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What Did You Buy Today?
(04-08-2020, 09:26 AM)fenders53 Wrote:
(04-08-2020, 08:58 AM)divmenow Wrote: So AAPL, DRI and TWTR all upgraded to buy this morning. Very interesting. I can’t remember the last time I saw an upgrade lol. Maybe we have bottomed. Hmmm

There were a few upgrades about the time we bottomed  the SPY and some companies were getting way out of hand on the downside.  Most of the analysts seem to have froze due to lack of updated data.  Some companies will be in their pre-earning report lock up periods soon, if they aren't already.  We really do need earning #s soon, for better or worse.

The earrings are going to suck.. Just looks at all these companies announcing Withdrawing 2020 Outlook and Long-Term Outlook. MCD was the latest today. Pretty grim if you asked me. But don't worry these stocks will all trade higher again based on no earnings or fundematials Big Grin


The Fed keeps buying up stocks to stay afloat. But that can only last for so long. At some point this will end. Pretty scary if you ask me going forward.
(04-08-2020, 09:59 AM)divmenow Wrote:
(04-08-2020, 09:26 AM)fenders53 Wrote:
(04-08-2020, 08:58 AM)divmenow Wrote: So AAPL, DRI and TWTR all upgraded to buy this morning. Very interesting. I can’t remember the last time I saw an upgrade lol. Maybe we have bottomed. Hmmm

There were a few upgrades about the time we bottomed  the SPY and some companies were getting way out of hand on the downside.  Most of the analysts seem to have froze due to lack of updated data.  Some companies will be in their pre-earning report lock up periods soon, if they aren't already.  We really do need earning #s soon, for better or worse.

The earrings are going to suck.. Just looks at all these companies announcing Withdrawing 2020 Outlook and Long-Term Outlook. MCD was the latest today. Pretty grim if you asked me. But don't worry these stocks will all trade higher again based on no earnings or fundematials Big Grin


The Fed keeps buying up stocks to stay afloat. But that can only last for so long. At some point this will end. Pretty scary if you ask me going forward.

The Fed has not bought a single equity share over the course of its existence. Section 14 of the Federal Reserve Act sets the scope of open market operations, and equities are not included within the scope of its purchasing authority. The Fed cannot legally buy any shares unless Congress changes the law. 

They are, however, accepting equities as collateral for purposes of issuing short term loans to Primary Dealers.
(04-08-2020, 09:59 AM)divmenow Wrote:
(04-08-2020, 09:26 AM)fenders53 Wrote:
(04-08-2020, 08:58 AM)divmenow Wrote: So AAPL, DRI and TWTR all upgraded to buy this morning. Very interesting. I can’t remember the last time I saw an upgrade lol. Maybe we have bottomed. Hmmm

There were a few upgrades about the time we bottomed  the SPY and some companies were getting way out of hand on the downside.  Most of the analysts seem to have froze due to lack of updated data.  Some companies will be in their pre-earning report lock up periods soon, if they aren't already.  We really do need earning #s soon, for better or worse.

The earrings are going to suck.. Just looks at all these companies announcing Withdrawing 2020 Outlook and Long-Term Outlook. MCD was the latest today. Pretty grim if you asked me. But don't worry these stocks will all trade higher again based on no earnings or fundematials Big Grin


The Fed keeps buying up stocks to stay afloat. But that can only last for so long. At some point this will end. Pretty scary if you ask me going forward.
I agree with all that.  I watched MCD rocket past my 160 sell price in amazement.  They stood out as truly getting way ahead of the fundamentals.  Most of my holdings are probably safe from earnings catastrophe because I am very defensive overall, but yeah it's going to be ugly.  I'm looking/hoping for one more solid dip to get adjusted for the next year or so.  If earnings don't do it we'll have to go from there.  The FED isn't buying stocks as it isn't legal yet, but they are surely accommodating the process.

I'll sold most of my MMM and CAT position. Not just a trim this time. I need to see earnings before I get back in deep. I'll buy gloom if it's priced appropriately.
MCD has traditionally had 70% of its sales from the drive through, they were well positioned for the crisis.
The Fed buys and sells debt, because debt is the underpinning of the modern monetary system.

As far as the Fed is concerned, debt is just a method of expanding the money supply and velocity of money through the economic system. Sovereign debt can be created and destroyed at will, depending upon inflation risk and employment statistics. It works fine unless there is a loss of confidence in the underlying monetary system.
(04-08-2020, 10:12 AM)NilesMike Wrote: MCD has traditionally had 70% of its sales from the drive through, they were well positioned for the crisis.
IMO they are about fully valued for all their sales today.  But they are MCD so the stock will be fine.  Their balance sheet isn't what it once was.  They are also a real estate company now with few company owned stores so they can't be valued quite the same vs historical.  I bought sub $130 shares so not being greedy.

EDIT: Just saw the MCD same store numbers release. Down only -22% is better than anyone could reasonably expect for March IMO.
(04-08-2020, 10:25 AM)fenders53 Wrote:
(04-08-2020, 10:12 AM)NilesMike Wrote: MCD has traditionally had 70% of its sales from the drive through, they were well positioned for the crisis.
IMO they are about fully valued for all their sales today.  But they are MCD so the stock will be fine.  Their balance sheet isn't what it once was.  They are also a real estate company now with few company owned stores so they can't be valued quite the same vs historical.  I bought sub $130 shares so not being greedy.

Here’s the thing. Sure MCD drive through will always be three strength. But chick fil a lines are huge and taking away a lot of business from MCD right now. And people are getting food from local small business to support them though this virus to keep them a float.  MCD also now has a limited menu and that’s going to hurt them not to mention they did away with the 24 hr breakfast and that was a bad move. So it’s not a great a story as you think it is. I bought some in $130 range as well and sold out of it all at $178. Not greedy as well lol
We are going to struggle with recent low price bias. I don't know about anybody else, but I didn't start a DGI port from scratch last month and buy all my positions at five year low prices. This is why we need some earning guidance. I was good with blindly buying quality brands that were suddenly 50% off. Now I look at a stock only 15% off it's ATH and think hmmmmm, I wonder if they will struggle for five quarters with much higher debt? That's not priced in anymore. That greatly affects how much I am going to pay. There will be more deals soon.
(04-08-2020, 10:57 AM)fenders53 Wrote: We are going to struggle with recent low price bias.  I don't know about anybody else, but I didn't start a DGI port from scratch last month and buy all my positions at five year low prices.  This is why we need some earning guidance.  I was good with blindly buying quality brands that were suddenly 50% off.  Now I look at a stock only 15% off it's ATH and think hmmmmm, I wonder if they will struggle for five quarters with much higher debt?   That's not priced in anymore.  That greatly affects how much I am going to pay.  There will be more deals soon.

Yes. I have been waiting for more clarity on the "E" side of the P/E equation. That clarity will also end up moving the P.

Edited to add - The "E" information also plays in to most of my other metrics for determining DGI value, like payout ratio, and how realistic Chowder Numbers based on past 5yrs results are likely to be.
Added to CARR (one of the two spinoffs when UTX & Raytheon merged to become RTX). I'm not interested in OTIS, although I'll hold those shares forever. CARR seems like it should be worth $30/share and it's trading at $14. Thoughts?
(04-08-2020, 10:59 AM)Otter Wrote:
(04-08-2020, 10:57 AM)fenders53 Wrote: We are going to struggle with recent low price bias.  I don't know about anybody else, but I didn't start a DGI port from scratch last month and buy all my positions at five year low prices.  This is why we need some earning guidance.  I was good with blindly buying quality brands that were suddenly 50% off.  Now I look at a stock only 15% off it's ATH and think hmmmmm, I wonder if they will struggle for five quarters with much higher debt?   That's not priced in anymore.  That greatly affects how much I am going to pay.  There will be more deals soon.

Yes. I have been waiting for more clarity on the "E" side of the P/E equation. That clarity will also end up moving the P.

Edited to add - The "E" information also plays in to most of my other metrics for determining DGI value, like payout ratio, and how realistic Chowder Numbers based on past 5yrs results are likely to be.

Agree totally. Luckily earnings season starts in a week or two.
(04-08-2020, 10:59 AM)Otter Wrote:
(04-08-2020, 10:57 AM)fenders53 Wrote: We are going to struggle with recent low price bias.  I don't know about anybody else, but I didn't start a DGI port from scratch last month and buy all my positions at five year low prices.  This is why we need some earning guidance.  I was good with blindly buying quality brands that were suddenly 50% off.  Now I look at a stock only 15% off it's ATH and think hmmmmm, I wonder if they will struggle for five quarters with much higher debt?   That's not priced in anymore.  That greatly affects how much I am going to pay.  There will be more deals soon.

Yes. I have been waiting for more clarity on the "E" side of the P/E equation. That clarity will also end up moving the P.

Edited to add - The "E" information also plays in to most of my other metrics for determining DGI value, like payout ratio, and how realistic Chowder Numbers based on past 5yrs results are likely to be.
This may not be the best plan but I do have a plan.  I nibbled quality all the way down and it was scary, and slowly trimming all the way back up.  I prayed for a bear market bounce but nobody predicted this outcome.  I suspected it would be months before we had any clarity on company financials and that came true.  I do want some earnings guidance, but waiting for the all clear signal will be WAY too late like always.  The market is running on nothing this week.  The last bounce was understandable.  There were stocks selling for pre-BK pricing (Wendy's at sub $8 when they are not shut down comes to mind).  This run is irrational.  The momentum algo machines have taken over lol.  The market will work it out when they get some facts.  There will be some downgrades when the numbers come to light.

Still holding a few SPY puts just in case.  I am four years from needing some of this port and another 30% haircut would not be welcomed.  Anything I share here should be read in that context.  When I was 30 I invested with my hair on fire.  Painful but it worked out.




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