I think this is an area I have been missing out so far- but no longer!
Telefonica S.A (TEF)
Yield: 5.47% 30% div growth rate 31% payout ratio
Beta: .81 PE: 10.48 PB: 3.9 (std not tang) Analysts: 2.0
Vodafone Group Plc (VOD)
Yield: 8.04%, 27% growth rate, !132% payout ratio red flag
Beta: PE: 22.43 PB: 6.2 (.81 std) Analysts: 1.6??
TU/TSE/T.To Telus *** (confusing, voting and nonvoting shares not sure I get it)
Yield: 6%, 25% growth, 56% payout ratio
Beta: .99 PE: 9.72 PB: 1.39 (std) Analysts: 2.53
BCE
Yield: 6.45% growth rate: ? cut last year makes this show negative, in reality- approx 10%? payout: 81%
Beta: .98 PE: 18.4 PB: 4.21 (1.4) Analysts: 2.55
T (AT&T)
Yield: 6.47 3% growth rate 80% payout
Beta: .66 PE:12.96 PB:1.53(std) Analysts: 2.12
VZ Verizon
Yield: 5.93 3% growth, 86% payout
Beta: .62 PB: 14.63 PE: 2.07 ANALYSTS: 2.18
FTE France Telecom S.A.
6.67%, recent cut, 90% payout
Beta: .63 PE: 11.54 PB:1.55 (std) ANALYSTS: 3
TI Telecom Italia SpA
4.22% yield, recent cut, 90% payout
Beta: .92 PE: 10.73 PB: .79 (std)ANALYSTS: 3.5
From payout and PE ratios, I am liking TU/TSE:T/T.To and TEF initial. VOD confuses me as it as a ridiculous payout ratio but a good analyst rating. AT&T seems like a stable, if somewhat boring, bet.
Now, chart time!
3mo: TEF, TU, TI and BCE outperform. VZ and T flat.
6mo: TEF outperforms. TSE under performs- TU does not do as poorly.
1yr: BCE drops like a stone, recovers some but still under performs. Most telecom companies do not fall as much as the S&P- thus not many have outperformed recently. Again TEF performs quite well. TI also outperforms, but rather jumpily.
5yr: TU/TSE outperforms initially, then slumps. TEF does the same, but recovers faster. VZ seems to under perform, as does TI.
TEF and TU seem to look rather good on the charts as well as on the ratios. T seems to trace the market for the most part- which isn't bad considering the dividend. I am not sure what the draw for VOD is- I see nothing to make me believe its 2.0 analyst rating.
I think I will add 15k TEF and TU positions, as well as a T position. However, I think I am going to look at technicals a bit and try to time it a bit better this time.
Thursday, August 13, 2009
Wednesday, August 5, 2009
Financials Again
Time to jump back into banking and the like, as this is where the real dividends are anyway. I was a bit scared to earlier, but I suppose its time to take another look. Last time there were a few names I tossed about at the end, so lets start with those.
AFL Aflac *****
2.81% yield, 20%+ growth, 41% payout ratio
Beta: 1.78 PE: 15.81 PB: 2.93 ANALYSTS: 2.29
BNS Bank of Nova Soctia
4.22% yield, 18%+ growth (recent cuts), 68% payout ratio
Beta: 1.29 PE: 16.12 PB: 2.42 ANALYSTS:3.14
Some I rejected before but I'll give another look:
BBT Financial Holding Company (div cut but yield still reasonable)
2.54% yield, 14% growth rate, 43% payout ratio
Beta: 1.55 PE: 13.16 (Google) PB: ? ANALYSTS:none
CINF Cincinnati Financial Corp ***** (no cut?)
6.24% yield, 11% growth, 50% payout ratio
Beta: .72 PE:9.09 PB:1.05 ANALYSTS:3.0 --These ratios look attractive!
MMM 3M Company *****
2.83% yield, 8.6% growth, 50% payout
Beta: .77 PE: 17.82 PB: 21.18! (to tangible- I normally use)/ 4 PB standard ANALYSTS:2.06
AXP American Express ***
2.51% yield, 14% growth, 51% payout
Beta:2.07 PE: 20.25 PB: 2.54 ANALYSTS: 3.06
add a few new ones
AEA Advance America, Cash Advance Centers
4.54% yield, -20% growth (cuts), 60% payout
Beta: 3.3 PE:8.8 PB: 6! (1.8 standard) ANALYSTS: 3 looks risky
DOM Dominion Resources Black Warrior Trust
8.72% yield, 11.45% growth (seems a bit high with cuts), 100%payout (it's a trust)
Beta: .59 PE: 5.22 PB:6! ANALYSTS:?
This thing looks more like a bond- all money out as divs.
I should check to see if any of these companies have preferred shares, as most financial companies will. Initially, I am liking the look of AFL, and I think DOM is probably good if it has some appreciation on top of its dividend. MMM's PB worries me somewhat, but the good analyst rating soothes me. BNS and AXP seem to have good dividend growth rates.
Time to bust out the charts:
3mo: MMM, AFL, AEA, BNS outperform, BBT and DOM lag.
6mo: All but DOM and CINF outperform. AEA, BNS, AXP, and AFL do the best.
1yr: MMM,AEA,BNS,CINF outperform.
5yr: BNS, MMM, AFL outperform.
Well, BNS, MMM, and AFL have accounted for themselves rather well across the board. Recently, AEA has been recovering rather well from a large hit over the last year and AXP has recovered a bit as well. CINF and DOM don't seem to preform very admirably. I think I will delve into the financials of the first 5 mentioned companies in this paragraph.
BNS: 1/4th drop in income! Again about a 3yr setback in terms of EPS. Again, large jump in assets as well as liabilities, mostly 'other' liabilities- not a huge portion of debt.
MMM: 1/6th drop in income, rise in EPS? Drop in shares outstanding? Jump in debt, and other liabilities.
AFL: Operating income down the last year due to larger increase in expenses than income. About a 3yr setback in terms of EPS. Drop in cash, jump in long term assets. Similar (large!) jump in liabilities.
AEA: 2 years of falling operating income, expenses actually dropped last year. Assets dropped while liabilities rose by about the same amount. The market has punished it alot for this, but has it punished it enough? I am a bit more hesitant now.
AXP: Operating income almost cut in half over the last year. Assets and liabilities both dropped by about the same amount. AXP has also taken alot of punishment, but was it enough?
I like AFL, BNS, and MMM. I feel that perhaps AEA and AXP have done their recovery and now will be flat for a while longer. Both had been underperformed before the crash, so maybe I will leave them alone for now. I will add 20k positions in these three companies.
Edit: I lost 4% on BNS on day one: I really need to look at technical signals before buying in, as well as buy in in steps rather than all at once.
AFL Aflac *****
2.81% yield, 20%+ growth, 41% payout ratio
Beta: 1.78 PE: 15.81 PB: 2.93 ANALYSTS: 2.29
BNS Bank of Nova Soctia
4.22% yield, 18%+ growth (recent cuts), 68% payout ratio
Beta: 1.29 PE: 16.12 PB: 2.42 ANALYSTS:3.14
Some I rejected before but I'll give another look:
BBT Financial Holding Company (div cut but yield still reasonable)
2.54% yield, 14% growth rate, 43% payout ratio
Beta: 1.55 PE: 13.16 (Google) PB: ? ANALYSTS:none
CINF Cincinnati Financial Corp ***** (no cut?)
6.24% yield, 11% growth, 50% payout ratio
Beta: .72 PE:9.09 PB:1.05 ANALYSTS:3.0 --These ratios look attractive!
MMM 3M Company *****
2.83% yield, 8.6% growth, 50% payout
Beta: .77 PE: 17.82 PB: 21.18! (to tangible- I normally use)/ 4 PB standard ANALYSTS:2.06
AXP American Express ***
2.51% yield, 14% growth, 51% payout
Beta:2.07 PE: 20.25 PB: 2.54 ANALYSTS: 3.06
add a few new ones
AEA Advance America, Cash Advance Centers
4.54% yield, -20% growth (cuts), 60% payout
Beta: 3.3 PE:8.8 PB: 6! (1.8 standard) ANALYSTS: 3 looks risky
DOM Dominion Resources Black Warrior Trust
8.72% yield, 11.45% growth (seems a bit high with cuts), 100%payout (it's a trust)
Beta: .59 PE: 5.22 PB:6! ANALYSTS:?
This thing looks more like a bond- all money out as divs.
I should check to see if any of these companies have preferred shares, as most financial companies will. Initially, I am liking the look of AFL, and I think DOM is probably good if it has some appreciation on top of its dividend. MMM's PB worries me somewhat, but the good analyst rating soothes me. BNS and AXP seem to have good dividend growth rates.
Time to bust out the charts:
3mo: MMM, AFL, AEA, BNS outperform, BBT and DOM lag.
6mo: All but DOM and CINF outperform. AEA, BNS, AXP, and AFL do the best.
1yr: MMM,AEA,BNS,CINF outperform.
5yr: BNS, MMM, AFL outperform.
Well, BNS, MMM, and AFL have accounted for themselves rather well across the board. Recently, AEA has been recovering rather well from a large hit over the last year and AXP has recovered a bit as well. CINF and DOM don't seem to preform very admirably. I think I will delve into the financials of the first 5 mentioned companies in this paragraph.
BNS: 1/4th drop in income! Again about a 3yr setback in terms of EPS. Again, large jump in assets as well as liabilities, mostly 'other' liabilities- not a huge portion of debt.
MMM: 1/6th drop in income, rise in EPS? Drop in shares outstanding? Jump in debt, and other liabilities.
AFL: Operating income down the last year due to larger increase in expenses than income. About a 3yr setback in terms of EPS. Drop in cash, jump in long term assets. Similar (large!) jump in liabilities.
AEA: 2 years of falling operating income, expenses actually dropped last year. Assets dropped while liabilities rose by about the same amount. The market has punished it alot for this, but has it punished it enough? I am a bit more hesitant now.
AXP: Operating income almost cut in half over the last year. Assets and liabilities both dropped by about the same amount. AXP has also taken alot of punishment, but was it enough?
I like AFL, BNS, and MMM. I feel that perhaps AEA and AXP have done their recovery and now will be flat for a while longer. Both had been underperformed before the crash, so maybe I will leave them alone for now. I will add 20k positions in these three companies.
Edit: I lost 4% on BNS on day one: I really need to look at technical signals before buying in, as well as buy in in steps rather than all at once.
Friday, July 3, 2009
Now, how about some raw materials/commodities/whathave you
I guess I don't really have much basic industry that, ya know, makes tangible things like metals at the moment. I started off with some oil and steel companies, and now I think I'm going to toss in some mining/ raw materials companies. I'm just going to toss out a few to start looking at:
GNI Great Northern Iron Ore
8.4% yield, 8% growth -- 80-90% payout? ;/
Beta: .43 PE:6.35 PB: 10.02 Analysts : none
WTR Aqua America Inc.
3.1% yield ****, ~5% growth rate 66% payout
Beta: .17 PE:24 PB:2.41 Analysts: 1.5
^the above info is a little old
CWCO Consolidated Water Co
1.4% yield 5% ish growth 50% payout
Beta: 1.75 PE:? PB:2.2 ANALYSTS: 2.25
DOW The Dow Chemical Company
3% yield, 7-8% growth ?90% payout
Beta: 2.26 PE:? PB:2 ANALYSTS: 3.17
MON Monsanto Company
1.3% Yield *** 20+% growth rate- but is it sustainable? 40% payout so probably
Beta:.75 PE:21.5 PB:7.3 ANALYSTS: 2.07
APD Air Products and Chemicals, Inc.
2.4% Yield *****, 10% growth rate 60% payout
Beta:1.16 PE: 23.4 PB:4 ANALYSTS: 1.82
KMB Kimberly-Clark Corporation
4.1 ***** 7% growth rate 60% payout
Beta:.47 PE: 15 PB:? ANALYSTS: 2.36
TRA Terra Industries Inc.
1.4% yield, recently reinstated dividends 10% payout??
Beta:.99 PE:6.7 PB:2.4 ANALYSTS: 2.0
DD Dupont
5.4 % yield, 3% growth Unsustainable payout ratio? 200%?
Beta:1.41 PE:43 PB:10 ANALYSTS: 2.5 Ick not great ratios
ABX Barrick Gold Corporation
1.2% yield, 10% growth, 55% payout
Beta:.59 PE:46 PB:2.9 ANALYSTS: 2.0
I think I am going to throw Dupont right out the window now, as although they yield is attractive, not much else is. Now, to chart the others.
In the short run (3 Mo), DOW has done quite well, but it was brutalized over the last year. WTR has not done too well in the short term.
Over a year, WR, KMB,CWCO have outperformed, as well as GNI (slightly). CWCO recovered from heavy losses last year.
Over 5 yrs, ABX, APD, CWCO and WTR have outperformed, and only KMB and DOW have significantly underperformed.
I feel that DOW may outperform in the short term to catch up to the market as a whole, but I do not see any evidence that it will continue to outperform in the long run. GNI seems to follow the market, but that is fine when you are also getting an 8% yield.
My initial inclination is towards GNI, CWCO, WTR, APD, and ABX. Time to look at financial statements.
I didn't see anything too glaring- general uptrend in total equity, no huge jumps in liabilities, although GNI did pick up a reasonable amount for such a small company.
Lets just toss 10k into each. What the heck. Next time hopefully I will add some more financial assets, as I am a bit less skittish about them now.
GNI Great Northern Iron Ore
8.4% yield, 8% growth -- 80-90% payout? ;/
Beta: .43 PE:6.35 PB: 10.02 Analysts : none
WTR Aqua America Inc.
3.1% yield ****, ~5% growth rate 66% payout
Beta: .17 PE:24 PB:2.41 Analysts: 1.5
^the above info is a little old
CWCO Consolidated Water Co
1.4% yield 5% ish growth 50% payout
Beta: 1.75 PE:? PB:2.2 ANALYSTS: 2.25
DOW The Dow Chemical Company
3% yield, 7-8% growth ?90% payout
Beta: 2.26 PE:? PB:2 ANALYSTS: 3.17
MON Monsanto Company
1.3% Yield *** 20+% growth rate- but is it sustainable? 40% payout so probably
Beta:.75 PE:21.5 PB:7.3 ANALYSTS: 2.07
APD Air Products and Chemicals, Inc.
2.4% Yield *****, 10% growth rate 60% payout
Beta:1.16 PE: 23.4 PB:4 ANALYSTS: 1.82
KMB Kimberly-Clark Corporation
4.1 ***** 7% growth rate 60% payout
Beta:.47 PE: 15 PB:? ANALYSTS: 2.36
TRA Terra Industries Inc.
1.4% yield, recently reinstated dividends 10% payout??
Beta:.99 PE:6.7 PB:2.4 ANALYSTS: 2.0
DD Dupont
5.4 % yield, 3% growth Unsustainable payout ratio? 200%?
Beta:1.41 PE:43 PB:10 ANALYSTS: 2.5 Ick not great ratios
ABX Barrick Gold Corporation
1.2% yield, 10% growth, 55% payout
Beta:.59 PE:46 PB:2.9 ANALYSTS: 2.0
I think I am going to throw Dupont right out the window now, as although they yield is attractive, not much else is. Now, to chart the others.
In the short run (3 Mo), DOW has done quite well, but it was brutalized over the last year. WTR has not done too well in the short term.
Over a year, WR, KMB,CWCO have outperformed, as well as GNI (slightly). CWCO recovered from heavy losses last year.
Over 5 yrs, ABX, APD, CWCO and WTR have outperformed, and only KMB and DOW have significantly underperformed.
I feel that DOW may outperform in the short term to catch up to the market as a whole, but I do not see any evidence that it will continue to outperform in the long run. GNI seems to follow the market, but that is fine when you are also getting an 8% yield.
My initial inclination is towards GNI, CWCO, WTR, APD, and ABX. Time to look at financial statements.
I didn't see anything too glaring- general uptrend in total equity, no huge jumps in liabilities, although GNI did pick up a reasonable amount for such a small company.
Lets just toss 10k into each. What the heck. Next time hopefully I will add some more financial assets, as I am a bit less skittish about them now.
Friday, March 6, 2009
Time to Balance Out the Crazyness
Okay, so maybe I should add something sane to the portfolio, like say, consumer staples. The speculative plays turned out to be a good exercise in market timing, and the portfolio is back in the green, and the market is perhaps a bit high on a bear market rally, so I should add something that is stable and won't kill me if the market heads back down. Some of this data is a few days old now, but oh well, I don't want to go back and look up the ratios again.
WMT walmart 2.19% ***** hi div growth PE 14.46 PB 3.8 Beta: .21 ANALYSTS:1.83 mod buy
CL colgate 3.08% ***** growth PE 16.02 PB ?16 Beta .6 ANALYSTS: 2.07 outperform
PG proctor/gamble 3.45 ***** growth PE 12.84 PB ?2.27 Beta .63 ANALYSTS:2.53
KFT kraft 5.24 *** growth PE 18.12 PB 1.45 Beta .66 ANALYSTS: 2.47
CAG con-agra 5.21 3 yrs ago cut PE 13.55 PB 14.43 Beta .68 ANALYSTS: 3
DD Dupont 7.64 slow growth PE 8.29 PB 7.21 Beta 1.19 ANALYSTS: 2.5
PEP pepsi 3.48 *****
16/20 3/5yr div growth, 50% payout ratio, 39% ave 5 yr
PE 14.86 PB 14.46 Beta .58 ANALYSTS:2 outperform
KO Coca-Cola 3.9 *****
10.6/11.1 div growth rate 3/5 yr 60% payout ratio average 5 yr 55%
PE 16.76 PB 12.1 Beta .57 ANALYSTS: 1.92 outpreform
CVS caremark 1.15 growth recently PE 12.07 PB 1.15 Beta .81 ANALYSTS: 1.62 mod buy
GIS *** 3.65 steady growth PE 14.73 PB 3.32 Beta .35 ANALYSTS: 1.82 mod buy
7.1/8.04 3/5 yr div growth, 45% payout ratio average 5yr 43% 5yr ave yield 2.5%
K 3.72 growth PE 12.41 PB 9.76 Beta .45 ANALYSTS: 1.8 mod buy
14/7.8 3/5 yr growth, 54% payout ratio, average 5 yr 47% 5yr ave yield 2.6%
At some point I started using PB instead of Tangible PB, which has skewed these numbers a bit. I decided that since some did not list a tangible PB I would just use the PB value... but some of these are tangible values (the high ones) and I am too lazy to go back and change them... so there. I stated out PEP, KO, GIS, and K a bit more than normal because I wanted to be able to compare them, i only want one cereal company and one cola company.
Oh, and on a side note I would like to add a position in MMM if it looks viable. I had been looking at MMM and GE as two large conglomerates, and MMM certainly looks more appealing than GE at the moment (no dividend cut!).
MMM 4.1% yield ***** 6% 3yr div growth rate
PE 10.07 PB 3.45 Beta .63 ANALYSTS: 2.6 hold
So, most of these companies above are rather big names, and that is good! Hopefully I won't have to worry too much about shooting myself in the foot here.
Okay, so, 1yr chart. Everyone outperforms, especially WMT and KFT. There is one exception: DD gets the stuffing kicked out of it. I should probably look into that.
6months: ditto, KO better than kraft, closer grouping (less time to spread).
5yr chart: a bit more interesting, only GIS, PEP, and K seem to outperform consistently.
I looked into DD's financial statements: I bet the fact that they had a rather negative EPS last quarter accounts for the large stock price pummeling. Also, large jump in other liabilities and large drop in other equity- I think I'll stay away from that one as I'm not sure whats going on.
I think I will take GIS and PEP based on payout ratios, long term div growth, and the 5 yr chart. I also like KFT and WMT. PG and CL also seem to have preformed well. I have mixed feelings about CAG, as it has high yields but it seems to track the market, not beat it. With a 5% yield however, I guess that may be acceptable.
This is the first list I made where I didn't immediatly see lots of problems to throw out! I think just start small 10k positions in PEP,GIS,KFT,WMT,PG, and CL. That should provide some stability to compensate for the shipping and real estate segments of the portfolio.
Oh... what about MMM? It's chart doesn't look very impressive over the last few years, although it preformed well several years back, making the ten year chart look good. It has been paying dividends forever however... but it doesn't grow them very fast or normally have a very high yield. I guess I just don't see much motivation for out performance, it will probably recover with the market as a whole.
Okay, next time maybe I will make an update on what positions are held and their profit status. Or maybe not. I dunno.
Remember: I don't know jack about investing don't base any decisions on my nonsense!
WMT walmart 2.19% ***** hi div growth PE 14.46 PB 3.8 Beta: .21 ANALYSTS:1.83 mod buy
CL colgate 3.08% ***** growth PE 16.02 PB ?16 Beta .6 ANALYSTS: 2.07 outperform
PG proctor/gamble 3.45 ***** growth PE 12.84 PB ?2.27 Beta .63 ANALYSTS:2.53
KFT kraft 5.24 *** growth PE 18.12 PB 1.45 Beta .66 ANALYSTS: 2.47
CAG con-agra 5.21 3 yrs ago cut PE 13.55 PB 14.43 Beta .68 ANALYSTS: 3
DD Dupont 7.64 slow growth PE 8.29 PB 7.21 Beta 1.19 ANALYSTS: 2.5
PEP pepsi 3.48 *****
16/20 3/5yr div growth, 50% payout ratio, 39% ave 5 yr
PE 14.86 PB 14.46 Beta .58 ANALYSTS:2 outperform
KO Coca-Cola 3.9 *****
10.6/11.1 div growth rate 3/5 yr 60% payout ratio average 5 yr 55%
PE 16.76 PB 12.1 Beta .57 ANALYSTS: 1.92 outpreform
CVS caremark 1.15 growth recently PE 12.07 PB 1.15 Beta .81 ANALYSTS: 1.62 mod buy
GIS *** 3.65 steady growth PE 14.73 PB 3.32 Beta .35 ANALYSTS: 1.82 mod buy
7.1/8.04 3/5 yr div growth, 45% payout ratio average 5yr 43% 5yr ave yield 2.5%
K 3.72 growth PE 12.41 PB 9.76 Beta .45 ANALYSTS: 1.8 mod buy
14/7.8 3/5 yr growth, 54% payout ratio, average 5 yr 47% 5yr ave yield 2.6%
At some point I started using PB instead of Tangible PB, which has skewed these numbers a bit. I decided that since some did not list a tangible PB I would just use the PB value... but some of these are tangible values (the high ones) and I am too lazy to go back and change them... so there. I stated out PEP, KO, GIS, and K a bit more than normal because I wanted to be able to compare them, i only want one cereal company and one cola company.
Oh, and on a side note I would like to add a position in MMM if it looks viable. I had been looking at MMM and GE as two large conglomerates, and MMM certainly looks more appealing than GE at the moment (no dividend cut!).
MMM 4.1% yield ***** 6% 3yr div growth rate
PE 10.07 PB 3.45 Beta .63 ANALYSTS: 2.6 hold
So, most of these companies above are rather big names, and that is good! Hopefully I won't have to worry too much about shooting myself in the foot here.
Okay, so, 1yr chart. Everyone outperforms, especially WMT and KFT. There is one exception: DD gets the stuffing kicked out of it. I should probably look into that.
6months: ditto, KO better than kraft, closer grouping (less time to spread).
5yr chart: a bit more interesting, only GIS, PEP, and K seem to outperform consistently.
I looked into DD's financial statements: I bet the fact that they had a rather negative EPS last quarter accounts for the large stock price pummeling. Also, large jump in other liabilities and large drop in other equity- I think I'll stay away from that one as I'm not sure whats going on.
I think I will take GIS and PEP based on payout ratios, long term div growth, and the 5 yr chart. I also like KFT and WMT. PG and CL also seem to have preformed well. I have mixed feelings about CAG, as it has high yields but it seems to track the market, not beat it. With a 5% yield however, I guess that may be acceptable.
This is the first list I made where I didn't immediatly see lots of problems to throw out! I think just start small 10k positions in PEP,GIS,KFT,WMT,PG, and CL. That should provide some stability to compensate for the shipping and real estate segments of the portfolio.
Oh... what about MMM? It's chart doesn't look very impressive over the last few years, although it preformed well several years back, making the ten year chart look good. It has been paying dividends forever however... but it doesn't grow them very fast or normally have a very high yield. I guess I just don't see much motivation for out performance, it will probably recover with the market as a whole.
Okay, next time maybe I will make an update on what positions are held and their profit status. Or maybe not. I dunno.
Remember: I don't know jack about investing don't base any decisions on my nonsense!
Thursday, March 5, 2009
Even More Speculation
Okay, might as well buy some REIT's while I'm buying things that have had the crap beaten out of them.
HPT 33% - div higher than EPS expect cut to about 5% yield
PE 8.66 PB .35 Beta 1.5 ANALYSTS: 2 Outperform Market Cap:853M
NRF 72%! Expect cut!? Looks like they sold something big off to pay down debt? Abnormally large EPS and drop in liabilities?...
PE .11!! PB .05!! Beta 1.85 ANALYSTS: 2.57 hold Market Cap: 87M
UHT 9.54% (saneish- still probably will be halved... low EPS)
PE 19.98! PB 2.16 Beta .72! ANALYSTS: none Market Cap: 307M
O 10.88% (again div above EPS-halved?)PE 18.27 PB 1.15 Beta .97
ANALYSTS:2.58 hold Market Cap: 1.6B
IRC 16% again div>EPS expect drop to 5%ish PE 13.75 PB 1.4 Beta 1.28
ANALYSTS: 2.75 hold Market Cap:406M
My initial impulse is to take the stocks that have managed to retain a reasonable PE ratio, as the market knows more than I do about RIETS. Prehaps I should just look into an ETF for this... but why do that when it's not real money anyhow!
Charts!
6months: O and UHT outperformed. NRF was beasted.
2yr: Again O and UHT outperform. NRF and HPT get decimated.
Well, the charts and the ratios give me a good feeling about O and UHT. HPT has a good analyst recommendation and is not exactly a lightweight with its 800M market cap, so I'm tempted to say its too big to fail- but I haven't actually looked into that at all so I can't! They did recently beat expectations and post a rise in 4th quarter profits however. I suppose I don't really have any better ideas for RIETs and am too lazy to look around. I'll toss 10k at each of these and I can fill out the rest of my RIET position later. I just want to get a toehold in while the market is going to heck.
EDIT: I found one more nice looking candidate.
ESS 7.47% raised dividend, dividend achiever, still a bit low EPS however
PE 26 PB 1.5 Beta 1.08 Analysts 2.2 outperform
On the chart it outperformed until recently, where it took a beating. Ratios seem strong and dividend increase is a good sign. I think I will buy in a 10k position here as well.
HPT 33% - div higher than EPS expect cut to about 5% yield
PE 8.66 PB .35 Beta 1.5 ANALYSTS: 2 Outperform Market Cap:853M
NRF 72%! Expect cut!? Looks like they sold something big off to pay down debt? Abnormally large EPS and drop in liabilities?...
PE .11!! PB .05!! Beta 1.85 ANALYSTS: 2.57 hold Market Cap: 87M
UHT 9.54% (saneish- still probably will be halved... low EPS)
PE 19.98! PB 2.16 Beta .72! ANALYSTS: none Market Cap: 307M
O 10.88% (again div above EPS-halved?)PE 18.27 PB 1.15 Beta .97
ANALYSTS:2.58 hold Market Cap: 1.6B
IRC 16% again div>EPS expect drop to 5%ish PE 13.75 PB 1.4 Beta 1.28
ANALYSTS: 2.75 hold Market Cap:406M
My initial impulse is to take the stocks that have managed to retain a reasonable PE ratio, as the market knows more than I do about RIETS. Prehaps I should just look into an ETF for this... but why do that when it's not real money anyhow!
Charts!
6months: O and UHT outperformed. NRF was beasted.
2yr: Again O and UHT outperform. NRF and HPT get decimated.
Well, the charts and the ratios give me a good feeling about O and UHT. HPT has a good analyst recommendation and is not exactly a lightweight with its 800M market cap, so I'm tempted to say its too big to fail- but I haven't actually looked into that at all so I can't! They did recently beat expectations and post a rise in 4th quarter profits however. I suppose I don't really have any better ideas for RIETs and am too lazy to look around. I'll toss 10k at each of these and I can fill out the rest of my RIET position later. I just want to get a toehold in while the market is going to heck.
EDIT: I found one more nice looking candidate.
ESS 7.47% raised dividend, dividend achiever, still a bit low EPS however
PE 26 PB 1.5 Beta 1.08 Analysts 2.2 outperform
On the chart it outperformed until recently, where it took a beating. Ratios seem strong and dividend increase is a good sign. I think I will buy in a 10k position here as well.
More Speculation
So, the market is abysmal at the moment. That of course means a huge buy signal to me, as I am not even using real money. I might as well pick some really beaten down speculative areas while I am at it: how about shipping companies?
Shipping first for starters:
GMR 28%!, PE 10.29 PB -- Beta 1.19 Market Cap: 447M
2 yrs at 50c/quarter - high payout ratio? ANALYSTS 2.57
KSP 20%! PE 13.07 PB 1.08 Beta .5! Market Cap: 222M ANALYSTS: 1.43 mod buy!
4 year dividend history with no major cuts
NAT 22%! PE 6.89 PB 1.13 Beta .95 Market Cap: 891M ANALYSTS:3.3 hold/underpref
History of reasonable but changing dividends
SFL 9.23% PE 13.15 PB 1.02 Beta 1.62! Market Cap:7.8B! ANALYSTS:2.5 outpref/hold
reasonable history of dividend payouts- ship financing company for FRO I believe
DAC 58%! PE 1.53 PB .37 Beta .6! Market Cap: 210M
ANALYSTS:2.5 outpref/hold debt/assets about 1:1
PRGN 65%! PE 1.38 PB .3 Beta .46! Market Cap: 93M ANALYSTS:2 outperform
1yr of constant dividend
DHT 23%! PE 4.03 PB 1.2 Beta .85 Market Cap: 163M ANALYSTS: 1.67 mod buy!
3yrs fluctuating dividend
ESEA 10.64% PE 5.34 PB .48 Beta: .02? impossible! Market Cap: 126M
ANALYSTS:1.67 mod buy! recent cut but still reasonable yield- no more cuts?
VLCCF 9.02% PE 4.29 PB .93 Beta:1.35 Market Cap: 206M ANALYSTS: 3 hold
recent cuts, still reasonable yield - worrysome dividend shrinkage
So, lots of very low PE and PB's. Either these are steal opportunity values, or the market doesn't see them making much growth in the future. Also, lots of absurdly high dividend yields that we can probably expect to be cut- at the same time however, I doubt the earnings per share have taken as large a hit as the share price has, so more dividend may be supportable than the percentage indicates. Initially, I am biased towards the lower yields and higher market caps. Also, I wonder about those stocks with betas less than one... that seems unlikely.
6month chart: NAT and KSP outpreform. DAC and PRGN get annihilated.
5yr: SLF,NAT,VLCCF outpreform GMR preforms well until recently.
KSP and NAT's low betas seem justified. SLF's high beta seems unjustified. DAC and PRGN's low betas seem preposterous.
So I'm thinking the shotgun approach is what we want in this turbulent market. How about we just grab GMR,NAT,SLF,VLCCF, and KSP. That should give us a good toehold. 10k of each? Sounds like a start. I'm feeling too lazy to look into financials tonight- if it was real money I would, but if it was real money I would research a heck of a lot harder on each.
Shipping first for starters:
GMR 28%!, PE 10.29 PB -- Beta 1.19 Market Cap: 447M
2 yrs at 50c/quarter - high payout ratio? ANALYSTS 2.57
KSP 20%! PE 13.07 PB 1.08 Beta .5! Market Cap: 222M ANALYSTS: 1.43 mod buy!
4 year dividend history with no major cuts
NAT 22%! PE 6.89 PB 1.13 Beta .95 Market Cap: 891M ANALYSTS:3.3 hold/underpref
History of reasonable but changing dividends
SFL 9.23% PE 13.15 PB 1.02 Beta 1.62! Market Cap:7.8B! ANALYSTS:2.5 outpref/hold
reasonable history of dividend payouts- ship financing company for FRO I believe
DAC 58%! PE 1.53 PB .37 Beta .6! Market Cap: 210M
ANALYSTS:2.5 outpref/hold debt/assets about 1:1
PRGN 65%! PE 1.38 PB .3 Beta .46! Market Cap: 93M ANALYSTS:2 outperform
1yr of constant dividend
DHT 23%! PE 4.03 PB 1.2 Beta .85 Market Cap: 163M ANALYSTS: 1.67 mod buy!
3yrs fluctuating dividend
ESEA 10.64% PE 5.34 PB .48 Beta: .02? impossible! Market Cap: 126M
ANALYSTS:1.67 mod buy! recent cut but still reasonable yield- no more cuts?
VLCCF 9.02% PE 4.29 PB .93 Beta:1.35 Market Cap: 206M ANALYSTS: 3 hold
recent cuts, still reasonable yield - worrysome dividend shrinkage
So, lots of very low PE and PB's. Either these are steal opportunity values, or the market doesn't see them making much growth in the future. Also, lots of absurdly high dividend yields that we can probably expect to be cut- at the same time however, I doubt the earnings per share have taken as large a hit as the share price has, so more dividend may be supportable than the percentage indicates. Initially, I am biased towards the lower yields and higher market caps. Also, I wonder about those stocks with betas less than one... that seems unlikely.
6month chart: NAT and KSP outpreform. DAC and PRGN get annihilated.
5yr: SLF,NAT,VLCCF outpreform GMR preforms well until recently.
KSP and NAT's low betas seem justified. SLF's high beta seems unjustified. DAC and PRGN's low betas seem preposterous.
So I'm thinking the shotgun approach is what we want in this turbulent market. How about we just grab GMR,NAT,SLF,VLCCF, and KSP. That should give us a good toehold. 10k of each? Sounds like a start. I'm feeling too lazy to look into financials tonight- if it was real money I would, but if it was real money I would research a heck of a lot harder on each.
Wednesday, January 21, 2009
Financials
So, first I should clear up what I spent of the fake fund's money. I spent 20k on XOM and 10k on CEO,SSL,CVX. I also added a bit (4k and 2k) of VE and NUE as they had fallen a bit underweight, and I figured it was a good time to scoop up some more. I'm starting to wonder if SSL and CEO spent too hard expanding while oil was high, but we'll see.
So, after RBS dropped hugely in share price and dragged the rest of the financial down, I decided it would be a great time to grab some bank stocks. However, I was slow and wanted to actually do some research- in retrospect it would have been great if I had just picked up some JPM and then sold it again, but this isn't a day trading fund. And it isn't for a reason: I tried a bit of day trading in another fake account, and I always seem to jump the gun and get soaked before things recover (Ex: I bought WFC & AIB! in my fake trade account a few days back to watch it drop 15%-50% oops? :( ). Anyhow, I'll try not to do that with this account.
Now they are right back down again anyhow, silly dead cat bounce. I hope I'm not jumping into a storm of falling knives with this. Heck, my finance Prof. told me I should stay away from banks for now, but hey, if I'm going to add a financial portion anyhow it might as well be when the market is beaten down... right? Maybe I'm just reassuring myself, we'll see. I probably wouldn't do this with real money. Maybe I should make a rule to only do things I would do with real money....
Okay, so financial companies. They all look scary :(. I limited myself to companies with a long term dividend growth history, and some of the companies still look a bit scary, especially with recent quarter results.
So, what companies to consider?
AFL (AFLAC) 2.8 ***** fast growth
PE 13.4 PB 2.85 Beta .8 ANALYST RATINGS: 2.55
CINF (Cincinnati Financial Corp.)6.1***** slow/mod growth
PE 9.35 PB .89 Beta .64 ANALYST RATINGS: 2.6
STT (State Street Corp.) ***** 2.64 slowish growth
PE 8.33 PB 2.36 Beta 1.12 ANALYST RATINGS: 3
CBSH (Cash America International, Inc)***** 2.55 slowish growth
PE 15.04 PB 1.94 Beta .29 ANALYST RATINGS: 3
UCBH (United Commercial Bank Holdings, Inc.)4.2% *** growth
PE 18.36 PB .62 Beta 1.51 ANALYST RATINGS: 2.73
CB (Chubb Corp.)***** 3 decent growth
PE 8.05 PB 1.19 Beta .44 ANALYST RATINGS: 2.53
TCB (TCF Financial Corp.) **** 10%slow growth
PE 7.99 PB 1.43 Beta .48 ANALYST RATINGS: 2.72
BBT (BB&T Corp.) ***** 9% slow growth
PE 7.06 PB 1.77 Beta .47 ANALYST RATINGS: 2.96
DB (Deutsche Bank AG)*** 22%? growth
PE 5.31 PB .45 Beta 2.22 ANALYST RATINGS: 3.5
USB (U.S. Bancorp) 9.28% ***** growth
PE 9.19 PB 3.03 Beta .82 ANALYST RATINGS: 2.58
AXP (American Express Co.) *** 4% good growth
PE 5.79 PB 1.58 Beta 1.37 ANALYST RATINGS: 3.35
WFC (Wells Fargo & Co.) ***** 7.28 slow growth
PE 9.21 PB 4.49 Beta .53 ANALYST RATINGS: 2.47
and what the heck, I'll add JPM even though it's not a dividend achiever. And some Canadian Corporations just to get some distance from the U.S. financial system for comparison. However, they don't actually look as stable as I had hoped judging by the betas...
JPM (JPMorgan Chase & Co.) 6.7% slow dividend growth- was held at .34 cents/quarter for 3+ yrs and rose to .38 in 2007.
PE 23.01 PB .82 Beta .87 ANALYST RATINGS: 2.29
RY Royal Bank of Canada 5.88 fast growth for 5yrs+ (changing divs but growing yearly)
PE 11.24 PB 2.31 Beta 2.31 ANALYST RATINGS: 2.62
SLF Canadian insurer 5.42 recent small cut 5yr growth
PE 11.44 PB 1.54 Beta 1.54 ANALYST RATINGS: 2.5
BNS Bank of Nova Scotia, formerly tree stars but recent (slight) dividend cut 6.8% and previous fast dividend growth
PE 9.36 PB 1.49 Beta .54 ANALYST RATINGS: 2.79
Note: I added Beta (from Reuters) to give me some idea of volatility in addition to PE and PB, as some tings that look cheap from PB will also be crazy volatile and maybe I shouldn't try to call the bottom on a falling bank stock.
Judging from the betas, CBSH, CB, TCB, BBT, BNS, and WFC should be significantly less volatile than the market.... right. I assume that this will not hold true in the most recent of months, but maybe they will be more stable than the other corporations. I am just going to pull up a chart quick and see which of these stocks has fallen and can't get up, and which are at least trying to recover.
Crap, there are too many names to fit onto one Yahoo graph at a time. I guess I'll have to think up some way to split them but I hate not being able to visually compare everything to everything else! How about I split it into Beta >1 and Beta <1 as hopefully that will break it into very crashed and not so crashed, at least in theory.
So, first chart, B>1, should be ugly.
STT, UCBH, DB, AXP, RY, SLF
First thing that jumps out at me: STT has had a great day. +20%, while the others have gone down with the market. I wonder what the news is there?
Second thing I notice is: STT crashed hugely 2 days ago (-50%). That is what set up this rise. More news I should look into. I wonder if those ratio's I pulled up a few days back are even correct anymore :(.
Okay, 6 month chart: UCBH outperforms... why? Because it was beaten down a lot six months ago, says the 1 yr chart. RY stays close to the market on the 6 month chart, and SLF stays close on the 3 month chart. Otherwise, its just a sad, sad picture. RY actually outperformed for a tiny short while on the one year chart.
On the 5 yr chart: RY, SLF, and DB outperformed, and STT was up there for almost a year. However, DB was hit hard by the crisis as the 1 yr chart shows, and whatever recently hit STT sent it right down with DB at almost -80% for the year.
I feel that maybe I should be salivating at these marked down prices, but I'm not. I think I'll just move on, and maybe consider RY and SLF after seeing what the other companies look like.
Now, Beta<1
AFL,CINF,CBSH,TCB,BBT,USB,WFC,JPM, BNS
Today: AFL took a huge hit. Apparently, it had hybrid security exposure to European banks like RBS which just had the pants beat out of them. It's too bad, because Aflac has been a very solid outperformer- I probably would have bought in if I looked at it last week. I will keep my eye on it- maybe the market has punished them enough with the huge -36% hit, and maybe their portfolio isn't at as much risk as is claimed.
5day:2 days ago most everything opened lower, JPM and WFC especially. CINF seemed oddly immune.
1month: BNS leads the pack here- I note that RY and SLF the other Canadian financials in the Beta>1 group held up well here too.
3month: CINF leads the pack, AFL also beats the market, and CBSH is close.
6month:BBT and TCB were preforming better than the market in the October crash, but have since lost their luster as CBSH and CINF regained their losses. TCB made a bit of a recovery as well to outperform. BNS drags at the bottom.
1yr: Again, CBSH and CINF shine at the end. However, CINF was at the very bottom of the heap most of the year. WFC looked like it was doing well, until recently.
5yr: AFL was the only major outperforming stock of any mention during the period. Then it fell like a house of cards. Wheeee. On this time scale, DB,RY, and SLF looked better.
I think I am going to take a look at CBSH against RY and SLF.
CBSH has one thing going for it: it is imperturbable. The bottom falls off the market, and it doesn't really move. However, it hasn't really gone up at all either. Not exactly a huge reason to invest in something that under preforms, but with style. Case in point: on the 1 month chart, it is right back to under performing. Just because it didn't go down, doesn't really indicate it will go up. Also, they seem to do regular reverse splits 105:100, effectively eschewing a 5% growth of price from thin air. It would stink to get your dividend on 100 shares that lets you buy 1 or 2 more shares, only to lose 5 shares to a reverse split: yes,yes the share price goes up 5% so you don't really lose anything from the split, but that 5-10% dividend growth rate suddenly doesn't look so appealing when you also have 5% less shares to get dividends on each year, and the nonperformance of the stocks share price is just that much worse when you consider the reverse splits made it look as good as it does. I thought I had stumbled upon something good when I saw how solid the share price was in the recent markets, but apparently not.
Oh well, moving on. I don't really feel like buying much of this stuff. Maybe some RY and SLF. If it weren't for the recent drop in bank shares, I probably wouldn't be adding financial quite yet :(. And looking at the charts, I don't really see any strong reason to want to buy WFC and JPM, which seem to be the analyst favorites. Then again, maybe I am putting too much bias on past returns: looking at the 1yr chart again, WFC and JPM don't look atrocious, and SLF doesn't look as great.
Okay, so after looking at the one year chart I have changed my mind a bit. I think that RY, BNS and SLF had their run a while ago, and perhaps now JMP and WFC are the ones set to rise. Or, they will all continue their plunge, but whatever. I will keep RY in my list of options though, as it preformed the best of the three over the last year and five years.
I guess it's that time again: Financial Statements!
RY: Liabilities and assets are frighteningly close numbers. Picked up 2B Canadian dollars in debt this year. On the up side, it didn't pick up much debt last year, and it has previously picked up 2B debt in a year (2004) and wasn't that much the worse for it as far as I can tell. Cash on hand is up as well. There's probably a lot more I would only get out of a more in depth delving. Note that RY is not a small company: 32B market cap- so that 2B is nothing compared to what you will find on the next two statements from companies about 2-3x as big...
JPM: Big spending on loan loss prevention.... go figure. Makes net income drop stupendously. Nice huge 55B of debt and 20B of stock on the books for just the first 3 quarters...on top of 87B last year. Again with liabilities close to assets, but that actually seems normalish for banks, judging by the history.
WFC: Again, a big jump in loan loss prevention. Like 40B of debt in the first three quarters... on top of 50B picked up last year... yuck.
Hmm, well now what. I guess I should check if JPM and WFC have TARP money, wouldn't do to invest in something that the gov makes cut dividends.
Yep, they did. So there goes that idea, their dividends aren't even safe.
Conclusion: I'm going to run to Canada and add a small RY position (10k). I am SURE that most of these companies I ran through today will recover eventually, and I WANT to get in and catch some of the upside. However, at the moment I don't trust myself enough to pick a good entry point and the right companies. I will reevaluate these companies after we see what the TARP does to dividends... and I will probably miss a large chunk of upside. The charts looked hopeful to me, but the balance sheets didn't, as far as JPM and WFC went. Oh well. Maybe I should have picked up some AFLAC- but then again, as I said, this is not a day trade fund, even if it does bounce I shouldn't kick myself. AFLAC in the past has been a very solid outperformer, so I will keep my eye on what becomes of this concern over its Hybrid Securities investments: if it turns out that AFLAC is mostly unscathed, I will buy in, hopefully before all of the upside is gone.
I think companies like with solid histories of outperformance for on the decades charts and the recent 5 yr charts should be looked at again, such as:SLF,AFL, and BNS. However, I have no confidence at the moment, especially in ALF with its recent issues. I will look at financials again, and maybe a few that aren't dividend achievers (gasp!).
Usual disclaimer: I don't know jack about the markets and I don't own any stock- so don't take this stuff as any kind of reason to invest your own money.
Next time: probably a summary of how much money the fund has lost so far (groan) and maybe, I dunno, shipping companies. Might as well call bottom on the bulk rates as well as the financial markets, eh?
So, after RBS dropped hugely in share price and dragged the rest of the financial down, I decided it would be a great time to grab some bank stocks. However, I was slow and wanted to actually do some research- in retrospect it would have been great if I had just picked up some JPM and then sold it again, but this isn't a day trading fund. And it isn't for a reason: I tried a bit of day trading in another fake account, and I always seem to jump the gun and get soaked before things recover (Ex: I bought WFC & AIB! in my fake trade account a few days back to watch it drop 15%-50% oops? :( ). Anyhow, I'll try not to do that with this account.
Now they are right back down again anyhow, silly dead cat bounce. I hope I'm not jumping into a storm of falling knives with this. Heck, my finance Prof. told me I should stay away from banks for now, but hey, if I'm going to add a financial portion anyhow it might as well be when the market is beaten down... right? Maybe I'm just reassuring myself, we'll see. I probably wouldn't do this with real money. Maybe I should make a rule to only do things I would do with real money....
Okay, so financial companies. They all look scary :(. I limited myself to companies with a long term dividend growth history, and some of the companies still look a bit scary, especially with recent quarter results.
So, what companies to consider?
AFL (AFLAC) 2.8 ***** fast growth
PE 13.4 PB 2.85 Beta .8 ANALYST RATINGS: 2.55
CINF (Cincinnati Financial Corp.)6.1***** slow/mod growth
PE 9.35 PB .89 Beta .64 ANALYST RATINGS: 2.6
STT (State Street Corp.) ***** 2.64 slowish growth
PE 8.33 PB 2.36 Beta 1.12 ANALYST RATINGS: 3
CBSH (Cash America International, Inc)***** 2.55 slowish growth
PE 15.04 PB 1.94 Beta .29 ANALYST RATINGS: 3
UCBH (United Commercial Bank Holdings, Inc.)4.2% *** growth
PE 18.36 PB .62 Beta 1.51 ANALYST RATINGS: 2.73
CB (Chubb Corp.)***** 3 decent growth
PE 8.05 PB 1.19 Beta .44 ANALYST RATINGS: 2.53
TCB (TCF Financial Corp.) **** 10%slow growth
PE 7.99 PB 1.43 Beta .48 ANALYST RATINGS: 2.72
BBT (BB&T Corp.) ***** 9% slow growth
PE 7.06 PB 1.77 Beta .47 ANALYST RATINGS: 2.96
DB (Deutsche Bank AG)*** 22%? growth
PE 5.31 PB .45 Beta 2.22 ANALYST RATINGS: 3.5
USB (U.S. Bancorp) 9.28% ***** growth
PE 9.19 PB 3.03 Beta .82 ANALYST RATINGS: 2.58
AXP (American Express Co.) *** 4% good growth
PE 5.79 PB 1.58 Beta 1.37 ANALYST RATINGS: 3.35
WFC (Wells Fargo & Co.) ***** 7.28 slow growth
PE 9.21 PB 4.49 Beta .53 ANALYST RATINGS: 2.47
and what the heck, I'll add JPM even though it's not a dividend achiever. And some Canadian Corporations just to get some distance from the U.S. financial system for comparison. However, they don't actually look as stable as I had hoped judging by the betas...
JPM (JPMorgan Chase & Co.) 6.7% slow dividend growth- was held at .34 cents/quarter for 3+ yrs and rose to .38 in 2007.
PE 23.01 PB .82 Beta .87 ANALYST RATINGS: 2.29
RY Royal Bank of Canada 5.88 fast growth for 5yrs+ (changing divs but growing yearly)
PE 11.24 PB 2.31 Beta 2.31 ANALYST RATINGS: 2.62
SLF Canadian insurer 5.42 recent small cut 5yr growth
PE 11.44 PB 1.54 Beta 1.54 ANALYST RATINGS: 2.5
BNS Bank of Nova Scotia, formerly tree stars but recent (slight) dividend cut 6.8% and previous fast dividend growth
PE 9.36 PB 1.49 Beta .54 ANALYST RATINGS: 2.79
Note: I added Beta (from Reuters) to give me some idea of volatility in addition to PE and PB, as some tings that look cheap from PB will also be crazy volatile and maybe I shouldn't try to call the bottom on a falling bank stock.
Judging from the betas, CBSH, CB, TCB, BBT, BNS, and WFC should be significantly less volatile than the market.... right. I assume that this will not hold true in the most recent of months, but maybe they will be more stable than the other corporations. I am just going to pull up a chart quick and see which of these stocks has fallen and can't get up, and which are at least trying to recover.
Crap, there are too many names to fit onto one Yahoo graph at a time. I guess I'll have to think up some way to split them but I hate not being able to visually compare everything to everything else! How about I split it into Beta >1 and Beta <1 as hopefully that will break it into very crashed and not so crashed, at least in theory.
So, first chart, B>1, should be ugly.
STT, UCBH, DB, AXP, RY, SLF
First thing that jumps out at me: STT has had a great day. +20%, while the others have gone down with the market. I wonder what the news is there?
Second thing I notice is: STT crashed hugely 2 days ago (-50%). That is what set up this rise. More news I should look into. I wonder if those ratio's I pulled up a few days back are even correct anymore :(.
Okay, 6 month chart: UCBH outperforms... why? Because it was beaten down a lot six months ago, says the 1 yr chart. RY stays close to the market on the 6 month chart, and SLF stays close on the 3 month chart. Otherwise, its just a sad, sad picture. RY actually outperformed for a tiny short while on the one year chart.
On the 5 yr chart: RY, SLF, and DB outperformed, and STT was up there for almost a year. However, DB was hit hard by the crisis as the 1 yr chart shows, and whatever recently hit STT sent it right down with DB at almost -80% for the year.
I feel that maybe I should be salivating at these marked down prices, but I'm not. I think I'll just move on, and maybe consider RY and SLF after seeing what the other companies look like.
Now, Beta<1
AFL,CINF,CBSH,TCB,BBT,USB,WFC,JPM, BNS
Today: AFL took a huge hit. Apparently, it had hybrid security exposure to European banks like RBS which just had the pants beat out of them. It's too bad, because Aflac has been a very solid outperformer- I probably would have bought in if I looked at it last week. I will keep my eye on it- maybe the market has punished them enough with the huge -36% hit, and maybe their portfolio isn't at as much risk as is claimed.
5day:2 days ago most everything opened lower, JPM and WFC especially. CINF seemed oddly immune.
1month: BNS leads the pack here- I note that RY and SLF the other Canadian financials in the Beta>1 group held up well here too.
3month: CINF leads the pack, AFL also beats the market, and CBSH is close.
6month:BBT and TCB were preforming better than the market in the October crash, but have since lost their luster as CBSH and CINF regained their losses. TCB made a bit of a recovery as well to outperform. BNS drags at the bottom.
1yr: Again, CBSH and CINF shine at the end. However, CINF was at the very bottom of the heap most of the year. WFC looked like it was doing well, until recently.
5yr: AFL was the only major outperforming stock of any mention during the period. Then it fell like a house of cards. Wheeee. On this time scale, DB,RY, and SLF looked better.
I think I am going to take a look at CBSH against RY and SLF.
CBSH has one thing going for it: it is imperturbable. The bottom falls off the market, and it doesn't really move. However, it hasn't really gone up at all either. Not exactly a huge reason to invest in something that under preforms, but with style. Case in point: on the 1 month chart, it is right back to under performing. Just because it didn't go down, doesn't really indicate it will go up. Also, they seem to do regular reverse splits 105:100, effectively eschewing a 5% growth of price from thin air. It would stink to get your dividend on 100 shares that lets you buy 1 or 2 more shares, only to lose 5 shares to a reverse split: yes,yes the share price goes up 5% so you don't really lose anything from the split, but that 5-10% dividend growth rate suddenly doesn't look so appealing when you also have 5% less shares to get dividends on each year, and the nonperformance of the stocks share price is just that much worse when you consider the reverse splits made it look as good as it does. I thought I had stumbled upon something good when I saw how solid the share price was in the recent markets, but apparently not.
Oh well, moving on. I don't really feel like buying much of this stuff. Maybe some RY and SLF. If it weren't for the recent drop in bank shares, I probably wouldn't be adding financial quite yet :(. And looking at the charts, I don't really see any strong reason to want to buy WFC and JPM, which seem to be the analyst favorites. Then again, maybe I am putting too much bias on past returns: looking at the 1yr chart again, WFC and JPM don't look atrocious, and SLF doesn't look as great.
Okay, so after looking at the one year chart I have changed my mind a bit. I think that RY, BNS and SLF had their run a while ago, and perhaps now JMP and WFC are the ones set to rise. Or, they will all continue their plunge, but whatever. I will keep RY in my list of options though, as it preformed the best of the three over the last year and five years.
I guess it's that time again: Financial Statements!
RY: Liabilities and assets are frighteningly close numbers. Picked up 2B Canadian dollars in debt this year. On the up side, it didn't pick up much debt last year, and it has previously picked up 2B debt in a year (2004) and wasn't that much the worse for it as far as I can tell. Cash on hand is up as well. There's probably a lot more I would only get out of a more in depth delving. Note that RY is not a small company: 32B market cap- so that 2B is nothing compared to what you will find on the next two statements from companies about 2-3x as big...
JPM: Big spending on loan loss prevention.... go figure. Makes net income drop stupendously. Nice huge 55B of debt and 20B of stock on the books for just the first 3 quarters...on top of 87B last year. Again with liabilities close to assets, but that actually seems normalish for banks, judging by the history.
WFC: Again, a big jump in loan loss prevention. Like 40B of debt in the first three quarters... on top of 50B picked up last year... yuck.
Hmm, well now what. I guess I should check if JPM and WFC have TARP money, wouldn't do to invest in something that the gov makes cut dividends.
Yep, they did. So there goes that idea, their dividends aren't even safe.
Conclusion: I'm going to run to Canada and add a small RY position (10k). I am SURE that most of these companies I ran through today will recover eventually, and I WANT to get in and catch some of the upside. However, at the moment I don't trust myself enough to pick a good entry point and the right companies. I will reevaluate these companies after we see what the TARP does to dividends... and I will probably miss a large chunk of upside. The charts looked hopeful to me, but the balance sheets didn't, as far as JPM and WFC went. Oh well. Maybe I should have picked up some AFLAC- but then again, as I said, this is not a day trade fund, even if it does bounce I shouldn't kick myself. AFLAC in the past has been a very solid outperformer, so I will keep my eye on what becomes of this concern over its Hybrid Securities investments: if it turns out that AFLAC is mostly unscathed, I will buy in, hopefully before all of the upside is gone.
I think companies like with solid histories of outperformance for on the decades charts and the recent 5 yr charts should be looked at again, such as:SLF,AFL, and BNS. However, I have no confidence at the moment, especially in ALF with its recent issues. I will look at financials again, and maybe a few that aren't dividend achievers (gasp!).
Usual disclaimer: I don't know jack about the markets and I don't own any stock- so don't take this stuff as any kind of reason to invest your own money.
Next time: probably a summary of how much money the fund has lost so far (groan) and maybe, I dunno, shipping companies. Might as well call bottom on the bulk rates as well as the financial markets, eh?
Subscribe to:
Posts (Atom)