serious money posts
Over the years I have referred to "my pal Warren" (Warren Buffet) on many occasions. He has taught me a great deal. I have learned a few things from Sir John Templeton (RIP) as well. But when I think about the price-to-earnings-to-growth (PEG) ratios, it is Peter Lynch who stands tall.
Lynch has been retired for many years and has been generous enough to share some of his thoughts in a couple of worthy books: One Up on Wall Street and Beating the Street. I highly recommend these best sellers to anyone that wants to expand their knowledge of value investing or manage their own finances.
Continue reading Serious Money: Buying the Super Caps, Part 3
In my search for value investments among the top twelve stocks by capitalization -- the "super caps" -- I began by reviewing the price-to-earnings and price-to-sales ratios. Today we will move on to examine price-to-book (P/B) and price-to-cash flow (P/CF).
If you are one of the lucky ones that benefited from the market's long rise from the depths of Hades and are now looking to rotate into less volatile positions, or you still remain apprehensive and want to stake out a new position, some of these super caps may be just for you.
Continue reading Serious Money: Buying the Super Caps, Part 2
Since early last fall, the majority of pundits have been saying that there would be a rotation from small cap stocks to the safety of large cap stocks in the new year. So far, the small cap stocks have maintained the lead, but a shift is taking place and the longer the bull runs and the worse global news becomes, the more this is likely to continue.
I have decided to examine the largest of the large cap stocks; lets call them the "super" caps; the top twelve as of May 13, 2010. Over the course of this series, the order will change and the bottom few may fade in and out as the market activity dictates. I may update the order, but for simplicity's sake will not change the stocks from the current list.
Continue reading Serious Money: Buying the Super Caps
It is an unfortunate thing that we live in a world where you are guilty until proven innocent in far too many cases. This is the burden that Goldman Sachs (GS
) faces as it has been convicted in the court of public opinion. Not only has it been convicted, but the public does not actually care whether it is guilty or not. The public feels Goldman has done the nation wrong and must pay.
On Tuesday, Lloyd Blankfein, CEO of Goldman Sachs, is testifying in front of the Senate Permanent Subcommittee on Investigations
. He will try to put his best foot forward, and hopefully it will not end up in his mouth. Blankfein may be top dog at the company, but he would do himself a big favor if he stays cool, calm and collected -- and maybe before the day is up someone will throw him a bone.
The public may want Goldman Sachs to pay, but how much should you pay for the stock under these circumstances?
Continue reading Serious Money: Goldman Sachs Shares Dirt Cheap
My, my, what a tangled web we weave, when first we practice...
It seems Goldman Sachs Group (GS
), now charged with fraud
by the Security and Exchange Commission, was doing more than practicing. Apparently its business practices leave much in question about its ethical practices and how far it would go to make a deal. In particular, failing to disclose what the SEC deems material facts that may have altered an investor's decision to buy a collateral debt obligations in the form of a Residential Mortgage Backed Security (RMBS).
One might think an experienced investor would have been suspicious from the onset about any security that actually included the letters "BS" in its title and that this would have been adequate disclosure.
Continue reading Serious Money: Goldman Sachs Is All the Rage
To those taking time off for Good Friday: "May the Force Be with You!" To those working half days, enjoy your time with your families. The U.S. stock markets are closed today and that might be best so that we all can take a breather.
Given that stock markets all around the world were up yesterday, including ours -- again ... April Fool's Day! -- even day traders expressed confidence because they obviously were willing to hold stocks knowing the long weekend left plenty of time for unforeseen bad news to to slam their positions.
Continue reading Serious Money: Dow Top Ten -- If Only the Market Was Open
It was only a matter of time before Intuitive Surgical (ISRG
) surpassed it's previous all time high of $359.59 set on December 14, 2007. I have blogged many times about ISRG in my Chasing Value column. Today, I'm delighted that the stock is rising, but I think it is getting a bit rich and the value proposition has changed -- intra-day it hit $366.50.
Intuitive has a trailing P/E ratio of 61 and a projected P/E of 46. I commonly average the two for such volatile stocks which translates to 53.5. There are certain times when that might be alright, but with a PEG ratio (price-to-earnings-to-growth) of 2.05, this is not one of them. If you own it I am not suggesting selling it, but if you do not it might be wiser to put it on your watch list and wait for the market to calm down.
Continue reading Serious Money: Intuitive Surgical Hits New Highs
We frequently receive comments that the market is overpriced. Recently one of our active readers commented that the market P/E was 30, which it's not. The actual rate (S&P forecast) has been even higher at times
due to the volatile market.
The average should trend closer to the long term P/E of 15.7 in the next few years. However, I have reviewed companies often covered on our site and come up with a list of 35 stocks that have price-to-earning ratios below the long-term average already. I think there are dozens of bargains regardless of the status of the overall market.
Continue reading Serious Money: Market Looks Cheap to Me -- 35 Stocks
Best wishes to all and, next to world peace among people, we should hope for the same among world markets.
I have let some time pass before commenting on a recent example of how fragile a world we live in. This past year through a time of greater economic danger, fear and volatility than most of us has experienced in a life time, many people cannot fathom how close we came to the edge of Hades.
Continue reading Serious Money: Dubai Vaporizes $48 Trillion
After reading an unbelievable sell recommendation by one of my BloggingStocks colleagues, I didn't know whether to laugh or cry. In Thirteen Dow stocks that are doomed, we are informed that 13 of the 30 are going down and we should all bail out before it is too late.
I find this silly on many levels. For one, 13 stocks amount to a large-cap index fund and since large-cap stocks have lagged the market the probability that they will outperform going forward is real and has many investors promoting them.
Continue reading Serious Money: These Dow Dogs are not -- AA, T, BAC, BA ...
If you're into Apple (AAPL
) or gold for the long term and you have been in for a long time you can stay put. If you are in them to make a quick buck, get out quickly!
Apple and gold are at all time highs. Yes, they may go higher, but not much and not soon.
The reason is that both Apple and gold (and probably golden apples) already include all the product info and inflation fears that could be. The next level is pure speculation. Do you want to speculate or invest? If the latter, invest elsewhere.
Continue reading Serious Money: Sell Apple, sell gold!
< Previous Page | Next Page >