| SELL | | Ciena | CIEN-Q | 6.040 | Has benefited from an upsurge in interest in telecom equipment stocks. The stock is extremely expensive. Would have to grow their revenues 15% over the next eight to 10 years to justify the current valuations. | 2003-10-27 | |
| BUY | | H. J. Heinz Co. | HNZ-N | 34.980 | A good consumers staple company and pays a good dividend. Trading at about 16 times earnings. The last quarters indicate a fairly good job. Has introduced new products and has cut costs. Current price is attractive. | 2003-10-27 | |
| BUY | | Hewlett-Packard Co | HPQ-N | 21.000 | Could be an interesting value play. One of the few tech stocks that are reasonably valued. Trading at 15 X next year's earnings. Their service industry is growing and is profitable. Facing competition from Dell. If it gets mid-to high $20's, sell. | 2003-10-27 | |
| BUY | | Oracle | ORCL-Q | 11.700 | Will be weighed down by its proposed acquisition of People Soft. Decision not likely until mid-December. Generates tremendous cash flow and has a strong balance sheet. Not cheap but attractive on a free cash flow basis. | 2003-10-27 | |
| DON'T BUY | | Ford Motor | F-N | 12.020 | Negative on the long-term outlook for North American auto manufacturers. Prefers GM over Ford. Extremely large debt. | 2003-10-27 | |
| BUY | | General Motors Corporation | GM-N | 42.270 | Negative on the long-term outlook for North American auto manufacturers. Prefers GM over Ford. From a cash flow perspective, doing quite well. | 2003-10-27 | |
| DON'T BUY | | JDS Uniphase | JDU-T | 4.710 | Very expensive. Trading at 6 X forward sales. Business trends for their core products has stabilized, but at a very low level. No growth. Keeps going lower and lower chasing a breakeven point. | 2003-10-27 | |
| WEAK BUY | | Nortel | NT-T | 5.620 | Not cheap. Could have some upside. Has a small place in a higher risk portfolio. | 2003-10-27 | |
| BUY | | Motorola | MOT-N | 13.070 | Expects more upside. Have lost some competitiveness, particularly in handsets. Now making some good news, e.g. replacing the CEO. Planning to spin off their semiconductor business, which will allow them to refocus capital into more productive areas. | 2003-10-27 | |
| BUY | | Walt Disney | DIS-N | 22.140 | Seems to be consolidating in the $22 range. Sees good value in media stocks and the stock should benefit with improved margins. Because of the elections, can see an increase in advertising. | 2003-10-27 | |
| HOLD | | DTE Energy Company | DTE-N | 36.500 | Have found utilities in the US to be a very tough sector. About 80% of its business is regulated. About 5% dividend yield. IRS is looking into an area that could cost them five cents a month. | 2003-10-27 | |
| DON'T BUY | | Lucent Technologies | LU-N | 2.750 | Has always been behind the curve in fixing its cost structure. Nortel is strong competition for the baby Bell contracts. | 2003-10-27 | |
| DON'T BUY | | Cisco | CSCO-Q | 19.930 | A bit expensive at this time. Has a lot of cash. Needs some revenue growth. | 2003-10-27 | |
| BUY | | Pfizer Inc | PFE-N | 30.970 | Pharmaceutical sector has been very frustrating. OK buy for a long-term investment. Could still be some downside. Expecting to file 22 to 25 new drugs between now and 2006. Generates tremendous cash flow. Earnings visibility is good. | 2003-10-27 | |
| BUY | | Union Pacific Corp | UNP-N | 59.900 | Transportation sector is a good area to be in now. Have a very good operating ratio. As the economy picks up, you’ll see more of the revenue fall to the bottom line. Lower fuel prices would give a good upside. | 2003-10-27 | |
| VAGUE | | Seagate Technology | STX-N | 21.000 | Started showing some market share losses in enterprise disc drives. SCC has asked for some reports, which is not a good sign. Insiders hold about 63% of the shares and had talked about selling a large amount. | 2003-10-27 | |
| TOP PICK | | Johnson & Johnson | JNJ-N | 49.920 | A contrarian play. Has performed very well from a financial perspective. Growth prospect is a very positive. Very good long-term value. | 2003-10-27 | |
| TOP PICK | | Viacom Inc. (B) | VIA.B-N | 38.900 | The leading media stock in the US. Have some valuable properties. Stock has been hurt by concerns on local advertising. A good buying opportunity. | 2003-10-27 | |
| TOP PICK | | Marsh & McLennan | MMC-N | 45.100 | Stock has been sold off and the valuation is as good as it has been for the last few years. | 2003-10-27 | |
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