Fast Money is one of the best financial talk shows on air. The Fast Money crew try to guide investors with stock suggestions. I regularly follow the show, and analyze their stock picks further. I have investigated all of these stocks from a fundamental perspective, adding my opinion about them. I have applied my O-Metrix Grading System where possible. Here is a fundamental analysis of these stocks from Fast Money: (Data obtained from Finviz/Morningstar, and is current as of Sept. 22)
Southern Company (SO): Steve Cortes suggests going long with the Southern Company. "I love dividends and domesticity. Stay in the US," he says.
The stock was trading at a P/E ratio of 17.6, and a forward P/E ratio of 15.4, as of the Sept. 22 close. Analysts expect the company to have an 5.91% annualized EPS growth in the next five years. With a profit margin of 11.3%, shareholders enjoyed a 4.44% dividend last year. It is trading only 3.02% lower than its 52-week high. Target price implies a 0.2% downside potential, while it returned 11.7% in a year. ROA and ROE are 3.65% and 12.02%, respectively. Profit margin and ROE (12.0%) are moderate green flags. Operating margin is 3.13%, whereas it has an O-Metrix score of 3.53. Average analyst recommendation for Southern Company is 2.50 (1=Buy, 5=Sell). Here is the recent dividend history of SO:
07/28/11 | $ 0.47 |
04/28/11 | $ 0.47 |
02/03/11 | $ 0.45 |
10/28/10 | $ 0.45 |
General Mills Inc. (GIS): Guy Adami suggestd going long with General Mills.
The stock was trading at a P/E ratio is 14.3, and a forward P/E ratio of 13.08, as of the Sept. 22 close. Analysts expect the company to have an annualized EPS growth of 7.39% in the next 5 years. Profit margin is 12.1%, and it offered a 3.17% dividend last year. The company had an EPS growth of 20.77% this year, and 56.86% this quarter. O-Metrix score is 3.7, and it is trading 1.68% lower than its 52-week high. Target price is $41.06, indicating a 0.5% increase potential. SMA20 and SMA50 are 4.21% and 5.25%, respectively. SMA200 is 6.38%, and institutions own 71.26% of the shares. The company returned 0.6% in a year. Debt-to assets ratio is 0.8, far better than the industry average of 1.3. Gross margin and operating margin are 40.00% and 18.6%, respectively. I think General Mills will continue to generating cash flows over the longer term. Here is the recent dividend history of General Mills:
07/07/11 | $ 0.30 |
04/07/11 | $ 0.28 |
01/06/11 | $ 0.28 |
10/06/10 | $ 0.28 |
Apple (AAPL): Joe Terranova says ‘’Apple is working , utilities are working, and so is select consumer discretionary.
The stock was trading at a P/E ratio of 16.3, and a forward P/E ratio of 12.2, as of the September 22th close. Analysts expect the company to have an 20.85% annualized EPS growth in the next five years. Apple has no dividend policy, while the profit margin was 23.5% in 2010. The company had a 122.15% EPS growth this quarter, and 66.91% this year. Sales increased by 81.98% this quarter. O-Metrix score of Apple is 7.34, while it returned 45.8% in a year. Target price implies a 22.9% upside potential, and it is trading just a 5.41% lower than its 52-week high. SMA50 is 9.68%, and SMA200 is 19.40%. ROA and ROE are 27.53% and 41.99%, respectively. Operating margin is 30.4%, while institutions hold 70.42% of the shares. The company has no debts for the last five years, and cash flow is ok. Moreover, it has a five-star rating from Morningstar. I think Apple is going for a trillion dollar market cap by 2020. (Read a full analysis of Apple here.)
Freeport-McMoRan Copper & Gold Inc. (FCX): Gay Adami says says if the S&P can hold these key levels, Freeport McMoRan may be worth a look, it’s trading at 2-years low.
The stock, as of the Sept. 22 close, shows a P/E ratio of 6.1, and a forward P/E ratio of 5.1. Estimated annual EPS growth for the next five years is 8.10%. With a profit margin of 25.1%, shareholders enjoyed a 2.81% dividend last year. Earnings increased by 103.87% this quarter, and 55.90% this year. It has an O-Metrix score of 7.09. Target price is $63.86, indicating a 99.1% increase potential. The stock is currently trading 48.19% lower than its 52-week high, while it returned -7.6% in the last twelve months. While gross margin is 53.06%, operating margin is 50.7%. Debt-to equity ratio is 0.2, far better than the industry average of 0.4. ROA, ROE, and ROI are 19.78%, 44.68% and 31.45%, respectively. Debt-to equity ratio is 0.6, way better than the industry average of 2.6. Analysts give a 2.0 recommendation for Freeport-McMoRan (1=Buy, 5=Sell). Recent dividend history is as follows:
07/13/11 | $ 0.25 |
04/13/11 | $ 0.25 |
02/02/11 | $ 2: 1 Stock Split |
01/12/11 | $ 0.25 |
FedEx Corporation (FDX): Zach Karabell recommends FedEx Corporation.
The stock was trading at a P/E ratio of 15.9, and a forward P/E ratio of 8.8, as of the Sept. 22 close. Analysts expect the company to have an annualized EPS growth of 15.49% in the next 5 years. Profit margin is 3.7%, and it offered a 0.72% dividend last year. Earnings increased by 21.43% this year, and 32.73% this quarter. Institutions own 77.32% of the shares. O-Metrix score is 6.5, whereas it returned -7.8% in the last twelve months. The stock is trading 33.72% lower than its 52-week high, while target price indicates a 59.4% upside movement potential. Average analyst recommendation for FedEx is 2.00 (1=Buy, 5=Sell). I think FedEx will employ its competitive advantages in course of time. Moreover, it has a four-star rating from Morningstar. Recent dividend history is as follows:
09/08/11 | $ 0.13 |
06/15/11 | $ 0.13 |
03/16/11 | $ 0.12 |
11/18/10 | $ 0.12 |
Disclosure: I am long AAPL.
