioration to manageable levels. PAB is the company's largest division, having contributed one third of total revenue year to date. Any further weakness in soft drinks could cloud the company's back half of 2014.

Will the strong U.S. dollar catch PepsiCo by surprise?
If you're invested in a number of multinational companies, you may hear a complaint from many of them over the next two quarters: The U.S. dollar is on an almighty tear. This affects U.S.-based companies with a diversified book of business around the globe, like PepsiCo.

A strong dollar decreases the value of foreign sales denominated in local currencies, which are then translated back to U.S. currency when earnings are reported. While the dollar has shown strength this entire year, it's posted a singularly impressive performance in the foreign exchange markets this summer, rising over 8% against a mixed basket of foreign currencies.

The dollar really started to take off just after PepsiCo executives confidently raised their EPS forecast by 1% in July. Don't be surprised if the company points to the greenback as a damper on revenue and earnings growth in Q3. If management changes its bias and guides earnings downward for the rest of the year, we can take an educated guess beforehand that the U.S. dollar's strength will be one of the reasons. 

Given executives' assured tone at the second-quarter earnings in July, it's likely PepsiCo will post a solid quarter. But the proof will be in the earnings, and we'll revisit the themes above, and any other noteworthy items, after the company reports later this week.

Saying tech giant Apple's iPhone 6 and 6 Plus smartphones are a hot commodity would be an impressive understatement.

Source: Apple

As perhaps the most anticipated tech story of the year, it should surprise exactly no one that demand has largely exceeded supply for Apple's new smartphone lineup, especially the larger iPhone 6 Plus.

Apple set yet another record for first weekend iPhone sales when the iPhone 6 and 6 Plus officially went on sale in its initial rounds across developed markets throughout late September. The company will likely raise eyebrows again this weekend when its iPhones will become available for preorder in another critical market for the world's largest publicly traded company: China.

Apple's next must-watch launch date
This Friday, Oct. 10, Apple will officially begin accepting preorders for the iPhone 6 and 6 Plus in China, with actual shipments starting one week later on the 17th. This is important for several reasons. 

Under the supervision of CEO Tim Cook, Apple has made significant inroads into the high growth Chinese smartphone and tablet markets, a trend that will only accelerate in the years to come. Thanks to its cache as a status symbol, Apple's high-end consumer-electronics devices have proven enormously popular. However, the iPhone 6 and especially the 6 Plus are likely to prove significantly more popular than other devices in Apple's product portfolio in China for one key reason: screen size.

Chinese smartphone users absolutely love large-screened smartphone, colloquially referred to as "phablets." Case in point, 40% of Chinese smartphone sales in the month of March were attributed to devices with screen sizes of five inches or larger. Thankfully for Apple and its shareholders, the iPhone 6 Plus, with its 5.5 inch screen, is a device that perfectly situates Apple to take advantage of this growing preference among Chinese consumers. The Apple iPhone 6 and 6 Plus were likely to prove resounding successes in China because of the aged state of Apple's iPhone installed base in China, and the inclusion of the larger 6 Plus in Apple's latest iPhone refresh only further stacks the deck in Apple's favor.

Not without its risks 
The accepted dogma for this storyline holds that the Apple iPhone 6 and 6 Plus will prove successful in China (and globally for that matter). However, there are several key potential mitigating factors anyone following the company will want to consider.

The first is price. For a developing country where per capita incomes remain relatively low, the Apple iPhone 6 and 6 Plus are by no means cheap. And, it's also no secret that additional costs like import taxes help drive up the cost of Apple's highly sought-after iDevices to levels well above their sticker price in developed markets. The 16GB version of the iPhone 6 will retail for roughly $860 (RMB 5,288), and the presumably more popular iPhone 6 Plus will cost around $990 (RMB 6,088). This is by no means cheap. However, also noting that the memory structure of Apple's new iPhone lineup (16, 64, and 128MB models) heavily incentivizes paying up for memory, the average cost of a new iPhone in China could easily sit somewhere above $1000, making it largely unobtainable for all but the richest Chinese citizens.

The second issue also relates to price for Apple's new iPhones. In a bid to support China's budding domestic smartphone makers, the Chinese government has been attempting to reduce the amount of subsidy support its domestic telecom companies can offer for highly popular foreign handsets like the iPhone. Such moves would help remove one of the critical tools Chinese telecom companies have to help reduce the overall sticker shock for consumers.  

Despite these potentially dampening risk factors, the Apple iPhone 6 and 6 Plus are poised to quickly become Apple's best-selling iPhones ever in China when they launch later this month, and investors are undoubtedly aware of this. As such, anyone even casually interested in the iPhone 6 storyline will want to pay close attention to Apple's commentary on the relative strength of this weekend's presales figures. Apple's and its iPhone 6 and 6 Plus certainly have their work cut out for them in the world's largest smartphone market. However, I'm certainly a believer it's more likely than not that Apple will once again impress investors and the market as these key upcoming dates approach.

Ancillary revenue has become a major part of airline industry revenue, but few realize just how important it is to airlines. In a previous article, Fools learned about how ancillary, or add-on, revenue is defined and which airlines are the biggest revenue generators. Unsurprisingly, the budget/discount airlines rely on ancillary revenue the most, but traditional airlines such as United Airlines are increasingly relying on it, too. Let's take a look at some industrywide figures that help explain the importance of this revenue to airline profitability, and at who is doing what.

Source: Motley Fool Flickr account.

Growth of ancillary revenue
It's hard to put an exact figure on industrywide profitability from ancillary revenue, because not all airlines disclose the data and/or break out profits generated from ancillary revenue. However, it's safe to assume that activities like baggage checking, seat allocation, booking fees, and on-board entertainment are high-margin activities. With this in mind, here is a comparison of industrywide ancillary revenue, garnered from The CarTrawler Yearbook of Ancillary Revenue by IdeaWorksCompany, versus estimates for airline profitability.

The data tracked only 59 of the largest airlines in 2013, but the net profit estimates are far wider in their coverage. In other words, the real amount of ancillary revenue is higher than the data suggests.

Source: CarTrawler Yearbook of Ancillary Revenue, IATA website.

To put these figures into further context, the IATA forecasts that net profit per passenger will be $5.65 in 2014, while industrywide ancillary revenue per passenger (from the data charted here) was forecast to be $16 in 2013. It's fair to say that without ancillary revenue, a lot of airlines wouldn't be profitable.

Moreover, increasing ancillary revenue is clearly a large part of airlines' growth strategy, and the stock markets have woken up to it. The latest airlines to introduce checked-bag fees include Air Canada and WestJet Airlines (and both stocks rose on the day of their respective announcements), while even JetBlue Airways Corporation is reported to be considering how to increase non-ticket revenue.

Airlines with growth opportunities
In a previous article, readers saw that United Airlines is the leading revenue generator by total revenue, and also the leading traditional airline in terms of revenue share from ancillary sources (14.9% in 2013), with ancillary revenue of $41 per passenger. Just over half of this revenue comes from miles sold via its frequent flier program, but even excluding that, United is still generating around $20 per passenger -- a figure notably above Delta Air Lines and Southwest Airlines , at just about $15 and $12, respectively.

The implication is that Delta and Southwest have an opportunity to play catch-up to United, and investors should look out for this in their statements. Meanwhile, budget airlines such as Spirit Airlines and Wizz Air generated 38.4% and 34.9% of their revenues from ancillary sources in 2013. It's harder to see how Spirit and Wizz Air can significantly improve their ancillary revenue per passenger, especially as the figures are already more than $51 and $34, respectively.

The bottom line
All told, ancillary revenue has become a key profit and revenue growth driver in the airline industry. The trend is upward, and investors should look at airlines like Delta and Southwest for their potential to increase ancillary revenue in the future. In a sense, these fees and charges allow airlines to differentiate pricing to customers-- helping airlines keep ticket fees down for customers who can avoid paying certain ancillary fees. This is good news for customers

It's also good news for airlines, as it could help keep load factors (a measure of the capacity utilization in terms of seat-kilometers) stay high in the industry -- there are fewer things that hurt airline profitability more than empty planes. Ultimately, investors can look forward to airline stocks that are trying to increase this source of revenue in the future. 

Courtesy: Starbucks

Loyalty-focused smartphone apps have become pretty much a standard among big consumer brands and most of these apps are pretty much the same. However, there are reasons that customers actually love Starbucks' mobile app, and why the app has been the most successful in the industry. For the reasons below, it will probably continue to be the most successful for a long time. No other business can really compare to how well Starbucks is integrating its app into its business model, and the new additions to the app will continue to make it the best app of its kind out there. 

Mobile payments that just get better and better
Starbucks didn't invent mobile payments, but it was one of the first companies to make them widely successful as a day-to-day function for consumers. The Starbucks app was launched back in 2009, and started accepting mobile payments in 2011. Starting with the bar code scanner placed at the register of only a select few stores around the country, which decreased waiting times and made payments incredibly easy, Starbucks grew the service to the incredible numbers it posts today. Now, the Starbucks app processes more than 6 million payments per week in the U.S., which accounts for 15% of the total transactions of the coffee chain, and is on track to process over $1.5 billion in sales in 2014, according to an estimate from Business Insider.

With the introduction of Shake to Pay, customers who are already on their phones checking emails or reading news while in line for their coffee, can then simply shake their phone to pull up the barcode of their Starbucks Card to pay for their coffee and snacks. Shake to Pay for iOS was announced in March; it launched on Android last month. The app also started allowing customers to tip their Starbucks barista directly from the app with a simple click following the payment. By looking at how customers were interacting with their device while in the store, Starbucks found ways to improve its payments app.

The Starbucks mobile app with tipping. Courtesy: Starbucks

Happening now: More customer and partner integration
Now that nearly every company is following this lead with in-app payments and customer loyalty programs, how is Starbucks continuing to stay ahead of the tech curve? The answer is: total customer integration. This means giving people more options within the app to make their time at Starbucks easier and more enjoyable. This includes features like pre-ordering and pre-paying to have your drink waiting for you to pick up, as well as instant downloads of your favorite newspaper just as you are getting your coffee to sit down.

Starbucks is even teaming up with other companies, like the car-ride service Uber, to offer even more expansive experiences through the app. In fact, you could even say Starbucks is creating a kind of VIP experience for its customers. Straight from the app, you can order your black car service to pick you up and take you to your local Starbucks, where your drink is already waiting for you when you arrive since you've ordered and paid ahead of time through the app. It will also have your favorite daily newspaper loaded on your phone ready to read along with your coffee, and then have your private driver return you home, all without ever leaving the app. Now that's the kind of app that stands out.

What to look for in the next few quarters
Shake to Pay and mobile tipping were the big releases of the early part of the year. Then integration of Uber and other company partnerships were introduced at the beginning of the fall. What will be the next big innovation? It's hard to say, but given the track record, it's likely that there will be more app innovations announced in the next few quarters.

Through MyStarbucksIdea.com, customers and Starbucks-app lovers have a forum to submit and share ideas to make the Starbucks experience better. This isn't limited to the Starbucks' app, but it allows tech-forward consumers to discuss and even vote on what tech innovations Starbucks can make to keep customers loving their Starbucks experience, meaning there will be a wealth of ideas for app developers to work with.

And if it's not directly related to new features, it might be about new areas of monetization. There have reportedly been discussions of Starbucks licensing its app technology for other companies to use with their own brands. With the success of the Starbucks app so far, there could definitely be other companies willing to pay major sums to get the same advantages.

Foolish final buzz
Starbucks is the industry leader for many more reasons than just its great app, but the app is certainly one very good example of why Starbucks is such a strong company. The app shows Starbucks' commitment to innovation and forward-looking customer integration. As was true with the array of new features added in the last few quarters, customers and investors should expect to see more headlines in the coming quarters on how well the Starbucks app continues to do. Whether that means more features, more integration, or even licensing the technology, I expect continued app development will be a good thing for Starbucks customers and investors alike.

Russia is once again pushing the envelope on the world stage. The United States and its allies have placed increasingly stringent sanctions on the country to try to change its ways. So why was New Hampshire's largest utility so desperate for fuel that it did a deal with the country anyway?

No comment
When Bloomberg contacted Public Service of New Hampshire about the purchase of nearly 40,000 tonnes of thermal coal from Russia for its Schiller power plant, the response was, "A shipment of coal was contracted from Russia that met our operational and economic needs." That terse reply is hardly surprising given that the United States is one of several nations imposing sanctions on Russia for its involvement in Ukraine and annexation of Crimea.

(Source: Richard Freeman, via Wikimedia Commons)

For the most part, those sanctions have targeted the oil industry. But Russia is no slouch when it comes to coal, holding the world's second largest reserves of the cheap, but dirty, fuel. That said, the United States has the world's largest reserves, roughly 50% more than runner up Russia. There's little doubt that coal is out of favor domestically, but why would New Hampshire do a deal with a country that we are trying to isolate when there's plenty of coal on its home turf?

Would you believe that answer is trains? U.S. coal miners like Peabody Energy , Arch Coal , and Cloud Peak Energy would love to sell New Hampshire the coal it needs, but it can't because of delivery delays on the rails. Although it's more complicated than this, the basics of the situation are that the extra cold winter last year caused rail problems that have yet to be resolved.

In fact Peabody Energy CEO Gregory Boyce noted in his company's second quarter conference call that, "We estimate that 15 million tonnes of [Powder River Basin] shipments have been missed in the first half of the year due to the low power rail performance and utility coal conservation measures due to inadequate deliveries." This despite the fact that utility stockpiles of coal from that low-cost region were down 30% year over year, "a dramatic improvement over the last few years as the inventory overhang has been removed."

In other words, coal should be doing better. Only Peabody spokesman Vic Svec points out a tiny problem: "While utilities are relatively low on supplies they're not bidding into a market for coal they can't get delivered." Seriously, why buy something you can't get? Instead, utilities are being forced to cut back on coal use to help ensure they have enough to last the upcoming winter! That, by the way, is increasing their use of natural gas, which in many cases costs more to burn—keep an eye on your electric bill; it might be going up.

(Source: Public domain, via Wikimedia Commons)

Other sources
So, New Hampshire's deal with Russia is basically a way to get fuel that it couldn't get domestically. And even though it required working with a country that's on the verboten list, ensuring the lights stay on throughout the winter basically required working with the "enemy." Not ideal, but you do what you have to.

Interestingly, however, Peabody Energy provided a coal market update in mid-September that was notably upbeat. "Powder River Basin demand remains strong as it is competitively advantaged to natural gas generation at gas prices above $2.50 to $2.75/mmBtu, and improving rail performance is expected to result in higher Powder River Basin demand in 2015." Moreover, "Based on recent transactions, Peabody is now signing Powder River Basin contracts at materially higher levels than published indices that are not reflective of physical markets."

So at the very same time that there's blood flowing on Coal Miner Street, Peabody is starting to talk about things getting better for the Powder River Basin (PRB). That's good news for Peabody, though it has notable exposure to the weak metallurgical coal market, too, which will keep results weak.

Cloud Peak, however, only mines for coal in the PRB. And while it lost money in each of the first two quarters as rail delays took their toll, it had managed to stay in the black prior to that despite the broad industry downturn. Cloud Peak could be worth watching here.

New Hampshire's Russian deal shows coal is not out of the woods yet, but if you can stomach buying when everyone else is scared, now could be a good time for a deeper dive in the unloved coal sector.

Manchester United has been weak in the field and in the stock market this year. On the field, the Premier League soccer team had a slow start to the season after last year's seventh-place finish. The stock is up slightly in 2014, but it is down 6% over the last 12 months. One billionaire fund manager has raised his stake in the team even as the majority owners of Manchester United lower theirs. Read on to find out why Ron Baron is betting big on Manchester United.

Source: Manchester United.

Baron is CEO, CIO, and portfolio manager of Baron Funds and Baron Capital Management. He is a noted growth fund manager whose Baron Growth Fund has returned cumulative average growth of 13.7% since its inception in 1994. The people at Baron Funds are long-term buy-and-hold growth investors with an average holding period of seven years.

According to the firm, Baron invests in businesses with business models that can't be challenged and that feature big growth opportunities while having a value-oriented purchase discipline based on what they believe the company can earn over the next three to five years. His philosophy also stresses thinking long term and investing in management teams with integrity and similar long-term mind-sets; this is encompassed in his firm's mission statement: "we invest in people." Finally, Baron Capital emphasizes exhaustive research to understand businesses, management teams, and industries, and to manage risk.

A few weeks ago, Baron Capital Group revealed that it had upped its stake in Manchester United to 15,026,190 shares. That's 37.8% of Manchester United's publicly traded shares, or 9.2% of the company overall. Currently the company has 39,777,957 Class A shares, which each get one vote and are publicly traded. Another 124,000,000 Class B shares are not publicly traded and carry 10 votes each. So why has Ron Baron bought so much of Manchester United? Based on his investment philosophy, I believe three things attract him to the company.

1. "We invest in people"
The Glazer family has owned Manchester United since 2005. Most of its ownership is held by a holding company called Red Football, though various family members have stakes held in irrevocable trusts. The Glazers own 124,000,000 Class B shares and 11,000,000 Class A shares, leaving the family with majority control, 82% of the economic rights, and 97.7% of the voting rights. How has the family done as stewards of the company?

The family had it relatively easy on the field for a few years as legendary manager Alex Ferguson led the team until the end of the 2012-2013 season. From 2005 he led the team to at least a top three finish every year, including four Premier League titles, a league cup win, and a title and two second-place finishes in the Champions League. After Ferguson's retirement, last season Manchester United hired David Moyes, who was sacked after he led the team to a seventh-place finish, missing out on qualification for European competition. The club has now invested considerable sums in players and a new coach to resume its winning ways.

Off the field, the Glazers have been paying down the debt they used to purchase the team. More important, the family has increased and diversified the club's revenue streams -- particularly its commercial revenue, which has gone from 27% of the team's overall revenue in 2007 to 42% last year.

Source: Manchester United.

The Glazers have done this by using Manchester United's strong brand to their advantage, which brings me to the second reason Baron is betting big on Manchester United.

2. "Business models that can't be challenged"
Soccer is unquestionably the most popular sport in the world. Manchester United claims it is the most-watched sports team in the world, with an estimated average live audience of 47 million people per game and a total of 659 million fans globally.

Manchester United is using that fan base to reap the largest sponsorship and licensing deals the world has ever seen. Beginning this season,General Motors'  Chevrolet is paying $70 million annually through 2021 to be the team's jersey sponsor. That's well over double the price some of the world's other most popular soccer teams are getting from their shirt sponsors.

Source: Manchester United.

This year, Manchester United also signed a 10-year deal with Adidas, starting at the end of this season, to handle the team's wholesale retail, merchandising, apparel, and product licensing. The contract stipulates that Adidas will pay Manchester United a minimum 750 million pounds over the life of the contract. At current exchange rates that is over $1 billion over 10 years, a price that was too high for current kit sponsor Nike to accept.

Source: Manchester United.

The deal also stipulates that Manchester United will retain rights to its own retail stores, e-commerce site, monobranded products, and soccer camps.

3. Big growth opportunities
One key reason that cable cord cutting has not become a bigger trend is live events and sports programming. The value of sports content is high and rising. For instance, ESPN costs your cable provider 40 times as much as the average cable channel to provide to you. The value of contracts to broadcast the Premier League and Champions League are on the rise, and are expected to rise further after the current deals lapse in 2016 and 2018.

Source: Manchester United.

With the number of people watching soccer continuing to grow, especially in the U.S., the clubs that will benefit from the increased viewership the most are those with the strongest performance on and off the field. There's a virtuous cycle as the clubs with the best off the field performance can invest in better players, enabling the club to perform well on the field, and bringing in a disproportionate number of new fans as more people start following the sport.

As long as Manchester United can resume its winning ways, the club's off-field financial performance should reward shareholders for years to come.

Everyone knows that cable companies like Comcast and Time Warner Cable are some of the most reviled companies around.Is it because of the slow Internet speeds? Is it the huge monthly bills? Is it because the average American has just one, maybe two, choices between cable companies in their area? Regardless of the reason, the verdict is in and American consumers are less happy with the cable industry than almost any other. But are consumers being fair?

In this episode of Where the Money Is Motley Fool Consumer Goods Analysts Nathan Hamilton and Sean O'Reilly dive into just how balanced American consumers are with their feelings toward cable companies despite the fact that cable company products are better than ever and hundreds of billions of dollars have been spent to bring customers better cable packages and high speed Internet connections. 

For the past 2 years, Apple has hosted separate events in September and October, spreading out product unveilings over the course of those months and dominating headlines and media coverage. October 16 is the date this year to mark on the calendar.

There are some obvious candidates of what to expect at the event, but there's also room for speculation about other products that Apple could show off. Let's start with the most likely headliners.

New iPads
Apple shifted its iPad product cycle in 2012 to fall releases. That was the year that Apple introduced the first-generation iPad Mini. Ever since, Apple has unveiled new tablets in October, and as such should do likewise this year with a new iPad Air and new Retina iPad Mini. Both new models are expected to get Touch ID sensors integrated into the home button, after the technology was introduced in the iPhone lineup last year.

The iPad Air 2 is expected to have a very similar overall design to the current iPad Air, with only minor changes. Apple could add an anti-reflective coating to the display in order to make it easier to read in direct sunlight. Apple is rumored to be adding a gold color option to the lineup this year as well, which would mirror the iPhone portfolio, which would mirror the iPhone portfolio. Spec bumps like a faster A8 or A8X processor and potentially more RAM could also be in store.

For the most part, the second-generation Retina iPad Mini is also expected to get most of the same upgrades as the iPad Air 2, with little if any design changes. However, there is a possibility that the second-generation Retina iPad Mini will be delayed until early 2015.

Code found within the iOS 8.1 beta that was distributed to developers hints that Apple will facilitate Apple Pay in the new iPad models. While the new iPads are not expected to carry NFC chips for use at retail locations (who carries around their tablet all the time?), Apple Pay will enable developers to accept payments in their apps as well as online purchases.

There has been considerable speculation that Apple is preparing to release a 12.9-inch "iPad Pro," but rumors suggest that this product will be unveiled in early 2015, if at all.

OS X Yosemite
The next major version of Apple's desktop operating system will almost undoubtedly launch this month. Announced this summer at Apple's developer conference for availability "this fall," OS X Yosemite features a massive aesthetic makeover that resembles iOS. Apple has already detailed all of the major new features in OS X Yosemite, so there aren't likely to be any surprises as far as features go.

Technically, the primary unknown with OS X Yosemite is the specific timing of the release. The company has already released the "golden master candidate" version of OS X to developers and participants of its public beta program, which is the final version before it is ready for widespread distribution, so the release is imminent.

With new iPads and OS X Yosemite all but certain for an October launch, let's turn to the products that are less certain.

Retina iMac
Apple has reportedly been working on a high-resolution version of its all-in-one iMac desktop. Hints of the "Retina" iMacs were first spotted this summer in early beta versions of OS X Yosemite.

The company may increase the resolution of the 27-inch model from 2,560 x 1,440 to a 5,120 x 2,880 panel, following its "Retina" strategy of doubling pixel dimensions. That would classify the display as a "5K" display. The smaller 21.5-inch model is expected to keep the same resolution.

The desktop is expected to feature high-end Intel Haswell processors as well as state-of-the-art AMD graphics. That would represent a switch in discrete graphics chips providers, as NVIDIA is Apple's current vendor.

Mac Mini
One of the least loved products within the Mac family is easily the Mac Mini, which hasn't been updated in 2 years. Sitting at the lowest price point for Macs, it makes sense why it gets the least attention from Apple. That being said, it's about time to update the smaller desktop.

Not much else is known about the possible Mac Mini refresh, but it stills seems entirely possible that one will take place this year considering the aging internals of the current models.

After shelving plans to sell off its PC business a few years ago, Hewlett-Packard has changed course with the announcement this week that it plans to break itself into two companies. HP will be comprised of the company's printing and PC business, while Hewlett-Packard Enterprise will sell enterprise hardware, software, and services to business customers.

The split makes sense for HP, which has been struggling to grow, allowing each new company to focus on its core business. For HP investors, the split also makes sense, since the total market capitalization of both new companies will likely be higher than that of HP today. This breakup has a very good chance of unlocking value for shareholders, and here's why.

Old vs. New
Here's a breakdown of HP's segment revenue and operating profit during fiscal 2013:

Source: HP  

In terms of revenue, both new companies will be roughly the same size. The segments comprising Hewlett-Packard Enterprise generated more operating profit during fiscal year 2013 at a higher margin, but both companies will earn billions of dollars annually once the separation is complete.

How will this separation create shareholder value? Let's consider HP first. HP will be about the furthest thing from a growth company one can imagine. Printing has been in decline for quite some time, and the business doesn't appear to be stabilizing any time soon, and the PC market, while stronger than it's been in the past few years, is still expected to slowly shrink over time.

But HP's printing business is a cash cow, with operating margins in the mid-to-high teens. The business of selling ink and supplies to buyers of its printing hardware remains a lucrative one for HP, and it will continue to earn HP plenty of money even as it declines.

PCs are much lower margin, but they still contributed about $1 billion in operating profit in 2013. HP is the second-largest PC vendor in the world, and the more focused HP will be better-suited to compete with Lenovo Group in the PC market without being tied to the enterprise business.

While there are some growth prospects for HP, such as 3-D printing, I wouldn't bet on much growth from the company. A valuation for HP similar to that of HP today would seem reasonable, although if HP pays a strong dividend, investors could flock to the stock. HP could easily afford to pay what HP pays today in annual dividends, about $1.2 billion per year, leaving plenty left over for investments in 3-D printing and other areas. If HP becomes a dividend stock, it could very well command a higher valuation.

Enterprise bound
Hewlett-Packard Enterprise will look a lot like IBM, focused solely on enterprise hardware and supporting software and services. IBM got out of the PC game a long time ago, and Hewlett-Packard Enterprise is now making a similar, albeit belated, move.

HP Enterprise likely deserves a higher valuation than HP has today since there is at least some potential for growth. The low-margin PC business will no longer be holding the company back, and the potential to increase the profitability of the enterprise services segment, which has abysmally low margins, could give a nice boost to earnings. Removing the two segments that have tended to decline over the past few years will make it much easier for HP Enterprise to grow revenue, and its higher operating margin compared to HP today could lead to a higher valuation.

HP Enterprise does face some serious threats, however, that could derail the success of the breakup. Lenovo recently closed the deal to buy IBM's x86 server business, and the company is aiming to steal enterprise hardware market share away from HP. This could lead to lower margins in the server business, and that would be detrimental to HP Enterprise's bottom line.

HP Enterprise, though, will be better-suited to deal with the threat once it sheds its consumer-facing parts, and Lenovo will certainly have a more difficult time competing against a company that is solely focused on enterprise customers.

Final thoughts
The move to break up HP makes a lot of sense, and it has the potential to unlock some shareholder value. HP has never been a particularly good dividend stock, but post-split HP will earn more than it knows what to do with, and paying a solid dividend is a good way to make the stock look more attractive despite its lack of growth potential. HP Enterprise, now unburdened by PCs, can focus on protecting its server market share and growing its services business. A higher valuation than HP has today is possible, and I suspect that investors will ultimately benefit from HP's breakup plan.

We Americans are getting addicted to our high-speed broadband connections. Unfortunately, they are often slower and more expensive than the Internet hook-ups you can grab in many other developed nations.

For example, my brother pays $40 a month for his 100-megabit broadband connection in Karlstad, Sweden. He can take his pick from 19 different service providers, all using a common last-mile infrastructure and competing on price and features. For $70 a month, he could upgrade to a full gigabit.

Me, I'm stuck paying $83 a month for a 50-megabit connection. Moreover, my upload connection rarely goes past half the speed Verizon (nyse: vz) promised. So I'm paying more and getting less, and if I wanted Verizon's fastest available FiOS connection, I'd be paying $300 a month (plus taxes!) for half a gigabit.

It's pretty clear that the Swedish model delivers more value and lower prices than the American way. And it's all made possible by a robust collection of municipal networks.

So why isn't America following the municipal path to high-speed bliss?

... it's complicated
Here's what happened in Sweden, in a nutshell.

As the 1990s drew to a close and the Internet started to become a big deal, Swedish consumers and businesses started thirsting for faster and more reliable connections. An industry emerged to serve this unmet need, much like anywhere else.

But there was a problem. Formerly government-owned telecom giant Telia had already installed a nationwide fiber-optic network and was unwilling to share network access with other operators. One by one, county and municipality leaders started drawing up their own plans for local high-speed networking -- and reaching out to one another to connect the separate networks into a nationwide loop.

This began with the larger cities, before spreading to suburbs and downright rural areas. Encouraged by the success of local leadership projects, the Swedish government started pumping additional funds into this expansion -- and regulating the newborn industry.

Take government funds, and you'll have to commit to opening up the network for others to use. This is crucial.

The fiber expansion is still going on, and slowing down as the return on investment shrinks when the fiber stretches into thinly populated markets. But slowing down is not the same thing as stopping development altogether.

Today, 57% of Swedish households have access to 100-megabit broadband services. Nearly 200 of Sweden's 290 municipalities offer a so-called city network, under public or private ownership but conforming to the same open-access principles.

The government aims to reach 90% of the population with 100-megabit broadband by 2020 and has approved $500 million of funds to support rural expansion over the next six years. Moreover, each one of the nation's 21 counties has a separate budget to coordinate these broadband expansion efforts.

City networks: Orange = municipal, black = private, gray = missing. Source: SSNF.org

The Swedish model today
That's the history and a snapshot of the current situation. The end result is that a majority of Swedes have direct access to a broadband infrastructure that was developed, funded, built, and supported by local and national government bodies. In a few places, the local electric power utility has played some or all of these roles -- but these tend to be run by the government anyhow.

This last-mile infrastructure and the connecting fiber loops are accessible to a variety of telecoms, cable service providers, and Internet specialists. All of them have equal access to the consumer-facing and core networks, on "equal and non-discriminatory terms."

The companies and government agencies that built these networks to begin with often sold consumer services at first. Today, that's incredibly rare, as third-party service operators have come to dominate the end-user market. Intense competition between them forces prices way down and gives the service providers incentive to develop new selling points for the same basic network access.

But again, all of these benefits spring from open access policies, where anybody can compete on equal terms.

And therein lies the rub.

This is why we can't have nice things!
The American broadband infrastructure grew from a very different place.

First, Sweden is about the size of California, with the population of North Carolina. With about 24 citizens per square kilometer, compared with America's 35, the population density is much thinner. Kind of like a scaled-up version of Mississippi.

The economic challenges of criss-crossing Sweden with fiber-optic broadband are very different from covering the New York cityscape or the big-sky vastness of Wyoming. But that's just a huge math problem, and not the biggest difference.

The real game-changers are political in nature. Funding and building a coast-to-coast broadband network would meet massive resistance in the tax-averse American market. And if tax dollars went into building the darn thing, why would the government then turn the network over to others, rather than drawing a profit from the huge investment?

Now, the early days of the Internet itself saw two American backbone networks develop much like the Swedish municipal networks are doing much later. The early ARPANET and NSFNET networks were built and operated by government agencies, before merging and then getting privatized in 1995. The commercial core network operators that emerged then still run the show today as Tier 1 networks, alongside a few later additions.

But things were different back then. Way different.

When commercial forces took control of America's Internet backbone, about 16 million global Internet users surfed 19,000 websites on primitive browsers like NCSA Mosaic, Netscape Navigator, or the text-based Lynx.

Today, 3 billion Internet users worldwide use smartphones and modern browsers to access over 1 billion websites -- and a ton of content available only to specialized apps.

The core network is no longer serving up a trickle of text and simple graphics to a microscopic niche market. The Internet has gone mainstream, including bandwidth hogs like online video and digital health services.

So the game has changed, while the fundamental business model hasn't. Commercial interests have built out the backbone networks we use today, and they rightly expect to see a decent long-term return on their investments. It's not about serving the community with low-cost, high-quality services. Serving investors sets up a very different incentive structure.

It all comes down to this:

The Swedish model is using public funds to create an Internet service that provides consumers and local businesses with affordable and powerful services. Turning a profit is a secondary consideration, if at all. This is true on several levels, from the nationwide backbone to local last-mile services.

The American model is powered by private, for-profit organizations. On the next level down, consumers are facing a Balkanized patchwork of cable, fiber, and DSL services with minimal competition and zero infrastructure sharing. Flooding or overriding this system with government support would be politically impossible, so we're stuck with this framework. That means focusing on profits over service quality, and there is no incentive at all to lower the cost to consumers.

Final words
The American status quo could still change, but not easily. Google   Fiber is throwing a wrench in the monopolistic pricing tendencies, as local telecoms and cable companies tend to introduce cheaper and faster Internet services wherever Google's services pop up.

Increased competition brings price pressure. Sweden has a lot of it, thanks to an open infrastructure and low profit expectations. American consumers have very little, for a variety of political and historical reasons. Google Fiber and similar upstarts can narrow the gap a little bit, but never the twain shall meet.

Grant Gustin stars in the series premiere for The Flash. Credit: The CW/ DC Entertainment.

Time Warner adds another element to the DC television universe tonight when The Flash premieres at 8 p.m. Eastern on The CW. Arrow returns for season 3 tomorrow night, adding to a DC Comics-influenced television lineup that already features Gotham on Fox. A fourth show, Constantine, is scheduled to premiere on Friday, Oct. 24, on NBC.

Interestingly, the build out isn't confined to TV. DC is also tightly integrating its programming with its comics. Whereas Marvel is winning mainstream audiences, DC is profiting by appealing directly to fanboys and fangirls.

A strategy straight out of the comic books
This isn't luck of the draw so much as a business strategy at work. While Disney is betting on Marvel Studios to produce action movies with mass market appeal, Warner is taking an integrated DC universe straight to comic book fans with the help of Arrow co-creators Andrew Kreisberg and Marc Guggenheim.

Kreisberg is writing Green Arrow with Ben Sokolowski. He also co-wrote the three-part The Flash: Season Zero miniseries, a digital prequel to tonight's premiere. Guggenheim scripted Arrow: Season 2.5, another three-part digital prequel. In a press release issued last week, DC said the titles "launched to great fanfare and sales" (via Comic Book Resources).

Marvel didn't release a similar preview for Marvel's Agents of SHIELD, which earned lukewarm ratings in returning two weeks ago. Specifically, SHIELD debuted to 5.98 million live viewers and a 2.1 rating in the key age 18-49 demographic -- in each case, sharp declines from last year's series premiere. Episode 2, "Heavy Is the Head," drew 5.05 million viewers for ABC.

By contrast, Nielsen said season 2 of Arrow pulled in an average of 3.28 million viewers to The CW, numbers that could improve when season 3 begins on Wednesday night. Social data puts Arrow second behind The Walking Dead on the comic book TV buzz-meter:

Mighty Marvel's strength is also its weakness
Why isn't Marvel using comics to boost Agents of SHIELD? Probably because Disney doesn't need AoS to be anything more than a marketing vehicle, as it was for Captain America: The Winter Soldier. A follow-up tie-in to Avengers: Age of Ultron seems likely, further fueling a franchise that has produced over $7 billion in worldwide theater ticket sales and an estimated $1.5 billion in gross profit. DC can't touch those numbers.

And yet I'm not sure it matters. After all, DC's television strategy is to use Arrow and The Flash to introduce a whole range of characters who exist in the DC universe but haven't enjoyed much (or any) screen time. Robbie Amell, brother of Arrow star Stephen Amell, will bring Firestorm to The Flash. Brandon Routh will bring the Atom to Arrow, which is also due for a movie tie-in of sorts when the assassin Ra's al Ghul makes an appearance. (Liam Neeson played the role in Batman Begins and The Dark Knight Rises.)

For DC and Warner, the variety of introductions could inform new stories that extend into the comics and boost sales there. At the very least, it creates an interconnected experience that is bound to be appealing to readers like me.

Look at Arrow. Last year, writer Jeff Lemire inserted actor David Ramsey's character, John Diggle, into the Green Arrow comic series. Kreisberg and Sokolowski introduced Emily Bett Rickards' character, Felicity Smoak, in the latest issue. Don't be surprised if DC follows up by announcing new comic book tie-ins to Gotham and Constantine at New York Comic Con, which starts Thursday at the Javits Center in Manhattan.

Disney and Marvel deserve all the kudos they're getting right now. But this is DC's week, and by the looks of it, it's going to be a big one.

Arrow, The CW's highest-rated show, kicks off season 3 on Wednesday night. Credit: The CW.

It's hard to make a case against United Continental Holdings , but in the interest of a more balanced view to go with my previous bullish article, I'm going to give it the old college try. Aside from the historical enormous volatility across the entire airline industry in terms of both fundamentals and stock prices, United Airlines may have a few warts unique to itself that you should keep an eye on. Here are three concerns.

Source:  United Airlines.

Concern 1: Ebola is no laughing matter
As Fools, we strive to educate, amuse, and enrich, but the subject of the deadly Ebola virus is no joke. There has been already at least one scare involving a passenger who flew two connecting United flights. He exhibited signs of the disease and was ultimately cleared, thank goodness, while the company rushed to contact "several hundred" passengers who were on the same flights.

But the incident reminds us how sensitive the public is to flying risks, and one of those risks is contracting disease. Often when something happens to a particular airline, even through no fault of its own, it ends up with a paranoid public and a negative image that ultimately hurts sales and profits. With United Airlines being the second biggest airline, there is a very real risk of further incidents and possible lasting damage to its reputation if further similar incidents occur.

The CDC says there could be as many as 1.4 million people affected worldwide by January with the Ebola virus. If so, that alone could keep many scared people out of the air and crowded spaces. That would affect the entire international airline industry, since people never know who sat on their seats before them and where those previous passengers were last. If nothing else, it may seem safer to stick with a regional airline.

Concern 2: Speaking of regional airlines ...
United Airlines is slowly getting out of the regional airline business. While the company is confident this is a wise strategic move aimed at greater long-term profits, there can be no certainty that will prove to be the case.

According to its most recent conference call, at the beginning of this year United Airlines had 8% of its overall capacity consisting of 50-seat and smaller aircraft. It is now targeting a reduction to 5% by the end of next year, with the hopes that the sacrifice of these revenues and profits will be made up for by easier overall logistics and ultimately lower costs for the rest of its planes sharing the same hubs.

Regional airlines such as Southwest Airlines , Allegiant Airlines , JetBlue Airways , and Hawaiian Airlines must be salivating. These four in particular have been rapidly growing sales and profits, and seeing United Airlines getting off their turf can only help them.

Is there perhaps a trend brewing involving travelers who prefer the smaller regional planes, perhaps for the ease of getting on and off and a better flight experience, at least among the public company players? Maybe United Airlines is making a mistake as it loses regional customers who may have later opted for trips on its bigger planes.

Concern 3: You might want to hedge your bets, since United isn't
All the talk in the world about fuel reduction, cost savings, and operational efficiency is great, but it might not have enough of an effect on United Airlines' ultimate cost: aircraft fuel. According to the company's SEC filings, aircraft fuel is the company's single largest expense. Luckily for United Airlines, oil and fuel prices have been in a tailspin lately, which makes things easier. For now.

The problem and concern is, what happens with fuel prices suddenly rise again? As of June 30, only 21% of its anticipated fuel requirements are hedged for the remainder of this year, 19% for next year, and less than 1% in 2016. As Fools, we tend to be long-term investors, and United Airlines isn't very well prepared in the near, medium, or long term for potential oil price shocks.

Perhaps even more concerning on that topic is the company's $2 billion in annual cost savings plan by 2017, which includes $1 billion in fuel savings. If United Airlines starts to fall shy of its stated goals, the temptation to reduce hedging and take a gamble may be even stronger as the market probably won't react too favorably to missed targets.

On that note, how can the company really give reliable guidance when it can't possibly know where fuel prices will be in the future, or if it isn't fully prepared to hedge against the worst? The vast majority of its go-forward fuel costs is wide-open exposed.

Foolish final thoughts
Overall, I'm a fan of United Continental Holdings stock, as I like what I perceive as a favorable risk-reward ratio, but there are very real risks and concerns that don't necessarily point to blue skies ahead. The airline business is already tough, and if just one thing goes wrong, sales or earnings could get pulverized.