Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

ValuEngine Weekly for Seeking Alpha Readers

|Includes:ACTA, APWR, AUQ, BVN, CROX, EGO, FCX, GLD, GOLD, HL, IAG, NANO, NEM, OLED, PCP, RIO, SLW, SVNTQ, VALE, Verizon Communications (VZ)

 

 

Go to ValuEngine.com

 

October 8, 2010
The ValuEngine Weekly is an Investor Education newsletter focused on the quantitative approach to investing and the tools available from ValuEngine. In today's fast-moving and globalized financial markets, it is easy to get overloaded with information. The winners will adopt an objective, scientific, independent and unemotional approach to investing. If you are not yet a member of ValuEngine's stock analysis service, sign up now for a two-week free trial at www.valuengine.com!
Click to enlarge

 

ATTENTION Investors and Finance Professionals:
If you are reading this you should sign up for ValuEngine's award-winning stock valuation and forecast service at the low price of $19.95/month! 
NO OBLIGATION, Two Week FREE TRIAL!

CLICK HERE!
Click to enlarge

If the tables in this email do not display properly, please CLICK HERE to download the newsletter.

Seeking Alpha Readers should check out our Seeking Alpha VE Investment App HERE.

  Bonus for Readers
--Free Individual Stock Report for Weekly Newsletter Subscribers

 As a bonus to our Free Weekly Newsletter subscribers, we are now offering a FREE DOWNLOAD of one of our $ 25.00 Detailed Valuation Reports.  

  This week's free download is our report on VERIZON COMMUNICATIONS (NYSE:VZ).  Yesterday, Apple announced that it will build a CDMA version of the iPhone for VERIZON COMMUNICATIONS' network-- and there are also rumours that the company will begin diversifying it's popular smart phone so as to better match offerings from competitors like Google.  This may provide a boost for Verizon, or it may negatively impact the company's big advantage in network quality if VERIZON COMMUNICATIONS iPhone users prove to be big data hogs like their current AT&T brethren.

  Our models will take some time to digest this info.  Currently, ValuEngine has issued a HOLD recommendation for VERIZON COMMUNICATIONS. Based on the information we have gathered and our resulting research, we feel that VERIZON COMMUNICATIONS has the probability to ROUGHLY MATCH average market performance for the next year. The company exhibits ATTRACTIVE company size and volatility, but UNATTRACTIVE expected EPS growth.

  Based on available data as of today, we believe that VERIZON COMMUNICATIONS should be trading at $33.92. This makes VZ 2.92% undervalued. Our Fair Value indicates what we believe the stock should be trading at if the stock market were perfectly efficient and everything traded at its true worth. For VERIZON COMMUNICATIONS, we base this on actual earnings per share (NYSEARCA:EPS) for the previous four quarters of $2.22, forecasted EPS for the next four quarters of $2.24, and correlations to the 30-year Treasury bond yield of 3.73%.

  VERIZON COMMUNICATIONS, formed by the merger of Bell Atlantic and GTE, is one of the world's leading providers of
high-growth communications services. VERIZON COMMUNICATIONS companies are the largest providers of wired and wireless communications in the United States. VERIZON COMMUNICATIONS is also the world's largest provider of print and on-line directory information.

Weekly Subscribers can download a FREE Detailed Valuation Report on VERIZON COMMUNICATIONS HERE.

If you have not subscribed and want to be able to receive a FREE $ 25.00 Detailed Valuation Report, you can subscribe to our Free Weekly Newsletter HERE.

ValuEngine Index Overview
Index
Week Open
Thurs. Close
Change
% Change
YTD
DJIA 10828.85 10948.6 119.75 1.11% 4.97%
NASDAQ 2362.25 2383.67 21.42 0.91% 3.89%
RUSSELL 2000 679.28 679.29 0.01 0.00% 8.15%
S&P 500 1144.96 1158.06 13.1 1.14% 3.72%
Click to enlarge
ValuEngine Market Overview
Summary of VE Stock Universe
Stocks Undervalued
62.52%
Stocks Overvalued
37.48%
Stocks Undervalued by 20%
28.33%
Stocks Overvalued by 20%
12.25%
Click to enlarge

 

ValuEngine Sector Overview
Sector Change MTD YTD Valuation Last 12-MReturn P/E Ratio
Energy 0.02% 1.54% 6.94% 3.93% overvalued 26.99% 24.84
Basic Industries -0.57% -0.83% 21.28% 1.42% overvalued 36.88% 24.54
Public Utilities 0.04% 1.08% 0.80% 0.47% overvalued 14.05% 19.88
Transportation -0.30% 1.01% 11.05% 3.89% undervalued 17.51% 19.70
Consumer Non-Durables -0.16% 0.65% 7.84% 3.91% undervalued 19.66% 16.70
Capital Goods -0.04% 1.01% 16.77% 6.98% undervalued 14.66% 21.05
Finance -0.35% 0.78% 13.12% 7.36% undervalued 4.97% 18.02
Consumer Services -0.04% 0.58% 11.00% 7.51% undervalued 13.46% 21.28
Technology 0.01% 0.37% 16.72% 8.70% undervalued 21.85% 24.07
Consumer Durables -0.17% 0.55% 13.47% 9.96% undervalued 26.11% 19.26
Health Care -0.07% 0.76% 20.41% 12.46% undervalued 3.65% 20.09
Click to enlarge

 

Industry Talk--Precious Metals

   All in all, our models have a pessimistic view of the industry, but this means little in times of Glen Beck-induced survivalist/hyper-inflation fear mongering and "Gold Line" mania.  Of course, the market is always right, and with gold on a huge run up, investors need to beware the momentum, the bubble possibilities, etc.

  Below, we present various top-five lists for the Precious Metals Industry from our Institutional software package (Pending:VEI).  We filtered our results with liquidity requirements of minimum $2/share price and volume of 100k/day.  There are 44 stocks meeting our criteria--only three of them are rated buys, five are rated sells, and the rest are holds. 

 

Top-Five Precious Metals--Short-Term Forecast Returns

Ticker Name Mkt Price Valuation(%) Last 12-M Retn(%)
NEM NEWMONT MINING 63.03 0.56 36.4
VALE VALE RIO DO-ADR 32.19 1.29 34.01
IAG IAMGOLD CORP 17.41 -4.54 20.48
RTP RIO TINTO-ADR 61.58     N/A 42.18
GLD SPDR GOLD TRUST 130.37     N/A 27.36
Click to enlarge

Top-Five Precious Metals--Long-Term Forecast Returns

Ticker Name Mkt Price Valuation(%) Last 12-M Retn(%)
VALE VALE RIO DO-ADR 32.19 1.29 34.01
GLD SPDR GOLD TRUST 130.37     N/A 27.36
NEM NEWMONT MINING 63.03 0.56 36.4
BVN BUENAVENTUR-ADR 47.68 20.03 28.38
EGO ELDORADO GOLD 18.36 29.3 51.36
Click to enlarge

Top-Five Precious Metals--Composite Score

Ticker Name Mkt Price Valuation(%) Last 12-M Retn(%)
VALE VALE RIO DO-ADR 32.19 1.29 34.01
NEM NEWMONT MINING 63.03 0.56 36.4
GOLD RANDGOLD RSRCS 101 -10.13 40.01
IAG IAMGOLD CORP 17.41 -4.54 20.48
BVN BUENAVENTUR-ADR 47.68 20.03 28.38
Click to enlarge

Top-Five Precious Metals--Most Overvalued

Ticker Name Mkt Price Valuation(%) Last 12-M Retn(%)
NXG NORTHGATE MNRLS 2.95 38.06 5.36
TIE TITANIUM METALS 19.85 37.35 102.55
EGO ELDORADO GOLD 18.36 29.3 51.36
AZK AURIZON MINES 6.73 27.55 31.45
SLW SILVER WHEATON 26.04 24.36 88.7
Click to enlarge

  VE Premium Website Stock Analysis subscribers can find complete valuation, forecast, and ratings data on every individual equity in our universe of more than 5,700 equities HERE.

Seeking Alpha Readers should check out our Seeking Alpha VE Investment App HERE.

What's Hot
--The ValuEngine Forecast 22 MNS Newsletter Portfolio

  Our portfolio continues to provide good results.  Currently, our long side is up more than 6% since September 17th.  Sixteen of the 22 positions are positive-- and 12 of 22 are up 5% or more.  Below, we provide performance data for the top-performing longs so far this month.   As you can see, our Forecast Model is adept at picking in winners in a variety of sectors.  Of particular note here is Freeport McMoRan (NYSE:FCX).  FCX is up almost 50% since inclusion in the portfolio on July 15th.

Ticker Company Name Entry Price 9-17-10 Current Price Change %Change Sector
CROX CROCS INC 11.03 14.38 3.35 30.37 CONSUMER NON_DURABLES
APWR A-POWER ENERGY 6.22 7.75 1.53 24.60 PUBLIC UTILITIES
ICGE INTERNET CAP GP 9.86 11.24 1.38 14.00 CONSUMER SERVICES
FCX FREEPT MC COP-B 81.73 91.4 9.67 11.83 BASIC INDUSTRIES
PANL UNIVL DISPLAY 22.62 25.08 2.46 10.88 CAPITAL GOODS
SVNT SAVIENT PHARM 20.27 22.47 2.2 10.85 HEALTH CARE
NANO NANOMETRICS INC 12.88 14.21 1.33 10.33 CAPITAL GOODS
Click to enlarge

For more on the VE Forecast 22 Market Neutral Strategy Newsletter Portfolio, Click the Logo Below

   

 An archive of this weekly newsletter is available here.

Click to enlarge
 
Click to enlarge
 
Close this window
ValuEngine.com - Rational advice, smarter investing.
Click to enlarge
 
 
 


Disclosure: no positions
Stocks: VZ, NEM, VALE, IAG, RIO, GLD, BVN, EGO, GOLD, AUQ, PCP, HL, SLW, CROX, APWR, ACTA, FCX, OLED, SVNTQ, NANO