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Posted
Mar 23 2009, 08:42 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
Has anyone else noticed that there's still a lot of hand-wringing going on -- mostly about General Electric's (GE) GE Capital unit?
Over the weekend, a BernsteinResearch analyst trimmed his earnings estimate for 2009 from $1.18 to $0.81. In addition, Deutsche Bank lowered its estimate for the year from $1.20 to $0.97. Obviously, I don’t think that's good news - especially since we're not talking about a couple of bucks here. But am I the only guy who sees value here and thinks the bad-mouthing the company's been receiving is overdone? To wit:
1. These guys trade under $10, or at least closed there on Friday.
2. Insiders have been buying the shares, and -- even if it pays a quarterly dividend of $0.10 -- its forward yield (based on Friday’s closing price) would still be north of 4%, by my math.
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Posted
Apr 27 2009, 10:06 AM
by
Louis Navellier
Rating:
Money Blog: Top Stocks Blog - MSN Money
Fortune magazine is out with its updated list of top 500 companies
in the country.In the old days, that was a list that meant something to investors.Some investors, in fact, even used it as a list of recommendations. Today, that strategy would be foolish. Just look at some of the top names -- General Electric (GE), General Motors (GM), ConocoPhillips (COP). Not exactly profit-makers for shareholders. Will these companies turnaround? Sure, some of them will. But don't let the cheap prices of these big names lure you into thinking you can own a guaranteed slam dunk at a dirt cheap price. As with any investment, you have to look at each Fortune 500 company on its own merits. Here are five Fortune 500 companies to steer clear of
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Posted
Mar 20 2009, 12:34 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
General Electric's (GE) "deep dive" yesterday did involve a lot of numbers and slides. But judging by the tone of analysts' reactions, the Street is still taking the company's word for it. The assertion that GE Capital will be profitable this year even under a worst-case scenario (leaning heavily, one presumes, on the fact that it doesn't mark to market) is being taken as gospel. The prevailing analyst reaction appears to be: Cut earnings a bit, cut price target a dollar or 2, remain neutral on the stock.
I find it hard to see how you can be neutral on this company. If you believe what management is telling you, and if you believe in the business model, the stock seems to be an unstoppable earnings powerhouse, even in the worst of times, and should be bought aggressively.
Now, I don't think too many people really believe this. But few are willing to say "the company has repeatedly changed its tune, and we have no reason to believe it won't again."
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Posted
Jul 27 2009, 12:54 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
For US-centric investors who question whether it’s really necessary to invest in “risky” overseas markets, here’s an important fact to consider: It’s China -- not the United States -- that’s leading us back from the brink of a global financial collapse. At a time when the US economy continues to wrestle with joblessness, a housing hangover, and heightened inflationary fears due to a questionable central bank “exit strategy,” Beijing just reported that China’s economy advanced at a 7.9% clip in the second quarter, up from 6.1% in the first quarter. This is well ahead of what most mainstream analysts had been projecting -- particularly those who were writing the Red Dragon’s eulogy back in January. But as I’ve been saying since the start of the New Year, China could well be on track for growth of 8% or more this year. If you factor in the cash that’s not included in official state statistics -- but that does influence economic growth -- it’s possible that China’s growth rate could grow by an additional 3% this year and as much as 5% in 2010.
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Posted
Sep 17 2009, 03:14 PM
by
Anthony Mirhaydari
Rating:
Money Blog: Top Stocks Blog - MSN Money
With the major indices trading near new highs, there is evidence that the most recent phase of the advance was fueled by the lowest quality stocks. And it looks like the tide could be turning.
Some of this has been caused by a scramble into the riskiest holdings out on fear of missing out on the rally and a desire to maximize exposure to the broad market. Short covering has played a role too as many of the best performers are among the most heavily shorted names. While this doesn't preclude additional gains, it does call into question the longevity of the rally.
According to Matthew Rothman of Barclays Capital, the end may be upon us. In his words: "Quality continues to underperform sharply, turning in one of the longest losing streaks in the index's nearly sixty year history. Wednesday saw the streak end."
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Posted
Mar 12 2009, 11:11 AM
by
Anthony Mirhaydari
Rating:
Money Blog: Top Stocks Blog - MSN Money
After more than 50 years, industrial giant General Electric (GE) lost its AAA credit rating on Thursday. Standard & Poor's downgraded the company one notch to AA+ on concerns over the health of its finance arm. Shares were up big after the announcement as investors reacted positively to the removal of a big source of uncertainty.
GE has been pulled down by its GE Capital financial unit. Involved in aircraft leasing, credit cards, and home mortgages, the unit was a big contributor to profits recently as the company used its AAA rating and low cost of capital to engage in bank-like activities. Now, just like the banks, GE faces earnings pressure as the global recession deepens and credit losses mount.
The bearishness surrounding GE Capital was overdone. A Deutsche Bank analyst recently estimated that GE's industrial units, which together generate 50% of earnings, are alone worth $12 a share. With shares at $9.70, down 75% from the 2007 peak of $38.95, investors are assigning a negative value to GE Capital on fears it's severely undercapitalized. This seems a bit harsh, given that GE Capital is now one of the highest rated financial services firms in the world.
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Posted
Mar 05 2009, 10:21 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 You really have to feel badly for Greenbrier (GBX), whose shares are down 33% Thursday after devastating news that General Electric (GE) might pull its business.
See, Greenbrier's been working for 15 months on a huge contract with GE's railcar division (yes, GE leases railcars to companies). GE was going to buy nearly 12,000 new railcars from Greenbrier over the next eight years -- that's about 75% of Greenbrier's backlog. Deliveries of the railcars started in December, and Greenbrier must have been ecstatic at finally getting the first shipments out the door. But now, GE is imploding,
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Posted
Sep 01 2009, 03:51 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Vanity Fair has announced its “New Establishment 100″ list for 2009, basing selections on wealth, influence, and philanthropy, as well as such intangibles as vision and "X factor.”
Topping the list is Goldman Sachs (GS) chief executive Lloyd Blankfein. Apparently, the big pay packages that he and his top executives get are not enough to erode his power in the business community. Blankfein was in the No. 2 spot a year ago.
Second on the list is Steve Jobs, chief executive of Apple (AAPL). He should arguably be at the top. He is clearly the most influential and powerful chief executive in America, taking a role that Jack Welch of General Electric (GE) once had.
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Posted
Aug 06 2009, 12:28 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
This article was written by Minyanville's Megan Barnett If you knew that you might only have to pay $1,000 if you got caught committing securities fraud that would net you $100,000, would you do it? What if I said you could pay the grand and not admit guilt? Would you do it then? These may not the precise questions that C-suite executives ask themselves when they decide to travel down that fateful path of securities fraud, but given the example set by the Securities and Exchange Commission, perhaps they should. This week, the SEC reached settlements with two corporate giants: Bank of America (BAC) and General Electric (GE). The congratulatory announcements by the SEC made the regulators seem like tough cops on the beat. Bank of America paid $33 million to settle charges it misled investors about the billions in bonuses it agreed to pay Merrill Lynch employees after acquiring their firm. And General Electric paid out $50 million put an end to the allegations of accounting fraud. (View Slideshow: The Small Price to Pay for Financial Fraud) Now, $83 million sure sounds like a lot, especially in times of empty government coffers and bankrupt municipalities. But in the world of Wall Street and multi-billion dollar corporate conglomerates, it's all about perspective.
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Posted
Mar 06 2009, 02:08 AM
by
Bernhard Warner and Matthew Yeomans
Rating:
Money Blog: Top Stocks Blog - MSN Money
This post comes from partner site The Big Money.
General Motors (GM) is now thinking about the benefits of bankruptcy -- as long as it's speedy and the government can finance it, the Wall Street Journal reports this morning. Last month, the ailing carmaker claimed Chapter 11 would be far more costly as it lobbied for make-or-break bailout No. 2. "The change in thinking, combined with the disclosure Thursday that GM's auditor has raised 'substantial doubt' about the car maker's ability to keep going, appears to move GM closer to the possibility it will file for reorganization," the newspaper writes. Part of the change of heart is that GM is playing a game of beat-the-clock. It is not only locked into tense negotiations for an additional $30 billion in aid, but it also must close a deal with its bondholders by the end of the month. The bankruptcy route -- a sort of nuclear option -- could "prod bondholders into making concessions," the WSJ figures.
There's no denying things look bleak at GM. On Thursday auditors slapped a "substantial doubt" tag on GM's windshield, saying even if it received the entire $30 billion it hoped to borrow from the federal government, survival is far from guaranteed, the New York Times writes. BusinessWeek doesn't help GM's case, pointing out that the carmaker's pitch for aid is partly based on a projection that the auto-buying market will return to boom time levels within three years
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