Eric K

Altria Has Been Great, Time to Exit

the folks over at Fortune Magazine couldn't disagree with you more strongly:

---Nobody has ever accused the folks at Altria (MO, Fortune 500) and its Philip Morris USA subsidiary of being dummies. (A few other things, sure, but not that.) So when Altria endorsed legislation that would subject tobacco products to FDA regulation - a bill sponsored in the U.S. Senate by longtime tobacco company foe Ted Kennedy - you knew there had to be a reason.

There is. Indeed, the proposed legislation might as well be dubbed the Altria Earnings Protection Act. For starters, the bill prevents the FDA from ever banning cigarettes. Just as important, the wording makes it extremely unlikely that the FDA will ever approve a new cigarette product, because the new entrant would have to be deemed "appropriate for the protection of the public health." The bill also restores states' ability to restrict tobacco advertising. Yet another part of the measure would require the FDA to crack down on sales of counterfeit cigarettes, which have been a drain on Altria earnings for some time. All of these provisions would be beneficial to Altria, as they would help it "lock in its already dominant market share," says Dan Clifton, a political analyst at Strategas Research Partners. (Altria currently controls about half the U.S. tobacco market.)

The upshot is this: If the bill becomes law - and there's reason to think it will, since President-elect Obama was a co-sponsor - Altria's already safe dividend (current yield: 8.5%) will become even safer. So, too, will its earnings growth, which analysts are pegging at 8% for 2009. Throw in the fact that vice stocks are usually recession stalwarts - they've outperformed the S&P by an average of 12 percentage points during the past six recessions, according to Merrill Lynch - and you've got a defensive stock with generous upside. "Given the current environment, both in terms of interest rates and overall uncertainty for almost every company in the market," Citigroup tobacco analyst Adam Spielman writes of Altria, "we think this is worth seizing." ----

money.cnn.com/2008/12/...

Terex Should Buy Back Its Shares in Place of Fantuzzi

"Management is not responsible for the decimation of its share price this year, but is very responsible for being proactive and operating in the investment environment in which they find themselves, the interests of shareholders being paramount"

I fully agree with this comment. But to suggest they use the money instead to buy back shares is just as irresponsible. In this environment, a company the size of Terex needs to hang on to as much cash as possible. And to use it to buy back shares makes no sense.

Not Running Out to Buy Shares in Pfizer

Hey Derek - I don't think many people are rushing out to buy Pfizer because they think it is a great growth story. But with the yield at around 8% how can you go wrong if you are just looking at it as a dividend play? It's almost a safer play then bonds at this point.

By the way.....are you really thinking of going back to pitch for the Red Sox next season? (Had to throw that out there.....)

JP Morgan Analyst: Johnson & Johnson Not Worth the Sum of Its Parts

Didn't Baron's just come out recently and call J&J extremely UNDERVALUED?! This is why analysts are completely worthless. Someone is way off here.

Even this analyst treats JNJ as a stock that should be traded and not invested in by saying after 2009 things look up.

Valuing GE (It's Cheap)

GE is about to go bankrupt G7enn??? That might just be the most insane comment posted on one of these boards........ever! I think they have problems like everyone else. But they are definitely not going bankrupt.

PowerShares Water ETF Lacks Focus

I'm confused. This article makes one believe that investors in this fund actually thought they were buying a commodity. Anyone that has followed this fund knows that it is a play on infrastructure for water. How about giving small investors a little more credit. This is a long-term buy and hold.