Monday, September 5, 2011

"You have been whipsawed by this market in the 3rd quarter, let the earnings fundamentals lead you forward"

Dow Jones Industrial Average 11,240 (Down)  Week ending September 2nd.

It is really quite simple. You need to own companies which have a strong demand for their products, regardless of what the stock market is doing. There is tremendous demand for Aircraft products right now.  Kaman Corp. ( Symbol KAMN, $31.59) makes aircraft specialty bearings and aircraft  components. Earnings per share will be going from $1.99 in 2011 to $2.42 in 2012. Where do you see a stock like this? Spend $5.00 on the latest copy of Barron's, and get a nice macro view of the market and earnings. We still need paper to give us a better view. It is easy to see.

The next three stocks have tremendous demand for their products and parts because of the exploding demand for Smart phones by the world. Two of them in particular are suppliers to the monster machine known as Apple.  Qualcomm Inc. (Symbol QCOM, $49.68) ,  CIRRUS LOGIC ( Symbol CRUS, $14.20) , and  Skyworks Solutions Inc. (SWKS, $19.62 ) are three stocks that should experience tremendous growth in the next few years from the growth of the smart phone market.
All three are projecting upside earnings growth that should bring their stock prices up.

Another area of growth with demand is the medical devices area. One name I like there since it has pulled back in price is ZOLL MEDICAL CORP (Symbol ZOLL $41.04) .  Again, tremendous upside earnings growth. We all need a defib after looking at our portfolio losses and this stock should be just the ticket.

 Another company with big time earnings growth is Paccar Inc. (PCAR, $35.67 ) growth theme in transportation parts and trucks. All these transportation vehicles whether it be planes, trucks, or automobiles,  are all old now and will need to be replaced soon creating demand.  

And one last one to mention that has a 6.77% dividend to go along with it is SEADRILL (Symbol SDRL, $31.90).   68% of the world is covered with water , and  Seadrill Limited, an offshore drilling contractor, provides drilling and well services to the oil and gas industries worldwide. The company also offers platform drilling, well intervention, and engineering services. They are experts in harsh environmental oil drilling.   

So that should give you something to work with. Happy Labor Day, do not do too much work today, you are supposed to be off. Have fun.


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