Seeking Alpha

jstratt

jstratt
Send Message
View as an RSS Feed
View jstratt's Comments BY TICKER:
Latest  |  Highest rated
  • Acme Packet Warns, Shares Slide [View article]
    So far it has been quiet with few negative pre announcements.

    That is a good sign and bullish for stocks. Especially when the market has been priced for a slowdown.
    Jan 3 08:51 PM | Likes Like |Link to Comment
  • Is IBM A Buy Right Now? [View article]
    I agree with the authors thesis that IBM may have risen above fair value. As a long term IBM bull I have been shaving my holdings after years of building IBM into my largest position.

    Here are some reasons why

    1) A new CEO is unlikely to be able to match Palmisano who I would count in the Top 1% of CEOs of any era.

    2) After several years of single digit PEs, IBM has expanded its PE to near 15

    3) The industry is signaling slower growth as IBM seemed to have a tougher quarter last quarter and ORCL had a significant miss.

    My strategy

    As IBM surged past $190 I sold 10%. I have since shaved another 10%. I have been investing in ORCL since it had its mini crash and earnings miss.

    IBM is a great company and IBM has sold its smarter planet vision. Then Buffett bought and many others seem to have piled into the trade. I dont mind taking some profits and wait for an opportunity to reenter.

    Both ORCL and IBM will grow revenue and throw off huge cash flows. Both should buy back shares and grow earnings at a significant rate.

    I will shave again above $190 but plan to hold IBM for a long time. A reasonable range in the coming year would be $160 - $215.
    Jan 3 05:00 PM | Likes Like |Link to Comment
  • Coca-Cola: A Conservative Dividend Stock For 2012 [View article]
    The author makes some excellent points. I would add a few thoughts on KO.

    KO is a reasonable buy at $70. Since August I have tripled my long term position in KO at prices below $66. An investor could hopefully average in at a price below $70.

    My calculation in the fall was $76 1 year price / $66 current price = 15% gain plus 3% dividend = 18% expected 1 year gain opportunity.

    Anything can happen but the risk weighted investment opportunity seemed attractive. At $70 a share a projected 10% 1 year gain opportunity is implied.
    Jan 3 09:01 AM | Likes Like |Link to Comment
  • Johnson & Johnson: Take Advantage Of Product Recalls And High Dividends [View article]
    Thanks for an interesting article.

    I have moved back into JNJ over the past 6 months for many of the reasons listed in the article.

    That said one additional reason I have moved back into JNJ is because CEO Weldon has screwed up virtually every product they produce year after year for the past 5 years. As an investor when numerous products in every category are recalled the only conclusion is an institutional lack of control. When the products are orthotic replacements, drugs and ingestable products the risk is much higher. By the way the stock was higher 5 years ago than it is today.

    JNJ is a great company and I have been a long term holder with a minimal position in recent years. In todays market, the risk to reward seems better than many other investments so I have been buying.

    All in all I would feel better if Weldon joined Ken Lewis and Angelo Mozillo on the golf course.
    Dec 29 10:05 PM | 3 Likes Like |Link to Comment
  • Earn More Than 10% Yield Backed By The Ford Motor Company [View article]
    Interesting article! Thank you for the contribution!
    Dec 29 08:41 PM | Likes Like |Link to Comment
  • The Economy And The Coming Collapse Of Bond Prices [View article]
    The author makes several excellent points.

    I would add that the overhang of non US government debt can likely never be repaid and could likely get purchased at a large discount in the future. It will be like the Mortgage debt securities in recent years.

    On the other side stocks would get crushed if a reasonable long term risk free rate of 7% came back. Hiding places for investors could get scarce at some point in the future.

    If that should happen I would remain an investor as I have always been an investor. The key would be to spread risks evenly across asset classes, maintain liquidity and low personal debt levels.
    Dec 29 08:34 PM | 1 Like Like |Link to Comment
  • Bank Of America: Piercing Its 'Opaque' Balance Sheet - Part II [View article]
    I have moved back into BAC at $5.50 sh.

    While BAC contains significant risk I believe it also has significant opportunity for gains that justify the risk.

    My thesis is that BAC will get a Mortgage settlement in the next 3 months. The result could be the spinoff of Merrill Lynch but BAC will not go bankrupt. At a minimum a very large profitable banking entity will be intact.

    Ken Lewis has done more damage to banking than any other CEO in banking history. I wonder if Angelo Mozillo invites him over for a drink and to work on their tans.
    Dec 29 08:03 PM | 1 Like Like |Link to Comment
  • The Boston Globe sits down to interview BofA's (BAC) Brian Moynihan, then blasts him by saying he hasn't met the bank's goals and his two-year tenure as CEO has been marked by slow progress. On Friday, Moynihan issued a letter to employees saying the lender has prepared for "whatever turbulent times may lie ahead."  [View news story]
    Moynahan inherited a BAC encumbered with a tremendous pile of Countrywide crap.

    That said his cluelessness over fees and his proclamation that BAC deserved the profits indicated that he is not a long term CEO. He is the best leader to negotiate legal resolutions. After the legal phase is over they need a CEO who doesnt piss off all the customers.
    Dec 25 09:47 PM | 4 Likes Like |Link to Comment
  • 4 Reasons To Be Optimistic About The Stock Market In The Coming Years [View article]
    Excellent Article!

    As a newer investor just out of college in 1980-82 things looked bleak. Autos, Steel and Mfg were closing plants big time and unemployment was 15%. The prevailing opinion was the US was in severe decline and the best days were in the rear view mirror.

    It can get to the point where an investor who dares to look up gets attacked by hundreds of others who can only look down. Each piece of positive news can be overwhelmed by 100 pieces of negative news.

    In the long term the markets have always moved from the lower left of a graph to the upper right.

    Lets suggest for the moment that politicians are partially competent and might take a few steps.

    1) In the US lets suggest that in an election year the large mortgage lenders get an incentive to settle the Mortgage fiasco with proceeds going to write down Mortgages.
    a) Repossessed housing gets sold off
    b) Homeowners get compensated
    c) Housing market turns around

    2) Instead of Europe, Japan and the US competing to be the most over indebted countries an agreement takes place to buy each others debt and stabilize the old G7 economies.

    World growth roars back and stocks rise dramatically.

    The cold hard truth is that economic activity doesnt just happen. For 200 years the world has politically removed barriers to trade and enhanced economic activity. The issues faced in the past were in many ways more difficult than those today.

    One thing is for sure, those who bailed from investing have tended to lose in every era over the past 200 years as well as those who over invest.
    Dec 21 08:24 PM | 2 Likes Like |Link to Comment
  • Europe's Banking Crash Already Happened [View article]
    Italy isnt going anywhere and will stay in the EU The sour grapes exporter is similar to the Germans who suggested Greece sell its islands to pay their debt.

    As an investor I am tired of hearing about Europe. Stock valuations are factoring in EU concerns at current levels. Dont believe all the nonsense being spewed about.
    Dec 20 06:08 PM | Likes Like |Link to Comment
  • Warren Buffett's Investment In Bank Of America Is Doing Just Fine [View article]
    Buffett was given an incredible deal and has lost nothing.

    It will be at least 8 years before BRK exercises BAC shares at probably 5 times the purchase price or more.
    Dec 20 05:40 PM | 2 Likes Like |Link to Comment
  • $4B? No problem. AT&T (T) has just three days to pay Deutsche Telecom (DTEGY.PK) the $3B cash and $1B in spectrum assets to compensate for the failed T-Mobile purchase, according to an SEC filing. But AT&T already recorded a $4B pretax accounting charge, and it can make back the $3B cash in roughly nine days worth of revenue.  [View news story]
    I think this is a signal regarding T leadership. T has made smart moves over the past decade. This is the first stumble and one of the first major decisions by the CEO. It was a very poor judgement.

    Previously the mergers were excellent and the deal to wrap up Apples iPhone held T up. Obama and his team were never likely to allow this merger to go through. Just pissing away 4 Billion.
    Dec 20 05:33 PM | 1 Like Like |Link to Comment
  • A Fundamental Look At Dividend Giant AT&T [View article]
    I appreciate the authors perspective. However I would like to add a few observations as a long term holder of T.

    - I enjoy the dividend but also get concerns when I see a dividend payout of 87% (before the increase)

    - The price customers pay for a minute of phone use is dropping around the world

    - T has been transitioning over the past decade away from land line while maintaining a rough status quo on sales and profits.

    - It is getting harder to make the case that huge increases in usage and data will begin to drive a higher growth rate.

    - I originally thought that by 2012 the massive investment in its business would start to decline leaving additional profits. Maybe 2015?

    I still believe in T but wanted to attack slightly the status quo opinion that it is a very safe stock with a safe 6% dividend that will rise for 30 consecutive years.

    In the quest for return I will likely shave off some T shares to find more Total Return in 2012. T needs to be purchased at a price that adds at least 5% share appreciation to add to the 6%+ dividend yield.
    Dec 17 11:43 AM | 3 Likes Like |Link to Comment
  • Roll over Vince Lombardi: The famously tech-averse NFL may finally move to some high-tech tools after relying on Polaroids and old-fashioned phones for decades - driven in part by the expiration of large advertising contracts with the likes of Motorola (MMI), Gatorade (PEP), and IBM. The WSJ's Matthew Futterman reports (video) that the new look for the NFL could include coaches on the sidelines armed with tablets, on-demand video for fans to watch point-of-view action of favorite players, and embedded chips in equipment to track every player movement for stat-crazy fans.  [View news story]
    The technology sounds exciting and would be a welcome addition.
    Dec 17 11:01 AM | Likes Like |Link to Comment
  • All I Want For Christmas Is A 5% Yield [View article]
    All I want is a 3% real return over a long period.

    Buying a more risky 6% financial yield with 3% inflation and rates likely to rise over the longer term doesnt seem such a good deal to me. I concur with Mr Bavaria's comment above.

    Over my 35 year investing career I have seen the prime rate go from 18% to 3% roughly. Interest rates may stay low a while but I dont want to make a bet on further drops over a longer term.

    Finally I prefer to bet on things that I have high confidence in. I dont have high confidence in either the inflation or deflation arguments at present. What if the 5% Christmas present came with 10% inflation 2 years down the road? What would your investment be worth?
    Dec 15 10:18 PM | Likes Like |Link to Comment
COMMENTS STATS
2,281 Comments
2,877 Likes