DOW 10,000 AGAIN? EDITION
15 October 2009
DOW 10,000?
Are Earnings Making a Comeback?
As your reporter watched in jubilation as the ticker edged ever closer to the 10,000 mark Wednesday morning, she couldn't help but ponder: What will topping the 10,000 mark for the first time in more than a year — and a very turbulent year at that — mean to long-term investors?
As for the number itself — the effect may be, by in large, psychological, particularly for short-term investors. But behind the numbers? Well, that's a different story. There may be signs of a return to what many long-term, fundamental investors refer to as a "sweet spot" — increasing profit margins.
At the center of the rally was the report from JP Morgan that third-quarter profits not only surged, but exceeded analysts' expectations by a long shot. Intel's third-quarter earnings followed suit, though not quite as dramatically.
Onto this week's headlines . . .
SWEET SIX?
Profit Margins High on SC Member's List
Profit margins on the rise mean SC Member Lynn Ostrem can check off at least one item off on her "what she most looks for in a stock" list. Along with stable or increasing profit margins, this maverick fundamental investor also seeks:
SERVING UP THE GRAVY
Roster of Quality, Stock Screener Deemed "Starting Point"
Lynn, it seems, would be the ideal dinner guest: Enthusiastic, and not picky. Her favorite things about the StockCentral site? "Everything!" she gushed in an exclusive interview with your Gazette reporter earlier this week. "I love to price point on the data files. It makes everything else 'gravy.'
"My investment club uses the Complete Roster of Quality Companies and the Stock Screener every single month as our starting point to find new stocks," Lynn divulged. "We use the Sector/Industry screens to quickly compare our choices against their peers. And I've found some very helpful information in the research section."
Why are investors everywhere flocking to StockCentral? Your inquisitive reporter continues her cross-country journey in a determined search for the answers to this very question. To join in and add your own insights, please submit your comments to GazetteReporter@iclub.com.
FEELING A BIT UNDER THE WEATHER?
How Might Healthcare Brouhaha Affect Medtronic?
"Medtronic is the world's largest medical technology company with FY 2009 revenues of $14,599 billion, up a satisfying 8 percent," SC Member Armin Fields noted on the Medtronic Forum earlier this week. "Its primary products include those for cardiac rhythm disorders, cardiovascular disease, neurological disorders, spinal conditions and musculoskeletal trauma, urological and digestive disorders, diabetes, and ear, nose and throat conditions."
On the flip side, Armin also noted that, "MDT is involved in several legal disputes that might add additional uncertainty to its stock price. All it takes for the stock price to suffer is some bad news about patient injuries, or a new class action, or another governmental investigation."
Not to mention, this reporter notes, the fallout of the current healthcare debate. What sort of an impact do you think national healthcare reform might have on MDT as well as the overall industry? Visit the Forum to join in on the discussion and read Armin's blog post.
RESEARCH, RESEARCH, RESEARCH
Sector/Industry Screens Key in Stock Study
If the mantra for real estate is "location, location, location," this reporter feels at liberty to say that long-term investors might counter with "research, research, research" — a quest that is answered by the wide array of tools on the SC site, like the Sector/Industry screens, which allow members to:
TODAY'S ENTIRELY RELEVANT QUOTATION
"People are more comfortable with seeing this market rally further."
- Steve Goldman, Market Strategist at Weeden & Co.
in Greenwich, Conn., commenting on Intel and JPMorgan's
better-than-anticipated third-quarter earnings reports.
- View all the industries in any sector, along with key analysis ratios;
- View comparison ratios for all the companies in an industry;
- Sort industries by ratios to identify those with the highest overall quality or fastest average growth.
- Strong quality measures on the SSG
- Growth at a reasonable price
- Little or no debt
- Timely industry
- Favorable technicals