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John Schuh's  Instablog

John Schuh
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I've been an investor for at least 11 years and have been following the markets since 1996.
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  • Party Like It Is 1999?

    It's starting to feel like 1999 again in the markets. The markets have risen to insane levels, most of the companies are highly overvalued, and people continue to add money to them. Many investors think they need yield but what good is trying to capture yield if your stock would go down 50%? They will be left holding the bag and could be another 10 years to recover their losses. It seems scary at these levels and you really need to know the depths of the companies you are invested in.

    Questions you would need to ask yourself when you review your stocks: How would they perform in a market going down 20% plus? Would your stock go down greatly if your stock had bad news for it's earnings?

    My message to investors in the market is assume the worst. If you "need" to invest try to invest in companies that would be effected little by such a negative move in the overall market.

    Apr 11 12:44 PM | Link | Comment!
  • Two Companies With Real Value

    Many people worry about how to safely invest what could be the market top. Finding value at these levels seem to be like searching for a needle in a haystack. Some of the top investors are saying that you should be building up your cash to buy on a market decline. Most top investors will rotate their portfolio into stocks that have real value and perhaps they might be looking into these two companies:

    Monster Worldwide, Inc. (NYSE:MWW):

    Monster Worldwide, Inc. not to be confused with Monster Beverage Corp. (NASDAQ:MNST). Monster Worldwide is the parent company of The online company that connects job seekers with employers. It is no question that holding onto this stock for the past few months has been painful. The sentiment has not been optimistic for a growth in jobs and many people are not looking as proved by the last jobs number. This company is worth looking at if you are a person that always searches for the best deals. With this being a profitable company trading 12 times forward earnings, along with the balance sheet, it could be trading much higher. If the company was dissolved, the value says it is worth at least $7.51 per share and is trading around $4.48 per share. Many companies that trade well below its dissolved value could be a takeover target by private equity. The downside seems to be completely worked into this stock, the slightest upbeat news of any kind could allow this to trade much closer to that $7.51, and when everyone says sell is the time the great investors will buy.

    United States Steel Corporation (NYSE:X):

    The short sellers had a pretty good run in this company. In fact, the short interest is roughly about 25% of the float. Many times the traders will either inflate the price to insane levels or make a company cheap. This company seems dirt cheap and not likely to get cheaper at the current valuation. It is trading near its low on April 3rd. Currently it's up about 6% since then while trading about 9 times its forward earnings. If the company was dissolved, the value says it's worth at least $24.11 per share and is trading around $17.83 per share. This stock should be seriously consider for your portfolio.

    Final Thoughts:

    Both of these companies are likely to perform into the future and are trading below the value they are worth by liquidation. Those who are short are in a very dangerous position. So sit back and relax, these will likely outperform no matter how the market performs in the future.

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in X, MWW over the next 72 hours.

    Tags: X, MWW, Long Ideas
    Apr 11 12:44 PM | Link | Comment!
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