Why The Profit Potential Of Corporate America Is THE Game In Town [View article]
The author was comparing the growth of U.S. corporate profits to the growth in U.S. GDP and U.S. personal consumption expenditures (PCE) - The comments do not affect his conclusion that profit growth has far outstripped the other two.
Applying dividend_growth's adjustment, the U.S. portion of profit growth is (5/8) x 130% = 86%.
Thanks DG - I put on our Reading List for tomorrow with a disclaimer that we had not researched the claims of the article. Posted with hat tip to doubleguns.
Quantitative Easing And The Great Market Correction? [View article]
Roger - - -
Ultimately the discussion devolves to what should be bailed out: Wall Street or Main Street. The course followed has had helicopter drops on Wall Street and relative little on Main Street. For example, most of those who have received compensation for having experienced fraudulent foreclosures have been compensated by payments around $300.
The country is still working on a trickle down hypothesis. Of course the money is going to job creators - Wall Streeters are creating greater employment opportunities for themselves and at higher income levels.
Has anyone analyzed the color of that which is trickling down?
Last week I posted a note that pointed out the long-term trend lines provide support in the $1,100 +/- right now. If we did get to those levels it would be a great time to make a big bet. http://seekingalpha.co...
Midday Monday 15 April - Gold is "hanging" at $1360 +/-. This is the bottom of a congestion region between 1,350 and 1,400 in late 2010 and early 2011. This could be the support level, or not.
If not the next major congestion (consolidation) level is in the 1,100s (late 2009 through first half of 2010) and this also is the vicinity of the 5- and 10-year trend lines. The move is half way to this ultimate support level from the 1,550 last seen two days ago.
We could stay where we are today for a while or the ultimate support could be tested this week. There is not much standing between 1,350 and the 1,100s if we break through 1,350..
General Electric: An Update On The Perfect Stock [View article]
Thanks for discussing GE.
I have not owned GE since first quarter 2008. It used to be one of my "heritage" holdings but as I sold out of the market in first half of 2008 with stop loss after stop loss hit, GE went the same way as everything else. It is looking interesting again.
Trailing PE at 18 is higher than I like, but forward PE is about 14 for 2013 and 13 for 2014. If we got a market correction of 10-20% and GE came down to $20 (-16%) the three PEs above become 15, 12 and 11, respectively. With estimated 3-5 year growth at about 10% per year, the PEG is approaching my buy target of 1.
If there were 10% growth for each earnings, price and dividends for 10 years, the 10-year return would be approximately $32 on the stock and $16 in dividends. That would be an average annual return of 13%.
If we allow for two years with no gains (years containing major market corrections and at least partial recovery) and hold through the entire ten year period the average annual return is reduced to 11%.
And if we have another secular bear market cycle? It is probably safe to assume a 3-4% average annual return based on the dividend and no capital gain over the next 10 years. That would happen if GE could maintain it's current price level 10 years from now and paid the current dividend every year.
GE has gained 12% YTD and 29% over the past 9 months. If there were a market correction of 10-20% a decline to $20 (or even below) is quite likely as recent buyers become motivated sellers to protect capital.
A good strategy would be to buy with limit order at $20 and add more at $19 and again at $18.
If we have a repeat of 2009 when the price went down below $7 I will probably not ignore GE as I did back then.
Would you buy a stock that has a projected growth rate between 10% and 20% per year over the next 3-5 years, a PE less than 10 (PEG < 1), a 2.5% dividend, only 12% payout, no debt and $56 billion in cash?
Does sound good, doesn't it?
I have been holding out for $350 but should probably open a partial position at $400 if I can catch that with a limit order.
In another discussion I suggested that I would really like to see a stiff market correction and buy at ~$260 (4% dividend). But that does sound a bit delusional doesn't it? Nonetheless I think $260 is within reach with current negative sentiment for AAPL if we had a 20% move down for the market. Such a move is overdue.
So I am going to figure out what my maximum exposure to AAPL should be and set up a strategy to buy 1/3, 1/3 and 1/3. If I only get the first 1/3 I should probably do just fine. But if I get all three entries it would be a great set-up.
Are You Expecting Oil Prices To Fall? [View article]
Thanks, Alex. I checked the Suncor report and other literature from them and could not find any statements defining how much of their production is surface mining and how much is deeper in situ extraction (SAGD). I did find a statement that 20% of the reserves are accessible by surface mining and 80% are too deep and will required SAGD or follow-on improved deep well methods.
Also found a statement that indicates their production costs are falling.
Why The Profit Potential Of Corporate America Is THE Game In Town [View article]
Applying dividend_growth's adjustment, the U.S. portion of profit growth is (5/8) x 130% = 86%.
This is still 6x PCE and 8x GDP growth.
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
Can you give a link for the $160,000 number? Thanks.
Hindenburg Omen - November 13, 2012 [View instapost]
Posted with hat tip to doubleguns.
Quantitative Easing And The Great Market Correction? [View article]
Ultimately the discussion devolves to what should be bailed out: Wall Street or Main Street. The course followed has had helicopter drops on Wall Street and relative little on Main Street. For example, most of those who have received compensation for having experienced fraudulent foreclosures have been compensated by payments around $300.
The country is still working on a trickle down hypothesis. Of course the money is going to job creators - Wall Streeters are creating greater employment opportunities for themselves and at higher income levels.
Has anyone analyzed the color of that which is trickling down?
Hindenburg Omen - November 13, 2012 [View instapost]
Last week I posted a note that pointed out the long-term trend lines provide support in the $1,100 +/- right now. If we did get to those levels it would be a great time to make a big bet.
http://seekingalpha.co...
Hindenburg Omen - November 13, 2012 [View instapost]
I'll send an email when we post this evening. I won't grab it until 7pm EST. If you make any updates before then I'll have them.
Hindenburg Omen - November 13, 2012 [View instapost]
Gold In The Danger Zone [View instapost]
If not the next major congestion (consolidation) level is in the 1,100s (late 2009 through first half of 2010) and this also is the vicinity of the 5- and 10-year trend lines. The move is half way to this ultimate support level from the 1,550 last seen two days ago.
We could stay where we are today for a while or the ultimate support could be tested this week. There is not much standing between 1,350 and the 1,100s if we break through 1,350..
Hindenburg Omen - November 13, 2012 [View instapost]
Gold In The Danger Zone [View instapost]
Gold down almost $60 this morning. Guess we'll find out where support is soon. :-)
John
General Electric: An Update On The Perfect Stock [View article]
I have not owned GE since first quarter 2008. It used to be one of my "heritage" holdings but as I sold out of the market in first half of 2008 with stop loss after stop loss hit, GE went the same way as everything else. It is looking interesting again.
Trailing PE at 18 is higher than I like, but forward PE is about 14 for 2013 and 13 for 2014. If we got a market correction of 10-20% and GE came down to $20 (-16%) the three PEs above become 15, 12 and 11, respectively. With estimated 3-5 year growth at about 10% per year, the PEG is approaching my buy target of 1.
If there were 10% growth for each earnings, price and dividends for 10 years, the 10-year return would be approximately $32 on the stock and $16 in dividends. That would be an average annual return of 13%.
If we allow for two years with no gains (years containing major market corrections and at least partial recovery) and hold through the entire ten year period the average annual return is reduced to 11%.
And if we have another secular bear market cycle? It is probably safe to assume a 3-4% average annual return based on the dividend and no capital gain over the next 10 years. That would happen if GE could maintain it's current price level 10 years from now and paid the current dividend every year.
GE has gained 12% YTD and 29% over the past 9 months. If there were a market correction of 10-20% a decline to $20 (or even below) is quite likely as recent buyers become motivated sellers to protect capital.
A good strategy would be to buy with limit order at $20 and add more at $19 and again at $18.
If we have a repeat of 2009 when the price went down below $7 I will probably not ignore GE as I did back then.
Apple: Too Cheap To Ignore? [View article]
Does sound good, doesn't it?
I have been holding out for $350 but should probably open a partial position at $400 if I can catch that with a limit order.
In another discussion I suggested that I would really like to see a stiff market correction and buy at ~$260 (4% dividend). But that does sound a bit delusional doesn't it? Nonetheless I think $260 is within reach with current negative sentiment for AAPL if we had a 20% move down for the market. Such a move is overdue.
So I am going to figure out what my maximum exposure to AAPL should be and set up a strategy to buy 1/3, 1/3 and 1/3. If I only get the first 1/3 I should probably do just fine. But if I get all three entries it would be a great set-up.
Weekly Summary: Sequester Is NOT The Big Story [View instapost]
He is. The reason? To increase FICA receipts. (Sarcasm.)
BTW, the increase in FICA by 2% on 01 January accounts for half of the 4% plus decline in personal income.
A bigger mystery to me is the 4% + spike up at the end of 2012. Perhaps someone can suggest where that came from?
Are You Expecting Oil Prices To Fall? [View article]
Also found a statement that indicates their production costs are falling.