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buffalonate (75.54)

May 2011



What Will Power The Future?

May 26, 2011 – Comments (9)

People on here keep trying to argue that solar and wind must be the power of the future.  The problem with this argument is that energy experts and power utility ceo's know that this cannot be because they are not reliable.  When the wind is blowing and the sun is out they are economically competitive with other forms of power but for them to be used on a wider scale there must be a way to store the power.  There isn't currently an economical way to store the power.  There are multiple new battery technologies available but if they were used the cost would double the cost of solar and wind.  This fact makes them more of a novelty than anything.  If you use wind and solar you must have some type of backup power plant waiting to come online if solar and wind power should die down.  Offshore wind turbines in the ocean or in the great lakes are economically viable because the wind is much more powerful and consistent.  The problem with this is it messes up the view for rich people and they have a lot of money to sue and delay projects for seven years(see Cape Cod offshore project).    [more]



Is Cliffs Natural Resources a Bargain?

May 25, 2011 – Comments (3) | RELATED TICKERS: CLF

I have been searching lately for sectors that are still deeply depressed because I like value plays.  I usually don't touch large cap stocks but sometimes the value is too hard to ignore.  I was looking into Nucor because I heard that steel production was down significantly from what it was a few years so I thought it would probably be a bargain longterm.  While doing so I stumbled into Cliffs Natural Resources.  It has a p/e of 8.7 and the analysts all have it listed as a buy.  The analysts have longterm earnings growth for this company going forward at 27%.  I thought this had to be a mistake so I checked a different site and got the same number.  I think it is logical to have longterm growth like that because they will be supplying iron ore pellets to an improving U.S. economy and the emerging economies will continue to modernize.  It appears to be ridiculously cheap with a longterm growth rate of 27% and a p/e of 8.7.  Am I missing something?    [more]



Any Oil Shale Experts On Here?

May 24, 2011 – Comments (20) | RELATED TICKERS: CLR , WLL , EOG

Oil experts predict that within 10 years U.S. oil production will increase 40% due to hydraulic fracturing in the oil shale.  I have been buying the Bakken stocks every time oil prices crash and this has been very profitable for me to play the technicals but I was wondering about the longterm production.  I manage about 500K for my parents and I am considering a longterm investment of about 50K into the Bakken and Niobrara stocks for them.  I believe this is a great investment for the next 10 years but how long will the oil shale plays last?  I am trying to put them in stocks they won't need to trade for 15 years or so.  I believe these companies will eventually run out of oil to drill and will revert to natural gas drillers.  Any help would be appreciated.       [more]



The Fastest Growing Small Retail Chains

May 18, 2011 – Comments (10) | RELATED TICKERS: CMG , BWLD , ULTA

I read Peter Lynch's One Up on Wallstreet several years ago and started looking for the highly successful regional chains that he was a fan of investing in.  He believed that small successful chains had a proven blueprint for success and would grow earnings much faster than the larger chains because they had more room to expand.  He also believed that the correct way to value a stock was that the p/e ratio should equal the earnings growth rate.  I invested in 3 at the time that I thought fit the profitle and they were Buffalo Wild Wings, Joseph S Bank, and First Cash Financial Services.  I am up over 140% on all three of them since then.  Since this strategy was so successful for me I recently started looking for more chains to invest in.  I am also going to show the percentage that their earnings have grown from 2006 to 2010.  Here is what I found.    [more]



Ameriprise Financial Is A Scam!

May 15, 2011 – Comments (12)

My mom recently asked me to have a look at her investments and tell me what I thought.  I have a TD Ameritrade account so I looked at the Morningstar ratings for her mutual funds and every one had a ranking of 2.  Basically they were charging her relatively high fees for very mediocre performance.  For example, they were charging her over 1% to be in an index fund when most index funds charge .1%.  I also noticed that every one of her investments was in Columbia or Riversource mutual funds.  I looked into it and found that Ameriprise Financial owns Columbia and Riversource Mutual Funds.  So basically all Ameriprise Financial Advisors just funnel your money into their crappy mutual funds and charge you big fees for their service.  Their financial advisors don't care about your financial well-being.  They just push you into the company mutual funds so they get their cut.  I told my mom that she would most likely be a millionaire by now if she had just invested her money in index funds instead of putting her money with Ameriprise.  If you know anyone who has money with Ameriprise please tell them about their conflict of interest and advise them to take their money elsewhere.     [more]



Your Best Small and Midcap Stock Ideas?

May 14, 2011 – Comments (13)

I am looking for new ideas for stocks to put in my watchlist.  I am looking for companies that have big potential and I am not worried about their current valuation.  In the restaurant field I like Chipotle Mexigan Grill and Buffalo Wild Wings and PF Chang's China Bistro.  In retail I like Fossil and Joseph S Bank.  In technology I like the 3D printing industry with TDSC and SSYS.  I also am a big fan of the laser industry with IIVI, RSTI, IPGP, NEWP, and COHR.  Faro Technologies, Clean Energy Fuels, Tower Group Insurance and First Cash Financial are also on my list.  A123 systems makes lithium ion batteries and that has huge potential in the long run.  They are the technology leader in this field and they just got a new patent approved for a better technology. Any of the Bakken oil shale companies are on my list including OAS, CLR, WLL, EOG, SSN, KOG, and NOG.  If you have any great ideas I would love to hear from you(ALSTRY not included).   [more]



Federal Tax Revenues Rise 18%

May 13, 2011 – Comments (14)

I believe the federal deficit will significantly decrease within the next calendar year.  For the month of April the deficit was half of what it was last year.  Tax revenues are up significantly.   We are removing troops from Iraq and pulling many troops out of Afghanistan which will save us around 100 billion a year.  The 2012 budget will also make serious cuts to the deficit.  These three things combined will create huge decreases in the deficit in 2012.  This will push the value of the dollar up and kill the bubble in gold and silver.    [more]



Great Time to Buy Bakken Stocks

May 12, 2011 – Comments (3) | RELATED TICKERS: BEXP.DL , OAS , CLR

It think the oil exploration companies in the Bakken shale are great companies that are sitting on billions worth of oil.  I think they are a great investment for playing technicals or for holding longterm.  With oil falling another $2 this morning I think it is a great time to get back into them on the cheap.  These companies include EOG, CLR, OAS, BEXP, WLL, and I believe KOG and NOG also own property in the Bakken but I am less familiar with them.  I think the volatility in this sector makes them perfect technical plays.    [more]



Why Banks Are A Buy

May 05, 2011 – Comments (0)

The best way to determine the health of banks is through their tier 1 credit ratio.  This number has been rising across the board for banks the last few months.  The American Bankers Association recently announced that loan defaults are down across all 8 categories.  Every large bank was profitable in the last quarter.  I recently bought stock in many large banks because they were at technicals lows for the month and the fundamentals were improving.    [more]



How to Bet on The Dollar?

May 05, 2011 – Comments (4)

I think our deficit will get under control in the coming year.  Tax revenues are up 10% according to state governments.  We are getting out of Iraq and moving significant amounts of troops out of afghanistan which should save us around 100 billion a year. In the last 7 months the economy has gained 1.2 million tax paying jobs.  The 2012 budget will also make significant cuts in the deficit.  For these reasons I would like to make a bet that the dollar will rebound.  I have never invested in currencies so does anyone have any ideas on the best way to do that?  Thanks  [more]



Leveraged ETFs

May 03, 2011 – Comments (0)

I recently wrote a blog last week stating that the market was due for a pullback due to inflation, high oil prices, gdp growth slowing down, and a 4% rise in the dow in 1 month.  I argued that the market is 10% off of its historical high and with gas prices hurting margins and the unemployment rate at 8.8% that a pullback was virtually certain.  I said that I was going to invest money in 3x leveraged bear etf's in anticipation of a pullback or at least enough volatility to make money.  People said you can't time the markets and that these leveraged etfs are guaranteed to lose you money.  I would argue that if you pay close attention to the technicals that leveraged etfs can be very profitable.  I invested in a 3x qqq bear etf(sqqq) and a 3x smallcap bear etf(tza) last week.  I felt so confident the market would pull back enough to make these bets profitable that I even put my mom's money in them.  The market pulled back today and we made a 6% and 8% profit respectively in less than a week.  I also recently put money in a regional bank ultra etf(kru) and a financial 3x bull etf(fas) because both were at technical lows for the month and I am a long on the financial sector.  I sold both of them yesterday for a 6% and 12% gain in less than 2 weeks.  I don't recommend investing more than 10% of your money in leveraged etfs because there is definitely risk involved but if the fundamentals and technicals are good you can make some very easy money playing the volatility.  If you are a novice investor you should stay far away from anything leveraged.      [more]

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