There have been many lessons to learn from the "Great Recession." But while the message is often clear, we can't always muster the courage, discipline or consensus to act on these lessons.
The National Basketball Association (NBA) is about to enter its second season -- the playoffs. And for a Laker fan in Los Angeles, there is much to look forward to. However, the current NBA collective bargaining agreement will end and we will have to witness another battle between the billionaires and the millionaires.
Why can't the NBA learn from other businesses that have successfully maneuvered through economic turmoil to achieve profitability?
Continue reading Chasing Value: The NBA Should Learn from Others
The debate continues about whether SiriusXM (SIR
I) satellite radio will be dominant, dominated or dismissed.
A few years ago, in 2007, prior to the economic meltdown, Sirius was having a meltdown of its very own. Trading between $6 and $8 a share for most of 2005, it slid from $6 a share to $4 a share in 2006. By 2007 it was trading in a much tighter range between 3.50 - $4.00 and there were those that thought it might be a good buying opportunity.
This question was posed to me by friends that owned the stock and were considering buying more. I suggested they run. History shows that to be a good call. However, many investors, or at least traders that follow the stock made good money after the collapse picking up shares for pennies. I was not one of them, so props to those that jumped in -- I was making similar moves elsewhere.
Continue reading Chasing Value: Some Very Sirius Numbers
I was a bit amused to hear Omaha Mayor Suttle unrolled the idea of a toilet paper tax, but I am not so sure he really thought this tissue through. At first glance, the tax of 10 cents per roll to pay for sewer projects seems like a fair user tax; but I think the politicians really should have contemplated this a little more. Is it really fair to women?
While certainly my heart goes out to politicians trying to balance spending all that money without the pesky things called taxes; but I don't think this idea is going to ... float. But I think it is important to give the politician partial credit for productivity; as I imagine they thought up this idea while in the john.
Continue reading A Toilet Paper Tax -- Really?
In considering my 2011 picks
I took a look at Boeing Co (BA
), interested by the story. There are many ways for this company's future to play out in a very positive scenario.
The airline industry has been rejuvenated as of late -- and that is good news for aircraft manufacturers. The Republicans won the house majority and that usually improves the fortunes of defense contractors.
The 787 Dreamliner, now three years and counting behind schedule, is in test flight mode. The plane portrayed as a dream to travelers and airline companies has turned into a nightmare of sorts, or at least the dream has changed. Boeing is dreaming of the day they start manufacturing and selling and profiting from all their labor.
Continue reading Chasing Value: Looked at Boeing, Then Looked Away
Venezuela is broken and Libya is on fire. The Chavez government is incompetent and the Gaddafi regime may be just days away from collapse
as chaos fills the streets. Rumors of Gaddafi escaping to Venezuela are unfounded. However, if two men ever deserved each other, these two fit the bill.
Chavez, in all his economic wisdom has brought on over 28% inflation and counting in addition to the Currency Market Takeover Spurs Lines for Dollars
. All this wonderful news led me to search for Venezuelan ADR's (American Depository Receipts) in case I wanted to follow the market there, and make a contrarian play, or if I really wanted to get wild short something.
Continue reading Serious Money: Chavez & Gaddafi, Real Blues Brothers
Forgive me but I am still fuming about what is going on in Washington with our money. Money that is disappearing faster and faster. No matter how much our representatives cut taxes and extend benefits, it is meaningless. What is the good of having twice as much money when it is worth only half.
Welcome to Washington D.C. -- home of the Great Pretenders.
We just think that our Capitol sits atop solid ground. I think if you swept away the top soil you would find a giant cardboard box because our leaders are certainly playing the biggest game of three-card Monte of all time.
Continue reading Chasing Value: Is Congress Indirectly Helping International Paper?
This is my 1200th post. If someone would have told me I could write that much in my "spare time" I probably would not have stopped laughing until I collapsed. I marvel at all that has happened in the marketplace over this time: the ups and downs, good calls and bad; and being called everything under the sun, and then some, by our more 'enthusiastic' readers.
I must thank Amey Stone who I have been corresponding with for over a decade and was the one that first asked this architect and investor to be one of the initial group of bloggers. Now there is an army of writers and a lot has changed. For me this week marks a big change because Amey accepted a new position at another company and last Friday was her last day. Best of luck Amey!
Continue reading Chasing Value: Looking at Microsoft 1,200 Posts Later
A day does not pass that I do not think of John Maynard Keynes saying, "The market can remain irrational longer than you can remain solvent."
Two weeks have passed since I raised questions about the insider selling at Oracle (ORCL). Since that time, management continues to sell as the stock hovers around its 52-week high, and it has appeared in the top five of Barron's insider activity list sell side for both weeks. Add to this the concerns raised about Oracle's potential weakness in the world of cloud computing and there are major question marks looming.
Continue reading Chasing Value: Confusing Signals from BAC, LINN, ORCL
In recent discussions with some friends, one had bought Anglo American ADR (AAUKY
) when I recommended it years ago, and the other thinking about what the current opportunity might be. It seemed time for an update.
I'm into Anglo for $9.80 a share and a spot check has it trading at $23.00 per share in morning trading; a nice 135% return. It was much easier to recommend the stock before. Now that AAUKY is hovering around it's 52-week high of $23.55, it's a tough call. It certainly is not a value play now.
Continue reading Chasing Value: Anglo American, Gold or Something Else
For the past few days I have been writing about Apple Inc. (AAPL
) and what it might do with its growing pile of cash, promoting a dividend rather than any misadventures or allowing the cash to continue to drag down earnings per share.
This is not Apple's plan and many readers agree. They believe Steve Jobs and company know what's best about everything and have done fine by them -- the latter part is certainly true.
Today I put it to our readers to check current sentiment.
Continue reading Chasing Value: Questions About Apple?
Each day that passed in the third quarter added about $22 million to the Apple Inc. (AAPL) cash stash. Ironically we are 22 days into the fourth quarter. That means Apple has added in the neighborhood of $484 million more to what is an ever increasing percentage of the company.
The company's capitalization stands $282 billion.The cash is a drag on earnings. At the end of Q3 it equaled almost 18% of the value of the company. Considering it is the second largest company behind Exxon Mobil (XOM), for now, the bigger it gets, the more it resembles an anchor and not a safety net.
Continue reading Chasing Value: Apple $50 Billion + $484 Million
Steve Jobs, the illustrious CEO and the heart and soul of Apple Inc. (AAPL
) would have you believe that Apple cannot issue a dividend to shareholders because of the scary competitive business environment. He conveys to us that they need the money to overcome hardship and if the right opportunity comes along make key acquisitions.
This is utter nonsense, a supreme untruth, wasted breadth and a failure to come to grips with reality. In the past quarter Apple increased its cash and short term investments to $50 billion as I wrote it would
six weeks ago.
Apple currently has 914 million outstanding shares. With the stock trading around $300 per share, a 2% dividend yield would require $6 per share or, $5.5 billion dollars annually to cover the distribution.
Continue reading Chasing Value: Apple Does Not Need $50 Billion
Every time a CEO utters the word challenging you can hear the stampede of investors to the exit. You would think that corporate management would have learned to use some other word to describe the the times ahead.
Many a CEO has unwittingly cost his company billions in stock value while speaking at an earnings conference by stating that the business outlook was going to be challenging. If they put the word very in front of the word challenging, then still more value will be lost, at least in the short run.
Continue reading Chasing Value: 'Challenging' Is Expensive
If the reigning NBA Most Valuable Player, LeBron James, was a stock, would you find it was of any value as an investment? From my perspective, it would not be, unless Mr. James were to make some key moves off the court to mirror his talent on the court. The first thing I would tell him is to SHUT UP!
He needs to recognize that it is only natural for people in Cleveland to feel betrayed after years of support and adulation ended in a sputter, with nothing to fill the void. It is only natural for them to feel even worse after the self-serving arrogant way they were informed during a totally over-the-top television special.
Continue reading Sunday Funnies: Would You Invest in LeBron James?
What does it mean when a stock is downgraded to "Outperform" from "Strong Buy" as Raymond James did
this week? That was the analysis painted on Noble Corp. (NE
) and it's hard to figure.
What is the difference? What are they telling investors? You should switch from betting the farm to only betting the house on this stock?
They reduced their price target to $41 from $44. Noble closed yesterday at $34.66, so Raymond James is still speculating on a gain over 20% in the next twelve months.
Continue reading Chasing Value: Noble Corp.'s Meaningless Downgrade
Next Page »