LET’S TALK STOCKS MEETUP HAS BEEN CANCELLED due to BAD weather conditions and expected SMALL attendance. I will find another date and time to have the meetup. Stay tuned for more!
Here are all the stock picks for this coming meetup (Saturday February 21, 2015):
ACE Limited (NYSE:ACE)
Apple Inc. (NASDAQ:AAPL)
In this meetup we discussed the following stocks:
ACE Limited (NYSE:ACE):
Summary: ACE has shown strong revenue growth, strong stock price performance, solid financial position with low debts, and attrative valuation level with growth in EPS. Downside is they have low profit margins and ROE.
Canadian National Railway Company (TSE:CNR):
Summary: The company is overvalued in terms of price, however, the stock has strong profit margin and ROE. Railway industry may also be favourable in the future as trains will be used to ship oil and lumber as housing improves.
Encana Corporation (TSE:ECA):
Summary: The stock has been beaten up, it has an attractive price, and is a good watch as oil could rise in the future.
Exxon Mobil Corporation (NYSE:XOM):
Summary: The stock is fairly undervalued, it has shown strong price performance and has an attractive dividend.
Foot Locker (NYSE: FL):
Summary: The company has a strong ROE, low debt to equity ratio. The stock is up 40% and has a yield of 1.6%. Cash per share has also doubled, and ROA is at an attractive 13.65%.
The information below are votes on the stocks we have discussed in the meetup. The percentages show how many people would invest in the company.
ECA: 84% said yes they would invest.
XOM: 67% said yes they would invest.
ACE: 100% said yes they would invest.
CNR: 50% said yes they would invest.
FL: 34% said yes they would invest.
If you would like more information on the stocks, please send Daniel a message and he will direct you to the right person.
Before the next meetup, please fill up this survey: https://www.surveymonkey.com/s/K6TWL9M
I hope to see everyone in January! Happy Holidays and Happy New Year!
Here is all of the stock picks for this Saturday. I will see you all soon!
- ACE Limited (NYSE:ACE)
- Canadian National Railway Company (TSE:CNR)
- Encana Corporation (TSE:ECA)
- Exxon Mobil Corporation (NYSE:XOM)
Companhia Energetica Minas Gerais (NYSE:CIG)
Brookfield Asset Management Inc. (NYSE:BAM)
- Netflix, Inc. (NASDAQ:NFLX)
American International Group Inc (NYSE:AIG)
Bancorp Inc (NASDAQ:TBBK)
Companhia Paranaense de Energia (NYSE:ELP)
Pizza Pizza Royalty Corp (TSE:PZA)
- Foot Locker (NYSE: FL)
Here is a final copy of our game plan. Use this list to find stocks for the next meeting. A week before the next meeting, please send your stocks to me (firstname.lastname@example.org) and I will upload it on this site for everyone to see and form their opinion on them. Here it is:
- P/E ratio – Good P/E for a value approach would be between 8 to 15. Avoid negative P/E.
- If a company provides dividends, it must be increasing and consistent for atleast 10 years.
- Return on Equity (ROE). Look for companies with 15% ROE or higher. Break down the ROE and understand what is driving it. To breakdown the ROE, look at ROA (Return on Asset), Profit Margin, and leverage ratio (Asset/Equity).
- Debt to Equity (D/E). Look for companies with less than 1 D/E. If not less than 1, compare with industry standard.
- Price to Book (P/B). Look for companies with less than 1.5.
- Forward Price Earnings. Look for companies that have a number similar to trailing P/E (between 8 to 15 is good).
- Look for companies with large MOAT. What gives barriers to entry and a competitive advantage for company. See how well their connected with their suppliers and see if their brand has any value.
- Profit margin or income must be above 10% for past 10 years.
- Figure out if the company has cash to back their operations. Take a look at cashflow statement and the following ratios: cash flow to equity, current ratio, free cash flow to equity.
- Compare cash per share with their earnings per share. It is favourable to see cash per share greater than earnings per share. This shows company can pay dividends and is not relying on debt.
- For growth companies take a look at earnings/share growth rate or PEG.
- Take a look at insider buying to see how much management has an interest in the company.
What to Avoid:
- Jim Cramer, CNBC, Promotional Emails.
- Avoid hyped stocks/industries.
- Avoid CEO’s forecast of the business.
Here are some of the things we have discussed today. Take a look. Familiarize yourself with the ratios and for the next meeting we will talk about which ratios or indicators we should follow:
- P/E ratio – Good P/E would be 15.
- How long it will take to get residual income by looking at stock price/dividend.
- Return on Equity (ROE). Look for companies with 15% ROE or higher.
- Debt to Equity (D/E). Look for companies with less than 1 D/E.
- Price to Book (P/B). Look for companies with less than 1.5.
- Forward Price Earnings. Look for companies less than 20.
- Look and compare cash flows of different companies. Look at price to cash flow or cashflow/share or current ratio. Look for companies with current ratio between 1.5 to 5.
- Look at the charts. Moving Average for 5 years. You can also look at SMA or EMA.
- Volume is important in a stock.
- Cash flow must be higher than inflation and on par or higher with market growth. Example: Look at competitors, see if their cash flow is better than the company’s cash flow statement.
- Look for companies with large MOAT. This gives barriers to entry and a competitive advnatage for company.
- Look at sales and compare COGS (cost of goods sold). Sales should be higher than 10%.
- Look at inventory turnover, to see if company is selling products and compare with other companies.
- Don’t jump into a stock when it is hyped.
- Don’t believe the internet, emails, media, CNBC, Cramer.
- Have a stop loss for your stocks.
- Follow intuition and don’t take opinions.
Yahoo / Finance – overseas markets and their impact on US, CAD; Futures
Briefing.com – pre-market snapshot, US market update, Earnings Calendar, Upgrades / Downgrades
Finviz.com – Market Heat Map
- Benjamin Graham – Intelligent Investor, Security Analysis
- Warren Buffett – Letters to Shareholders
- Peter Lynch – One up on Wall Street, Beating the Street, Learn to Earn
- Jim Rogers – Investment Biker, Adventure Capitalist, Hot Commodities
- Jack Schwager – Market Wizards, the New Market Wizards
- Joel Greenblatt – Magic Formula Investing
- Edwin Lefevre – Reminiscences of a Stock Operator
- William O’Neill – How to Make Money in Stocks
- Frost & Prechter – Elliott Wave Principle
- Nicolas Darvas – How I Made $2,000,000 in the Stock Market
- Napoleon Hill – Think and Grow Rich
- Seth Klarman – Margin of Safety
I highly recommend writing a business plan.
I am also attaching a gift for everyone who likes to read: Margin of Safety by Seth Klarman. Coveted book that is out of print and sells for $1,600 on Amazon (used!) However, it is NOT my favorite.
E-book: Margin of Safety
Does anyone have e-book version of Graham’s Security Analysis?
Many happy returns!
Here is the E-book for: Security Analysis Benjamin Graham
Websites I use:
Nasdaq.com. You can use this site to search stocks randomly.
Magazines/Newspapers to Subscribe to:
Books to Read:
The Intelligent Investor – Benjamin Graham
Trading Book – Anne Marie Baiynd
Some tools I use:
oscreener.com (HIGHLY RECOMMEND)- option pick screener that has been extremely helpful and efficient for my findings of naked puts so far with great IVs (premium amount is a function of IVs in general) ; above all, it’s free!
Anyone experienced with options, let me know.
Reuters – general info; usually quick check analysts buy/hold/sell opinions
marketwatch.com – same as above
stockchase.com (HIGHLY RECOMMEND) – used this the most pretty much everyday; it’s a filter/screener that captures stocks opinions and comments made by professionals on BNN channel; you can also categorize by “strong buy”, “buy”, to “strong sell”; if anyone is interested in knowing how I usually use the site for my findings, let me know. Easy to use, good for people who are busy during the day
platforms – Questrade platform, thinkorswim (data rich platform for my options trades and technical analysis of my long stock positions)
investing.com – quick buy/hold/sell check for all the technical indicators
What I am currently “experimenting”:
-option : straddles for JNUG at open/close, trade and hold daily to one week most
-stock : trying to figure out a way to capture gains in TNA (leveraged etf, 3x); returns I tested out if I use sma(20), expMA(5) crossover pts as entry/exit pts, weekly bars, at day’s average trade price, about 250% return in 2.5 years, but if I combine it with TZA, then it’s somewhere around 350%; but this is still an experiment; if anyone can help fine tune my approach we can hopefully make some good profits whether market’s up or down; to clarify, for the above, the idea is to buy tza when i exit tna, and switch it up when I sell tza, and so on, because they are exactly inversely related, one’s 3x leveraged bull, the other 3x leveraged bear. Feel free to add comments, positive and negative.
So that’s it for now. Thanks again Daniel! Let me know if you need help with organizing in the future. I would be happy to help out.
Not sure how many of us use Microsoft Excel, but I find google drive’s sharing/collaborative function very effective. We can perhaps take advantage of that in the future if we are sharing documents or anything related in the future with a google group.
Some content on this page was disabled on October 5, 2015 as a result of a DMCA takedown notice from Seth Klarman. You can learn more about the DMCA here: