With this post I'm opening the books and giving you some insight into what I currently own, my thoughts about these particular stocks, and some insight into the performance to date. So, without further ado, and in no particular order, here we go...
1. Wal-Mart (NYSE: WMT) - Wal-Mart is a good stock in a sector that currently terrible. Retail stocks have been a bust over the last year, but Wal-Mart was one of the few that actually fared well. Aside from McDonald's (NYSE: MCD up nearly 6% in '08) Wal-Mart was the only Dow gainer for '08 (http://online.wsj.com/article/SB123085827075747869.html?mod=googlenews_wsj) with an 18% gain for the year. I see Wal-Mart continuing to flourish in '09 due to a continuing deterioration of the economy. Consumers will continue to seek low priced goods and Wal-Mart fits the bill better than just about any other retailer. Since purchase in early Dec. '08 I've a 6.64% gain on WMT before fees.
2. Caterpillar (NYSE: CAT) - See my Caterpillar post for insights on this stock. Since purchase in early Dec. '08 I've seen a 22% gain on CAT before fees. Not too shabby!
3. Chesapeake Energy (NYSE: CHK) - This stock was one that came recommended to me as a speculative value play and I didn't do much homework on it prior to purchase. Consequently, I bought it at $16.90/share right before some bad news came out and Cramer bagged the stock on his show and my supposed great value plummeted nearly 70%! Not to fear though, CHK is back on the upswing and recently got some good news with changes in how the SEC counts unproven natural gas reserves (http://uk.reuters.com/article/rbssEnergyNews/idUKN3028354420081230). This stock continues to have a huge upside, but it isn't for the faint of heart. Since I bought this one in early Dec. '08, I've seen it down around $9/share and up near $18/share. Currently it is at $17.20/share giving me a 6.9% gain before fees.
4. General Electric (NYSE: GE) - See my General Electric post for insight on this stock. Since purchase in early Dec. '08, I've seen a 6.92% gain on GE before fees.
5. Coca-Cola (NYSE: KO) - Coca-Cola seemed like a good stock to buy during these rough economic times since it offers a fairly recession proof product. No matter how bad things get, people can always find a buck for a soda. So far, that logic has served me alright. Since purchase in early Dec. '08, I've seen a 3.75% gain on KO before fees. Not a huge hitter yet, but still nothing to sneeze at.
6. Skyworks Solutions (NASDAQ: SWKS) - Purely a speculative play based on Cramer suggesting it as such on Mad Money. The stock was beaten down despite being the chip provider for Apple's (NYSE: AAPL) successful iPhone. After doing a little homework on the company I decided to roll the dice and shoot for a nice rebound. Since purchase in mid Dec. '08, I've seen an 18.43% gain on SWKS before fees. I still have this one pegged for at least a two bagger and maybe as much as a two and a half bagger depending on the rebound. I'm planning to sell this one as soon as I get what I want out of it.
7. Manitowoc Co. (NYSE: MTW) - See my Manitowoc Co. post for insight on this stock. Since purchase in early Dec. '08, I've seen a whopping 33.52% gain on MTW before fees!
Total portfolio: All purchase made early Dec. '08 or later. Total return to date is 12.74% before fees.
Showing posts with label CAT. Show all posts
Showing posts with label CAT. Show all posts
Friday, January 2, 2009
Sunday, December 7, 2008
Caterpillar
Time for the second installment of "let's pick apart my portfolio"... this time we're going to discuss Caterpillar, Inc. (NYSE: CAT).
Caterpillar is an industry leader in heavy machinery used in the construction, mining and forestry industries, as well as being an engine manufacturer and financier of the products it sells. While the U.S. market for construction has slowed recently, CAT is a global company and has seen strong growth in emerging markets such as China. This has allowed CAT to remain profitable in each of the last 10yrs I looked at.
The primary reason I chose to look at CAT is because they build the equipment that builds our infrastructure... notice a hot trend here?
Management: While I don't know nearly as much about the management of CAT as I did about GE, I know enough to say that this company appears to be in good hands. They have a reputation of issuing dividends, buying back shares, and they have been profitable and growing over the last 10yrs.
Financials: I'll spare you from the math, but this stock appears to be greatly undervalued at the time of this blog. At the time of purchase, CAT was down to $38.45/share, while the relative value I calculated is up around $134.89/share. The 52-week low was $31.95/share and the 52-week high was $85.96/share, and I calculated an initial rate of return of 14.95% and an annual growth rate of 3.98%. While these rates weren't quite as attractive as GE's, they still looked very good to me.
Outside Factors: Once again, I'm going back to the incoming president's plan to fix our roads, bridges, and mass transit systems (although I'm not sure Detroit's People Mover or SMART Bus system really qualify as mass transit). In my eyes, this says orders for new equipment capable of upgrading these systems is coming soon.
Performance to Date: So far, nothing... I bought at $38.45/share about a week ago, and as of this post, it sits at $38.40/share. In this market, that might not be such a bad thing though. I still think this stock is poised to take off, but it may not be for a few more months, or even a year depending on how quickly things happen with the new administration.
Caterpillar is an industry leader in heavy machinery used in the construction, mining and forestry industries, as well as being an engine manufacturer and financier of the products it sells. While the U.S. market for construction has slowed recently, CAT is a global company and has seen strong growth in emerging markets such as China. This has allowed CAT to remain profitable in each of the last 10yrs I looked at.
The primary reason I chose to look at CAT is because they build the equipment that builds our infrastructure... notice a hot trend here?
Management: While I don't know nearly as much about the management of CAT as I did about GE, I know enough to say that this company appears to be in good hands. They have a reputation of issuing dividends, buying back shares, and they have been profitable and growing over the last 10yrs.
Financials: I'll spare you from the math, but this stock appears to be greatly undervalued at the time of this blog. At the time of purchase, CAT was down to $38.45/share, while the relative value I calculated is up around $134.89/share. The 52-week low was $31.95/share and the 52-week high was $85.96/share, and I calculated an initial rate of return of 14.95% and an annual growth rate of 3.98%. While these rates weren't quite as attractive as GE's, they still looked very good to me.
Outside Factors: Once again, I'm going back to the incoming president's plan to fix our roads, bridges, and mass transit systems (although I'm not sure Detroit's People Mover or SMART Bus system really qualify as mass transit). In my eyes, this says orders for new equipment capable of upgrading these systems is coming soon.
Performance to Date: So far, nothing... I bought at $38.45/share about a week ago, and as of this post, it sits at $38.40/share. In this market, that might not be such a bad thing though. I still think this stock is poised to take off, but it may not be for a few more months, or even a year depending on how quickly things happen with the new administration.
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