Friday, December 31, 2010

A New Year - Same Old Tax Tricks

As the year closes, many of us take time to reflect our thoughts. In fact, often this time of the years brings more thought than action, especially with the nostalgia of years past and the intention of our newest New Year's resolutions.

Within the stock market, however, some people are very active.

This might be true, anyway, but I'm referring to one specific thing.


I never have any proof, but it seems to me that the price of many stocks are mildly to strongly affected by taxes.

I see four (4) main things playing this time of year.

Thursday, December 30, 2010

Bug Yourself: Take Advantage of Help You Receive

We all have been this bug, and all of us have been in a position to kill that bug sitting on the wall or the floor.

Personally, I've never liked the idea of killing anything, including bugs. (Currently, I'm not a vegetarian, which makes me a HUGE hypocrite, but that is a topic for another area.) So I decided to save this bug.

Accepting Help

When we're in trouble, most of us wish we could just get a little break. Might I even use the word, "help?"

Many people expect help, and these people are not the target of my post, but most of us wish that we could have some help, and, of course, we'd take advantage of it if we got it. Right?

Wednesday, December 29, 2010

Gold is Not a Golden Investment

That's right. Gold is NOT the golden investment that many people assume it be.

I am not saying that gold will not go up. Then again, I am not saying that gold will not go down, either.

In fact, I am making absolutely NO predictions about the future price of gold.

Why do some people place more value in gold than money, specifically the US Dollar?

Tuesday, December 28, 2010

Management: In 30 Years who will be King, Wal-Mart or McDonald's?

Who will be tomorrow's king?

30 years from now, will Wal-Mart still rule the bargain retail industry? McDonald's the fast food industry?

I say that only one (1) of them will: McDonald's. The answer lays in the corporate layout of their management..and the way they grow.

Monday, December 27, 2010

Quick Analysis: Home Depot (HD)

HD: Home Depot

Retail for general home contactors and do-it-yourself home repairs

Recent Range: $21/share – $40/share (Current Price: 35.09, as of close of 12/23/10)
Price/Sales (P/S) = 0.85 (0.80, Industry)
Price/Book (P/B) = 3.01 (2.56)
Gross Margin = 34.2% (33.8%)
Pre-Tax Margin = 7.0% (6.7%)
Debt/Equity Ratio = 0.51 (0.42)
Current Ratio = 1.3 (1.3)
Return on Equity = 15.9% (13.4%)
Return on Assets = 7.2% (6.6%)

Analysis: This company has widely recognizable name and has a great company concept. However, I am lukewarm on the stock.

Sunday, December 26, 2010

Investing in the Stock Market: Is it like Gambling?

Is playing the stock market gambling?

This is an age-old question, but it requires more than a simply Yes/No answer, I think, because it depends.

Saturday, December 25, 2010

Merry Christmas and Good Profits to All

Merry Christmas, Everybody!

We've had a short week in the market this week, but it gives us more time to reflect upon what really is important.

Friday, December 24, 2010

When to Sell Stocks

A lot of people complain that people will tell you when to BUY stocks, but they never tell you when to SELL those same stocks.

Of course, nobody knows exactly when to sell, but here are a few guidelines that I use:

Thursday, December 23, 2010

Video: How the Stock Market Works

How the Stock Market Works

Here is a video of a cute cartoon (about 9 minutes long) that explains the basic concept and flow from a beginning business to one that is large enough to issue stock as a publicly held company.

This video uses an example of an oil drum producing company that started as a small but really good company.

Wednesday, December 22, 2010

Quick Analysis: Baidu Inc. (BIDU)

BIDU: Baidu Inc

Internet Search Engine: uses Chinese Characters

Recent Range: $15/share – $110/share (Current Price: 101.25, as of close of 12/21/10)
Price/Sales (P/S) = 34.92 (10.24, Industry)
Price/Book (P/B) = 32.55 (7.89)
Gross Margin = 70.7% (64.6%)
Pre-Tax Margin = 48.2% (34.3%)
Debt/Equity Ratio = 0.00 (0.04)
Current Ratio = 3.6 (4.3)
Return on Equity = 48.5% (23.0%)
Return on Assets = 37.9% (18.0%)

Analysis: This company is definitely in a hot industry within a hot geographic region (China). It also appears to manage its money really well. I really like the company, but I am afraid of the stock.

Tuesday, December 21, 2010

Should you get down when your stocks do?

No matter how experienced you are, nobody really enjoys buying in a stock, only to watch it down...down....and down some more.

When your stocks go down, do you panic? More importantly, should you?

Monday, December 20, 2010

Recipe: How to Make the Rich Richer: Give Everyone the Same Amount

Statement: If you want to help the rich get richer (and the poor get poorer), give them the same amount of money.

That might seem a little outlandish.

Might? Ummmmm........

Sunday, December 19, 2010

Quick Analysis: WD 40 Company (WDFC)

WDFC: WD 40 Company (Maker of WD-40 Lubricant)

Maker of household product WD-40 lubricant. Also, they make specialty chemicals to help with maintenance, cleaning, and household tasks.

Recent Range: $24/share – $41/share (Current Price: 41.08, as of close of 12/17/10)
Price/Sales (P/S) = 7.89 (5.55, Industry)
Price/Book (P/B) = 3.49 (2.85)
Gross Margin = 51.4% (29.5%)
Pre-Tax Margin = 16.7% (-17.5%)
Debt/Equity Ratio = 0.11 (0.93)
Current Ratio = 2.5% (2.2%)
Return on Equity = 19.5% (14.7%)
Return on Assets = 13.1% (8.1%)

Analysis: This company appears to be in excellent health; however, the stock does not seem like an obvious bargain, even though this seems to be somewhat of a hot stock right now.

Saturday, December 18, 2010

Video: Warren Buffett - Value Investing 101

Here is a video of Warren Buffett, perhaps the greatest stock investor who ever lived, giving the most basic advice about stock investing. (It is about 5 minutes long.)

Most of the interview discussion surrounds his purchase and subsequent selling of Petro China.

However, here are the takeaways from what he does:

Friday, December 17, 2010

Reading Suggestion: Blog: Stockerblog

This will be a quick post.

Trying to find good sources of great material, I unearthed one the other day.

I've made it one of my "Links" on the side panel, but it is SO GOOD that I needed to mention it specifically.

It is called Stockerblog, and the website is

Thursday, December 16, 2010

Not Having Income Costs Money

The title of my post, "Not Having Income Costs Money" seems like it deserves a big, fat DUUUH!

Obviously, if you don't have any income, you're not going to GET any money.

However, I'm saying that it actually COSTS you money.

Wednesday, December 15, 2010

Shorting a Stock--Going Short: What does this mean?

What does it mean to "short a stock?" (This is also called "going short" or "selling short.")

I will explain this by starting from the other direction and comparing "shorting a stock" to it.

Tuesday, December 14, 2010

Quick Analysis: Proctor & Gamble (PG)

PG: Proctor & Gamble

Product Conglomerate, mostly with consumer goods

Recent Range: $47/share – $73/share (Current Price: 65.56, as of close of 12/14/10)

Price/Sales (P/S) = 2.26 (2.06, Industry)
Price/Book (P/B) = 2.87 (5.06)
Gross Margin = 51.8% (52.0%)
Pre-Tax Margin = 19.1% (16.9%)
Debt/Equity Ratio = 0.52 (0.71)
Current Ratio = 0.7 (1.0)
Return on Equity = 17.0% (28.9%)
Return on Assets = 8.1% (9.9%)

Analysis: This company is well-run and in excellent financial health. This stock is SAFE but unexciting.

Monday, December 13, 2010

Upcoming Senate Tax Vote: What it could mean for you

The Senate is scheduled to vote on whether to extend the already existing tax cuts that former President Bush implemented during his term.

Most of you know--by now--that everyone already has this tax break extended, except for people making $250K/year or more.

The people AGAINST it want the "rich" to help buoy the economy since they, theoretically, HAVE the money to be able to afford to contribute. (This is NOT always true, by the way.)

Sunday, December 12, 2010

Revisit: Linn Energy (LINE): Looks like I made a bad call.

It looks like you can't trust ALL of my "down" calls.

A little over 6 months ago, someone asked for me to check into Linn Energy (LINE) stock.

Here is the analysis I gave at THAT time:

I mentioned, at that time, that I didn't know enough about the industry; however, based upon the numbers that I saw, I would not suggest taking that risk.

Price per Earnings (P/E): Is it useful?

Investing in the stock market can be tricky, and it really is for a lot of people. Many people think there is some witchcraft or higher power involved that will never let them have any chance of understanding it.

How many people develop ways to “beat” the stock market? Honestly, you never will beat it. You just hope that you’re on the right side of the fight and pick the winner (or loser) correctly.

A lot of people try to offer different ideas, and some seem to make a lot of sense. (Some do not; at least, not to me.)

One thing that many investors check is the Price per Earnings (P/E) figure. In fact, this is one of the most popular ratios (comparisons) used when evaluating a stock.

Is it the best?

Thursday, June 3, 2010

Quick Analysis: Bank of America (BAC)

BAC: Bank of America

Nationwide Bank

Recent Range: $6/share – $53/share (Current Price: 15.89, as of close of 6/3/10)

Price/Sales (P/S) = 1.34 (1.60, Industry)
Price/Book (P/B) = 0.73 (0.81)
Gross Margin = Not Available
Pre-Tax Margin = 2.9% (1.7%)
Debt/Equity Ratio = 3.98 (3.53)
Current Ratio = Not Available
Return on Equity = -1.3% (-0.8%)
Return on Assets = 0.2% (0.2%)

Analysis: This company is unexciting, but this industry makes me still have to guess that this is a good long-term buy.

Tuesday, June 1, 2010

Can Debt Ever be a Good Thing?

Is there ever a time when debt can be a good thing?

We all hear that we should get rid of debt. Cut up all of your credit cards. Pay cash for everything. If you can't afford it, don't buy it.

Honestly, these are good statements--usually.

Once in a while, you hear about the exception that it's okay to borrow to buy a house. This might be a true statement, but the reasons people often use to support THIS suggestion is laughable, if it weren't for the fact that so many people believed it.

Friday, May 28, 2010

My Experiment is Over!

For a while, I was experimenting with a stock trading technique.

The Idea

I picked a stock based upon its Beta value, which indicates the volatility of the stock price. The higher the Beta value, the more the stock price fluctuates.

I tried this, because I tried to extend my test with the Slow Stochastic technical indicator, telling me when to buy and sell. The more volatile the stock price, I figured that it would provide me with more opportunities to buy and sell--and MAKE A PROFIT.

Note: The Slow Stochastic indicates when a stock is theoretically overbought (time to sell) or oversold (time to buy).

Wednesday, May 26, 2010

Stock Market: When Shoud You Care?

Should you care what the stock market is doing?

It depends!

If you're a trader, probably. I'm not a trader--usually.

If you're an investor, you should be more concerned with your company and industry and the price that YOU paid to own part of it, but you should NOT be too overly concerned.

Why not?

Tuesday, May 25, 2010

European struggles are making people scared. The Dow is below 10000. Get out your checkbook, stockholders!

The Dow went below 10000. I don't know how much more it will drop...and it might drop more.

There are a lot of people panicking about the whole European debt situation. There is plenty of reason to pay attention to what is happening there, but it should only affect us--not decimate us.

Monday, May 24, 2010

Stockowners, are you getting in position?

My second rule of investing is...Buy it ON SALE! (Get a good price on it.)

Since learning how to manage money, I've learned that it's not important HOW MUCH money you make, it's HOW MUCH YOU KEEP.

This has been invaluable, as this has allowed me to accumulate more money than many of my former coworkers who earned more than me. However, it's not the whole story.

The whole saying should read...

Friday, May 21, 2010

Beginning Investing Tip: Use Play Money

When you first begin trying to learn the stock market, don't use real money--use "Play Money."

Like anything else, you need to practice before you stop being rotten. You definitely have no chance of being the best if you never practice, even if you're a natural.

Thursday, May 20, 2010

Stock Market: Am I the only one excited by this sale?

The stock market is going DOWN!

Isn't that awesome?

If you've been following my blog, you'll realize that I'm NOT being sarcastic about this.

Wednesday, May 19, 2010

Foreclosures sets new record: Are you surprised?

I don't know whether we set a record with foreclosures, but the news this morning said that we set a new record. The number of outstanding mortgages where the borrower has missed, at least, one payment is at an all time high.

Ummm...DUH! What did we expect?

Tuesday, May 18, 2010

China Economy: Is Copycating US Contagious?

This will be a quick post today.

As recently as this week, I've heard that all of us in the United States should move to China. Their economy is doing really well. It's growing. They basically own a good part of the US, anyway.

I've heard plenty, and plenty of it is true. There really are a lot of good things happening in China.

However, we might want to take a closer look.

Monday, May 17, 2010

Stock Investors: Are you panicking? Should you be?

Oh, no! The stock prices keep falling!

Oh my gosh! What do we do now?

A lot of people start panicking. These people are the same people that only saw good things coming when the market was going upward. Now that the market is sliding, many of these same people can only see doom.

These people are REACTING--NOT PLANNING.

Are they wrong? They might be right, but I suggest taking a couple of steps. (Panicking is NOT one of them!)

Wednesday, May 12, 2010

It's Splitsville for Baidu (BIDU)

Wow! I just looked at the price for Baidu (BIDU), the China version of Google.

The indicator said that it went up, but the price was below $100/share.

Eventually, I figured what happened.

Quick Analysis: ITT Educational Services (ESI)

ESI: ITT Educational Services

For Profit Education Company

Recent Range: $45/share – $125/share (Current Price: 103.16, as of close of 5/11/10)

Price/Sales (P/S) = 2.52 (3.40, Industry)
Price/Book (P/B) = 22.91 (7.83)
Gross Margin = 65.9% (56.9%)
Pre-Tax Margin = 37.8% (16.5%)
Debt/Equity Ratio = 0.96 (0.16)
Current Ratio = 1.3 (1.7)
Return on Equity = 192.3% (47.8%)
Return on Assets = 50.2% (20.0%)

Analysis: I get the feeling that this stock will rise, but I don’t feel comfortable recommending it.

Tuesday, May 11, 2010

Quick Analysis: Magna International (MGA)

MGA: Magna International

Automotive supplier

Recent Range: $25/share – $95/share (Current Price: 71.92, as of close of 5/11/10)

Price/Sales (P/S) = 0.42 (0.84, Industry)
Price/Book (P/B) = 1.06 (1.86)
Gross Margin = 11.2% (14.2%)
Pre-Tax Margin = 0.0% (1.0%)
Debt/Equity Ratio = 0.02 (0.66)
Current Ratio = 1.5 (1.6)
Return on Equity = -1.0% (1.6%)
Return on Assets = -0.6% (0.9%)

Analysis: OK.

Monday, May 10, 2010

Caution: Master Limited Partnerships (MLPs)

There are some AWESOME deals on a few oil and energy Master Limited Parterships (MLPs).

Careful! Even if the numbers look good, there is a HUGE downside to these.

You might be able to make a ton of profit on the stock price that you buy and sell. (This is not true for all of these right now, but there are a couple that look REALLY good right now.)

So what's the problem? Shouldn't I buy as much of these as I can?

No, I don't think so.

Now what? Europe is all better?

The stock market is starting to make huge leaps and bounds.

Europe is all fixed. They are going to bail out Greece after all.

Wait a minute!

Friday, May 7, 2010

What's wrong with Ford (F)?

This is craziness.

I get that the entire market is sliding. There are concerns about Greece's economy and the riots associated with the country's forced cutbacks to address that.

Ford (F) posted over $2 BILLION dollars of profit. They increased their year-to-year sales this past month over 30%. They have a fuel-efficient car that's ready for today's market. They haven't lost their Mustang. They still have their leader, who has shown great direction for the company and seems to be an expert at getting his own people to follow him in that direction.

So why has the stock dropped ridiculously during the past few days?

Thursday, May 6, 2010

Quick Analysis: Kimco Realty Corp (KIM)

KIM: Kimco Realty Corp

Real Estate Investment Trust (REIT) that invests primarily in shopping centers anchored by grocery store chains and discount stores located a short distance outside metropolitan areas

Recent Range: $9/share – $45/share (Current Price: 15.30, as of close of 5/5/10)

Price/Sales (P/S) = 7.89 (5.55, Industry)
Price/Book (P/B) = 1.28 (3.19)
Gross Margin = 69.9% (68.6%)
Pre-Tax Margin = -4.4% (3.8%)
Debt/Equity Ratio = 0.91 (2.51)
Current Ratio = Not Available
Return on Equity = -1.3% (-2.2%)
Return on Assets = 0.0% (0.8%)

Analysis: There are more things about this stock to like than dislike. The Price/Book is higher than I like, but it is a lot smaller than its competitors.

Wednesday, May 5, 2010

Quick Analysis: Career Education Corp (CECO)

CECO: Career Education Corp

For Profit Education Company

Recent Range: $13/share – $35/share (Current Price: 29.47, as of close of 5/4/10)

Price/Sales (P/S) = 1.34 (3.49, Industry)
Price/Book (P/B) = 2.74 (8.06)
Gross Margin = 65.3% (56.8%)
Pre-Tax Margin = 12.2% (15.3%)
Debt/Equity Ratio = 0.00 (0.22)
Current Ratio = 1.4 (1.9)
Return on Equity = 15.6% (47.2%)
Return on Assets = 9.8% (19.9%)

Analysis: Confused…There are a lot of mixed messages here.

Tuesday, May 4, 2010

Quick Update: Radient Pharmaceuticals (RPC)

On 4/20/10, I posted a Quick Analysis on Radient Pharmaceuticals (RPC). (Click HERE if you would like to see that analysis.)

There is one change really worth noting:

Now people are panicking?

Now what?

The market is tanking, reportedly because people are panicking over Europe's financial situation and commercial real estate concerns.

Don't get me wrong! I like seeing lower prices. (I'd like seeing them even more if I had money sitting on the sidelines to buy all of these things on sale.)

It just doesn't seem to make sense to me.

I realize that the stock market has been creating its own sort of overpriced bubble for a while. Several stocks went from being way too under-priced to costing more than they're worth seemingly overnight. (It's really been over the course of the past year-plus.)

It's just that things I am reading TODAY, just....

Monday, May 3, 2010

Quick Analysis: Linn Energy (LINE)

LINE: Linn Energy

Oil and Natural Gas Company, located in the Southern portion of the US

Recent Range: $14/share – $37/share (Current Price: 27.10, as of close of 4/30/10)

Price/Sales (P/S) = 12.34 (7.33, Industry)
Price/Book (P/B) = 1.37 (2.43)
Gross Margin = 51.1% (64.1%)
Pre-Tax Margin = -109.8% (-40.2%)
Debt/Equity Ratio = 0.65 (0.49)
Current Ratio = 2.0 (1.4)
Return on Equity = -11.4% (1.5%)
Return on Assets = -6.5% (2.4%)

Analysis: Not great…

Friday, April 30, 2010

Dendreon (DNDN): How high will it go?

Now that Provenge, the prostate cancer drug from Dendreon (DNDN) got past FDA Phase 3 approval, what's next?

The stock jumped from under $30/share to $40/share from January 2010 to April 2010.

Then yesterday, the good news hit, and the stock closed at $50/share, and pre-market indicators already push it higher, yet.

Thursday, April 29, 2010

The Baidu (BIDU) Bounce--One Time Deal or a Glimpse of Chinese Way of Doing Buisness?

Wow! A week ago, I never heard of Baidu (BIDU).

Many of you have, but for those who are not familiar with this company, it is sort of the Google (GOOG) of China. Baidu provides Internet searches using Chinese characters, which removes the need to know English--pretty big if you live in China and don't know English.

I heard there are a couple of people who live in China--say 1 billion or so. So there isn't any market, is there? Nah!

I'm learning about Baidu, still, but the Google-like connection gives it some intrigue.

You know what else makes it intriguing? Today, it jumped from $620/share or so to OVER $700. In fact, earlier this morning, it reached as high as $718/share.

What caused THAT?

Wednesday, April 28, 2010

Are we that much better today than yesterday?

Great news! The Federal Reserve met and announced that they will continue to keep down the interest rate.

This might be a great decision for the country; it might be horrible. I'm not looking to analyze this right now.

I'm scratching my head over the stock market's reaction to this announcement. It seems to forget that just yesterday, the entire market tanked, because it was concerned about the Goldman Sachs fraud deal and Greece almost certainly defaulting on its loans (with several European countries heading on the same path).

So the Feds keeping the interest rate low is more than enough to erase concerns about everything yesterday?

Why is the market moving upward? Are we really that much better today than we were yesterday? (Were we really that bad yesterday?)

Tuesday, April 27, 2010

Did Ford ever expect this? Did we?

A year ago, if someone told us that Ford (F) would announce a profit of over $2 Billion AND the stock would drop over 5% on that same day, what would YOU have said? Oh yeah, GM and Chrysler would file bankruptcy, and Toyota (TM) would have all sorts of highly publicized recall issues...AND Ford's share of the market would jump considerably....Stock DOWN over 5%.

What would you say?

Monday, April 26, 2010

Quick Analysis: Target Corp (TGT)

TGT: Target Corp

Recent Range: $30/share – $65/share (Current Price: 57.94, as of close of 4/23/10)

Price/Sales (P/S) = 0.68 (0.54, Industry)
Price/Book (P/B) = 2.72 (2.85)
Gross Margin = 30.3% (25.3%)
Pre-Tax Margin = 5.9% (5.3%)
Debt/Equity Ratio = 1.10 (0.61)
Current Ratio = 1.6 (1.1)
Return on Equity = 17.1% (19.4%)
Return on Assets = 5.6% (8.1%)
Return on Capital = 7.4% (12.3%)

Analysis: Obviously, Target is a very well known company.

However, as a stock, Target is in an ultra-competitive big box retail industry, which does not have a lot of upside for its stock holders.

Quick Analysis: Wal-Mart Stores Inc (WMT)

WMT: Wal-Mart Stores Inc

Recent Range: $45/share – $60/share (Current Price: 54.53, as of close of 4/23/10)

Price/Sales (P/S) = 0.50 (0.54, Industry)
Price/Book (P/B) = 2.90 (2.85)
Gross Margin = 24.8% (25.3%)
Pre-Tax Margin = 5.4% (5.3%)
Debt/Equity Ratio = 0.58 (0.61)
Current Ratio = 0.9 (1.1)
Return on Equity = 21.2% (19.4%)
Return on Assets = 8.9% (8.1%)
Return on Capital = 13.7% (12.3%)

Analysis: Obviously, Wal-Mart is a very well run company, but...

Friday, April 23, 2010

The Downside to Covered Calls

Covered calls are an awesome way to create income from stock that you already own.

For people who do not know what covered call options are, I'll explain them quickly here.

Thursday, April 22, 2010

Suggested General Investment Approach

I am going to tell you a "secret" that seems so simple, that you won't be probably won't be all that excited about it once you read it, because it's common sense.

I have three (3) main rules of investing:
  1. Only invest in things that you know.
  2. Only invest in them when the price is good.
  3. Trust yourself, and invest what you can in it.
This is true for EVERY type of investing, not only for stock.

Wednesday, April 21, 2010

Quick Analysis: Rexahn Pharmaceuticals Corp (RNN)

RNN: Rexahn Pharmaceuticals Corp

Recent Range: $1.25/share - $3.50/share (Current Price: 2.50, as of close of 4/20/10)
Price/Sales (P/S) = 2782.05 (1002.08, Industry)
Price/Book (P/B) = 25.22 (6.16)
Gross Margin = Not Available
Pre-Tax Margin = -8,516.6% (-4,752.1%)
Debt/Equity Ratio = 0.00 (0.36)
Current Ratio = 9.9 (6.0)
Return on Equity = -118.2% (-8.1%)
Return on Assets = -90.6% (-20.9%)

Analysis: This is not one of those “sure bets,” unless you mean a sure bet to lose.

Bank on this: Huntington Bank (HBAN)

Wow! I can't say that I expected THIS!

Huntington Bank (HBAN) announced their 2010 1Q Earnings today, and they were expected to have a small loss. Instead, they announced a PROFIT.

Tuesday, April 20, 2010

Quick Analysis: Radient Pharmaceuticals Corp (RPC)

RPC: Radient Pharmaceuticals Corp

Recent Range: $0.25/share - $2.00/share (Current Price: 1.21, as of close of 4/20/10)

Price/Sales (P/S) = 1.17 (35.14, Industry)
Price/Book (P/B) = 0.98 (4.60)
Gross Margin = 46.4% (59.8%)
Pre-Tax Margin = -47.6% (-446.4%)
Debt/Equity Ratio = 0.08 (0.30)
Current Ratio = 0.1 (3.0)
Return on Equity = -34.0% (18.4%)
Return on Assets = -32.8% (8.6%)

Analysis: Based on the numbers, this is not something that I would recommend.

Monday, April 19, 2010

Quick Analysis: National Retail Properties (NNN)

NNN: National Retail Properties

Recent Range: $14/share – $25/share (Current Price: 23.63, as of close of 4/19/10)

Price/Sales (P/S) = 8.38 (4.37, Industry)
Price/Book (P/B) = 1.31 (2.36)
Gross Margin = 94.2% (54.1%)
Pre-Tax Margin = 24.2% (8.3%)
Debt/Equity Ratio = 0.63 (1.48)
Current Ratio = Not Listed
Return on Equity = 3.3% (6.9%)
Return on Assets = 2.2% (3.1%)
Return on Capital = 2.2% (3.3%)

Analysis: OK. Seems to be a good quality company.

Friday, April 16, 2010

In case we forgot, people are sheep!

Goldman Sachs (GS) gets nailed by the SEC. The market tanks. WHAT???

Thursday, April 15, 2010

You Know You're Tough When...

ConcocoPhillips is one of the biggest oil companies. Most people fear them.

However, I think I know someone badder than them.

No, I'm not talking about Google. They might qualify, but I don't know how to measure that right now.

I'm talking about Warren Buffett.

Wednesday, April 14, 2010

Investment Tip: Invest in What You Know

All sorts of people have all sorts of advice how to make money. Some of it is good, and some of it is bad.

How do you sort out the difference?

Tuesday, April 13, 2010

Google: A Perfect Example of Why Management Matters

Everyone notice that the market is tanking pretty badly today?

Even the highly acclaimed regional banks seem to be taking a pretty good hit today, and they've been everyone's darling for the past several weeks. I'm not sure that will change for the long term, as many of them are still available for a cheap price.

However, there is one stock that is bucking today's downward trend. From the title, you probably guessed it: Google (GOOG), and this is a company where you cannot buy even one share for $500. Depending upon the commission rate, you might not be able to buy it for a cool $600, either. That's just ONE share, and it continues to be in demand.

What makes Google so attractive?

Monday, April 12, 2010

Looks like I was wrong! Dow is over 11,000.

In a previous post, I mentioned that we should look out for the neighborhood bear. I said that the stock market acts like our economy has arrived.

Even though, there are a lot of good things in place, it's still missing some things that will take time to develop. Namely, we still need to get banks comfortable enough to gives lines of credit to businesses that will create jobs. We're going in this direction, but things haven't been in place long enough to this "new money" to filter its way through the economy, yet.

So I said to look out for the neighborhood bear.

Since that day, the stock market has gone mostly....UP. That's right! Up.

We just broke 11,000 today, and it seems like there isn't any bear in sight. Everyone and their brother (including me) figures that we are long overdue for a market dip. It hasn't happened, and it's not clear that it will.

I'm confused--officially.

Be careful of bubbles forming.

Friday, April 9, 2010

Trade Winds: Regional Banks

Today notwithstanding, it sure seems like regional banks are the flavor of the month.

The last 2-3 months have been really kind to these stocks, like Huntington Bancshares (HBAN) and Fifth Third Bank (FITB). Other bank stocks seem to be following the same pattern, too, but I don't follow those so closely.

I'm glad they are, even though I sold my shares a while ago. This might reflect that people are gaining some confidence in this part of our economy again. We'll check again a few months from now.

If anyone reading this has any insight, feel invited to comment.

Observation: Enova (ENA) Might Be a Good One-Part 2

I've continued to follow Enova (ENA), and this seems to be an endless supply of opportunity to make money chunks.

My instincts would have been to buy a bunch at $1.47/share or so that I bought earlier (and later sold) and hold onto it for a while. Ultimately, this might be okay, but I would have missed on a TON of quick profit chunking opportunities.

I'm wondering whether certain stocks attract certain people who follow certain technical indicators. It sure seems like some stocks price patterns perfectly follow the MACD. Others follow the Slow Stochastic. Even if I'm right about this, I don't know how to identify it in advance. Therefore, I haven't figured a way to really profit from it.

Perhaps, it's a good idea to see a pattern established. Then ride the train. I don't have enough experience to know how risky this approach is, though.

Test Number Two: Cheating the Technical Indicator #2

I'm still cheating my technical indicator test with Biopack Environmental (BPAC).

I'm still doing the Buy & Hold thing on this one, and it's pretty boring right now.

Buy Price: $0.29/share

Current Price: $0.19/share

The financial numbers were released recently, and they looked pretty good. I wonder whether I'm missing something here.

I admit that there seems to be a limited amount of profit on environmentally friendly food packaging material, but we DO eat a lot of food on this planet. I imagine that someone would have to sell a whole lot to make a modest amount of profit, though.

I'll keep you posted.

Thursday, April 1, 2010

Test Number Two: Cheating the Technical Indicator (Part 2)

I'm still holding onto Biopack Environmental (BPAC), and I'm still cheating.

I'm not using the Slow Stochastic technical indicator. I'm using that ol' buy and hold method now.

I have to admit, it's certainly not as fun to just sit there and hold onto something. Trading is really pretty fun.

However, with this one, I'm learning that it's probably the right thing to do.

Wednesday, March 31, 2010

Observation: Enova (ENA) Might Be a Good One

I am making a prediction.

Enova (ENA) might be a good money-making stock.

I don't know whether it is a good company. I suspect that they are speculative and have their hopes pinned on something that only might take hold.

So why do I think that it might be a good one?

Tuesday, March 30, 2010

Look Out! Slippery Slope Ahead

It was just about time.

The market seems like it is beginning to slip. The news is beginning to get really gloomy.

Actually, people are NOW just starting to realize that Wall Street was trying to create another bubble. Bubbles are really great--until they POP! That happens when people start realizing that things just cost too much without any real reason.

Quick Analysis: Devon Energy Corp (DVN)

DVN: Devon Energy Corp

Recent Range: $50/share – $75/share (Current Price: 64.57, as of close of 3/29/10)

Price/Sales (P/S) = 3.52 (6.84, Industry)
Price/Book (P/B) = 1.81 (2.32)
Gross Margin = 79.2% (63.2%)
Pre-Tax Margin = -56.5% (-39.0%)
Debt/Equity Ratio = 0.47 (0.49)
Current Ratio = 0.8 (1.5)
Return on Equity = -16.9% (2.0%)
Return on Assets = -8.9% (1.8%)
Return on Capital = -10.1% (2.5%)

Analysis: DON’T BUY.

Quick Analysis: EnCana Corp (ECA)

ECA: EnCana Corp

Recent Range: $24/share – $35/share (Current Price: 30.34, as of close of 3/29/10)

Price/Sales (P/S) = 2.00 (1.14, Industry)
Price/Book (P/B) = 1.22 (1.77)
Gross Margin = 17.5% (11.7%)
Pre-Tax Margin = -56.5% (-39.0%)
Debt/Equity Ratio = 0.47 (0.25)
Current Ratio = 1.4 (1.1)
Return on Equity = 9.3% (13.1%)
Return on Assets = 4.5% (6.4%)
Return on Capital = 5.0% (8.7%)

Analysis: OK—NOT GREAT.

Quick Analysis: Southwestern Energy Co (SWN)

SWN: Southwestern Energy Co

Recent Range: $31/share – $52/share (Current Price: 40.73, as of close of 3/29/10)

Price/Sales (P/S) = 6.08 (6.84, Industry)
Price/Book (P/B) = 5.59 (2.32)
Gross Margin = 69.4% (63.2%)
Pre-Tax Margin = -2.4% (-39.0%)
Debt/Equity Ratio = 0.44 (0.49)
Current Ratio = 1.1 (1.5)
Return on Equity = -1.5% (2.0%)
Return on Assets = -0.8% (1.8%)
Return on Capital = -0.9% (2.5%)

Analysis: Unimpressed.

Quick Analysis: Petrohawk Energy Corp (HK)

Recent Range: $19/share – $28/share (Current Price: 19.97, as of close of 3/29/10)

Price/Sales (P/S) = 5.43 (6.84, Industry)

Price/Book (P/B) = 1.77 (2.32)
Gross Margin = 57.9% (63.2%)
Pre-Tax Margin = -164.3% (-39.0%)
Debt/Equity Ratio = 0.79 (0.49)
Current Ratio = 0.6 (1.5)
Return on Equity = -30.5% (2.0%)
Return on Assets = -15.1% (1.8%)
Return on Capital = -16.9% (2.5%)


Friday, March 26, 2010

Test Number Two: Techinal Indicator (Part 5)

I stopped playing by the rules for this test.

I was trying to use the Slow Stochastic technical indicator to determine my "buy" and "sell" signals for Biopack Environmental (BPAC). Today, I got the "sell" signal.

Here are the stats:

Toyota: Is this stock stupid, or am I?

I don't get it.

Toyota (TM) keeps getting bad news. Their accelerator petal sticks (not always but often enough to make the news circuit). They replace the defective parts...with parts that are still defective. They seem to "hide" information.

Yet their stock keeps rising.

Thursday, March 25, 2010

Test Number Two: Techinal Indicator (Part 4)

The Market just opened an hour ago, and I'm already down around 20% today. That doesn't include yesterday big loss....or the day before that.

The technical indicators keep telling me to buy, buy, buy. The MACD told me not to buy, but most of the others seem to point toward the "buy" signal.

Biopack Environmental (BPAC)
Original Buy Price: $0.29/share
Today's Price (Early AM): $0.20/share.

Let's hope this thing changes for the better, but I'm not so hopeful. I've been wanting to cut my losses for a while, but I'm trying to remain patient throughout this experiment. So far, I'm really being tested.

Wednesday, March 24, 2010

Test Number Two: Techinal Indicator (Part 3)

My test using technical indicators continues with Biopack Environmental (BPAC).

I bought this at $0.29/share.

Today, it sits at $0.25/share.

My common sense told me to sell at $0.27 or $0.26/share, but the technical indicators keep saying "buy" instead of "sell."

My next test will not be a OTC stock. It's not always easy to get up to the minute quotes. So I'm never very secure that I am getting the read on the technical indicators at the time I need them.

We'll see what happens. If this doesn't work, it will just be a test gone wrong--not my major investment portfolio. There is time, still, since it has gone as low as $0.08/share during the past year.

I'll continue to post the play-by-play on this one as it unfolds.

Monday, March 22, 2010

Health Care Bill Saves the Day!

So the mighty Health Care Bill finally passed the House.

Wall Street is celebrating. Times will be great now!

Doesn't the Senate have to vote on this? Oh, I know. That's a sure thing!

Wait a minute! Why is this a sure thing? Didn't the Senate stall the bill last time it passed the House? Weren't they celebrating last time the House passed the bill?

Friday, March 19, 2010

Market Upswings: What's the downside?

Bull rushes are great when you have a bunch of money already IN the market. It really is a rush to see your assets grow without you really doing very much, especially when it happens the way you planned. In fact, sometimes, these are so good, they happen more quickly than you ever envisioned, and they happen a lot more quickly than you saw coming.

However, I think there is a tremendous downside to the market running upward.

Wednesday, March 17, 2010

Continuing My 2nd Test

Today, I continued my second test with BPAC.
Yesterday, I bought it at $0.29/share. Today it dropped to $0.28/share. Now it's rebounded to $0.30/share.

Since I'm testing things using the Technical Screener (Slow Stochastics), I'm not selling it, yet. However, it IS killing me.

I don't know how soon I will enter another OTC stock. It doesn't seem to have enough trading volume to afford the buying/selling flexibility that I want. You cannot put in a limit; so you have to keep checking the prices 6,000 times per day. I like gathering data, but NOT THAT MUCH!!!

Plus, I don't know that I can sell it at $0.30/share. The Ask (Buy) price is $0.31/share, but the Bid (Sell) price is listed at only $0.28/share.

I'll keep you posted.

Tuesday, March 16, 2010

Test Number Two: Techinal Indicator, with a Twist

I had an idea I wanted to test.

I looked at a list of stocks that were really volatile (Beta Value > 10.0). There were a few.

I picked one from the list where the Slow Stochastic Technical Indicator told me to BUY.

So I bought some at $0.29/share.

Monitoring Post-Selling Movement from my First Test

Yesterday, I bought and sold Enova (ENA) for my first test using a technical indicator. For this, I used the RSI and Slow Stochastic. (Keep in mind...I'm not using very much money for my testing.)

I bought AND sold it yesterday for a nice little profit. I won't be able to retire from it. In fact, it really wouldn't even pay a day's worth of wages, but it was a nice result from a first test.

However, yesterday, I also mentioned that I would not usually sell things at that level.

I admit that the stock dropped a little. However, it's returned to the price level that made me sell yesterday. The Technical charts do NOT tell me to buy this.

I will keep you posted, but for now, my common sense--not the charts--are tingling like crazy.

This morning's price is $1.65 as of when I started writing this post

Monday, March 15, 2010

Continuing My First Test: Just Sold It

I didn't expect results THIS quickly, but Enova (EVA) jumped up around $0.20/share today.

I checked the RSI and the Slow Stochastics, and they BOTH SAID SELL. So I did.

I bought these shares at $1.48/share and sold them at $1.65/share. That's a little over a 10% profit in less than two (2) business days.

I'm curious how much further it will climb. I usually wouldn't have sold it so quickly.

My guess: It will drop a little but not enough to trigger another "buy" signal. However, I think it will keep rising after that quick drop.

I'll keep you posted.

Trying Something New: Trading Using Technical Indicators

I like to fancy myself as purely a fundamental trader. However, if I'm honest with myself, I probably use fundamental ratios to get me started, and I tend to time the market for the actual buy and sell points. Luckily, I seem to have a knack for "timing" the market since identifying patterns comes so easily for me. Numbers make it that much easier for me.

Don't get me wrong. Using "play" money, I've made mistakes. (Luckily for me, I haven't made too many mistakes with real money so far.)

Last week, I had just a little bit of money in my broker's account. So I decided to buy a speculative stock, which I've been watching for nearly a year now. I decided to use the RSI and Slow Stochastic indicators. Both of them told me it was probably time to buy Enova (ENA) @ $1.48/share. My pattern watching told me that this might not be THE lowest price, but at the time I bought it I figured that its price was closer to its near-term bottom than its top.

I'll keep you posted on how I do with this. Even if I win, I didn't invest/gamble enough for it to change my life. The good news is that if I lose, my life will be unaffected, still.

I want to keep track of this so I can get some practice using technical indicators.

Sunday, March 14, 2010

Buying the Stock Based on the Product--not its Price: Toyota

I know someone who bought Toyota (TM) a couple of weeks ago.

I remember telling this person that I was looking to possibly buy TM--IF they dropped to the low 60's, if not fully drop into the 50's. During the past 1-1/2 years or so, they've been struggling with higher recall levels than usual. However, their PR has been taking HUGE hits since this whole accelerator sticking (made by supplier CTX), causing a lot of accidents.

Wednesday, March 10, 2010

Has Our Economy Changed THAT MUCH?

I've neglected my blog for a while.

Plenty has happened in my personal life, but that's not the point of this blog.

About a month ago, the Dow dipped below 9000. Today, it is over 10,500.

What is the difference between the economy today versus a month ago? Really?

Friday, February 5, 2010

Dow Under 9000: Bad Day...Great News!

The Dow just dipped under 9000 today. For those stock traders (or at least casual followers), you can expect to see doom and gloom in the news. You are going to hear all sorts of predictions about the economy heading into the tank. There are a lot of people panicking in general, and they're selling big time.

Thursday, February 4, 2010

Networking: Spend Time with People Who Are Driven and Excited

If you want to become a really good musician, does it make sense to spend time with Warren Buffet or Beyonce Knowles? Whether you are a fan of Beyonce, I think I know that you are not going to Mr. Buffet for musical inspiration.

If you don’t think the people with whom you associate affect how much money you make, I’m going to suggest that you think again.

Wednesday, February 3, 2010


Hello, all fellow investors and those who might want to become one.

Most of you looking at my post already know about me, but for those of you who do not know me, let me tell you a little about myself.

I want to learn how to make money.

I don't want extravagant things, except an occasional trip. Even then, my tastes are pretty simple while my appreciation for the little things remain high. I really like removing stress from my life. I don't need big things; I just want a big cushion so that I never HAVE TO do anything just BECAUSE I need the money.

My goal is to learn how to make money in enough different ways to be able to teach the greatest number of people how to make money. I am happiest when I am helping people. Plus, I think that it could help reduce racial, ethnic, and sexual discrimination and other needless negative tensions between different groups of people. You might hate people who have my demographic, but how can you hate someone who helps you solve problems? Maybe you'll still hate me, but you won't hate what I've done for you.

Hopefully, throughout this blog, I will provide some ideas that you didn't know. If not, maybe I will reinforce what you already know.

Ask questions as often as you'd like. I cannot stress how much I welcome them.