Pouya

5 Comments

    • Jamba Juice: If You Build It, Will They Come? [view article]
      Jamba Juice is not learning from Starbucks' mistakes. I would say that the stock will continue to nose dive, but it has performed so poorly that it may have actually bottomed in mid-March. I actually don't like the entire Retail-Restaurants industry, so I am reluctant to recommend any. But if you are SET on finding one, the strongest stocks in the industry are RRGB, BKC, CMGB or CMG (solid fundamentals for the Chipotle stores). Apr 11 09:33 AM
    • Is Visa Really Priceless? [view article]
      Anthony,

      There is more to valuations than just looking at the number of shares outstanding. There are many best of breed companies out there that have outperformed despite having more shares than there competitors. I hope you don't exhibit the same shallow analysis when handling your client's money.       Apr 08 04:09 PM
    • Visa IPO Aftermath: Europe’s in Trouble, China’s Buying in Bulk [view article]
      GTH,

      Visa already trades at a premium over MasterCard. Compare their PE ratios.       Mar 30 08:19 PM
    • Visa, Mastercard Risk Ramped Up Competition [view article]
      MoneyGuru,

      Jim Cramer can be an asset if you learn to filter out a lot of what he says. If you track all of Jim Cramer's recommendations, he is statistically wrong more often than he is right; he is correct only ~48.6% of the time. In addition, you should have done your homework before buying Visa if you thought it was going to increase 400% like MasterCard. Visa's IPO was being priced to match current Mastercard’s valuation taking into account its 400% increase. The $44 Visa IPO price was actually at a $5 premium over Mastercard's current valuation. The only reason the Visa stock price is so much lower is because it has more shares outstanding. Thus, the likelihood of Visa increasing 400% is roughly the same as Mastercard trading at ~$800 per share. While this is unlikely, Visa is still a good long term play, because Visa is larger than Mastercard and has a significant advantage on the US debit card market which is responsible for the most domestic growth. In addition, and more importantly, Visa is being more aggressive in both Asia and Latin America than MasterCard. When looking at the price of a stock, don't forget to look at the PEG and the possibility of beating analyst earnings estimates. Finally, Visa's stock price will go up even further as more institutions start investing in it as a non-cyclical stock. Non-cyclical stocks such as PEP, KO, and PG tend to go up before the sign of a recession not because the company performs better , but because the recession doesn't really affect the company (e.g., people still buy toothpaste) and institutions are looking for a safe place to invest.
      Mar 29 09:55 AM
    • Continuing the Jim Cramer Truth Watch [view article]
      When he says Bear Stearns is not in trouble, he's referring to the company's services, not the company stock. He's saying if you made use of Bear Stearns's brokerage services then your assets were not in danger of being frozen or lost (in which he was right, because the Fed bailed them out with the JP Morgan Chase deal). He also said that Bear Stearns stock was worthless, which was correct given the recent plummet. Mar 21 08:30 AM
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