The broad commodity markets have been uneventful over the past two years. While some commodities have outperformed others, and windows of volatility may have been good for trading, the broad commodity markets ended up down in both 2011 and 2012. That being said, commodities should be attractive from a long-term perspective. The reasons are straightforward. Natural resources like oil, metals, … Continue reading Cold, Hard, Commodities
Back in August, I made my case for Helmerich & Payne (HP) at $45. When it hit $54 dollars in November I recommended taking some profits. On Friday, HP closed at $61, exceeding my fair value estimate of $59 per share. I still like Helmerich & Payne as a company, but at $61 it's time to finish taking your profits. From $45 that's … Continue reading Ring The Register
Most people probably think of Hewlett-Packard when they hear "HP." This is almost certainly the case for investors who have followed Hewlett-Packard's struggles. However, I'm not writing about that HP, I'm writing about another HP that many people have never heard of. Helmerich & Payne (HP) is a $4.9 billion oil and gas company based in the US. It provides contract drilling … Continue reading The Other HP
In fifth grade, I remember the "cool kids" at my school wore Guess jeans and a lot of hairspray (I wasn't one of them). While hair spray has lost its popularity, Guess? Inc. has grown into a $2.4 billion dollar company that sells apparel in 90 countries around the world. Last week, Guess reported earnings that missed analyst expectations and its stock price fell by more than 21%. The negative … Continue reading Second Guessing
Over the past year, there's no doubt that Europe has dominated the headlines of the world's financial news - and for good reason too. With one country after another falling victim to the "bond vigilantes," the Eurozone's very existence is being called into question. As investors small and large look for an exit, anything that smells of the region is … Continue reading Wheat in Euroland
With reference to my post about Cisco in August, I think it's time to ring the register. I still think Cisco is a solid company, and CSCO the stock may not be done with its rally. However, having just ended the trading day at $18.64, I think it's close enough to my $19 fair value estimate. From the August 10th … Continue reading CSCO Revisited
All year long, corporate earnings have been the rationale for lower stock market valuations. Typically, the arguments go something like "earnings are strong... earnings are increasing... earnings are making new highs." And while those things are true, nobody is talking about where the earnings are coming from. Fortunately, there are some seasoned-pros, like Jeremy Grantham at GMO, who read between the lines and are … Continue reading Between the Lines
Given that it does, in fact, look like the "kitchen sink" is being tossed out the window, I thought I'd provide an example of something I consider to be a reasonable opportunity. Cisco Systems (CSCO) designs, manufactures and sells products and services related to networking and information technology in general. Over the past year, CSCO stock has … Continue reading Battered but not Broken
So what did the stock market think about S&P's downgrade? We got an answer today, in bright flashing red. The Dow sank 634 points today - the sixth largest single-day drop in history. To be fair, the sell-off wasn't rooted entirely in the downgrade (which was widely expected). Rather, as I have written before, it looks like the market is … Continue reading Patient Trigger Finger
Forbes had an article today called "A Farewell to Borders." It was a "border" line tearjerker for me because I have many fond memories of that place. During my college years, I spent countless hours at Borders meeting with classmates and hitting the textbooks. They always had plenty of big tables, bright lights, and good coffee. It was such a welcoming … Continue reading It’s Still About Monetizing
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