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Instablog – Updates of Dow 30 Industrial Companies From My SeekingAlpha.com Articles and my SafeHaven.com Course of Study: March 12th.

|Includes: Apple Inc. (AAPL), BA, BAC, CSCO, GE, XOM

Instablog – Updates of Dow 30 Industrial Companies From My SeekingAlpha.com Articles and my SafeHaven.com Course of Study:

 

Date:  March 12, 2011

 

Introduction

 

As you likely already know I am providing SeekingAlpha.com a flow of articles with a focus on company valuation.  (Over 30 covering many companies – so far)  The information and data within these articles are backed by my “Three Disciplines” of investing wisely.  They are a weighted fundamental (40%), technical (35%) and consensus (25%) analysis.  They are also based on my “Three Pillars” of my Methodology.  (please see below)

 

In addition I am providing SafeHaven.com a week Course of Study focused on the Dow Jones 30 Industrials.  To view my most recent Course, please click on the below URL:

 

http://www.safehaven.com/article/20252/investing-wisely-dow-30-industrials

 

In the below tables there is an update of these 5 of  ‘valuated’ Dow 30 Industrial companies plus Apple, Inc. with brief comments.

General Market – Current Perspective

The general market is currently over-valued, over-bought and is showing serious signs of deterioration, especially in the area of breadth.  Interest rates are on the rise, and inflation is becoming and will be a serious problem.  This means, with regard to your portfolio - you might consider moving to and holding cash or perhaps if you are a more proactive investor, begin taking bearish positions. I would not recommend taking short positions in these five securities - there are much better (bearish) candidates to consider with equally low or lower risk.  The exception may be BAC.

This means that in time frames like we are currently experiencing, the risk / reward ratio of owning common stock or mutual funds is not what I consider “Investing Wisely.”  If you disagree with this, I suggest that you do not follow my work / analytics.  For me, holding cash is basic for investors and unthinkable for traders.

Companies – Current Perspective

 

Apple, Inc:  for those of you who follow my work/analytics closely – you know that I focus on Comparative Analytics.  AAPL serves that purpose very well – it is my Numero Uno.

 

Symbol

Category

Fundamental

(weighting 40%)

Technical

(weighting 35%)

Consensus

(weighting 25%)

 

(NASDAQ:AAPL)

Bellwether

Excellent

Very Good to Excellent

Excellent

Comments:   Apple remains in a strongly ascending trend and has both momentum and relative strength working for it.  I do believe it is in a topping formation.  This time frame is critical for decision-making.  Hold through a pull back or sell and perhaps re-buy?  The probabilities are very high that a bearish inflection point will occur very soon.

 

 

 

 

Grouping One: of the six groupings of five - Dow 30 Industrial Companies.

 

Symbol and Current Numeric Ranking within the Dow 30 Industrials

Category

Fundamental
(weighting 40%)

Technical
(weighting 35%)

Consensus
(weighting 25%)

 

(NYSE:BAC) Ranked: # 26

Bellwether

Very Poor

Good

Poor

Comments: Currently, at $14.5 the company does not look healthy and is carrying a very low Ranking against its Dow peers. Over the coming couple of years the earnings' growth falls back to zero! Fundamentally, BAC is a mess of a company, and I am quite bearish. It is definitely not even a hold. Technically, it looks like it is topping and a bearish inflection point has been completed. I believe the stock is coming much lower before it can begin a new up-trend. Consensus wise, in plain English - the "Street" does not like BAC.

 

(NASDAQ:CSCO) Ranked: # 30

Bellwether

Poor

Very Poor

Poor

Comments: Currently, at $18 the company in trouble and carrying the lowest Ranking against its Dow peers. This year earning' turned negative. However, it appears that next year as well as the following year projected earnings' will have recovered back to normal. Fundamentally, CSCO is meanwhile in trouble, and we must now wait for a recovery. Technically, never hold a stock that takes a beating like Cisco Systems did in November. And to confirm this point - February was another follow-on - there may well be another before a bottom is reached. Holding is and likely will definitely be costly. Those who insist on being Buy and Hold investors have taken it on the chin for over a decade and in this "unforgiving" marketplace this has become an expensive methodology to follow. Mutual funds still have not learned this lesson, and "you" are paying for it! Consensus wise it is negative.

 

(NYSE:GE) Ranked: # 7

Bellwether

Very Good

Very Good

Good

Comments: Currently, at $20 the company has come a long way on the upside over the past four months and carrying a top Ranking against its Dow peers. However, for me, it is not high enough to take a second look! This year, earnings' turned up quite nicely and next year they look even better. Fundamentally, GE is making a positive move that could be sustained. Technically, on a more near-term basis it is looking tired at the current top. Is there more life in it for the near term? My work says yes, but my conservative asset management says - wait for a pullback it may be coming lower. Consensus wise it is definitely not one of the strongest.

 

(NYSE:BA) Ranked: # 22

Bellwether

Poor

Good

Poor

Comments: Currently, at $71 there is little to complain about, at least for the now. The Aerospace Industry Group is still doing well but many component companies have already been hit hard. Remember, these are "Bellwether" companies that are not supposed to be volatile. When doing my analytics and a company Ranks near the bottom of my list, I usually spend very little time looking deeper? Like CSCO, this year earning' turned negative, but it appears that next year and the following year, earnings' will have recovered to the point of you wanting to watch it carefully. Fundamentally, currently BA is just another component of the Dow 30. However, look out and be watchful, things could turn positive in the coming months. Technically, it looks tired and is likely in for a pullback. Consensus wise it is not doing well.

 

(NYSE:XOM) Ranked: # 4

Bellwether

Good

Very Good

Very Good

Comments: Currently, at $82 the company looks healthy but is one of my least favorites for future price appreciation. At this time, it is Ranked very high however, I am not at all positive about the coming years, please note the following numbers. Earnings Grow appears to be declining steadily for the next few years. Current 2011: 17%; 2012: 11%; 2013: 8% and 2014: 0.8%. You should understand that there are almost always better energy companies than XOM to own and many also pay a dividend. The Energy Sector is and has been a very compelling story but is often subject to high volatility. Exxon Mobil is not historically a great mover, but 20% plus price appreciation since December is (or has been) a nice gift. Remember, "they" give-ith and "they" take-ith and away. Don't be greedy. Fundamentally, the near-term looks quite positive, however, the above numbers signal you do not want to remain too optimistic about the coming years. Technically, this is an excellent example of a chart picture that can turn negative without much notice. This current mini-pullback is eating up profits rather quickly. There is very positive Consensus picture. Your job is to remember is it currently rather strong.

 

Note One:  While I cover my Three Disciplines, Fundamental, Technical and Consensus analysis, my focus for these updates is primarily technical.  It’s the WHEN that is so very critical in this market, and I have given you the WHAT in my SeekingAlpha.com articles and above.   Selectivity is also an essential for investing wisely, but rather easy if you will use the “Three Pillars” of my Methodology.  I continuously monitor the fundamentals and consensus status of these and many more companies, sectors and industry groups.  As a mini example, please see my Public List in StockCharts of about 100 companies listed alphabetically by my two categories of securities - Bellwether and High Profile.  Use this URL:  Click here and scroll through them.

Note Two:  When these three disciplines are Excellent to Very Good they become Candidates for Buying and when they are Poor to Very Poor they become Candidates for Short Sale.  There is always rather large number of companies in both categories, but I wait for clear, bullish or bearish Inflection Points to be sure.  You might want to think of these comments in terms of a slot machine.  When my ‘Three Disciplines’ have 3 bars of Excellent / Very Good – it’s a bullish Jack Pot!  Strangely enough to some investors, when I have 3 lemons of Poor to Very Poor – it’s a bearish Jack Pot!

Note Three:  Within this missive I stop short of providing specific recommendations.  If you are interested in a more specific dialog please let me know.  Just so you know, I will work with you for a time if you currently are seeking or believe you may have in the future - interest in my professions asset management / consulting / mentoring services.

You can find a number of supporting Bellwether and High Profile charts amongst the 100 or so in:

 

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID4095527

 

You can find my specific article for these securities by going to search and my name in SeekingAlpha.com.

 

There is more supporting information about my work / analytics in the following URLs:

 

My Personal / Private Blog  --  Investing Wisely:  (Introductory Information about my Investment Methodology)

 

http://twitter.com/InvestRotation

 

Three articles supporting my “Three Pillars” of my Investment Methodology that you may want to read:  (the title for each is at the end of the below URLs)

 

https://seekingalpha.com/instablog/121308-steven-bauer/119898-my-rotation-model-a-short-explanation

 

https://seekingalpha.com/instablog/121308-steven-bauer/120955-my-shb-cycle-a-short-explanation

 

https://seekingalpha.com/instablog/121308-steven-bauer/104062-inflection-points-a-short-explanation

 

 

If you would like an opinion on securities in your portfolio and you are a serious investor, please feel free to Email me with your request.  I would appreciate your first reading my Bio.in SeekingAlpha.com to be sure we are at least a little bit compatible.  Use this URL for my Bio and other information:

 

https://seekingalpha.com/author/steven-bauer

 

Please understand that I do not read and thus do not reply to anything coming to me from the SeekingAlpha.com – Message Board or Comments on my articles.  I also will not read or respond to what I consider to be negative, brief or demanding language from any perspective or any source.  Please use my Email Address to open a positive dialog.

 

Thanks for your interest in my work / analytics and possible my professional services.

 

Steven Bauer,  Ph.D.

senorstevedrmx@yahoo.com