After seeing the interest in yesterday's Serious Money: Five stable stocks for troubled times, I decided to track the stocks on a quarterly basis to see how they hold up over time (otherwise, what would be the purpose of discussing them in the first place?).
I said that all five have shrewd, conservative management teams and have been in the right place, at the right time -- and prepared. The standard for comparison will be the Standard & Poors 500 Index which closed on June 30, 2008 at 1,280.00. Although my original story was published yesterday, I will be using the second quarter end point for my five stocks as well.
Six months of 2008 are now behind us and the stock market has not been a friendly place to most investors. Stability that was once found in household names that were industry giants is gone, and they have now been brought to their knees.
Many of them were the stocks we might have looked to in the past for stability, so you can be sure I put forward my five candidates with a little trepidation, but forward I go anyway. First a little review is in order.
Citigroup Inc. (NYSE: C) dropped from around $53 per share last year to around $30 in January and we can buy it today for around $17. Even at that price Goldman Sachs (NYSE: GS) has downgraded it to a sell and thinks there is more bad news to come. Citigroup was the largest bank in the world. Not any more.
General Motors (NYSE: GM) was the largest car maker in the world. That was before the stock tumbled from $43 to its current $11 range. A crushing blow to long time investors hoping that someone in the company could stop the ship from sinking.
Alkermes (NASDAQ: ALKS) is a biotechnology company that makes extended-release products for the treatment of chronic diseases. The firm developed and manufactures Vivitrol, a treatment for alcohol dependence that partner Cephalon (NASDAQ: CEPH) markets in the United States. It also makes Risperdal Consta, a long-acting version of Janssen's schizophrenia medication Risperdal. Alkermes' pipeline includes extended-release injectable, pulmonary and oral products for the treatment of central nervous system disorders, addiction and diabetes. Bristol-Myers Squibb (NYSE: BMY) and Johnson & Johnson (NYSE: JNJ) are competitors.
The firm pleased investors earlier in the week, when it expanded its stock repurchase program by $40 million. Management also guided FY09 EPS to 11-16 cents and FY09 revenues to $200-$225 million. Analysts had been looking for a 10 cent per share loss and $194.89 million. Fiscal year cash flow from operations was expected to total $25-$30 million, as compared to an original $1-$5 million estimate.
Stock Picks for Under $10 There are a lot of once-highflying stocks that have fallen below $10 and look like bargains ripe for the picking. See if CIT Group, Ford, Motorola, Tenet Healthcare, Dynegy and Interpublic. Stock Picks for Under $10 - CNBC 10 Worst Managed Companies in America With the trading year almost half over and results from the first quarter out, 24/7 Wall St. presents its latest installment of its Ten Worst Managed Companies In America list. They include Sun Microsystems, Sears, Boston Scientific, Starbucks, Sprint, Circuit City, Motorola, AMD, AIG and Pfizer. 24/7 Wall St.: The 24/7 Wall St. Ten Worst Managed Companies In America
Many of us would be happy to benefit from a quiet retirement without facing concerns of losing all of our hard earned money. Fortune 40 gives us a helping hand by suggesting some big names to invest in that could offer us the results that we are looking for.
One such company is Abbott Laboratories (NYSE: ABT), whose earnings surged 35% during its last quarter, helped by its famous anti-inflammatory drug Humira and HIV treatment Kaletra. Looking ahead to the company's performance, CEO Miles White is planing to keep his main attention on its medical devices unit which is seen as a key element against strong competition.
Fortune 40 also looks at beverage maker The Coca-Cola Company (NYSE: KO), which benefits from strong international gains able to beat recent weakness in U.S. In addition, it looks like the company's acquisition of Glacéau and its VitaminWater brand offer it a good support to outperform on the market.
"Our portfolio has been notably light on pharmaceuticals and consumer products; we're rectifying that by buying Johnson & Johnson (JNJ)," says Gregory Dorsey in Leeb's Income Performance Letter.
"Getting a handle on exactly what the 122 year-old company markets is no easy task, given the broad scope of its product line-up. And to say that J&J has been a resounding success on the corporate stage would be an understatement.
"Through its more than 250 operating businesses, the parent company lays claim to being, among other things: the world's premier consumer health company, the largest medical devices and diagnostics company, the third-largest biologics company and the sixth-largest pharmaceuticals company.
"While acquisitions have played an important role in making the company what it is today, J&J has also achieved these milestones through internal growth. It boasts 75 consecutive years of rising sales.
Alcoa Inc. (NYSE: AA) said its Australian operations declared force majeure under supply contracts because an explosion at a gas supplier slowed production. Alcoa said the disruption will likely lower second-quarter earnings by 2 cents to 3 cents a share. Also, JP Morgan downgraded Alcoa from Overweight to Neutral, saying the company will not be a takeover target.
Bloggers, investors and Apple Inc. (NASDAQ: AAPL) weren't just interested in the new 3G iPhone unveiled Monday. Many of them commented on the appearance of CEO Steve Jobs and voiced concerns for his health, saying he was gaunt-looking. While a spokeswoman said Jobs was hit with a common bug, many are worried since Jobs was diagnosed with a rare form of pancreatic cancer four years ago, for which he underwent surgery that Apple said was successful.
Caterpillar (NYSE: CAT) was awarded a $397.1 million contract from the U.S. Army for two types of dozers with armor kits. The contract has one five-year option. Work is expected to be completed by 2018. Caterpillar is also holding its annual meeting today.
Bankruptcy Odds Watch What are the odds that General Motors will have to file for bankruptcy by the end of the year? 30-in-1. What about American Airlines? 2-in-1. Check out 24/7 Wall Street's Bankruptcy Odds Watch on 10 popular companies and what the odds that Northwest, United Airlines, Wachovia, Ford Motor and more will file for bankruptcy. 24/7 Wall St.: The 24/7 Wall St. Bankruptcy Odds Watch
Small Companies, Big Brands Take a look at 10 overachievers that became breakthrough success stories. See how they made their products a household name. They include Ciao Bella, Clif Bar, John Fluevog Boots & Shoes, Pirate's Booty, The Republic of Tea and more. Small Companies, Big Brands - BusinessWeek
The day has finally come. June 9 is here and Apple (NASDAQ: AAPL)'s Steve Jobs is expected to announced a new 3G iPhone in his keynote speech during the annual developers conference in San Francisco. The features of a new iPhone have been the subject of much speculation, all to be settled today, one way or the other. A new business model is also expected with subsidies paid by wireless carriers.
Boeing Co (NYSE: BA) said on Monday its 787 Dreamliner would make its first flight in the fourth quarter of 2008, on schedule according to the revised timeline announced in April for the new aeroplane's launch. First deliveries of the plane were scheduled for the third quarter of 2009, also as previously stated.
American International Group Inc (NYSE: AIG)'s CEO, Martin Sullivan, is facing dissent from three large shareholders who together control 4%, as reported Sunday on The Wall Street Journal. They sent a letter to the board regarding management improvements.
Back in the heady dot-com days of 1999, any parent who didn't want to brave the holiday season parking lots knew what to do: Get online and buy those Christmas presents at eToys.com. Unlike Toys-R-Us, which had recently gone online itself, eToys seemed to know what it was doing. It offered a vast array of toys at reasonable prices, and it got them to you on time as promised.
But by March 2001, you were back to the Toys-R-Us option -- by then allied with Amazon.com, and doing online retailing the right way. In the end, eToys proved no more durable than the Furby -- much sought-after, priced up by speculators and hype, only to ultimately end up in the backyard, broken and ignored.
eToys went up fast and crashed hard, (not unlike a pogo stick), and in many ways it remains a textbook example of the excesses and "irrational exuberance" of the dot-com era.
"You can invest for all the right reasons and still get the wrong result," notes long-standing turnaround stock expert George Putnam, referring to the poor performance of the pharmaceutical sector in recent years.
Here, in his industry-leading The Turnaround Letter, he offers a fascinating review of 10 leading drug stocks which he now believes offer a combination of growth potential at "pretty cheap" valuations. Here is his overview.
"In 2000 and 2001, when the Internet boom was becoming a bust, many smart investors turned away from technology stocks and put their money into drug stocks. How could you go wrong with the big pharmaceutical companies?
"Demand for their products was growing as the population aged. These companies had huge research and development programs that seemed to keep cranking out new blockbuster drugs. And most of them had great balance sheets, with many paying handsome dividends.
"Much of this reasoning has been borne out in the intervening years. Many large drug manufacturers have rung up substantial revenue gains over the last decade. So what's happened to the big drug stocks? With few exceptions they have gone sideways or down – in some cases down a lot.
5-Star Stocks in Warren Buffett's Portfolio Morningstar examines the most watched portfolio in the world -- Berkshire Hathaway's. Among the five-star stocks in the Oracle of Omaha's portfolio are Amercian Express, CarMax, J&J, Lowe's, UPS, Wellpoint and Kraft Foods. 5-Star Stocks in the Berkshire Hathaway Portfolio - Morningstar Secret Ways to Boost Your Social Security These four strategies can add as much as $12,000 a year to your retirement income. Secret Ways to Boost Your Social Security - Kiplinger.com
Integra LifeSciences Holdings (NASDAQ: IART) is a regenerative medicine specialist. The firm develops, manufactures and markets surgical implants and medical instruments that are used in neurosurgery, extremity reconstruction, orthopedics and general surgery. Its biological implants, grafts, and wound dressings are based on a proprietary collagen matrix that becomes part of a patient's body and help it to generate new bone and tissue to replace damaged areas. The company's surgical instruments include ultrasonic surgical ablation systems and joint fixation devices used in neurosurgery and joint reconstruction. Integra has key strategic alliances with Johnson & Johnson (NYSE: JNJ), Wyeth (NYSE: WYE) and Zimmer Holdings (NYSE: ZHM).
The firm pleased investors last week, when it reported fiscal Q4 EPS of 54 cents and revenues of $157.65 million. Analysts had been looking for 49 cents and $153.41 million. Management also guided Q1 EPS to 39-42 cents (40 cent consensus), Q1 revenues to $155 million or more ($151.1M consensus), Q2 EPS to 45-48 cents (45 cent consensus), Q2 revenues to $159-$164 million ($160.10M consensus) and FY08 EPS to $2.00-$2.15 ($2.04 consensus).
Medtronic (NYSE: MDT) is a medical technology company, specializing in a variety of implantable biomedical devices. Leading products include pacemakers, stents, catheters, glucose monitoring systems and insulin pumps. The firm's Cardiac Surgery segment offers products for the repair and replacement of heart valves, surgical accessories, and surgical ablation products. A Physio-Control unit provides external defibrillation and emergency response systems. Medtronic sells its products to hospitals, clinics, third party healthcare providers and governmental healthcare programs. Boston Scientific (NYSE: BSX) and Johnson & Johnson (NYSE: JNJ) are major competitors.
Investors were pleased last week, when Medtronic announced fiscal Q4 EPS of 78 cents and revenues of $3.86 billion. Analysts had been expecting 72 cents and $3.72 billion. Management also guided FY09 EPS to $2.94-$3.02 ($2.96 consensus) and FY09 revenues to $15-$15.5 billion ($15.14 consensus). UBS subsequently reiterated its "buy" rating on the shares.
After seeing the interest in yesterday's Serious Money: Five stable stocks for troubled times, I decided to track the stocks on a quarterly basis to see how they hold up over time (otherwise, what would be the purpose of discussing them in the first place?).
Six months of 2008 are now behind us and the stock market has not been a friendly place to most investors. Stability that was once found in household names that were industry giants is gone, and they have now been brought to their knees. 
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Many of us would be happy to benefit from a quiet retirement without facing concerns of losing all of our hard earned money. Fortune 40 gives us a helping hand by 
This post is part of a series on some of the most memorable 
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