"Adding some muscle to my lineup in this highly volatile market. A little growth, a little value, and one muscular biotech-pharma stock"

Dow Jones Industrial Average 16,472  (Up) Week ending 10-02-2015

Greetings. I am like all the other investors currently here trying to get a foothold 
and to position my portfolio correctly to move forward.

I even went so far as to listen to George Soros's lectures on Reflexivity and its relation
to financial markets, which are contrary to the traditional market accepted ideas on 
stock theory that emphasize Equilibrium as the rule. I had previously prejudged 
George S. because of his negative view on my George, (Bush 43). What Soros really
 is against is the Patriot Act. It is contrary to his views and philosophy on the 
"Open Society". It is a tough call between "freedom versus safety".  I have read
 his economic  theories with an open mind, and on that front, all must admit that he
 is absolutely brilliant. 

So while the market has corrected, I have taken some profit on winners and even 
sold out my Disney position. I took the cash to reinvest here and add to some 
smaller positions that I had established earlier in the year.

I wanted to add some muscle to my portfolio with these 3 picks. So the first 

thing I did was to add to my position in MobileEye N.V 

(Symbol MBLY). 

This growth stock has doubled revenues 3 years in a row. I added to a previous 

position I had taken in the stock to move MBLY into a "Top 10" position in my

portfolio. I feel it is a good "Growth" component in my portfolio going forward. 

Barron's Magazine this weekend had an article about how General Motors Corp. is

looking at their technology favorably. Safety is important and MobileEye's software 

is tops in that department. It does not meet either of my normal criteria on ROE 

and PEG ratio so from that standpoint it is somewhat speculative.

My second stock, is my value stock pick, that I added to my position in. Time Warner Inc. (symbol TWX). while everyone else is loading up on Netflix, I am buying this ignored owner of HBO, Turner Broadcasting and Warner Bros. and all their valuable media assets. The stock should be trading at $120 per share based on earnings going into 2016 and it is at $70 per share. HBO is winning all of the awards, so add to your position in this one right here. This stock meets both my ROE and PEG rules.

My third pick that I added to was Celgene (Symbol CELG). I broke 

Jim Cramer's rules and averaged "UP" when I added to this position, but I was 

buying it on a big recent dip. Sometimes you just need to use common sense 
and break the rules. It was an opportunity to put Celgene in the Top 10 in my portfolio
 and so  I took advantage of it. This company is rock solid for the next few years. 

So with these 3 stocks I have added great muscular strength to my portfolio. I felt that 

this was the best strategy in this trading environment, just add "Tough guys". 

Like Popeye below you need to feed your portfolio some "spinach" and keep it strong.

Trade carefully and always improve your stock positions. 

Freewilly

"Finally I get a chance to write about one of my 15 for 2015 stock picks. Oshkosh Corp. (Symbol OSK), which was already a great value stock, won a contract from the US. Army for $6.7 Billion dollars to build military vehicles"

Dow Jones Industrial Average 16,102.38 (Down) Week ending 09-03-2015

Oshkosh Corp. (Symbol OSK, $39.60) has always had great value fundamentals by my standards. A PEG Ratio of 0.83 and a Return on Equity of  15% were always good even though revenues had been declining for the last 4 years. It was one of my 15 for 2015 stock picks this year.

    Now that has all changed. August 25th, 2015 Oshkosh and Oshkosh Defense were awarded by the US Army a $6.7 Billion dollar contract to replace the military's aging fleet of Humvees with 17,000 Oshkosh JLTV vehicle. That amount is larger than its whole 2014 sales Revenue for the year! Add to that a 10 Million share stock buyback announced on Sept 1st and a possibility of another $50 Billion in contracts to replace the rest of the old Humvees and now you have a sweet 3-5 year story on a stock that already had pretty good fundamentals.

Some other good things about Oshkosh, the book value on the company is $25.57 a share so you are not paying much for the operations. Ben Graham and Warren Buffett would like the setup on this stock. Also the dividend on the stock is 1.72% so you get paid while you are waiting for your capital gain.

So lets look at some earnings information. 

The company is projecting 15% Annual earnings growth and should see that or better going forward. Earnings per share for 2015 are projected at $3.15 per share and for 2016 they are looking like $3.63 per share with a forward PE of 11.10 way below the market's current PE. (FYI, truck and auto stocks tend to trade at lower PE's in general when you a pricing them for valuation unless your name is Tesla.)

There is really good Insider buying on this one also. The future looks very bright here.
I purchased the stock around this price on Friday and you can buy it here with not to much downside risk. Even if we have another downside Tsunami in selling, this one should spring right back. China and interest rates will have no effect on the story here.

Enjoy your Labor Day weekend here in the USA. Everywhere else enjoy your regular weekend. Keep an eye out for bargains like this and leave comments with your own suggestions on my blog.

Freewilly

I don't think we are quite at a bottom yet, but there are some names that you can start to accumulate here for a long term investment. AXP, GILD,DIS,TWX, and AAPL

Dow Jones Industrial Average 15,459.75 (Way Down) Week ending 08-21-2015

(The Dow Jones averages have now corrected 10.9% off of its high for the year.)

 So after an ugly month of trading in August most accounts are back where the started back in January this year. Flat as a pancake, but oh what a fun ride. 

I don't think the market correction is quite over yet, but here are some names you can buy for the long term as we settle in and put in a bottom. These are all Large Cap names and should be familiar to you. Since it is September just about, we will look at 2016 forcasted earnings.

The first one is American Express Corp. (Symbol AXP, $77.15). This stock is trading at a PE of 13.54 and is forecasting earnings per share of $5.68. You will not go broke buying some of this.


2nd Pick would be Gilead Sciences Inc. (Symbol GILD, $105.33).  This stock has a PE of 10 and is projecting 2016 earnings per share of $11.55.  

 The third stock would be Walt Disney Corporation (Symbol DIS, $98.84). This one the bean counters have thought the "sky is falling" because of cable bundling coming undone. Evidently they do not understand the power of the "Force" and that Star Wars is coming one after another for the next 5 Years. Consider Disney 10 times more powerful than the Death Star in Star Wars. You can invest as much as you like in this name. Fire at will!  Disney has a current PE of 20.55 and is forecasting 2016 earnings of $5.59 per share.

Speaking of Death Stars, here is a little company that has $194 Billion dollars of cash on it's balance sheet, Apple Inc. (Symbol AAPL, $105.76). Apple currently has a PE of 12.21 and is forecasting 2016 earnings of $9.73 per share. The stock frankly should be trading at $160 - $180 dollars per share. This one is a layup at this price, a no brainer.


 The fifth stock is Time Warner Inc. (Symbol TWX, $72.70). This company has the least exposure to the fickle AD revenue business. They are about Content. HBO, Warner Bros., and Turner make up a powerful and expanding lineup. Time Warner Inc. currently has a PE of 17.1 and has 2016 projected earnings of $5.72 per share. This stock is rock solid and can be purchased here at this price.

As always be careful when buying stocks. Smaller is better because you can always buy more later.

Have a great weekend,

Freewilly

In this trading environment you need to look for solid companies with little debt. If you like the stock of Home Depot, you will probably also like the stock of American Woodmark Corp. (AMWD)

Dow Jones Industrial Average 17,690  (Down)  Week ending 07-31-2015

Greetings. I found a really nice small-cap stock that only two analysts are following. One has a Buy rating and one has a hold. My rating is to buy it on a pullback, because it just had a recent big breakout and run up in price. 

The company is  American Woodmark Corp. (Symbol AMWD, $65.76). 

"American Woodmark Corporation manufactures and distributes kitchen cabinets and vanities for the remodeling and new home construction markets. American Woodmark was incorporated in 1980 by the four principal managers of the Boise Cascade Cabinet Division through a leveraged buyout of that division. American Woodmark was operated privately until 1986 when it became a public company through a registered public offering of its common stock.

 

American Woodmark currently offers framed stock cabinets in approximately 500 different cabinet lines, ranging in price from relatively inexpensive to medium-priced styles. Styles vary by design and color from natural wood finishes to low-pressure laminate surfaces. The product offering of stock cabinets includes 85 door designs in 21 colors. Stock cabinets consist of cabinet interiors of varying dimensions and construction options and a maple, oak, cherry, or hickory front frame, door and/or drawer front.

 

Products are sold under the brand names of American Woodmark®, Timberlake®, Shenandoah Cabinetry®, Shenandoah Value Series ™ , and Waypoint Living Spaces®."

Sales through Home Depot and Lowe's make up about 45% of American Woodmark's company revenues.

AMWD based in Winchester, VA. has an ROE of 16.30 and the PEG Ratio is a little out of whack at 3.72, (That is why you should wait for a little bit of a pullback before you purchase shares). The current PE is 29.76.

The company had revenues of $825.5 Million last year and has a market cap of 1 Billion dollars. The company has a very healthy Quick Ratio of 2.9 to 1 and a Current Ratio of 3.32 to 1. The company has little to no long term debt. It pays a 0.55% dividend currently.

Earnings per share for 2015 are looking like $2.54 per share and for 2016 they look like $3.13 per share. Earnings this year are up 68.7%. EPS for the past 5 years have averaged 27.7% gain per year. 2016 earnings growth is projected to be at 15.71% and for 2017 19.34%.

The stock price has performed very well recently with a YTD gain of 62.61% and One year gain of 123.67%.

So a really nice American small cap stock to buy for you. Again, need to wait for a little pullback to jump in. (maybe when the Fed raises interest rates this year in around a month from now.)

Then when you make you big profit money you can go out to Home Depot or Lowe's and get yourself some new kitchen cabinets made by American Woodmark. Then everybody is happy!

Catch you next time around,

    Freewilly    

   

"This roller coaster stock market wants to make you reach out to a comfort stock. This old friend has been in business 66 years and comes at a slight discount. I am talking about Dick's Sporting Goods Inc."

Dow Jones Industrial Average 17,760 (Down) Week ending 07/10/2015

So how is your stomach doing in these roller coaster US Markets? We even had a day with the NYSE main floor halted for some hours , though 80% of the trades happen on sister electronic trading exchanges anyway. 

The whole week was very disconcerting with Apple Inc. stock breaking through a main bottom support level then suddenly bouncing right back the next day. Even with the bounce back it was a worrisome week for the retail investor. 

A familiar name that I like and that falls within my PEG and Return on Equity rules is Dick's Sporting Goods Inc., (Symbol DKS, $51.19). DKS has a PEG Ratio of 1.25 and a Return of Equity of 19.41. This company with 603 stores is financially in good shape with a current ratio of 1.57 and has a low amount of debt.  DKS did $6.9 Billion dollars in sales last year. The company has 93.6 million shares outstanding and currently pays a dividend at a rate of 1.09%. Insider buying has been positive.

The stock has been muddling along because of investors worries about online competition. Still over a one year period the stock is up 11.53% and YTD it is up 3.10%.

On the earnings side, Dick's is projecting $3.18 per share in 2015 and then $3.55 per share in 2016 and a projected PE of 14.48. The One year EPS growth rate has been 11.3%. The IBD earnings rating on the company is 82, so a pretty solid company for a roller coaster market.

I think Dick's diversified product line of Sporting Equipment, Footwear, Hunting and Fishing equipment, Sportswear and Fitness equipment makes it very resistant to on-line shopping. Dick's products tend to lend them selves to the brick and mortar store experience where you can touch and feel the products. Hard to tell the weight and balance of a fishing rod on-line!

I could see DKS being the target of Private Equity purchasers trying to buy it at a discount here and add a premium. Recent articles have suggested the same.

Analyst are pretty evenly split between Buy and Hold on their opinions on the stock.

I think it is the perfect stock for these markets with the expectation of a 10% return per year and no worries on the roller coaster market. People are going to buy the stuff they sell such as Under Armor sportswear, Callaway Golf equipment and all kinds of sneakers.

(Also the equipment for the ever popular US sport now of Lacrosse) 

So strap on your seat belt in this roller coaster market and pick up a little DKS so that you can keep calm and not worry.

Have a great gardening or beach or mountain lake weekend,

Freewilly

"This is no time to be buying stocks. Greeks are not going to budge and the Chinese are leveraging up a bit. I am having trouble finding good stock values within my investment criteria"

Dow Jones Industrial Average 18,027.63 (UP) Week ending 06/19/2015
Dow Jones Industrial Average 17.949.12 (Down) Week ending 06/26/2015

Time to do a little profit taking on your stocks. I even lightened up a bit on my Apple (AAPL) stock position this week because they need to run a sales gain over last years $212 Billion in Revenues, a tough task.You need to access the risk in your portfolio and take some corrective action. (DO NOT sell everything!)

The market is looking for a reason to correct and sell-off here. Greece, no matter which way it goes, will cool off any gains in Europe. The Fed is sure to raise a 1/4 percent on interest rates and throw some cold water on the US stock market expansion. The Chinese are having to ease up on capital requirements, (i.e.leveraging) to keep their economy going at a high clip. It is simply time for a rest stop here. 

There are some stocks I like that fit my PEG Ratio under 1.5 and Return on Equity of 15% plus after we have a 8 -10% correction. These stocks are good building blocks for a solid portfolio.

PPG Corp. (PPG), Gilead Sciences(GILD),Middleby Corp. (MIDD) and Disney (DIS) would be some of the names to look at.

I would like Merck here , (MRK), if the stock had not flat-lined for the last five years in price. They have made efficiency cuts but have dropped in revenues for the last four years. They need an activist investor in here to stir things up a bit. They have a nice dividend if you want to buy it and wait for something to happen.

My worse blog call of the year: Keurig Green Mountain Coffee. (GMCR). These guys have come down from a high of $155.00 per share to now $77.96 and falling in six months. This is where you try to "catch a falling knife" and it takes your hand off. Avoid even at this price!I thought the interest from Coca Cola would hold this one up a little better.

So get to your Greek ATM and get your money out and batten down the hatches. This could be a rough ride for awhile here. 

If your bored and just need something to buy, 

Ironwood Pharmaceuticals Inc. Cl A ,(Symbol IRWD ), is not a bad speculative buy here at $12.03 per share. The conversion price on their $300 Million Senior debt offering is $16.58 per share, so you have a lot of headroom here for a gain. Linzess is their product and they should have positive earnings in 2016. You may want to let this Greek thing play out first and get even a better buying position.

"Remember. The train does not always stay of the track!"

Enjoy your summer and keep your money in your pocket for now.

Freewilly

I threw in the towel on DFS, Discover Financial Services, one of my 15 for 2015 picks. It trades to much like a bank. I moved that money into American Express Company , (AXP) which is more popular with institutional investors, and is currently trading at a discount because of the loss of the Costco account.

Dow Jones Industrial Average 17,899 (Down) Week ending 06-12-2015

Discover Financial Services still has great numbers, but the stock is unloved by wall street. The Momentum guys trade up on Visa and Mastercard which are are near all time highs. I decided to go with another value credit card company trading at a similar PE to DFS and that at least I can be pretty sure will be more popular with institutional investors which include Warren Buffett.
You cannot chase these other momentum credit card names here. Do not fall into the trap.

American Express Company ( Symbol, AXP, $79.53) with a PE of 13.95 seems to be a better way to go here. Bernstein likes it with a target price of $94 or $95 per share. 

American Express has a PEG Ratio of 1.62 and has a Return on Equity of 28.60 so fits my investment criteria.  The operate at a Gross Margin of 73.3% and pay a dividend currently at 1.46%.

EPS for next year is looking like a healthy $5.72 per share.  The company employees 54,000 employees worldwide.

"American Express, don't leave home without it"  I think it is a safe bet for a nice 1 to 3 year return on your investment.

Enjoy the nice weather and head to the garden or the beach,

Freewilly

One side is saying "Bullish herd" of homebuilders on May 26th and on the other side Raymond James downgrades all the housing stocks on on May 15th. Myself, I am willing to put some coin on the stock of Lennar Corp. Cl. A , at the right price.

Dow Jones Industrial Average 18,010.68 (Down) Week ending 05-29-2015
Dow Jones Industrial Average 17,849.00  (Down) Week ending 06-05-2015

I apologize for the lost Month of May on the blog. A weekend working in Washington, DC, a Memorial day driving 1100 miles out to Western Pennsylvania and Wheeling, WV. to a niece's graduation and family get together. Then last weekend finally worked on the backyard garden on Saturday only to get heat exhaustion on Sunday which lead into a week long upper respiratory viral infection. See you really didn't need to know all that, but I didn't want you to think that I am just slacking off. 

While stocks in the US continue to churn and burn and merge and rise, I think a place that is still undervalued is Real Estate. The Federal reserve really can't raise interest rates more than like a quarter percent because of the currency and trade imbalances it creates around the world. The IMF is imploring them not to raise and delay it. Also the United States with it's 18 Trillion dollar debt load cannot afford a large rise in the interest service payments. So this all bodes well for the continuing improvement in the real estate market.

One way to play this trend is to buy a high quality home builder of new houses that are moderately priced to sell easily. Lennar Corp. CL. A (Symbol LEN, $46.71) is just such a stock. 

The stock falls in close to my guidelines on ROE and PEG ratio. The Return on Equity of the stock is 14.49% and the PEG ratio is 1.08.

Q1 Revenue was up 20% over last years first quarter which continues a 3 year trend of strong sales growth. The stock price is up 14.01 % for 1 year and 4.06% YTD. 

Earnings this year are projected at $3.17 per share and for next year $3.60 per share. They also offer a small 0.34% dividend payment

I believe the stock will continue it's long term growth path and should hit my $60.00 price target by the end of next year. That would be a 28% return over the next year and a half.

Because of the demands on my time in the summer months to not be sitting at a computer, I may write blogs as good stock opportunities arise and should be recommended. 

If you need to park money somewhere in the meantime, just park it in stock of AT&T (Symbol T). It pays a 5.47% dividend and they are merging with Direct TV who has the exclusive on the NFL Ticket TV programming. That should keep you out of trouble.

Good health and happy and safe travels to you,

Freewilly

"Sell in May and Go away. Some of the high flying stocks have already taken a good beat down and may present an entry point for a longer term investment. Egalet Corp.(EGLT), a young pharmaceutical company, which appears way oversold here, presents such an opportunity"

Dow Jones Industrial Average 18,080.14  (UP) Week ending 04/24/2015
Dow Jones Industrial Average 18,024.06  (Down) Week ending 05/01/2015

Legendary investor Warren Buffett advises to 'be fearful when others are greedy, and be greedy when others are fearful.' Well nothing strikes fear more with individual stock investors as knowing they are coming up on the dreaded month of May where the high roller investors tuck in their investments and head off to the Hampton's to start their summer vacationing. Some folks,, being clever knowing this is coming, will actually brilliantly start their May stock selling on April 15th after taxes are all wrapped up.

So by May 3rd, today, you can already find some good bargains to snap up for your portfolio going into next year. (You are not buying stocks to hold for 3 months and sell. That is not investing!)

"The secret to investing, just like the secret to comedy, is "Timing"" . To often us individual investors will have a great idea for buying a stock but will not wait to get it at a value price. What causes particular apprehension to us is that when a good stock goes down in price there is some associated short term dreadful news with it like " tattoos make the Apple I watch not work right", or a short term quarterly earnings miss because of the weather. 

One stock where the investors are well on their way to Cape May or Nantucket is

Egalet Corp.,(Symbol EGLT, $9.66)

This local company located near me in Wayne, PA. (near King of Prussia PA.) has had its stock price completely washed out in the last 2 months.

According to their website, "Egalet is a fully integrated specialty pharmaceutical company focused on developing effective medicines for patients with acute and chronic pain while helping to protect physicians, families, and communities from the burden of abuse."

The stock which has traded up to a high of $17.00, and currently has a target price of $18-$20 dollars, can be purchased right now for $9.66. Talk about being washed out.

This stock I would need to put in the "speculative" category because they currently have negative earnings, not unusual for a small young company. The company is very financially sound though with current assets of $55 million and current liabilities of only $7.4 million dollars. They also have some good people on board from the pain medicine industry. They are constantly upping their earnings on revision estimates, (so far to a lower loss), and they only have 17 Million shares outstanding.

Here is some good information from their website about their technology:

Egalet Guardian™ Technology

Abuse Deterrence Plus Precision Delivery

Egalet’s Guardian Technology was developed to provide peace of mind to physicians and patients by delivering commonly abused prescription medications in an abuse-deterrent form.

Abuse-Deterrent Features

Opioid analgesics developed using Guardian Technology are designed to deter common methods of abuse. Guardian Technology utilizes injection molding to create a hard matrix and shell that is designed to be difficult to crush, grind, chew, or dissolve and that turns to gel when exposed to water.

Precision Delivery

Guardian Technology is designed to deliver the active ingredient using a zero-order release profile (see Figure).1 This zero-order release profile is designed to deliver the active ingredient at a constant rate of release

Currently there are 4 Buy recommendations on the stock by wall street analysts. 43 Institutions own the stock and 77 Mutual funds, so you are not "out on a island" joining in and buying it.

I would be remiss if I did not mention the new album release from THE WATERBOYS called Modern Blues. I went to see them live at the Keswick Theatre locally and they put on an amazing  live concert. 

So I would buy the EGLT stock shares and The Waterboys CD or Vinyl album of Modern Blues and you will be very well invested.

Freewilly

"When the MASTER'S Golf Tournament arrives in April, I love to go back and watch the movie, "The Greatest Game Ever Played", that features young amateur golfer Francis Ouimet with his 10 year old caddy Eddie Lowery stunningly winning the 1913 US Golf Open. So what does this have to do with stocks?"

Dow Jones Industrial Average 18,058 (UP) Week ending 04-10-2015
Dow Jones Industrial Avergae 17,826.30 (Down) Week ending 04-17-2015

Each year in April when the Masters Golf Tournament in Augusta, GA. rolls around with all the great golfers coming in to make their play to win the coveted green jacket, it makes me want to re watch the golf movie, "The Greatest Game Ever Played. 

This movie is based on the 2002, Mark Frost biographical account of Francis Ouimet's 1913 U.S. Open victory titled, "The Greatest Game Ever Played: Harry Vardon, Francis Ouimet, and the Birth of Modern Golf."

The story is about a young caddy Francis Ouimet who decides that he is going to try out to play as an amateur in the 1913 US Golf open near Boston, Massachusetts. "When Francis was four years old, his family purchased a house on Clyde Street in Brookline, directly across from the 17th hole of  The Country Club. The Ouimet family grew up relatively poor and were near the bottom of the economic ladder, which was hardly the position of any American golfer at the time." (Sourced From Wikipedia) . He is pictured above in the movie with his unlikely 10 year old caddy, the spunky Eddie Lowery. True story.

 Harry Vardon, Francis Ouimet, Ted Ray

Well, I will let you watch the movie to see what happens, but I included a picture with Francis and his two top British professional golfer competitors, Harry Vardon and Ted Ray. These were all excellent golfers. Francis Ouimet remained an amateur and become a very successful  businessman.

So what does this have to do with stocks?? 

Well it turns out there was formed by a group of people a Francis Ouimet Caddy Scholarship Fund. 

Well there was this young caddy who applied for this scholarship and was awarded it to study at Boston College.  His name was Peter Lynch.

I was for some reason rereading Peter Lynch's "One Up On Wall Street" last night, and this information jumped off the page at me in stunning fashion. It was as if somebody had led me there to read it. 

His story was similar to story of Francis Ouimet, except for instead of winning the US Open his success was that be became the greatest mutual fund manager of all time, getting a job through his caddying with the Fidelity company in Boston and later running the Fidelity Magellan Fund from 1977-1990. 

The Fidelity Magellan Fund had a 2510% gain during his tenure as manager. That is the equivalent of golfing a 62 on each day of the golf tournament!! Talk about the butterfly effect!

So if you want to know what stocks might fit Peter Lynch's criteria today to invest in, you can go to WWW.NASDAQ.com and when you look up the symbol of a stock and enter it in, they have in the left-hand column a link called "Guru Analysis". At the top of the list is Peter Lynch's rating based on his criteria. Here are some examples of the stocks screened from Guru Analysis he would like right now:

91% Qualcomm Inc. (symbol QCOM, $67.15)
91% Apple Inc.          (symbol AAPL, $124.75)
91% Honeywell International  (symbol HON, $101.70)
91% Wells Fargo & Company (symbol WFC, $54.05)
91% Kansas City Southern   (symbol KSU, $104.49)
91% US Bancorp  (symbol USB, $42.44)

87% The Middleby Corp. (symbol MIDD, $102.60)
72% Constellation Brands (symbol STZ, $115.98)
72% Icon PLC   (symbol ICLR, $68.98)

So you can see now how Golf and Caddying have had a direct effect on the history of Wall Street investing. (P.S. little Eddie Lowery, the 10 year old caddy, went on to become a multi-millionaire businessman himself, so success all around.)

I would also recommend that you read Peter Lynch's books, "One Up on Wall Street" and also "Beating the Street".

He will tell you that you can be as good at investing as he is if you focus on what you know.

Have a great investment week,

Freewilly

"The endless quest for growth at a reasonable price brings me this week to a quality stock at a decent price. Keurig Green Mountain Inc. (Symbol GMCR)."

Dow Jones Industrial Average 17,690.41 (Down) Week ending 03-27-2015
Dow Jones Industrial Average 17,763.24  (Up) Week ending 04-03-2015

I can always look to the "Beverage" sector if I need to find some growth. I currently own Constellation Brands, (STZ), and have also owned Monster Beverage (MNST), and Boston Beer Company (SAM) and they have  done very well for me. 

So that led me to the single cup coffee, (and tea), company Keurig Green Mountain Inc. (Symbol GMCR, $114.31)  which seems to me to be trading at a slight discount right now and is down from it's high of $156.92.

GMCR has a PEG ratio of 1.71 and a Return on Equity of 17.10. I go into work and use one of these machines everyday and it works well, no wasted coffee.

Keurig Green Mountain had annual revenues in 2014 of $4.71 Billion dollars. The 3 year growth rate in revenues has run 11.43% and this was after one year where they had 50% plus revenue growth, so quite a run.

The company has just signed a partnership deal with privately held Reily Foods down in New Orleans with New England and French Market coffee and Luzianne Ice Tea pods.

A possible catalyst this week for the stock will be when Bed Beth and Beyond announces their earnings report and them discussing a new Keurig single serve Soda machine that they will be selling. (I guess that they are going after the market now held mostly by SodaStream.)

Zack's has a "Hold" rating on the stock and IBD has a earnings rating number of 70. The stock chart has been ugly recently.

Earnings for 2015 are projecting at $4.09 per share and for 2016 they are looking like $4.68.
Long term earnings growth for the company has been 16.25% and the 3 Year earnings growth has been 22.61%. The company operates at Gross Margins of 44.20%.

Financials are good here with the company having a Current Ratio of 2.80 which is excellent.

The company also pays out a dividend yield of 1% to cover your account expenses.

Insider buying is very favorable here and is running around a 5 to 3 ratio of buys to sells by insiders.

The stock has has been drifting down here so as usual I would say to buy 25 shares and see how it goes. If it goes lower add some more.

This is too good a company for this to keep moving down. Growth at a Reasonable price seems to be the key.

I hope you had a great  and wonderful Easter and Passover holiday. 

You can pretty much put anything in a K-Cup!  A simple and great concept. Buy GMCR.

Freewilly