| TOP PICK | | Boeing | BA-N | 65.590 | Will get another shot at the government's tanker contract. Turmoil in the airlines business but not in airplane manufacturing. Airlines need newer aircraft. Good price. | 2008-07-09 | |
| TOP PICK | | Transocean Inc. | RIG-N | 144.320 | Largest offshore drilling company globally with 140 rigs. Not that sensitive to the commodity. Now renting out some of their rigs for over $600,000 a day. About 5 years of backlog. Financially strong and trades at a low multiple. | 2008-07-09 | |
| TOP PICK | | Parexel International Corp. | PRXL-Q | 25.900 | Contract research that does clinical drug trials for major drug companies. Strong growing franchise. | 2008-07-09 | |
| Comment | | CitiGroup | C-N | 16.440 | Thinks they can earn $2.50 or $3 a share. Can be included in a well-diversified portfolio. | 2008-07-09 | |
| BUY | | Apple | AAPL-Q | 174.250 | Ipod 3G being introduced globally is international news. Still sees it as good value. | 2008-07-09 | |
| BUY | | United Technologies | UTX-N | 61.120 | Diversified industrial with much of their business being international. Have good growing businesses. Very good price. | 2008-07-09 | |
| DON'T BUY | | Visa Inc. | V-N | 75.870 | Trading at about 30X earnings, which is a little rich. He would prefer it at 20X earnings. Great business. No credit risks. | 2008-07-09 | |
| DON'T BUY | | General Motors Corporation | GM-N | 10.330 | As a contrarian play, this would be well down on his list. Today's business model is in question. There are issues of survivability. | 2008-07-09 | |
| BUY | | Goldman Sachs | GS-N | 169.020 | Very good entry point. Only 17%-18% is Capital Market business. ROE averages about 20%. | 2008-07-09 | |
| DON'T BUY | | D R Horton Inc. | DHI-N | 10.100 | US homebuilder. Have been hurt because of the housing demise. A little bit early to get into this area. | 2008-07-09 | |
| DON'T BUY | | Microsoft | MSFT-Q | 29.930 | Lots of good choices in the US technology space. Company is obviously a huge successful one, a cash cow bringing in a tremendous amount of cash each year, but it is coming off a product that is becoming older and older technology. Desperately trying to move into the Internet age. Better opportunities such as Google (GOOG-Q), Cisco (CSCO-Q), Oracle (ORCL-Q) or Apple (AAPL-Q). | 2008-05-14 | |
| DON'T BUY | | Visa Inc. | V-N | 82.230 | A processing company that gets paid on the volume of transactions. There are no credit risks. A little bit too expensive and a little bit too hot off the IPO. | 2008-05-14 | |
| DON'T BUY | | Pfizer Inc | PFE-N | 20.060 | Recently sold his holdings. A lot of their pipeline is going into generic distribution, which will take a lot of revenue off the top line. Feels the 6% dividend is probably safe. | 2008-05-14 | |
| DON'T BUY | | Tesoro Petroleum Corp | TSO-N | 25.000 | Refiners are probably the worst place to be in the energy space. Their cost is oil, which is expensive. Margins are being squeezed. There is so much opportunity in the energy space that it doesn't make a lot of sense to fight through the problems that the refiners have. Likes offshore drillers such as Transocean (RIG-N) or Halliburton (HAL-N) | 2008-05-14 | |
| BUY | | Apple | AAPL-Q | 186.260 | Very volatile stock. Growing revenues at 30% to 35% year-over-year. Probably the best branding company in the world. At current price they are trading at 28X fiscal 09 earnings. If you buy today, you can expect that the stock price over time will mirror the organic growth of the earnings. | 2008-05-14 | |
| DON'T BUY | | Hewlett-Packard Co | HPQ-N | 45.640 | Acquiring Electronic Data Systems (EDS-N) but not sure it's a great deal for them. Services business is a lower margin business than the PC business. | 2008-05-14 | |
| Comment | | IBM | IBM-N | 127.520 | Has been very successful by sticking to its knitting and concentrating on the services business. Very profitable. | 2008-05-14 | |
| BUY | | Bank of America | BAC-N | 36.800 | Banking industry has been in an amazing turmoil. There is a pending purchase of Countrywide (CFC-N) and there is talk that it might be revalued. Think they will do well longer-term. | 2008-05-14 | |
| TOP PICK | | Boeing | BA-N | 85.690 | Dreamliner is behind schedule but it is coming. There is going to be a fantastic new revenue cycle for the company, probably out to 2012, 2013. Biggest backlog for any aircraft in history. Margins are up which means they are going to have a great revenue cycle. | 2008-05-14 | |
| TOP PICK | | Kendle International Inc. | KNDL-Q | 37.110 | Clinical research organization that does drug trials phase 1 through 4. They manage the regulatory side of the trial. Has been a very successful company. Stumbled a little bit on one-time costs and is trading below its peer group and its own historical multiples. | 2008-05-14 | |
| TOP PICK | | priceline.com Inc. | PCLN-Q | 138.290 | An Internet-based travel site growing dramatically. Since 2005, revenues have more than doubled. Earnings have gone up sevenfold. Multiple is pretty much static. | 2008-05-14 | |
| STRONG BUY | | Cisco | CSCO-Q | 25.140 | A tremendous growth story. Looking for 20% growth in earnings. They are at the sweet spot of the technology revolution. Trading at only 14X earnings. Could easily trade at 22 or 25 times earnings. | 2008-03-12 | |
| BUY | | General Electric | GE-N | 33.960 | Has continued to grow its earnings at about 10%. In a very good economy, that might ratchet up to 13% or 14%. Longer term, this stock will get organic growth in the 10% to 13% range, which will allow the stock price to grow at 10% or 13%. | 2008-03-12 | |
| BUY | | Bank of America | BAC-N | 37.030 | Very good franchise and well capitalized. The jury is out on the Countrywide acquisition. Doesn't think you will be able to judge this well for 2 or 3 years. They will be a very big player in the mortgage business, which is the reason for their acquisition. Thinks the 6.9% dividend is safe. | 2008-03-12 | |
| Comment | | Paychex | PAYX-Q | 31.660 | Has always thought this was too expensive. | 2008-03-12 | |
| DON'T BUY | | Altria Group Inc | MO-N | 73.660 | Doesn't own this one because of his stand on ethics. If you are buying something that is swimming upstream in terms of cultural and moral issues, it has to be a consideration. | 2008-03-12 | |
| BUY | | Johnson & Johnson | JNJ-N | 62.550 | Wonderful company. Great management. Very strong balance sheet. Gives a bit of exposure in the Pharma and medical supply businesses as well as the consumer business. A good core holding. 2.65% yield. | 2008-03-12 | |
| BUY | | Goldman Sachs | GS-N | 163.010 | Being hurt along with the other investment management businesses. Really doesn't have a large business in the capital markets area. About 70% of revenues and earnings come from proprietary trading activity, only 17% from capital markets. Trading at less than 10X earnings for 2008 and 7X for 2009. Trading at about 1.6 price to book. | 2008-03-12 | |
| TOP PICK | | Apple | AAPL-Q | 126.030 | Probably one of the world's greatest branding companies combined with a great technology company. Continues to gain market share. Mac represents about 50% of their business but iPod and iPhone, the other 50%, are doing very well. Trades at less than 20X next year's earnings. Growing revenues at 30%/35%. | 2008-03-12 | |
| TOP PICK | | Oracle | ORCL-Q | 19.680 | A database and middleware software company. Management is a master at acquiring companies and merging them into the culture. Expecting $1.25 in earnings in 08 and $1.45 in 09. Beating the competition hands down. | 2008-03-12 | |
| TOP PICK | | Halliburton Co | HAL-N | 37.920 | Oil services. Just recently spun off the unit that was involved in the Iraqi construction area. More and more of the budgets of large integrated oil companies are going to exploration and this company gets its share. Trades at very reasonable multiples, 13X this year's earnings and 11X next year’s. | 2008-03-12 | |
| DON'T BUY | | Microsoft | MSFT-Q | 28.630 | Once we move through this bear market, technology is often a leader coming out. There are a lot of great technology companies, but he is not sure this one would be at the top of his list. Growth rates have dropped. Acquisition of Yahoo (YHOO-Q) would be very risky. | 2008-03-12 | |
| BUY | | Boeing | BA-N | 72.450 | In a global sweet spot with the expansion reach to Asia. There is almost an unlimited market there. Good opportunity for a long-term investor. | 2008-03-12 | |
| DON'T BUY | | McDonalds | MCD-N | 51.010 | Have done a very good job of turning it around. Have taken Starbucks on in the coffee category. He prefers buying companies that are trading at the lower end of the channel of valuations. This is trading at about 16X earnings rather than the 12X or 13X that he prefers. | 2008-01-30 | |
| Comment | | Burlington Northern Santa Fe | BNI-N | 84.290 | Rails are cycle stocks. If the market has fully priced in a recession, what should we be buying when coming out of the recession. Rails are a great place to be along with trucking. | 2008-01-30 | |
| HOLD | | Bank of America | BAC-N | 42.210 | Any time a whole industry is hurt, make sure you are well balanced and that you don't have too much of a bet on an industry or sector. Then you hang on until you get into a normalized period. | 2008-01-30 | |
| BUY | | FedEx | FDX-N | 92.040 | This is really a proxy for the US economy. Good value here. Longer-term fundamentals are very good. Growing at about 15% a year. Trading at 13X earnings. Have been able to pass on fuel surcharges. Have an operation in China, which has huge potential. | 2008-01-30 | |
| BUY | | General Electric | GE-N | 34.936 | Great company. Very well managed. Will grow at around 10%-13% and trade at about 14X earnings. 3.4% yield. | 2008-01-30 | |
| TOP PICK | | Apple | AAPL-Q | 132.180 | Numbers were really good at $1.76 versus $1.64. In addition to coming out with their earnings. On their guidance, they under promised in the market reacted negatively. Historically have always under promised but outperformed. | 2008-01-30 | |
| TOP PICK | | Walt Disney | DIS-N | 29.410 | Stock price has fallen 25%. This is a very well run company. Fundamentals are very good and valuation is very sound. | 2008-01-30 | |
| TOP PICK | | United Technologies | UTX-N | 72.750 | Broadly based industrial company and very predictable. Thinks it will grow with the market. Growing at 10% to 13%. Doesn't thinks the US consumer will have a big effect on this company. | 2008-01-30 | |
| DON'T BUY | | Walgreen Co | WAG-N | 34.320 | 2nd largest drugstore chain in the US. Having some problems with cost containment. They are also in a very tight pricing environment. Growing at about 10%/12% and trading at about 15X earnings so he would not be an owner of this one. | 2008-01-30 | |
| PAST TOP PICK | | Goldman Sachs | GS-N | 198.550 | (A Top Pick Oct 16/07. Down 11.7%.) Did pretty well in the subprime market and even made some money off it. A great reason to buy them. Unlike a lot of the other brokerages, it isn't built around M & A activities, underwriting and capital markets. 70% of their business comes from principal trading. Trading at about 7X earnings. | 2008-01-30 | |
| PAST TOP PICK | | Cisco | CSCO-Q | 24.360 | (A Top Pick Oct 16/07. Down 32.6%.) Was trading at 12.5X earnings which is outrageous on a company that is growing revenue at 16% and earnings at over 20%. A tremendous buy. | 2008-01-30 | |
| PAST TOP PICK | | UnitedHealth Group Inc | UNH-N | 50.160 | A Top Pick Oct 16/07. Up 21.6%.) Health maintenance organization. Doing very well and will be earning over $4 a share in 08. Well managed company. Good sector. Still a Buy. | 2008-01-30 | |
| DON'T BUY | | Bank of America | BAC-N | 43.430 | For a long-term investor, a toe in the water of banks is not necessarily a bad thing, but there is no great hurry. Wait for the skies to clear a little bit. | 2007-12-12 | |
| DON'T BUY | | CitiGroup | C-N | 31.470 | One of the world’s largest banks. A great franchise. Thinks it could make $4 a share on operating earnings on an ongoing basis and it's trading at $30. When the skies clear he thinks there will be good opportunities. Don't make any assumption that dividends will not be cut. New CEO will be the catalyst on this. | 2007-12-12 | |
| Comment | | Pfizer Inc | PFE-N | 23.810 | Pharma as an industry as a model is really at a crossroads. The chemical-based side is giving way to the biology-side of science. They have a lot of money, but do not have a good pipeline. The biology side is just the opposite. They have the largest phase 2 pipeline that they've ever had and that could translate by 2009 into the biggest phase 3. They own some, but are tempted to pull the plug. | 2007-12-12 | |
| Comment | | Microsoft | MSFT-Q | 34.470 | Been doing fairly well for quite a long time and yet stock hasn't. Been in a trading range. Valuations were growing at about 10%-12% but multiples were too high. Takes a long time for multiples to come back to reality but thinks they have now done so. If he had to choose amongst technology, he has a world of choice and this one probably would not be his top one. | 2007-12-12 | |
| DON'T BUY | | Pepsi | PEP-N | 78.090 | This is a good company and has been doing fairly well. The difficulty he has with this one and a lot of the consumer staples is that they are fairly expensive. | 2007-12-12 | |
| TOP PICK | | American International Group | AIG-N | 58.210 | 5-year growth targets are 10% to 12% on the earnings side. Doesn't have a lot of exposure to the financial problems. Trades at 8.5X earnings. Extremely cheap historically. Cheap because it's a financial and all financials are going out with the bathwater. | 2007-12-12 | |
| TOP PICK | | General Electric | GE-N | 37.250 | A fantastically managed company. They target 2 and 3X to GDP for organic growth so that puts them in the 10% to 13% range. About 50% of the company is GE capital so is painted with the same brush as financials. Has a wonderful dividend. | 2007-12-12 | |
| TOP PICK | | Transocean Inc. | RIG-N | 138.660 | The largest offshore drilling company in the world. Even though it might trade with some sensitivity to oil, it's really not sensitive to the commodity in terms of its results. Have about 146 rigs and do about $10 billion in sales. They have $33 billion in backlog, 3.5 years of revenue. | 2007-12-12 | |
| Comment | | Stryker Corp. | SYK-N | 74.700 | In a demographic sweet spot doing replacement hips, knees etc. Has been doing extremely well over time and expects it will continue to. Would prefer Zimmer (ZMH-N) because of the valuation and the growth rates. | 2007-12-12 | |
| BUY | | Zimmer Holdings Inc. | ZMH-N | 67.980 | Replacement hips, knees etc. good demographic stock. | 2007-12-12 | |
| BUY | | Johnson & Johnson | JNJ-N | 67.700 | A very sound financial company, growing its earnings at 8% to 10% per year. Trades at about 15X earnings. 2.5% dividend yield. Pristine AAA balance sheet. A very stable holding. | 2007-12-12 | |
| BUY | | CitiGroup | C-N | 44.790 | Has just come out with earnings, and have written off 3 million dollars (announced earlier), are also suspending their buyback, and there may be more write offs coming.
Trading at less then 10X next years earnings and has a 4.5 % dividend yield. Can be viewed as a "free call" on the stock.
| 2007-10-16 | |
| BUY | | Pfizer Inc | PFE-N | 24.630 | Trading at a very attractive multiple (less then 10X next years earnings), 4.5% dividends. They have a lot of things going on in the pipeline. Must be patient with this though. | 2007-10-16 | |
| SELL | | Deere & Co. | DE-N | 151.040 | Has been hot. Built on the commodity cycle. Fears that this has become a momentum stock, where it should be treated as a cyclical. | 2007-10-16 | |
| VAGUE | | Coca-Cola Company | KO-N | 57.760 | Great Francaise, wonderful company.
Has an international present. (good with a weak US dollar).
Thinks it might be a bit overvalued. | 2007-10-16 | |
| TOP PICK | | Goldman Sachs | GS-N | 224.830 | trading at 2 times Bookvalue, thinks it could go to 2.7 times book.
| 2007-10-16 | |
| TOP PICK | | Cisco | CSCO-Q | 32.290 | Wonderful time for a company like Cisco, the "plumber of the Internet".
Stock is trading at very reasonable rate. Cisco is at a sweet spot.
Internationally as well as domestically. Only 25% of the households in the US are on broadband, so there is a huge up side.
| 2007-10-16 | |
| TOP PICK | | UnitedHealth Group Inc | UNH-N | 48.500 | Both a valuation and a growth story.
On the growth side, 18% this year, 16% next year.
Biggest risk is medical cost rising without the abilities to raise revenues. (unlikely). | 2007-10-16 | |
