What Did You Buy Today?

[fenders53]

(09-13-2019, 06:08 PM)stockguru Wrote: I would never buy MMM. They are no longer a growth company. And as long as tariffs are a threat, they will continue to suffer and hit new lows. I don’t need a graph to tell me that lol. Yes it’s cone off the lows but that won’t last. Just a rotation going on right now.

Thanks for the info. I will have to check them out.  

I sill say MCD hits $230 by years end.

And you could very be well be right Guru.  And it might be sub $150 next recession.  We can't know that of course.  What we CAN do is have the good sense to understand risk/reward, and keep our bets small when appropriate.   

LOL, I'll shut up as soon as you pull up a 20yr chart on INTC, CSCO and PFE and imagine an investment around 1999-2000 .  They were all can't lose stocks, pay any price.  That was the modern equivalent of AMZN, AAPL and JNJ safe.  You couldn't go wrong, right up until it didn't work anymore.

[fenders53]

(09-13-2019, 06:12 PM)stockguru Wrote: Here’s another example. A lot of you bought ABBV and GILD $10-15 higher then where there trading at now. I heard there so cheap? Trading at historic low PE. That didn’t work out too well lol. Just saying you never know. Sometimes it’s a crap shoot.

It's often a crap shoot more often than it isn't when you try to pick the bottom on a stock where the fundamentals have changed.  You'd have to be delusional to think ABBV is in the same situation as it was years ago when patents on a blockbuster drug were in the far distant future.  I'm still trying to nibble a position selling ABBV puts, but I know I am buying damaged goods for now, and the price isn't quite the smoking deal a historical price chart might suggest.  Thye have work to do, and I believe they have the resources to succeed.  And of course the stupid good dividend for now.

[Otter]

I really like this recent article by Chuck Carnevale, explaining his philosophy on value at time of purchase. He is far more eloquent and a more effective writer when it comes to conveying these concepts than I could ever hope to be:

https://seekingalpha.com/article/4290081...ket-timing

Short-term fluctuations in price don’t really concern me on a long-term time horizon. I will never buy any stock at the absolute bottom. That’s market timing. I can’t do that. All I can do is decide if value is fair or better at the time of purchase.

A stock that is 30% above its long-term average P/E, with a current price 7% higher than where it should be with a historically average P/E in more than two years carries too high of a value risk for how I analyze purchases. When that stock is forecast to grow earnings by only single-digit percentages over the next two years, that coupled with the current low yield indicates to me that the income stream I will be purchasing is not the best use of capital I can make. If MCD had a current yield like T, or was forecasting 25% annualized growth, my opinion would certainly change.

[Otter]

(09-13-2019, 06:04 PM)fenders53 Wrote: Agree MCD is way overvalued.  Rode it up for 40 quick points but pigs get slaughtered.  I'll wait for re-entry.  I only had to wait 15 years for a couple stocks to get me back to even.  It's going to be more like 20+ for INTC and CSCO.  Sure I sell some stocks too early, or never buy them.  I'll take that over avoiding port devastation.   It only has to happen to you once.   MMM is a good recent example of a stock that could take a decade to get back to even.  KMI is loved here.  Five years later and it is still under 50% of it's last peak, and we just had a couple decent oil price years that may or may not be ending for awhile.  Paying a huge premium for a mature company will get you burned.  It's not 1970 anymore for stocks like MCD and DIS.  You can't just pay any price.

fenders, you just need to build out that portfolio to 90+ stocks, then you don’t ever have to worry about portfolio devastation. 

[stockguru]

(09-13-2019, 07:22 PM)Otter Wrote: I really like this recent article by Chuck Carnevale, explaining his philosophy on value at time of purchase. He is far more eloquent and a more effective writer when it comes to conveying these concepts than I could ever hope to be:

https://seekingalpha.com/article/4290081...ket-timing

Short-term fluctuations in price don’t really concern me on a long-term time horizon. I will never buy any stock at the absolute bottom. That’s market timing. I can’t do that. All I can do is decide if value is fair or better at the time of purchase.

A stock that is 30% above its long-term average P/E, with a current price 7% higher than where it should be with a historically average P/E in more than two years carries too high of a value risk for how I analyze purchases. When that stock is forecast to grow earnings by only single-digit percentages over the next two years, that coupled with the current low yield indicates to me that the income stream I will be purchasing is not the best use of capital I can make. If MCD had a current yield like T, or was forecasting 25% annualized growth, my opinion would certainly change.

T and MCD don’t belong in the same sentence. How dare you lol. T has way too much debt and is at the sane price it was 5 years ago. It has 6% yield for a reason. Everyone has there own opinion. It’s what  makes a market. For every seller there’s a buyer. MCD has had a lot of funds buy in recently even above $220. So while some say it’s over valued, others see opportunity 

I wish I bought AMZN and NFLX 5 years ago when they were over valued. Heck they don’t even have a PE lol.

[Otter]

(09-13-2019, 07:50 PM)stockguru Wrote:

(09-13-2019, 07:22 PM)Otter Wrote: I really like this recent article by Chuck Carnevale, explaining his philosophy on value at time of purchase. He is far more eloquent and a more effective writer when it comes to conveying these concepts than I could ever hope to be:

https://seekingalpha.com/article/4290081...ket-timing

Short-term fluctuations in price don’t really concern me on a long-term time horizon. I will never buy any stock at the absolute bottom. That’s market timing. I can’t do that. All I can do is decide if value is fair or better at the time of purchase.

A stock that is 30% above its long-term average P/E, with a current price 7% higher than where it should be with a historically average P/E in more than two years carries too high of a value risk for how I analyze purchases. When that stock is forecast to grow earnings by only single-digit percentages over the next two years, that coupled with the current low yield indicates to me that the income stream I will be purchasing is not the best use of capital I can make. If MCD had a current yield like T, or was forecasting 25% annualized growth, my opinion would certainly change.

T and MCD don’t belong in the same sentence. How dare you lol. T has way too much debt and is at the sane price it was 5 years ago. It has 6% yield for a reason. Everyone has there own opinion. It’s what  makes a market. For every seller there’s a buyer. MCD has had a lot of funds buy in recently even above $220. So while some say it’s over valued, others see opportunity 

I wish I bought AMZN and NFLX 5 years ago when they were over valued. Heck they don’t even have a PE lol.

Haha. T may not be the best example, but people who bought recently in the 20s probably are pretty happy with their imaginary paper gains. The yield back then, though! Debt is always concerning, and credit rating is absolutely one of my purchase/value criteria (I prefer BBB+ or better)

I have a lot of overvalued holdings at the moment that I’m not adding to. LMT, TGT, and VFC immediately come to mind. I’ll definitely buy more if they ever get cheaper, but the bear market right now mostly appears to be in Industrials, agribiz, community banks, and materials. Stocks like ADM, CAT (avoided for a long time, started a position today), NUE, CTBI, CFR, and a couple others appear to be where the value is right now. Prices are better when the headlines are doom and gloom. If the world stops needing steel, mass-produced food/feedstock, industrial equipment, and banks that invest locally, we’ll all have bigger problems than where the S&P is at.

[stockguru]

The what if’s lol. Just like OXY, FDX, PM, BMO, WBA and SPG. Just to name a few I bought in recent weeks.

I own TGT but bought at $66.

[fenders53]

We can go round and round about this. I do learn many things from you youngin's lol. I don't mind being disagreed with, in fact I welcome it. My scar tissue remains and I do try to realize I hit a special set of circumstances during the tech bubble. . I thought I was somewhat diversified but the entire market was over-valued. The dotcom startups made the major tech stocks look fairly valued. It wasn't so. I was a kid then. I tuned the stock market out for a couple years, then slowly moved dead money into JNJ and XEL, and left my MSFT alone. Put now substantial new money into the SPX for quite a long time. That all turned out to be a good move. MSFT is the only stock where patience paid off, but it took way too long. How long before CSCO runs up another 60% and gets to 80. When will INTC hit 75? Those were the highs 20 years ago. Those are not exactly junk companies. That's my "valuation matters" lesson I won't ever forget, or stop sharing. Holding a stock 25 yrs to get back to even isn't good investing.

[stockguru]

Lol I don’t hold loser stocks that long lol. I won’t invest in INTC because that business is too up and down. Slower PC sales more so then not, AMD new chips also put a damper on them. We all have losers. I don’t have the patience to wait it out once a company disappoints me One too many times. Good example I had bought IBM around $190 a while back. The company changed and I didn’t like the CEO and her acquisitions. So I sold at $176 and it still hasn’t recovered.

[NilesMike]

Just remembered this thread. Maybe it offers some perspective.
http://dividendgrowthforum.com/showthrea...hlight=mcd

[fenders53]

(09-13-2019, 10:06 PM)stockguru Wrote: Lol I don’t hold loser stocks that long lol. I won’t invest in INTC because that business is too up and down.  Slower PC sales more so then not,  AMD new chips also put a damper on them. We all have losers. I don’t have the patience to wait it out once a company disappoints me One too many times. Good example I had bought IBM around $190 a while back. The company changed and I didn’t like  the CEO and her acquisitions. So I sold at $176 and it still hasn’t recovered.

This was around the time that when stock forums were new.  I remember reading and repeating the following... 

"Nobody has ever sold INTC and been happy they did a year later".  That was a very true statement at the time.  Same pretty much applied to CSCO and MSFT.  They were absolutely dominant companies.  They survived because they were.  BTW, I agree with you on IBM.  You have to be patient to succeed at this, but you have to listen to the little voice when it tells you to dig deeper because the growth story has fundamentally changed.

Back to our topic, I've survived two nasty corrections in my investing life.  MCD is regarded as a recession stock.  We'll see if that applies if it enters at a PE north of 25.  My little voice says it will get crushed like any other high flyer.  Sure, it will rise from the ashes.  It was in the 150's last year when I bought some.  Market sentiment is fickle.  MCD hasn't changed so much in under 12 months.

[crimsonghost747]

Sold Entertainment one.

They are being acquired, I've been waiting almost a month for a second, higher offer to emerge but it's been very quiet so might as well grab my money and deploy it elsewhere. It's just my luck that a new, significantly higher bid will come out tomorrow.

Not exactly sure what I'll put that money into, but I'll figure it out today/tomorrow.