"Well now that the turkey day, Thanksgiving, has passed and the Black Friday weekend is here, how are the stock prices of the retailers doing this year"

Dow Jones Industrial Average  11,232 (Down)  Week ending 11-25-2011

Well we celebrated the Thanksgiving holiday this week our traditional gathering to eat a sumptuous meal of Turkey here in the US.  It turned out that the week in the stock market also was a "turkey" as we had the worst Thanksgiving stock trading week since 1932. You will remember that year, " In 1932 the economy continued to deteriorate and unemployment increased further in 1932 to 24.1% , there were few jobs and many ordinary Americans were forced into living in the streets or in old cars. Towards the end of the year in November the American voter used the power of Democracy to show Herbert Hoover what they thought of his term of presidency during these bad times and voted strongly in favor of Franklin D Roosevelt by 472 electoral votes to 59. "   Sound familiar?  Maybe we will follow the lessons of history and make a change in our government and get things turned around.

I thought this week with the kickoff of Black Friday and the holiday shopping season that I would do something different and report just how some of the retail stocks are doing with their stock price year to date (YTD). I picked out a mix of stocks that I hear talked about often. I pulled my stats from the CNBC quote website.

Ulta Salon Cosmetics & Fragrance Inc.  (ULTA) -  +87.41%
lululemon athletica inc. (LULU) - +71.71%
Sally Beauty Supplies (SBH) - +41.22%
Express (EXPR) - +37.95%
Dollar Tree (DLTR) - +36.58%
Bed Bath and Beyond (BBBY) - +30.64%
Ross Stores (ROST) - +30.27%
TJX Cos. (TJX) - +26.37%
Costco -(COST) - +19.66%
Petsmart -(PETM) - +16.92%
CVS Caremark Corp. - +16.76%
Limited Brands (LTD) - +13.47%
Tiffany (TIF) - +13.32%
Foot Locker (FL) - +11.81%
Walmart (WMT) - +5.33%
Amazon (AMZN) - +2.90%
JC Penney (JCP) - (-9.78)%

One thing is apparent, you would have done pretty well buying most of the retail stocks on the list.  If you had bought a stock this year though like Best Buy you would have been down 41% so not all were winners. Surprisingly, Wal-Mart and Amazon not very high up on the list even with their high volume of sales. It appears that the 2011 holiday shopping season has been pretty good so far.

 If you are looking at the fundamentals of these companies just make sure that they do not have a large build up in inventories over multiple quarters. That is a Red flag that business is slowing up. I imagine that the best time to buy retail stocks would be now and then sell them into earnings in January.

I won't tell you which one to buy, but the one above seems to have a surplus of female customers that love their athletic clothing line.

Catch you next week,   Freewilly

Shhhhh! The fundamentals tell me that you should very quietly start buying the stock of Citigroup Inc."

Dow Jones Industrial Average 11,796  (Down) Week Ending 11/18/2011

Sometimes you are down so far that the only place to look is up. (picture left). There will continue to be rumblings and tumblings with the European countries and banking systems with the travails of the Euro. But one of these days, while the dust is settling, there will be a flight to safety to the recapitalized banks of the United States of America. And on that day, a company with one of the ugliest 5 year stock charts I have ever seen is going to start it's long ascent back up to prominence in the Dow.



5 Year chart of Citigroup (symbol C, NYSE)

 Citigroup Inc. (Symbol C, $26.28) has the fundamentals lining up to become a good one to three year investment. I know, you are thinking to yourself, what about the large overhang of the housing and mortgage market. The market will slowly digest it and the housing market will very slowly start to stabilize and turn around in the other direction. Inventories will eventually come down.

Citigroup has projected 2011 earnings per share of $4.08 and projected 2012 earnings per share of $4.45. 3rd quarter GAP earnings were up 75.71% this year's quarter over last year's quarter. Total Net Income continues to rise each quarter over the next. They are getting their fiscal house in order and it will be corrected over time.  Sales growth will be a rough road to hoe for a while with a company that has such large revenues to begin with.





Yes , you could play it safe in the treacherous waters of this market and buy a JP Morgan or Wells Fargo like some well noted investors have, and they are very good businesses, but their stocks are not trading at 49% off of their 52 week high price like Citi is here. This is a longer term trade that you will buy and put away awhile and check the price in about 6 months. The return will come over time, a rare thought in these markets.

Here is a New York Times link on the stock: http://topics.nytimes.com/top/news/business/companies/citigroup_inc/index.html

You may even save a few bucks if you buy it next week with Congress's "Super" Committee in deadlock and another possible US credit downgrade coming. Time for the US Govt. to finally get their financial house in order. 

Freewilly

"This Copper and Gold company is looking pretty inexpensive here. The stock? Freeport-McMoRan Copper & Gold Inc. (symbol FCX)"

Dow Jones Industrial Average 11,983   (Down) Week ending 11/03/2011



Mr. Dawes, Sr.: "When stand the banks of England,
England stands...when fall the banks of England, England falls!"

 A lesson from the movie Mary Poppins,  from so many years ago. Confidence. If little Michael doesn't save his tuppence at the bank, there will be foreclosures and business failures. When he decides that he wants to use his money to feed the birds instead , and wants to take it with him and the people hear that the bank won't give the money back, confidence is lost, panic ensues, and of course a run on the Dawes, Tomes, Mousely, Grubbs,  Fidelity Fiduciary Bank!

Confidence. The America’s Financial Industry Regulatory Authority gets a little twitchy and asked MF Global to post more capital to back up it's Euro-zone government bond exchange swaps with bets of 6 billion on Spain and Italy government bonds, which in normal times is a low risk exchange transaction. Then Moody's downgrades MF Global's credit rating and all the other firms lose confidence and stop trading with MF Global.

 On Halloween, Trick or Treat, MF Global says trick, and files for bankruptcy and has 700 million dollars of customer account money missing.  Jon Corzine, didn't you notice all those people outside your front window in the "Occupy Wall Street" protest that are there because of financial firms taking excessive risk with money?  I know you are a good guy, so I can only assume that you underestimated this new paradigm of risk that we live in today with the Euro-Zone troubles. I hope it somehow works out.

An Honorary Mention goes out also to Freddie Mac, who announced they lost billions and are asking for another 6 Billion from the government. (disgusted head shake here)  So let's talk now about making money instead of losing it.

Freeport-McMoRan Copper & Gold Inc. (Symbol FCX, $40.32).  With this stock you will see some common themes that I like. First, a 2.49% dividend for some income and to cut down on people shorting the stock. Second , the stock price is down from short term downturn in earnings , but earnings will increase going forward with a forward PE of 7.91. The company is projecting 2012 earnings of $.5.07 which is projected down from a few months ago when it was projected up near $5.57. I think we will have a rise in the price of copper and gold which will bring some of these earnings back in.

FCX has 5 year sales growth of 23.8%. Net profit margins have been 24.50%. The company has been running a return on equity of 38.90%.
To me , Copper is just plain cheap here at $3.56 per pound.


Gold has taken a little breather here, coming down from the $1950.00 and ounce level down to $1755.00 per ounce. This company gives you exposure to both metals. The company is also a Molybdenum mining company, if you have an affinity for that metal.

If you buy this stock you are with good institutional company.  State Street, The Vanguard Group and Blackrock each have 5% of their holdings in this stock. The financials of this company look very healthy to me.

I guess it wouldn't hurt us all to save a little more money and spend a little less. So, put some tuppence in the bank and restore a little confidence in our financial condition.

Freewilly

" Sometimes you just need to put a muscular and unbreakable stock on your team, so that you can sleep easier at night"

Dow Jones Industrial Average 12,231 (UP) Week ending 10/28/2011

I don't know if it is because it has been raining ice and snow all day and it has taken down some of my trees or if watching a rerun of "GI Jane" and watching the grueling training that the US Navy Seals go through, but it just put me in the mood to write about a stock that is "tough as nails", with numbers that just never quit. The nails analogy is good here, because this stock has just the tools to hammer in those nails. I am talking about the stock of  Stanley Black & Decker Inc. (Symbol SWK, $66.69).  

     The marriage of Stanley Tool Works and Black and Decker took a little while to get back in operational line, but they are in lock and load mode right now, unbreakable.  Last quarter proforma earnings were up 38% to start with. 2011 earnings ending in December is projected at $5.11 per share. Moving to 2012 , $5.91 per share. 5 year sales growth at this company is 17.55% with the 3 year total return of 116.5%. The stock had a dip down in 2008-2009 when the rest of the market took a tank and bottomed on March 5th, 2009, but from then on things have looked pretty good.


Demi Moore in GI Jane


P.S. after watching Demi Moore do push ups in the movie, I wouldn't go messin with her if you know what's good for you. SWK is up 9.56% year to date. The real tell on this stock is the 2.46% dividend of $1.64 a share. Stanley Black and Decker have raised the dividend in every year for the last 5 years. This is always a very good sign for any stock that you are investing in.

Something else you should know about this company is that they are benevolent. This press release just came out. JOPLIN, Mo., Oct 20, 2011 (BUSINESS WIRE) -- Stanley Black & Decker (NYSE: SWK) a Fortune 500 provider of hand tools, power tools and security solutions, today announced a $350,000 tool donation to the Joplin, Missouri, rebuilding efforts. Our friend and builder of our kitchen, Andy Doyle, just donated his time and went to Joplin and built a new wooden children's playground out there in Joplin. So good things can happen when corporations and individuals work together for a cause.

I must be old, because I remember Demi Moore as the girl with the raspy voice on the TV show "General Hospital"  that was on  in the afternoons. She does a good job in the movie GI Jane, if you get a chance to see it.

Have a good snowy end of October. November should be fun with the market moving up. I like some of the commodity stocks going forward with a hint of inflation showing up in interest rates.

Jacko-Lantern in snow - Deb Wilson


All the best ,    Freewilly

"Diversify your IRA or 401K by purchasing stock in dollar blocks of $1500-$2000 to keep things managable for you"

Dow Jones Industrial Average 11808.79 (UP) Week ending 10/21/2011

I am always looking for stock positions to diversify my IRA portfolio that tend to be broken down into blocks of $1500 to $2000 to form building blocks. So in a $10,000 portfolio you may have 4 or 5 stocks
that are Large cap or Mid cap , then maybe one or two stocks that are Small capitalization companies. So I am looking for good fundamental value as far as price to earnings and revenue growth and preferably a stock that I can buy a fair amount of shares of. In this current trading environment it does not hurt to have a dividend.

So what would I buy on Monday?  NOKIA Corp. ADR (Symbol NOK, $6.61) , (logo the work of Atakos.com , Design and Marketing blog)                                                                                        

You could buy 250 shares here for $1652.50. This would fill a large cap stock position in your portfolio. NOK pays a nice dividend yield of 7.26 percent. Revenues and earnings have been sickly here the last year because of a short term lack of competitive product to compete with the Apple I-phone and multi-platformed Google Android phone lines. However the word is that the Nokia smartphone with the new simplified Microsoft phone interface in it will be out for the Christmas sales season. I think this new simplified phone interface will be well accepted internationally. Remember, even in an off year,this company did over 58 billion in revenue.

Another stock I like right here is NVIDIA Corp. (Symbol NVDA, $14.48). You could buy 125 shares for $1810.00. NVDA has a long term growth rate of 16.91%. Earnings for 2012 looks like $1.00 per share and for 2013, $1.18 per share. The company's "best 3D technology for the PC just got better with the introduction of new NVIDIA(R)3D Vision(TM) products, which deliver greater realism and immersion than ever for 3D games, movies and photos".  The company pays no dividend but has the major plus in these leveraged times of having zero long term debt. Tech stocks as a sector seemed to be ready for some upside movement in this 4th quarter.


People tend to diversify by market sectors, but don't forget to also diversify with large cap, mid cap, small cap and international stocks.  

Have a good last trading week of October. Still have Halloween on the following Monday. Make sure you don't eat all the candy before the kids get there!

Freewilly

                                                                                                                                                                                                

"Occupy Wall Street? Heck for Twenty Six dollars and Fifty-Three Cents you can own Wall Street, with the shares of NYSE Euronext"

Dow Jones Industrial Average 11644.49  (Up) Week ending 10-14-2011

Everybody is mad at Wall Street. Citizens are mad at the banks that were too big to fail, and bankers that still got their fat bonus checks.Those banks took capital risk that they normally would not have taken, knowing they would be bailed out if they screwed up. And screw up big time they did! The banks along with Freddie Mac and Fannie Mae made high risk loans to people to buy houses who put very little money down and that they could not afford. Everybody was making money in real estate, and the activity drove home prices to speculative levels that could not be sustained. So now we are stuck with this wicked multi year financial hangover and lingering 9% unemployment.

So why not just own Wall Street and have them pay you? NYSE EURONEXT , (Symbol NYX, $26.53) stock gives you ownership in the New York Stock Exchange. First you start out with getting paid a 4.41% dividend. The stock trades at a meager value PE of 10.38. Average 5 year sales growth of 17.70% and earnings growth of 10% a year. You wrap all that together and you are bound to get a pretty good annual return. The stock was trading as high as $41.55 in May of this year, so you have plenty of headroom here.

You could also take your protest to other cities around the world because NYSE Euronext owns:    The New York Stock Exchange, Amsterdam Stock Exchange, Brussels Stock Exchange, Paris Bourse,  London (LIFFE) and the Lisbon Stock Exchange. You would have a lot of curbs to sit on and not get kicked off because you would be the owner!

 
So get your Protest groove on , and keep it peaceful, that's how Martin Luther King Jr. and Mohandas Karamchand Gandhi would have done it. The voice of the people. Let's get a job for everyone that wants one.

Freewilly

"Some ideas extracted from Investors Business Daily and some from Jim Cramer's Mad Money TV show"

Dow Jones Industrial Average 11103.12  (Down) Week ending 10-07-2011

Some times a small reward in your day can help you make it
through. Hershey Co Inc. (symbol HSY, $58.99) can deliver these chocolate treats and has been doing it for years. This tasty stock has a one year total return of 21.9% and a three year total return of 68.6%.  The stock pays a nice 2.34% dividend and has a staggering Return on Equity percentage of  67.00%. The IDB rating is 90-62-92. Earnings growth a little mild, but very consistent. 

Another stock that jumped out at me from IDB was not usually a stock that you would often talk about. STAMPS.COM (symbol STMP, $24.72) has a long term growth rate of 18%. Stamps has an IDB rating of 99-89-99 A+, B. , with 99 the highest rating you can get for growth. 12 month Total Return is 67.6% and the 3 year Total Return of 173.8%.   These are two stocks that I saw in Investors Business Daily that peaked my interest. They do an excellent job of extracting data and making it easy to see and understand.

Jim Cramer of CNBC , who went to the same high school as my wife Deborah here in Springfield (Montco) PA., works harder than anyone I know to bring you just tremendous investment ideas on his TV show Mad Money and on his websites. You will find his websites on the links on the right column of my blog. I was lucky enough to be watching when Jim brought on to his show the CEO of Whiting Petroleum Corp. (symbol WLL,$35.54) . This stock is flat out great value investment which is down this year. The CEO is committed to getting the stock price back up. Great fundamentals and  explosive earnings growth with 2011 earnings per share of $3.67 per share and 2012 earnings of $4.66. This company has 18, (count'em) , strong buy recommendations according to SmartMoney.

Jim , (pictured), a week later brought the CEO of Red Hat Inc. (symbol RHT,$42.88) on to his show and rolled out just another great company.
Long term growth 20.40%. 12 strong buy recommendations. The stock is only up 1.5% this year but the three year total return of 222.2%. We can live with that number!  This company helps companies save money. That is a winning concept all the time.

One  last recommendation from Jim is Big Blue,  International Business Machines Corp. (symbol IBM, 182.39).  Eleven strong buy recommendations.  The price might look high on a historical basis, but the company is projecting 2012 earnings of $14.75 per share. A three total return of 104%. Not too shabby!

 So it's OK to use the other guys recommendations when they are going to make you money. They have full research staffs to help them out and lots of eyes and ears out there to find those great ideas. Three bucks for an daily IDB and Jim Cramer gives you lots of free stuff and also offers professional services if you prefer their inside stuff and a timing advantage.

So hope for sunny fall skies and Dow 12,000. Have a good week.

Freewilly

"The continuing search for growth and fundamentals leads me to the doorsteps of Direc TV Group (symbol DTV)"

Dow Jones Industrial Average 11509.09 (Up) Week Ending 09-16-2011

Sorry I missed you last week. I was down at the Jersey Shore, at Charlies on Shore Road in Somers Point NJ,  eating  LISA's PASTA & CLAMS , chopped Clams & Tender Littlenecks sautéed in White Wine Garlic (or Marinara Sauce) over Capellini (Angel Hair).  Sometimes you just need to kick back and do that. Besides that, the market was at kind of Mexican standoff anyway. So this week I am back in sync with a very smart growth pick.

Direc TV Group ( Symbol DTV, $43.70) is up around 6% for the year, but was at a high price of $53.40 just back on July 13th this year. I see it going to a target price of $60.00, which would be a 37% gain from the current $43.70 price. The 2011 earnings per share are projected at $3.37 and the 2012 earnings are projecting at $4.23 per share. 5 year earnings growth has been running at 19.73% and is projected at 20.66% going forward from here.

The total return on the stock for the last 3 years is 66.9%. I'll take a 22% increase in the value of my stock per year anytime. The current PE is 13.56 , very reasonable. Subscriber growth slowed a little bit in August,
but going forward they should be just fine. Their $29.95 package offering with the addition of the NFL package is a very compelling offer for the 4th quarter and should take market share from Comcast and Verizon. I have Comcast and they are charging me $63.00 plus a month just for basic TV cable.??

So let's wrap it up with Direc TV as a winner for you. Mitch would say, "I wanted to order Direc TV, but the satellite dish would not fit in my suitcase when I traveled".

Freewilly

"You have been whipsawed by this market in the 3rd quarter, let the earnings fundamentals lead you forward"

Dow Jones Industrial Average 11,240 (Down)  Week ending September 2nd.


It is really quite simple. You need to own companies which have a strong demand for their products, regardless of what the stock market is doing. There is tremendous demand for Aircraft products right now.  Kaman Corp. ( Symbol KAMN, $31.59) makes aircraft specialty bearings and aircraft  components. Earnings per share will be going from $1.99 in 2011 to $2.42 in 2012. Where do you see a stock like this? Spend $5.00 on the latest copy of Barron's, and get a nice macro view of the market and earnings. We still need paper to give us a better view. It is easy to see.

The next three stocks have tremendous demand for their products and parts because of the exploding demand for Smart phones by the world. Two of them in particular are suppliers to the monster machine known as Apple.  Qualcomm Inc. (Symbol QCOM, $49.68) ,  CIRRUS LOGIC ( Symbol CRUS, $14.20) , and  Skyworks Solutions Inc. (SWKS, $19.62 ) are three stocks that should experience tremendous growth in the next few years from the growth of the smart phone market.
All three are projecting upside earnings growth that should bring their stock prices up.


Another area of growth with demand is the medical devices area. One name I like there since it has pulled back in price is ZOLL MEDICAL CORP (Symbol ZOLL $41.04) .  Again, tremendous upside earnings growth. We all need a defib after looking at our portfolio losses and this stock should be just the ticket.

 Another company with big time earnings growth is Paccar Inc. (PCAR, $35.67 ) growth theme in transportation parts and trucks. All these transportation vehicles whether it be planes, trucks, or automobiles,  are all old now and will need to be replaced soon creating demand.  

And one last one to mention that has a 6.77% dividend to go along with it is SEADRILL (Symbol SDRL, $31.90).   68% of the world is covered with water , and  Seadrill Limited, an offshore drilling contractor, provides drilling and well services to the oil and gas industries worldwide. The company also offers platform drilling, well intervention, and engineering services. They are experts in harsh environmental oil drilling.   

So that should give you something to work with. Happy Labor Day, do not do too much work today, you are supposed to be off. Have fun.

Freewilly

"A little arbitrage play for you with Motorola Mobility Holdings Inc. (MMI) where you end up with shares of Google"

Dow Jones Industrial Average 11,285  (Up) Week ending August 26th

Cape May & Atlantic Counties in NJ

It would have been convenient if they had put up a sign for us, in the middle of July, to tell us that there was a Cat 3 hurricane coming to the stock market to do massive damage to our portfolios. We have recovered a little, but there is a long way to go.  Now, after we also have weathered a rare East Coast 5.9 earthquake during the midweek, New York City is facing an actual real Hurricane coming, which could close the exchange on Monday due to flooding.

Hurricane Irene as you can see by the map is bearing down on The Big Apple. It would figure because we finally got a one day rally going on Friday. Hopefully it will all go well.                                   

One idea to try for when the market finally does open is to purchase the shares of Motorola Mobility Holdings Inc. (Symbol MMI, $37.72). This is one of those trades the Chairman, Mario Gabelli might put on.  The stock has been offered to be bought out by Google (Symbol GOOG) at $40.00 per share.  Many things could happen. At worse you get paid the $2.28 per share, 5.25% immediate return on your money and you end up with shares in the high flying Google. Kind of a running start. Or a second scenario, another suitor arrives on the scene and has a hankering for those Motorola stack of patents for the mobile world and the stock price gets bid up even further.

 Now you know while the chairman is always smiling. Only possible downside, if Google for some reason pulls their bid offer. This is low percentage but possible.

(It was at this point Saturday night that Hurricane Irene rolled in and rocked Eastern PA. and South Jersey and knocked downed trees and knocked out the electricity here for days and flooded our basement)

  ......... and because of that I will wrap this up because it is Saturday already, and I need to start the next blog.

Just a note: If I ever mention a stock that is under $5.00 in price, it is against my tenants in Blog number one (go back and check) to purchase it, so consider it a highly speculative investment.

In general, unless you are speculating, (i.e. willing to lose all your money), you should not purchase stocks under $5.00 in price.    

Best Regards,

Freewilly
 

"Just because the US government owns 26% of the stock, it doesn't mean that General Motors is a bad investment! In fact, it is a great buy here."

Dow Jones Industrial Average  10,818  (Down) Week ending 08-19-2011

Some people call it " GM - Government Motors" because the US government provided financing to General Motors (Symbol GM, $22.16) , to help it reorganize and is a holder of 26% of the shares of the stock. I guess the fear hangs out there that the government will liquidate in shares and bring the stock price down. They may as well hold on to the shares at this point. The book value on GM shares right now is $24.86 , higher than the trading price. Revenues through June 30th , 2011 are $112,449. Sales are increasing quarter over quarter for GM.

Earnings for the 2011 year ending December 31 are projected at $4.21 per share. For 2012 they are projecting $4.54 per share.  That is a forward PE of 4.88 for 2012 for a company which huge revenues and good earnings. Other typical industrial companies with this type of revenues and earnings trade in the 60-80 a share range! This stock is at $22.16. So what gives?  The share price is down 40% YTD.  Even a blind monkey throwing a dart could get this one right. This company has almost 33 Billion in cash and short term investments.  BUY GM,  with a capital B.

Some other names I like here are Union Pacific Corp. (Symbol UNP, $85.69). When all else fails you can always buy a railroad that runs east-west and transports coal for electricity. UNP has a one year earnings growth rate of over 20%.  Nothing but earnings upside surprises here. The stock is up 15% year to date.

Don't forget about Mastercard (Symbol MA, $300.16). It was one of my Top ten picks at the beginning of the year. Even after the large sell off we have had the stock is still up 45.45% Year to date. I like it and Warren Buffett likes it and owns it too.

I also started looking at the stocks related to real estate this week which I believe could provide some good value picks here. One stock that got my attention in that area is Annaly Capital Management (Symbol NLY, $17.79). This stock is showing  a 14.61% dividend right now and have decent earnings of $2.86 a share and a PE of 6. This is a "pay you while you wait" for the real estate market to make a slight turn. You will need to be patient with this one.                                                                                                                                                                 
Whatever you do, move slowly in smaller increments in whatever you purchase here, because it may be at an even better price next week.

If Chicken Little is right, and the "Sky is Falling", that will be a better strategy in the long run for you.

 Lets see if 10,800 on the Dow holds support here and turns around this week.

Freewilly