While I was Not Surfing

 

I did some homework today and felt it appropriate to share it with you.  We have a list of equities we told you about and promised some stop points.  Here is what we came up with.

 

BOFI

 

BofI Holding, Inc. operates as the holding company for BofI Federal Bank that provides various consumer and wholesale banking services primarily through the Internet in the United States. It accepts various deposit products, including demand deposit, savings, and certificates of deposit accounts. It also provides loan products, which consist of single family loans, home equity loans, multifamily loans, commercial real estate loans, recreational vehicle and automobile loans, and overdraft lines of credit. In addition, the company offers online bill payment, interbank transfer, mobile banking, text message banking, ATM cards or VISA debit cards, and overdraft protection services. It serves approximately 36,000 retail deposit and loan customers across 50 states. BofI Holding, Inc. was incorporated in 1999 and is based in San Diego, California.

 

We are currently (8/10/2012) up about 15% on this stock and seriously thinking about taking some profit.  It's near perfect entry point was back in March 2012 at about $17.25.  We got in at 19.26 a couple of months ago.  We ran across the stock using the Auer Fund Screen and MY Buffet Valuation worksheet.  We still like it and want to keep it, but are tempted to take a couple of share off the table.  Patience Brian patience.

 

SYY

 

Sysco Corporation, through its subsidiaries, engages in the marketing and distribution of a range of food and related products primarily to the foodservice or food-away-from-home industry. It distributes a line of frozen foods, such as meats, fully prepared entrees, fruits, vegetables, and desserts; a line of canned and dry foods; fresh meats; dairy products; beverage products; imported specialties; and fresh produce. The company also supplies various non-food items, including paper products, such as disposable napkins, plates, and cups; tableware comprising china and silverware; cookware consisting of pots, pans, and utensils; restaurant and kitchen equipment and supplies; and cleaning supplies. In addition, the company distributes personal care guest amenities, equipment, housekeeping supplies, room accessories, and textiles to the lodging industry. It serves restaurants, hospitals, schools, hotels, industrial caterers, lodging establishments, and other foodservice customers through distribution facilities. As of July 2, 2011, the company operated 177 distribution facilities in the United States, Canada, and Ireland. Sysco Corporation was founded in 1969 and is headquartered in Houston, Texas.

 

The last decent entry point for this stock was at $29.75.  The stock is currently at 28.85 or so.  Our stop would be placed at $25.10 and we would consider this a core holding, meaning if we do not hit our stop we intend to hold for at least 12 months. 

 

Those numbers are based upon technical performance and I am getting some direction from MarketSmith.  Fundamentally there is a lot to like about the company (BTW, I almost went to work for them in 1982 in Las Vegas NV.) besides their good decision not to hire me.  They are the largest food distributor in the US, having almost double their nearest competitors market share.  (US Food Service is you were wondering.) 

 

According to Morningstar who attended the May analyst day, SYY is on a mission to leverage technology to continuously improve (Thank you Doctor Deming) their supply chain management.  This will ensure a wider competitive moat for SYY.  Their Return on Equity is a healthy 25 plus.  They are spending 300 million or more to improve their fleet.  Management blames recent weakness on their adapting and new ERP program,  (Enterprise Resource Planning-thing enterprise software.) and having been involved in a few much smaller software launches, it is like getting surgery.  It hurts at first but usually makes things better.

 

If the economy continues is painfully slow recovery, it should play well for Sysco.  Morningstar has a 36 dollar value on the company, which we feel is aggressive.  In a day and age where SAFE money is making less than 1.5%, we would like to see a 10% gain on this stock and consider taking profits at 32.  Again out stop will be at $25.10.

 

Oh Yeah, its 3.7% sustainable dividend yield is nothing to sneer at either.     

 

INTC

 

Intel Corporation designs, manufactures, and sells integrated digital technology platforms primarily in the Asia-Pacific, the Americas, Europe, and Japan. The company offers microprocessors that process system data and controls other devices in the system; and chipsets, which sends data between the microprocessor and input, display, and storage devices, such as keyboard, mouse, monitor, hard drive or solid-state drive, and CD, DVD, or Blu-ray drives; system-on-chip products that integrate its processing functions with other system components, including graphics, audio, and video onto a single chip; wired network connectivity products; and wireless connectivity products. It also provides mobile phone components comprising baseband processors, radio frequency transceivers, and power management integrated circuits; and mobile phone platforms, such as Bluetooth wireless technology and GPS receivers, software solutions, customization, and interoperability tests. In addition, the company offers endpoint security, network and content security, risk and compliance, and consumer and mobile security software products for consumer, mobile, and corporate environments to protect systems from malicious virus attacks, as well as loss of data. Further, it develops and licenses embedded and mobile device software products that comprise operating systems, virtualization technologies, middleware, and development tools; and provides NAND flash memory products, which are used in solid-state drives, portable memory storage devices, digital camera memory cards, and other devices. The company markets its products primarily to original equipment manufacturers, original design manufacturers, and industrial and communications equipment manufacturers in the computing and communications industries. Intel Corporation was founded in 1968 and is based in Santa Clara, California.

 

Intel is throwing a very sustainable 3.3% yield.  It is off a really nice entry point of $27.75 set up in about June.  Currently at $26.88 its an attractive equity.  This is a range bound steady eddy tracking between 24-28, while increasing its dividend.  It is cash rich and it would not be surprising to see it start buying some market share.  The rumored Qualcomm AMD merger might make it possible for INTC to buy Broadcom.  That would fill a lot of wholes in INTC product offerings and take some of the sting out of the fledging but ever growing ARMH ARM Holdings designer chip house out of England.  (Long time readers will remember our success with ARMH here and in the UK.)

 

On the down side, the overall market has slowed as global unemployment has stagnated.  Jobs equal computers, computers equal chips.  iPhone, Smart Phones, iPads, and big screen TV have helped maintain INTC marginal growth, but it still generates GOBS of cash.  If INTC could acquire ARMH and Broadcom, that would be the end of all end runs, but the Office of Fair Trade in Europe, Australia, Canada, The UK, and our very own Federal Trade will probably keep that from happening. 

 

We are in at $26.81 with a stop at $25.00.  We would suggest keeping an eye on the merger rumors.  We want to hang with INTC at least two years if we can. 

 

That's all I got after a veal plate and risotto that was to die for.  I will have a Barron's review tomorrow.  (Don't worry Tim, I am doing my homework.)

 

 

Salve Lucrum

 

 

BAGAKOAA;

FinVIZ

  

  

  

  

IBD 

                           Survey Of One

  

  

In Play