Visa is an excellent long term investment and there is no real reason to sell.
It's true that it underperformed the S&P in the last three months. But that is no big deal for investors with serious intentions. I have been holding Visa for about an year now. Two months ago I rotated some of my Visa into American Express, which proved an excellent move. But i still keep the bulk of my Visa position and if there is a pull back to 150 I will definitely be buying more.
The payment processing business is an excellent one with fantastic profit margins, high barriers of entry and immense potential for growth (more than 80% of all payments around the world are done cash).
So if you are investing with a 3-5 years time horizon then no reason to sell. Unless you spot some other fantastic opportunity.
I would say that Visa can easily go up above USD 185 by the end of this year.
Mr. Market Should Be Looking At Apple's Cash Flow Rather Than Its Profits [View article]
Well, they were not plain stupid. Apple surprised so many times that it seemed possible they will do outstandingly well again. Practically all analysts were expecting that.
People became pain complacent and unprepared for the moment of truth. It came as a shock. And people got scared. I got a bit scared myself. Almost sold... :-)
Apple Slim Down, Buy When There's Blood In The Streets [View article]
anil92691,
I think you are very wrong there. In the smartphone business there is no strong need for standardisation of the OS and therefore no OS will rule supreme. It will stay a highly contestable market.
The Market Is Advancing: Is It Time To Sell? [View article]
Thanks for the reply, Dave.
Seems we have similar approach to sell-offs of premium companies when they don't meet estimations. The short-termism of many asset managers is our friend.
The Market Is Advancing: Is It Time To Sell? [View article]
I bought NSC at $ 62.15 a few months back and would advice not to sell now at $75. NSC has a nice 2.7% dividend and very good prospects for revenue and profit expansion in 2013 and 2014. Plus the US economy is really lifting up and investor sentiment improving. So on top of higher profit NSC may enjoy also a multiple expansion.
NSC could easily reach $100 by the end of 2014.
Why sell? Unless you have another terrific investment idea - better hold.
All large cap US companies' share price depends on large institutional investors. And in the case of AAPL they were the predominant investor even before Steve Jobs died.
For good or bad the institutional investors are the only ones who have the kind of money that would allow them to own companies like AAPL.
But I don't think AAPL will go down to 400. I am getting moderately bullish on this company at this price level.
Especially after the Samsung's presentation of their new phone this week. It seems Samsung is running out of steam. Which means that AAPL is unlikely to see its revenue and profits decline in the next quarters. And that alone is enough to boost the stock.
One other things is that smart phones are quite different from computers in that it is not vital that all users have the same OS (as was the case with the PCs where Windows won and ruled unchallenged). This is mainly because you don't create content on a smart phone.
SODA does hold quite a lot of patents linked to their machines though these patents do not prevent a market entry. But the competitors are not making much headway so far.
The soda machines require CO2 canisters to be changed on regular intervals. Creating a supply network for those is a significant entry barrier. Many customers prefer to do the refilling via a shop and that means that potential competitors would need a number of distribution contracts with major supermarket chains. That's not easy to get done. Certainly Walmarts and the like won't make distribution contracts with soda machine producers at the drop of a hat.
Apart from that SODA has existed for decades now and does posses some reputation as a leader in this area. As a consumer I would also not like to experiment with a new market entrant which may disappear tomorrow sine this is a machine that depends on consumables. Better to go for SodaStream which existed for decades, is the market leader, possesses the widest distribution network and will most likely be 20 years from now.
Then, of course, SODA has the first mover advantage.
So to my mind it would be exactly true to say that SODA has no competitive advantage.
I recommend Seth Golden's very informative posts on SODA in SA.
The stock looks cheap indeed. We can still hope it goes even further down and buy it even cheaper. This could happen; it's a very volatile stock, with limited flow and and a lot of skepticism in the market on it's long-term prospects.
Very good opportunity and a reasonable risk. I rather consider SodaStream not to be a fad. But who knows...
Though I definitely don't imagine SODA trading at a multiple of 30 of its forward earnings. It's more likely it will stay at around 21-25 p/e of the TTM for a month or two.
20 Signs The U.S. Economy Is Heading For Big Trouble In The Months Ahead [View article]
This consumer confidnce statement stroke me as wrong too. While consumer confidence is not great, it is definitely not "at its lowest point in nearly a year".
Consumer Sentiment Index The Sentiment Index was 73.8 in the January 2013 survey, up from 72.9 in December, but just below last Janu-ary’s reading of 75.0. The two components of the Index moved in opposite directions. The Expectations Index posted a gain to 66.6 in January from 63.8 in December, while the Current Economic Conditions Index declined to 85.0 in January from 87.0 in December.
20 Signs The U.S. Economy Is Heading For Big Trouble In The Months Ahead [View article]
Ray Lopez,
You are quite wrong about what QE does to the US public debt. It doesn't increase it in itself. It just puts more money in the hands of the banks (which then may lend it and boost the economy). Incidentally, QE so far has increased the US' borrowing costs (this is because QE is not so much buying of bonds as it is a lever for boosting confidence; it allows money to stream into riskier assests and away from the safe heaven of the government bonds).
QE may also trigger some inflation which may help inflate the public and private debt in the US. And since the dollar is the world reserve currency QE allows the US to transfer some of its burdens on the rest of the world, which holds dollars.
That said, the US seems to be now in a liquidity trap. Zero interest rates didn't work. The Fed moved onto QE, i.e. flushing the economy with liquidity to avoid a debt-deflation trap. But now QE itself is threatening to pose a systemic risk before it has worked it miracle. So the Fed is signalling that QE will be curbed.
I am afraid the only way out is by: - taxing more those trillions that sit and do nothig; - more public spending on infrastructure and to a lesser extent on education; - cutting unproductive public spending (allowences).
Visa - What Is Going On Here? [View article]
- Fidelity Management
- JP Morgan Investment Management
- Credit Suisse Securities
Visa is an excellent long term investment and there is no real reason to sell.
It's true that it underperformed the S&P in the last three months. But that is no big deal for investors with serious intentions. I have been holding Visa for about an year now. Two months ago I rotated some of my Visa into American Express, which proved an excellent move. But i still keep the bulk of my Visa position and if there is a pull back to 150 I will definitely be buying more.
The payment processing business is an excellent one with fantastic profit margins, high barriers of entry and immense potential for growth (more than 80% of all payments around the world are done cash).
So if you are investing with a 3-5 years time horizon then no reason to sell. Unless you spot some other fantastic opportunity.
I would say that Visa can easily go up above USD 185 by the end of this year.
Apple Slim Down, Buy When There's Blood In The Streets [View article]
Mr. Market Should Be Looking At Apple's Cash Flow Rather Than Its Profits [View article]
People became pain complacent and unprepared for the moment of truth. It came as a shock. And people got scared. I got a bit scared myself. Almost sold... :-)
Apple Slim Down, Buy When There's Blood In The Streets [View article]
I think you are very wrong there. In the smartphone business there is no strong need for standardisation of the OS and therefore no OS will rule supreme. It will stay a highly contestable market.
Apple Slim Down, Buy When There's Blood In The Streets [View article]
The Market Is Advancing: Is It Time To Sell? [View article]
Seems we have similar approach to sell-offs of premium companies when they don't meet estimations. The short-termism of many asset managers is our friend.
The Market Is Advancing: Is It Time To Sell? [View article]
NSC could easily reach $100 by the end of 2014.
Why sell? Unless you have another terrific investment idea - better hold.
Apple: Do You Hear The Crickets? [View article]
All large cap US companies' share price depends on large institutional investors. And in the case of AAPL they were the predominant investor even before Steve Jobs died.
For good or bad the institutional investors are the only ones who have the kind of money that would allow them to own companies like AAPL.
Apple: Do You Hear The Crickets? [View article]
But I don't think AAPL will go down to 400. I am getting moderately bullish on this company at this price level.
Especially after the Samsung's presentation of their new phone this week. It seems Samsung is running out of steam. Which means that AAPL is unlikely to see its revenue and profits decline in the next quarters. And that alone is enough to boost the stock.
One other things is that smart phones are quite different from computers in that it is not vital that all users have the same OS (as was the case with the PCs where Windows won and ruled unchallenged). This is mainly because you don't create content on a smart phone.
SodaStream's Crazy Cheap Valuation [View article]
The soda machines require CO2 canisters to be changed on regular intervals. Creating a supply network for those is a significant entry barrier. Many customers prefer to do the refilling via a shop and that means that potential competitors would need a number of distribution contracts with major supermarket chains. That's not easy to get done. Certainly Walmarts and the like won't make distribution contracts with soda machine producers at the drop of a hat.
Apart from that SODA has existed for decades now and does posses some reputation as a leader in this area. As a consumer I would also not like to experiment with a new market entrant which may disappear tomorrow sine this is a machine that depends on consumables. Better to go for SodaStream which existed for decades, is the market leader, possesses the widest distribution network and will most likely be 20 years from now.
Then, of course, SODA has the first mover advantage.
So to my mind it would be exactly true to say that SODA has no competitive advantage.
I recommend Seth Golden's very informative posts on SODA in SA.
SodaStream's Crazy Cheap Valuation [View article]
Very good opportunity and a reasonable risk. I rather consider SodaStream not to be a fad. But who knows...
Though I definitely don't imagine SODA trading at a multiple of 30 of its forward earnings. It's more likely it will stay at around 21-25 p/e of the TTM for a month or two.
20 Signs The U.S. Economy Is Heading For Big Trouble In The Months Ahead [View article]
Consumer Sentiment Index
The Sentiment Index was 73.8 in the January 2013 survey, up from 72.9 in December, but just below last Janu-ary’s reading of 75.0. The two components of the Index moved in opposite directions. The Expectations Index posted a gain to 66.6 in January from 63.8 in December, while the Current Economic Conditions Index declined to 85.0 in January from 87.0 in December.
http://bit.ly/YICcNi
20 Signs The U.S. Economy Is Heading For Big Trouble In The Months Ahead [View article]
20 Signs The U.S. Economy Is Heading For Big Trouble In The Months Ahead [View article]
You are quite wrong about what QE does to the US public debt. It doesn't increase it in itself. It just puts more money in the hands of the banks (which then may lend it and boost the economy). Incidentally, QE so far has increased the US' borrowing costs (this is because QE is not so much buying of bonds as it is a lever for boosting confidence; it allows money to stream into riskier assests and away from the safe heaven of the government bonds).
QE may also trigger some inflation which may help inflate the public and private debt in the US. And since the dollar is the world reserve currency QE allows the US to transfer some of its burdens on the rest of the world, which holds dollars.
That said, the US seems to be now in a liquidity trap. Zero interest rates didn't work. The Fed moved onto QE, i.e. flushing the economy with liquidity to avoid a debt-deflation trap. But now QE itself is threatening to pose a systemic risk before it has worked it miracle. So the Fed is signalling that QE will be curbed.
I am afraid the only way out is by:
- taxing more those trillions that sit and do nothig;
- more public spending on infrastructure and to a lesser extent on education;
- cutting unproductive public spending (allowences).
AIG: What You Need To Know Before Earnings Are Announced [View article]
Can you share some of your concerns? Some possible writedowns on opaque financial assets in the balancesheet?