The Motley Fool's Weekly Editors' Picks

Fools were out and about this past week in an investing world jam-packed with actions and ideas. Here are three articles you might find useful as you decide how to invest your money.

Another Sign Natural Gas Is Getting Hot
The United States Natural Gas ETF (NYSE: UNG  ) has benefited recently from a state of "backwardation," in which the price of futures contracts gets lower as the delivery date gets further in the future. This has come about as the price of natural gas has bounced back. "In fact, the natural gas market has been in a state of backwardation for most of July, and those who've rolled front-month contracts have earned an annualized return of 4.6%," reported Fool analyst Dan Caplinger.

But don't take this information to the bank. "Unfortunately for gas ETF shareholders, the futures markets aren't betting on backwardation lasting very long," wrote Dan. A state of "contango," in which near-term futures contracts are cheaper than longer-term futures, could be on its way back. "If contango comes back into the market, the U.S. Natural Gas ETF will once again start to erode investors' assets," wrote Dan.

Read the article for more insight on this exchange-traded fund and investing in natural-gas stocks.

Should You Buy on These Dips?
Fool analyst Dan Newman helps investors figure out what to do following earnings reports from some popular stocks. Starbucks (Nasdaq: SBUX  ) shares dropped after the company reported earnings, and Dan thinks this could be a good thing for those wanting to buy shares. "To me, it appears this sell-off just took the foam off of the top of a strong, underlying business," wrote Dan, noting the huge international opportunity Starbucks has. He also approvingly noted that Starbucks stores in the Americas are "being run even more efficiently, with operating margin increasing more than 1%."

Game maker Zynga (Nasdaq: ZNGA  ) disappointed investors with its quarterly report and a reduction in forecasts. "While there will be a bottom to Zynga's fall, the popularity cycle of its games requires too much investment to stay relevant," wrote Dan.

Read the article for more insight.

The Hidden Value Behind These 2 Dividend Stocks
Fool analysts James Early and Ron Gross had words of caution for investors inclined to read too much into certain quarterly reports. "I think the economy is in the process of outgrowing the notion of a bellwether," said James during the Motley Fool Money radio show. "It's so globally interconnected now. There are so many different things; you can read into results whatever you want."

Caterpillar (NYSE: CAT  ) had strong results -- stronger in mining than in construction, noted James. Meanwhile, 3M "was decent overall, better on the profit side, but UPS (NYSE: UPS  ) didn't really have great results. Volumes were pretty weak. ... These three stocks don't paint a cohesive picture."

Caterpillar yields 2.5%, and the share price has fluctuated in the past year from $67 to $117. Meanwhile, 3M yields 2.6%, with the share price ranging from $69 to $92 over the past year. UPS yields 3%, with a 52-week range of $61 to $82.

Ron said he doesn't overweight the reports of bellwether companies when making investing decisions. "I think bellwethers are interesting, and it ends at interesting," he said.

Watch the video to hear everything Ron and James had to say, along with Fool analyst Joe Magyer's thoughts on two other companies that act as indicators of the overall strength of the economy.

Click here for access to a special Motley Fool report analyzing the key opportunities and risks facing Caterpillar. This brand-new report breaks everything down for you in plain, easy-to-follow English.

Fool online editor Kris Eddy owns no shares of any stocks mentioned in this article.

The Motley Fool owns shares of Starbucks. Motley Fool newsletter services have recommended buying shares of Starbucks and 3M. Motley Fool newsletter services have recommended writing covered calls on Starbucks. Motley Fool newsletter services have recommended creating a diagonal call position in 3M. The Motley Fool has a disclosure policy.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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