• Baxter’s Dividend and Fiserv’s New High
    Posted by on November 9th, 2010 at 3:04 pm

    I knew this week was going to be slow for market news, but it’s duller than I had imagined it would be. Coming after a week jammed with elections, the Fed meeting, the jobs report and more earnings, this week is a nice relief.

    The best news today is that Baxter International (BAX) decided to raise its dividend. That’s a nice vote of confidence by the board and it’s also a good present for shareholders. As I’ve said many times, I greatly prefer cash dividends over stock buybacks.

    Shares of Fiserv (FISV) also broke out to a new 52-week high today of $56.12. The stock gets ever closer to its all-time high of $59.59 reached three years ago. The stock is going for just 12.5 times next year’s earnings. I find it amazing that Fiserv is trading at the same valuation as the rest of the market. This is a company whose earnings climbed steadily during the recession. Earnings-per-share this year will be more than double the EPS from 2004.

  • Gold Surges to Record High
    Posted by on November 9th, 2010 at 12:10 pm

    Gold is now down only 40% over the last 30 years (adjusted for inflation).

  • Alternative Investments
    Posted by on November 9th, 2010 at 11:59 am

    Since 2002, what asset class has averaged 11% per year?

    Give up? I’ll give you a hint: fine wine!

  • Apple Hits New All-Time High
    Posted by on November 9th, 2010 at 11:32 am

    Shares of Apple (AAPL) have been as high as $321.30 today. The stock is now up more than four-fold in less than two years.

  • JPMorgan Had Perfect Trading During Q3
    Posted by on November 9th, 2010 at 11:02 am

    From Bloomberg:

    JPMorgan Chase & Co. racked up a perfect trading record for the second time this year, making money every day last quarter after accomplishing the same feat in the first three months of 2010.

    Cumulatively, the results mean the New York-based bank made more than $200 million on 12 days in the first nine months and lost money on only eight, JPMorgan said today in a regulatory filing.

    JPMorgan, the No. 2 U.S. lender by assets, follows Bank of America Corp. in reporting a perfect record for the quarter. Goldman Sachs Group Inc., which makes the most revenue on Wall Street trading stocks and bonds, had losses in that business on two days during the third quarter while Morgan Stanley reported 10 losing days for the period.

    Trading revenue at eight of the biggest Wall Street firms declined an average 12 percent through September from the same period a year ago. Goldman Sachs generated 69 percent of revenue this year from trading, and said third-quarter trading results declined 36 percent. The seven days that New York-based Goldman Sachs made more than $100 million last quarter were the fewest since the fourth quarter of 2006.

    Morgan Stanley said yesterday it made more than $100 million on one day last quarter, versus 18 days in the third quarter of 2009.

    Morgan Stanley, also based in New York, had $1.43 billion in total sales and trading revenue for the third quarter, the lowest since the first quarter of 2009. Excluding losses and gains tied to its own credit spreads, Morgan Stanley generated $1.31 billion from trading fixed-income products, down 24 percent from the second quarter.

  • Baxter Raises Dividend
    Posted by on November 9th, 2010 at 9:56 am

    Good news from Baxter International (BAX). Three weeks after releasing a very good earnings report, the company is raising its quarterly dividend from 29 cents to 31 cents per share.

    The dividend is payable on January 5, 2011 to shareholders of record as of the close of business on December 10, 2010. Going by today’s price, Baxter yields 2.4% which is just below the yield of the ten-year Treasury.

  • Morning News: November 9, 2010
    Posted by on November 9th, 2010 at 8:16 am

    Stock Index Futures Signal Early Dip

    Gold Hits Record on Euro Zone Debt Fears

    China and Germany Slam U.S. Policy before G20 Summit

    Fed Officials Voice Concerns about Bond Buying

    The Return of the Risk Arbs

    The Flash Crash, in Miniature

    Bankruptcy Filings Jump 14% in 2010

    Publishers to Get 70% of Sales on Kindle Device

    Barclays Profit Declines 76%, Says Capital Remains ‘Strong’

    BP May Pay Billions for `Missed Signals’ That Led to Disaster

    Ben Aronson’s ‘Risk and Reward’ Exhibition

  • Wheel of Fortune Solved With One Letter
    Posted by on November 8th, 2010 at 4:04 pm

    Way to go, Caitlin.

    Via William Wei

  • 5/30 Spread
    Posted by on November 8th, 2010 at 3:13 pm

    No commentary here; I was just struck by the huge spread between the 5-year and 30-year Treasuries. There are now 300 basis points between the two.

  • Short-Term Rates on Growth and Value
    Posted by on November 8th, 2010 at 2:08 pm

    I was curious to see what the impact of changes in short-term interest rates is on growth and value stocks.

    I used the Vanguard Growth (VIGRX) and Vanguard Value (VIVAX) funds as proxies and looked at how they reacted to changes in the 90-day T-bill. The data goes back to 1993.

    I found that there were 1,737 days when short-term rates fell, 1,739 days when short-term rates rose and 950 days when short-term rates stayed the same. I then averaged out those periods to annualized periods.

    When short-term rates fell, Value fell by 21.78% while Growth fell by 18.96%.

    When short-term rates stayed the same, Value rose by 16.65% and Growth rose by 19.10%.

    Finally, when short-term rates rose, Value rose by 42.54% and Growth rose by 36.13%.