Should real estate investors incorporate?

NEW YORK (Money Magazine)

The main reason to set up an entity like a corporation is to protect your personal assets against a lawsuit -- say, if someone gets injured on your property.

Instead of incorporating, though, Richmond real estate attorney Katja Hill suggests you set up a limited liability company, or several LLCs, to hold your properties.

LLCs are easier to maintain, she says, than the "S corp" corporate structure that's also used by small businesses.

Related: Finding financial planning professionals

A lender may make it hard for you, however, to move a mortgaged property to an LLC. A transfer might also trigger a tax hit (not likely in Virginia, but rules vary by area). In both cases, the best fallback for shielding assets is umbrella insurance. In fact, even with an LLC, Hill advises getting a policy to be extra safe.

Related: Was my home a good investment?

First Published: October 18, 2013: 4:18 PM ET

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Top investor not so bullish on Twitter

Twitter will soon go public. But will the stock actually do well? That's up for debate.

SAN DIEGO (CNNMoney)

Cohen, founder and CEO of leading startup accelerator TechStars, said he's a fan of Twitter. He'll probably even own a stake of it through one of the many funds he is invested in. But he suggested that Twitter's stock price may not rise too dramatically over the long-term.

The comments came during a conversation at the Stocktoberfest investing conference in San Diego Friday hosted by StockTwits. The social investing site's chairman Howard Lindzon asked Cohen whether he would take a long or short position on a certain companies.

Cohen said he would go long on Google (GOOG, Fortune 500), Nike (NKE, Fortune 500), Apple (AAPL, Fortune 500) and Facebook (FB, Fortune 500), but that he would hold, or go "not as long" on Twitter.

Related: Who'll be getting rich off Twitter

"Twitter needs to become more of a platform on the web," said Cohen in a follow-up conversation with CNNMoney. "If Twitter went away today, people would just turn to Facebook. If Facebook went away, people would start screaming -- it's so universal."

Cohen said Twitter has the potential to become a more essential web platform, but it's not there yet.

Though Twitter is not yet profitable, the company's user base and mobile business is growing. In fact, Twitter's monthly active users grew nearly 40% during the third quarter, and mobile ads brought in 70% of the company's total advertising revenue. But the key going forward will be whether Twitter can secure a steady revenue source without pushing users away.

Still, Cohen said he believes it's the right time for Twitter to go public. Twitter is slated to sell $1 billion in stock through an initial public offering next month.

First Published: October 18, 2013: 4:26 PM ET

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J.C. Penney shares close at 33-year low

Click for more data on J.C. Penney

NEW YORK (CNNMoney)

Shares of J.C. Penney (JCP, Fortune 500) fell nearly 5% to end at $7.01 a share. Earlier, the stock dipped below $7, a level not seen since 1980.

The rout was sparked by a market rumor that a Canadian financing company was denying J.C. Penney credit. It was the second time this week that J.C. Penney's stock was hit by an unsubstantiated rumor. On Tuesday, the stock plunged on talk the company was consulting with a bankruptcy firm.

J.C. Penney shares are down more than 60% so far this year due to concerns about sliding sales and mounting losses at the once mighty retail chain. But the company suggested that the recent spate of rumors are a ploy by short sellers to drive the share price lower in order to make a quick profit.

In a statement issued Friday, J.C. Penney pushed back against what it called "unprecedented attacks."

"These rumors are unequivocally false and constitute nothing more than attempted market manipulation by certain types of investors for their own personal gain," said J.C. Penney spokesman Joey Thomas.

The retailer added it has made "meaningful improvements" in its turnaround plan and expects to end the year with more than $2 billion in excess liquidity.

Related: Why J.C. Penney should go private

J.C. Penney recently raised $785 million in a secondary offering of 84 million shares. It also disclosed in a regulatory filing this week that it had reached an agreement with lenders to lengthen the maturity on an existing credit facility.

Still, 2013 has been brutal for the 111-year old retailer. The company ousted CEO Ron Johnson in April after his controversial overhaul of pricing fell flat with consumers.

In August, hedge fund manager and long-time J.C. Penney investor Bill Ackman jumped ship. Once the company's largest shareholder, Ackman lashed out at the board for not listening to his suggestion to replace CEO Myron Ullman, who returned to J.C. Penney to replace Johnson. Ullman was the CEO before Johnson, who left Apple (AAPL, Fortune 500) to take the top spot at J.C. Penney.

First Published: October 18, 2013: 3:11 PM ET

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Lamborghini reveals $4.5 million roofless car

The paint color on this car is a custom-made shade called "Rosso Veneno," but buyers can choose any color they like.

NEW YORK (CNNMoney)

While the car is priced at $4.5 million -- $500,000 more than the Veneno coupe -- it will actually be easier to get, provided you can afford it. Lamborghini's plans to build the car were announced in August.

Gallery - Lamborghini Veneno up close

That's because Lamborghini will produce nine of these cars during 2014. Production of the coupe was capped at just four, one of which is being kept at the Lamborghini museum.

The Veneno Roadster is not a convertible. It has no roof at all, only a roll bar for crash safety. The all-wheel-drive car is powered by a 750 horsepower 6.5-liter V12 engine and can go from zero to 62 miles an hour in just 2.9 seconds, according to Lamborghini. The car's top speed is 221 miles per hour.

The Roadster is made almost entirely from carbon fiber-reinforced polymers. Even soft interior materials are made from a woven carbon fiber fabric. Unike the Veneno coupe, which was available to the public only in three pre-determined color schemes, buyers will be able to choose their own paint colors for this car.

First Published: October 18, 2013: 9:59 AM ET

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Google shares soar past $1,000

Click the chart for more on Google's stock

NEW YORK (CNNMoney)

The stock surged 13% and rose as high as $1,007 a share, well above the stock's previous all-time high of $928 set in July.

Late Thursday, Google (GOOG, Fortune 500) reported earnings and revenue that blew past investors' expectations, driven by strength in the company's core search business.

The stock could head even higher, according to a raft of analyst reports published Friday.

Deutsche Bank was one of the most bullish, raising its price target for Google to $1,220 from $970.

Credit Suisse hiked its price target to $1,200 and Jefferies now thinks Google can hit $1,150 at some point over the next year.

Shares of Google are now up more than 40% this year. Amazingly enough, the stock has lagged the performance of two key rivals in 2013: Yahoo (YHOO, Fortune 500) is up nearly 70% while Facebook (FB, Fortune 500) has more than doubled.

Google is the second blue chip tech company to recently top $1,000 a share. Online travel site Priceline (PCLN, Fortune 500) became the first S&P 500 company to hit a four-digit stock price last month. Its stock is currently hovering around $1,050.

First Published: October 18, 2013: 10:39 AM ET

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5 stocks that could hike their dividends

Investors often chase stocks with the highest dividend yield. They should look for companies that can steadily boost their payouts.

NEW YORK (CNNMoney)

Dividend stocks are great because in addition to profiting from any upward moves in the stock price, the quarterly payouts sweeten the pot. Many investors also prefer to reinvest their dividends to buy more shares instead of taking the cash -- which can help the value of their portfolio grow further.

But investors who simply chase the stocks with the biggest dividend yields -- which is the annual payment divided by the stock price -- often get burned when dividends are cut or eliminated.

That's why you need to look for companies that have sustainable and growing dividends.

Here's how to find them.

Related: Don't let government drama derail your 401(k)

It helps to focus on rock-solid companies have very reliable cash flow. A simple screen to run on any potential investment is the percentage of profits returned to shareholders via dividends, or the dividend payout ratio. Simply divide annual dividends by the earnings per share and that tells you how much of the company's cash is going to investors and how much is going elsewhere.

A payout ratio that's too high may not give a company a lot of wiggle room to increase the dividend if earnings growth is sluggish. Take a look at Verizon (VZ, Fortune 500), for example. It pays $2.12 in annual dividends. That's a hefty 76% of projected earnings per share of $2.79 this year, according to estimates by Capital IQ.

Related: How to cash in on stock buybacks

Verizon's dividend yield is a very solid 4.5%. But the dividend itself has only increased by 37% over the past ten years. That's much lower than the dividend growth rates for other blue chips like Johnson & Johnson (JNJ, Fortune 500) and McDonald's (MCD, Fortune 500). And their payout ratios are lower than Verizon's.

Here are five more stable companies with low payout ratios, which should mean they can keep raising their dividends at an above-average clip for years to come.

• Apple (AAPL, Fortune 500) -- yield of 2.4%, payout ratio of 28%

• Cisco (CSCO, Fortune 500) -- yield of 3%, payout ratio of 32%

• Exxon Mobil (XOM, Fortune 500) -- yield of 2.9%, payout ratio of 33%

• Comcast (CMCSA, Fortune 500) -- yield of 1.6%, payout ratio of 32%

• Wal-Mart (WMT, Fortune 500) -- yield of 2.5%, payout ratio of 36%

Of course, a lot more goes into buying a stock than a low payout ratio. And none of these companies are guaranteed to increase their dividends -- especially in uncertain times.

But a company that has enough profits to use for dividend payments -- or for simply growing the business -- is never a bad investment. The best companies are able to do both.

Jeff Reeves is the editor of InvestorPlace.com and the author of "The Frugal Investor's Guide to Finding Great Stocks." Write him at editor@investorplace.com or follow him on Twitter @JeffReevesIP.

As of this writing, Reeves did not own any of the stocks named here.

First Published: October 18, 2013: 11:04 AM ET

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What debt crisis? Rally could keep going

Both the S&P and Dow have been on a tear in 2013.

NEW YORK (CNNMoney)

Answer: Probably nothing -- at least not for the next few months

"The amazing part of this whole situation was that investors were not going to let this rally go away," said Quincy Krosby, chief market strategist at Prudential. She noted that few investors were willing to take big bets against the market through short positions (i.e. investments that pay off when stocks fall) during the past month.

The Dow gained more than 1% since the government shutdown kicked off on October 1st. The index is now up 17% for the year and is hovering around its all-time highs. The broader S&P 500 is up nearly 21% in 2013 and is just a few points below last month's record high.

Related: JPM's Mary Erdoes: 'The really smart people will just buy stocks'

Wednesday night's debt deal will only give the U.S. a temporary reprieve from the drama that has consumed Washington for the past several weeks.

Still, analysts think investors will be happy to continue ignoring Washington for the next few months. Krosby said the market now has two rallying cries for the rest of the year: Don't fight the Fed. Don't fight the fourth quarter.

Stocks have rallied since the Federal Reserve announced it would not cut back, or taper, its bond buying program. And few expect the Fed to taper before the end of the year because of the uncertainty created by the government shutdown and flirtation with a bond default.

Related: Warren Buffett: Get the debt ceiling out of the picture

As for the fourth quarter, Krosby said it's typically one of the best times for stocks during any year. The market often rallies in November and December. This year, she expects stocks to do even better simply because hedge funds and mutual funds that have trailed the market will be forced to put money to work to catch up to the broader indexes.

Bruce McCain, chief investment strategist at Key Private Bank, also thinks stock will keep climbing. He doesn't believe they will continue to rise as quickly as they have for most of 2013. But he believes investors have already forgotten the debt scare.

"There's not a lot out there that seems likely to disrupt positive sentiment," McCain said.

First Published: October 17, 2013: 9:41 AM ET

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