• Earnings from Moog and Becton, Dickinson
    Posted by on November 5th, 2009 at 12:08 pm

    We had two more Buy List earnings reports. Becton, Dickinson (BDX), which I like a lot, saw its earnings rise to $1.25 a share for its fiscal fourth quarter which matched estimates. They made $1.11 for last year’s fourth quarter. Wall Street expects earnings next year of $5.09 which works out to a growth rate of 3%. This means the stock is currently going for about 13 times earnings.
    As I’ve mentioned before, I haven’t been very pleased with Moog (MOG-A) this year. The stock is down about 30% and it’s the worst performer on the Buy List. For this past quarter, the company earned 35 cents a share which was less than half what they made for last year’s third quarter. They missed Wall Street’s call by a penny a share. For the second quarter, they missed the Street by 10 cents a share.
    The only good news is that Moog sees EPS ranging between $2.15 and $2.35 for next year, which means the stock is somewhat reasonably priced.

  • The Periodic Table of Finance Bloggers
    Posted by on November 5th, 2009 at 10:18 am

    I’m honored and humbled to be included on The Reformed Broker’s Periodic Table of Finance Bloggers.

  • Today’s Productivity Report
    Posted by on November 5th, 2009 at 10:15 am

    I’m simply stunned by today’s report on productivity.

    The productivity of U.S. workers surged in the third quarter at the fastest pace in six years as companies squeezed more from remaining staff to boost profits.
    The measure of employee output per hour jumped at a 9.5 percent annual rate, topping the highest estimate of economists surveyed by Bloomberg News, Labor Department figures showed today in Washington. Labor costs fell at a 5.2 percent rate, capping the biggest 12-month drop since records began in 1948.

  • Quote of the Day
    Posted by on November 5th, 2009 at 10:10 am

    From Eric Falkenstein: “A prig is someone wedded to a theory that explains everything, and can be highly mathematical and conventional, like Phillipe Jorion, or highly obtuse, like Nassim Taleb’s insight that ‘risk is what you don’t expect’ [which I find not profound, but irrelevant].”

  • Something about Decades
    Posted by on November 4th, 2009 at 9:49 am

    With only a few trading left for the “aughts,” I’m reminded that many cycles have begun and ended when the tens digit changes on the calendar. There was, of course, some unpleasantness in 1929. Also, the price of gold peaked a few days into 1980. The Japanese market peaked on the very last day of the 1980s. The Nasdaq’s run reached its zenith not long into 2000. Gold also reached its most recent low point in mid-1999.
    If read this kind of thing in the newspaper, I’d dismiss it as someone being fooled by randomness. Still, it is interesting to note.

  • Gold Hits New All-Time High
    Posted by on November 4th, 2009 at 9:35 am

    The yellow metal is closing in on $1,100 an ounce. But gold has a long way to go to match its inflation-adjusted high from 30 years ago. Gold would still have to double from here to reach that.

  • Historical Footnote to Today’s Election
    Posted by on November 3rd, 2009 at 10:57 pm

    Today is Election Day in New York and after 34 years in office, 90-year-old Robert Morgenthau did not seek reelection as Manhattan’s District Attorney. It’s an understatement to say that Morgenthau is a legend in New York politics. Consider that he ran for governor 47 years ago when he lost to Nelson Rockefeller. Obama was a little over one-year old at the time! Morgenthau tried running again in 1970 but his campaign didn’t get far.
    Morgenthau also comes from a very prominent New York family. His father was FDR’s Treasury Secretary, and his grandfather was Wilson’s ambassador to—not Turkey—but the Ottoman Empire (or if you prefer, the Sublime Porte). Henry Morgenthau Sr. is probably best known for publicizing the Armenian Genocide.
    Also, on the TV show Law & Order, the elderly DA Adam Schiff is based on Robert Morgenthau.

  • Berkshire Hathaway to Split 50-for-1
    Posted by on November 3rd, 2009 at 10:47 am

    It finally happened. Warren Buffett’s Berkshire Hathaway (BRKB) announced that it will split 50-for-1. These are the B shares, not the A shares which are still around $100,000.
    The Class A and B shares usually trade at a ratio of 30-to-1. If you own the Class A shares, you can convert it into 30 B shares, but not the other way around. The B shares, however, only carry 1/200th the voting power of the A shares.
    In other words, post-split, the B shares will be about 1/1500th of the A shares. Going by today’s price, the B shares will be around $65.

  • Cognizant Technology Rises on Earnings
    Posted by on November 3rd, 2009 at 10:45 am

    One today after saying that I’m probably going to ditch Cognizant Technology (CTSH) at the end of the year, the company comes out with great earnings.
    For the third quarter, CTSH earned 48 cents a share which creamed Wall Street’s estimates of 41 cents a share. For the fourth quarter, the company sees EPS of 49 cents a share.
    The company now expects earnings for this year of $1.88 a share. That means that it’s going for 22 times earnings which is a bit rich for me.

  • Thoughts on Next Year’s Buy List
    Posted by on November 2nd, 2009 at 12:38 pm

    Around mid-December, I’ll unveil the Buy List for 2010. As usual, I’m only planning on making minor changes. My goal of this site is to prove that investors can beat the stock market by not doing much. With investing, your laziness is often your best friend.
    I try to make sure that my changes aren’t a big surprise so I’ll share with you some of my thoughts about the Buy List. Some of the stocks that I’m considering cutting are Amphenol (APH), Cognizant (CTSH), Donaldson (DCI), Danaher (DHR) and Moog (MOG-A). Both DCI and DHR have been on the Buy List since the beginning.
    Stocks I’m considering adding include Johnson & Johnson (JNJ), Pfizer (PFE), Abbott Labs (ABT) and WR Berkley (WRB). WRB was on the Buy List in 2006 and 2007. These are just ideas so I may change my mind before I make the 2010 Buy List official in a few weeks.