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Non Random Walk
  • Why Jim Cramer's "Dogs Of The Dow" Will Stay Dogs 0 comments
    Dec 3, 2013 1:13 AM | about stocks: CAT, IBM, CSCO, XOM, T

    On Monday night, Jim Cramer, reviewed the "Dogs of the Dow", the five worst performing (from a price point of view) components of the DOW index: IBM, XOM, CAT, CSCO, T.

    I've gathered the relevant growth statistics in this article below and they are indeed a mixed bag - nothing really stands out as good. Jim was negative on all stocks save for Exxon Mobil. All of these stocks feature dividends, but only AT&T's dividend is noteworthy.

    I agree with Jim that XOM doesn't look too bad here, its projected growth pattern is heading upward, but there is still a lot of uncertainty. Looking below, you can see that its growth expectations vary from positive to negative. If it can deliver at the high end of expectations, then you could see some real price appreciation, but the price has already run a bit from $86 to $93 and that makes me nervous, however, there has been a short term sell-off, so the bullish among you should enter now. XOM did clear its previous high of $94, technically, this is a good sign.

    (click to enlarge) Caterpillar has perhaps the ugliest numbers I've assembled here, but this is a situation where the bad news has likely been priced in and the growth picture is projected to improve from its awful base. For more on CAT, see here:

    Why you might want to take another look at CAT

    Cramer noted that IBM has good EPS growth, but no revenue growth, this coming from its stock buy backs, among other reasons. There is nothing in the future that indicates an improvement in the revenue picture.

    StockPEPrice/SalesDiv Yield (Trailing Annual)Volatility
    T25.781.45.1%0.15
    CAT16.130.92.6%0.18
    XOM12.2112.6%0.12
    CSCO11.562.32.4%0.31
    IBM12.441.92.1%0.22
    StockEPS Qtr. On Qtr. GrowthRev Qtr. On Qtr. Growth
    T14.3% 10/2013 7.6% 7/2013 11.7% 4/2013 N/A 1/20132.2% 10/2013 1.6% 7/2013 -1.4% 4/2013 0.2% 1/2013
    CAT-42.9% 10/2013 -42.9% 7/2013 -44.7% 4/2013 -55.2% 1/2013-18.4% 10/2013 -15.8% 7/2013 -17.3% 4/2013 -6.7% 1/2013
    XOM-14.4% 10/2013 -54.5% 8/2013 6% 4/2013 11.3% 2/2013-2.4% 10/2013 -16.4% 8/2013 -12.3% 4/2013 -4.4% 2/2013
    CSCO-5.1% 11/2013 16.8% 8/2013 15% 5/2013 47.5% 2/20131.7% 11/2013 6.2% 8/2013 5.4% 5/2013 4.9% 2/2013
    IBM10.5% 10/2013 -12.9% 7/2013 3.4% 4/2013 11.2% 1/2013-4.2% 10/2013 -3.3% 7/2013 -5.1% 4/2013 -0.6% 1/2013
    StockCurrent Qtr EPS Growth ForecastNext Qtr EPS Growth ForecastCurrent Qtr Rev Growth ForecastNext Qtr Rev Growth Forecast
    TN/A N/A N/A7.5% ( High ) 3% ( Ave. ) -7.5% ( Low )2.9% ( High ) 1.4% ( Ave. ) -1.3% ( Low )4.3% ( High ) 2.5% ( Ave. ) -0.3% ( Low )
    CAT33.5% ( High ) 23.9% ( Ave. ) 18.2% ( Low )12.2% ( High ) -4.6% ( Ave. ) -14.5% ( Low )-12.3% ( High ) -15.4% ( Ave. ) -20.8% ( Low )3.7% ( High ) -1% ( Ave. ) -6.4% ( Low )
    XOM5.4% ( High ) -10.1% ( Ave. ) -20.6% ( Low )4.7% ( High ) -6.1% ( Ave. ) -20.3% ( Low )3.9% ( High ) -5.1% ( Ave. ) -14% ( Low )9.1% ( High ) 0.5% ( Ave. ) -5.8% ( Low )
    CSCO-20.3% ( High ) -22% ( Ave. ) -23.7% ( Low )8.7% ( High ) 4.3% ( Ave. ) -2.2% ( Low )-7.9% ( High ) -8.8% ( Ave. ) -10.1% ( Low )-2.5% ( High ) -7% ( Ave. ) -10.4% ( Low )
    IBM19.4% ( High ) 17.1% ( Ave. ) 12% ( Low )30% ( High ) 21.5% ( Ave. ) 12.2% ( Low )-0.9% ( High ) -3.7% ( Ave. ) -7.8% ( Low )1.2% ( High ) -0.4% ( Ave. ) -3% ( Low )

    I've included the quarter on quarter chart for XOM, as it is Jim's favorite. Jim seems to think it will come in at the top of the range of expectations, and is thus, bullish. The fact that it has run a bit in price already makes me a bit nervous. Perhaps the market was a bit ahead of Jim in this case. Still, if XOM returns to solid growth, I could see Jim being quite right here.

    More charts like this on: QoQ Charts

    Disclosure: I am long CAT.

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