2011 Prognostications

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2010 Stock Pick Recap

How did the 2010 picks do?
Stock picks did slightly worse than the broader market due to too much exposure with For Profit higher education. Others faired pretty well.

  • APOL (Apollo Group/University of Phoenix), DV (DeVry Inc.), and ESI (ITT Educational services) to represent the online education segment. All of these tanked because For Profit higher education companies will face increased scrutiny from the Obama administration; on 10/12/2010, the Apollo group warned that their profits would be at risk and the whole category sank. The Fed now manages student loans and the Administration is concerned that For Profit colleges have not been as successful in graduation rates. Additionally, there is the assertion that students who have been attending these institutions have had a higher rate of loan defaults--and have not been able to repay their federally-backed loans. Wait for APOL to announce Q4 earnings and Q1 outlook before reinvesting.
  • CMSCA (Comcast). Up 30%!
  • ETFC (Etrade), YHOO (Yahoo!), ADM (Arthur-Daniels Midland): Moving sideways.
  • CHL (China Mobile). +7%
  • AAPL (Apple): Unstoppable? 52% YOY!
  • RSH (RadioShack): The "lance effect" has dissipated with his poor performance at the Tour de France and his upcoming retirement. It is doubtful that they will continue to sponsor the team. RadioShack will fade into oblivion.
  • IRBT (iRobot): Up 41%
  • HGR (Hanger): Added this late. Makers of prosthetics, made famous for creating an artificial fin for a dolphin named "Winter". Up 53%
2010                    
Picks Ticker 12/31/2009 12/31/2010 2010%   Indices Ticker 12/31/2009 12/31/2010 2010%
Apollo Group  APOL 60.58 39.49 -35%   NYSE ^NYA 7,184.96 7,964.02 11%
DeVry Inc DV 56.73 47.98 -15%   DJIA ^DJI 10,428.05 11,577.51 11%
ITT Educat Svcs ESI 95.96 63.69 -34%   S&P 500 ^GSPC 1,126.42 1,257.64 12%
Comcast CMCSA 16.86 21.97 30%   Nasdaq ^IXIC 2,269.15 2,652.87 17%
Etrade ETFC 17.60 16.00 -9%     Total 21,008.58 23,452.04 11.6%
China Mobile CHL 46.43 49.62 7%            
Apple AAPL 211.64 322.56 52%            
Yahoo! YHOO 16.78 16.63 -1%            
ADM ADM 31.31 30.08 -4%            
Radio Shack RSH 19.50 18.49 -5%            
Irobot IRBT 17.60 24.88 41%            
Hanger HGR 13.83 21.19 53%            
Total 604.82  $    672.58 11.2%            

 

Here's the historical performance of the "prognostication picks".

2009                    
Picks Ticker 1/2/2009 12/31/2009 2009%   Indices Ticker 1/2/2009 12/31/2009 2009%
Campbell Soup CPB 30.43 33.8 11.1%   NYSE ^NYA 5,915.73 7,184.96 21.46%
Walmart WMT 57.18 53.45 -6.5%   DJIA ^DJI 9,034.69 10,428.05 15.42%
Phillip Morris PM 44.12 48.19 9.2%   S&P 500 ^GSPC 931.80 1,126.42 20.89%
Altria Group MO 15.2 19.63 29.1%   Nasdaq ^IXIC 1,632.21 2,269.15 39.02%
Procter & Gamble PG 62.8 60.63 -3.5%     Total 17,514.43 21,008.58 19.95%
Gap, Inc GPS 14.07 20.95 48.9%            
Tootsie Roll TR 25.77 27.38 6.2%            
Winnebago WGO 6.32 12.2 93.0%            
Yahoo YHOO 12.85 16.78 30.6%            
Google GOOG 321.32 619.98 92.9%            
S&P index SPY 92.96 111.44 19.9%            
Chipolte Mex Grill CMG 64.14 88.16 37.4%            
McDonalds MCD 63.75 62.44 -2.1%            
Nintendo NTDOY.PK 48 29.82 -37.9%            
Hasbro HAS 29.6 32.06 8.3%            
Total 888.51 1236.91 39.21%            
    Avg return 24.42%            
2008                    
Picks Ticker 1/2/2008 12/31/2008 2008%   Indices Ticker 1/2/2008 12/31/2008 2008%
AT & T T 41  $       28.50 -30.5%   NYSE ^NYA 7,753.95 5,757.05 -25.75%
Comcast CMCSA 17.7  $       16.88 -4.6%   DJIA ^DJI 10,717.50 8,776.39 -18.11%
Tootsie Roll TR 26.33  $       25.61 -2.7%   S&P 500 ^GSPC 1,248.29 903.25 -27.64%
Plantronics PLT 25.4  $       13.20 -48.0%   Nasdaq ^IXIC 2,205.32 1,577.03 -28.49%
Tata Motors TTM 19.45  $         4.45 -77.1%     Total 21,925.06 17,013.72 -22.40%
Electronic Arts ERTS 56.76  $       16.04 -71.7%            
Rainmaker RMKR 6.12  $         0.85 -86.1%            
Philips PHG 42.34  $       19.87 -53.1%            
Johnson Controls JCI 34.59  $       18.16 -47.5%            
Etrade ETFC 3.43  $         1.15 -66.5%            
Chinindia ETF FNI 27.37  $       11.60 -57.6%            
Makita MKTAY 41.95  $       22.18 -47.1%            
Total 342.44  $      178.49 -47.9%            
    Avg return -43.7%            
2007                    
Picks Ticker 12/29/2006 12/31/2007 2007%   Indices   12/29/2006 12/31/2007 2006%
Microsoft MSFT  $       29.86   $       35.60  19.2%   NYSE ^NYA  $  9,139.02   $  9,740.32  6.58%
Nintendo NTDOY.PK  $       32.50   $       74.05  127.8%   DJIA ^DJI  $12,463.15   $13,264.82  6.43%
Toyota TM  $     134.31   $     106.17  -21.0%   S&P 500 ^GSPC  $  1,418.30   $  1,468.36  3.53%
Google GOOG  $     460.48   $     691.48  50.2%   Nasdaq ^IXIC  $  2,415.29   $  2,652.28  9.81%
Yahoo YHOO  $       25.54   $       23.26  -8.9%     Total 25,435.76 27,125.78 6.64%
Cummins CMI  $       59.09   $     127.37  115.6%            
Caterpillar CAT  $       61.33   $       72.56  18.3%            
Dell DELL  $       25.06   $       24.51  -2.2%            
China ETF FXI  $     111.45   $     170.45  52.9%            
Korea ETF EWY  $       49.40   $       64.70  31.0%            
Brazil ETF EWZ  $       46.85   $       80.70  72.3%            
India ETF INP  $       52.45   $       97.79  86.4%            
Total  $  1,088.32   $  1,568.64  44.1%            
    Avg return 45.1%            
2006                    
Picks Ticker 12/30/2005 12/29/2006 2006%   Indices   12/30/2005 12/29/2006 2006%
Cisco  CSCO   $       17.12  27.33 60%   NYSE ^NYA 7,753.95 9,139.02 17.90%
Honda HMC  $       28.97  39.54 36%   DJIA ^DJI 10,717.50 12,463.15 16.30%
Infosys  INFY   $       40.43  54.56 35%   S&P 500 ^GSPC 1,248.29 1,418.30 13.60%
Toyota  TM   $     104.62  134.31 28%   Nasdaq ^IXIC 2,205.32 2,415.29 9.50%
Apple  AAPL   $       71.89  84.84 18%     Total 21,925.06 25,435.76 16.01%
Google GOOG  $     414.86  460.48 11%            
Walmart WMT  $       46.80  46.18 -1%            
Ford F  $         7.72  7.51 -3%            
Motorola  MOT   $       22.56  20.56 -9%            
Yahoo YHOO  $       39.18  25.54 -35%            
Total  $     794.15   $     900.85  13.4%            
    Avg return 22.6%            
2005                    
Picks   12/31/2004 12/30/2005 Return   Indices Ticker 12/31/2003 12/31/2004 Change
AAPL AAPL  $       32.20   $       71.89  123.3%   NYSE ^NYA 7,250.06 7,753.95 6.95%
Google GOOG  $     192.79   $     414.86  115.2%   Dow Jones ^DJI 10,783.01 10,717.50 -0.61%
Texas Instruments  TXN  $       24.62   $       32.07  30.3%   S&P500 ^GSPC 1,211.92 1,248.29 3.00%
Amazon AMZN  $       44.29   $       47.15  6.5%   NASDAQ ^IXIC 2,175.44 2,205.32 1.37%
Ask Jeeves ASKJ  $       26.75   $       28.31  5.8%     Total 21,420.43 21,925.06 2.36%
Yahoo YHOO  $       37.68   $       39.18  4.0%            
PalmOne PLMO  $       31.55   $       31.80  0.8%            
Starbucks SBUX  $       31.18   $       30.01  -3.8%            
Sprint FON  $       24.85   $       22.82  -8.2%            
Walmart WMT  $       52.82   $       46.80  -11.4%            
Sears S  $       51.03   $       43.86  -14.1%            
Research in Motion RIMM  $       82.42   $       66.01  -19.9%            
Ebay EBAY  $       58.17   $       43.22  -25.7%            
Kodak EK  $       32.25   $       23.40  -27.4%            
Ford FORD  $       14.64   $         7.72  -47.3%            
Total  $     737.24   $     949.10  155.6%            
    Avg return 8.5%            
2004                    
Picks Ticker 12/31/2003 12/31/2004 Change   Indices Ticker 12/31/2003 12/31/2004 Change
Toyota TM 68.75 81.87 19.1%   NYSE ^NYA 6,464.00 7,250.06 12.16%
Wipro WIT 15.4 24.65 60.1%   Dow Jones ^DJI 10,453.92 10,783.01 3.15%
Intel INTC 31.85 23.39 -26.6%   S&P500 ^GSPC 1,111.92 1,211.92 8.99%
Microsoft MSFT 24.48 26.72 9.2%   NASDAQ ^IXIC 2,003.37 2,175.44 8.59%
Inuit INTU 52.86 44.01 -16.7%     Total 20,033.21 21,420.43 6.92%
Adobe ADBE 39.08 62.74 60.5%            
Sina.com SINA 33.75 32.06 -5.0%            
Yahoo YHOO 22.51 37.68 67.4%            
Total 288.68 333.12 15.4%            
    Avg return 6.4%            

2011 Predictions

America's "greatness" continues to erode as the world economy redistributes the balance of power. The shock of the economic downturn has left lasting impressions; look around and you'll see it's still tough to find a new job. Folks will continue to be more frugal. In the short term, if Obama wants to stimulate the economy and generate jobs, he'll penalize companies for outsourcing jobs overseas and place tariffs on imports.

Two best companies to invest in aren't public: Facebook and Groupon. While Facebook is rumored to go public in the next year or so, both them and Groupon aren't public yet. Facebook has become the new Yahoo! and Groupon is the reincarnation of the yellow pages.

Apple continues to dominate. Sony and Dell-- do something! Will Apple ever stop? As they continue to bridge the gap between computing/electronics and our lifestyles, they will continue to become more ubiquitous. They have so many opportunities; imagine ipod-like controls for your car infotainment system--who will be the first automotive partner for them? Meanwhile, Sony and Dell HAVE to re-innovate themselves. 2011 might be the year for them.

Brett Favre and Lance Armstrong. 2011 marks the end of two GREATS. Brett Favre is one of the most entertaining and enduring characters on the pro football landscape. He is fun to watch and captures the "go for it!" and irresponsible nature that makes us all feel young. That said, we will forget him and his antics quickly. On the cycling side, Lance Armstrong was the most magnetic personality in the history of the sport. His epic tale will never be repeated. Unfortunately, there really are no heirs to his throne--and cycling will fade in brain-share for Americans for many years.


2011 Stock Picks: Football Theme

Stock picks have a football theme for 2011; "forgive and forget" and "the Hail Marry".

Forgive and Forget. Americans have terrible short term memory and we love to forgive. Heroic and flawed sports stars like Michael Vick, Kobe Byrant, Ben Roethlisberger, and Ray Lewis have come back bigger and better. To this end, "the forgiven" lead the pack in stocks for 2011, including Bank of America, Wells Fargo, Citibank, and BP.

Hail Marry. The companies that need to innovate to survive are Dell, Yahoo, and Sony.

Picks Ticker 12/31/2010 52wk Lo 52wk Hi P/E 1yrtarget %vsTarget %vsHi %vsLow
Bank of America BAC 13.34 10.91 19.86 N/A 17.74 -25% -33% 22%
Wells Fargo WFC 30.99 23.02 34.25 18.11 35.99 -14% -10% 35%
Citibank C 4.74 3.11 5.07 89.25 5.39 -12% -7% 52%
BP BP 44.17 26.75 62.38 N/A 46.66 -5% -29% 65%
Dell DELL 13.55 11.34 17.52 13.03 16.09 -16% -23% 19%
Yahoo YHOO 16.63 12.94 19.12 21.6 18.27 -9% -13% 29%
Sony SNE 35.71 25.85 40.45 37.71 38.96 -8% -12% 38%
  159.13 113.92 198.65   179.10 -11% -20% 40%
                 
Indices Ticker 12/31/2010              
NYSE ^NYA 7,964.02              
DJIA ^DJI 11,577.51              
S&P 500 ^GSPC 1,257.64              
Nasdaq ^IXIC 2,652.87              

 

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