"The market correction has opened up some preliminary value bargains that are worth mentioning. With a long term perspective you can get some wonderful investments".

Dow Jones Industrial Average 25,339.94  (Down) 
Week ending 10/12/2018    S & P 500 - 2767.13

You are probably thinking I have been really lazy and kicking back on doing my blog , but I have been very busy in my business and personal life and just got back from a business trip in Houston, TX. The current and very normal correction has opened up some opportunities to purchase stocks at a bargain.  I will list them in no particular order.

United Rentals Inc. - (URI)  - $137.88   Plenty of earnings here going forward and a real bargain.

Capital One Financial Corp - (COF) - $90.79 Great entry point for long term investment. Still operated by the family founders of the company. 

Celgene -(CELG) - $82.58  Earnings rolling up well here. Need to check if affected by new generic products. Watch the revenue growth numbers with recent slowing.

ZTO Express - (ZTO) $16.25 - this transporter/ deliverer of Alibaba products in China through a woven delivery network. Great forward growth potential.

Whirpool - (WHR) - $103.83 - Buy this one after the earnings call on October 26th. Probably will take a hit on the tariffs, but will give you a great entry point then. This has most everything priced in already and tends to correct earlier then others.

Colfax Corp - $32.29   - This "baby" Danaher industrial fits perfect in your portfolio here and is a great value. 

You should do some extra homework on these just to make sure that you want to invest for a 2 to 3 year period.  URI and ZTO are probably the most timely buys right here of the group.

 "Freewilly has given us plenty to think about. Always keep some cash on hand also for future bargains."

         Fall is finally here in the Northeast USA.  Rain be gone!  Have a great October.

         Freewilly 

" When I watch the stock tape I see many overpriced stocks based on endless growth expectations. Give me a good solid company stock that should be trading much higher based on future earnings forecast. Give me a stock like Whirlpool, symbol WHR".

Dow Jones Industrial Average 25790.35 (UP) Week ending 08-24-2018
S & P 500 Average - 2874.69

There is nothing very exciting about washing machines , dishwashers, refrigerators and microwave ovens. (Unless you are building a new kitchen or house.)

            Whirlpool, (symbol NYSE:  WHR, Price $127.15) is very good at making money selling this consumer goods equipment. 

Whirlpool Corporation is the world's leading major home appliance company, with approximately $21 billion in annual sales, 92,000 employees and 70 manufacturing and technology research centers in 2017. The company markets Whirlpool, KitchenAid, Maytag, Consul, Brastemp, Amana, Bauknecht, Jenn-Air, Indesit and other major brand names in nearly every country throughout the world. 

I believe that the stock of WHR should be trading much higher than its current price based on the earnings going forward. It is running into some short term turbulence here based on the cost rise created by the steel tariffs and because of a shortage of truck drivers. This has caused the stock price to be off by 24.62% YTD year to date. So the whole market capitalization of the company is only about $8.78 billion dollars right now with 69 million shares outstanding. The company bought back shares at a dutch auction in April at around $158.25 per share. I believe they are going to be buying back more shares but I could not find a source to confirm that. Sales have been rising by 3% a year, but in Asia sales rose by 14.5%. 

Here is what I am looking at. The earnings per share for this year are projected at $14.38 per share according to Barron's and CBS MarketWatch.  Next year earnings are projected at $16.63 per share. That is a forward PE of 7.66.  The company is also trading at a Price to Sales ratio of 0.41.  I feel these earnings give you a good margin of safety.

I believe that this stock should trade at between $180.00 to $230.00 per share. I am not sure how all the hotshot analyst are missing this, but they seem to be  blinded by their "Revenue Growth" glasses? WHR has some debt also,  but it seems very manageable.

This company also pays a $4.60 dividend each year, (3.62% dividend), which seems to be very safe.  

I say to buy into it in the next 45 days. ( I own it here).  September and October for many years have traded as down months, so you may be able to get it even cheaper is this time frame.

I consider this a 2 year to 3 year investment, so don't get impatient with it.

   I told my friend to sign up for her 401k at work and she said "there's no way I can run that far."

       (I saw the above on a twitter comment on Tobias Carlisle's - Greenbackd - Value investing website) .

Let's make some money on Whirlpool!  

Freewilly

"The summer moves on and growth stocks continue to gain momentum. I will still stick with my value picks though and reduce my downside risk. I like COF, T, and CCK here.

Dow Jones Industrial Average 25,463.55  (UP) Week ending 08-03-2018

I am still simmering about that CEO the other week that sold almost a Billion shares of his personal company shares of stock at an average of $210 dollars per share and then a week later announced bad news on his earnings call. It was all "legal" of course somehow because the shares had been pre-registered to sell ahead of time, but it was certainly shady. This CEO saved $38 Billion dollars when the stock dropped from the $210 range down to $174 on the earnings call and forward guidance.  Oh and >>>  It was the largest loss of market capitalization of a company in one day in the history of the stock market. 

It tells me that the CEO of this growth company does not have the best interest of his stockholders on his mind and is only out for himself. This also points out the hazard of owning growth stocks, where 4 times a year at the earnings call, you may hit a land mine and have your portfolio hit with a large sudden loss. (In my case it was a large long term paper gain that got erased.) 

All I will say is buyer beware and refer to Phillip Fisher's Point # 15  in his book "Common Stocks and Uncommon profits" : Point 15 -- "Does the company have a management of unquestionable integrity?"  I think we now have our answer to that. We learn greatly in life and investing from our mistakes.

Well, now on to more pleasant thoughts of low risk value stocks. 

AT&T  (Symbol T, $32.37) Insiders have just purchase $8 million dollars in shares. Time Warner coming into the fold makes this a cash generating powerhouse media and telecom company. 

  Capital One Financial Corp.  (Symbol COF, $96.68)  This family run financial powerhouse just won the Walmart credit card business from it's competitor. I like that as a catalyst for the stock to trade up from here. 

Crown Holdings Inc. (Symbol CCK, $45.40)
Earnings are gushing at this designer of packaging which sports a 66.80 Return of Equity. I always knew there had to be money in those bottle caps. Insiders at this one also love the stock. 

Back to the normal font.  I would buy all of the above companies right here in increments of  1/2 or two purchases in case the market takes an overall dip. 

I wish we got to see the stock certificates of the companies we own like in the old days instead of in street accounts. We never get to see the great lithography. I am a paper guy.

Hope you have a great week and that business is good for you.

Sincere regards,

Freewilly

Here is the quandary. How do we take advantage of the 2nd half growth spurt in earnings of 2018 without getting caught up in the 2019 stock market hangover. It is important question of timing.

Dow Jones Industrial Average 25,019.41 (UP) Week ending 07-13-2018
S + P 500 Stocks average - 2801.31
NASDAQ 7825.98

"Investors feeling a bit confined"

What is an investor to do?  There are some tempting gains sitting right out there in front of you. The earnings and buybacks will all be drawing you to buy in. The quants are just blindly pouring into mega growth stock names and riding a wave. Align Technology Inc. is at $363.45 a share. Stamps.com is at $217.10 per share. Lending Tree is at $232.95. It puts me in mind of the market phase when the optical electronics stocks were just heading to the moon. They shortly, (but not immediately), found their way to the ground instead.

But alas, I am a Value Investor. They tell me that I can't purchase bonds, because interest rates are going up and bonds will go down, so no margin of safety there. Do I just move to money market and wait outside the market until the rise and the swoon both are all done? 2020? Do I have the patience for that?  Or do I want do buy some somewhat reasonable , (less than full margin of safety),  Value stocks and ride them out through the storm next year as a long term investor?  Yes it is a quandary.

Well I can give you a couple of "now or later" or "keep an eye on"  Value Picks I like with good Returns on Equity for now.

Progressive Corp.  (Symbol PGR , price $58.44 , Return on Equity 20.20%).  Warren Buffett has GEICO to anchor his portfolio and kick into cash flow, you should have Progressive for your insurance company anchor.

 CBS Class B.  (Symbol CBS , price $59.01, Return on Equity 46.80%) Someday the Redstone's and National Amusement and Viacom and CBS will sort out this tangled mess to realize the value here. 

Mario Gabelli has been waiting on it for years now. (Did I mention patience before?) . I have ridden this trade in the distant past and it worked out very well. Buying Westinghouse shares at 13 and then later selling it in converted CBS Shares at $68.00 per share. ( My daughter bought a new Volkswagen Jetta on her own with this trade!)

This is not a value pick, but it is a name that has popped up as a long term investment idea. Again, not a call on the timing of the price of the stock right here (i.e. Speculative pick) , just bring it up as a "thought out loud". (Also FYI, Tom Gardner from Motley Fool had brought the name up on Consuelo Mack's Wealth Track Show this past week.) 

                                      Stitch Fix . (Symbol SFIX, price $32.96 each)

That's all for today. Happy Bastille Day. The French are in the FIFA World Championship tomorrow against a good Croatia team.  Good luck to both squads. 

 Le Tour De France heads to the brutal cobble stones in Stage 9 tomorrow, then 3 days in Stages in the Alps, (sounds brutal like traveling through our US stock markets with the tariff challenges).

Au revoir!    Freewilly

"Well I finally moved some money in my 401K into the Short term Treasury Bond Fund. I am OK with the FED interest rate raises to date, but I don't think we need another 1/2 percent raise by the end of the year." Still Buying ZTO Express and Mondelez International here.

The FED has done enough!   These minimum wage earners get a little raise on their pay and the FED wants to take it away with higher interest on their credit cards.  Just STOP already.  There is no inflation anywhere! The Russians and OPEC are going to pump more oil so those oil prices will come down naturally. GDP of 4% is not overheating for the USA.  It is and should be just NORMAL growth for this economy. Just leave the rates alone. The European Union is holding firm on their low rates. Don't increase our trade deficits with the dollar being too strong. ENOUGH already. 

( The only inflation I can find is on the price of Mayonnaise. I can live with that and just use Mustard instead to bring the price down).

There are two value stocks I like here even though one is near it highs for the year.

ZTO Express (Cayman) Inc. ADR (Symbol ZTO , $21.15)  

ZTO Express (Cayman) Inc. engages in the provision of express delivery and value-added logistics services through a nationwide network partner. The company was founded by Mei Song Lai in April 2015 and is headquartered in Shanghai, China. ( information from CBS Marketwatch) ZTO had $1.93 Billion in sales last year.  

Officially established in 2013, ZTO Express operates through about 7,700 network partners, according to the firm's prospectus. The company gets about three-fourths of its business from Alibaba and has 26,000 direct employees in China and more than 200,000 across its entire network. (CNBC reporting).

 Mondelez International (Symbol MDLZ, $40.82) can be purchased here with a good margin of safety. Oreo's, Triscuits's, and many other great snack products here. Earnings are growing at almost 9% a year and it has a forward PE of 16. Earnings Q/Q were up 53.3%. Also a 2.1% dividend payment to add to your total return.  

Have a great Sunday watching the FIFA 2018 Soccer games. Mexico upset Germany today. Great excitement here.

Invest wisely and carefully with these interest rates going up in the USA. 

Freewilly

Going shopping for Value in the very sleepy Healthcare area. Mallinckrodt Plc. - symbol MNK is priced to buy, with a good margin of safety.

 









The healthcare area seems to be ripe with value for investment right now after a kind of dormant period. I would invest in Mallinckrodt Plc. (symbol MNK) at $16.50 per share and Forward PE of 2.3 and a possible book value of as high $75.00 per share. 

The venom is still out there on Achtar, the $$ expensive drug after the 60 Minutes TV show, but that will be corrected and they will move forward.

On this Memorial Day we salute the veterans of all wars. Let us hope that some day all wars and violence against our fellow man will end.

Freewilly

The death of the Barron's newspaper version coming with the news two weeks ago that they stopped putting the earnings in the stock listings in the paper. What's the point? Alan Abelson must be rolling over in his grave. Also I have a value stock pick for you, GOOGL

Dow Jones Industrial Average 24462.94   (UP) for the Week ending 04/20/2018 
S & P 500 Index 2670.14  

Hello. Two weeks ago I received my Barron's magazine paper version on a Saturday 
morning  and suddenly discovered that there are no longer listed "Last years earnings"
, "This years earnings" and "next years earnings".  (The last copy to have it was the 
April 9th copy).  This  action renders this once handy tool as kind of useless now. 
(Tits on a bull came to mind).  I am calculatingly that it is the beginning of the end 
of one of the decent newspaper magazines you could read and use as an investor. Oh,
 well I guess the individual stock picker will just need to figure it out. Can't we just
 have a Saturday afternoon without turning on a computer or cell phone? 

The magazine still does have some good articles though. This week they pointed out 
General Mills (Symbol GIS, $43.41 ), was a bargain right 
now, down 27% for the year and a new 52 week low , and is paying a 4.52% dividend
right now. The company has moved into some new areas with the purchase of 
Blue Buffalo Pet foods  and is actually looking to have a pretty good year.  The 
consumer Staples stocks  in general got beat up this week.    J M Smucker 
Co. (Symbol SJM, $114.92) and a PE of 6.43 and a good dividend 
also looks like a good value play here and SJM has less debt than GIS.

After some weeks of studying though, the real value stock  that I want to discuss with
 you is the stock of Alphabet (Symbol GOOGL, $1077.31). 
 I had picked up some shares when it was at $1040.00 this week , which seems to be a 
good buy in point for the stock.  Google reports earnings this week and could get roughed
up a bit according to the CNBC option guys and this could create an opportunity to pick 
up  5 or 10 shares or more.

Warren Buffett for years liked the dynamics of the newspaper business and their
 steady cash flow that they got from advertising revenues.  Buffett in the past has owned
 The Washington Post and the Media General Newspapers and liked many newspapers
 that were dominant in smaller markets.  Now Google gets all those advertising revenues
 and also works with and teaches their customers the most effective way to advertise. 

Then you add to that revenue the Alphabet Cloud Businesses, The AI artificial
intelligence business, The Linux operating system Google interface for all the 
cell phones accept Apple,  $100 Billion dollars in cash, All the mobile patents 
they got when they purchase the Motorola cell phone business, YouTube, 
Waymo automated driverless car business, etc, etc. etc., and you have a 
virtual fireworks of value to be thrown off into stock gains. You just need to buy
the shares.

 "The best value stock I could find GOOGL"

I will also leave you with a good book for value investors to read by Guy Spier. He is 
good freinds with value investor Mohnish Pabrai and tells many good ideas for the
discipline of being a value investor. (Also about many bad behaviors to avoid. Oddly
he says that I should not talk about the stocks I own, but this would be counter-productive 
to writing a Value Stock investing blog so I will need to bend that one rule. I think he will
let me slide on this one.  I bought this book at Barnes and Noble bookstores. I still support
brick and mortar.  Call me old fashion. I like to read Barron's in the paper version best also.

Many happy financial returns, 

Freewilly

"A Tale of Two Cities. While Philadelphia PA was basking in the glow of a 2018 NFL Superbowl Victory, New York City and Wall Street were on a wild ride downward. A week where the Dow Jones had swung wildly and ended down 10%."

Dow Jones Industrial Average 24,190.90  (Down, Way Down!) By most accounts a 10% correction.
S & P 500 2619.55 

"It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way—in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only". Charles Dickens "A Tale of Two Cities"

While Philadelphia PA. was winning their first NFL Superbowl and riding high for the week, with the Championship Parade down Broad Street to the Philadelphia Museum of Art ,(where the Rocky statue stands), on Thursday, it was a glorious week. The first NFL world championship in football for Philadelphia since 1960. Happiness and tears abounded. The team simply had fun.

 (Picture photo credit N.Y. Daily News)

But, up in New York City and Wall Street it was entirely different story. The VIX exploded up and down and traveled over 22,000 points in one week as leveraged VIX derivative funds created havoc in the markets with 50 times amplified volatility. On January 26th, 2018 the Dow Jones Industrial Average stood at 26,616.71 and there were whispers of Dow 30,000. On Friday, 02-09-2018 the Dow closed at 24,190.9, 2,427 points lower in a heart-pounding roller coaster trading week. It was the best of times and it was the worst of times. There were tears, but not of happiness. 

So what is investor to do for the balance of 2018?  My suggestion is to buy bulletproof stocks. Ones that have proved their merit and are tested over time.

One idea is to buy the stock of Texas Instruments (Symbol TXN, $100.49). TXN for 14 years in a row have increased their dividend. They produced free cash flow in 2016 of $4.1 Billion dollars. 

Earnings for the company were $3.61 per share in the trailing 12 months and will be $4.99 per share this year.  Earnings per share for 2019 are projected at $5.67 per share. A forward PE of 17.72.  4th quarter Quarter over quarter earnings were up 28.4%.

Texas Instruments had sales of $14.95 Billion last year that produced $3.65 Billion dollars in income. It had gross margins of 64.3% and a Return on Equity of 39.30%.

TI presently sports a Current Ratio of 3.90 to 1 with very little debt. More insiders are buying the stock than selling. 

The target price on the stock is $120.58
and TI currently sports a 2.47% Dividend yield. I think this could be a very nice total return on your investment in 2018.

The stock gained 33.45% last year and Performance YTD this year is (-3.78%).

Analysts having them at 6 Strong Buy, 8 Buy, and 17 Hold. I think this "Continuous Compounder" as one analyst called it, is just the ticket to be a steady performer in your portfolio.

Meanwhile in other news in this crazy week, Earthling resident genius Elon Musk sent a Tesla car to MARS! (pictured, no photoshop!)

Oh and this week, we have the always joyful PyeongChang 2018 XXIII Olympic Winter Games.

I think the best of times has a big and hopeful lead over the worst of times! 

"All things are possible. You just solve one problem at a time". ( a quote from that movie, "The Martian". Great and hopeful movie. 

All the best to you and your family and country,

Freewilly

Happy New Year 2018. Here are my Value stock picks for the new year. I will evaluate results this time at 1 year and 2 year intervals because sometimes good things in Value investing take time.

Dow Jones Industrial Average 24,719.22  Year End at 12/31/2017
S & P 500 Average 2673.61

2017 was a great year for both Value and Growth investing. You could have just bought Apple or Microsoft and been up 40-50% but who would have thought to do just that?

This year I decided to go with 12 picks to help you build your assets. These are all Value stock picks specifically this year. I think in the long term these with give you the best results with the least risk to your capital.

"Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.”  Sir John Templeton

So in no particular order, here are my picks for 2018:

1.  Alaska Airlines (Symbol ALK)
2.  J.P Morgan Chase (symbol JPM)
3.  Andeavor (symbol ANDV)
4.   InTEST Corp.  ( Symbol INTT)
5.   Express Scripts (Symbol ESRX)
6.   Gilead Sciences (Symbol GILD)
7.   Mastercard Inc. (Symbol MA)
8.   ManuLife Financial Corp. (Symbol MFC)
9.   Square (Symbol SQ)
10.  Discovery Communications (Symbol DISCA)
11.  Jazz Pharmaceutical (Symbol JAZZ)
12.  Brown Forman Group (Symbol BF.B or BF/B) 

This is a mix of varying ideas developed from concepts on Value Investing with consideration to PEG, ROE and intrinsic value of the company . Some Value investors would say these picks are not ugly enough or distressed enough to make a real killing, but for my readers this is an appropriate list that will also preserve capital. (***email me or comment if you want some ugly names and I will be glad to oblige).

We did have some losses in 2017,    but they were not financial.......

 Tom Petty R.I.P. (Rock in Peace)

Have a healthy, happy and prosperous New Year, 2018,

Freewilly