Saturday, March 2, 2013

"As the March winds and turbulence in the markets approaches you will want a stock that is anchored with earnings and that already survived a storm. Chubb Corp. (Symbol CB)."

Dow Jones Industrial Average 14,001 (Up) Week ending 02-22-2013

It seems that my time on the weekends has been sequestered away by other chores and events, so I am going to post on my blog very late this week. So with the markets twirling and swirling around I thought I would bring you a stock that was already done dealing with a hurricane.

Chubb Corp. (Symbol CB, $84.03) is an insurance company with rock solid earnings (now that the storm is over).

This one does not quite meet my minimum criteria with a Return on Equity of only 9.88%. It does though have an acceptable PEG ratio of 1.34. They did have dreadful Q4 earnings because of Hurricane Sandy which should not repeat.
2013 earnings are projecting out at $6.61 per share and 2014 earnings are looking like $6.92 per share.

Chubb (CB) is raising their dividend up to .46 cents to stockholders of record March 15 an payable April 2nd which will bring up the dividend yield to 2.17%.

This company will pump out 933 $Million in free cash flow this year on revenue of 13.5 Billion dollars and that can be put to work.The long term EPS growth is projected at 17.56% per year.

The 1 year Total Return on the stock is 22.80% and the 3 year Total Return of 66.29%, so this would be a nice addition to a growth and income portfolio. 

The 52 week high on this stock is $85.00 , so you might want to put this one on your watch list and buy in on a market correction day. It does not seem the be a high beta (trading) stock , so you can easily pick your place to buy in.

I would be remiss, not to mention the passing of Wall Street week's popular guest, reknown Wall street analyst and writer , Martin Zweig. 

Marty has gone to the ages with my mentor Louis Rukeyser. Marty's macro market analysis work and early detection of market changes in direction is unmatched in the history of Wall Street. 

Marty himself was a disciple of Jesse Livermore and a fan of the Edwin Lefevre book, "Reminiscences of a Stock Operator.", the fictional story about the stock trader extraordinaire, Mr. Livermore. I have both the Zweig book, "Martin Zweig's Winning on Wall Street" ,and the Lefevre masterpiece on my book shelf , sitting right next to my copy of Ben Graham's "Intelligent Investor". 

 Marty Zweig and wife Mollie
Marty you will be missed. I salute you and your life's work.


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