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Omar Farooq

 
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  • Go Where It Is Darkest: When Company, Country, Currency And Commodity Risk Collide! [View article]
    Great risk analysis!
    Nov 22, 2014. 08:00 AM | Likes Like |Link to Comment
  • Five Takeaways From Capital One's Earnings [View article]
    Well written article. I apreciate the financial math as well. Let's hope the market sees the error and the price appreciates.

    How would you compare COF to other bank stocks like JPM, C, BAC, or WFC? It often gets compared to DFS, but I think DFS has a toll booth element that COF lacks so it should trade at a slight premium to COF because of COF's (small) credit risk.
    Oct 28, 2014. 06:42 AM | Likes Like |Link to Comment
  • We Are In A Secular Bull Market [View article]
    Interesting point, but what about the effects of immigration? Demographics is not the sole reason we're in a bull market today, although your points + the effects of immigration are (in my opinion) positive drivers for the economy today.
    Sep 17, 2014. 08:27 AM | Likes Like |Link to Comment
  • Can Amazon Rally Again? [View article]
    Unless you're saying that Amazon can't maintain its revenue without spending as much as it does now, why wouldn't its profits go up if it cut back on expansion spending (once they've saturated the markets they're trying to get into)?

    There are plenty of companies that spend most of their revenue on trying to grow as fast as possible. When their market matures, there's no more reason to keep spending on diminishing returns and these companies start issuing dividends. Just because Amazon has been around for nearly 20 years doesn't mean it has to slow down its growth.

    The problem is, its pretty tough to calculate a fair value on growth stocks because the future is so volatile for these companies. Its mostly a psychology evaluation - Amazon continues to grab headlines, so I think the market won't be ready to discount its growth story for a while.
    Jul 2, 2014. 12:35 PM | 1 Like Like |Link to Comment
  • Can Amazon Rally Again? [View article]
    I think the author's argument is that Amazon's P/E ratio is misleading because its spending almost everything it makes to increase revenue growth. It could cut-down on investing in growth and massively boost earnings, thereby dropping the P/E ratio to something more rational.

    I don't think people are buying Amazon stock for traditional P/E fundamentals.

    Once e-commerce is a more mature market, then you might see expenses coming down and AMZN would be valued completely differently.
    Jul 2, 2014. 07:26 AM | 3 Likes Like |Link to Comment
  • The Signal And The Noise [View article]
    Typically commodities do well in late-stage economic cycles and rising inflation.

    Oil (already up due to geopolitical tensions)
    Copper/Aluminum/Steel (suppressed due to China's economy slowing down)
    Gold/silver (rebound from last year's drop)
    Platinum/Palladium - (already up due to supply concerns - likely more legislation worldwide to promote use of catalytic converters).

    Consumer Staples might be a safe place to invest as well. They won't drop as much as other sectors should the economy stumble.

    I'd watch out for Utilities - they've shot up this year and are very debt-heavy industries. Not a good place to be in as rate go up to historic levels.

    Telecom's have similar issues in a saturated market - but they haven't apreciated much so they not as much to fall.

    My 2-cents...
    Jun 26, 2014. 03:25 AM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    No argument from me. I guess I see the economy being strong enough to justify a small nudge higher in rates next year. I don't see that happening in Europe for a few years - so they will try some QE and maybe I can pick up some gains in their equities as well.
    Jun 24, 2014. 11:22 AM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    Microsoft, Oracle, Qualcomm, Cognizant, and United Health might say that we don't have enough immigration...

    There's plenty of talent that we're importing through H-1B visas - I'd rather have smart people coming to the U.S. and growing our economy despite a surge in baby-boomers retiring.
    Jun 24, 2014. 11:21 AM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    A fair point cpa - I wasn't neccessarily trying to pick foreign stocks that are cheaper than their American counterparts. I'm trying to find companies that I feel will apreciate faster than their American counterparts in their relevant sector - due to stimulus programs or GDP growth within their respective countries. That's why I used charts showing YTD returns between a U.S. equity and a foreign equity that I wrote about.
    Jun 24, 2014. 04:24 AM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    Dweebster, thanks for your comment - I think an ETF would be a good recommendation for anyone wanting to invest in any sector/region without wanting to equity analysis. If you want to exceed the market, you can try to find stocks that have strong growth prospects and aren’t overvalued. That was what I attempted to do with my picks in this article.
    Jun 24, 2014. 04:18 AM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    Thanks Bobbo - I think you have a fair point that international large-cap stocks tend to be fairly correlated with U.S. equities.

    However, companies in the energy and basic materials sectors tend to be more sensitive to China's economy than the U.S.'s.

    Also, I think that the U.S. market pulled ahead of its foreign peers by a large margin in 2013 due to QE. Now that we're winding ours down, and Europe and Japan are cranking theirs up, I think companies in those markets have a chance to perform better this - and maybe - next year. I think Santander's sharp recovery over the past year is a good example.
    Jun 23, 2014. 09:25 PM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    Good point - European and Asian companies tend to make annual payments instead of quarterly payments. Sometimes its twice a year and the payments are not necessarily similar. However, if you're supplementing these ADRs to a domestic portfolio, you will probably end up pulling dividends throughout the year anyways.
    Jun 23, 2014. 09:20 PM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    Thanks Guraaf - Its difficult to find quality stocks yielding more than 4% these days. However, I did provide several examples of stocks with low P/E.

    Look at these five stocks with a P/E of less than 15:

    (TM) - P/E of 10.4
    (VOD) - P/E of 4.55 - also yields more than 4%
    (BHP) - P/E of 12.41
    (TOT) - P/E of 13.34
    (HNP) - P/E of 8.94
    Jun 23, 2014. 09:18 PM | Likes Like |Link to Comment
  • Want To Find Alpha In This Market? Invest Abroad [View article]
    Thanks HoD - I believe that foreign dividends can be reimbursed by the IRS on a form 1116 (http://1.usa.gov/MlL1uW).

    Also, some countries don't withhold taxes or have tax treaties with the US (like the UK).

    You make a good point though, that results will strongly vary by broker - its key to have a good broker when it comes to investing abroad. I have not had issues with tax treaty countries with my broker (Interactive Brokers).
    Jun 23, 2014. 01:06 PM | Likes Like |Link to Comment
  • The VIX Is All Right [View article]
    The greater the risk the greater the reward (within reason)... ;)
    Jun 23, 2014. 10:27 AM | Likes Like |Link to Comment
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