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Yale Bock
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Yale Bock is the President of Y H & C Investments, a Registered Investment Adviser based in Las Vegas, NV. My educational background is a B.A. in Economics from UC-Irvine, a MBA from UC-Irvine, and have earned the right to use the Chartered Financial Analyst designation. I have been managing... More
My company:
Y H & C Investments
My blog:
Y H & C Investments Blog
  • Turnarounds In The Stock Market, Disney's Mobile Strategy, Starbucks In Europe, And Obama's Youth Vote- 0 comments
    Mar 30, 2012 2:24 PM

    The stock market is on a roll with the Nasdaq leading the way, up over 20% in the last three months. Will it continue? Hard to believe it stays on the current path, probably a few setbacks here or there. Still, with bond yields where they are, it will take many years of 2 and 3% interest rates payments to match what you got in the last three months in the equity markets. Yes, there is risk of loss, but you already have big gains in a relatively short time frame.

    Turnarounds are always available in the stock market, as there are always companies whose performance lags and has a very low stock price. Does that mean they will make great investments? Not always, but it is certainly an area to consider when investing. A few classic turnarounds over the last few years would be McDonalds and Starbucks. Ronald McDonald at one point was down to 12 bucks a share, and the big green machine was at 8 bucks a share only three years ago. Both have come roaring back and are stronger than ever. Last year, Sears stock price was down over 80%. In fairness, it is currently up 110% for this year, but I don't think it is a great turnaround story. Competing with Wal-mart, Target, Costco, Hope Depot, and Lowe's, among others, is a really rough market. So what other candidates are out there that look interesting?

    The three that come to mind would be HP, Best Buy, and RIMM (Research In Motion). Full Disclosure: (Yale Bock and Y H & C Investments own HP and Best Buy for clients and for himself). HP and Best Buy are market leaders with businesses that generate large amounts of cash and have pretty strong balance sheets. HP is the current market leader of printer cartridges, and has actually expanded share over the last year. The problem there is in their software, consulting, and hardware offerings. With Best Buy, they have no debt and lots of cash and growth has slowed, along with a few too many big box stores. Both are very fixable, especially Best Buy, which should just shut down the non performing locations. Time will tell as to how these perform but in the meantime, you get paid dividends so time is on your side. RIMM is tough because their products relative to Apple and Google are inferior. A few more tidbits from the business and political world-

    Here is a look at the Disney Mobile Strategy-techcrunch.com/2012/03/30/its-a-disney-party-dena-disney-team-up-to-launch-mobile-games-worldwide/

    There are two kinds of businesses- those that have problems, those that are going to have problems. Yes, even Starbucks- www.nytimes.com/2012/03/31/business/starbucks-tailors-its-experience-to-fit-to-european-tastes.html

    Obama is losing steam among young voters-http://www.bloomberg.com/news/2012-03-30/obama-campus-fervor-losing-to-apathy-as-students-sour-on-2012.html

    If you forgot the Covestor Next Invest conference, here is a link as it is available through April 21, 2012-presentations.inxpo.com/Shows/Covestor/R...

    I hope everyone is enjoying the spring. Stay happy and healthy and enjoy the weekend. If you have any comments,on the blog or any articles, please post them!!!

    As always, on any company mentioned here, past performance is not a guarantee of future returns. Investing involves risk of losses on invested capital. One should research any investment and make sure it is suitable with your objectives, risk tolerance, risk profile liquidity considerations, tax situation, and anything else pertinent to your financial situation. Also, the CFA credential in no way implies investment returns will be superior for any charterholder.

    (If you are interested in seeing the latest Seeking Alpha articles about specific stock picks from Yale Bock and Y H & C Investments, click the following links)

    Article   
    Wynn Resorts: The Show Has Just Begun   
    Unilife Strives To Be A Major Player In Medical Dev...   
    CardioNet: A Market-Beater Or A Value Trap?   
    Marchex: Contender Or Pretender In The Mobile Adver...   
    American Greetings: A Value Trap Or A Good Opportun...   
    USA Technologies: Possibly Building A Payment Proce...   
    2 Value Stocks Under 2 Dollars

    Disclosure: I am long HP, BBY, SBUX.

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