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Dr. Stocks-PHD Twenty year Wall Street veteran. Hollywoods direct line to Wall Street. Specialize in market timing and predictive modeling. Follow my updates via twitter/tkathlinastocks and at my blog
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  • LyondellBasell Industries Ticker LYB Price Target $160

    Business Summary:

    LyondellBasell Industries N.V. operates as a manufacturer of chemicals and polymers, refiner of crude oil, producer of gasoline blending components, and developer and licensor of technologies for production of polymers.

    Technicals Now:

    The below chart shows an uptrend of 94 weeks between 2013-2014, break out to peak, for a total of 50 points.

    The pattern has since moved into a long triangle consolidation phase, pulling back a perfect 61% FIB of the up move.

    Technical projections:

    Based on FIB projections and a squaring of price and time, I expect this consolidation phase to continue deep into 2016; ending between the weeks of June 24th thru 30th, giving the stock 94 weeks of consolidation, squaring with 94 weeks of upside between 2013-2014.

    The trend is your friend, a popular saying on Wall Street. As the stock moved UP 50 points into the consolidation phase, expect the stock to move 50 points UP out of the consolidation; giving us a price target of $160 PER SHARE.

    Fundamental Case:

    LYB trades at just under 10xs p/e. Forward projections predict a p/e of just over 9xs. In other words, the street is expecting 10% growth or less; which I consider overly pessimistic.

    LyondellBasell's third quarter operating income in the Americas shrunk significantly from last year, declining from $1.07 billion to $740 million. However, the company's Europe, Asia and international operating income spiked from $223 million up to $412 million--ALMOST A DOUBLE.

    During the latest reporting period, short interest levels exploded on chemical stocks like Dow Chemical Co (NYSE:DOW). LYB shares trade at a 50% discount to it's peers with companies like Dupont trade north of 20xs. LYB short days to cover are currently 3.46 days; compared to the S&P of 3.92 days to cover.

    The XLB ETF however saw an inflow of $81 million week over week. while individual names in the XLB are being targeted by shorts as over valued, the sector as a whole is seen favorably.

    LYB is a cash printing machine with an ROE of 50%, substantially higher then the S&P or it's peers. The companies management keeps returning this cash flow to shareholders with buybacks and dividend increases. The last divvy increase was almost 11%.

    Bottom Line:

    With substantial cash generation, cheap valuations compared to peers, an expected mild winter which will be favorable on fuel cost, and a technical pattern set to explode higher, I have no problem collecting a nice divvy for the next 8 months while waiting for the stock to explode $50 points higher.

    Tags: LYB
    Nov 01 5:01 PM | Link | Comment!
  • UNIVERSAL CORPORATION UVV Strong Buy Price Target $80.

    Universal Corporation operates as a leaf tobacco merchant and processor worldwide. The following chart shows 2 consolidation boxes with a 20 point consolidation rally.

    The expectation is the same pattern will hold out of the second consolidation box, for a 20 point rally. My price target is $80.

    Universal Corp pays a health dividend back to shareholders of $2.08 per share.

    Shares Held +45.57%



    Hedge fund filings the 09/30/2015 filing period, UVV share count among these funds totals 1,702,764, an increase of 533,015 from the 06/30/2015 filing period among these same funds, when the total share count was 1,169,749 for a percentage increase of 45.57%.

    S&P revised UVV stock outlook to stable from negative.

    Any concerns about the reduction in the smoking population are outpaced by the population growth in emerging market consumers.

    I rate shares of UVV a STRONG BUY with an expected near term price target of $80.

    Tags: UVV
    Oct 26 7:11 PM | Link | Comment!
  • American Express (AXP) $60 By January 15th 2016

    American Express via a few misteps by management now finds it's shares locked into a potential downtrend. (not confirmed yet with shares still above 200 day average)

    The above chart shows a clear double top and uptrend line break. The projected ending date for this 1st wave of selling is Fib 21 ending week date of Janurary 15th 2016-price target $60; + or - 5 points.

    Activst investors have recently taken up a large stake in shares of AXP, so I am not able to project at this time if this will be enough to stem the bleeding. However, with the loss of Costco business and an indifferent CEO based on his latest comments, unless a big shakeup happens at the top, AXP shareholders may be in for a long protracted downtrend.

    Stay tuned.

    Tags: AXP
    Oct 25 9:27 PM | Link | Comment!
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