• The Market Reaches All-Time High
    Posted by on September 28th, 2006 at 4:25 pm

    Not the Dow. Not the S&P 500. But the Wilshire 5000 Total Return Index (^DWCT).
    This is the broadest measure of the stock market’s total retun. It includes several thousand stocks, and it’s adjusted for dividends.
    On March 24, 2000, the index closed at 47.84098. Today, it closed at 47.86562.
    For the record, the Dow closed at 11,718.45, which is just 4.53 points below its all-time high close from January 14, 2000. We did, however, peak into record territory during the day.
    The S&P 500 closed at 1,339.15 which is 12.3% below its record close. Adjusting for dividends, it’s down about 2.5%.
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  • The Election Cycle Begins
    Posted by on September 28th, 2006 at 3:01 pm

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    You only have one shopping day left to take advantage of the four-year Election Cycle. Major caveat: I don’t put much faith in any of this, but here’s what the data says.
    Going back to 1930, the Dow reaches its average bottom on September 30 of the mid-term election year. From that point until September 13 of the pre-election year, the Dow gains an average of 31.6%.
    That means that over 95% of the Dow’s four-year gain comes within the first 12 months of the Election Cycle.
    After that, the market then gets a bit dicey until May 25 of the election, losing 6.6%. But then things start heating up. The market puts on an impressive 19.4% rally to August 2 of the post-election year.
    Then all the troubles start. After August 2 of the post-ection year, the market slides an average of 9.4% until we’re home again–September 30 of the mid-term.

  • Danaher Hits All-Time High
    Posted by on September 28th, 2006 at 2:20 pm

    Forget the Dow, look at Danaher (DHR)! After a few days of heavy fighting, the stock finally took out its May high. Shares of DHR are up 23% for us year-to-date.
    From August 9 through yesterday’s close, our Buy List was up 10% compared with 5.6% for the S&P 500.

  • Second-Quarter GDP Revised to 2.6%
    Posted by on September 28th, 2006 at 9:10 am

    The initial estimate was for 2.5%, then it was revised up to 2.9%. Now it’s been cut back down to 2.6% growth.

  • The Dow & Terrell Owens
    Posted by on September 27th, 2006 at 3:39 pm

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    December 7, 1973: Owens born in Alabama. Dow rises 3% to 838.05.
    October 14, 2002: Sharpie Incident. Dow rises 27 points to 7,877.40.
    November 15, 2004: Desperate Housewives Incident. Dow rises 11 to 10,550.24.
    September 27, 2006: Owens denies suicide attempt. Dow rises 20 points to 34 points shy of an all-time high.

  • Irrational Pessimism?
    Posted by on September 27th, 2006 at 3:04 pm

    While the Dow is flirting with a new all-time high, the S&P 500 is still about 12% below its all-time. But what about earnings?
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    No wonder private equity is booming! Profits are up 57% since the market’s peak in March 2000. The market’s P/E ratio has nearly been cut in half.

  • Kobi Alexander Nabbed in Namibia
    Posted by on September 27th, 2006 at 11:38 am

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    Here’s a cool story: The Feds finally caught up with former Comverse CEO Kobi Alexander in Namibia. He’s been a fugitive from justice since he was charged with illegal options backdating. He even made it to the FBI’s most wanted list.

  • S&P Cuts Harley-Davidson to Sell
    Posted by on September 27th, 2006 at 10:18 am

    From BW:

    We continue to like Harley’s strong brand and market leadership. Also, we expect more dividend hikes and stock repurchases as the company utilizes free cash flow. However, in our view, based on our EPS estimates for 2006 and 2007, the stock is now at ample p-e premiums of 10% and 12% to the S&P 500, respectively. Also, we have some concern that an aging U.S. population will limit longer-term domestic motorcycle sales. Based on our discounted cash-flow model, we are keeping our 12-month target price at $62.

    By my math, Harley (HOG) is going for 15.77 times next year’s earnings ($65.64/$4.16), and the S&P 500 is going for 14.06 times 2007’s earnings (1336.18/95.04). That works out to a premium of 12.2%.

  • The Butler and Insider Trading
    Posted by on September 27th, 2006 at 9:13 am

    The New York Times reports on an insider trading case. It turns out, the butler did it.

    On Aug. 11 and Aug. 12, 2004, Mr. Sillerman’s Manhattan office faxed documents on the buyout to the poolside office of his home in Southampton, including a draft press release and, later, a written consent form. “As the house manager,” the complaint says, Mr. Lefford “managed the day-to-day affairs” of the house and performed other services “traditionally done by a butler.” As such, he handled confidential business documents for Mr. Sillerman.
    On Aug. 12 at 10:20 a.m., Mr. Lefford faxed over the signature page of the consent agreement to Mr. Sillerman’s Manhattan office. Twelve minutes later, according to the complaint, Mr. Lefford bought 5,000 shares of Sports Entertainment stock, which traded on the over-the-counter bulletin board, through a brokerage firm account he held with his wife. He paid 12 cents a share.
    When the three-way deal was announced on Dec. 16, 2004, Sports Entertainment’s stock price rose to $6.41 a share. Mr. Lefford sold his holdings a few days later at prices ranging from $9.25 to $10.50 a share.

  • Cause & Effect
    Posted by on September 26th, 2006 at 10:24 pm

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    Modesty naturally prevents me from claiming sole credit for TER*. Other factors may deserve some attention.
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    * The Elfenbein Rally