The positive today is that oil is coming down, the negative is that the housing numbers are worse than expected. |
The profit outlook is not good and is deteriorating. Profit outlook is what drives stock prices. |
The risk is we are staring down the barrel of negative pre-announcements, so the market has the potential to be disappointed short term. |
The stock is at $24 a share now, down from $50, ... The company is extremely well positioned, the stock could go up 10 points if there is evidence that the economy turns in third quarter. |
The stock is cheap, not well followed, and I think it's undervalued, ... The stock currently trades at about $21, and I think it will earn about $2.60 a share for the year. |
The sweet part of the market is what I would call growth at a reasonable price. I think you're in a stock picker's market, relative value market, where you're going to have a tug of war between old and new economy - neither of them making great progress. But if you find a good stock with good growth at a reasonable price, it'll be an environment where you'll be able to make money, |
The trade deficit has always lurked in the background as a potential negative for stocks, but it was fine (in the past) because the dollar was strong. |
The tradeoff and struggle in the market is the power of good earnings and the strength of the economy against the fear of higher interest rates and rising oil prices, |
The vulnerability is in individual stocks rather than in the market, ... Any company that misses its earnings is going to get brutally punished. The market has very low tolerance for companies that miss their earnings, and it goes back to the fact that everybody's paid on performance and it's difficult for people to have a long-term view. |
There are a lot of reasons to worry about corporate earnings because of gasoline, oil, high commodity prices. It's almost like damned if you do, damned if you don't, because you're worried about what these commodities are doing to the economy, yet they're the strongest thing in the market. |
There are some signs that the economy is not getting worse, in fact it is getting better. |
There's really nothing you can do about it because you need a parking spot. |
They got pounded, ... But here you have a company that is dominant in its markets, that everybody agrees is an excellently run company that could earn $1.75 (per share) next year, so it's selling at about 11-times earnings. And it's an acquisition candidate down the road. So you see the theme here is growing earnings, low valuation. |
They realize the economy didn't fall apart when oil was at $55 a barrel, and it's not going to fall apart at $59 a barrel, |
This could be a sign for investors about where to put there money. |