Festival of Stocks #99
Welcome to the ninety-ninth Festival of Stocks. The Festival of Stocks is a weekly blog carnival dedicated to highlighting the best recent posts on stock market related topics.
I am proud to present this week’s best entries to the Festival of Stocks. The articles are listed by category. I have included my review of Don Keough’s new book “The Ten Commandments for Business Failure” among the links below.
Number Check on Sears by Circle of Competence
“With its market price declining daily, giving me the opportunity to pick up even more shares, I thought I’d present a very rough look at how the market is valuing Sears (SHLD) right now, putting reasonable numbers to a rather abstract investment idea.”
USG Earnings Conference and Notes by College Analysts
“From a purely operational standpoint, USG’s results were objectively poor but very good contextually. Wallboard volume shipments were down 11% quarter-over-quarter and plant utilization sits just under 70%; until capacity recovers into the mid-80%s, USG won’t have the operating leverage to put up big EPS numbers, and that day is still far off.”
United Technologies Dividend Analysis by Dividend Growth Investor
“UTX is a dividend achiever as well as a component of the S&P; 500 and Dow Jones Industrials indexes. It has been increasing its dividends for the past 14 consecutive years. From 1998 up until 2007 this dividend growth stock has delivered an annual average total return of 17.20 % to its shareholders.”
A.H. Belo: A Value Stock or a Value Trap? by Lollapalooza Investing
The new Lollapalooza Investing blog provides a detailed analysis of A.H. Belo.
“I’ve actually been an owner of Cheesecake Factory shares for a couple of years now. But the recent market malaise (aka storm, destruction and rampaging bear as quoted in the financial press) has given us an opportunity to purchase shares at prices not seen since just after the new millennium.”
“How is it possible that you are down 32% year to date, or 39% over the past year? Looking back, do you think that your positions were too concentrated in financials? Yes, Bill, I know hindsight is 20/20, and I sound a bit like Captain Obvious here, but Bear Stearns, Washington Mutual, Citigroup, Merrill Lynch, Freddie Mac, AIG, Countrywide? Where was your risk control?”
Actually, I think people are so irked at $4.00 and up gas prices — and worried about further increases — that their focus is fixed there. And Grant suggests this could be the factor consuming populist anger at the moment.
Another way I hedge is to take some profits with a stock that has risen significantly, selling 20 to 50%, and sometimes 100%, of a position to lock in some gains. I recently did this with Potash and Google.
What I am looking for here is stocks that seem to be mispriced in my favor – in other words, the dividend yield is higher than might be expected, while the prospects going forward over the intermediate term (5 years or so) for the company remain decent or better.
Dr. Janjigian’s book gingerly attempts to criticize some of Buffett’s mistaken investments and controversial points of view. I think the book is more successful with the latter than the former.
But what I haven’t spoiled for you is the fun of seeing how Keough takes these trite little dictums and develops them through anecdotes. He makes passing reference to many of the most familiar business failures; Xerox, Ford, and IBM are all taken to task…. However, Keough’s best stories are his Coke stories.