Seeking Alpha

Russ Kaplan's  Instablog

Russ Kaplan
Send Message
Mr. Kaplan received his Bachelor and Masters of Arts Degrees from the University of Iowa and his MBA from the University of Nebraska at Lincoln. He also holds a Masters Degree in Sociology from the University of Iowa. Russ Kaplan is an investment adviser representative for Russ Kaplan... More
View Russ Kaplan's Instablogs on:
  • Updates On Apple And Hewlett Packard Stocks

    Apple Inc.

    One stock you probably thought I wouldn't recommend is Apple (AAPL).

    Now, Apple is a good case for the role psychology plays in investments. When Apple broke the $700 level analysts were saying it was the greatest thing since sliced bread. After a 25% correction they now say it is mature company past its prime and should be avoided. Honestly, has the company really changed in such a short time, or another speculative algorithm from the Quantitative Analysts (QUANTS)?

    By all my measures of value Apple is a good buy. For example, its price/earnings ratio is 11%, which is less than the total market, and about one half of Apple's normal price/earnings ratio. Yes, there is constant change in the computer industry, but Apple, with its management skills and huge trove of cash should be able to adapt to this in their usual seamless manner.

    Apple pays a dividend of about 2% so if you are looking solely for income this is not a stock for you.

    Hewlett-Packard Update

    One stock I wish I hadn't recommended is Hewlett-Packard (HPQ). When I was researching the stock two years ago I thought it was a good opportunity. Unfortunately, with considerable changes in top management, this company, unlike Apple, has not been able to keep up with the current constant change in computer technology.

    To top it off, Hewlett-Packard made a recent purchase of the British firm called Autonomy. It's now looking like they overpaid by $9 billion for the company that has current charges of fraud against them hanging over their head.

    This report is based on research from sources considered, but not guaranteed reliable. Mr. Kaplan may have positions in some, or all, of the recommendations

    Disclosure: I am long AAPL.

    Nov 23 5:19 PM | Link | Comment!
  • McDonald's

    One thing economic bad times does is to take down most all companies, including the strongest, and this often provides us with a unique investment opportunity.

    Heartland Advisers newest pick is a company who's probably known by almost everyone living on Planet Earth. It is McDonald's (MCD).

    McDonald's was founded way back in 1940 in Oak Brook, Illinois, which is still the company headquarters. How many burger chains have come and gone since then?

    In speaking of technology companies I have stressed the need to adapt. McDonald's success has been gained because although its hamburgers today are pretty much the same as they were in1940; they have kept pace with the changes in the fast food business, offering a myriad of new products such as fruit smoothies, salads, Chicken McNuggets, to list a few of them.

    Back then in had one restaurant; at last count McDonalds now has 33,517 restaurants, which are located all over the world. Given the European Debt Crisis, some are thinking that it might hurt McDonald's earnings.

    I think that no matter how bad the economy becomes, most everyone can afford to pay the cost of a Big Mac. In fact, the economic situation may very well benefit McDonald's as people scale back on dining out, due to hard times. Seriously, how many people around the world are going to let the European Debt Crisis affect what they have for lunch?

    As far as stocks are concerned, McDonald's is the bluest of the blue chips. In addition to being a restaurant, McDonald's actually owns much of the property its restaurants sit on, which is not the case with other fast food chains.

    Even in the bad world economy in 2011, McDonald's return on equity was 38.2%, which is stratospheric.

    In addition to all of this,at its current selling price of around $86 per share, it has a dividend of about 3-¼ %, which is way better than you can get on any A rated bond. Since1996, which was the earliest publication of Value Line, the dividend has been raised every year, and I see no reason why this won't continue.

    Disclosure: I am long MCD.

    Tags: MCD
    Aug 03 11:40 AM | Link | Comment!
  • Altera Corporation
    Seeking Alpha Article – Altera Corporation
    January 2012
     
     
    Isn’t it nice to be able to connect to the Internet without having to plug in any devices? Now you can take your laptops, iPads and Kindles anywhere you go, thanks to wireless technology. It is such a comfort to know that your odds of getting lost decrease significantly, because you are now able to find practically any address to anywhere you need to go; thanks to the GPS system for your car. Of course the advanced technological systems used by the US Military have helped to create more efficient homeland security to keep our country safe. All of these high tech items have really helped changed our world for the better. Chances are Altera Corporation (ALTR), our newest stock pick, has had something to do to develop such advanced technology in the sectors of industry that I previously mentioned.
     
    Altera adds another member of the high tech family to our portfolio. It is a producer of semiconductors, with operations throughout the world. It was also the first company to offer a reprogrammable logic machine, back in 1984. Semiconductors are items used
     
    What is a semiconductor? It’s the main ingredient used in all electronic instruments, which covers a lot of ground. The semiconductor essentially transmits electricity so you can “flip the switch” to turn on anything electric.
     
    This is the kind of high tech company that gives me confidence. The company invests 14% of its profits go into research and development. This gives them a decided advantage in keeping up with an ever changing High Tech industry.
     
    Altera was founded in 1983, when the semiconductor industry was very different than it is now. It combines the programmable logic technology they originally invented in 1983, with software tools, intellectual property; and good customer support, and provide high-value programmable solutions for their customers. In all these years Altera has been able to adapt and be at the forefront of these changes. They are headquartered in San Jose, California, with locations in 19 countries.
     
    In size, the company is larger than its nearest competitor, Xilinx (XLNX). The company has a solid balance sheet and is down considerably from its 2000 high of $67 per share, even though it is now making about triple the amount of what they made in 2000.
     
    Because of their continued investment in research and development, Altera continues to create more innovative solutions for a wide variety of customers. Their products are customized to serve many sectors of businesses such as: medicine, testing and measurement devices, the broadcast industry, along with the industries previously mentioned in the first paragraph.
     
    It’s also hard to beat a return on equity of 33.7% and small amount of long term debt. Altera pays a small dividend (less than 1%) so those of you who depend on income from your portfolio may not want this particular selection. For the long-term investors Altera is an undervalued gem on the Stock Market.
     
    Jan 04 2:40 PM | Link | Comment!
Full index of posts »
Latest Followers

StockTalks

  • Just did a post for McDonald's
    Aug 3, 2012
  • brk
    Jun 27, 2011
More »
Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.