Varchild vs. Credit Suisse? Not hardly.... I completely agree with Credit Suisse.
If FORD held the same growth pace for the rest of this year as they have shown in the past 4 quarters....we would have a growth pace of performing 160+% better in EPS than 2009.
Looking at Q3 & Q4.... Ford would have to pull off an EPS 160% better than .26 in Q3 or
67 cents a share in Q3 2010.
Does that even sound remotely possible?
Of course not! One doesn't even have to bring up Ford Credit or Materials Costs or increased hiring leading to greater labor costs or UAW battles/fights or lawsuits or whatever that impacts earnings.....recalls.......etc.
I seriously don't think FORD investors have ever expected anything out of FORD other than solid market share gains leading to a much higher market share that will of course stabalize at some point.
Fast growth hits a levelling off period all the time. And is that a bad thing? Is it bad for APPLE's iPhone to one day have a 50% Market Share and then the growth stops but the Market Share stays at 50%?
Is that bad? ? ? If you think so then you are wrong.... Market Share or Growth Stabalization doesn't mean Sales are flat...
Sales can skyrocket for APPLE's iPhone and yet market share stays the same cause other cell phone competitors had similar sales growth. Nonetheless...Apple enjoys bigger profits.
Bottom line.... Don't let things like Credit Suisse Analysts declaring FORD an underperformer discourage you from your holdings... FORD is still a "HOLD" and that is where Standard and Poors has FORD...a 'HOLD.'
Varchild never said, "I am selling FORD as soon as Market Share stops getting bigger."
I only said that if Market Share starts SLIPPING....FALLING.....then I'll be deeply concerned.
Market Share stabalizing is actually what I fully expect 2nd half of 2010. [more]
hmm....scary stuff... I don't want to believe this is just a minor nosedive in the stock market and everything will be better tomorrow like I have with all previous declines..
My inclination is to believe right now that we may be slipping into a "Double Dip Recession" starting NOW! That's what I believe after reading articles and articles on the situation.
But I am not going to write up a PANIC PANIC PANIC BLOOD IN THE STREETS article to add to perhaps anyone else trying to cause panic... [more]
Thanks mostly to FORD for FORD's success.... Guess what I just read today?
Ford Motor Company adds 13 companys to its list of Key Suppliers.
hmm...When your cars are built with more technology than ever before and production + sales are up then likewise....you'll need more suppliers and technological expertise to support all of that.
This ladies and gentleman... is why I have to point out that perhaps the best performing sector since the market bottomed in march is the automotive sector!
You have GOODYEAR that skyrocketed in 2009....
You have Auto Parts Suppliers like AMERICAN AXLE that took off like a rocket.
FORD was THE best performing large cap in 2009.....
Harley Davidson is skyrocketing
TATA MOTORS ? Up Up and Awaaaaaaaaay!!!!
The list goes on.... Sure many other sectors have seen stocks go up big like the Financials, Restaurants, Consumer Staples, and so on.... Appliances? Whirlpool anyone???
But folks..... I dare you to find a sector outperforming the AUTOMOTIVE SECTOR....
And it all boils down to this.... Are we in a BUBBLE??? an AUTO-BUBBLE? Cause the day FORD reports a Quarterly Loss could very well be a Scary Frightening Day for the Stock Market.
BEARS looking for something to trigger a massive market correction to the downside need only look at the Automotive Sector.... The Auto-Bubble.....If people aren't buying cars....There's a reason for that.
GREAT DEPRESSION???? What was the first sector to take a big hit in 1930s??? CARS!!!
CARS stop selling.....fuel demand declines big.....homes stop selling next....and then you have consumer staples, financials, consumer cyclicals and so on falling off a cliff.... It all starts and ends with the CARS!! <----
So....want to predict the next 2007 beginning of a market correction / nasty recession???
Just ask yourself....hmm....How's FORD doing? [more]
Unfortunately Scottrade is Kapoots all weekend this weekend so I don't have access to as much information to make my point. So I'll be brief.
There are 2 ways to be a LONG TERM investor that I know of....
Approach 1: Buy a stock AFTER a great earnings report..paying UP for the stock in hopes it still has some room to run.
Approach 2: Finding a still beaten down stock price from a company that appears to be doing well...appears to be a turn-a-round story...
I am a strong believer in both approaches as solid good approaches...
When I invest.. It is sometimes #1 and sometimes #2....
But......how patient must one be? How long do you wait for your beaten down stock to finally produce results you believe it will eventually?
Here's my question to you.... How long before we see (ETFC) @ $5.00 a share?
(FBC) @ $5.00?? (C) @ $10.00????
How long does one wait?? The big money guys don't want to wait for their payouts... They wait for a solid earnings release or two to come out before jumping in.
George Soros got into (F) about 1 month AFTER I bought into Ford....and several months after the stock bottomed.
George Soros isn't a guy that has as much patience as some of us on Motley Fool have.
But how much patience is too much?
Frankly... I have to pin-point something about a mediocre earnings release that shows signs of improvement and cling to it. So... I look for perhaps Market Share.... Or I look for Sales....or I look for expansion!
So I can hold onto a sideways trading (SVA) for quite awhile than I can a stock that doesn't yet show any improvements in anything.... SVA has shown expansion improvement is coming into 2012.... That keeps me at least a shareholder for that long. After that I will want to see something else about SVA to convince me to stay longer.
I jumped on board (CBOU) prior to the Q1 earnings release and I am enjoying the ride up here because I channel checked the company several times before buying shares of CBOU.
Now I personally can testify to an increase in traffic and sales going on at SBUX and CBOU and many other smaller coffee & tea shops in downtown districts.
It's like with American Eagle... As soon as I started buying clothes from American Eagle, the earnings releases got much better....sales overall got better.... Channel checking works more often than not but it still can fail!!!
Bottom Line..... The reason for catalysts....is to motivate you as a long term shareholder beyond just the daily ticker price action. [more]
1. (MCD)s just filed a hefty lawsuit against Burger King after having watched their latest commercial showing the Burger King Mascot stealing the Mickey Ds recipe for Filet o' Fish...and then boasting they have the same item on their menu as McDonalds.
2. (RMCF) (HSY) Investors in droves dumped their GOLD and SILVER holdings in favor of CHOCOLATE. There appears to be a mass worldwide Chocolate Shortage..err...at...least....that's what investors were lead to believe by bizzarre comments made by the C.E.O.s of Rockey Mountain and Hershey. Of course, it could all just be a rumor.... But with Chocolate Commodity Prices spiking up 1000% today, there has to be some truth to it right?
3. (GS) Goldman Sachs, after a very long and heated court battle that took things straight to the United States Supreme Court, reported gleefully that they wont their case against the SEC for manipulating the markets. Now the U.S. Taxpayers will have to pay Goldman Sachs $14 trillion in damages + court fees before they can ever even think to pay down the U.S. debt.
President Obama wasn't available for comment.
4. Ben Bernanke steps down from Fed. Chairman position citing "retirement decision was his own" and Barney Frank makes it onto the short list for potential Fed. Chairman. Nancy Pelosi is staying out of it choosing instead to focus on her campaign for Treasury Secretary.
5. President Obama signs into law a "SODA TAX" with a beaming Michelle Obama at his side. This is as much a victory for Michelle Obama's campaign against child obesity as it is for the President. Shares of (SBUX), (CBOU), and Green Mountain Coffee Roasters spike upwards 10%-15% today off the news. Apparently, investors believe now more than ever people will reach for a Coffee for their Caffeine addiction rather than a Soda Pop. Furthermore, stock analyst from JP Morgan Chase (JPM) cites the super expensive coffee choices at SBUX and CBOU no longer look so expensive after this SODA TAX.
Don't get me wrong... I am just as happy if it was Michelle Bachman, Sara Palin, or Paul Ryan....
(notice I purposefully omit Mitt).
But seriously? The 1st Term Congressman is about to get one of his first if not his first bills he is a sponsor of signed by the President and it is going to be a Bi-Partisan Bill during a time no one thinks anything bi-partisan can happen.
This particular bill is easy to support and most likely will pass the House and Senate. President Obama has already said he would sign it. This bill would mean taking unused annual leave and assigning it to TSP for uniformed military members and federal employees.
Which brings me to my 11th company I most wish was a stock I could invest in.. (TSP) [more]
Ok you got my argument that DPS is waaaaaaaaaay overpriced....
So I guess it might be useful to hear the argument as to DPS at a trading range of $34-36
is actually underpriced...
Now.. I am not pointing to Techies... main reason I am posting up these posts on DPS is well for one thing...( I WAS RIGHT ABOUT FORD!!!!!!) and the 2nd thing is that Analysts consistently refuse to explain their optimism over DPS.... They just point to a Chart with some multi-colored squiggley lines as if that's good enough explaining there.... what the heck???
Not all of us are PSYCHIC here.... we need actual analysis!!!!
So here goes..... Given everything I explained in my previous blog on DPS that investors won't pay any more than 16 times earnings for DPS and that right now $2.30 for 2010 earnings is already priced into the stock......and that dividends + buybacks + cash on balance sheet means nearly nothing when it comes to determining what Multiple Investors are willing to spend money on DPS for...
Given all that I explained before..... Here's a counter argument...
DPS has raised their initial earnings expectations before.... and they can raise them again.
But even still....When it comes to saying DPS should be trading in the MID-40s... you would need Dr. Pepper Snapple Group to lift the top of their range $2.30 per share earnings 2010.....to an expected $2.50. At 16 times earnings....that just gets you to $40.00 even.
But at a $34 handle..... 6 points + dividend is rather nice! Especially when analysts are expecting the dividend to be raised sometime this year / beginning next year.
So you have a stock with 6 points + increased dividend possible if the C.E.O. during conference call thinks the company can pull off $2.50 this year.
But where is the evidence they can do that?
$2.30 assumes a 11-12% increase over the $2.17 they did 2009 ($1.97 not including certain items).
So...we need at least a range of 15% increase in earnings to pull off $2.50 for 2010 or $40.00 a share at 16 P/E.
Is that doable? Consider Dr. Pepper Cherry Superbowl Commercial and at least TWICE in Q1 Varchild found 1 local Walmart with nearly universally sold out DPS products in the SODA Aisle.
Earnings for Q1 have to be breathtakingly good and if they are....then expect the high end of the range to be lifted closer to $2.50....and well...maybe $40.00 isn't so hard a target to reach this year?
Does DPS have a 15% growth rate? [more]
Varchild's TOP 10 "I wish they were a public stock" Companies:
10) CHICKEN SHACK: http://www.chickenshack.com/
Why? Great Tasting Food and they are a VERY VERY Small Cap company compared to KFC.
Don't we all love to buy shares of the tinier company that has faster growth?
Chicken Shacks can be found only in Michigan I believe.... They have been operating for more than 50 years.
9) College Hunks Hauling Junk http://www.1800junkusa.com/franchise
Ok.. Don't Laugh... But considering that I have a 100lb. Television that needs hauling and I can't lift it 1 single inch much less get it onto a dolly...and even if I did get the thing onto a dolly i'd have to some how bound it down a flight of stairs in my multi-storied apartment complex.... No Thanks!!!!!
Since I can't think of who else would get the job done....other than these guys.... then heck...no wonder this company is considered to be one of the fastest growing companies in America operating in nearly 20 different States in the U.S.A.
Since a portion of revenue is donated to College Scholarships it is a tough call to decide if they are a Small Cap company or a Mid-Cap.
8) Lewis Galoob Toys inc. www.hasbro.com [more]
Instead of calling SCAM-O-BOT scares.... It's now SCAM-O-TRON for the relentless articles on Motley Fool that we get tearing down great American Namebrand Corporations for their success.
Is it anyone's surprise that Motley Fool's article writers lean left cause David/Tom Gardner do?
With that aside... Some interesting facts about DreamWorks Animation and the constant badgering of FORD Motor Company's success.
1) The Author Rich Smith (TMF Ditty) makes the following intelligent reasoning behind his choice of adding FORD on his list of DUD stocks going forward:
"Problem is, if the price goes up too much, even a great company can turn into a lousy investment. Below I list a few stocks that may have done just that. Stocks that, according to the smart folks at finviz.com, have more than doubled over the past year, and just might be ripe to fall back to earth."
Hmm no mention of FORD.... Not anywhere in the article. Instead he attacks DreamWorks never bothers to get around answering for his other selections.... *sigh*
2) And attacking Dreamworks Animation for what exactly?
"Why am I so down on DreamWorks? Last month, I wrote that "within the fetid swamp of overpriced equities that is the film industry, DreamWorks smells slightly less stinky than the moderately overpriced Disney"
Wow!!! 4 Earnings Beats by HUGE LONG SHOTS and Rich provides the stock with a "Slightly Less Stinky" rating???? Gee that makes sense....right......doesn't it??? oops...no I guess not.
"Why? Because it costs too much. It cost too darn much last month, and it still costs too much today."
What do you think this company sells? Solar Panels? This is a Film Industry Stock with a P/E well below the average of that sector that produces the BEST ANIMATED KIDS FILMS in the whole industry.
This is like getting Marvel Entertainment for 1/2 price compared to where they may end up in the next 5 years.
Face it.. Dreamworks Animation has produced earnings reports in 2009 that show that they are producing ACCELERATED PEDAL to the METAL earnings that have nothing to do with their 5 year historical earnings growth pace. These earnings deserve higher P/Es when they embarrass the heck out of the company's historical earnings levels.
"Over the six weeks since I first panned it, DreamWorks shares have already shed 10% of their value -- versus a 7% gain for the S&P 500. Yet even today, what we have in DreamWorks is a dividend-less stock, that costs in excess of 23 times earnings, sells for an even more frightening 35 times free cash flow, and yet is projected to grow at barely 16% per year over the next half decade."
So $2.66 per share CASH FLOW is skimpy?? Wait.... How in the heck do you get 35 times free cash flow here?
At $2.66 per share CASH FLOW with ZERO DEBT to speak of RICH.....
I calculate that on my trusty Mechanical Calculator: 15 times earnings.... NOT 35!
The stock trades at 15 times cash flow and as this company's earnings go SKY HIGH off Shrek 4 sequal earnings.... Guess what? If the stock sits at $40 or slips as RICH is hoping it falls....
Then the Multiple to Cash Flow will quickly drop below 10 and everyone and their brother, sister, mother, father, grandfather, grandmother, uncle, cousin, nephew, aunt, friend, coworker, and acquaintance will want to buy shares of DWA. [more]
Despite seeing the stock rally a lot and hold into a range of $34 - $36.... I really do not see how the stock trades where it is....
The only reason it is in the Mid 30s here is because of 2 things...
Euphoria over the Pepsi/Coca Cola deal pushing the P/E multiple from 13 to roughly 16 times earnings. Investors are paying MUCH MORE for DPS earnings.
I am not a big fan of throwing in Dividend + Cash to value how much I want to pay for a stock in multiple. My analysis is simply EARNINGS = Multiple.
Top of the Range for DPS earnings this year? $2.30.
Which gives us a range of $34 - 37.00 for a multiple of 13 - 16.
So....uhm....why exactly are analysts predicting DPS at mid-40s this year?
I think DPS is basically stuck in the range it is in until next year if next year's earnings are greater than this year. [more]
What if (F) Ford reports an EPS of 38 cents per share in Q1?
First of all if the average EPS is 38 cents per share by the end of this year we would be talking about a 12 EPS of $1.52.
That seems fantasy when Analysts are currently expecting 2010 EPS of $1.01 for FORD.
But.... My 38 cents EPS isn't entirely off the mark considering FORD has beaten the most optimistic analyst in the past 4 quarters by a range of 4 - 10 eps.
The most optimistic analyst according to SCOTTRADE CHARTS shows a Q1 eps of 37 cents.
A 4 cent beat on the high goes quite higher than my 38 cent expectation....it is 41 eps.
Ford beats by 4 eps from the high estimate and that means the average 38 eps quarter to quarter or a $1.52 becomes extremely likely from extremely unrealistic.
Because the next quarter's biggest optimist is marked at 35 eps on the high and this Q2 will include in JUNE the sale of FORD FIESTAs. FIESTA goes into production in Mexico starting in MAY. 4 cent beat on the high is 39 eps.
So that's 1/2 of the year in which it is reasonable although optimistic as heck to expect FORD to produce earnings well above my 38 EPS per quarter average.
After that... It will be extremely tough for the staunchest pessimistic analyst to have a full year EPS expectation during Q3 all that much lower than $1.52.
This makes me excited to say... that even at $1.50..... shaving off 2 cents...
FORD at 10 P/E should be a $15.00 stock. With the excitement surrounding FORD FIESTA in full effect this coming THIRD Quarter... FORD trading anywhere below $15.00 a share would be an extremely good time to buy.
So... If that's the case and today we have FORD at a 12 handle.... How is FORD...fairly priced today? Much less overpriced? FORD at 12 is well underpriced.... [more]
Captchas still exist everywhere from Forums to Membership Subscriptions and so throughout the Internet. I've found out many years ago that the Captcha Code you have to type to sign up for something DOES NOT WORK to eliminte robot invasion.
I think www.fool.com is just the latest victim from those who believed CAPTCHAs were the answer to eliminating BOTs. Ticker Replies to comments...Blog Replies to Comments... and most likely this one will get invaded by BOTs.
Here's a simple way to eliminate BOTs.
Set up an automatic process to eliminate everyone's account on Motley Fool that has ZERO CAPS picks and ZERO CAPS score.
This will allow normal users to carry every once in awhile a ZERO CAPS pick portfolio.... Because your CAPS SCORE will still exist from your previous CAPS picks....
But those accounts that not only currently have ZERO CAPS picks....but also ZERO CAPS score.....
Those accounts are all entirely the BOT accounts. Seems like it should be possible to set up an automatic removal of these BOT accounts in 1 fell swoop once every 7 days. [more]
Yes..... I am making a BOLD statement here and actually I already made this statement back in 2008..... There is just a consistent enough pattern that it must be mentioned again.
The Biggest SCAM of this or any Century is what in my OPINION appears to be intentional bad mouthing, tearing down, of stocks or stock prices in order to generate a steady decline in share price.... until.... some foreseeable already pre-determined date....a bunch of money guys come in and get to buy their shares at cheaper prices.
Of course for this SCAM to actually be real... and it may not be..... Money Managers would have to know an awful lot of Media Journalists and Reporters and Stock Analysts from multiple sources who would be willing to voice Negative/Positive Articles on stocks at will.
But..... I don't really believe it works that way.... I think the SCAM is mostly about the RUN-UP to a major Earnings Release and then *BAM* money managers make their moves buying a stock lower based on a series of Negativity Floating around the Stock in multiple Media Articles.... and enjoying the Stock Price CLIMB shortly afterwards...
Look at it this way....
How can article after article exist for FORD after a quarterly earnings report that praises FORD???? You read these articles and you can't but help believe FORD is the ultimate GOD STOCK to invest in.. (which it is not as no stock is a 100% risk free investment)...
But the run-up to the earnings.....of FORD... behind the earnings of FORD... You get nothing but CAT CALLS of "FORD Shares are Overbought!"
Check yahoofinance.com behind an earnings release.... and ahead....of a stock like FORD.
Am I wrong to declare "SCAM" simply because like clockwork you see these patterns and think how in the world can Journalists and Stock Analysts just operate like ROBOTS?
They are suppose to analyze..... Not act like your Living Room's ROOMBA. Do just fine cleaning up your place after you start the robot.... only to get stuck in a corner or on a deep pile carpet/rug later? and then you have to pick it up and move it and your back to normal?
Wednesday 3:24p.m. Motley Fool " 6 Cyclical Stocks That are Overbought"
Now I haven't read the article but the Headline appearing on FORD's page would make anyone shy away from buying shares of FORD at its current share price..... Except BIG MONEY GUYS that perhaps take advantage of this crap?
And of course... none of this is a SCAM if you already recognize the absurd pattern..... Just have to *play along* with the on-going SCAM-O-BOT scheme and a series of negative articles behind an earnings release = BUY BUY BUY..... while a series of positive articles behind one = SELL SELL SELL.
In my opinion...
First you have (GAME) producing sensational Q4 earnings and the share price takes a plunge because of disappointing forward earnings projections from the company....
Now we have (SVA) reporting sensational Q4 earnings.....and the share price takes a plunge because of disappointing full year 2010 earnings projections...
Nevermind the fact that Sinovac Biotech surpassed just as they said they would their 2009 earnings projections quite handily.....
Nevermind that they will surpass their conservative earnings guidance in 2010.........
Promise low.....deliver high....... That's what a lot of China Stock Company's do.....
And yet Wall Street continues to punish the crap out of these stocks for missing "Whisper Numbers" on forward earnings outlooks.
Hey.. I've been in some disappointments with American Stocks..... Sure..... But this is insane... especially when I took a massive hit in 2008 off of (FEED) AgFeed Industries.....
That's 3 times in a row!!! Well.... I am thinking... 3 times and I'm out of CHINA. [more]
I'm buying a house.... so there goes my entire stake in (GAME) and 1/2 (ATVI) to fund the house purchase.
hmmm 1/2 stake in ATVI??? Doesn't make sense... So there goes my entire stake in (ATVI) in favor of what I believe to be a very undervalued (CBOU).
The fact that I am addicted to Carribou Coffee this past Q1 solidify my decision to exit ATVI.
I'll probably celebrate my decision to start building a stake in CBOU this weekend......at a CBOU Coffee Shop.
So.... I buy a Coffee stock..... and I may be on the verge of buying a HOUSE.
So I am buying a COFFEE....HOUSE.
I just hope Obamacare gets repealed because earnings will take a tremendous hit against any store franchise that sells food and needs to put up some calorie numbers.... A Coffee house typically adds/replaces food items frequently to entice more consumers.... How does Carribou do that anymore if they have to conduct a Food Test and change their Menus every time? [more]