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Ray Merola  

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  • Celgene Has Plenty Of Mojo Left: But Don't Get Greedy [View article]
    Good point, cachry

    If management continues to maintain it's earnings forecast, the additional of new compounds and more certainty around out-year estimates have the potential to keep the target price moving up.

    Few companies offer investors a glimpse at what it believes EPS will look like 5 years into the future. Celgene's senior staff has a good track record, bolstering the claims.
    Mar 24, 2015. 03:55 PM | 1 Like Like |Link to Comment
  • Celgene Has Plenty Of Mojo Left: But Don't Get Greedy [View article]
    Thanks for a great acknowledgement, jpm4847. We both like CELG prospects; it was one of my better picks in early 2014.
    Mar 24, 2015. 03:53 PM | 2 Likes Like |Link to Comment
  • Celgene Has Plenty Of Mojo Left: But Don't Get Greedy [View article]
    Thank you, markone, for those very kind words. I try to write so even I can understand it!
    Mar 24, 2015. 03:47 PM | 3 Likes Like |Link to Comment
  • Celgene Has Plenty Of Mojo Left: But Don't Get Greedy [View article]
    scottydpgh

    You've notice 2 important nuances in the article.

    First, Celgene management told investors their forecast did not include any credit for compounds not yet under development. By 2020, it would seem unlikely the resultant will be zero.

    Second, while my fair value and target prices were based upon earnings multiples, the fact that the Company generates more operating cash (and even free cash flow!) than profits suggests that a 23x multiple isn't aggressive at all. The P/CF ratio would be LOWER.
    Mar 24, 2015. 03:45 PM | 2 Likes Like |Link to Comment
  • Celgene Has Plenty Of Mojo Left: But Don't Get Greedy [View article]
    Jonathan

    You have pointed out another entirely rationale way to evaluate CELG shares. The key is to look to the "out years." Looking at Current Year or backwards will yield results whereas the stock always seems overpriced.
    Mar 24, 2015. 03:42 PM | 3 Likes Like |Link to Comment
  • Celgene Has Plenty Of Mojo Left: But Don't Get Greedy [View article]
    Thank you!
    Mar 24, 2015. 03:40 PM | Likes Like |Link to Comment
  • Mr. Valuation's Best Ideas For Retirement And Dividend Growth Portfolios: Emerson Electric [View article]
    AaronFunding

    Appreciate the acknowledgement. Indeed, I encourage each investor to develop his/her own style. Trying to copy others' style, even the investment masters, is rarely appropriate.

    There are various investment philosophies and portfolio management techniques. Any of these can work.

    The bottom line: long-term results.

    Mar 22, 2015. 09:48 AM | 3 Likes Like |Link to Comment
  • Quack, Quack, I Just Bought Aflac [View article]
    Dividend Dreams and CapeCapMgt,

    Thank you for referencing my recent Aflac article published on S.A.

    DD offered sound, well-articulated points about Aflac. I believe company management is among the industry's best-of-breed. The Amos family and associates are highly experienced, make commitments to investors, and follow-up on those promises. I contend this is a key attribute and part of my AFL investment thesis.
    Mar 22, 2015. 09:25 AM | 3 Likes Like |Link to Comment
  • Mr. Valuation's Best Ideas For Retirement And Dividend Growth Portfolios: Emerson Electric [View article]
    Steve

    Great question. My personal investment style is to limit the number of securities I own. My core portfolio is ~15 stocks, diversified among Sectors, but not necessarily in equal proportions. Typically, I may have a handful of others that I'm either distributing out of or legging into.

    This does 2 things for me.

    One, it forces me to be selective and rank investments; make tough choices. Otherwise, I might have a tendency to end up with dozens of stocks. Then I might as well just buy an ETF and be done with it. Limiting stocks forces discipline.

    Two, I believe sound research and follow-up builds strong portfolios. I allocate at least an hour per week per stock. Limiting the number of total securities keeps my portfolio manageable from a time perspective. I do not want to get spread too thin, thereby risking returns because I fail to keep up with the due diligence.

    Given my personal approach, I still could find a way to invest in both ETN and EMR. However, it would require me to begin to scale out of of something else to "make room" for 2 securities that are somewhat similar in nature.

    Indeed, I've currently done something along the lines of what you've asked me about, but in another sector. I see some unusual bargains in the Energy business. I've bunched a few names together (same energy sector, but different industries) to take advantage of what I believe are particular long-term winners. Long RDS, EOG, HAL and ETE (integrated energy, domestic upstream, oilfield services, and midstream / downstream MLP).
    Mar 21, 2015. 02:32 PM | 3 Likes Like |Link to Comment
  • Mr. Valuation's Best Ideas For Retirement And Dividend Growth Portfolios: Emerson Electric [View article]
    Fine article, Chuck. Thank you.

    Emerson has been on my watch list for awhile, as a potential substitute for Eaton Corporation and CEO Sandy Cutler. I've owned ETN shares for years. Both these fine Industrial sector companies with some similar business interests.

    I have not been moved to migrate out of ETN and toward EMR yet. Eaton may not appear quite as undervalued as Emerson, but has better forward growth prospects. Yields are comparable. Emerson may have a little better balance sheet today, but Eaton is focused upon quickly returning to a primo balance sheet post-Cooper acquisition and is far ahead of schedule. Debt-to-Cap is still only about 32% today.

    FAST graphs help beginning to evaluate the two simple and quick.
    Mar 21, 2015. 10:36 AM | 1 Like Like |Link to Comment
  • Union Pacific Struggles To Grow Revenue In Q1 [View article]
    Good move on Apple, Michael.

    I like to think I'm just working around the edges of a position versus timing? I'm not really very good at market timing, either. With my view of a fair value target in hand, I generally distribute a few shares if a stock commands a price utilizing estimated EPS at least 2 years' out, or a 25% gain.

    For me, Union Pacific is a core position. Well-managed, strong franchise, good balance sheet, earn profits largely in cash, shareholder-friendly, and pays a solid dividend.

    Looking forward to your next article.
    Mar 21, 2015. 09:56 AM | Likes Like |Link to Comment
  • Aflac Is Undervalued In This Hot Market: Don't Buck The Duck [View article]
    Thank you for the kind words, Kyle from Vancouver

    Interesting perspective and comment about QE.

    QE has may have distorted some valuations. However, Aflac's portfolio is composed of securities from all over the world; though much in the U.S., Japan and Europe, the epicenters of aggressive monetary easing.

    I'm not convinced that QE is a major headwind for insurers. Major banks like Wells Fargo and U.S. Bancorp have managed just fine with tight margins and QE.

    As for many financial institutions, I see the big headwind in the form of historically low interest rates and margins. I do not see this condition as permanent.

    Even if potentially distorted asset values are a problem, and this problem is gradually fixed via central bank QE reversals; would not insurers like Aflac see multiple expansion upon a "return to normal?"
    Mar 20, 2015. 11:31 PM | 1 Like Like |Link to Comment
  • Union Pacific Struggles To Grow Revenue In Q1 [View article]
    Fine article, Michael

    I've likewise advocated UP as the "best of breed" North American railroad.

    Appreciate your insights and interpretations of the underlying business and go-forward drivers.

    Believe the shares are a bit over fair value today. I trimmed back a full position between $112 and $120 to a half position; waiting for a chance to buy back on a pullback in the low $100s.
    Mar 20, 2015. 11:19 PM | Likes Like |Link to Comment
  • Celgene: An Absolutely Excellent Company With An Absolutely Terrible Valuation [View article]
    Tim

    I understand your thinking on this, but respectfully disagree with the input data and process conclusions. Celgene is one of the 9 stocks I picked for success in early 2015 under a "continued mojo" subheading.

    I'm working on the S.A. follow-up article that will delve into the fundamentals and metrics for CELG; as well as a valuation exercise. I plan to submit it to the editors within the next few days.

    Here's a teaser: I believe the stock represents reasonable value at $128; and it was a steal at $115, the 2015 swing low.
    Mar 20, 2015. 05:24 PM | 7 Likes Like |Link to Comment
  • Halliburton: The Bottom Might Be In [View article]
    Thank you for the explanation, 31Oct. HAL riding up with the market today; management is talking about selling assets to ensure a successful BHI merger.
    Mar 20, 2015. 12:33 PM | Likes Like |Link to Comment
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