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Somethings not right. What's the catch?
Guys here is an interesting new dividend stock. It's a pink and I was actively showing the red flags to the board but they just announced a CASH Quarterly dividend of 25% at the current price of .015!
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=33637787
It now has hit the OTCBB list so it is real. I still view it as highly speculative and high risk but might be worth a throw of the dice up to .04 cents!
-Sands
today's headlines
Stock futures briefly cut losses on UK rate cut
ECB cuts rates by 50 basis points, more action expected
Britain slashes interest rates, ECB to follow
Wal-Mart October same-store sales rise
Yahoo up after CEO says Microsoft best option
Toyota hacks forecasts as U.S. carmakers seek help
Oil extends loss below $64 after UK rate cut
Obama considers Geithner, Summers for Treasury
Volkswagen executive cashes in on short squeeze
InBev sticks to Bud deal, third quarter just above forecasts
good move rrufff I also picked up PVX at 5.25 they just announced the dividend at the same pay out!
good luck
Sands
"Personally, I think that non-reporting pinkies should not be allowed to trade, but until the SEC does this, pinkies are good for extreme gambles."
Come to my board and I'll teach you how to gamble by diversification.
I've ran a monte carlo simulation on college football betting.
I do it weekly.
.Scovanner Investments.
PVX low 4.55 SO FAR. Still short USO to hedge.
High risk.
If you check my posts, you'll see I raised some serious issues re PVX and its kin before the 50% or more haircut. Given the premise in setting up this board that it was kind of a sure thing and given the premise that it can be compared to crap pinkies, etc., the market has proven that my own diversified approach is really the only way to go, at least in my own opinion.
Clearly, comparing pinkies and pennies to dividend plays is apples and oranges. Sometimes an apple is good for you, and sometimes an orange is good. Sometimes tainted produce can kill or seriously sicken you. Personally, I think that non-reporting pinkies should not be allowed to trade, but until the SEC does this, pinkies are good for extreme gambles. Reporting OTC BB stocks can be even better in my opinion for those willing to take risk and which have a bit more transparency that prevents exponential dilution and manipulation of the pinkies. One should never do any of these plays with money that is needed to survive. Even stocks mentioned here probably should not be played by those who absolutely need the money over the next couple of years, e.g., for bills, mortgage, college, etc.
In any event, despite the risks, I'm now buying PVX and EPD, 2 oil related dividend plays.
At this point, with PVX touching the 5 area, the risk to me is worth the play. But, again, continue to realize that there is no sure thing. This area has risk, that's why you have yields as high as 20%. Many of the crap pinks I follow have performed better, but again, apples and oranges.
Shorts, are you still holding anything here?
I'm ready to get back in soon.
This piqued my interest: RGNC: NASDAQ
Anybody have a quick opinion?
have a great labour day guys!
==================================================
Good morning and welcome to Before The Bell
While Democratic nominee Barack Obama’s soaring oratory last night was filled with exhortations of change (can he break a $20?), the stock market is seeing more of the same.
Fears of Hurricane Gustav’s effect on oil and gas installations in the Gulf of Mexico, rising crude oil prices and weaker corporate earnings -- this time from Dell Inc – all put pressure on stock futures this morning.
The world’s second largest computer maker said the companies are cutting back on technology spending, which sent shock waves through the tech sector including IBM and Apple.
The treasury market is set to close early today ahead of the long holiday weekend.
Drive safely this weekend and flip your burgers frequently.
Derek Caney
Newsmail Editor
I have no problem with good dividends and, in fact, that is why I looked at these stocks and mentioned that I am interested in possibly adding these to a diversified portfolio.
However, I merely pointed out risks and was looking for an even discussion of these points. I have yet to see any discussion about the negatives.
I see lots of "no-brainer" and "it's the best," and I just read a post where the poster apparently is recommending purchase on margin.
Again, reference is made to this article
http://www.dividenddetective.com/canadian_royalty_trusts.htm
and still looking for answers to these issues I have raised
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29208165
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29187736
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29171971
Hi Screamer I totally agree with you and right now these Canroys are at bargain prices. I add as I can..
All stocks are risky but this sector is the safest one there is. Just call your broker and ask them what the Margin requirements are here...
They will let you margin these Canroys and only have to maintain a 35% EQUITY.. There is no safer stock sector to invest in. IMHO
regards
Shorts
You are very funny. First you say look at your first post and want to compare this arbitary start to show that you somehow always make a profit, calling this area of the market a "no-brainer."
Then you imply you always make profit by dollar cost averaging over time, calling that a "no-brainer."
Do you see the inconsistency in your argument? Are you arguing an arbitrary trade from the start of your posting or are you arguing that one should dollar cost average?
Why do you ignore the simple fact that PVX and most others are 20%-35% off the highs? Why do you ignore the risks that I have queried you about?
Do you deny the risks? Are the articles and citations that I posted incorrect?
Why the personal attacks?
Why can't you refute the substance of the citations I posted?
ROFLMAO
You say I post "FUD."
Do you know that FUD = Fear, Uncertainty and Doubt?
What have I posted that is FUD?
I posted my opinion that there are risks, significant risks in this end of the market. I did not say that these risks should be avoided, just acknowledged.
You don't seem to like that.
wrong again rufff LOL look at the original posting on PVX in the Ibox...
It was trading between 9-9.50 so anyone that bought it as a buy and hold would be up more than 15% even with the pull back from the highs...
Always a pleasure to correct your FUD.
I would recomend you don't buy this risky stocks and stick with your safe and sure micro craps.. opps I mean caps!
-Sands
> These messages are only the opinion of the poster, are no substitute for your own research,http://investorshub.advfn.com/boards/board.asp?board_id=7707
LOL - I'm not wrong shorts - the chart indicates a 20-35% loss during the time you have posted bullishly.
Your observations also indicate that you seem to like to manipulate data for your own points.
You took an arbitrary trade. It's very similar to posting you often criticise on microcap boards.
I previously commented that it was quite silly to make broad statements. You seem to be stating though that this is a "sure thing." Yet you claim that one cannot make money in microcaps.
You indicate that, "Canroys are a no brainer." It sounds like you have fallen in love with one area of the market, and this area of the market is well off its high.
I prefer a diversified approach. I've done well in microcaps, acknowledging the risk. I've also done well with XOM and other big caps, supplementing with option writing. I don't doubt that the stocks you tout here can be useful as part of a diversified portfolio. However, it's foolish to suggest that this is a "no-brainer" or that one cannot lose money here.
Despite your suggestion to the contrary, IMO it is wrong to suggest that it is a sure thing. I've pointed out many risks here and have yet to have you refute this or even acknowledge the risks.
The risks include but are not limited to
Tax ramifications
Possible individual liability
Risk connected to oil price fluctuation
Risk that dividend will be reduced.
Please see my prior posts.
NO your wrong again ruff.. Screamer did buy and hold for 10 months and had a 9000 dollar profit...
diversify dollar cost average and these Canroys are a no brainer..
Unlike micro caps that will cause 90% of investors that buy and hold to lose about 99% ever single time!
good luck
Sands
I posted nothing materially false. I posted that you have been posting positively with respect to these stocks. Anyone who followed a "buy and hold" would have a loss of somewhere between 20% and 35%.
You often go to other boards and mention the negative of others' picks.
I came here and referenced many extreme risks here, but also was fair in indicating that the dividend was very attractive.
There is risk in all areas of the market and there is high risk here.
I posted my opinions and my quest for information. Apparently, that irritates you.
Have a nice day and hope you feel better soon.
No rruff your post didn't bother me a bit! I simply didn't like your materially False accusation of experiencing a loss and that I was touting this from its highs...
Here is an example of one of the board participants that bought AAV over 12 dollars had it fall to 8.50 then he dollar cost averaged and it returned to 13 dollars and he made 9,000 dollars between capital gains and dividend distributions....
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=30181589
So for you to say that people have lost money here is just plain nonsense and materially FUD as you would say!
good luck
Sands
Sands - I'm sorry my posts seem to have gotten under your skin. I'm also sorry you posted I don't "like" you. I do, in fact, like much of what you post and agree with a lot of it.
I merely came over here to get info on a prospective stock and my posts seem to be seen here as bashing, when I merely wanted to get some discussion of pro/con arguments and issues. It's not good to get overly emotional about any stock. All stocks have risks. There is no free lunch.
Good luck and hope you feel better tomorrow.
rruff... that is a totally false statement... I started this board a year and a half ago... these stocks has moved up and down 20-30% in both directions several times and the whole time has paid a very stable dividend! If you couldn't swing trade this and make profit while receiving a dividend that is your problem!
good luck with your retehric. Its very obvious that you don't like me and are making a very lame attempt to discredit me! The feeling is mutual my good trading Bro!
RE:You've been touting this since the highs and, if you did a buy and hold, you'd have somewhere between a 20% and a 30%+ loss.
-regards Sands
For someone who is afraid to back-up your posts, you certainly assume a lot. I've been very successful in microcaps, largely, and as I post, because of diversification.
You've been touting this since the highs and, if you did a buy and hold, you'd have somewhere between a 20% and a 30%+ loss.
I have a very diversified portfolio that has done very well in all areas. I'm not asking anyone to follow my lead and I merely post opinions and thoughts, as you do.
You seem to go around from board to board, hit and run and bash others' picks. When the same happens to you, you piss, moan and whine, but not necessarily in that order.
I merely came here looking for info on PVX and the like and then posted some bullish and bearish points. There is risk in every area of the market which is why I recommend diversification. I'm still looking for refutations of the points I posted about the stocks, but instead find assumptions and personal attacks LOL.
Have a nice day and enjoy trading.
ruff I am not a finacial adviser so I don't post my buys and sells but if you want to trade PVX it is a great swing trading stock!
I think you should really stick with your micro cap stocks...
then you can lose 98%... PVX is doing just fine and if you picked it up recently in the high Nines you could sell and keep your free shares..
When I trade the stock and it goes up .20 or more cents I sell and keep the free shares from the profit. Then I re buy when it dips .20 or more cents. It does this 5-10 times a month if you follow the stock on a daily trading screen been doing this for months..
good luck
Sands
> These messages are only the opinion of the poster, are no substitute for your own research,http://investorshub.advfn.com/boards/board.asp?board_id=7707
shorts - Not trying to analyze your trading. These boards are about the stocks not the posters. However, your post talked about stop losses. Nothing wrong with that but that's not the same as a "sell" recommendation.
I'm showing a high of 13.55 on November 7. Is that wrong? If so, I'm using percentage showing drop from the number you cited. (Note - it looks like you were recommending these stocks at about that time, but if I'm mistaken, please disregard
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=24341982)
(Note - it's kind of silly to compare areas of market but I did note your recommendation of a low ball order on GM at 35. Your IBox tends to make one think that one area of the market should be compared to another. I respectfully suggest that risk should be managed no matter which area of the market one plays.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=24343647)
You say you've been actively trading and adding free shares. I haven't seen any contemporaneous posts. What do you mean by "free shares?"
As for your poing of adding or starting positions, I have no problem with that. I took profits on many of my oil positions from FPP to XOM and am now accumulating. On XOM, I have been able to get a large dividend and magnify that by writing both puts and calls.
I've also been shorting the USO to play the down turn in oil prices. I was able to get shares and capture the premiums by writing calls on USO. I recently covered part of my position by writing puts on USO. This way enables one to get the premiums, which are large, and helps when I make bad trades. It's a great cushion and often makes good trades out of bad ones.
I still haven't opened a position here but continue to look for interesting information pro and con.
Obviously the dividend payout is exciting but those out there should realize that there is no free lunch and high payouts have inherent risks.
See my prior posts
=====================================================
PVX was as low as 9.80 - close to a 20% drop from the highs. It goes to show that one can lose money even in supposedly "safe" stocks and that one should not blindly follow any "sure thing."
Again, reference is made to this article
http://www.dividenddetective.com/canadian_royalty_trusts.htm
and still looking for answers to these issues I have raised
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29208165
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29187736
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29171971
rruff PVX closed 10.49.. Geesh I have been actively trading this stock and adding Free shares 5 times a month... What are you talking about here?
Now is a great time to be adding or starting positions with the canroys.. the Divy is now 14% and the earnings on PVX were great.
BTW the high was 12.50 not 13.50 and I was recommending selling at that price if you have been following the board!
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=29497150
RE:It's down from 13.50 high.
PVX over the long term is in a uptrend. Just pulled back because of the Oil bubble burst!
good luck with those micro cap stocks!
regards
Shorts
> These messages are only the opinion of the poster, are no substitute for your own research,http://investorshub.advfn.com/boards/board.asp?board_id=7707
PVX 10.07 pre-market - but should recover a little. It's down from 13.50 high.
See prior posts - there is no free lunch and all should read about the risks and rewards.
Haven't been following, but read some stuff today - SCARY....
No talk of going "belly up" yet.
Financials Aug 5.
I say "ded".
Any comments on AFN?
Marilyn
OT:
From CNN today"
NEW YORK (CNNMoney.com) -- The housing finance crisis and spiraling energy costs will remain a drag on the U.S. economy for the rest of the year, Federal Reserve Chairman Ben Bernanke told lawmakers in a gloomy presentation about the economic outlook.
And President Bush says the economy is strong.
One of them is lying - and one has a track record of lying.....
LMAO!
I got this one on my watch list. I know it's OT from the ibox, but you gotta diversify your plays.
Welcome to the Reuters Before the Bell news mail.
Megamergers and soothing congressional testimony from the likes of Fed chief Ben Bernanke don't come along every day, as Wall Street is painfully aware. Stock futures are pointing down as the glow from yesterday's news fades and the focus returns to the latest installment of the credit crisis.
The New York Times says that if problems at Fannie Mae and Freddie Mac get worse, the U.S. government might take over the mortgage financiers in a plan that would leave shareholders with nothing.
And earlier today, oil hit another record high - $145.98 a barrel - on worries over supply disruptions from Iran and Nigeria, as well as the threat of a strike in Brazil next week.
General Electric's reassuring quarterly results, which might have moved the market higher on another day, failed to penetrate the overall gloom, although they did boost the company's stock.
The dollar is steady against an index of major currencies. U.S. Treasuries are mixed.
Two more chemical companies are looking to tie the knot. Ashland is buying Hercules in a cash-and-stock deal valued at $2.6 billion.
Several pieces of data are on the way, including the international trade deficit and import-export prices.
There will also be a report on consumer sentiment. It may not be all that bad, given that people are lining up for the new version of Apple's iPhone, which is going on sale today.
Until Monday,
Lisa Von Ahn
News Mail Editor
That was my BIG mistake. After being a Big Board investor since 1972 (won and lost a fortune twice - long story - medical bills, divorce, custody battle, college), I decided to go into pennies thinking it reacted like the Big Boards.
I had no idea how volatile and crazy (among other things) this OTC stuff was.
It's really a totally different animal.
Maybe after my last 2 kids finish medical school, I will try again with a different approach.
Until then, I'll stick with what I know and watch from the sidelines to gain some insight.
Good Luck!
testing the waters in the otc will get you the experience to become a winner more than loser...but still you can be up 200% then go to the washroom for a piss come back and you're down 100% ...atleast the rises and falls in the big stock exchanges are more gradual...but charting and timing will help ya in whatever you invest
Yeah, I see.
Another key to OTC is having the guts, which I do not have.
Disagree there - any risk can be quantified and minimized if you do DD and diversify. If you have a basket of OTC BB stocks and carefully time buys, not all at once, keeping track of the filings and chart, you can have very large overall gains. Sure, you will have losers, but the multi-bagger gains is why many play here. It goes without saying that one has to recognize the risk, not go along with the "crowd" and, again, diversify, and step gradually into any play to have a chance at the payoff.
Agreed.
But the OTC crap is a different story - no rules apply, except a dart board with dull darts (I stay away, now).
Very true - diversification is the key I believe no matter how much risk you are willing to take on.
And one must NEVER assume a stock is "safe" or a "sure thing".
There is only one "sure thing" in life..............
PVX 10.56 was as low as 9.80 - close to a 20% drop from the highs. It goes to show that one can lose money even in supposedly "safe" stocks and that one should not blindly follow any "sure thing."
Again, reference is made to this article
http://www.dividenddetective.com/canadian_royalty_trusts.htm
and still looking for answers to these issues I have raised
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29208165
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29187736
http://investorshub.advfn.com/boards/read_msg.asp?message_id=29171971
I'M NOT CANADIAN, BUT LIVE CLOSE ENOUGH TO SWIM THERE.
I can see Canada from my house.........
DETROIT-WINDSOR
mkendra@sciencedetroit.org
sweet, good job...
Canadian oil trusts are sweet, Its' good to be canadian, eh?
I also learned the hard way - re:OTC.
Did not buy any for about a year and am up 85% this year.
Compared to the DJIA, I'm smokin'!
Never, ever again.
(It's a 12-step program, BTW) LOL!
Finally, found a board on Ihub where making money is an option!
my friend told me to look for stocks that pay dividends, but I ignored him and decided to take high risks for high rewards ie. stinky pinkys, so far that hasn't trumped out;
I think looking for stocks on nyse, amex, nasdaq that pay dividends and combine that with some dd, charting and TA will get the gains that people look for in pinks/otcbb...it will take a longer time, but it has more guarantee than the damn pink scam vans.
I will try to contribute to this board, but for now I will be looking around, commenting and asking questions.
Oh my what a blood bath the market is taking....Its starting to get scary here. GM hits the lowest its been since 1954!
That was the year I was born in... LOLOL Pretty hard to find the green in this red sea of pain!
-Sands
Good morning and welcome to Before The Bell
Non-farm payrolls declined 62,000, more or less in line with the forecast of a decline of 60,000. Jobless claims came in at 404,000, a little higher than the 385,000 expected.
The stock market had little initial reaction, a day after the market fell into bearish territory with the Dow Jones industrial average and Nasdaq down 20 percent from their peaks in October. U.S. treasuries were strong, while oil futures rose another $2 a barrel to $145.84 a barrel.
The dollar was slightly stronger against the euro overnight after a quarter-point interest rate hike by the European Central Bank disappointed investors expecting a bigger move. ECB President Jean-Claude Trichet is holding a press conference this morning to discuss the interest rate hike.
And in other news, Zambia’s vice president said this morning President Levy Mwanawasa is not dead. He’s feeling much better. Generalismo Francisco Franco, however, is still dead.
And lastly, happy birthday, America. And may we say, you look just great for 232 years old. Some crow’s feet around the eyes, perhaps, but you don’t look a day over 196.
Remember to turn the meat on the grill. And we’ll see you all on Monday.
All the best,
Derek Caney
Newsmail Editor
RGM (GENERAL MTRS CORP NT SR 7.25%52 RGM: NYSE )
paying 15% - divy xdate end of July.
ON SALE!!!
I'll be selling my AAV tomorrow to get involved in a long-term play.
I've been in AAV for 10 months, with buys in Aug and Jan.
my results:
profit after tomorrows sale: about 7100.00
dividends: almost 2000.00
About 9100.00 total gain.
Conclusion: safe, fun, and profitable investment
Shorts,thanks for calling this to my attention.
HERE'S A DECENT ARTICLE FOR SOME IDEAS AND PREDICTIONS:
How our 10 investing themes for '08 are doing, and what's changed
By Jonathan Burton
Jun 20, 2008 20:03:00 (ET)
SAN FRANCISCO (MarketWatch) -- Oil prices were below $100 a barrel and the Dow Jones Industrial Average was above 13,000 last November when MarketWatch wrote about 10 investments to consider for this year.
What a difference seven months, a credit meltdown, crumbling housing prices, $4-a-gallon gasoline, inflated commodities, recession fears, and a stock-market correction can make.
"I'm not feeling any better," says Sam Stovall, chief investment strategist at Standard & Poor's Inc. "I would have liked us to be a little farther along than we are. Now our forecast is for a delayed recession, rather than a canceled recession."
With that in mind, it's a good time to check on the 10 themes and see what changes, if any, investors should consider.
The bond landscape has changed dramatically since November, when the Federal Reserve was lowering short-term interest rates and Treasury prices were rallying in response. "Don't fight the Fed," MarketWatch advised, noting that some strategists saw the benchmark Fed funds rate tumbling to 2% from 4.5% before the Fed was done.
"Don't fight the Fed" is as apt today as it was then. Only now, the Fed funds rate is indeed at 2% after a series of aggressive cuts that began in January, and though there are whispers of rate hikes, central bankers likely won't rock the boat too much, if at all.
Treasurys were a good buy in the first few months of the year, but no longer, says Bernard Baumohl, managing director at forecasting firm The Economic Outlook Group. "We see inflation pressures increasing, and as a result that does place downward pressure on bond prices," he says. Plus, he expects Treasury yields will climb to lure reluctant foreign buyers to U.S. debt.
: Think outside the Treasury bond. Municipal securities are attractively priced, says Marilyn Cohen, president of bond-portfolio manager Envision Capital Management. Yields on 10-year munis are on par with comparable Treasurys. Says Cohen: "The closer your yield on munis gets to the Treasury, you've got a pretty good investment."
Non-agency-related mortgages -- bonds not backed by Fannie Mae, Sallie Mae or Freddie Mac -- make up 45% of the TCW Total Return Bond Fund (TGLMX, Trade), says Jeffrey Gundlach, the fund's manager and TCW's chief investment officer. "These securities are undervalued," he told investors on a conference call this week.
Bigger was better at the end of 2007. Large companies in strong, predictable businesses were seen as bedrocks against a volatile market and an anticipated economic recession. U.S. exporters and other firms with international sales got a currency-related pop since their overseas revenues were worth more in U.S. dollars. Moreover, foreign sales would offset a domestic slump in consumer spending.
Stocks of all sizes have since been shellacked, but, true to form, many large-cap shares have held their own.
The big surprise is how well midsized stocks have fared since the end of March. Midcap shares -- companies with market values of between $1 billion and $10 billion that tend to be domestically focused -- have eclipsed their larger, more globally oriented rivals.
"Earnings growth is expected to be twice that for midcaps over large-caps," Stovall says. "It's a very good way for investors to play the growth potential and nimbleness of smaller-cap stocks, but also be able to maintain the defensiveness of large-caps."
Aim for the middle. S&P's midcap recommendations include Jacobs Engineering Group Inc. (JEC, Trade ), Superior Energy Services Inc. (SPN, Trade ) and IAC/InterActiveCorp. (IACI, Trade ). But don't neglect large-caps: S&P's "buy" list now includes Archer Daniels Midland Co. (ADM, Trade ), Oracle Corp. (ORCL, Trade ) and Chevron Corp. (CVX, Trade ).
As MarketWatch put it last November, when corporate earnings growth is scarce, investors price it like diamonds. The increasingly anemic U.S. economy has only strengthened the case for growth stocks.
What kind of growth stock? Stable growers, says Brian Belski, U.S. sector strategist at Merrill Lynch. "Companies, industries and sectors," he adds, "that are delivering consistent earnings growth."
Go for growth, particularly among large- and midcap companies. Nowadays, some of the best growth-stock opportunities are in the technology sector, which Belski says is "as cheap as it's been since 1990." He's especially bullish on the computer hardware and software, telecom equipment and semiconductor businesses.
At S&P, Stovall also expects solid growth from the energy, materials and industrials sectors, in companies such as Apache Corp. (APA, Trade ), Monsanto Co. (MON, Trade ) and Norfolk Southern Corp. (NSC, Trade )
"The check is in the mail" is a throwaway line, but when it involves shareholder dividends you're talking real money. Dividends are a cushion against market uncertainty and volatility, and income-minded investors count on it. That's why even when the going gets tough -- banks are a good example -- companies will slash dividends only as a last resort.
"Dividend-oriented stocks have been a safe haven and in times of turmoil investors want something tangible," says John Buckingham, editor of The Prudent Speculator newsletter.
Focus on companies that hike dividends and deliver on earnings. "There are lots of opportunities in dividend payers across numerous industry groups," says Buckingham, who also runs the Al Frank Dividend Value Fund (VALDX, Trade). Top picks include General Electric Co. (GE, Trade ), AT&T Inc. (ATT, Trade ) and Verizon Communications Inc. (VZ, Trade )
Toward the end of last year, weakness in both the dollar and the economy were knocks against U.S. stocks. Meanwhile, business growth in other developed markets appeared much stronger, spurring many strategists to emphasize stocks in Europe and Japan.
Nowadays, these markets have slumped along with the U.S., falling even more sharply in Europe. That's prompting some experts to shift allocations slightly in favor of U.S.-based companies, albeit firms with a global footprint.
"Make sure they're exporting," says Jim Swanson, chief investment strategist at mutual-fund company MFS. "This is what's holding the [U.S.] market up."
Even if the dollar strengthens, as some strategists expect, U.S. multinationals are still well-positioned. Shares of these firms are cheaply priced and the companies are posting higher profits, Swanson says. "They're selling their products to people with stronger currencies and their costs are under control, so they can get profit-margin growth from that."
Keep a broad horizon. U.S. multinationals that stand to gain market share are evident across many sectors, says Bob Doll, global chief investment officer of equities at money manager BlackRock Inc. In particular, he taps ConocoPhillips (COP, Trade ), Exxon Mobil Corp. (XOM, Trade ), International Business Machines Corp. (IBM, Trade ), Hewlett-Packard Co. (HPQ, Trade ), Monsanto and McDonald's Corp. (MCD, Trade )
Technology companies are attracting even more support than they did last November. The sector is roaring back and is among the top performers of the past three months.
Even with this strong showing, Swanson says, the tech sector's "free-cash-flow yields are some of the highest we've seen in 20 years relative to price, and price-to-earnings ratios are not much more than the market as a whole."
Moreover, companies are redoubling efforts to boost efficiency and productivity to combat rising manufacturing and sales costs. Hiring more workers is not management's first option, so firms instead are spending on tech to produce and distribute goods cheaper.
Increased energy and transportation costs also encourage companies to allow employees to work from home, which also benefits tech companies, says David Kelly, chief market strategist at JPMorgan Funds, the U.S. mutual-fund arm of JPMorgan Asset Management. "If you can't bring Joe to the office," he notes, "you have to bring the office to Joe."
Stay connected. Doug Couden, manager of the large-cap Phoenix Strategic Growth Fund (PSTAX, Trade), says he's sticking with last year's tech leaders, namely Apple Inc. (AAPL, Trade ) and Research In Motion Ltd. (RIMM, Trade ). The fund manager is also bullish on EMC Corp. (EMC, Trade ), Broadcom Corp. (BRCM, Trade ) and Corning Inc. (GLW, Trade )
The tech sector, Couden adds, offers global reach and corporate spending on technology is "holding nicely." He adds, "We like the relative growth we see in technology, and valuations are not out of line."
Consumer-staples stocks are supposed to be the safety caps on an unruly market, and in November they seemed essential defensive players in a portfolio. Yet many well-known food, drink and household products companies have fallen off the shelf so far this year: Coca-Cola Co. (KO, Trade ), for example, is down 12% since January; Procter & Gamble Co., down 11%
People have to eat and drink, of course, but staples companies face the twin hurdles of higher production costs and stiff overseas competition. "Profit margins are narrow," says Brad Sorenson, director of sector research at Charles Schwab & Co. "Even though the demand continues to be there, they're having trouble passing along increased costs."
Health-care stocks also have been feeble, although the sector has perked up recently and more strategists are warming to it.
"Earnings are coming in strong yet the price-to-earnings ratios are the same as the market," says Swenson, the MFS strategist. "Drug companies and biotech have a built-in growth market in that the populations of the world are aging."
A political cloud hangs over health care, especially big pharmaceutical stocks and managed-care organizations, and may be holding the sector back, but JPMorgan's Kelly says concerns that the federal government will constrain drugmakers, insurers and other industry players are overblown.
"If there's an expansion of government spending on health care," he says, "the private sector is going to benefit."
Go shopping. BlackRock's Doll recommends Johnson & Johnson (JNJ, Trade ), Aetna Inc. (AET, Trade ) and Pfizer Inc. (PFE, Trade ). At The Prudent Speculator, Buckingham says he's drawn to the pharmaceutical companies' outsized dividend yields, and suggests researching Merck & Co. (MRK, Trade ), GlaxoSmithKline Plc (GSK, Trade ) and Eli Lilly & Co. (LLY, Trade )
Many areas of the industrial sector should continue to roll ahead. The slumping dollar has improved the competitiveness of U.S.-based manufacturing, engineering and construction firms, which stand to benefit from a global spending boom on infrastructure.
"We're seeing a massive breakout in infrastructure investment in the emerging-market countries, and there is no way that is going to subside meaningfully," says Baumohl, the Economic Outlook Group strategist.
Assemble the parts. S&P's Stovall favors construction firms such as Jacobs Engineering Group and freight-haulers such as CSX Corp. (CSX, Trade ), Norfolk Southern, Landstar System Inc. (LSTR, Trade ) and Old Dominion Freight Line Inc. (ODFL, Trade ). Meanwhile, Buckingham spies bargains in beaten-down shares of General Electric Co. (GE, Trade ), 3M Co. (MMM, Trade ) and United Technologies Corp. (UTX, Trade )
The furious and vitriolic arguments for and against investing in the energy sector could probably power a small country. Are high oil prices due to lack of supply, intense speculation, a combination of both? Whatever the reason, oil, precious metals and commodity-related stocks have been gushers, and their recent parabolic surge troubles many analysts.
"This is more about speculation now than it is about fundamentals," says Belski, the Merrill Lynch strategist. Moreover, the fundamentals are deteriorating, he adds. "Return on equity and profit margins are rolling over," Belski says, "and that is what has us concerned."
Drive carefully. "We're recommending that investors take profits in the energy sector," says Schwab's Sorenson. "They may miss some on the upside, but we think that will avoid the risk of a pretty sharp downturn."
That said, even if the price of crude tumbles to $100 a barrel, the oil patch will still be profitable and in demand. Cheaper oil would favor refiners such as Tesoro Corp. (TSO, Trade ) and Valero Energy Corp. (VLO, Trade ) and healthy orders for new rigs helps drillers such as Noble Corp. (NE, Trade )
Couden, the Phoenix growth-fund manager, holds shares of oil and gas companies including Apache, Schlumberger Ltd. (SLB, Trade ), XTO Energy Inc. (XTO, Trade ) and Chesapeake Energy Corp. (CHK, Trade ), but he's avoiding the integrated majors such as Exxon and Chevron Corp. (CVX, Trade )
Says Couden: "These companies will be putting up significant growth on a relative basis. You need to have some exposure."
With banking and other financial services stocks in decline last November, the question was: When do you catch a falling knife?
Ask anyone who's tried, and they'll lick their wounds and tell you, "Not yet."
To be sure, plenty of money is on the sidelines -- would-be buyers waiting for the banks' and brokerages' fortunes to improve.
"There are some good values, but still too much risk," Schwab's Sorenson notes. "We'd rather pick them after they've gone up a bit and have stabilized."
Give some credit. "The financial sector is more than just banks and brokerage firms," says Jean-Marie Eveillard, the value-hunting manager of First Eagle Overseas Fund (FESOX, Trade).
He's bought shares of American Express Co. (AXP, Trade ) for its predictable fee-based business. Others are banking on mutual-fund companies and insurance firms. Hugh Johnson, chairman and chief investment officer of money manager Johnson Illington Advisors, is bullish on fund giant Franklin Resources Inc. (BEN, Trade ) and insurer Hartford Financial Services Group (HIG, Trade ), along with American Express.
You might also try your knife-catching skills. "There will be a time when we look back and say this was a phenomenal chance to buy Bank of America Corp. (BAC, Trade ), Barclays (BCS, Trade ), Hartford, Lehman Brothers (LEH, Trade )," says Buckingham of The Prudent Speculator. "There's so much pessimism and tremendous opportunity."
Welcome to the Reuters Before the Bell news mail.
Oh, that Goldman Sachs. The company, whose better-than-expected earnings might have kept Wall Street smiling yesterday, bummed out the market by warning that U.S. banks will have to raise up to $65 billion in capital to shore up balance sheets weakened by the mortgage crisis.
The bad vibes are still reverberating ahead of financial results from investment bank Morgan Stanley, and stock futures are pointing down.
The dollar is up against an index of major currencies, but reduced expectations of interest-rate increases are curbing the rally. U.S. Treasuries are lower.
After three days of declines, oil prices are up ahead of data expected to show a decline in U.S. crude stocks.
Pfizer shares are up after the company indicated it will be able to hold onto its U.S. marketing exclusivity for Lipitor - the world's best-selling drug - at least five months longer than Wall Street was expecting.
Until tomorrow,
Lisa Von Ahn
News Mail Editor
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Anybody tiered of the OTCBB and PINK Market Yet?
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price Quotes as of close November 16 2007
AAV currently 9.30 dollars a share 15% Divy price 11/20...$4.92
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PVX currently 9.50 dollars a share 15% Divy price 5/21 $...$4.97
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Welcome aboard to it's dividend Day!
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