Best Stocks of 2009 is HERE!!
Finally 2008 is almost over! I am cautiously optimistic about 2009, but will be watching the markets very closely. I used the past years trends and directions to formulate this years best stocks for 2009. I am very bullish for 2009 and think many of these stocks will have a great year. As you can see, most of the best stocks for 2009 are large cap stable companies that are grossly undervalued.
I tried to include a few stocks from each major industry, but I intentionally left a few out. Gaming, financials, automobile, and real estate industires are all going to take a lot longer to recover. These industries have lost investor confidence and for good reason. They have fundamental issues that need to be resolved before they should be purchased.
I think 2009 will be a great year for large cap staples as people move out of treasuries and back into the markets. It seams everyone in currently very heavy in cash which has put most large cap stocks in a great position for buyers.
If you have the guts to get back into the markets here my list of the best stocks for 2009.
Thursday, December 18, 2008
Tuesday, December 9, 2008
Wednesday, November 26, 2008
Happy Thanksgiving
Sarah Palin pardons a turkey for thanksgiving as others are killed in the background.
Flip
My wife bought me the new flip camera for our anniversary this week, so I thought I would share a video of my dog. Enjoy....
The market has been rebounding nicely this week from terrifying lows. I have not been following the markets too close this week as I am on vacation and don't need the added stress, but I like the movement in the financials.
I picked up some BAC last week that I am up pretty nicely in (although I had bought some in the 18's, so I am about even on this position). I am following some growth stocks and looking for an entry point on GOOG and UA. I believe we are going to be playing this yo-yo type market for a while between 10k and 8k on the dow. I am going to continue to trade the big movers in the financials (like BAC) in hopes of some quick jumps.
Hope everyone has a great thanksgiving!!!
Thursday, November 20, 2008
Bought 50 shares of BAC
Picked up some more BofA this morning at $12.07 to lower my cost basis. Hopefully the market will hit a bottom and build some momentum going forward.
Tuesday, November 18, 2008
Have you seen my guest bloggers?
I seem to remember a few months back introducing a couple of guest bloggers. They are obviously too important to make a single post in the past 3 months. It is unfortunate, but I have been forced to do something that I have been trying to avoid, which is to ban these two buffoons. Blogging is not for everyone. It takes commitment, and you have to work through the pain of paper cuts and strained eyes. I don't have hard feelings toward these two guys, but I just thought I would let all the MA faithful know what is going on behind the scenes.
RIP - JGIII & Duffman
Sunday, November 16, 2008
Sunday Post
A couple of thoughts:
First, do they have icicle christmas lights in places that have icicles? These lights have become very popular in Texas, but what about in Colorado or Montana? I would think if you have real icicles on your house it would be very dangerous to get up on your roof to put up christmas decorations.
Second, I was watching the Cowboys game tonight and noticed that the officials were helping the players off the turf on almost ever play. I have never noticed this before, so I was wondering if this was something new?
Third, can anyone stop Marion Barber?
Finally, when will the DOW hit 10,000?
If you could answer any of these questions for me, I would greatly appreciate it. Hope everyone had a great weekend. More posts coming this week.
First, do they have icicle christmas lights in places that have icicles? These lights have become very popular in Texas, but what about in Colorado or Montana? I would think if you have real icicles on your house it would be very dangerous to get up on your roof to put up christmas decorations.
Second, I was watching the Cowboys game tonight and noticed that the officials were helping the players off the turf on almost ever play. I have never noticed this before, so I was wondering if this was something new?
Third, can anyone stop Marion Barber?
Finally, when will the DOW hit 10,000?
If you could answer any of these questions for me, I would greatly appreciate it. Hope everyone had a great weekend. More posts coming this week.
Tuesday, October 28, 2008
50 Best Stocks, Down But Not Out
The 50 Best stocks of 2008 have let me down. I hope the last couple months of the year will help rebound this ugly portfolio of stocks. Here is the break down...
Out of 50 stocks from 1/1/2008 to 10/28/2008 only one is positive! Genetech, Inc. (DNA) is the only stock in the black (up 18.51%). 49 other stocks are loosers with Cypress Semiconductor (CY) pulling up the rear down a stagering 87.54%.
Keep a look out for a new 2009 list and a complete recap of 2007 picks when we get closer to the year end. For 2009 I may limit the list to 10-15 but I will put up some real cash and track each stock more carefully.
Cheers!
Out of 50 stocks from 1/1/2008 to 10/28/2008 only one is positive! Genetech, Inc. (DNA) is the only stock in the black (up 18.51%). 49 other stocks are loosers with Cypress Semiconductor (CY) pulling up the rear down a stagering 87.54%.
Keep a look out for a new 2009 list and a complete recap of 2007 picks when we get closer to the year end. For 2009 I may limit the list to 10-15 but I will put up some real cash and track each stock more carefully.
Cheers!
Stay Optimistic
It is hard to stay optimistic in a struggling economy, but if you look hard enough there are signs out there that this economy will soon turn around.
First, gas prices are dropping. I paid $2.22 for gas today! This means consumers disposable income is greater. If confidence in the economy is at question a few extra bucks in everyone pockets should help.
Second, November 4th. On November 4th we will be electing a new president of the United States. With this election will hopefully come some immediate changes to our economic situation. We currently have a president with an historically low approval ratting that nobody trusts. Americans desire for a leader has never been greater.
Third, less noise. Soon people will grow tired of listening to this media noise about the struggling economy and stop listening. Markets will stabilize and we will move on to more interesting issues like Paris Hilton.
Fourth, dollar. We can now vacation in Europe again! The dollar is back on the rise due to the struggling European economy. This will hopefully decrease the number of US companies being bought out by foreign investors taking advantage of the cheep dollar.
It is hard to predict when the markets will return to normalcy, but if we continue to stay optimistic and place our bets on strong companies we can take advantage of these downturns in the markets.
First, gas prices are dropping. I paid $2.22 for gas today! This means consumers disposable income is greater. If confidence in the economy is at question a few extra bucks in everyone pockets should help.
Second, November 4th. On November 4th we will be electing a new president of the United States. With this election will hopefully come some immediate changes to our economic situation. We currently have a president with an historically low approval ratting that nobody trusts. Americans desire for a leader has never been greater.
Third, less noise. Soon people will grow tired of listening to this media noise about the struggling economy and stop listening. Markets will stabilize and we will move on to more interesting issues like Paris Hilton.
Fourth, dollar. We can now vacation in Europe again! The dollar is back on the rise due to the struggling European economy. This will hopefully decrease the number of US companies being bought out by foreign investors taking advantage of the cheep dollar.
It is hard to predict when the markets will return to normalcy, but if we continue to stay optimistic and place our bets on strong companies we can take advantage of these downturns in the markets.
Monday, October 6, 2008
Bought VUG @ $45.01
Bought some VUG (a Vanguard ETF) on today's dip in the market. Hoping for a pop tomorrow when investors try to buy on the low.
Friday, October 3, 2008
Scare Tactics
The current administration has been using scare tactics for far to long, and we continue to fall for these ridicules tricks. It is unethical, immoral, and down right unamerican to use peoples fears to push a flawed agenda. Bush used these tactics to get us into one of the most expensive wars ever with lies about weapons of mass destruction and by trying to link terrorism to Iraq.
We should be able to trust our government not to lie to us, not to try and scare us, and to act fiscally responsible. The statements made by the republican party over the past few weeks have caused hysteria on Wall Street. The Dow drop today of over 700 points shows the lack of confidence in this current administration to work through these economic issues. We desperately need a change. I just hope we have some money left come November.
Here is another alarmist trying to get some ratings.
We should be able to trust our government not to lie to us, not to try and scare us, and to act fiscally responsible. The statements made by the republican party over the past few weeks have caused hysteria on Wall Street. The Dow drop today of over 700 points shows the lack of confidence in this current administration to work through these economic issues. We desperately need a change. I just hope we have some money left come November.
Here is another alarmist trying to get some ratings.
Monday, September 29, 2008
Sunday, September 28, 2008
Emergency Economic Stabilization Act of 2008
I am more interested in the Bears/Eagles game tonight, but I just downloaded a PDF of the Emergency Economic Stabilization Act of 2008. It is surprisingly detailed (110 page PDF) for being thrown together over the weekend. Here is the purpose of the act as stated in Section 2:
The purposes of this Act are—
(1) to immediately provide authority and facilities that the Secretary of the Treasury can use to restore liquidity and stability to the financial system of the United States; and
(2) to ensure that such authority and such facilities are used in a manner that—
(A) protects home values, college funds, re-
tirement accounts, and life savings;
(B) preserves homeownership and pro-
motes jobs and economic growth;
(C) maximizes overall returns to the tax-
payers of the United States; and
(D) provides public accountability for the
exercise of such authority.
Some of the more interesting language comes in the first Section 101 "Purchase of Troubled Assets." Within this section they setup a Trouble Asset Relief Program known as TARP and gives the President authority to appoint an Assistant Secretary of the Treasury who will head up the Office of Financial Stability. The bill appears pretty strong with required transparency and accountability, but we will se how it is executed.
The purposes of this Act are—
(1) to immediately provide authority and facilities that the Secretary of the Treasury can use to restore liquidity and stability to the financial system of the United States; and
(2) to ensure that such authority and such facilities are used in a manner that—
(A) protects home values, college funds, re-
tirement accounts, and life savings;
(B) preserves homeownership and pro-
motes jobs and economic growth;
(C) maximizes overall returns to the tax-
payers of the United States; and
(D) provides public accountability for the
exercise of such authority.
Some of the more interesting language comes in the first Section 101 "Purchase of Troubled Assets." Within this section they setup a Trouble Asset Relief Program known as TARP and gives the President authority to appoint an Assistant Secretary of the Treasury who will head up the Office of Financial Stability. The bill appears pretty strong with required transparency and accountability, but we will se how it is executed.
Drugs!
People tend to cut back during a recessionary time. No extravagant vacations, new jewelry, golf clubs, wardrobe updates, or new shoes for your tricked out ride. Most industries will begin to slow as consumers tighten their wallets. But a few industries will continue to see profits rise because consumers need these products to survive. Pharmaceuticals have been one of the few industries to hold strong during this slow down in the economy. Here are a few pharmaceuticals that everyone should consider adding.
Pfizer (PFE) - Pfizer, Inc. engages in the discovery, development, manufacture, and marketing of prescription medicines for humans and animals worldwide. Lipitor, Viagra, Lyrica, Zoloft, and Celebrex are a few of their better known products. The stock is near a 52 week low, so this could be a great entry point. PFE is sitting on a lot of cash (26.1B), so look for them to be buying up smaller competitors in the near future.
Eli Lilly & Co. (LLY) - About half the size of Pfizer, but just as profitable. Federal health regulators delayed a decision on a blood thinner from Eli Lilly for a second time Friday, raising concerns on Wall Street about the potential blockbuster medication. The drug, called prasugrel, is considered crucial to Indianapolis-based Lilly, which faces a wave of patent expirations in the next few years. If passed, LLY will see a considerable jump in the stock price, but it is a gamble at this point.
Johnson & Johnson (JNJ) - Seen as a more stable competitor due to a more diverse operating base. Pharmaceuticals account for about 41% of total sales, with medical/diagnostic products at 35% and consumer personal care products at 24%. The stock has acted better than most, but it has made little net progress in the last six years.
Wednesday, September 24, 2008
Recession Proof Stocks - Tech
The market is in shambles, financials are crumbling, and everyone is calling for Armageddon. So where do you put your money? I think tech is a great alternative for nervous investors and you can get a steal if you know where to look. Here are my top five tech stocks that look safe in this stumbling economy and have great upside.
1. Adobe (ADBE) - I have been long this stock for a very long time and believe it has a ton of potential. They have some of the best software products on the market. They have successfully cornered markets in consumer and industry. Great buy below $35!
2. Apple (AAPL) - Do I really have to explain this one?
3. Texas Instruments (TXN) - One of my all time favorite stocks that is super cheap right now. I have never lost money trading TXN and don't plan on starting now. TXN is trading slightly above it's 53 week high and is ready to head back north.
4. McAfee (MFE) - As long as people keep buying PC's MFE will continue to make money.
5. Electronic Arts Inc. (ERTS) - I don't play video games very much, but come on they make Madden. I have been following ERTS for a while and believe it has a bit more of a downside, but I think this is a great long term buy.
1. Adobe (ADBE) - I have been long this stock for a very long time and believe it has a ton of potential. They have some of the best software products on the market. They have successfully cornered markets in consumer and industry. Great buy below $35!
2. Apple (AAPL) - Do I really have to explain this one?
3. Texas Instruments (TXN) - One of my all time favorite stocks that is super cheap right now. I have never lost money trading TXN and don't plan on starting now. TXN is trading slightly above it's 53 week high and is ready to head back north.
4. McAfee (MFE) - As long as people keep buying PC's MFE will continue to make money.
5. Electronic Arts Inc. (ERTS) - I don't play video games very much, but come on they make Madden. I have been following ERTS for a while and believe it has a bit more of a downside, but I think this is a great long term buy.
Banana Chasing a Gorilla = Jail Time
Two students pulled a hilarious and relatively harmless prank during a Flower Mound Texas High School football game on Friday night. One dressed as a banana and the other as a gorilla and, shockingly, the banana chased the gorilla across the football field. The police didn't think it was very funny and arrested the teens. The charges were later dropped after backlash from citizens who felt the punishment was to strict.
Tuesday, September 23, 2008
Chrysler Electric Options
Chrysler plans on introducing their first electric auto in 2010. The concept cars look pretty sweet, but they always look much cooler in concept. The Zeo posts 250 miles per charge with a 0-60 in less than 6 seconds. Here is a detailed description on each model from MSN.
Chrysler ecoVoyager
The elliptically shaped ecoVoyager features a panoramic glass roof with a center spine, short body overhangs and a boat-tail back end.
Doors open up to 90 degrees and the rear doors are hinged at the rear with no B-pillar for easy access.
Four individual chairs are contoured and a recessed area in the headliner between the two skylights contains the “Direct Sound” function that directs the music choice to each individual without the need for headphones.
This concept has an electric motor that develops 200 kilowatts (268 horsepower) with a 40-mile, 16 kilowatt-hour lithium-ion battery module. Driving range can be extended to 300 miles when coupled with the advanced hydrogen fuel-cell range extender.
To assist in charging the battery, a regenerative braking system captures energy that would normally be lost and returns it to the battery. The entire propulsion system is located below the ecoVoyager’s floor to maximize interior space.
Jeep Renegade
The Renegade is designed to go just about anywhere and it can do it for a long time.
The battery pack provides a 40 mile range and a 1.5-liter three-cylinder BLUETEC diesel engine acts as a range extender for a total range of 400 miles. Lightweight aluminum and regenerative braking help improve overall efficiency.
The propulsion system features dual electric 200-kilowatt (268 horsepower) motors, one for each axle for true off-road capability complete with low range and locking differentials.
Aggressively styled with oversized wheels and tires, the Renegade is decked out with rubber-clad headlights and taillights for a rugged look. In Detroit, the concept was equipped with a lid to store two water scooters for scuba divers.
Inside, the Renegade has one-piece molded, soy-based foam seats and doors, a one-piece co-molded instrument panel with a urethane skin and an aluminum/silicone steering wheel.
Dodge ZEO
Named for Zero Emissions Operation, the Dodge ZEO is a four-passenger, all-electric 2+2 sport wagon.
Riding on a rear-wheel-drive platform, the ZEO is powered by a 200-kilowatt (268 horsepower) single-electric motor combined with a 64 kilowatt-hour lithium-ion battery pack that has of a range of at least 250 miles. Chrysler claims zero to 60 mph acceleration in less than 6 seconds.
The windshield glass continues nearly to the rear of the car and all four doors are “scissor” doors with the rear doors pivoting at the rear. The crosshair Dodge grille is lit with LED lights.
The interior is blended into a whole by a broad, sloping, fabric-wrapped surface in front of the driver that curves into the door and around the back panel to the other side with strips of LED accent lighting adding to the effect.
A slim center console slopes down from the windshield of the Dodge ZEO, creating a dual-cockpit effect, and the steering wheel, column and instruments are treated as a single freestanding design element.
Sunday, September 21, 2008
Mad Science
Will $700 billion dollars save this market? Treasury Secretary Henry Paulson thinks so, as he is urging congress to act fast on this bail out. I agree that it is necessary to save financials, but it is not the taxpayers responsibility to burden the debt of poor decisions made by greedy bankers. Obviously, regulations need to be put into place to insure that this never happens again. Hopefully some of this debt that we (as taxpayers) are about to own will turn into a profitable investment down the road.
Sunday, September 14, 2008
My Last Sarah Palin Post
Here is the last Sarah Palin post for a while. Back to stocks on Monday.
See more funny videos at Funny or Die
BofA to buy Merrill Lynch
Surprising news that should boost BofA at the open. BofA is taking advantage of this sale on financials. After picking up Countrywide they are making a play for a huge full service brokerage in Merrill Lynch. Soon anyone working in the financial industry will be employeed by BofA. From this early stage it looks like a good move for BofA. Here is the headline on Yahoo Finance....
Bank of America Corp. will reportedly buy Merrill Lynch & Co. for about $44 billion
NEW YORK (AP) -- Bank of America Corp. has agreed to buy Merrill Lynch & Co. for about $44 billion, or around $29 a share, according to The Wall Street Journal. A deal between the two big financial companies would lift the uncertainty that has shrouded Merrill Lynch since the start of the credit crisis a year ago.
Sunday, August 31, 2008
Friday, August 29, 2008
Happy Birthday John McCain
Today is a big day for John McCain. He named Sarah Palin as his running mate and turned 72 today. Just so you know, the current life expectancy of a male in the US is 75.15
Wednesday, August 27, 2008
Thursday, August 21, 2008
Guest Bloggers
Under advise from my legal council and an extensive search, I have decided to invite two guest bloggers to join Market Anomalies. JGIII & Duffman have been added to the blog roll and will periodically post on current issues. Welcome new bloggers!
Tuesday, August 19, 2008
Sunday, August 17, 2008
Best Workout Songs - Top 10 List
Lately I have been on a quest to find the best workout songs. In my opinion a good workout song has to have a good beat, fast lyrics, and a strong catch phrase. I prefer rap and rock, but anything can work if it fits the criteria. Here are my current favorites that fill my iPod. Add any of your favorites in the comments below.
10. Foo Fighters - Everlong
9. Gnarls Barkley - Crazy
8. Pepper - No Control
7. Kenya West - Gold Digger
6. Jet - Are You Gonna Be My Girl
5. 50 Cent - Many Men
4. Outcast - B.O.B.
3. Survivor - Eye of The Tiger
2. Jay Z - 99 Problems
1. The All American Rejects - Move Along
Comments? I am open to any suggestions.....
Saturday, August 9, 2008
Olympics
I love the summer Olympics! I am currently flipping between hand ball and indoor volleyball. I don't really understand the rules of handball, but it still fun to watch. Looking forward to water polo, fencing, Judo, and shooting. The level of competition is truly unbelievable. The medal count is on and I have an early prediction; USA will end up with 103 medals.
Have a great weekend..
Sunday, August 3, 2008
Nike+
I just went for a short jog tonight. It was well over 100 degrees all day today in Dallas, so I am limited to running in the early morning and in the late evenings (when it is only in the 90's). I don't really enjoy running, but I always feel pretty good when I stop so it must be good for me. I guess what doesn't kill you makes you stronger. I downloaded the song "Eye of the tiger" by Survivor and played it on a loop. I am pretty sure I was singing aloud the whole time, but that song really pumps me up.
Back to stocks for a moment. We have seen a lot of volatility over the past week. Cramer continues to try to call the bottom, but who knows. I am still pretty heavy in cash, but this week I plan on placing some bets. I am looking at value companies like Nike, PepsiCo, and maybe even a tech play like Google. I will post when I decide to pull the trigger.
Hope everyone had a great weekend! Oh yeah, I added a new Nike+ tool to the right side of this page. I know I am slow, I have no excuses.
Back to stocks for a moment. We have seen a lot of volatility over the past week. Cramer continues to try to call the bottom, but who knows. I am still pretty heavy in cash, but this week I plan on placing some bets. I am looking at value companies like Nike, PepsiCo, and maybe even a tech play like Google. I will post when I decide to pull the trigger.
Hope everyone had a great weekend! Oh yeah, I added a new Nike+ tool to the right side of this page. I know I am slow, I have no excuses.
Friday, August 1, 2008
The Body of Business
A coworker told me the other day that she thought accounting was the skeleton of all business. If you had a firm understanding of accounting principals and methods that you could be successful in almost all aspect of business. This theory got me to thinking, what role would sales, marketing, advertising, finance, HR, IT, and customer service play in this analogy.
Direct costumer interaction would have to be the bodies skin. This would include sales, marketing, advertising, and customer service. This is the businesses first impression to potential clients or customers. Not really the personality of the business, but the appearance. The packaging and advertising is outwardly visible and is potentially a deal breaker a lot of the time.
The blood of the body would have to be the IT, HR, and customer service. These operations keep the business functioning with staff and systems that work.
The brain of the business would be the management who hopefully has a vision for the company and the plan to turn the vision into reality.
I clearly have not fully thought this out, but you can see where I am going. If one aspect of the body fails to meet expectations the whole body will suffer. Think about it.
Direct costumer interaction would have to be the bodies skin. This would include sales, marketing, advertising, and customer service. This is the businesses first impression to potential clients or customers. Not really the personality of the business, but the appearance. The packaging and advertising is outwardly visible and is potentially a deal breaker a lot of the time.
The blood of the body would have to be the IT, HR, and customer service. These operations keep the business functioning with staff and systems that work.
The brain of the business would be the management who hopefully has a vision for the company and the plan to turn the vision into reality.
I clearly have not fully thought this out, but you can see where I am going. If one aspect of the body fails to meet expectations the whole body will suffer. Think about it.
Thursday, July 24, 2008
WhyTuesday.org
Great website that explores why the United States voter turnout is so low and what we can do to change it. They have some great interviews with almost every presidential candidate. Check out the site here to see more....
Friday, July 18, 2008
Is the bull back?
After two days of bullish trading or possibly the largest short squeeze in recent history, the market is looking bullish again. Citi reported a better than expected 2nd quarter loss that will hopefully rally the markets again today.
Energy is a continuing concern among investors although crude has backed off all time highs. Check out the "Pickens Plan" if you are interested in alternative sources particularly wind power.
Thanks Ragan for the lead...
Monday, July 14, 2008
Marketing and Charts
I am a big fan of Seth Godin and I read his blog religiously. I recommend putting it in your favorites and reading it often. He is a marketing guru who has great ideas for any entrepreneur, business owner, executive or consultant. Every time I leave his blog my mind is spinning with ideas and strategies. This time was no different..
Seth's post on "three laws for great graphs" is a must read. KISS (Keep It Simple Stupid). His three simple rules to follow when making charts to use in a presentation are:
1. One Story
2. No Bar Charts
3. Motion
These rules are on point and should be used by everyone giving a presentation. Read the post and let me know what you think..
Wednesday, July 9, 2008
Interesting News
-Google is testing a new application that will provide walking routes available on your computer or cellphone. The current Google maps application provides driving directions that may not be the shortest route for walkers or bikers due to one way streets, parks, and tunnels. Tourists traveling to major cities like New York will benefit the most from this application although Google will add a disclaimer saying "use caution when walking in unfamiliar areas," meaning "don't blame us if you get mugged." See the story here...
- It has been confirmed, Americans are criminals.. According to a report from Futuresouce Consulting one-third of consumers in the US and UK have made a copy of a DVD in last six months. This seems really high, but I found it on the Internet so it must be true. Check out the story here...
- Canadians are pissed that they have to sign a three year contract with Rodgers Communications to purchase a 3G iPhone. Apple is apparently behind the consumer or are mad abooout the bad publicity because they are diverting shipments to the UK meant for Canada and are not selling the overpriced plans at the Apple stores. Check out this story here...
- It has been confirmed, Americans are criminals.. According to a report from Futuresouce Consulting one-third of consumers in the US and UK have made a copy of a DVD in last six months. This seems really high, but I found it on the Internet so it must be true. Check out the story here...
- Canadians are pissed that they have to sign a three year contract with Rodgers Communications to purchase a 3G iPhone. Apple is apparently behind the consumer or are mad abooout the bad publicity because they are diverting shipments to the UK meant for Canada and are not selling the overpriced plans at the Apple stores. Check out this story here...
Gaming Stocks
Vegas has been taking a hit from the slumping economy and the rising gas prices. Weekend gamblers that make the trip from LA are dropping off and vacationers are searching for less expensive alternatives. Airlines are cutting flights and gas prices are getting more expensive everyday. Here are a few stocks to follow if you are thinking about rolling the dice or want a good short..
MGM Mirage (MGM)
Las Vegas Sands (LVS)
Boyd Gaming (BYD)
Wynn Resorts (WYNN)
Wednesday, July 2, 2008
5 Recession Proof Stocks
The market is officially in the dumps. If you are still long the market here are 5 of my top picks to ride through this slow economy.
1. Coach (COH) - High-end retailers historically do not follow the market into recessionary times. With a P/E under 15 COH looks like a buy at this price. Coach is a staple of high end fashion and should fare well through the next few months.
2. Chesapeake Energy Corp (CHK) - Producer of natural gas in the US, CHK owns approximately 38,500 producing oil and natural gas wells. High oil prices are driving CHK high and should continue throughout the summer.
3. Nike (NKE) - Nike is a steal at the current price after taking a tumble. Less then impressive growth has put NKE on the hot seat with investors, but aggressive international growth and Olympic exposure should help this staple continue to grow.
4. PepsiCo, Inc. (PEP) - PepsiCo has continued to impress investors with outstanding growth and increasing market share. International growth along with domestic synergy will allow PEP to continue the impressive growth during a slowing economy.
5. Toyota Motor Co. (TM) - Toyota has continued to take advantage of the green movement. Green companies will prosper this summer as fuel prices continue to rise. I have been following TM for a few months and may pick up a few shares this week.
1. Coach (COH) - High-end retailers historically do not follow the market into recessionary times. With a P/E under 15 COH looks like a buy at this price. Coach is a staple of high end fashion and should fare well through the next few months.
2. Chesapeake Energy Corp (CHK) - Producer of natural gas in the US, CHK owns approximately 38,500 producing oil and natural gas wells. High oil prices are driving CHK high and should continue throughout the summer.
3. Nike (NKE) - Nike is a steal at the current price after taking a tumble. Less then impressive growth has put NKE on the hot seat with investors, but aggressive international growth and Olympic exposure should help this staple continue to grow.
4. PepsiCo, Inc. (PEP) - PepsiCo has continued to impress investors with outstanding growth and increasing market share. International growth along with domestic synergy will allow PEP to continue the impressive growth during a slowing economy.
5. Toyota Motor Co. (TM) - Toyota has continued to take advantage of the green movement. Green companies will prosper this summer as fuel prices continue to rise. I have been following TM for a few months and may pick up a few shares this week.
Tuesday, June 24, 2008
Friday, June 20, 2008
Gas Prices and Politics
While driving home from work today I was listening to a Republican talk show. The topic was, of course, gas prices and the continued climb north. They were making the argument that the Democrats were happy that gas prices were hitting all time highs and putting the squeeze on Americans pocketbooks. This type of rhetoric is very common in a red state like Texas, and this is one of the less asinine viewpoints. I am somewhat neutral in my political views although I tend to lean more liberal. Like most republicans I believe in a free market (at least in theory), but I do not agree in big business getting rich at the cost of society and the environment. Now that you know my viewpoint back to the topic at hand.
The only reason Democrats would be happy that gas prices are increasingly more expensive is this may encourage society to turn to alternative fuel sources that are more environmentally friendly. Everyone should agree that we need to find an alternative fuel source to free ourselves from our dependency on foreign countries. Oil prices are ridicules, but increasing drilling is only a temporary solution that is simply going to delay the inevitable. The inevitable being an alternative fuel source.
It would be a shame if congress decides to lift the ban on drilling in the Gulf of Mexico.
Back to stocks for a second. I have one picks for each situation. If congress decides to lift the ban, buy some RIG. Here is their business summary from Google finance:
If congress does not lift the ban and oil prices continue to rise look for some action in the solar industries. My favorite here is FSLR. Here is their business summary from Google finance:
Hope everyone has a great weekend!
The only reason Democrats would be happy that gas prices are increasingly more expensive is this may encourage society to turn to alternative fuel sources that are more environmentally friendly. Everyone should agree that we need to find an alternative fuel source to free ourselves from our dependency on foreign countries. Oil prices are ridicules, but increasing drilling is only a temporary solution that is simply going to delay the inevitable. The inevitable being an alternative fuel source.
It would be a shame if congress decides to lift the ban on drilling in the Gulf of Mexico.
Back to stocks for a second. I have one picks for each situation. If congress decides to lift the ban, buy some RIG. Here is their business summary from Google finance:
Transocean Inc. (Transocean) is an international provider of offshore contract drilling services for oil and gas wells. As of February 20, 2008, the Company owned, had partial ownership interests in or operated 139 mobile offshore drilling units. Its fleet included 39 high-specification floaters (ultra-deepwater, deepwater and harsh environment semisubmersibles, and drillships), 29 midwater floaters, 10 high-specification jackups, 57 standard jackups and four other rigs. As of February 20, 2008, the Company also has eight ultra-deepwater floaters contracted for or under construction. The Company’s primary business is to contract these drilling rigs, related equipment and work crews primarily on a day rate basis to drill oil and gas wells. In November 2007, the Company completed its merger transaction with GlobalSantaFe Corporation (GlobalSantaFe).
If congress does not lift the ban and oil prices continue to rise look for some action in the solar industries. My favorite here is FSLR. Here is their business summary from Google finance:
First Solar, Inc. designs and manufactures solar modules using a thin film semiconductor technology. Its solar modules employ a thin layer of cadmium telluride semiconductor material to convert sunlight into electricity. It has long-term solar module supply contracts (the Long Term Supply Contracts) with 12 European project developers and system integrators. Its customers develops, owns and operates solar power plants or sells turnkey solar power plants to end-users that include owners of land, owners of agricultural buildings, owners of commercial warehouses, offices and industrial buildings, public agencies, municipal government authorities, utility companies, and financial investors that desire to own large scale solar power plant projects
Hope everyone has a great weekend!
Market Talk
The markets are collapsing, yet people seem upbeat. I try to discuss economics with just abut everyone I meet. Trying to get a grasp on where we are headed and where we have been. Surprisingly the majority of people I speak to seam optimistic about the economic future of our country. We all know the markets are finicky and everything is cyclical, but we are not playing with monopoly money. I guess a loss is not technically a loss until you sell, but seeing huge unrealized losses in your brokerage account will make even the most experienced investor nervous. I am staying long in my portfolio and am going to try and ride this wave out, but it is very tempting to jump ship when the markets are steadily heading south.
The good news is the markets are closed for a couple of days! So relax and have a drink, we could all use one. Hopefully the markets will turn positive again on Monday.
The good news is the markets are closed for a couple of days! So relax and have a drink, we could all use one. Hopefully the markets will turn positive again on Monday.
Thursday, June 19, 2008
Snoop Dog Country Song?
The market has been in major pain this week with financials leading the way. I have made a few buys on the way down, but I am still very heavy in cash. Trying to stay away from the falling knife. You know things are going crazy when Snoop starts singing country.... If you are a bear congrats, bulls hang tight..
Tuesday, June 10, 2008
Comic Relief
I may have found one of the funniest sites on the web! If you have ever worked in a cube, than you will truly appreciate MyLifeInaCube.com... Here is one of my favorites.
Monday, June 9, 2008
Apple Update
Coming in early July! Apple introduces the new 3G iPhone with minor updates and a much lower price tag. The 8 gig iPhone will sell for $199 and the 16 gig will sell for $299 . That is about $200 less than the current price. The new phone will include a all black back and a flush headset jack. The iPhone will also have GPS which will allow for turn by turn directions.
Apple also announced a new version of Mac OS X that is sure to impress.
The stock took a dip upon the news, but bounced back before the close and is up in after hours trading.
Disclosure: Long AAPL
Saturday, June 7, 2008
Friday, June 6, 2008
Apple does Vegas!
A new apple store is being built in Las Vegas that could be the most extravagant apple store ever! The apple insider has the story here...
Brawl!! Red Sox Vs Tampa Bay
MLB will likely take this down soon, but it is working for now. Have a good weekend!
Wednesday, June 4, 2008
OBAMA for President!
Here is Obama's speech last night as he wins the democratic nomination on his way to becoming the president of the United States. What a great speech! Watch for yourself...
Tuesday, June 3, 2008
No more Hummers?
GM has announced today that they are going to close 4 truck producing plants, in order to make more small cars. They also said that they will consider selling the Hummer Brand. Bloomberg has a great article here covering the story.
Monday, June 2, 2008
Google Vs. Yahoo!
Yahoo! has been the standard finance search for as long as I can remember, but a lack of innovation has allowed Google to take over as the top financial site in my opinion. The Google/Yahoo competition is extensive to say the least. They are in direct competition in basically every category and Yahoo has been loosing ground to Google exponentially.
Here are the top 5 reasons I use Google Finance over Yahoo Finance...
1. No Ads... Google Finance is laid out very clean and clear with no ads. Yahoo Finance is covered with a ridicules number of ads, many of which will pop up or slide into your view causing vigorous cursing and yelling.
2. Clean and easy to use charts... Google Finance has great easy to use charts. You do not have to open a separate page to analyze the chart. Take AAPL for example. When you pull up the AAPL page you get the financials across the top with a basic 3 day chart. Simply drag the chart to expand or pick the timeline you wish to view. It works great, try it...
3. Everything is on one page... The financials, blog posts, news, related companies, financials, discussions, events, key stats & ratios, officers & directors, and a brief summary. Very convenient and very clean.
4. News linked charts... This is relatively new to financial sites and is one of my favorite innovations. This makes it very easy to understand the dips and jumps in a stock. Google has it, Yahoo does not.
5. Outside links... Google is the first to admit they can not do it all, so they link to Reuters and Yahoo Finance.
Here are the top 5 reasons I use Google Finance over Yahoo Finance...
1. No Ads... Google Finance is laid out very clean and clear with no ads. Yahoo Finance is covered with a ridicules number of ads, many of which will pop up or slide into your view causing vigorous cursing and yelling.
2. Clean and easy to use charts... Google Finance has great easy to use charts. You do not have to open a separate page to analyze the chart. Take AAPL for example. When you pull up the AAPL page you get the financials across the top with a basic 3 day chart. Simply drag the chart to expand or pick the timeline you wish to view. It works great, try it...
3. Everything is on one page... The financials, blog posts, news, related companies, financials, discussions, events, key stats & ratios, officers & directors, and a brief summary. Very convenient and very clean.
4. News linked charts... This is relatively new to financial sites and is one of my favorite innovations. This makes it very easy to understand the dips and jumps in a stock. Google has it, Yahoo does not.
5. Outside links... Google is the first to admit they can not do it all, so they link to Reuters and Yahoo Finance.
Friday, May 23, 2008
Belgium Bud?
Anheuser Busch is up 8% today on news that InBev, a Belgium brewery, is in talks to purchase Busch for a reported $46 billion. A 9 dollar premium for shareholders who were holding the stock before the news was leaked. One report says that InBev would be willing to pay as much as $67 a share for BUD.
A struggling economy paired with rising commodity costs in a mature market has slowed sales growth for BUD recently. Buyouts and consolidations have been popular over the past few years among breweries. SAB and Miller, Molson and Coors, and Carlsberg/Heineken and Newcastle have all made deals in the past few years.
A weak dollar will likely encourage more foreign buyouts of US companies over the next year, but who is next?
Here are some of the best Bud Light commercials ever...
A struggling economy paired with rising commodity costs in a mature market has slowed sales growth for BUD recently. Buyouts and consolidations have been popular over the past few years among breweries. SAB and Miller, Molson and Coors, and Carlsberg/Heineken and Newcastle have all made deals in the past few years.
A weak dollar will likely encourage more foreign buyouts of US companies over the next year, but who is next?
Here are some of the best Bud Light commercials ever...
Tuesday, May 20, 2008
3G iPhone Confirmed
According to Gizmodo the iPhone launch date has been confirmed for June 9th. Here is the news from Gizmodo:
We all suspected it, but now it is confirmed: someone very, very close to the 3G iPhone launch has told me that Apple will announce their new model at the WWDC Keynote on June 9th. The second-generation iPhone will be available worldwide right after the launch, and not at year's end, as previously thought. The new model will also herald new sales policies in some countries.
In Spain, for example, the 3G iPhone will be available for sale at the June 18th grand opening of Telefonica's megastore—an Apple Store-like shop located in the company's historical building in Madrid's Gran VÃa— with nationwide availability the next day or after a few hours. The other European countries with iPhone availability will have similar launch schedules.
According to another source involved in the launch, the 3G iPhone will no longer be available at a fixed price point—at least in some countries, and its launch will also bring new sales policies, although these have not been completely specified yet.
The move is a logical step, since the iPhone has clearly solidified its position as the cellphone to beat during the last 12 months, and companies in the cutthroat European cellphone market need to use it as an incentive to capture clients aggressively.
This most probably means the new 3G iPhone will be integrated in the usual marketing systems of carriers, with point-based trade-ups, discounts for carrier switchers and other service-based subvention packages.
Wednesday, May 14, 2008
Apple store in Boston
New Apple store in Boston looks pretty amazing. I may have to take a pilgrimage. Check out some pictures here..
Tuesday, May 13, 2008
HP to buy EDS
Hewlett Packard (HP) announced today (leaked out yesterday afternoon) that they have struck a deal to purchase Electronic Data Systems (EDS) for 13.9 billion to strength it's service business. Here are details:
The companies' collective services businesses had combined revenue of more than $38 billion and 210,000 employees in fiscal 2007. The deal will more than double HP's services revenue, which accounted for $16.6 billion of the company's $104 billion in revenue in fiscal 2007.
Palo Alto, Calif.-based HP (NYSE: HPQ) is buying EDS for $25 per share, which EDS stockholders will receive for each share of common stock they hold at the closing of the merger, expected in the second half of this calendar year.
HP (NYSE: HPQ) said it intends to establish a new business group called EDS- an HP company, which will be based at EDS's existing headquarters in Plano, Texas. EDS Chairman, President and CEO Ronald Rittenmeyer will continue to lead EDS's operations following the deal's closing. EDS is a provider of consulting and technology outsourcing services.
So is this a good deal for shareholders? It depends who you are holding. EDS shareholders are probably getting the better deal, since the company has been pretty stagnate in a growing industry. Here is the prior year chart for EDS (it is pretty ugly). If HP has the corporate leadership to turn around the struggling service company than HP shareholders may see some benefit down the road.
Monday, May 12, 2008
Story of the Day
This is almost unbelievable, but hilarious nonetheless. Thanks to Skeeter for the link.. I think it is fitting based on today's earlier post.
A 13 year old from Texas who stole his Dad's credit card and ordered two hookers from an escort agency, has today been convicted of fraud and given a three year community order.
Ralph Hardy, a 13 year old from Newark, Texas confessed to ordering an extra credit card from his father's existing credit card company, and took his friends on a $30,000 spending spree, culminating in playing "Halo" on an Xbox with a couple of hookers in a Texas motel.
The credit card company involved said it was regular practice to send extra credit cards out as long as all security questions are answered.
The escort girls who were released without charge, told the arresting officers something was up when the kids said they would rather play Xbox than get down to business.
Police said they were alerted to the motel by a concerned delivery clerk, whom after delivering supplies of Dr Pepper, Fritos and Oreos had been asked by the kids where they could score some chicks and were willing to pay. They explained they had just made a big score at a "World of Warcraft" tournament and wanted to get some relaxation. On noting the boys age the delivery clerk informed the authorities.
When police arrived at the motel they found $3,000 in cash, numerous electronic gadgets, an Xbox video console with numerous games, and the two local escort girls.
Ralph had reportedly told police that his father wouldn't mind, as it was his birthday last week and he had forgot to get him a present. The father, a lawyer said he had been too busy, but would take him on a surprise trip to Disneyland instead.
Asked why he ordered two escorts, Ralph said he thought it was the thing to do when you win a "World of Warcraft" tournament. They told the suspicious working girls they were people of restricted growth working with a traveling circus, and as State law does not allow those with disabilities to be discriminated against they had no right to refuse them.
The $1,000 a night girls sensing something up played "Halo" on the Xbox with the kids, instead of selling their sexual services.
Ralph's ambition is to one day become a politician.
Ricks Cabaret (RICK)
Ricks Cabaret (RICK), an operator of 15 adult nightclubs, has apparently not been effected by the current economic slowdown. I guess we know where guys are spending their stimulus checks. I have been folowing this stock for a while, but never pulled the trigger. It has released very strong 2008 and 2009 outlook and looks poised to move higher. I will continue to watch for know, but I will be looking to add some shares on a dip.
Here is an excerpt from yahoo:
"For its 2008 fiscal year the company said it expects to have sales of approximately $61 to $62 million, with after tax net income of about $10.5 to $11 million, on which it anticipates earning between $1.25 and $1.30 per fully diluted share. If spread over all of calendar 2008 revenues should equal about $68-$70 million, with net income of about $13 to $14 million and projected earnings of approximately $1.55 to $1.60 per fully diluted share.
The company’s outlook for fiscal 2009 anticipates revenues of exceeding $100 million, with earnings per share in the $2.30 to $2.50 range per fully diluted share."
Sunday, May 11, 2008
ETF
I spent some time this weekend looking into ETF's to hedge my long positions. My portfolio is currently about 90% long and 10% cash. In retrospect when the market hit 14,000 a while back I should have begun searching for something to hedge my long positions. The bear market short ETF's have been doing great this year (SSG is up nearly 35% YTD).
I always thought of ETF's were a great way to invest in foreign stocks without having to due extensive research, but domestic ETF's always seemed like an expensive mutual fund that you could trade like a stock. If you are not very familiar with ETF's Yahoo! has nailed it.
A short fund ETF is a great way to get some short exposure without the risk of actually shorting a particular stock. I like the idea of hedging my long positions with some short exposure, but I don't like the risk of a short squeeze. Here are a few of the top performing short ETF's and here is a blog that covers ETF's.
SSG, REW, QID, RXD, and SKK
I always thought of ETF's were a great way to invest in foreign stocks without having to due extensive research, but domestic ETF's always seemed like an expensive mutual fund that you could trade like a stock. If you are not very familiar with ETF's Yahoo! has nailed it.
A short fund ETF is a great way to get some short exposure without the risk of actually shorting a particular stock. I like the idea of hedging my long positions with some short exposure, but I don't like the risk of a short squeeze. Here are a few of the top performing short ETF's and here is a blog that covers ETF's.
SSG, REW, QID, RXD, and SKK
Saturday, May 10, 2008
Thursday, May 8, 2008
What's in your wallet? - Credit Cards
America is addicted to debt, so why not make a few bucks off this addiction. Here are three credit cards stocks that I am following. Which one do you like the best?
Master Card (MA)
Closing Price - $293.41
P/E Ratio - 29.95
F P/E - 26.46
EPS - 9.80
Yield - .20
Visa (V)
Closing Price - 87.30
Visa went public in March so no historical data is available
American Express (AXP)
Closing Price - 48.85
P/E Ratio - 14.64
F P/E - 17.67
EPS - 3.34
Yield - 1.47
Master Card (MA)
Closing Price - $293.41
P/E Ratio - 29.95
F P/E - 26.46
EPS - 9.80
Yield - .20
Visa (V)
Closing Price - 87.30
Visa went public in March so no historical data is available
American Express (AXP)
Closing Price - 48.85
P/E Ratio - 14.64
F P/E - 17.67
EPS - 3.34
Yield - 1.47
Monday, May 5, 2008
50 Best Stocks for 2008 - UPDATE
Only 11 of the 50 best stocks for 2008 are in the black! Click here for the original list. The 11 winners are CAJ, CHK, DKS, DNA, JPM, MTH, NKE, RIG, RIMM, TGT, & TOT. Overall the portfolio is down about 9.92%. I will continue to follow this all year, and hopefully we will go positive soon. I put in some limit orders today to peel back my AAPL position, but none have hit so far. As soon as I free up some cash I will be evaluating this list again looking for some winners.
Lunch with Greenspan
Do you have an extra $16,000? You could have lunch with Alan Greenspan & Andrea Mitchell at the Four Seasons in Washington DC. Check it out here.... The current bid is 16k
$360,000,000,000 Personal Check
My man Charles Fuller tried to cash a personal check for 360 billion dollars last week at a Chase bank in Dallas. This dude is awesome! What do you think the teller thought when she saw all the zeros on the check. Needless to say he was arrested and charged with theft, unlawful carrying of a weapon, and possession of a green leafy substance. Hat tip to Skeeter for the story...
Sunday, May 4, 2008
New Trades, Kentucky Derby Update
I plan on pulling some AAPL off the table tomorrow, if it continues to head north. I am way to heavily invested in one stock so I am going to be looking to spread the action. I have made huge gains in AAPL, so it may be time to peal down my position. Still love the company and where it is headed, but it is never smart to be to heavy in one stock. I will sleep on it.....
My wife cleaned up at the Kentucky Derby this weekend. She put all of her money on Big Brown to win! I may have her pick some stocks for me.
Microsoft Pulls Yahoo Offer
Microsoft withdrew its bid to purchase Yahoo for 42.3 Billion on Saturday. Bad news for Yahoo shareholders, who are going to take a hit on Monday. Microsoft will not pursue a hostile takeover of Yahoo. This was a smart move for Microsoft who was offering way to much for the struggling Yahoo. Microsoft should wait for a year and if Yahoo continues to struggle make a lower offer or a hostile takeover. Here is Steve Ballmer's letter to Jerry Yang.
May 3, 2008
Mr. Jerry Yang
CEO and Chief Yahoo
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089
Dear Jerry:
After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!.
I first want to convey my personal thanks to you, your management team, and Yahoo!'s Board of Directors for your consideration of our proposal. I appreciate the time and attention all of you have given to this matter, and I especially appreciate the time that you have invested personally. I feel that our discussions this week have been particularly useful, providing me for the first time with real clarity on what is and is not possible.
I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.
In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.
Also, after giving this week's conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.
We regard with particular concern your apparent planning to respond to a "hostile" bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:
-- First, it would fundamentally undermine Yahoo!'s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.
-- Given this, it would impair Yahoo's ability to retain the talented engineers working on advertising systems that are important to our interest in a combination of our companies.
-- In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid search provider in a manner that would reduce competition and choice in the marketplace.
-- This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo. In addition to whatever resulting legal problems, this seems unwise from a business perspective unless in fact one simply wishes to use this as a vehicle to exit the paid search business in favor of Google.
-- It could foreclose any chance of a combination with any other search provider that is not already relying on Google's search services.
Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft's proposal to acquire Yahoo!.
We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners.
I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table.
But clearly a deal is not to be.
Thank you again for the time we have spent together discussing this.
Sincerely yours,
/s/ Steven A. Ballmer
May 3, 2008
Mr. Jerry Yang
CEO and Chief Yahoo
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089
Dear Jerry:
After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!.
I first want to convey my personal thanks to you, your management team, and Yahoo!'s Board of Directors for your consideration of our proposal. I appreciate the time and attention all of you have given to this matter, and I especially appreciate the time that you have invested personally. I feel that our discussions this week have been particularly useful, providing me for the first time with real clarity on what is and is not possible.
I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.
In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.
Also, after giving this week's conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.
We regard with particular concern your apparent planning to respond to a "hostile" bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:
-- First, it would fundamentally undermine Yahoo!'s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.
-- Given this, it would impair Yahoo's ability to retain the talented engineers working on advertising systems that are important to our interest in a combination of our companies.
-- In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid search provider in a manner that would reduce competition and choice in the marketplace.
-- This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo. In addition to whatever resulting legal problems, this seems unwise from a business perspective unless in fact one simply wishes to use this as a vehicle to exit the paid search business in favor of Google.
-- It could foreclose any chance of a combination with any other search provider that is not already relying on Google's search services.
Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft's proposal to acquire Yahoo!.
We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners.
I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table.
But clearly a deal is not to be.
Thank you again for the time we have spent together discussing this.
Sincerely yours,
/s/ Steven A. Ballmer
Tuesday, April 29, 2008
Turning Positive
Based on the recent headlines it appears the market may be turning positive again. You be the judge:
Stocks Ready for Better Times?
The Building Blocks of a Stock Rally
Stabilizing Signs in Housing
The Bulls are Back
Monday, April 28, 2008
The World's Most Innovative Companies
Business Week has released it's list of the fifty most innovative companies in the world. Most of these are not a big surprise but it is interesting to look over the list and then research the stock activity over the past few months. Many of the innovative companies are more resilient to a down turn in the market. Here are the top few from each category:
Financial - GS, BOA, C
Pharma/Biotech/Health care - PFE, MRK, DNA
Technology/Telecom - AAPL, GOOG, ATT
Entertainment/Media - DIS, AAPL, NWS
Consumer Products - AAPL, PG, SNE
Autos - TM, GM, Tata Group (Private)
Industrial/Manufacturing - GE, MMM, BA
Retail - WMT, TGT, AMZN
Energy - BP, XOM, Royal Dutch Shell (Private)
Travel/Tourism/Hospitality - MAR, Hilton Hotels (Private), Virgin Group (Private)
A few that I think should have been added to the list or further up on the list are: AXP, PEP, NTDOY, CHK, & ERTS. Sorry for not linking the stocks, but you can pull them up here if you would like...
Financial - GS, BOA, C
Pharma/Biotech/Health care - PFE, MRK, DNA
Technology/Telecom - AAPL, GOOG, ATT
Entertainment/Media - DIS, AAPL, NWS
Consumer Products - AAPL, PG, SNE
Autos - TM, GM, Tata Group (Private)
Industrial/Manufacturing - GE, MMM, BA
Retail - WMT, TGT, AMZN
Energy - BP, XOM, Royal Dutch Shell (Private)
Travel/Tourism/Hospitality - MAR, Hilton Hotels (Private), Virgin Group (Private)
A few that I think should have been added to the list or further up on the list are: AXP, PEP, NTDOY, CHK, & ERTS. Sorry for not linking the stocks, but you can pull them up here if you would like...
Ben Bernanke
The Fed's upcoming policy-setting meeting this week has left investors a little shaky. It has been widely anticipated that the Fed is going lower interest rates an additional quarter point to 2%, but inflation concerns may keep the interest rate flat. The acquisition news released today regarding Mars Inc's purchase of Wm. Wrigley Jr. Co. for a reported $23 billion dollars has done little to excite the market. So once again the fate of the market lies in the hands of Ben Bernanke. Here are a few facts about our friend Big Ben:
- Born in Agusta Georgia in 1953
- Taught himself calculus
- Received a 1590 out of 1600 on his SAT
- Received an undergraduate degree from Harvard with a BA in economics in 1975
- Received a PhD from MIT in 1979
- Taught at Stanford Graduate School of Business, New York University, and Princeton University
- Joined the Board of Governors of the Federal Reserve System in 2002
- Appointed Chairman of the Federal Reserve on Febuary 1, 2006, by President Bush
Sunday, April 27, 2008
Apple on Wallstrip... Again
Tuesday, April 22, 2008
Presidential Pay
Does George need a pay raise? Lets take a look...
For 2007 George and Laura Bush had taxable income totaling $719,274 while the average CEO compensation was $15,200,000 from the 500 largest US Companies. The United States government is arguable the largest company in the world, so why isn't the president compensated adequately? As a percentage of our GDP even our current president is a steal. Granted Air Force One is pretty sweet, but maybe if we were to raise the compensation package for presidents we would attract more qualified candidates. Just a thought...
For 2007 George and Laura Bush had taxable income totaling $719,274 while the average CEO compensation was $15,200,000 from the 500 largest US Companies. The United States government is arguable the largest company in the world, so why isn't the president compensated adequately? As a percentage of our GDP even our current president is a steal. Granted Air Force One is pretty sweet, but maybe if we were to raise the compensation package for presidents we would attract more qualified candidates. Just a thought...
Friday, April 18, 2008
Tech & Oil
Technology stocks were on fire today thanks to Google posting stellar earnings last night. My fruit of choice is Apple which jumped 6 bucks putting me well back into the green on this stock. I bought Apple in the 120's and up to the 170's so my cost basis is around 150. Financials still look gloomy, but tech and natural resources are looking strong. With gas prices well above 3 bucks a gallon look for Exxon to post record earnings on May 1st. XOM has been hovering around $90 a share for a while so look for some movement when earnings hit. It may jump above $100 a share. All and all a pretty strong week for the markets. Hope we can keep this momentum heading into next week. Have a great weekend.
Thursday, April 17, 2008
Moving Forward
It is always important to reflect on the past to learn from mistakes and to understand how to react if encountered with a similar situation. With hindsight I would have liquidated with the dow at 14,000 and reentered when the dow hit 11,750, but how can you tell when the market is going to turn? With so much noise it is hard tell how the market is going to react in a volatile market. A month ago I was sure we would be sitting around 10,000, but the market has been surprisingly resilient and if you had sold at 11,750 you would be in a world of pain right now. When the market stays relatively bearish for a long period of time any glimmer of hope can cause a huge rally. Everyone wants to be bullish especially in a bear market. As a whole I believe most investors are intrinsically optimistic, but sometimes the few pessimists can ruin the party.
Google announced stellar earnings after hours today and the stock has bounced in after hours trading (currently up $76.42 or 17%). The news from Google should give tech a great jump in the opening tomorrow. Congrats to everyone holding GOOG!
Google announced stellar earnings after hours today and the stock has bounced in after hours trading (currently up $76.42 or 17%). The news from Google should give tech a great jump in the opening tomorrow. Congrats to everyone holding GOOG!
Wednesday, April 2, 2008
Recession Proof Trends
RIMM is blowing up in after hours trading! RIMM posted surprising quarterly results that blew away analysts expectations doubling prior years sales and profits.
Is RIMM recession proof? Hell no, but I love seeing stocks blow up on a day when Bernanke is scaring everyone with recession talk. RIMM is a great company with great products. They are getting a lot of attention from the consumer market thanks to the release of the Pearl and residual Apple customers. This is what Forbes has to say:
Riding on the coattails of Apple's iPhone, Blackberry maker Research In Motion late Wednesday posted surprisingly strong results for its latest quarter as consumers cottoned to smartphones of all stripes.
Research in Motion strategy is to expand into the retail consumer market and move away from its traditional dependence on corporations and government agencies. It has been seeking to woo general consumers with multimedia-heavy handsets such as the BlackBerry Pearl.
Sunday, March 30, 2008
Nike ID & Apple Update
I just got back from my first run with the NikeID (follow this link to see my latest run) iPod. I needed a reason to get off my couch and go for a run and the NikeID did the trick. It has been over a month since my last long run, so I was a little rusty.
Apple teamed up with Nike to produce the Nike ID. Let me take you through the process. First, you put the sensor in your shoe. You can use the Nike ID shoes that already have a slot for the sensor or you can cut a slot into any running shoes. Then you connect the adaptor to your iPod. That is about it, you are ready to go running. I ran only 2 miles at a snails pace of about 10 minutes a mile. The fun comes when you get home and get in front of a computer. After I stopped panting and chugging water I synced my iPod to my mac. It prompted me to go to the nike website and set up a profile. The site is really user friendly and shows your data in a pretty cool format. You can set goals and challenge your friends to competition.
So while I was out running I started thinking about apple and the recent downturn. What has changed in the past few months to substantiate such a downturn? The answer is simple, nothing! The management is still the same, the growth potential is still bright, and the product line is still elite. I am going to sit on my position, until I see a reason to sell (or it hits 200 bucks a share again). Tax day is almost here so I will be back up and blogging shortly. Sorry for the delay in posts.
Wednesday, March 12, 2008
S**t Happens
Sorry for the lack of posts. Work and wine have gotten in the way. I will get back in the grove soon. This article is hilarious! check it out...
Thanks to Skeeter for the link.
Thanks to Skeeter for the link.
Wednesday, February 27, 2008
Stuff the Mattress
Raising oil prices, crashing housing market, skyrocketing inflation, tightening credit, increasing unemployment, weak dollar....
It is really hard to be bullish in this market, unless you are long oil or the euro. I unfortunately am not.
Apple and Google are trading at unbelievably low forward p/e ratios. Google was trading close to $750 just six months ago and today it closed at $473! Apple was up over 200 not long ago and is now trading around $120. Lets look at the fundamentals and see if this is a good time to buy or if we should go to cash and stuff the mattress. Apples forward p/e is around 19! That is incredibly low for a growth company like apple. Net income has increased from 1.989 billion in 2006 (fiscal year end 9/30) to 3.496 in 2007! That growth is unbelievable. Analysts were projecting a one year target estimate at $250 a share a few months ago. Jobs said yesterday that he believes apple will hit the 10 million iPhones in 2008.
It is really hard to be bullish in this market, unless you are long oil or the euro. I unfortunately am not.
Apple and Google are trading at unbelievably low forward p/e ratios. Google was trading close to $750 just six months ago and today it closed at $473! Apple was up over 200 not long ago and is now trading around $120. Lets look at the fundamentals and see if this is a good time to buy or if we should go to cash and stuff the mattress. Apples forward p/e is around 19! That is incredibly low for a growth company like apple. Net income has increased from 1.989 billion in 2006 (fiscal year end 9/30) to 3.496 in 2007! That growth is unbelievable. Analysts were projecting a one year target estimate at $250 a share a few months ago. Jobs said yesterday that he believes apple will hit the 10 million iPhones in 2008.
Sunday, February 24, 2008
Earnings
There are some big companies reporting this week with almost certain volatility. Long or short?
Monday-
Lowe's Corporation (LOW)
Nordstrom (JWN)
Tuesday-
DISH Network Corporation (DISH)
Domino's Inc. (DPZ)
DreamWorks Animation SKG, Inc. (DWA)
Home Depot Inc (HD)
Radio Shack (RSH)
Target Corporation (TGT)
Wednesday-
Dollar Tree Stores (DLTR)
IHOP (IHP)
Limited Brands (LTD)
The Washington Post Company (WPO)
Thursday-
Dell, Inc. (DELL)
GAP, Inc. (GPS)
Hansen Natural (HANS)
Kohls Corporation (KSS)
Omnivision Technologies (OVTI)
Sears Holdings Corp (SHLD)
Monday-
Lowe's Corporation (LOW)
Nordstrom (JWN)
Tuesday-
DISH Network Corporation (DISH)
Domino's Inc. (DPZ)
DreamWorks Animation SKG, Inc. (DWA)
Home Depot Inc (HD)
Radio Shack (RSH)
Target Corporation (TGT)
Wednesday-
Dollar Tree Stores (DLTR)
IHOP (IHP)
Limited Brands (LTD)
The Washington Post Company (WPO)
Thursday-
Dell, Inc. (DELL)
GAP, Inc. (GPS)
Hansen Natural (HANS)
Kohls Corporation (KSS)
Omnivision Technologies (OVTI)
Sears Holdings Corp (SHLD)
Intuit
I finally got around to filing my taxes today! TurboTax makes it so easy to file a simple W-2 return, although it has it's limits. Intuit (INTU), the producer of QuickBooks, TurboTax, and Quicken, crashed on Friday (dropping over 9%) after releasing poor second quarter earnings after the bell on Thursday. TurboTax sales came in strong, but increased costs caused the bottom line to hurt. Increased competition from Microsoft's (MSFT) Office Accounting and Sage's Peachtree concerned Intuits management enough to cut earnings guidance for the remainder of the year.
Is this a buying opportunity or is this a turning point for a software giant? When Washington procrastinates on passing legislation to extend tax relief, the window to adjust, produce, package and ship the tax software shrinks. This process takes months of preparation so when a change comes in at the last minute the costs are going to be substantial.
Intuit has great products that are extremely user friendly. They are not for everyone, but for the average W-2 employee they do the job. I will keep my eye on this stock and if it drops down into the low twenties I may pick up a few shares.
Disclosure: No position
Sunday, February 17, 2008
Wednesday, February 13, 2008
Optimism
The market may be turning more optimistic with two days in a row with gains over 100 points. Buffett is buying and Yahoo is not selling indicates they believe the market is undervalued, or at least means there are some deals out there.
Retail led the surge today with both of my largest positions doing very well. AAPL & TASR both showed signs of strength today producing gains of 3.64% & 10.67% respectively. I am happy with the turn, but cautiously optimistic about claiming a turning point. Historically the market is very resilient, bouncing back quickly from downturns. My portfolio is still in the red YTD, but hopefully things will change in the second quarter.
Retail led the surge today with both of my largest positions doing very well. AAPL & TASR both showed signs of strength today producing gains of 3.64% & 10.67% respectively. I am happy with the turn, but cautiously optimistic about claiming a turning point. Historically the market is very resilient, bouncing back quickly from downturns. My portfolio is still in the red YTD, but hopefully things will change in the second quarter.
Monday, February 11, 2008
Slopes
Sorry for the delay in posts, I just got back from the slopes! It was a beautiful weekend and we had a blast. Catching up on some reading. Should be up to speed soon.
Wednesday, February 6, 2008
Limbo
How low will the markets go? Super Tuesday was not so super if you were long the market. The Fed suggested that they may be done lowering interest rates for a while due to inflation concerns. The Fed should have spread out the interest rate cuts over a period of time. Why drop the rate 125 points within eight days? I bet they would have achieved the same results by cutting the interest rate by 50 points on the scheduled meeting date. When the Fed shows its hand they better be prepared for the chaos to follow. The Fed should calm the markets while keeping inflation under control. We may be entering a period of stagflation which would include slow economic growth with rising unemployment. Stagflation coupled with a recession could lead to more crummy market days like we have had this week.
So, where am I going to put my money? I have been advised to stick any remaining funds under my mattress by a trusted source, but where is the upside to that? There are some bargains out there if you are willing to ride out the waves. I have made money in the past with these companies and still like them all.
1. Adobe (ADBE) - Tech has been taking a hit recently but adobe has some great products and should come back strong whenever this market turns.
2. Texas Instruments (TXN) - whenever you can get this stock under $30 buy it and hold it. Easy 15%.
3. Southwest Airlines (LUV) - this stock has a lot of buzz around the office and it has historically been a good earner
4. Garmin (GRMN) - approaching its 52 week low, this may be a great entry point on a strong growth stock
And a couple to gamble on:
5. Baidu (BIDU) - taking a dive now, but if you can find the bottom you may be in luck
6. Dicks Sporting Goods (DKS) - Trending upward, should go higher
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