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An independent investor who seeks capital appreciation in long and short term investments. Not confined to any one investment philosophy. Sairsint had been involved in the investment community since 1986. If investing is entertaining, if you’re having fun, you’re probably not making any money.... More
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  • Do the math it’s not worth the short term implications –Citigroup that is

    When it was undervalued and on the road to recovery I thought that Citigroup was a good investment albeit with some risk at the time I purchased the original shares. Now that they are going to do a reverse stock split and instate a 1 cent dividend, I think it is time to bow out not in.

    From my perspective/fuzzy math example to think that 10 shares at the time I am writing this which will equal one share come May 6th reverse stock split will equate to 40.56 dollars per share. With the current earning that would make a PE of 12.7 to a PE of 127%. Realize the diluted earnings per share do not rise just because the price changed. Also with the 1 cent dividend per quarter gives us a miniscule yield.  I am already up on the stock and despite what future earning may bring in the shorter term it is beneficial to bow out now and find a much better deal in the banking sector- or at least watch this from the sidelines.

    Shares - Sold half of long positions



    Disclosure: I am long C.

    Additional disclosure: I plan to sell in the short/near term.
    Tags: C
    Mar 21 12:20 PM | Link | Comment!
  • 2010 Census and Beyond, Target the opportunities!

    First of all the trouble with most statistical research it is based on past knowledge and future assumptions. Therefore, always base your investment on the best research, knowledge and comfort ability with where you are placing your money. Again, I always look for value with future growth; otherwise, a stock may run its course to soon. Therefore, with this article I tried to seek out some opportunities looking at it from an ethnic perspective. Blame it on a mandatory Social Sciences requirement I took back in school. Have to make it pay off somehow.

     

    The forecast of the 2010 Census is that 50 Million Hispanics will be living in the US.  Nearly one in six US residents will be Hispanic and Los Angeles County is expected to be home to the largest Hispanic population in the US – exceeding that of Costa Rica. Experts anticipate that the US will be more diverse than ever, with only 22% of households expected to be the iconic American family of mom, dad and kids. The Hispanic population is expected to be much younger compared to other racial groups.

     

    The Selig Center’s estimates and projections of buying power for 1990-2014 show that minorities—African Americans, Asians, Native Americans, and Hispanics—wield formidable economics. The numbers are impressive. In 2009, both the African-American market ($910 billion) and the Hispanic market ($978 billion) are larger than the entire economies (2008 GDP measured in U.S. dollars) of all but fourteen countries in the world—smaller than the GDP of Australia and larger than the GDP of the Netherlands.  The Selig Center projects that the nation’s total buy­ing power will rise from $4.3 trillion in 1990s to $10.7 trillion in 2009, and to $13.1 trillion in 2014. The percentage increase for 1990-2014 is 207 percent. From 1990-2009, total buying power will rise by 151 percent, which far outstrips cumulative inflation.

     

    Minorities make up 35 percent of the U.S. population, another notch toward the day expected midcentury when non-Hispanic whites will become a minority group. More than half of the almost 3 million new people in the country last year are Hispanic, according to the census figures. At 47 million, Hispanics form the nation's largest minority group. In comparison, there are 39.6 million African Americans and 14 million Asians. The nation's 200 million non-Hispanic whites increased by just 360,000 last year, about 12 percent of the total growth. Non-Hispanic whites' median age is 41, compared with 27 for Hispanics.

    The fastest growing race groups will continue to be the Asian and Pacific Islander population with annual growth rates that may exceed 4 percent during the 1990's. By the turn of the century, the Asian and Pacific Islander population would expand to over 12 million; double its current size by 2010, triple by 2020, and increase to more than 5 times its current size, to 41 million by 2050. According to the Census Bureau.

     

    Significant differences can be found across race and ethnicity in the way U.S. employees save and invest in their 401(k) plans, according to 401(k) Plans in Living Color: A Study of 401(k) Savings Disparities Across Racial and Ethnic Groups--The Ariel/Hewitt Study. They analyzed 401(k) information for nearly 3 million employees across 57 large, primarily FORTUNE 500 companies in the U.S. The Hispanics had the second lowest savings rate and second highest outstanding loans behind the African Americans. With whites next followed by Asian with the lowest spending and highest savings rates.

    The results of the study show that African-American and Hispanic workers are less likely than their Asian and white counterparts to participate in their 401(k) plans. Two-thirds (66 percent) of African-American employees and 65 percent of Hispanic employees participate in their company’s defined contribution plans, compared to 77 percent of white workers and 76 percent of Asian workers. Even after adjusting for factors such as age and income, the disparity remains. Why this matters to is the result in a savings and investing behaviors that will lead to African-American and Hispanic workers in danger of retiring into poverty.  These individuals will lose in the end during retirement but the market will gain from the increase in purchase power.   

     

    So how are companies changing the way they do business to capture this market?  Drug chains investing in ethnic products find their payoff at the checkout. One manufacturer said Rite Aid, CVS and Walgreens are getting better and better at managing ethnic products and in tailoring their messages effectively to a wider variety of ethnic demographics, Hispanics as well as African-Americans.

     

    According to the Association of Hispanic Advertising Agencies:

     

    ■■ In alcoholic beverages, the Beer category recorded a jump in allocation from 13.5% to 15.8% while also increasing spending about 10% placing it at the top of all 50 categories studied. By 2008,

    Heineken was allocating 30% of its media dollars to Hispanics, Coors 19%, Miller 17% and Anheuser-Busch InBev 11%. In stark contrast, distilled spirits showed a miniscule increase in Hispanic

    allocations to a mere 2.1% and only a 4% increase in Hispanic media spend versus a -9% reduction in non-Hispanic media spend. All distillers but Diageo cut allocations and dollars to Hispanic. In

    2008, Diageo invested 9% of its media dollars to Hispanics while Brown-Forman invested 2.5%, and Pernod Ricard 1.5%. Bacardi, Moet Hennessey and Fortune Brands allocated less than half a

    percentage point of their media budgets to Hispanics.

     

    ■■  In the Entertainment & Media category, Subscription TV/Radio reflected the largest Hispanic allocation jump, from 4.2% to 10.7% allocation and over 200% in Hispanic media spend increases vs.

    only a +18% increase to non-Hispanic media. Direct TV led the increases with $75M in incremental Hispanic media budgets and added 18 points to their Hispanic allocation up to 25% in 2008.

     

     ■■ Packaged Goods, the largest single category on a dollar basis, reflected a +15% increase in Hispanic media investments to $534M vs. a -4% reduction in non-Hispanic media budgets and Hispanic

    media allocations jumped from 4.3 to 5.2%. Among the biggest movers, Nestlé and General Mills led the category adding nearly $30M each in Hispanic media spend to $42M and $57M, respectively,

    and shifting 4 and 6 points to their Hispanic allocation ending at 6% and 11% respectively. Groupe Danone and SC Johnson added $7M and $17M to $9.5M and $37M respectively in Hispanic

    media budgets after shifting 3 and 4 points to their Hispanic media allocation ending at 7% and 9% respectively. Similarly, Colgate-Palmolive added $1M to their Hispanic media dollars ending

    at $18.4M, while raising their Hispanic allocation by 3 points to 18.5% leading all consumer staples competitors in Hispanic allocation. Also, Clorox shifted 1 point of allocation to Hispanic up to 7.7%, J.M. Smucker moved 1.4 points to 5%, Kimberly-Clark shifted 3 points to 8%, Mars added 5 points to 7.5%. The top spender in the category, P&G, increased its Hispanic investment by $9M ending at $183M and shifting an additional allocation point from non-Hispanic to Hispanic ending at 6.6%.

     

     ■■ Personal Care-Cosmetics-Skin Care showed an increase of +31% in Hispanic media dollars vs. +10% to non-Hispanic media and increased allocations from 4.2 to 5%. Guthy-Renker (Proactiv) and Beiersdorf AG (Nivea) led with the highest Hispanic allocation of the category at 11.7% and 10.2%, respectively. Guthy-Renkor increased its Hispanic allocation by nearly 1 point while Nivea doubled to 10.2%. Guthy-Renker directed $13M incremental Hispanic media dollars investing $22M and Nivea added $6M ending at $10M. Among others with the highest Hispanic allocation are Avon at 7.3% and $4M and Loreal at 6.6% and $43M.

     

    ■■ In the restaurant business, it seems that the recession sparked the appetite of fast food and casual dining companies to satisfy more Latino palates. Quick Service Restaurants increased their allocations from 6.6% to 8.3% while Casual Dining Restaurants also showed an increase, from 3.1% to 4.5%. Hispanic media spending also increased +21% and +35%, respectively while non-Hispanic

    media spending decreased -5% and -9%, respectively. Among the biggest gainers, Sonic increased allocations 6.3 points to 11.6%, Subway increased 3.2 points to 6.7%, Wendy’s increased 3 points

    to 9%, McDonald’s increased 2 points to 14% and IHOP 1.7 points to 4.8%.

     

    ■■ Interestingly, in the Electronics category, computer hardware & software companies between 2006 and 2008 decreased their Hispanic media spending -32% and -21% for non-Hispanic media

    resulting in a very low Hispanic allocation of 1.2%. Meanwhile, the  Electronics-Other category mainly composed of electronic retailers edged up its Hispanic allocation modestly from 3.7% to 4.4% led

    by BrandsMart, which increased Hispanic allocations +1.1 points to 8.3%, and RadioShack, which increased its Hispanic allocation by 2.0 points to 12%?

     

    ■■ While Apparel/Shoe Manufacturers (Hanes, Nike) drastically cut their media dollars and allocations to Hispanic marketing from 2.8% in 2006 to 0.5% in 2008, Specialty Apparel retailers

    increased both dollars and Hispanic allocation from 3.4% in 2006 to 5.6 % in 2008. JC Penney showed the biggest jump by far from $39.4M to $53.2M in investment and from 12.4% to 16%

    in Hispanic allocation. In that same period, the following Specialty Apparel retailers also increased Hispanic allocations: Gap (+3.3 points), Kohl’s (+2.8 points), Payless-Collective Brands (+2.8

    points), Macy’s (+1.1 points), Ross (+1.0 points) and TJX (+0.8 points).

     

    ■■ The Auto Insurance category increased allocation to Hispanic by 3.1 points moving from “Follower” to “Leader”. Hispanic media investment increased 106% while non-Hispanic investment only

    increased 10%. The biggest story in the Auto Insurance category is State Farm jumping from $20M to $87M or from a 9% allocation to a 24% allocation to Hispanic. Allstate followed increasing

    its media spend by $8.4M, from $42M to $50M and Hispanic allocation from 14% to 17%. Liberty, Nationwide and Progressive also increased investments and allocations. Additionally, companies

    in the Life Insurance category increased allocations, from 0.8% to 1.5%, led by Prudential increasing 2 points to 3%.

     

    ■■ In the embattled Auto industry, distressed auto manufacturers cut Hispanic media spend by -12% to $455M vs. -22% to non-Hispanic media thus increasing Hispanic allocations from 4.9% to

    5.5%. In contrast to the nation’s auto industry bankruptcies, Toyota, Nissan and Honda increased Hispanic media dollars and even shifted more allocation points to Hispanic. Toyota added $21M

    in investment to $99M and +3 points to its Hispanic allocation ending at 10% in 2008, Nissan added $2M in investment to $57M and shifted +3 allocations points to Hispanic ending at 7% and

    Honda added $12M in investment to $44M in Hispanic media

    budgets and shifted +2 allocation points to Hispanic reaching 5% Hispanic allocation in 2008.

     

    ■■ While toy manufacturers Mattel and Hasbro decreased media dollars  to <$1M and allocations to Hispanic marketing to nearly 0%, retailers like Target increased both dollars from $28.5M to $49.8M

    and Hispanic allocation from 5.2% to 8.4% and Toys R Us from $4.9M to $6.7M or 6% in 2006 to 9% in 2008.

     

    ■■ Despite the worst recession in decades, the Home Improvement category kept its Hispanic allocation steady at 6.3% while the Banks & Mortgage industry maintained its 3.4% allocation, Furniture

    stayed at 3.7%, and Credit Cards at 2.3%.

     

    So where do you look? Listed below are companies that may provide future growth based on the assumptions made. Some are speculative in nature and others may present great opportunities. If you notice, there are many financial companies, which is understandable based on the previous information presented.

     

    Hispanic Media Companies:

    Univision Communications (NYSE: UVN - news - people) 

    Entravision Communications (NYSE: EVC - news - people) 

    Hispanic Broadcasting (NYSE: HSP - news - people) 

    Terra Networks* (NASDAQ: TRLY - news - people) 

    StarMedia Network (NASDAQ: STRM - news - people) 

     

    Other Companies of Interest:

     

    Doral Financial DRL

    Financial services company that operates in Puerto Rico and the New York City area.

    Entravision CommunicationsEVC

    Spanish-language media company with television, radio, outdoor advertising and publishing products targeting U.S. Hispanics.

    First Bancorp FBP

    Financial holding company that operates in Puerto Rico and the Virgin Islands.

    Gruma S A de C VGMK

    Produces and distributes corn flour and tortillas.

    Grupo TelevisaTV

    Mexican television and radio.

    International BancsharesIBOC

    Financial holding company with four bank subsidiaries in south and southeast Texas.

    MetroCorp BancsharesMCBI

    Houston-based bank with a Hispanic customer base.

    Molina HealthcareMOH

    Managed care organization for Medicaid and other programs for low-income people.

    Perry Ellis InternationalPERY

    Sportswear aimed at the Hispanic male.

    Popular BPOP

    Financial services provider located in Puerto Rico, the United States, the Caribbean and Latin America.

    Santander BancorpSBP

    Financial services provider located in Puerto Rico.

    Spanish Broadcasting SystemSBSA

    Hispanic-controlled radio broadcasting company with stations across the United States.

    United PanAm Financial CorpUPFC

    Specialty finance company that deals in high-risk auto loans.

    W HoldingWHI

    Financial holding company that operates in Puerto Rico.

     

    Again, I am not making recommendations merely publishing information of interest during my personal research. Always do your homework!



    Disclosure: Long T & IST International Telecommunications EFT
    Jun 17 12:27 PM | Link | Comment!
  • A Soldier’s perspective Oshkosh Corporation (OSK)

    Being of a military background and the thought that you tend to navigate towards investments you understand, I would like to convey the thought on Oshkosh and please forgive the rambling pattern.

    There are all kinds of businesses that Charlie and I don’t understand, but that doesn’t cause us to stay up at night. It just means we go on to the next one, and that’s what the individual investor should do. –Warern Buffett

    I have seen their most recent vehicle (M-ATV) in country and made me think about the company as a whole. Based on Soldiers review they love the vehicle and its increased survivability. Rides well, goes fast and falls apart easily when struck by an IED. This is not a bad thing as long as the capsules (main Body) surrounding the Soldier stays intact, which these do very well.

    However, with the war going on for close to ten years you would think that most of the pack has already invested heavily in those areas with value or those that could gain value. There is one stock in particular that I think is still undervalued and has room to grow despite a withdraw from Iraq and pending drawback in Afghanistan in the coming months. This particular stock is Oshkosh Corporation (NYSE:OSK).

    Currently as of this writing, the stock is at apx. 34.00 with a PE of 5, yes I said 5. I understand that is not the only way to look at values so let me continue. As of the most recent quarter Profit Margin (ttm): 7.21%, Operating Margin (ttm): 12.56%, Return on Assets (ttm): 13.04%, Return on Equity (ttm): 94.50%. and quarterly revenue growth is increasing. The naysayers would focus on the EPS Growth (TTM vs. Prior TTM) -139.44%  but a EPS Growth (Last 5 Years) +57.84% projected earnings growth is lower in the 50% range. The long-term debt is high but manageable with a Current Ratio 1.3 (NYSE:TTM), which is below the average for that industry. Profit margin was 10.22%.  OSK's ROE is the highest within its Comm. Vehicles, Trucks Subsector.  The company's interest coverage is at its five-year low.

    You will probably do you own more in-depth analysis but overall the company if faring rather well and I do not take myself for any type of analytical investor. I invest in what I know and understand as stated above.

    1 YEAR PRICE CHART                              
    1 Year Chart 



















    5 YEAR PRICE CHART




















    To be fair Jack Hough of Smart Money has a different opinion after the recent triple gains.

    “The company’s net debt following the acquisition was a lofty 70% of its total capital. That was shortly before the industrial world slipped into recession, demand for platforms dropped and dealers were left with excess inventory. Investors feared the worst, sending the stock below $5 in November 2008 and again in March 2009. However, Oshkosh has made up for part of the sales decline of late by selling armor for military trucks, and the company has aggressively reduced its debt -- to about 40% of capital today. The firm’s stock price has recovered all the way to $38 and change. Shares sell for only about five times this year's forecast profit, but next year as the bulk of the company's military orders wind down, profits are expected to fall by more than half. Municipal orders for emergency trucks are weak at the moment. Oshkosh stock could easily continue to outperform, but much depends on a sustained economic recovery and a corresponding rise in sales of work vehicles and platforms.”

    So what is the outlook?  Again, it goes back to thought s of less vehicles and a still slow economy. Despite a recent $410 million order. To date, Oshkosh Corporation has received orders valued at more than $690 million under the five-year FMTV requirements contract. So what does the future hold?

    Some are bearish (Chart).

     

     














    If I knew that, I would be rich but again I tend to think the economy will continue to recover and OSK is not just a military supplier. On the military side again, given its work on the Joint Light Tactical Vehicle program, which is meant to eventually replace the Humvees, and its purchases of over 8,000 new MRAP All Terrain Vehicles for use in Afghanistan.  Predicted the Army would be looking for the cheapest way to upgrade the current Humvees, unless the Pentagon decided to cancel the Joint Light Tactical Vehicle program. But the Marine Corps, which has about 30,000 Humvees, was probably interested in more significant upgrades, given the expected heavy weight of the new JLTV trucks, McAleese said. He said AM General, the privately held Humvee manufacturer, Oshkosh Corp (OSK) and BAE Systems (OTCPK:BAESF) , as well as some smaller companies specializing in servicing of trucks, were likely to compete with Textron (NYSE:TXT) for the Humvee upgrades. (Reporting by Andrea Shalal-Esa; Editing by Richard Chang)

    Therefore, the overall recommendation for me is BUY – for others it depends on your risk level and approach to buy in (on pull back). In terms of risk on days when the market is up, OSK shares tends to outperform the S&P 500 index. However, on days when the market is down, the shares generally decrease by more than the S&P 500 index. In both short-term and long-term periods, OSK has shown high correlation (>=0.4) with the S&P 500 index. Thus, this stock would provide only low levels of diversification to a portfolio similar to the broader market.

    Still War unfortunately is only profitable for the business world not the Soldier. Therefore, I will continue to work the business side online and work the Soldier side in country. So back to work and off for a ride. They are some cool vehicles as long as you do not have to experience getting your world rocked by an IED either in Afghanistan or in the market.

     Business Description

    Oshkosh Corporation Formerly known as Oshkosh Truck Corporation. The Group's principal activity is to design, manufacture and market specialty commercial, fire and emergency and military trucks. The Group operates through four segments. Access Equipment segment manufactures aerial work platforms

    and telehandlers used in construction, industrial, institutional and general maintenance applications to position workers and materials at elevated heights. Defense segment manufactures heavy and medium-payload tactical trucks and supply parts and services for the U.S. military and for other militaries. Commercial segment manufactures, markets and distributes concrete mixers, portable

    concrete batch plants and vehicle and vehicle body components. Fire and Emergency segment manufactures and markets commercial and custom fire vehicles, broadcast vehicles and emergency vehicles. The Group operates in the United States, North America, Europe and other countries. On 06-Dec-2006, the Group acquired JLG Industries Inc.

    Disclosure: LONG
    Tags: OSK
    May 21 4:19 AM | Link | Comment!
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