Divine calculations and stock picking

I was watching a rerun of the movie the DaVinci code last week with all its many puzzles and calculations that they go through to get to what appears to be the truth. Well it of course made me think about how many times I had bought stocks because it just felt right at the time when the "stars of the market", kinda of the place where everything sat at that moment frozen in time, just seemed to click into alignment to make a certain purchasing decision.
Well , even though Snagglepuss told me to exit stage left, which I did, going to many cash positions, I still have been having these "feelings" about the compelling value of some of the tech stocks here the last couple of weeks. They have done a great job managing their inventories this time around in recession and could turn some earnings around to the bottom line very quickly. These companies are also are showing respectable revenue growth and have good quick ratios (%'s of assets to liabilities on the balance sheet).
So I followed my imaginary "Rose line" and it took me to AT&T Inc. (symbol T). It has a a 6.3 % dividend and plenty of cash to back it up. Current ratio is 1.6 to 1. That beats a half percent at best on sitting cash.
My second pick was to add a high tech/ higher beta tech stock to the IRA account
to add some horsepower to bring life back from the Oct-2007 to June 2009 downside debacle.
That stock is Marvel Technology (symbol MRVL). It has a lot of interesting technologies going forward. It has a 3:1 current ratio. I was lucky enough to buy it two days in front of earnings and guidance, which were good, at 14.25 and it is now up near 15.75 on the announcements. They reported the same day as Dell , so it generated some "daily tech interest".
With that I will warn you that on review in the past I have lost more money in speculative technology stocks than in any other investment category during the old"dot.com" days. These two are not speculative investments. Also other disclaimers, I do not have a series 7 license
and am not a professional investment advisor. Just a guy following my "Rose line" where it leads me.

Sincerest regards,

Freewilly

Exit - Stage Left - Compliments of Snagglepuss - some stockmarket advice

If you remember SnagglePuss , the Pink Lion from 1959

who appeared on the old "The Quick Draw McGraw show" and "The Yogi Bear show" he had a few famous lines he always used.

"Heavens to Murgatroyd" was among the catch phrases. The one

that the lion would use when he saw trouble brewing was "Exit, Stage Left" and he would make a fast escape from the tiny hunter "Major Minor", and dart off out of the way of trouble.

Well the point of all this is that this market has come a long way without any kind of major

correction. It would behoove you to exit stage right (or left )and take some profits (or tax losses) and move a good portion into cash for this September- October time frame. The market, even in good times ,will have issues in October, and in bad times with revenue growth being questionable and unemployment staying even or getting worse , it is a good time to be very risk adverse.

There will always being another stock value coming along later. You just need to have patience.

Exit , Stage Right......

Freewilly

Little surprises, and an inflection point with viewing quarterly earnings

Yes, Zooey Deschanel is guilty of eating frozen yogurt. Or maybe she has that surprised look on her face because she, like me, had sold her Garmin (GRMN) stock at a 21% gain, had the current quarter earnings come in as predicted down 33% , and revenues down 27% YOY (year over year) and promptly watch the stock go up 6 points on the news!#$%$?????
Why you ask? because the reality of their current business for the quarter now does not seem to matter to wall street. We have hit an inflection point. Business Wire by the way reported this as, and I quote, " Improved results and sequential growth" because Garmin did not perform as bad as the most dire preditions. So we have made a turn in the road where if the underlying company is giving future guidance as good, the current results are simply disregarded.
If you had instead invested in one of the retailers that Zooey may shop at , Philadelphia based retailer Urban Outfitters, (URBN) , according to my watch list you would be up a cool 68% plus this year. They sell hip clothes to people who don't want to look like they just
got their wardrobe at Walmart. (I am certainly no fashion statement). Likewise the 6 month chart of stazy retailer Aeropostele Inc, (ARO), is up 85% with the retailing industry in the doldrums. Go figure?

Have a good weekend. Weather prediction: it will be 96 degrees on Monday.

Freewilly

Beware the "Ides of August" - there are just too many people who are too bullish right now

It really scares me when I hear whole panels of people on the finance shows and they are all so bullish after such a run-up we had in the month of July. There is no way that this thing is going straight up from here. it just doesn't work that way. So patience is the watch word and if you have taken profits here keep them on the sidelines for now.
There are a few technology stocks here that you can keep in mind that have very good balance sheets. Two semi-conductor stocks that have 3:1 Asset to debt ratios. Those are Marvell Technology, (MRVL), and Triquint Semiconductor , Inc. ,(TQNT). I do not own either of these yet but would be interested after the correction.,
My favorite stock in the technology sector and one that I do own is InterDigital , (IDCC) , that is a company I consider to be a baby Qualcomm in the 3G cellular space. They own 3000 patents in the 3G technology and are very well positioned for the transition in cellular phone technology for voice and data. The proliferation of the Apple I-Phones and the RIM Blackberry's sucking up bandwidth with video and Internet web browsing are taxing the current cellular systems and changes will need to be made quickly to keep up with customer demand.

So. for the short term , keep your powder dry and raise some cash for the sidelines.

Best Regards,

freewilly

The Flyers method - mucking and grinding and fighting for gains

Like Dave Schultz and Bobby Clarke of the Philadelphia Flyers sometimes you just need to dump the puck in and then work hard, work hard to make something happen.

I dumped in today and sold some shares of good companies with good balance sheets that had 18-20 % gains , (GRMN) Garmin and (ADM) ArcherDanielsMidland. Sometimes, just like in hockey , you need to take shorter shifts, to get all four lines on the ice and keep everyone fresh. It just seemed like both issues were fully valued here.

I picked up some value stocks to plug in with defensive positions. I am not as bullish here as most of the soothsayers. I do not see a fast recovery at all. (BMY )Bristol Myers Squibb has a 6.2 % dividend yield, so you get paid to wait for a stock gain. They are also in a product partnership with Gilead Sciences , (GILD).

Foster Wheeler AG, (FWLT), a play on rebuilding infrastructure in heavy construction and engineeering. Both stocks are value plays that are lower beta volitility than Garmin and ADM. We'll see if we can get a quick goal here if the puck bounces right! These activities are in an IRA retirement account, so are a little bit more conservative picks.

Thanks,

freewilly

Market Update -7/12 or "Dogs marching up a hill"

I have always loved this picture from the web and needed to work it into a blog post. These dogs are working so very hard to get up the hill and seem to be on a mission. I am not sure where they are going. ?

Well the picture is like the current stock market here in the US (as of 7/10). You can have the best quality stocks in your portfolio and be working very hard to improve your positions , but you really don't know where it is going over the last 6 weeks or the next six. I guess we should have all "sold in May and went away." I say every year that "were not going to get fooled again" to quote The Who, but we are probably more fully invested at this time in stocks versus cash than we should be. Hunker down time.

Some things you can do right now is to re buy positions where you have an unrealized capital losses and then sell your original position in 31 or 32 days. You can lock in tax losses for 2009 and sometimes get a little uplift in the stock price. You can also re balance the diversification of your portfolio by buying and selling like priced stocks in different sectors.

I think what we need here right now is for the 30 year interest rates for mortgages to be cut down to the 4 % to get all this debt in the system refinanced and get the housing market moving again.

We also need stimulus grants to small businesses to get them moving again, because they create 60 to 80 % of the new jobs in the US.

We also need to put back in place the "uptick" rule for shorts in the market so that these super "bear" hedge funds with their pools of money cannot continue to strafe good stocks with earnings and decimate them.

Enjoy your week. .............(If you are an employer, hire somebody and put them to work on a project to create new growth at your company.)

Freewilly

Summer Time - some pharma stocks to look at with a 2 year time horizon

Dendreon Corp., (Symbol DNDN), located in Seattle, Washington, trading around $24.50 is up today in a summer doldrums market. One analyst has moved the target price to $36.00 and on CNBC they off-handedly threw out a $49 target handle projected on the stock. Story here is a big cancer breakthrough in prostate cancer treatment.

Another stock to keep an eye on as we go into the next flu season is Gilead Sciences Inc., (Symbol GILD). Sometimes after a big flu threat year like with the swine flu the following year is even worse. This Forest City, Ca. company is very well positioned for medical solutions in this area. The stock trades at $45.36 today. (7/6) Last quarter earnings were growing at 24 % plus.

Either of these stocks could also be targets for buyout from the "bigger fish" in the pharma area. As always buy in with smaller positions and average in with your purchases.

Happy hunting, P.S. disclaimers. I have 37 years of personal trading experience, (and I have had many bumps and bruises along the way), but no degrees in finance or Series 7 licencing. These are just observations based on my experience.

Thanks,

Freewilly

What about that 1953 Plymouth Cranbrook in my profile?

Some folks have asked about why do I have a picture of a 1953 Plymouth Cranbrook on my profile. Well that was my first car that I ever owned. My neighbor Jim Thoms fixed it up and gave it to me for free because I only had enough money to pay for the car insurance in New Jersey. My car even had a name , the "Arnold" , named of course after Arnold Ziffel that used to be the neighbors family pig on the TV show "Green Acres". (That song from the show is still imprinted in my brain). Anyway I still have the stick shift for that car up in my drawer because someone sawed if off when we were down the jersey shore. The Cranbrook with its 218 cubic inch flat head "6" engine had a 3 speed shifter on the column and I had to drive home using the stub of the shifter only. The Arnold machine was all Silver and then had a Black roof, hood, and trunk like a limousine. I can tell you that the "Arnold" was like honey , attracting the young lass's. Certified babe magnet. We also snuck-in once 4 kids into the Pennsauken Drive-in, in the trunk of the Plymouth ,with plenty of room to spare. I also picked up a copy on eBay of the original sales brochure for the 1953 Plymouth series with the Cranbrook and Cambridge shown. I will post it sometime.

Best regards,

Freewilly

Michael - by the numbers

Since this is a financial and music blog I thought it only appropriate to post Michael's incredible stats. The loss of Michael and Farrah Fawcett, two icons of our youth, makes you sit back and think that you must be ancient!

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Here they are:

750 Million Albums

Michael Jackson is the third biggest selling pop act of all time after The Beatles, and Elvis. His 1982 album "Thriller" is thought to be the biggest selling album EVER , selling over 65 Million copies according to the Guinness book of World records.

Michael Jackson's earnings from record sales, tours, merchandise and other business ventures are estimated to have succeeded $700 Million dollars in his 40 year recording career.

Since the early 1980's his recordings have generated more than $300 Million in royalties.

In 1985 , Jackson paid $47.5 Million for a catalog of 4,000 songs including 200 Beatles songs.

By 2005, the catalog now co-owned by Sony , was worth $500 Million dollars. Paul McCartney is believed to have originally tipped him off to the financial benefits of owning music catalogues.

In 1987, Michael purchased 2800 acres northwest of Santa Barbara CA. for $14.6 Million and named it "Neverland" , after the imaginary land in J M Barrie's novel Peter Pan. By 2006 it cost him $4 Million dollars a year to operate.

Michael won 13 Grammy Awards and many music video awards.

Michael was never found guilty of any of the charges against him.

Best Regards,

Freewilly

Wilson Family Reunion June 28th, 2009 - Sunday

Wilson Family Reunion - June 28th, 2009 Sunday

Cherry Hill, N.J.

Information or directions call Howard Wilson or David Wilson.

On the right side is a picture from the 6/28/2009 party. Weather was sunny and beautiful and we had a fun time of eating, drinking and swapping Wilson and Reader family stories.

Freewilly

Is there a best month of the year to invest in the market?

It seems that the market always is going down through the first 3 weeks of October, which ends on the third Friday which is "triple witching" options expiration's. (Note the Jack-O-Lantern).
The big crash of 1987 was on Oct. 19th if you will note. So right after "triple witching" is probably a good time to jump in if you are a market timer. Many years have December rallies and also January is the beginning of a new year and people are full of optimism and new year's resolutions, including the stock analyst at the major firms. They need to prognosticate the big "new winners" for the coming year.
Also on the monthly front is the famous "Sell in May and go away". The thinking is that everyone on Wall street is taking their vacations and spending all that money they made during the beginning of the year. They do not want to leave open positions while they are on the beach and not paying attention to the market. So probably not a bad month to lower some of your stock positions and raise some cash.

Best Regards,

Freewilly