What Did You Buy Today?

[fenders53]

(01-06-2021, 12:39 PM)crimsonghost747 Wrote: Bought some Pepsi. This is definitely not a rocket but I think I'll be happy with this one in a few years/decades.

So last week I got bored and sold all my PEP because I think bulk soda sales might stink this quarter with the partial shutdown.  Immediately sold puts to try to get back in and drop my basis about $5.  It's good to be lucky.  I should probably close the deal tomorrow.

[fenders53]

(01-06-2021, 02:08 PM)EricL Wrote:

(01-06-2021, 12:06 PM)kblake Wrote: What's the next group to fly?

Seems the pot, solar, and EV sectors are all hot.

It does seem that way.  Valuations were stupid six weeks or six months ago so buy quality that will actually make money when you can.  A few of the solar stocks prices are totally out of control vs reality earnings.  I am also going to watch what goes down due to the regime change.  This market is so desperate for something to buy and I bet it circles back around soon enough to but the "junk".

[EricL]

(01-06-2021, 05:16 PM)fenders53 Wrote:

(01-06-2021, 02:08 PM)EricL Wrote:

(01-06-2021, 12:06 PM)kblake Wrote: What's the next group to fly?

Seems the pot, solar, and EV sectors are all hot.

It does seem that way.  Valuations were stupid six weeks or six months ago so buy quality that will actually make money when you can.  A few of the solar stocks prices are totally out of control vs reality earnings.  I am also going to watch what goes down due to the regime change.  This market is so desperate for something to buy and I bet it circles back around soon enough to but the "junk".

I agree. Seems there is an insane amount of money sloshing around, moving from one hot thing to the next. When you have $700B stocks like TSLA moving the way it is, and thinking back to the powerful move in AAPL a few months back, it's just incredible.

Social media and ETF buying creates herds of buyers, moving things higher and higher. Moar stimulus that just passed, and more likely to come just keeps pushing things higher.

[Otter]

(01-06-2021, 05:22 PM)EricL Wrote:

(01-06-2021, 05:16 PM)fenders53 Wrote:

(01-06-2021, 02:08 PM)EricL Wrote:

(01-06-2021, 12:06 PM)kblake Wrote: What's the next group to fly?

Seems the pot, solar, and EV sectors are all hot.

It does seem that way.  Valuations were stupid six weeks or six months ago so buy quality that will actually make money when you can.  A few of the solar stocks prices are totally out of control vs reality earnings.  I am also going to watch what goes down due to the regime change.  This market is so desperate for something to buy and I bet it circles back around soon enough to but the "junk".

I agree. Seems there is an insane amount of money sloshing around, moving from one hot thing to the next. When you have $700B stocks like TSLA moving the way it is, and thinking back to the powerful move in AAPL a few months back, it's just incredible.

Social media and ETF buying creates herds of buyers, moving things higher and higher. Moar stimulus that just passed, and more likely to come just keeps pushing things higher.

Yes, this is classic asset inflation from an increase in the money supply. 

With the real economy in the state that it is in, you would not expect the S&P 500 to have posted 16+% gains in 2020. When you consider that the Fed balance sheet has posted a 100% gain in the same period, the market is actually pricing in economic reality, it's just that there are a lot more dollars in the system. 

If the Fed had done what it did during a period when the economy was healthy and growing, the S&P 500 should probably be over 6,500 by now.

[Otter]

The Fed does not buy securities directly, but when it injects trillions into the bond (including corporate and junk bond) markets, that allows investors who were upside-down on toxic paper to cash out without suffering the embarrassment of a loss on their risky investment, then put their money somewhere else. With interest rates at zero, that money goes into equities.

[vbin]

(01-06-2021, 05:50 PM)Otter Wrote: The Fed does not buy securities directly, but when it injects trillions into the bond (including corporate and junk bond) markets, that allows investors who were upside-down on toxic paper to cash out without suffering the embarrassment of a loss on their risky investment, then put their money somewhere else. With interest rates at zero, that money goes into equities.

And house prices. It's nuts in bay area. House prices are going though the roof despite companies moving out of cali.

[NilesMike]

Bought CRSP Bull Call spread135/140 16JUL21

Paid 2.45, max profit 2.55

Breakeven price 137.45 @ expiration

Anyone see a 28.00 drop by July?

[NilesMike]

Buying KO @ open. 3.25% yield has been very good time to add to KO. Previous 3.25% yield buy in prices- 16,19,32,36,40,43,45- now $50

I don't understand the drop now, we are closer to re-opening things than we have been. I think the drop is way overdone, when the economy re-opens, Coca-Cola will be there as it always has.

[DividendGarden]

(01-07-2021, 07:11 AM)NilesMike Wrote: I don't understand the drop now, we are closer to re-opening things than we have been. I think the drop is way overdone, when the economy re-opens, Coca-Cola will be there as it always has.

There were three analyst downgrades of KO over the last few days, which is what caused the stock to drop.  It's crazy that a few analysts can move a stock 10% in three days.

[DividendGarden]

(01-07-2021, 09:16 AM)DividendGarden Wrote:

(01-07-2021, 07:11 AM)NilesMike Wrote: I don't understand the drop now, we are closer to re-opening things than we have been. I think the drop is way overdone, when the economy re-opens, Coca-Cola will be there as it always has.

There were three analyst downgrades of KO over the last few days, which is what caused the stock to drop.  It's crazy that a few analysts can move a stock 10% in three days.

I stand corrected - there was a fourth downgrade this morning.  Of course, knowing what I know now, I wouldn't be surprised if their companies were short KO and needed to buy some shares.

[fenders53]

[quote pid='23284' dateline='1610029089']
[quote pid='23283' dateline='1610028994']


There were three analyst downgrades of KO over the last few days, which is what caused the stock to drop.  It's crazy that a few analysts can move a stock 10% in three days.
[/quote]

I stand corrected - there was a fourth downgrade this morning.  Of course, knowing what I know now, I wouldn't be surprised if their companies were short KO and needed to buy some shares.
[/quote]
I need to go read the analyst downgrades.  I suspect it related to their bulk fountain" sales.  That is around half their sales and it global.  Too many lockdowns worldwide for the next couple quarter to be good.  It ran just a little too high with a highly predictable Covid wave inbound this past fall.  I'll be accumulating on the way down.  $45 Coke is about as safe as a CD with an actual yield.  It's not going that low short of market calamity nobody predicts.

[EricL]

(01-07-2021, 09:18 AM)DividendGarden Wrote:

(01-07-2021, 09:16 AM)DividendGarden Wrote:

(01-07-2021, 07:11 AM)NilesMike Wrote: I don't understand the drop now, we are closer to re-opening things than we have been. I think the drop is way overdone, when the economy re-opens, Coca-Cola will be there as it always has.

There were three analyst downgrades of KO over the last few days, which is what caused the stock to drop.  It's crazy that a few analysts can move a stock 10% in three days.

I stand corrected - there was a fourth downgrade this morning.  Of course, knowing what I know now, I wouldn't be surprised if their companies were short KO and needed to buy some shares.

KO will make the same $1.90 per share in earnings that it made back in 2011. A time during which it's payout ratio has grown from 50% to 75% of earnings.

The only time it showed EPS growth was in 2018, when it got a windfall from the corporate tax cut.

Since 2011, revenues have steadily declined from $46B to $33.5B, while long-term debt has grown from $13.6B to $39.5B.

Share count isn't even declining anymore, because there isn't enough cash left over after dividends and capital spending to fund buybacks.

KO=IBM, it's just financial engineering at this point. Unless there is a major catalyst, I don't see where growth will come from.