Sunday, February 11, 2018

"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