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Ricardo Espinosa

 
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  • June Philly Fed Business Outlook: -16.6 vs. an expected 0 (consensus range -3.0 to 4.0) and May's -5.8. Overall declines indicated as general activity, new orders, shipments, average work hours were all negative.  [View news story]
    No QE for a month, it already had its twist yesterday, Mr. Market is grounded.
    Jun 21, 2012. 10:29 AM | 2 Likes Like |Link to Comment
  • Volatility Players: Mind The Gap [View article]
    Shorting XIV when VIX is at levels when it was 2-3 months ago would be great.
    Jun 20, 2012. 07:00 PM | Likes Like |Link to Comment
  • Reviewing Piotroski's F-Score: Method, Results, And 10 Stock Ideas [View article]
    That´s very true, the past can be just a barometer, it cannot be a promise for future earnings, be very careful when reviewing financial data and forward-looking statements, those 10 were just 10 stocks that scored 9 on Piotroski´s score, may be a bit old considering the DYNT de-listing. LZB´s revenue miss does not look very good, haven´t dived into reports though.
    Jun 20, 2012. 05:20 PM | Likes Like |Link to Comment
  • Reviewing Piotroski's F-Score: Method, Results, And 10 Stock Ideas [View article]
    There´s bound to be one, I haven´t found a free one, but I´ve found 3 that you pay membership for, haven´t tried them though, I´ll look for companies along with my valuations-so keep on tuned, I´ll leave you 3 links for the paid memberships:
    http://bit.ly/MJKApC
    http://bit.ly/LhMaTy
    http://bit.ly/MJKApE
    Jun 18, 2012. 10:56 PM | Likes Like |Link to Comment
  • Reviewing Piotroski's F-Score: Method, Results, And 10 Stock Ideas [View article]
    Excellent addition to the article Kurtis, and great link, you can see there YTD Piotroski´s High F-Score stocks have yielded 52.3% return, the strongest model so far.
    Jun 18, 2012. 01:16 PM | Likes Like |Link to Comment
  • The G20, which is due to start a two-day parley in Mexico tomorrow, could agree to increase the IMF's firewall beyond the $430B agreed upon in April, Mexican President Felipe Calderon says. That's despite the U.S. and Canada not providing any of the funds. Other than that, guess what everybody will be talking about.  [View news story]
    US not providing any of the funds? Well the Fed is not part of the US, is it? They will change their tune and turn on the virtual printing press whenever Mr. Market throws a real tantrum and expected growth and economic outlook shifts to negative.
    Jun 18, 2012. 01:34 AM | 1 Like Like |Link to Comment
  • The South Korean government slashes its 2012 GDP growth forecast to 3.4% from 3.7% as the slowdown in developed economies and the EU crisis are "more serious than expected."  [View news story]
    3.4% is still decent, as long it is above inflation;and comparing it to both Europe and US.
    Jun 18, 2012. 01:30 AM | Likes Like |Link to Comment
  • Caterpillar: Share Valuation By 4 Methods [View article]
    Excellently put Daniel, these are mainly tools of reference, not a bible by any means, for any investor to gauge if they are overpaying or getting a good price for any given stock.
    Stock purchasing IS an auction, and as with anything, housing prices, art prices, the object will go to the highest bidder, but these kind of analysis can give you at least some ranges where a stock might be a good buy/short within 12 months.
    Many value investors do use these methods for valuing stocks, and it has been proven that a superior company will provide positive returns over a 1-5 year holding periods.
    In my next article I will talk about one of my favorite methods of gauging a company´s strength, developed by Piotroski, the F_Score. In his paper, he proved that stocks with a high F_Score (8 and 9) outperformed the S&P by 23% over a 20 year period (1975 to 1995), and stocks with a low F_Score underperformed the S&P by 51%. Admittedly, that score is not in this article but I will cover it within the following weeks, comparing CAT, DE and NAV.
    Also, the market can stay irreverent longer than you or I can stay solvent, so it´s always a prediction and guessing game when it comes to stocks.
    I do think stronger companies will, over the mid and long-term (1-5 years) outperform their weaker peers. There will always be exceptions, as weak companies can provide greater returns as long as they´re "hot" (think FB, FSLR and many others); but as they´re overvalued and the market catches on to weaker business models, the stock comes crashing down to reality (like GMCR, EK, NFLX, RIMM, JVA, NOK, etc).
    Opposite thinking enriches us the most, thanks for your input.
    Jun 15, 2012. 04:22 PM | 1 Like Like |Link to Comment
  • Jesus, Bob Dylan And Expected Returns: 8 Indicators Of Long-Term Equity Returns [View article]
    Excellent work Bard, nice to see the big picture expected returns so clearly.
    Jun 15, 2012. 01:31 PM | 1 Like Like |Link to Comment
  • SodaStream: Get Ready For Liftoff [View article]
    You just gave me a great valuation idea, SODA shall be valued soon! Nice article Krause.
    Jun 15, 2012. 11:07 AM | Likes Like |Link to Comment
  • John Deere: Valuation Of Share Price By DCF And Analysis Of Metrics [View article]
    True, the financing part of DE was a minor headache reading through their 10k, but since the parts are so interconnected; financing is a very important part of their operations, which helps their core business, so I wouldn´t put them as separate economic entities. It does change the leverage ratio and profitability, but since it´s all within the same company, you have to take all the moving parts.
    Jun 15, 2012. 10:55 AM | Likes Like |Link to Comment
  • John Deere: Valuation Of Share Price By DCF And Analysis Of Metrics [View article]
    Ivar: Thanks for pointing it out, the formula was used like that, (ROIC-WACC)= Economic spread, which is 1.8% * Capital Employed =$0.512 billion. The mistake was only on the formula I wrote, not the one I used, thanks for reading.
    Jun 15, 2012. 10:52 AM | Likes Like |Link to Comment
  • Caterpillar: Share Valuation By 4 Methods [View article]
    Thanks sandy, much appreciated. It´s almost done and a lot more complete. It´s about DE.
    Jun 14, 2012. 04:59 PM | Likes Like |Link to Comment
  • Caterpillar: Share Valuation By 4 Methods [View article]
    I´m aware of that, and I suggest selling when it gets to that level, short at that level is very risky. Shorting should be done when DE is above $115, the top it hasn´t been able to maintain twice.
    Jun 14, 2012. 04:55 PM | Likes Like |Link to Comment
  • Caterpillar: Share Valuation By 4 Methods [View article]
    I´m going to include many more indicators in my next analysis, which is DE, don´t get dizzy but they are, so far:

    Current Price
    Share Value w/DCF Valuation

    EBITDA (in billions)
    Company Value w/EBITDAx7
    Share Value with EBITDA x 7

    Graham Formula Share Value
    P/E
    Price/Sales
    Price/Sales Ratio
    EV/Sales
    Current EPS
    EPS for next year
    EPS growth
    FCF to Sales
    Earnings Yield
    Price/Book
    ROIC
    CROIC (4 year average)
    ROE (last 4 years avg.)
    ROA (last 4 year avg.)
    Liquidity: Current Ratio
    Liquidity: Acid-Test Ratio

    Capital Structure: Total Debt/Assets

    Capital Structure: Long-Term Debt/Assets

    Working with EVA and others too, can´t wait.
    Jun 14, 2012. 01:46 PM | 1 Like Like |Link to Comment
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459 Comments
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