"Maybe the medicine you need to improve your financial health can be found right in the Healthcare sector stocks"

Dow Jones Industrial Average   11092.00  (Down) week ending November 26th

TEVA PHARMACEUTICAL LTD

I keep hearing on the news that everyone keeps talking about their
401K accounts being down so many % points and needing to be restored to health. So the doctor is in the house to see if we can give these sickly accounts a booster shot and restore them back to health. 
TEVA PHARMACEUTICAL LTD. (Symbol TEVA, $50.69) stock price, despite the company doing well, has been on "the paddles" in 2010 suffering from a case of Obamacare worries. 18 analyst's love Teva as a buy, but can't seem to get their money out of their wallet with the stock being down in price year to date. Teva's five year revenue growth rate is 22.47%. Earnings for 2010 are looking like $4.57 and for 2011 is $5.24 per share.  For disclosure's sake, I did take a position in this one because it was so ridiculously cheap here.

If you are looking for something more like a shot of adrenaline
then  Alexion Pharmaceuticals Inc. (Symbol ALXN, $76.85)
may be the medicine you need for that IRA account. If that pulse is weak, hold on, because Alexion has a 5 year revenue growth rate of 290.72%. That combined with 62.10% NET profit margins will get the heart racing a bit.

If your retirement literally needs its heart fixed up,
 Edwards Lifesciences Corp. (Symbol EW, $65.94) will take care of those valves in a jiffy. Edwards has a 3 year return over 166%. 5 year earnings growth over 22% could be just the stress test your 401K needs to get in cardiovascular shape.

If you want to get a nano solution for your 401K woes you can get your microscope and zoom in to the genetic level and get yourself fixed up with some shares of Illumina Inc. (Symbol ILMN, $61.00).
Illumina has a five year sales growth rate of 61.45%. Earnings are also growing very nicely here with 75% gross profit margins.

If you keep adding to your 401K you should keep averaging up and  you will move forward as the economy rebounds. It is harder to do that in your IRA account since you do not have a payroll deduction going in. So when you retire enjoy the small things. Life is a gift and you should always be learning. Read books, they are a very good return on your investment in yourself.

Enjoy the arrival of Winter and all it brings.

Freewilly



  

 

"Time to see where the Sunny in Philadelphia gang are investing their money"

Dow Jones Industrial Average 11203.55  (UP) week ending 11-19-2010

Well we heard from Ben Graham last week here at Freewilly's Stockpicker blog so I thought we would go to the other extreme for some expert advice on investing from our local Philadelphia celebrities from "It's Always Sunny in Philadelphia" . Surely their interesting views of the world will turn up some real hits.  They all invest based on their personal interest, and of course, based on a 1-3 year Fundamental Analysis,  just like my blog.

We will start with "Mac" because he always claims to be the leader of the TV "Gang". With his Kung-fu and many kick-boxing tactics he would like the super sports picks , Under Armour Inc. (Symbol UA, $54.25) to get that slim look he wants and  CABELA'S INC. Symbol CAB, $21.86) to get all hunting gear that he needs to take on opponents. Born in Philadelphia, he truly understands the Philadelphia mentality of throwing snowballs at Santa Claus.

"Charlie", another star of the Gang at Paddy's Pub,  would definitely be looking to invest in  Snap-On Inc (Symbol SNA, $52.89) because he needs his various tools to kill small baby rats. His second pick would be PETsMART Inc. (Symbol PETM, $37.84) because Frank and him at times have been reduced to eating cat food in their slum apartment. Yuk!  Although Charlie frequently abuses inhalants such as glue and spray paint he comes in with some good insights for stock picking. As Co-owner of Paddy's pub he also has an affinity for Boston Beer Company, (Symbol SAM, $82.26) but thinks you need to wait for it to come in a little bit and change it's name to Philadelphia Beer company. But that name is taken, so then simply change the name to Paddy's Beer or Charlie's Beer. 

"Dennis", who was raised on the Mainline with his twin sister Dee and father Frank , has a very high opinion of himself. He will be mad I didn't put him first in this article. Dennis would probably go for Proctor and Gamble Co. (Symbol PG, $64.05) because of their new Dove for Men skin care soap to make him look good. He would also buy shares of Google Inc. (Symbol GOOG, $590.83) so he could look good with his friends and smart for buying such a good and high dollar stock. Though in one Episode,
he and Dee decide they are going to go on welfare and not work anymore.
They end up desperate to the point where they would probably search in dumpsters for food. So he would also like Waste Management Inc. (Symbol WM, $35.22)  because of their vast supply of dumpsters.



Dee, also known as "Sweet Dee", has an affinity to wear Angel Wings so is torn in her stock choices between Victoria's Secret owner Limited Brands Inc. (Symbol LTD, 33.01) and the super chic Philly based Urban Outfitters Inc. (Symbol URBN, $37.26) . Like most females she can't decide so she will probably buy both of them.
Deandra, who was unpopular in high school because of having to wear an aluminum back brace, aspires to be an actress, so she might have an interest in  Dreamworks Animation (Symbol DWA, $31.08).  Maybe she could turn Charlie's dream book into a movie.

Frank, what a father. He water boarded his daughter Dee in the urinal at paddy's pub to gain a confession from her.  Frank's dream is to have a Hawaiian Luau feast for his birthday and roast a Pig. He would purchase Sanderson Farms Inc. (Symbol SAFM,  $42.61) and  Hormel Foods Corporation (Symbol HRL, $47.64) so he would have a steady supply of Pigs!  Frank is also very impressed with Sherwin Williams (Symbol SHW, $73.12) because of the fine job it did with painting the dilapidated boat that they had purchased. He also loves their paint for using for doing graffiti work. Frank, the always shady business man who owned a Vietnamese sweatshop, would certainly want some Casino action and would like the low priced Boyd Gaming Co. (Symbol BYD, $8.95).

The ever strange McPoyle brothers which are the nemesis of "the gang" would buy Tasty Baking Co. (Symbol TSTY, $6.35). Why, because it's Philadelphia, and Tasty is where the Chocolate Junior comes from.


Tasty Baking, the Philadelphia based baker is an earnings turnaround story into 2011 and a possible buyout candidate.
 
 
 
The Waitress and Rickety Cricket also send their regards. The are putting their money in Philadelphia Municipal Bonds. They are hoping that the Phillies do not win another World Series and cost the city an expensive million dollar parade! 
 

So join the "Gang" and watch them every Thursday night on FX at 10:00.

Best Regards,   Freewilly

"An observation from Benjamin Graham on finding stock value when markets are up and margins of safety are thin"

Dow Jones Industrial Average 11,192.58  (Down) week ending 11-12-2010

 Benjamin Graham in his landmark investing book "The Intelligent Investor" notes that more money has been lost in the stock market by individuals buying secondary, lower quality company stocks at a value than from buying high quality stocks with a reasonable price premium attached to them when stock markets are at higher levels or have run up.  Such is the situation we find ourselves in today with many of the better quality stocks being sold and purchased with a substantial premium attached to their price.  So one should be cautious stockpicker at this time. One method to increase your odds of success in these times is to buy quality stocks that pay a dividend premium which attached together with their mild growth capital gain, will give you a good overall annual return.

 One such stock that I found this week and purchased with cash in my IRA account was BOARDWALK PIPELINE PARTNERS LP (Symbol BWP, $32.25).  Boardwalk is a partnership that owns 3 interstate gas pipeline systems plus integrated storage facilities. They currently pay a 6.39% dividend annually to the partners. The company operates at almost 25% Net profit margins with annual earnings per share from $1.39 in 2010 to $1.62 per share in 2011. My thinking here is to take the dividend and have the stock rise 10% which is a stock price of $35.50, a mild rise. This will give me a 16.39% annual return in an enviornment where the GDP is only running at 2% , so with only mild inflation risk.

My longtime friend , Michael Rodman, up in the Boston area had told me months ago about this high dividend yielding stock and I just sorta filed it away in my memory banks.  Frontier Communications Corp. (Symbol FTR, $9.00) is the company and it doles out an 8.3% dividend yield . The company is all topsy turvy`right now because of a gigantic aquisition from Verizon of telecom properties thereby tripling the company's size and doubling their debt. Frontier says they can run these propeties alot better and they are probably right. The stock only needs to see a price of $10.00 per share and you have a total return of 18.3% on an annual basis.

 My third pick is right in the middle of the Smartphone and wireless
craze and is very well managed. AT&T Inc. (Symbol T, $28.46) has a tidy dividend that pays 5.9% out of their never ending pile of cash. Amazingly the company has a 5 year sales growth of 24.45% according to the stats in SmartMoney. 17.80 % net profit margins and the company is projected to earn $2.49 per share. I can picture a total return here of 16 -18% with very little downside risk.

 So be careful out there as the captain of your financial ship.  When you are driving through icebergs, don't have the throttle on full speed ahead.
 We all know what happens when you do that!

 Have a good weekend and good luck with your fantasy football team.

 Freewilly   

Some "Last Mile of Fiber" small cap names and some other worthy Tech stocks

Dow Jones Industrial Average   11118.49  (UP) Week ending 10-29-2010

I thought I would be clever and do a blog on stocks that are making money in the "last mile of fiber" space with the Carlyle Group interest this week to buy Commscope (Symbol CTV, $31.65). What I found was  a few small cap names of interest and some other Tech names I found that would be good 1 to 3 year investments for Total Return. The old adage "you should not invest in things you don't know about" applies here, as there are all different ways to get past that last mile including: wireless, copper cable with fiber assistance (phantom DSL), cable, fiber itself, fiber-to-the-node broadband over powerline, satellite, microwave and it goes on and on.   

Alliance Fiber Optic Products, (Symbol AFOP, $11.00) is a small cap name for you. The stock is up 100% this year. Earnings for 2010 of .72 cents a share and 2011 of .87 cents a share. This well capitalized company has a lot of head room for sales increases.

DragonWave (Symbol DRWI, $8.15) is an Ottawa, Canada based company that derives allot of revenue from wireless backhaul of voice and data. DragonWave has just won a pair on contracts and are focused on the new LTE and WIMAX markets. As always these small cap names can take you on a wild ride on the stock chart, you just need to remember that your ultimate destination is up.

Ceragon Networks (Symbol CRNT, $ 11.06) Tel Aviv based company that is a provider of high capacity LTE/4G ready wireless backhaul solutions. Both Ceragon and DragonWave are both active in the cellular market in India. Projected earnings for 2010 of .42 cents and for 2011 .65 cents a share. This is another stock that has been on a wild one year ride, so hold on to your hat!

The next three tech stocks I found in my travels in no particular order are well established and will work for most portfolios for Total Return. 

F 5 Networks, (Symbol FFIV, $117.70),  Altera (Symbol ALTR , $31.24 ),  First Solar Inc, (Symbol FSLR, 137.68).  These guys are like Halliday, Oswalt, and Hamels. You may not win the World Series , but your team will definitely have 90+ Wins. 

I should always mention that tech stocks historically have always been the source of my biggest losses in markets past, but also some of my biggest gainers.  So if you are going to stand at the plate, you need to swing the bat to hit a home run, otherwise you will be out "Looking", which Ryan Howard of the Phillies can tell you, is a very bad thing. 



Be Happy..... Freewilly 



"They may be foreclosing on the house, but you can bet that the kids will get their toy gifts for the holidays"

Dow Jones Industrial Avg. 11,063  (UP) for the week ending  10-15-2010



Star Wars - Darth Tater Figure
 PlaySkool - Hasbro

  Times are tough. 462,000 people applied for unemployment benefits last week. Housing prices are bottoming and foreclosures seem to be on the rise. But you can take it to the bank  " Kids will not go without receiving their share of toy gifts during the holidays".

The most rock solid company in this area seems to be Hasbro Inc. (Symbol HAS, $45.08). Hasbro stock chart has been on a steady rise during 2010. This stock has had a one year Total return of 67.9% and a 3 year Total return of 58.6%. If you had invested $1000 five years ago it would be worth $2713 today. Earnings for 2010 are $2.65 per share and for 2011 $3.12 per share. Transformers, Dora the Explorer, Yahtzee, Hannah Montana, and Mr. Potato Head are among the over 100 brands they have.

The second very well recognized brand in this category is Mattel.  Mattel Inc. (Symbol MAT, $22.45) had got beaten up a little bit the end of this week for some soft Q3 top line sales and the stock is now a pretty good value at this price. Mattel has some long term debt to work off. They had bought out Fisher-Price back in 1993 to challenge Hasbro. Mattel and RC2 (symbol RCRC) have both been under the gun for lead paint on toys and baby bottles and have had to do some financial settlements. Don't forget Barbie and HotWheels!

My Sleeper Pick in the toys area is  SHANDA GAMES LIMITED ADR (symbol GAME, $6.52). This very profitable company is something to take a flyer out on as a more speculative pick. The financials look pretty good and I do not see any analysts following it. The stock is down this year on a Goldman Sachs, June downgrade and I think no one is paying attention to it now. It is a play on online games in China and area that surely will have allot of growth. 

In the Electronics games area I still like Activision Blizzard Inc. (Symbol ATVI, $11.37)  because of their tremendous balance sheet.


HHGREGG INC. (Symbol HGG, $23.96) which sells video games and systems looks like a younger version of Radio Shack (Symbol RSH) and appears to be growing nicely.  It has a one year total return of 45.3% and a 3 year total return of 52%.

What is America's favorite toy?  I will let you decide that.  Hopefully it is something that is creative to develop those young minds and fun most importantly. 

Freewilly     

  (We went with a new cleaner logo this week and took off the non-stock related personal stuff)

"Perk up your portfolio with some fast growing Coffee Stocks and we'll throw in a sandwich stock too!"

Dow Jones Industrial Average   10,986   -  daily close on October 6th , 2010

I want to start with a special dedication wish  to the love of my life, my wife Deborah. Tomorrow we celebrate our 30th Wedding anniversary and she is an amazing and wonderful woman who is kind, generous, hard working, sexy, funny and brilliant. Did I miss anything? Most definitely.  So anyway, we make three kinds of coffee in the morning. A pot of decaf for me, A pot of half-caff  for my wife, and a pot of full -caff for my daughter. It is no wonder that the coffee stocks are doing well with everybody having their own special pot! Such is the secret of coffee's success. Everybody likes it a different way.

     Green Mountain Coffee Roasters (Symbol GMCR, $28.67) has a long term growth rate of 37.37%. Earnings per share in 2010 are .69 cents and in 2011 $1.18. The 3 year Total return on shares of the stock is 225%. Get the picture?  You just take the little single serving cup and plunk it in the machine at work and out comes the coffee. No burnt coffee sitting in pots like the old days!

  Peet's Coffee and Tea, Inc. (Symbol PEET, $33.80) is a company with a 17.33% long term earnings growth rate.  5 year sales growth is 14.15% and these guys will deliver groceries to you too! 2010 earnings per share are looking like $1.29 for 2010 and $1.55 for 2011. This California based company has a Quick ratio , (assets to liabilities) of 6: to 1, and plenty of space for upside revenue growth.

Caribou Coffee Company (Symbol CBOU, $10.44) is our low priced stock entry here. This Minnesota based company is up 38.86% year to date and 54.24% over 3 years. Sales are growing about 8% a year, but if you are in Minnesota it is cold in the morning and you will need your coffee to warm up. This is worth a look as a Small Cap holding in your portfolio. 2010 earnings of .42 cents per share and 2011 is projected at .56 cents per share. 

Of course you can't do an article about coffee without including the mega growth company, Starbucks Corp. (Symbol SBUX, $26.10). This company even after all these years of expansion is still growing at 11.5% a year in revenues. Kudos to Starbucks for making medical benefits available to part time employees. It shows companies can still make money and help people Too! 2010 earnings will be $1.24 and 2011 projected at $1.42 per share. One year Total Return of   38.6%. Enjoy your Mocha FrapaChino.  Starbucks is also the inventor of a whole new language that you get to learn to speak!  

......and now for your sandwich course we will be serving up Panera Bread Company, (Symbol PNRA, $88.66).  This dynamo has a 5 year sales growth rate of 19.6%. A one year total return of 48.6 % and 3 year total return of 123.5%. 2010 earnings of $3.54 and 2011 earnings projected at $4.16 per share make this bakery-cafe business the best of bread and coffee.

They are an excellent long term BUY.

These big company logos are messing up my spacing!  But you can buy any of these stocks with a 3 year time horizon and you should do well.

Have a wonderful day. Stay healthy and safe.    Freewilly

"Let's take a look down at our feet and see if we can come up with any investment ideas"

Dorothy's Ruby Slippers

Dow Jones 10,860  (UP Strong)   Week ending 09/23/2010

 Why Shoes?  My daughter Molly told me I should buy stock in Chuck Taylor's Converse High top sneak company because they have been around for ever and are very popular.  Sometime in 1908, Marquis Mills Converse decided to start a rubber shoe company, bypassing a rubber trust that prevented most companies from doing business directly with their retailers. Early catalogs bragged about how many trucks left the Converse factory in Malden, Massachusetts, delivering product directly to stores in Boston. Mr. Converse’s idea worked. But more importantly, it survived. Chuck Taylor then joined the company in 1918. Unfortunately , as far as I can see, the company is privately held and not traded as a  common stock.


Converse High Top Sneaks 


 So what shoe companies should you buy stock in? My wife Deb tells me that Skechers USA Inc. (symbol SKX, $22.12)  sells sneaks that when you walk in them they are designed to make you lose weight? Novel idea. Skechers has a very reasonable PE (price earnings ratio) of 6 , with earnings for 2010 of $3.79 a share and for 2011 of $3.89 a share. That is not a big year over year increase, but still very good numbers for a stock trading at $22. Quarterly sales numbers rolling forward look very good, so I would call this one a very reasonable BUY. 

My hero Jim Cramer scooped me on Friday with

Nike Inc. (Symbol NKE, $79.57) because they had come in and reported good quarterly earnings on Friday. This blue chip stock is the 800 pound gorilla in this shoe space. It has a 3 year Total Return of 40.8%.  With long term earnings growth running 12% and the company trading at a PE of 18, there is no reason to rush into the stock here.  For a conservative investor that wants to grab this and stash it away in an IRA account for total return over 5-10 years, with it's dividend it is a very high quality Large Cap investment and would make a solid building block in your portfolio.  

If you are looking to add something with a little more juice for the short term, Deckers Outdoor Corp. (Symbol DECK, $47.61) is the shoe stock you are looking for. Long term earnings growth of 24.33% and earnings per share in 2010 of $3.53 per share and in 2011 projected at $3.94 per share make DECK an excellent stock for you to own in your portfolio. 5 year sales growth of 30.29% and with a one year total return of 68% , Deckers is the best pick in this shoe area of stocks with many years of growth ahead.

P.S. ****   I did not discuss Adidas, which also owns Reebok, because it trades on the German Deutsche Boerse in Frankfort as part of the DAX 30. They do trade an American Depository receipt (ADR symbol is ADDDF), but with very little data provided.

So lace up those sneaks and boots and get ready for some fall hiking. The leaves in the Northeast USA are beautiful this time of year.

  Happy Hiking and Running,      Freewilly.

  

"Sometimes things get silly and I just have to send out a friendly reminder"

Evening of September 23rd, a Harvest Moon outside.

This is not my normal blog just a warning to my friends that I will occasionally send out when I see things that are dangerous out there . 3 stocks that are, on a fundamental basis, well overdone and you quickly need to back away from. 

 First , Netflix, (symbol NFLX, $160.47). The stock is currently at a PE of 65. I had spoke about it earlier in the year at a much lower price. They have not reinvented the wheel here, and this media will soon be delivered directly via the Internet, fiber or cable. This will not end well.
SELL! SELL!SELL!  

     Also the two darlings of the "Cloud Computing Club".
Akamai Technologies Inc (Symbol AKAM, $50.59) with a PE of 62.46 and SalesForce.com (Symbol CRM, $117.49) with a PE of 179.83.  If you are buying or owning these stocks at these levels, the only thing in the clouds is your head!

Remember When:   The Optical stocks were growing at 40% a year and you were buying Sycamore Networks for $115.00 a share and it was supposed to go to $165.00. Or how about when Qualcomm was at $700.00 a share and Henry Blodgett boldly said it would probably go to a $1000.00 a share?

Does any of this sound familiar?    Haven't we been here before?

Hello, McFly, anybody home in there?

This is just to say, don't get Silly out there.  Stick with the fundamentals and avoid bubbles like these and stay out of trouble.

Good Evening,

Freewilly 
   

"If Johnny Cash was still around he might write a song about Coal & Steel and the miners that work down in the earth"



Johnny Cash & Bob Dylan

Dow Jones  10607.85   (UP)  Week ending Sept 17th

Johnny Cash always wrote songs about the folks that had the hardest path in life to survive, like convicts, outlaws, gun fighters, drifters, and people with family tragedies. Generally Johnny hated anything Elitest and always sided with the view of the common man, people like the coal miners. Johnny sang an old Billy Joe Shaver song called "Old Chunk of Coal" and it went something like "I'm just an old chunk of coal but I'll be a diamond some day, I'm goin to get rid of every flaw". Well I have a feelin that those Coal Miners are going to be working even harder next year because that "Old Chunk of Coal" and Coal stocks are going to turn into diamonds next year because of the tremendous demand by Asia-Pacific countries for metalurgical coal to manufacturer Steel.

   This also bodes well for Johnny's other favorite subject "Railroad trains" headin west (and other bulk shippers). But for my conversation I will be speaking about the Coal stocks. These earnings projections for 2011 jumped off the page at me and my financial advisor Vince confirmed  my thoughts with some excellent Morgan Stanley Smith Barney research on the subject. So here goes with my picks.

Arch Coal ( Symbol ACI, $24.71) is one of the best pure Coal plays that you can invest in. earnings projections 2010 - $1.08 per share, 2011 - $2.66 per share, 2012 - $4.00 per share.  Coal companies do not normally operate at high profit margins so this is all going to be volume increases to boast up profits. Those poor coal miners are going to be working allot of overtime and longer hours to keep up. Sing it Johnny, "flesh and blood and toil in those dark & lonely mines". ( I hope the miners have some profit sharing plans!).

Peabody Energy Corp. ( Symbol BTU, $47.00) will also be humming a happy tune with earnings in 2010 of $3.03 per share, 2011 - $4.53 a share and 2012 of 6.26. Try to find another industry projecting this type of earnings growth.  Peabody's 3rd quarter profits were up 35% mostly due to metalurgical coal production and sales. They have a litle bit better return on equity that Arch Coal, (a little more profitable by controling cost, i.e these coalminers are workin hard and are good at their work).

 If you prefer something with a big dividend yield instead in the coal group,  PENN VIRGINIA Group Holdings (Symbol PVG, $22.07) might be your cup of tea.  Penn (PVG) will have the growth in earnings from Coal and will pay you a safe 7% dividend while you wait. Good for IRA accounts to give you some growth and income.

So look for the BLUE logos, make some money, and think
about and be kind to Coal miners like Johnny Cash would.

Freewilly

"Some stocks to hang your hat on that include bonus dividends in an increasingly volatile stock market "

Dow Jones 10447.93  (UP) Week Ending  09/03/2010

Has this stock market been tossing you around like a roller coaster ride at Dorney Park?  Well you are not alone. We have been in this 10,000 - 10,600 trading range all summer and people are having trouble getting their bearings. The high unemployment continues to raise questions of whether we might have a double dip recession.  Remember though, that the highest unemployment is seen at the end of a recession. The numbers I am seeing tell me it looks like the stock market put in a bottom in early June 2010. No matter what happens you can beat your cash/treasuries holdings with these four stocks that give you growth at a reasonable price and a nice dividend.

The first one is Coca-Cola Co. (Symbol KO, $57.56). Yeah Warren Buffet gets it right with this one. This soda fountain of cash generation pays a 3% dividend even before you start getting returns for it's growth . KO is projected to have earnings of $3.75 per share in 2011. The companies 1 Yr % Change (TTM) is 16.10%. You can do the math, this is a no brainer compared to the return on your money market fund.

 The next one is Honeywell International Inc. (Symbol HON, $42.82).  Collect your 2.83% dividend up front, this stock is up 18.5% over the last 12 months. Another stock you will not lose sleep over in this computer trading dominated market. We need you retail investors back! This company has a great return on equity and
it continues to gobble up small profitable security and monitoring companies. 2011 earnings are projected at $3.04 per share.

 E.I. DuPont de Nemours & Co (Symbol DD, $42.51) has had a nice run up since June and pays you a 3.86% dividend. This company does not have much sales growth but has a 40.90% Return on Equity and the stock has a 37.4% total return for the last 12 months. Is your stable asset fund giving you that??  Projected earnings for 2011 is $3.23 per share.  Remember , chemical stocks traditionally are the first to lead the way out of recession. Kick in lower oil prices which is a benefit to DuPont's bottom line and you have a pretty good idea here. With a PE of only 12, Dupont is a fairly safe bet.

Stock analyst generally hate Airline stocks because they are always
going bankrupt. But Ken Heebner in 2010 has made good money with them with US Airways and UAL, so I thought I would add my own pick. Southwest Airlines Co. (Symbol LUV, $11.57). Southwest is the sweetheart from the UAL/Continental merger deal and they pickup 36 slots at Newark Liberty International Airport in the lucrative New York City market. This could be a catalyst for growth in the stock. If you have ever been out to Chicago's Midway airport you know that Southwest fires off jets out of there like clockwork and their whole fleet is all exactly the same Boeing 737 jet to keep their cost down. No dividend here really (0.16%), but the companies 1 Yr % Change (TTM) is 37.57% which easily makes up for it. Earnings for 2011 projected at .95 cents per share according to Barron's and could pop over into triple digits, (over a $1.00) which would pop it up on analysts radar. I would not be surprised to see this stock get back to $15.00 per share.

So let the market go where it wants to and enjoy your fall with some stock buys that will
steer you through the turbulence.

Freewilly


 

Request Weekend - Part II - takes us to startup Tesla Motors in California which just went public in late June 2010

Dow Jones 10,151  (Down)  Week ending August 27th

Tesla Roadster

Well what a perfect way to end the summer
to put the top down and talk about and take a cruise in the Tesla Roadster the Electric Beauty to the right. http://www.teslamotors.com/roadster
   To be honest when I got this request I was thinking in my head "Delorean, they'll be out of business in a year" but as I started doing my investigation I discovered reasons that I think they will ultimately be successful.

 TESLA MOTORS, INC (Symbol TSLA, $19.70) stock debuted at $17.00 and the low so far on the stock has been $14.98 and the high $30.42 . The stock had it first quarterly report and like most start ups it recorded a loss in it's first quarterly report of $5.08 per share. They have a profitable business model but just needed to bring sales up to a point where they cover their high SGA and Research and development expenses. You almost have to think about these guys like they are a bio-tech stock trying to find the cure for cancer, except they are trying to find the cure for our dependence on foreign oil. It takes time and money to get going, so keep an eye on cash-burn.

     Why will they be successful? People are fed up. They are angry about the oil environmental disaster in the Gulf of Mexico. They are sick and tired of being held hostage by the oil companies from foreign countries and having to pay ever increasing prices. You push people hard enough and they dig their heels in to fight back. If you drive one of these vehicles 15 years you save over $20,000 in gas and oil cost , around $1300 per year at current prices.

       Some other reasons, there are a lot of mutual funds looking for "green" investments like this and are willing to hold this type of investment for the long term. Also it appears that they have a lower cost Model S version (pictured left) to get their pricing down a bit.  Also don't forget that all the cool new stuff starts in California and then heads east, like the personal computer, Jimmy Hendrix, The Grateful Dead and The Beach Boys. 

Tony Helmholdt inventor of twin powered
Electric motorcycle 

I also found an article about a 23-year-old named Tony Helmholdt who works for Tesla Motors in Chicago.  About 25 or 30 Chicago area drivers own Teslas, and Helmholdt is helping owners maintain their $100,000 sports cars. But more importantly he has invented and built a a twin-powered electric motorcycle. Now there would be something with a mass market appeal that would give Tesla the cash flow to sustain their car line until sales ramp up. I have no idea if or when Tesla would produce this item. What is certainly clear is that all this electric stuff is coming soon so get used to it.

On purchasing the stock, I would would wait until October 2010 since the earnings report is already out and a lot of the newbies that bought it on the public offering will get impatient and probably dump it. I would look to buy it as a 3 year long term investment in the price range of  $15 - 17 per share range, which I think you will see again. This is, be warned, a High-Risk Investment.

So honk a horn, so I hear you coming and take a cruise in a Tesla Roadster!
Joe, you should test drive a Roadster on that road that goes between San Mateo and Half Moon Bay. While you are in San Mateo stop in at Nick's Deli if it is still there. Try the Chicken salad sandwich.

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