The sensex and nifty are still in intermediate downtrend.The downtrend started on 13th August 2008 The levels to be crossed for a new int. uptrend are 14,673 for sensex and 4,399 for the Nifty.
Sensex closing on Friday(29.8.2008) was 14,564.53.
NSE Nifty closing on Friday was 4360.00
Longterm trend down.
the market's long-term trend will turn up if the sensex closes bavoe its last intermediate top of 15,580 made on 13th August 2008.
Sunday, August 31, 2008
Sunday, August 24, 2008
Stock prices - Intermediate Trends - India and Global
Market declined for second successive week. (14,401.49 - 22.8.2008)[8.8.2008: 15,167.82; 14.8.2008:14,724.18]
market is in intermediate downtrend. The downtrend started on 12 July 2008.
the levesls to be crossed for start of intermediate uptrend is 14,746 for sensex and 4,435 for Nifty.
Long term trend down.
Long term trend will turn up if sensex closes above its last intermediate top of 15,580, and nifty 4,650.
If the present intermediate downtrend reverses above sensex 12,514 odd for an uptred will increase.
Global:Dow will enter intermediate downtrend if it crosses 11,800.
Uptrend above 12,000.
Sensex is at the same level at it was a year ago.
Deepak Mohoni, ET, 25.8.2008
market is in intermediate downtrend. The downtrend started on 12 July 2008.
the levesls to be crossed for start of intermediate uptrend is 14,746 for sensex and 4,435 for Nifty.
Long term trend down.
Long term trend will turn up if sensex closes above its last intermediate top of 15,580, and nifty 4,650.
If the present intermediate downtrend reverses above sensex 12,514 odd for an uptred will increase.
Global:Dow will enter intermediate downtrend if it crosses 11,800.
Uptrend above 12,000.
Sensex is at the same level at it was a year ago.
Deepak Mohoni, ET, 25.8.2008
Monday, July 28, 2008
US stocks Second-Quarter Earnings Update, July 23 2008
Second-Quarter Earnings Update
As of July 23, 2008 about 38% of S&P 500 companies had reported second-quarter earnings — including most of the major Financials. Earnings thus far are down 28% from the second quarter of last year, due largely to a 97% decline from Financials.
http://crewcapitalthoughts.blogspot.com/2008/07/second-quarter-earnings-update.html
As of July 23, 2008 about 38% of S&P 500 companies had reported second-quarter earnings — including most of the major Financials. Earnings thus far are down 28% from the second quarter of last year, due largely to a 97% decline from Financials.
http://crewcapitalthoughts.blogspot.com/2008/07/second-quarter-earnings-update.html
Monday, July 21, 2008
20 DMA - 21 July 2008 Indian Stock Market
The 20 DMA (daily moving average) is often considered as the best short-term trend indicator.
After falling below that on May 22, the Nifty had made multiple attempts to take it out — once on June 18 and again on July 11. But the failure of all such attempts meant that before Friday, it had spent 41 hapless nights below its 20 DMA — the longest span in more than a decade. No wonder, it had lost a whopping 25% in this period.
Now, with the 20 DMA conquered, bulls have definitely taken the first step in redeeming themselves.
20 DMA was cross on Friday 18 July 2008
From
Derivatives Diary,
Investor Guide, Economic Times 21 July 2008
by Shakti Shankar Mahapatra
shakti.patra@timesgroup.com
After falling below that on May 22, the Nifty had made multiple attempts to take it out — once on June 18 and again on July 11. But the failure of all such attempts meant that before Friday, it had spent 41 hapless nights below its 20 DMA — the longest span in more than a decade. No wonder, it had lost a whopping 25% in this period.
Now, with the 20 DMA conquered, bulls have definitely taken the first step in redeeming themselves.
20 DMA was cross on Friday 18 July 2008
From
Derivatives Diary,
Investor Guide, Economic Times 21 July 2008
by Shakti Shankar Mahapatra
shakti.patra@timesgroup.com
Technical analysis - Indian Market - 21 July 2008
The indices have falling intermediate tops and bottoms, and therefore, are in major (i.e. long-term ) downtrends. This means we are still in a bear market.
The market’s long-term trend will turn up if the Sensex closes above its intermediate top of 17,736, the Nifty above 5,300, and the CNX Midcap above 7,192.
Global indices are also in major downtrends, but only a handful have managed to remain above their last intermediate bottoms. The Chinese and then the Indian indices were the first to breach their last intermediate bottoms, and the Dow followed shortly thereafter. The Dow will enter a bull market if it closes above its last intermediate top at 13,200 during its next intermediate uptrend.
The Sensex breached 13,050 on Tuesday to go back into an intermediate downtrend. The Nifty and CNX Midcap followed suit by falling below 3,896 and 5,072, respectively. The July 11 highs are the levels to be crossed for the market to get back into an intermediate uptrend. These are 14,066 for the Sensex, 4,216 for the Nifty, and 5,406 for the CNX Midcap. A decline below 12,514 for the Sensex will mean a continuing intermediate downtrend.
Global markets also started rallying in the second half of the week, but only the Nasdaq Composite has managed to get into an intermediate uptrend until now. However, the rallies look a little more persistent than they had been in recent times, and a global intermediate uptrend appears to be a definite possibility now. Most major international markets are still in intermediate downtrends. The Dow will enter an uptrend if it stabilises above 11,550.
From
Glimmer of hope in volatile markets
by Deepak Mohoni in Economic Times
http://economictimes.indiatimes.com/Investors_Guide/Glimmer_of_hope_in_volatile_markets/articleshow/3257095.cms
The market’s long-term trend will turn up if the Sensex closes above its intermediate top of 17,736, the Nifty above 5,300, and the CNX Midcap above 7,192.
Global indices are also in major downtrends, but only a handful have managed to remain above their last intermediate bottoms. The Chinese and then the Indian indices were the first to breach their last intermediate bottoms, and the Dow followed shortly thereafter. The Dow will enter a bull market if it closes above its last intermediate top at 13,200 during its next intermediate uptrend.
The Sensex breached 13,050 on Tuesday to go back into an intermediate downtrend. The Nifty and CNX Midcap followed suit by falling below 3,896 and 5,072, respectively. The July 11 highs are the levels to be crossed for the market to get back into an intermediate uptrend. These are 14,066 for the Sensex, 4,216 for the Nifty, and 5,406 for the CNX Midcap. A decline below 12,514 for the Sensex will mean a continuing intermediate downtrend.
Global markets also started rallying in the second half of the week, but only the Nasdaq Composite has managed to get into an intermediate uptrend until now. However, the rallies look a little more persistent than they had been in recent times, and a global intermediate uptrend appears to be a definite possibility now. Most major international markets are still in intermediate downtrends. The Dow will enter an uptrend if it stabilises above 11,550.
From
Glimmer of hope in volatile markets
by Deepak Mohoni in Economic Times
http://economictimes.indiatimes.com/Investors_Guide/Glimmer_of_hope_in_volatile_markets/articleshow/3257095.cms
Monday, June 30, 2008
Sensex - Nifty Quarterly Profit Growth Coming Down
Mint published 8 quarters' sales, operating profit and net profit of sensex and nifty on the first page dated 30 June 2008.
It shows that growth in profits is decreasing on year on year basis.
For the quarter ended March 08 net profit growth y-o-y on sensex is12.89% and on Nifty it is 9.31%.
What is going to be the y-o-y growth in first quarter of fy 09?
It shows that growth in profits is decreasing on year on year basis.
For the quarter ended March 08 net profit growth y-o-y on sensex is12.89% and on Nifty it is 9.31%.
What is going to be the y-o-y growth in first quarter of fy 09?
Thursday, June 26, 2008
Only 5.2% scrips trading below book value in India
29th Septemer 2005, Economic Times
According to the latest data ETIG analysis shows that only 5.2% of the BSE 500 stocks are quoting below book value.
In comparison 62% of the stocks were below book value at the start of the bull rally in April 2003.
Surprising at the peak of the last boom, in April 2000, 61% of the stock quoted below book value. Then the boom was only in IT scrips.
Now the boom is more broad based.
According to the latest data ETIG analysis shows that only 5.2% of the BSE 500 stocks are quoting below book value.
In comparison 62% of the stocks were below book value at the start of the bull rally in April 2003.
Surprising at the peak of the last boom, in April 2000, 61% of the stock quoted below book value. Then the boom was only in IT scrips.
Now the boom is more broad based.
Tuesday, June 17, 2008
Goldman lowers price targets for 14 banking companies
Goldman said it was lowering its price targets for 14 banking companies while cutting its 2008 earnings-per-share forecasts for 11, according to Reuters.
http://www.cfo.com/article.cfm/11569777
http://www.cfo.com/article.cfm/11569777
Wednesday, June 11, 2008
Buffett's Bet with Hedge Funds
Buffett ha wagered roughly $320,000 of his personal money that S&P 500 will outperform a collection of hedge funds. The bet covers a decade and includes the condition that all fees, costs and expenses are included in the calculations. The bet concludes at the end of 2017.
The bet between Buffett and money managers who own Protege Partners LLC is outlined on the long bets web site.
One of the Protege's co founders, Ted Seides accepted the bet.
http://www.longbets.org/362#terms
The bet between Buffett and money managers who own Protege Partners LLC is outlined on the long bets web site.
One of the Protege's co founders, Ted Seides accepted the bet.
http://www.longbets.org/362#terms
Thursday, May 29, 2008
World Growth Outlook 2001-2025
Panama Canal Authortiy
Global Insight report on world growth outlook.
The report was made in 2005
Download link for the report
http://www.pancanal.com/esp/plan/estudios/0303-exec.pdf
Worldwide Market Forecast
for
Commercial Air Transport
2006-2025
Download link for the report
http://www.jadc.or.jp/wmf06.pdf
Global Insight report on world growth outlook.
The report was made in 2005
Download link for the report
http://www.pancanal.com/esp/plan/estudios/0303-exec.pdf
Worldwide Market Forecast
for
Commercial Air Transport
2006-2025
Download link for the report
http://www.jadc.or.jp/wmf06.pdf
Tuesday, May 20, 2008
Merrill Lynch Introduces New Equity Research Rating System
NEW YORK, May 14, 2008 — Merrill Lynch Global Research announced today a new system of equity ratings, which is designed to provide clients with enhanced transparency into analysts' views, greater differentiation among the equity ratings within a sector, and closer alignment between rating distributions and historical stock performance. The new equity ratings structure, to launch June 2, 2008, is unique in that it provides clients with an absolute return system with a relative twist.
"The investment performance of our institutional and individual investors is always paramount," said Candace Browning, president of Merrill Lynch Global Research. "The basis of the new equity rating system is to reinforce our ongoing drive to encourage Merrill Lynch analysts to adopt the perspective and mindset of top-performing investors."
In the new system, "Buy" stocks are expected to have a total return of at least 10 percent and are the most attractive stocks in a coverage cluster*. "Neutral" stock prices are expected to remain flat or increase, but be less attractive than Buy-rated stocks. "Underperform" stocks are (a) expected to have either a negative total return; or (b) have a positive total return but be the least attractive stocks in a coverage cluster. Merrill Lynch Research defines "coverage cluster" as a group of stocks covered by a single analyst or two or more analysts sharing a common industry, sector, region or other classification(s).
The new system also introduces dispersion guidelines that limit the number of the stocks in each investment rating category: Buy-rated stocks may not exceed 70 percent, Neutral-rated stocks may not exceed 30 percent and Underperform stocks must be at least 20 percent of each coverage cluster.
A ratings table, which will be on all Merrill Lynch Equity Research reports, is provided below:
Investment Rating-- Total Return Expectation (within 12-month period of date of initial rating)--- Ratings Dispersion Guidelines for Coverage Cluster *
rating - Return expectation - % recommendations
Buy --- 10 percent---- 70 percent
Neutral--- 0 percent--- 30 percent
Underperform--- N/A ---- 20 percent
* A Coverage Cluster is comprised of stocks covered by a single analyst or two or more analysts sharing a common industry, sector, region or other classifications.
"The rationale behind the introduction of rating dispersion requirements is compelling. By introducing distribution guidelines, we can be certain that our analysts' distributions correlate more closely with historical return statistics," said Ms. Browning. "I am confident that the new Merrill Lynch equity rating system will enhance our ability to provide incremental alpha-generating investment returns to our clients."
Merrill Lynch is also requiring an investment thesis, providing the rationale behind the analyst's recommendation, and a price objective target for every stock under coverage to maximize the transparency and support the analytical and intellectual basis of analysts' convictions and recommendations. In addition, Merrill Lynch analysts will continue to provide clients with volatility risk ratings and dividend ratings.
"The investment performance of our institutional and individual investors is always paramount," said Candace Browning, president of Merrill Lynch Global Research. "The basis of the new equity rating system is to reinforce our ongoing drive to encourage Merrill Lynch analysts to adopt the perspective and mindset of top-performing investors."
In the new system, "Buy" stocks are expected to have a total return of at least 10 percent and are the most attractive stocks in a coverage cluster*. "Neutral" stock prices are expected to remain flat or increase, but be less attractive than Buy-rated stocks. "Underperform" stocks are (a) expected to have either a negative total return; or (b) have a positive total return but be the least attractive stocks in a coverage cluster. Merrill Lynch Research defines "coverage cluster" as a group of stocks covered by a single analyst or two or more analysts sharing a common industry, sector, region or other classification(s).
The new system also introduces dispersion guidelines that limit the number of the stocks in each investment rating category: Buy-rated stocks may not exceed 70 percent, Neutral-rated stocks may not exceed 30 percent and Underperform stocks must be at least 20 percent of each coverage cluster.
A ratings table, which will be on all Merrill Lynch Equity Research reports, is provided below:
Investment Rating-- Total Return Expectation (within 12-month period of date of initial rating)--- Ratings Dispersion Guidelines for Coverage Cluster *
rating - Return expectation - % recommendations
Buy --- 10 percent---- 70 percent
Neutral--- 0 percent--- 30 percent
Underperform--- N/A ---- 20 percent
* A Coverage Cluster is comprised of stocks covered by a single analyst or two or more analysts sharing a common industry, sector, region or other classifications.
"The rationale behind the introduction of rating dispersion requirements is compelling. By introducing distribution guidelines, we can be certain that our analysts' distributions correlate more closely with historical return statistics," said Ms. Browning. "I am confident that the new Merrill Lynch equity rating system will enhance our ability to provide incremental alpha-generating investment returns to our clients."
Merrill Lynch is also requiring an investment thesis, providing the rationale behind the analyst's recommendation, and a price objective target for every stock under coverage to maximize the transparency and support the analytical and intellectual basis of analysts' convictions and recommendations. In addition, Merrill Lynch analysts will continue to provide clients with volatility risk ratings and dividend ratings.
Thursday, May 15, 2008
Joseph Lewis - Purchase of Bear Stearns Shares and the Loss
Mint of 12 Septermber 2007 carried an article that mentioned that British financier, Joseph Lewis bought 7 percent of Bear Stearns at beaten down prices.
An interesting issue at the moment is -
What happened to his investment, as J P Morgan paid only 10 dollars per share?
See the related information and posts
March 16, 2008
UK tycoon Joe Lewis loses $800m on Wall Street
JOE LEWIS, the secretive British billionaire, has lost an estimated $800m in the collapse of the American investment bank Bear Stearns.
The 71-year-old currency trading tycoon, who runs his empire from the Bahamas, holds almost 10% of the bank's shares. Bear’s shares fell 40% on Friday to $27, after it secured a 28-day credit lifeline to stave off collapse.
Lewis began building a stake in Bear last September, when the shares were changing hands for more than $100.
The huge paper losses could force Lewis to sell out of some of his other positions, according to traders, in order to meet margin calls from his lending banks.
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3558485.ece
March 24, 2008
Joseph Lewis, a major Bear Stearns shareholder, has squeezed a higher offer out of JPMorgan Chase.
JPMorgan Chase (JPM, Fortune 500) agreed Monday to quintuple the value of its all-stock offer for Bear Stearns, to $10 a share. The revamped agreement, valued at $1.18 billion, comes just a week after JPMorgan agreed to buy the cash-strapped brokerage firm with backing from the Federal Reserve. The deal staved off a probable Bear Stearns bankruptcy that threatened to swamp the financial sector with a new wave of uncertainty.
Monday's revised deal seeks to placate Bear Stearns shareholders who were outraged that they initially stood to get only $2 apiece for shares that fetched as much as $159 each a year ago. A majority of Bear Stearns shareholders must approve the transaction - a fact that hasn't been lost on investors such as Lewis, the billionaire currency trader who is Bear's second-biggest shareholder. Lewis had called the deal "derisory" and, in a regulatory filing last week, vowed that he and other members of his group would "take whatever action that they deem necessary and appropriate to protect the value of their investment in the shares."
http://money.cnn.com/2008/03/24/news/companies/barr_bear_bidding.fortune/index.htm?postversion=2008032413
An interesting issue at the moment is -
What happened to his investment, as J P Morgan paid only 10 dollars per share?
See the related information and posts
March 16, 2008
UK tycoon Joe Lewis loses $800m on Wall Street
JOE LEWIS, the secretive British billionaire, has lost an estimated $800m in the collapse of the American investment bank Bear Stearns.
The 71-year-old currency trading tycoon, who runs his empire from the Bahamas, holds almost 10% of the bank's shares. Bear’s shares fell 40% on Friday to $27, after it secured a 28-day credit lifeline to stave off collapse.
Lewis began building a stake in Bear last September, when the shares were changing hands for more than $100.
The huge paper losses could force Lewis to sell out of some of his other positions, according to traders, in order to meet margin calls from his lending banks.
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article3558485.ece
March 24, 2008
Joseph Lewis, a major Bear Stearns shareholder, has squeezed a higher offer out of JPMorgan Chase.
JPMorgan Chase (JPM, Fortune 500) agreed Monday to quintuple the value of its all-stock offer for Bear Stearns, to $10 a share. The revamped agreement, valued at $1.18 billion, comes just a week after JPMorgan agreed to buy the cash-strapped brokerage firm with backing from the Federal Reserve. The deal staved off a probable Bear Stearns bankruptcy that threatened to swamp the financial sector with a new wave of uncertainty.
Monday's revised deal seeks to placate Bear Stearns shareholders who were outraged that they initially stood to get only $2 apiece for shares that fetched as much as $159 each a year ago. A majority of Bear Stearns shareholders must approve the transaction - a fact that hasn't been lost on investors such as Lewis, the billionaire currency trader who is Bear's second-biggest shareholder. Lewis had called the deal "derisory" and, in a regulatory filing last week, vowed that he and other members of his group would "take whatever action that they deem necessary and appropriate to protect the value of their investment in the shares."
http://money.cnn.com/2008/03/24/news/companies/barr_bear_bidding.fortune/index.htm?postversion=2008032413
Wednesday, April 30, 2008
Dividends on S & P 500 from 1988 to 2008
http://financeandinvestments.blogspot.com/2008/03/s-500-dividends-updated-through-2007.html
Thursday, April 24, 2008
Seven Gems March 2008
This analysis published in Business Standard - Smart Investor is good to note from the viewpoint of earnings estimates
Priya Kansara / Mumbai March 31, 2008
These seven companies should see their earnings double in the next three years, which in turn should positively reflect on their respective stock prices.
Although the current turmoil is more to do with global events and to some extent due to the fears pertaining to earnings slowdown, one can still pinpoint companies capable of delivering an earnings growth of 25-30 per cent annually for the next three years. In other words, their earnings should double over the same period.
A good investment would ideally be a combination of robust fundamentals, sound promoter/management, market leadership in the business (preferred), healthy growth prospects, reasonable valuations and minimum downside risk, all of which put together should help achieve above-market returns.
The Smart Investor brings to you a few of such stocks, which with the exception Reliance Petroleum (due to no past track record as it is yet to commence operations), largely meet the criteria.
The current market turmoil is only making things more attractive. Even if the market goes for a toss, their relatively high-quality characteristics should act as a cushion.
Aban Offshore
The record high crude oil prices, worldwide shortage of rigs and investments to spruce up domestic oil production will benefit Aban Offshore, which provides rigs and allied equipment to the oil and gas industry.
The company’s well-timed fleet expansion in a tight supply, high demand scenario and renewal of longer-duration contracts at higher day rates would boost earnings over the next few years.
Aban is set to add five assets (four new jack-ups and a recently acquired semi-submersible rig) between CY08 and CY09 to its existing fleet of 16 offshore assets (post the acquisition of Sinvest).
Further, the company has renewed its longer duration contracts at much higher day rates, which means higher growth in profits.
For example, its two contracts with ONGC for three years each – one commencing from March 2008 and another already commenced from December 2007 – have been renewed at $150,000 per day each as against $45,000 and $28,000-$56,000 a day respectively, reflecting a more than three-fold rise in value of contracts.
Another contract, for six years, with Oriental Oil, which commenced from October 2007, was renewed at $87,000 (as compared with $40,000). Analysts expect this kind of supply tightness to continue till CY10.
The company’s acquisition of Sinvest, gave it access to premium jack-up rigs and quicker supply of rigs, which otherwise would have taken about three years.
Thus, the expected strong operational cash-flows will help Aban bring down the huge debt on its books (high debt to equity ratio of 1.7 in FY07) and boost earnings.
Lastly, while the growth in earnings in FY09 is steep as compared with the EPS of Rs 40 for trailing 12 months, it comes on the back of a loss in FY07 (due to five-fold rise in interest costs).
Nonetheless, after adjusting for the low base effect, Aban’s expected growth in earnings is more than healthy and its future prospects continue to be good, all of which make it a good bet.
ABB
ABB, a leading player in the power equipment (transmission and distribution) and industrial automation technology businesses, reported strong growth for the year ended December 2007, wherein revenues shot up by 39 per cent to Rs 5,930 crore and order backlog was up 49 per cent at Rs 5,020 crore followed by a 100 basis points improvement in operating margins to 12.2 per cent.
Such robust growth is expected to continue and orders are expected to flow in for the next few years, given growth in the power sector (in India as well as globally) and investments in sectors such as minerals, energy, oil and gas in emerging markets, driving demand for its automation division.
The Indian power sector is expected to witness investments of Rs 6,16,300 crore during the Eleventh Plan period (ending 2012), out of which the transmission and distribution sector – the target market for ABB – is allotted Rs 1,74,300 crore.
After completing its $100 million capex and augmenting its manufacturing facilities, ABB has announced yet another investment of a similar amount, spread over the next 18 months. ABB’s parent expects the business from its Indian operations to double by 2010, which is an indication of robust growth for ABB going forward.
HDFC Bank
HDFC Bank, the second largest private bank in India, trades at a premium to other larger private and public sector banks due to its ability to sustain its superior financial track record, especially in areas such as net interest margins, return ratios, profit growth and asset quality, irrespective of the interest rate scenario.
Going forward, the bank is expected to continue its robust organic growth – 42 per cent, 40.5 per cent and 31 per cent in advances, net interest income and net profit respectively, reported in the past four years.
Its recent acquisition of the relatively smaller private bank, Centurion Bank of Punjab (CBoP), should help expand its geographical reach. Its branch network would jump by 52 per cent to 1,148 branches, ahead of its larger peer ICICI Bank, with greater concentration in northern and southern states.
HDFC Bank’s balance sheet size, total advances and total deposits will shoot up as well, by 37 per cent, 43 per cent and 43 per cent, respectively.
However, its CASA (current and savings bank account) ratio will decline from 58 per cent to 50 per cent, which will impact margins, while its overall asset quality is also expected to be impacted slightly.
However, these concerns are only short-term in nature and should be offset on account of the long-term benefits from better synergies, rationalisation of employee and branches as well lower expenditure on technology.
Also, CBoP’s dominant position in the retail (two-wheelers and cars) and SME (small and medium enterprise) segments, distribution of third-party products and substantial non-resident client base will strongly complement to that of HDFC Bank.
IDFC
Infrastructure Development Finance Company (IDFC) has been a preferred lender to infrastructure projects due to its long track record and age old association with the government in policy formulation.
However, due to pressure on margins in this wholesale financing business, IDFC has formed its strategy of stepping up its fee-based income by acquiring stakes in various businesses including brokerage firm SSKI, buyout of Standard Chartered Mutual Fund, and private equity along with debt finance and syndication opportunities.
Nevertheless, infrastructure financing would remain a key revenue stream for the next few years due to the astounding (around $500 billion) opportunity in infrastructure spending.
Moreover, with India’s economic growth still one of the highest in the world, even after the expectations of a mild slowdown, and favourable demographics (leaving more disposable income in the hands of people), the financial services industry is expected to experience buoyant times.
For example, the Indian asset management industry has grown over 40 per cent in the last four years and is expected to grow at a rapid clip in the future as well. All this suggests that IDFC is not only set to grow at more than healthy rates, but should also emerge as a formidable financial institution.
Reliance Petroleum
Apart from the promoter company, Reliance Industries (RIL), Reliance Petroleum (RPL) also offers a good investment opportunity as its 29 million metric tonne per annum (580,000 barrels per day) refinery, the world’s sixth-largest is likely to come on stream before the scheduled December 2008.
The commissioning of capacity is well timed, given that the outlook for gross refining margins (GRMs) is bullish till FY12.
Globally, refining margins are likely to remain buoyant between $5-$10 per barrel from 2008 to 2012, thanks to the huge demand-supply mismatch and the time lag of three to four years for new capacities to come on-stream.
Also, increasingly stringent environmental standards leading to demand for light and cleaner products, and thus, high prices are further strengthening the case for higher GRMs.
The company’s promoter, Reliance Industries’ gross refining margins improved by 380 basis points in nine months ended December 2007 to $14.9 a barrel, almost double of the benchmark Singapore complex margins of $7.7 a barrel. Since RPL will be able to process even complex crudes it will earn relatively high refining margins.
The key thing to look in this case is the movement of the rupee against the dollar, which is bullish, though it would be partly offset by low cost incurred by the company due to its plant location in a special economic zone, benefiting from incentives like zero duty on imports of plant and machinery and fiscal benefits like a tax holiday (no minimum alternative tax; 100 per cent for first five year followed by half that for another five years).
Titan Industries
Titan’s focus on branded products, and its strategy of capturing less penetrated market segments and catering to every income group will help it reap rich fruits.
The company is a market leader in the organised watch segment with a 40 per cent share with brands like Titan, Sonata and Fast Track. It braced up its branded jewellery business and today, its Tanishq brand enjoys a strong recall in the organised market.
Organised jewellery retailing business has a meagre share of 3-4 per cent, but with a growth of 25-30 per cent, it is expected to gain higher share, thus benefiting Titan. Further, it has rightly identified new markets with strong growth potential.
It has also entered the $450 million Indian eyewear market with its Fast Track brand and precision engineering equipment business catering to automobile, medical and aerospace industry (global size of $35 billion). It has also ventured into the Rs 2,500-3,000 crore Indian prescription eyewear business under the brand Titan Eye+.
All these indicate that Titan is set to report high revenue growth driven by its branded jewellery business and supported by new segments.
Although profitability will trail sales growth due to lower margins in the jewellery business, it is still expected to be substantial. Moreover, periodic introduction of brands and ability to identify new segments boosts confidence about the company’s prospects.
Voltas
Voltas, the engineering and air-conditioning major, is expected to gain immensely from the rising capital expenditure across sectors like retail, IT and entertainment, and higher infrastructure spending in India and other emerging markets such as West Asia.
Being the second largest player in the Indian organised heating, ventilation, and air conditioning (HVAC) market after Blue Star, the company is expected to reap benefits of immense opportunities in the air conditioning market, especially the non-residential segment, which is expected to almost triple to Rs 37,600 crore in the next five years.
Apart from HVAC, Voltas will also gain from the growth in the construction activities, which in turn throw up opportunities in the fledgling MEP (mechanical, electrical and plumbing) industry.
The company has established itself in its MEP business, which is growing at 40 per cent year-on-year, which had an order book of Rs 3,500 crore (international orders worth Rs 2,700 crore and Rs 800 crore worth of domestic orders) as on December 2007.
To its credit, the company has executed orders at nine out of the ten domestic airports, and is currently working on the upcoming international airport at Hyderabad.
The total investment of Rs 40,800 crore planned towards airports over the next five years reflects a huge market and hence, growth potential for players including Voltas and Blue Star.
Also, Voltas, which commands a 17 per cent share in the air-conditioner market, should benefit from increased consumer spending. All this put together indicate strong growth prospects for Voltas.
Earnings estimates table
http://docs.google.com/Doc?docid=dg3h8m78_10gkws8rcx&hl=en
Priya Kansara / Mumbai March 31, 2008
These seven companies should see their earnings double in the next three years, which in turn should positively reflect on their respective stock prices.
Although the current turmoil is more to do with global events and to some extent due to the fears pertaining to earnings slowdown, one can still pinpoint companies capable of delivering an earnings growth of 25-30 per cent annually for the next three years. In other words, their earnings should double over the same period.
A good investment would ideally be a combination of robust fundamentals, sound promoter/management, market leadership in the business (preferred), healthy growth prospects, reasonable valuations and minimum downside risk, all of which put together should help achieve above-market returns.
The Smart Investor brings to you a few of such stocks, which with the exception Reliance Petroleum (due to no past track record as it is yet to commence operations), largely meet the criteria.
The current market turmoil is only making things more attractive. Even if the market goes for a toss, their relatively high-quality characteristics should act as a cushion.
Aban Offshore
The record high crude oil prices, worldwide shortage of rigs and investments to spruce up domestic oil production will benefit Aban Offshore, which provides rigs and allied equipment to the oil and gas industry.
The company’s well-timed fleet expansion in a tight supply, high demand scenario and renewal of longer-duration contracts at higher day rates would boost earnings over the next few years.
Aban is set to add five assets (four new jack-ups and a recently acquired semi-submersible rig) between CY08 and CY09 to its existing fleet of 16 offshore assets (post the acquisition of Sinvest).
Further, the company has renewed its longer duration contracts at much higher day rates, which means higher growth in profits.
For example, its two contracts with ONGC for three years each – one commencing from March 2008 and another already commenced from December 2007 – have been renewed at $150,000 per day each as against $45,000 and $28,000-$56,000 a day respectively, reflecting a more than three-fold rise in value of contracts.
Another contract, for six years, with Oriental Oil, which commenced from October 2007, was renewed at $87,000 (as compared with $40,000). Analysts expect this kind of supply tightness to continue till CY10.
The company’s acquisition of Sinvest, gave it access to premium jack-up rigs and quicker supply of rigs, which otherwise would have taken about three years.
Thus, the expected strong operational cash-flows will help Aban bring down the huge debt on its books (high debt to equity ratio of 1.7 in FY07) and boost earnings.
Lastly, while the growth in earnings in FY09 is steep as compared with the EPS of Rs 40 for trailing 12 months, it comes on the back of a loss in FY07 (due to five-fold rise in interest costs).
Nonetheless, after adjusting for the low base effect, Aban’s expected growth in earnings is more than healthy and its future prospects continue to be good, all of which make it a good bet.
ABB
ABB, a leading player in the power equipment (transmission and distribution) and industrial automation technology businesses, reported strong growth for the year ended December 2007, wherein revenues shot up by 39 per cent to Rs 5,930 crore and order backlog was up 49 per cent at Rs 5,020 crore followed by a 100 basis points improvement in operating margins to 12.2 per cent.
Such robust growth is expected to continue and orders are expected to flow in for the next few years, given growth in the power sector (in India as well as globally) and investments in sectors such as minerals, energy, oil and gas in emerging markets, driving demand for its automation division.
The Indian power sector is expected to witness investments of Rs 6,16,300 crore during the Eleventh Plan period (ending 2012), out of which the transmission and distribution sector – the target market for ABB – is allotted Rs 1,74,300 crore.
After completing its $100 million capex and augmenting its manufacturing facilities, ABB has announced yet another investment of a similar amount, spread over the next 18 months. ABB’s parent expects the business from its Indian operations to double by 2010, which is an indication of robust growth for ABB going forward.
HDFC Bank
HDFC Bank, the second largest private bank in India, trades at a premium to other larger private and public sector banks due to its ability to sustain its superior financial track record, especially in areas such as net interest margins, return ratios, profit growth and asset quality, irrespective of the interest rate scenario.
Going forward, the bank is expected to continue its robust organic growth – 42 per cent, 40.5 per cent and 31 per cent in advances, net interest income and net profit respectively, reported in the past four years.
Its recent acquisition of the relatively smaller private bank, Centurion Bank of Punjab (CBoP), should help expand its geographical reach. Its branch network would jump by 52 per cent to 1,148 branches, ahead of its larger peer ICICI Bank, with greater concentration in northern and southern states.
HDFC Bank’s balance sheet size, total advances and total deposits will shoot up as well, by 37 per cent, 43 per cent and 43 per cent, respectively.
However, its CASA (current and savings bank account) ratio will decline from 58 per cent to 50 per cent, which will impact margins, while its overall asset quality is also expected to be impacted slightly.
However, these concerns are only short-term in nature and should be offset on account of the long-term benefits from better synergies, rationalisation of employee and branches as well lower expenditure on technology.
Also, CBoP’s dominant position in the retail (two-wheelers and cars) and SME (small and medium enterprise) segments, distribution of third-party products and substantial non-resident client base will strongly complement to that of HDFC Bank.
IDFC
Infrastructure Development Finance Company (IDFC) has been a preferred lender to infrastructure projects due to its long track record and age old association with the government in policy formulation.
However, due to pressure on margins in this wholesale financing business, IDFC has formed its strategy of stepping up its fee-based income by acquiring stakes in various businesses including brokerage firm SSKI, buyout of Standard Chartered Mutual Fund, and private equity along with debt finance and syndication opportunities.
Nevertheless, infrastructure financing would remain a key revenue stream for the next few years due to the astounding (around $500 billion) opportunity in infrastructure spending.
Moreover, with India’s economic growth still one of the highest in the world, even after the expectations of a mild slowdown, and favourable demographics (leaving more disposable income in the hands of people), the financial services industry is expected to experience buoyant times.
For example, the Indian asset management industry has grown over 40 per cent in the last four years and is expected to grow at a rapid clip in the future as well. All this suggests that IDFC is not only set to grow at more than healthy rates, but should also emerge as a formidable financial institution.
Reliance Petroleum
Apart from the promoter company, Reliance Industries (RIL), Reliance Petroleum (RPL) also offers a good investment opportunity as its 29 million metric tonne per annum (580,000 barrels per day) refinery, the world’s sixth-largest is likely to come on stream before the scheduled December 2008.
The commissioning of capacity is well timed, given that the outlook for gross refining margins (GRMs) is bullish till FY12.
Globally, refining margins are likely to remain buoyant between $5-$10 per barrel from 2008 to 2012, thanks to the huge demand-supply mismatch and the time lag of three to four years for new capacities to come on-stream.
Also, increasingly stringent environmental standards leading to demand for light and cleaner products, and thus, high prices are further strengthening the case for higher GRMs.
The company’s promoter, Reliance Industries’ gross refining margins improved by 380 basis points in nine months ended December 2007 to $14.9 a barrel, almost double of the benchmark Singapore complex margins of $7.7 a barrel. Since RPL will be able to process even complex crudes it will earn relatively high refining margins.
The key thing to look in this case is the movement of the rupee against the dollar, which is bullish, though it would be partly offset by low cost incurred by the company due to its plant location in a special economic zone, benefiting from incentives like zero duty on imports of plant and machinery and fiscal benefits like a tax holiday (no minimum alternative tax; 100 per cent for first five year followed by half that for another five years).
Titan Industries
Titan’s focus on branded products, and its strategy of capturing less penetrated market segments and catering to every income group will help it reap rich fruits.
The company is a market leader in the organised watch segment with a 40 per cent share with brands like Titan, Sonata and Fast Track. It braced up its branded jewellery business and today, its Tanishq brand enjoys a strong recall in the organised market.
Organised jewellery retailing business has a meagre share of 3-4 per cent, but with a growth of 25-30 per cent, it is expected to gain higher share, thus benefiting Titan. Further, it has rightly identified new markets with strong growth potential.
It has also entered the $450 million Indian eyewear market with its Fast Track brand and precision engineering equipment business catering to automobile, medical and aerospace industry (global size of $35 billion). It has also ventured into the Rs 2,500-3,000 crore Indian prescription eyewear business under the brand Titan Eye+.
All these indicate that Titan is set to report high revenue growth driven by its branded jewellery business and supported by new segments.
Although profitability will trail sales growth due to lower margins in the jewellery business, it is still expected to be substantial. Moreover, periodic introduction of brands and ability to identify new segments boosts confidence about the company’s prospects.
Voltas
Voltas, the engineering and air-conditioning major, is expected to gain immensely from the rising capital expenditure across sectors like retail, IT and entertainment, and higher infrastructure spending in India and other emerging markets such as West Asia.
Being the second largest player in the Indian organised heating, ventilation, and air conditioning (HVAC) market after Blue Star, the company is expected to reap benefits of immense opportunities in the air conditioning market, especially the non-residential segment, which is expected to almost triple to Rs 37,600 crore in the next five years.
Apart from HVAC, Voltas will also gain from the growth in the construction activities, which in turn throw up opportunities in the fledgling MEP (mechanical, electrical and plumbing) industry.
The company has established itself in its MEP business, which is growing at 40 per cent year-on-year, which had an order book of Rs 3,500 crore (international orders worth Rs 2,700 crore and Rs 800 crore worth of domestic orders) as on December 2007.
To its credit, the company has executed orders at nine out of the ten domestic airports, and is currently working on the upcoming international airport at Hyderabad.
The total investment of Rs 40,800 crore planned towards airports over the next five years reflects a huge market and hence, growth potential for players including Voltas and Blue Star.
Also, Voltas, which commands a 17 per cent share in the air-conditioner market, should benefit from increased consumer spending. All this put together indicate strong growth prospects for Voltas.
Earnings estimates table
http://docs.google.com/Doc?docid=dg3h8m78_10gkws8rcx&hl=en
Saturday, March 22, 2008
Zacks PEG Ratio Strategy Highlights
March 20, 2008
Zacks PEG Ratio Strategy Highlights: Gafisa S.A., Ensco International, Oil States International, and Eagle Test Systems
CHICAGO--(BUSINESS WIRE)
If you like to use a company’s P/E ratio to determine its value, then you’ll love using the PEG Ratio Profit Track. The PEG Ratio can calculate if a stock is undervalued relative to its expected future growth. Find out which companies offer the greatest value regardless of growth rate to enjoy stellar returns. Four stocks meeting this screen’s exclusive criteria are: Gafisa S.A. (NYSE: GFA), Ensco International Inc. (NYSE: ESV), Oil States International Inc. (NYSE: OIS), Eagle Test Systems Inc. (NASDAQ: EGLT). View the entire list of stocks for the PEG Ratio Profit Track at http://at.zacks.com/?id=1837
Here are details about four companies currently identified by the PEG Ratio Profit Track:
Gafisa S.A. (NYSE: GFA) recently reported spectacular fourth-quarter and year-end financials, with full-year adjusted net income increasing by 77%. The project launches for the company increased by an incredible 122%, to R$2.2 billion from R$1 billion. GFA currently enjoys an average broker recommendation of 2 and an extremely low PEG ratio of .26, which place it on the PEG Ratio profit track. The Zacks #2 Rank company also announced that a dividend in the amount of R$0.21 will be payable on Apr 29.
Ensco International Inc. (NYSE: ESV) is a premier global offshore oil and gas drilling contractor, with a Zacks #2 Rank and PEG ratio of .41, making this undervalued stock a great pick for this screen. ESV delivered a strong fourth-quarter with year-over-year revenue jumping to $529.2 million from $470.6. The full-year net profits also increased to $992 million from $769.7 million. ESV sports an average broker rating of 2.11 and a 12-month trailing PE of 9.55.
Oil States International Inc. (NYSE: OIS) places on the PEG Ratio profit track with an average broker recommendation of 2 and a low PEG ratio of .40. OIS reported better-than-expected earnings in the fourth quarter, along with revenue that improved to $581 million, compared to $540 million. Its first-quarter EPS guidance of between $1.10 and $1.20 is in-line with analysts’ expectations. In February, the Zacks #1 Rank announced that its subsidiary, Oil States Industries Inc., purchased a facility on 22 acres along the Houston ship channel. OIS is a diversified solutions provider for the oil and gas industry.
Eagle Test Systems Inc. (NASDAQ: EGLT) is an Automated Test Equipment (ATE) company that provides tools for the world’s leading semiconductor companies. EGLT qualifies for this profit track with a per share price of $9.55 and an average broker recommendation of. The company reported strong first-quarter results, with revenue increasing to $31 million from $24 million. The Zacks #1 Rank company also sports an astoundingly low PEG ratio of .24 and a 12-month trailing PE of 18.08. EGLT expects its net revenue for the second quarter to be between $30 million and $34 million, which is higher than what analysts had expected.
Discover all the current stocks currently on the PEG Ratio Profit Track at: http://at.zacks.com/?id=1868
About Profit Tracks
What is a "Profit Track"? Each Profit Track is a successful stock picking strategy with proven results through the Bear Market of 2001-2002 and the Bull run started in 2003. On Zacks.com we have created these nine unique screens to offer investors great strategies to potentially outperform the market in the years ahead. In 2006, the Low Price Stocks strategy was the top performing Profit Track with a return of +56.5% followed by the Discounted Fundamental screen with a +34% return. To see all nine strategies along with philosophy, past performance and current stocks, go to http://at.zacks.com/?id=1838.
All the Profit Track strategies were created and backtested using the Research Wizard software from Zacks Investment Research. If you like this screening strategy, but want to narrow down the list of stocks and even improve the performance, then you should start a free trial to this powerful stock picking tool. Learn more about the Research Wizard free trial offer and our new special report “Top 10 Stock Screening Strategies” at http://at.zacks.com/?id=2156
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=1841
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks PEG Ratio Strategy Highlights: Gafisa S.A., Ensco International, Oil States International, and Eagle Test Systems
CHICAGO--(BUSINESS WIRE)
If you like to use a company’s P/E ratio to determine its value, then you’ll love using the PEG Ratio Profit Track. The PEG Ratio can calculate if a stock is undervalued relative to its expected future growth. Find out which companies offer the greatest value regardless of growth rate to enjoy stellar returns. Four stocks meeting this screen’s exclusive criteria are: Gafisa S.A. (NYSE: GFA), Ensco International Inc. (NYSE: ESV), Oil States International Inc. (NYSE: OIS), Eagle Test Systems Inc. (NASDAQ: EGLT). View the entire list of stocks for the PEG Ratio Profit Track at http://at.zacks.com/?id=1837
Here are details about four companies currently identified by the PEG Ratio Profit Track:
Gafisa S.A. (NYSE: GFA) recently reported spectacular fourth-quarter and year-end financials, with full-year adjusted net income increasing by 77%. The project launches for the company increased by an incredible 122%, to R$2.2 billion from R$1 billion. GFA currently enjoys an average broker recommendation of 2 and an extremely low PEG ratio of .26, which place it on the PEG Ratio profit track. The Zacks #2 Rank company also announced that a dividend in the amount of R$0.21 will be payable on Apr 29.
Ensco International Inc. (NYSE: ESV) is a premier global offshore oil and gas drilling contractor, with a Zacks #2 Rank and PEG ratio of .41, making this undervalued stock a great pick for this screen. ESV delivered a strong fourth-quarter with year-over-year revenue jumping to $529.2 million from $470.6. The full-year net profits also increased to $992 million from $769.7 million. ESV sports an average broker rating of 2.11 and a 12-month trailing PE of 9.55.
Oil States International Inc. (NYSE: OIS) places on the PEG Ratio profit track with an average broker recommendation of 2 and a low PEG ratio of .40. OIS reported better-than-expected earnings in the fourth quarter, along with revenue that improved to $581 million, compared to $540 million. Its first-quarter EPS guidance of between $1.10 and $1.20 is in-line with analysts’ expectations. In February, the Zacks #1 Rank announced that its subsidiary, Oil States Industries Inc., purchased a facility on 22 acres along the Houston ship channel. OIS is a diversified solutions provider for the oil and gas industry.
Eagle Test Systems Inc. (NASDAQ: EGLT) is an Automated Test Equipment (ATE) company that provides tools for the world’s leading semiconductor companies. EGLT qualifies for this profit track with a per share price of $9.55 and an average broker recommendation of. The company reported strong first-quarter results, with revenue increasing to $31 million from $24 million. The Zacks #1 Rank company also sports an astoundingly low PEG ratio of .24 and a 12-month trailing PE of 18.08. EGLT expects its net revenue for the second quarter to be between $30 million and $34 million, which is higher than what analysts had expected.
Discover all the current stocks currently on the PEG Ratio Profit Track at: http://at.zacks.com/?id=1868
About Profit Tracks
What is a "Profit Track"? Each Profit Track is a successful stock picking strategy with proven results through the Bear Market of 2001-2002 and the Bull run started in 2003. On Zacks.com we have created these nine unique screens to offer investors great strategies to potentially outperform the market in the years ahead. In 2006, the Low Price Stocks strategy was the top performing Profit Track with a return of +56.5% followed by the Discounted Fundamental screen with a +34% return. To see all nine strategies along with philosophy, past performance and current stocks, go to http://at.zacks.com/?id=1838.
All the Profit Track strategies were created and backtested using the Research Wizard software from Zacks Investment Research. If you like this screening strategy, but want to narrow down the list of stocks and even improve the performance, then you should start a free trial to this powerful stock picking tool. Learn more about the Research Wizard free trial offer and our new special report “Top 10 Stock Screening Strategies” at http://at.zacks.com/?id=2156
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=1841
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Friday, March 21, 2008
Financial Analyst Sees Dow Jones Industrial Average Fall to 2002 Levels
This news release was distributed by the PR Web Newswire on behalf of the organization below.
TodaysFinancialNews.com provides investors with in-depth video interviews with the world's most popular financial analysts and stock experts.
17 March 2008
Adam Lass, chief chartist of WaveStrength Options Weekly, believes that the fall-out of the current banking crisis is so severe that the Dow Jones Industrial Average could plunge to levels no seen in over five years: "We're already roughly back to 2006. We could easily see this get back to 2002 levels before the dust settles. The possibility of the Dow at 8,000 is certainly not out of the question."
Baltimore, Md. (PRWEB) March 17, 2008 -- Financial editor Adam Lass, chief chartist of Wavestrength Options Weekly, sees the potential for the Dow Jones Industrial Index to fall back to levels not seen since 2002.
In an exclusive TFN web video interview with TFN Smart Trading Action Alert's research director Laura Cadden, Mr. Lass said: "There's a big difference between this dip and the last dip. I'm anticipating the Dow dropping. We're already roughly back to 2006. We could easily see this get back to 2002 levels before the dust settles. The possibility of Dow at 8,000 is certainly not out of the question."
In his analysis of the current market situation, Lass considers the U.S. banking sector most exposed to further devaluation. Asked about the global effects of this development, he said: "Globally speaking, there are banks out there that never touched subprime. Robust banks in robust economies that have none of this red ink, and they're all being punished the same way, and that means that there's actually buys in banking out there."
Adam Lass gained international notoriety for predicting the stock market crash of September 2001 a few days before 9/11. His WaveStrength Options Weekly specializes in international options strategies.
TodaysFinancialNews.com provides investors with in-depth video interviews with the world's most popular financial analysts and stock experts.
17 March 2008
Adam Lass, chief chartist of WaveStrength Options Weekly, believes that the fall-out of the current banking crisis is so severe that the Dow Jones Industrial Average could plunge to levels no seen in over five years: "We're already roughly back to 2006. We could easily see this get back to 2002 levels before the dust settles. The possibility of the Dow at 8,000 is certainly not out of the question."
Baltimore, Md. (PRWEB) March 17, 2008 -- Financial editor Adam Lass, chief chartist of Wavestrength Options Weekly, sees the potential for the Dow Jones Industrial Index to fall back to levels not seen since 2002.
In an exclusive TFN web video interview with TFN Smart Trading Action Alert's research director Laura Cadden, Mr. Lass said: "There's a big difference between this dip and the last dip. I'm anticipating the Dow dropping. We're already roughly back to 2006. We could easily see this get back to 2002 levels before the dust settles. The possibility of Dow at 8,000 is certainly not out of the question."
In his analysis of the current market situation, Lass considers the U.S. banking sector most exposed to further devaluation. Asked about the global effects of this development, he said: "Globally speaking, there are banks out there that never touched subprime. Robust banks in robust economies that have none of this red ink, and they're all being punished the same way, and that means that there's actually buys in banking out there."
Adam Lass gained international notoriety for predicting the stock market crash of September 2001 a few days before 9/11. His WaveStrength Options Weekly specializes in international options strategies.
Newswatch India
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COPYRIGHT NOTICE: Unless a copyright is indicated, information on the Website is in the public domain and may be reproduced, published or otherwise used without permission from Newswatch India. We request only that the Newswatch India Website be cited as the source of the information and that any photo credits or bylines be similarly credited to the photographer or author or Newswatch India, as appropriate. If a copyright is indicated on a photo, graphic, or any other material, permission to copy these materials must be obtained from the original source. This copyright notice does not pertain to information at websites other than the Website.
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