Investing Blog

Yahoo and Carl Icahn are now on good standing after Yahoo gave Icahn three new seats on a board now 11 members strong. This will give Icahn and two others from his slate the ability to sit in on the discussions of the Yahoo board and even try to push policy. Yahoo is hoping that his three board seats will simply allow him to chime in on board events and withhold enough power that his votes will be easily overturned by the majority. Continue Reading »

Apple stock was never on my radar until the PEG ratios caught up with the price of the stock. Now that Apple stock is seeing good fundamentals line up with the technical there is plenty of reason for an investment. With a PEG ratio of 1.34 its playable, that’s not a bad ratio for a stock in a premium industry like tech. Continue Reading »

In this scary credit scenario it’s important to know whether your investments are FDIC insured or you will feel the full brunt of a banking collapse. Stocks, bonds and mutual funds are left uncovered by the FDIC as are annuities and insurance but there is one more investment that may surprise you. The difference between a money market account and a money market fund will leave one insured while the other is uninsured. Continue Reading »

The bailout news is growing out of what anyone could have expected. IndyMac was no small bank, its assets number $32 Billion. This isn’t a regional savings and loans blowup, IndyMac was very large and established as a major mortgage banking institution in the United States. Most of the depositors were under the $100,000 FDIC insurance threshold and will be able to make payments, draw checks and withdraw money via the ATM until this mess is sorted. Continue Reading »

Commodities prices tumbled today which is generally received as a very good economic indicator especially when the word recession gets thrown around. Corn prices touched $8 a bushel briefly but are back down to modestly to $7.46 after falling the daily limit. Fears of a rainy summer and minimal crop have disappeared, now it looks like this years crop might be near normal levels. Continue Reading »

The markets as a whole have lost plenty of value as of late but it appears as though at least one index is set for a rally. The S&P 500 is off by 13% since the beginning of the year but some technical analysis looks make it seem like we’re ready for a rally.

Continue Reading »

It’s hard to imagine the scale of the losses that the credit market and the overall market in general have seen over the past year. Certainly this credit crisis is larger than most of us have seen even in the duration of our lifetimes. Looking back at the past year we’ve seen plenty of negative news but very little to actually compare the size and scale of our current credit crunch to anything in history. Continue Reading »

Stocks inflows are generally what keeps the market afloat. High inflows mark times of good markets, outflows the opposite. While stocks don’t inherently rise and drop with money flow, mutual funds and hedge funds generally have to liquidate assets to afford withdrawals.

The financial sector is doing an interesting run around to bring in capital. Rather than issue debt, financial companies are issuing more common stock and preferred shares to bring in cash. The problem is that these new shares are like IPOs and diminish the shareholder value. This action is what creates stock inflation, something you rarely hear about but you’ll feel it when it happens to you. Continue Reading »

Today the DJIA fell below the crucial 12000 and even the 11900 mark. The good news is that we’re not yet below a very important trendline and the market looks like its ready to bounce. Fundamentals like the economic stimulus package have yet to add to earnings, that we may see in the fall, but for now it appears that the market is weak until a new catalyst appears. Continue Reading »

2008 should have solidified the belief in international funds. Domestic funds look terrible, they’re beaten down by the perma-oil bear and an economic downturn. But overseas things are looking on the up and up, actually they look great. Why? Developing nations practically control the world’s commodities, we buy their oil, their metals, their food. We used to produce the world’s food, but take a look at how much we’re sending into creating energy. Food for energy, ethanol, yuck. Continue Reading »

If there is one great thing about today’s volatility it is the quicker developing trendlines that come with it. Highly volatile stocks are pushing trends quicker, rather than having a week to a month in between top and bottom support and resistance lines, its taking just a few days. Large movements up and down fill out trends quicker and with more accuracy, slower trending is more likely to push out of an existing trend while quick movements mean a contained trend. Continue Reading »

The containers and storage products offered by Rubbermaid are sold by the billions. Without them, last weeks dinner would go straight to the trash and our pencils and pens would be without a container. It should come to no surprise that Rubbermaid is a great play against recession, its earnings are solid through sales of plastic containers and other products such as vacuum cleaners.

If anything is certain, its Rubbermaid’s bottomline which is something that can’t be said for most companies in today’s economic environment. At 11.5 times next years earnings, there happens to be a great bargain in the plastic products company. High energy prices may be cutting into its profits, but for the long term, this is a great brand to hold on to. Even better is that I’m looking for a 50% run in the next couple years. Continue Reading »

Hewlett-Packard is taking another large step to expand its horizons. The new deal with EDS will represent its biggest purchases since it bought Compaq in 2002. In buying EDS, HP hopes that it can expand its marketshare in the computer servicing sector. My thoughts, it adds plenty of shareholder value even if HP does take on some debt to finance the acquisition. Continue Reading »

Coca-Cola enterprises works alongside The Coca-Cola company to wholesale its products. It buys the product from Coca-Cola (KO) and resells it. Rather than the original company controlling from top to bottom, CCE is able to profit from emerging markets and sell at a discount to the larger manufacturer.

In my opinion, Coca-Cola Enterprises (the distributor) has plenty of exposure to emerging markets which makes Coca-Cola so profitable. While I do like the original manufacturer, I believe that CCE provides a better investment and exposure to the markets around the world. Better yet, CCE is selling at a huge discount from just this January when it topped $27 per share. Though the company is limited in its horizons, particularly due to the fact it must buy from KO to resell to other markets, it maintains hope for growing markets through its wholesale distribution. Continue Reading »

Bill Gates came out today to say that Microsoft will develop its own search engine marketing program. Google and Yahoo operate their own, but Microsoft has been falling behind its competitors. Google leads the way, nearly all of its profit is derived from its search engine marketing program. Yahoo has a similar program, still in beta, that produces some revenue but has very little marketshare in the Google monopoly.

This represents a much better deal for Microsoft shareholders and customers. Yahoo wanted a nearly 100% premium over their pre-bid price, far too much to pay for a company slowly losing marketshare. Not to mention that Yahoo’s own search engine program is still years behind Google’s which works with millions of webmasters around the world. (Yahoo’s is restricted to US residents) Continue Reading »

Scott’s Miracle Grow was in the mid $50s in 2007 and now its trading down at $30 per share. Though the company recently announced that it would be recalling four of its products, the long term credentials look no worse today than when the stock traded at $56 a share.

Today the company announced that four products are under recall. Two of which are improperly labeled and the other two weren’t yet registered with the EPA. While this does cause some short term troubles, the best time to buy in a good investment is when its cheap. The stock lost 10% on news that hardly affects the long term prospects, at this price, SMG is a great investment. Continue Reading »

Poor timing, too low price points? No, it appears that Yahoo might be avoiding a Microsoft buyout solely for sentimental reasons. Now that Jerry Yang is the CEO, it appears he’s wanting to hold onto the company he worked so hard to start back in his own college years at Stanford.

Yang owns about 4% of the company that is currently worth $1.5 Billion, his stakes are huge and he’s still drawing the infamous $1 salary that is common with many tech giants. His wealth has been derived in its entirety from the growth and capital gains he’s received as a huge shareholder in Yahoo. As CEO and a founder, it seems that his own unwillingness to sell might lay in a dislike for Microsoft and sentimental views of Microsoft rather than what shareholders want. Continue Reading »

The Federal Reserve Board meets again tomorrow to discuss the economy, inflationary factors and assess the current interest rate policy. Many analysts are undecided on which way the Fed will turn, will it continue to lower rates amid high inflation or pull back and let the market work itself out. Either action is likely to worry investors, high inflation eats away at returns while less credit means a stagnating economy and likely recession.

From here on out, each decision remains critical. Since the Fed opened its window and the auction block to institutional borrowers it has lent over $360 Billion. Keep in mind that this program was started in December of 2007, it has only been roughly 4 months for an average of $90 Billion per month. This kind of inflate and lend system is troubling many investors. Continue Reading »

You wouldn’t believe it but Ford has posted a quarterly profit of $100 Million for the first quarter of 2008. While the automaker has struggled with keeping up on pension programs and the weight they put on the price of automobiles finally good news and profits are coming out of the company. Ford still expects to lose money for the full year but spouts that it should return to profitability in 2009.

Strong profits in Europe and South America followed a weakening dollar and improved the overseas division. Back at home though, Ford struggled to sell its extensive line of “gas-guzzlers” and large trucks to consumers as sales were down 9% year over year. The weakening US sales were easily overwritten by foreign sales however. Continue Reading »

Starbucks released a very critical piece of information today. The economic slowdown in the US is affecting the premium coffee market and hard. Higher prices for coffee from a weakening dollar and slowing demand for a $4 cup of coffee has the luxury item in a headspin. Many Americans are finding that the daily latte proves too much for their pocketbook. Continue Reading »

Trading oil often requires a high level trading account in either the futures market or with a commodity trading firm. There are a few stock sectors that move in reaction to oil prices. Trading these stocks, in many cases, is just as good as trading oil itself. Continue Reading »

There is a serious resistance line still in play on the daily Dow chart. After the financial industry got the boot from investors, the market has fared pretty well. We’re back in the 12000s and keeping a reasonable trading range but there is just one trendline still in the way of Dow 13000. Continue Reading »

As the primaries wind down and the 2008 election year politicking reaches full swing, there is one major industry that is going to get a boost no matter the outcome, that is healthcare.

Election year politicking is dirty to say the least, Congressional bills get more and more ridiculous as each side hopes to present the other as complete trash. During cycles like this bills regarding guns, marriage, healthcare and military expenditures come full circle to be voted on. Continue Reading »

Now that we have a confirmation that recession might be around the corner from Ben Bernanke, we’re pretty sure that one is coming. A recession is a contraction in money supply, business and the velocity of money. Its hard to shop for a bargain in a recession because you never know how bad things just might get. Continue Reading »

I’d first like to start by saying that any company that can improve the bottom-line by means of cutting costs is a great company indeed. Sure we like to see a company with increased market share and revenue, but cost cutting is a great way to increase profits and show that the company is concerned about waste. There are millions of companies out there that are extremely profitable and would only be more profitable by decreasing expenses. When a company starts to look inside its offices to cut expenses, we’re all happy investors.

Dell has done just that. Continue Reading »