Dear Diary,
Medtronic (MDT) is reported to have a current ratio of 1.89. While I'd like to see this ratio at 2 or higher, I can live with it until it drops to below 1.
"Value Line" reports the Lond Bond Yield at 4.4% this week.
Gene
Sunday, February 24, 2008
Wednesday, February 20, 2008
Long Bond Yield
Dear Diary,
"Value Line" presents the 30 Year Treasury Bond Yield to be 4.28%.
I've narrowed my interest to 20 stocks out of about 2000 covered in "Value Line," for my Buffett purposes. I may list them in a few days. Per share earnings for the 20 is just a bit over 16% per annum on average, so we might expect as much as 40% compounded growth from the group, if I don't bother them too much. I've not yet invested in them, as a group.
Gene
"Value Line" presents the 30 Year Treasury Bond Yield to be 4.28%.
I've narrowed my interest to 20 stocks out of about 2000 covered in "Value Line," for my Buffett purposes. I may list them in a few days. Per share earnings for the 20 is just a bit over 16% per annum on average, so we might expect as much as 40% compounded growth from the group, if I don't bother them too much. I've not yet invested in them, as a group.
Gene
Sunday, February 10, 2008
Minor Conflict of Information
Dear Diary,
I am reading in my "Value Line Investment Survery" materials that the long bond (30 year treasury bond) appears to be trading at 4.12%, while the Federal Funds Rate is at 3%. This 1.12% difference in numbers is not anything that will cause any panic in my investment calculations, but it does give me pause that neither Warren Buffett nor David Clark, both of whom examined and commented on my work in the past, has ever drawn my attention to this difference. Hum.
I'm studying Hansen Natural (HANS) today. It presents flawless numbers in "Value Line." I'm calling for a financial report tomorrow. With projected earning per share for 2008 at $2.10 per share, I calculate a relative value to the Federal Funds Rate (3%) at $70.00. On the other hand, the 4.12% yield on the long bond discussed above would present a relative value to be $50.97. Warren believes the average of all interest rates is 10%, which offers a relative value of $21.00. HANS is trading at $38.00 per share and growing earnings at 45% per annum.
HANS is not a giant monopoly, so the closer to the 10% calculation I can get, the better.
Gene
I am reading in my "Value Line Investment Survery" materials that the long bond (30 year treasury bond) appears to be trading at 4.12%, while the Federal Funds Rate is at 3%. This 1.12% difference in numbers is not anything that will cause any panic in my investment calculations, but it does give me pause that neither Warren Buffett nor David Clark, both of whom examined and commented on my work in the past, has ever drawn my attention to this difference. Hum.
I'm studying Hansen Natural (HANS) today. It presents flawless numbers in "Value Line." I'm calling for a financial report tomorrow. With projected earning per share for 2008 at $2.10 per share, I calculate a relative value to the Federal Funds Rate (3%) at $70.00. On the other hand, the 4.12% yield on the long bond discussed above would present a relative value to be $50.97. Warren believes the average of all interest rates is 10%, which offers a relative value of $21.00. HANS is trading at $38.00 per share and growing earnings at 45% per annum.
HANS is not a giant monopoly, so the closer to the 10% calculation I can get, the better.
Gene
Thursday, February 7, 2008
Looking At Jones Soda
Dear Diary,
I've just called for a copy of the most recent financial report of Jone Soda Company (JSDA). This company seems to be gearing up for some interesting growth. The evident founder of the company has returned to be CEO after a rough 2007 and the resignation of the past CEO. I actually offered to go to work for them, I'm so impressed with the $6 share price and current ratio of 7. I think they need to raise prices and back off enough on marketing expenditures to show a profit and a wider net profit margin than the current 1, I'm seeing. They are spending money like a teenage boy trying to get a date with the homecoming queen, and they need a mature mind to tell them to take a breath.
Harley Davidson (HOG) shows a current ratio of 1.8, and I'm not happy about that; however, I'm going to sit until I see Spring sales before I change any position in the stock. The situation may quickly right itself. If the ratio drops to below 1, I will absolutly not tollerate holding the stock, as this will show flawed internal economics.
Everything else is doing fine.
I'm gonna waite on Pfizer (PFE) to buy up some other drug companies and get back into growing the company before I invest there.
Gene
I've just called for a copy of the most recent financial report of Jone Soda Company (JSDA). This company seems to be gearing up for some interesting growth. The evident founder of the company has returned to be CEO after a rough 2007 and the resignation of the past CEO. I actually offered to go to work for them, I'm so impressed with the $6 share price and current ratio of 7. I think they need to raise prices and back off enough on marketing expenditures to show a profit and a wider net profit margin than the current 1, I'm seeing. They are spending money like a teenage boy trying to get a date with the homecoming queen, and they need a mature mind to tell them to take a breath.
Harley Davidson (HOG) shows a current ratio of 1.8, and I'm not happy about that; however, I'm going to sit until I see Spring sales before I change any position in the stock. The situation may quickly right itself. If the ratio drops to below 1, I will absolutly not tollerate holding the stock, as this will show flawed internal economics.
Everything else is doing fine.
I'm gonna waite on Pfizer (PFE) to buy up some other drug companies and get back into growing the company before I invest there.
Gene
Thursday, January 31, 2008
Fed Drops Interest Rates Another 50 Basis Points
Dear Diary,
Yesterday, the Federal Reserve Bank lowered the long bond yield to 3% from 3.5%. This drop further drives the relative value of my holdings and all stock prices upward.
Gene
Yesterday, the Federal Reserve Bank lowered the long bond yield to 3% from 3.5%. This drop further drives the relative value of my holdings and all stock prices upward.
Gene
Thursday, January 24, 2008
Long Bond Yield Drops
Dear diary,
After a night of 5% to 8% drops in world markets a couple of nights ago, the Federal Reserve lowered its yield on the 30 year Treasury bond 75 basis points to 3.5%. This changes our calculations on owned stock relative values as follows:
Symbol/ Expected 2008 Earnings/ Long Bond Yield/ Relative Value
MDT $3.00 3.5% $85.71
AEO $2.20 3.5% $62.86
HOG $3.95 3.5% $112.86
I called Pfizer (PFE) for an investor kit a couple of days ago, as well. Expectations are that the revenues by 2011 will potentially be cut in as much as half, due to patents ending on major products. However, they have a giant business that can adjust prices to inflation or loss of patents in many products and other drugs. They also stand to buy up lots of smaller drug companies between now and 2011. With the current share price about $23 a share, the relative value even of the dividend alone presents excellent price appreciation in the coming years. PFE would have to go out of business to be a risky investment, based on my Buffett training.
Concerning the markets, they are reacting to an over-extension of credit, combined with inflation in the M1 Money Supply by Congress. The 5th plank of "The Communist Manifesto" is doing what it was designed to do: rattle the property out of the hands of individuals and place it into the hands of politicians and rich people. Will we ever learn that central credit in the hands of politicians and rich people only leads to poverty for the masses?
Gene Chapman
After a night of 5% to 8% drops in world markets a couple of nights ago, the Federal Reserve lowered its yield on the 30 year Treasury bond 75 basis points to 3.5%. This changes our calculations on owned stock relative values as follows:
Symbol/ Expected 2008 Earnings/ Long Bond Yield/ Relative Value
MDT $3.00 3.5% $85.71
AEO $2.20 3.5% $62.86
HOG $3.95 3.5% $112.86
I called Pfizer (PFE) for an investor kit a couple of days ago, as well. Expectations are that the revenues by 2011 will potentially be cut in as much as half, due to patents ending on major products. However, they have a giant business that can adjust prices to inflation or loss of patents in many products and other drugs. They also stand to buy up lots of smaller drug companies between now and 2011. With the current share price about $23 a share, the relative value even of the dividend alone presents excellent price appreciation in the coming years. PFE would have to go out of business to be a risky investment, based on my Buffett training.
Concerning the markets, they are reacting to an over-extension of credit, combined with inflation in the M1 Money Supply by Congress. The 5th plank of "The Communist Manifesto" is doing what it was designed to do: rattle the property out of the hands of individuals and place it into the hands of politicians and rich people. Will we ever learn that central credit in the hands of politicians and rich people only leads to poverty for the masses?
Gene Chapman
Tuesday, January 15, 2008
Things Are Looking Good
Dear Diary,
American Eagle Outfitters (AEO) and Wal-mart are the only two retail companies in the black for the Christmas holidays, it seems, as I saw on the "Nightly Business Report" a few nights ago. AEO is at 10 times earnings.
Harley Davidson (HOG) is waiting for Spring sales to see what upside is there for them, now selling at 10 time earnings.
Medtronic (MDT) continues to putt right along at 19 times earnings.
Gene
American Eagle Outfitters (AEO) and Wal-mart are the only two retail companies in the black for the Christmas holidays, it seems, as I saw on the "Nightly Business Report" a few nights ago. AEO is at 10 times earnings.
Harley Davidson (HOG) is waiting for Spring sales to see what upside is there for them, now selling at 10 time earnings.
Medtronic (MDT) continues to putt right along at 19 times earnings.
Gene
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