BAGAKOAA; September 23, 2012Television Compatibility

Post 713

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September/2012

Television Compatibility

 

It about 10:34 PM as I start tonight's saga.  We just finished watching the season premier of #DWTS.  That is twitter speak for Dancing With The Stars.  Yes, this is the only show we actually watch together.  (If you don't count those NCIS marathons that go one for twenty-two hours long.  I am convinced they are covers for aliens when they do those body probes.)

 

Yah see I could really enjoy the Hallmark Channel (one of Devin's favorites) more of they would throw in some gratuitous violence, brief nudity, and a car chase now and again.  Think about what it would do for their ratings.  Imagine a show called REALLY Touched By An Angel.  So it goes that DWTS is the only show we can enjoy together.  We do DVR it as to not numb our mind with all the commercials.

 

Now some of you know me and I am sure you are just sitting there saying, "Brian, who are you kidding.  You are just a perv who wants to see those scantily clad women running about the stage."  Well, I have a confession.  I really do enjoy the show, scantily clad women and athletic guys with giant thighs, and all.  Devin and I really connect during the show and that is kinda cool.

 

So it's been a long day.  I guess I had one of those Devin days I used to hear about when I got home for work.   I was up by 6:00, got Jack ready and off to school.  Got ready for a meeting our other Financial Advisor Jeff D.  (Which makes me wonder why these people who really do financial advising for a living read my blog.  I am sure its so they have something amusing to tell their spouse when they get home when they get together with their FA friends.  I am sure the conversation goes something like this, "I got this one client and he is SO upside down in VXX call options that he just loaded up on more."  Or, "I have this client who actually prognosticates what the market will do for the week on Sunday night.  It's hilarious."), cleaned up about 74 e-mails, read 11 investment newsletters and blogs, read the IBD and the WSJ, got a recipe for dinner, supervised our audio visual guys hooking up a TV, booked dinners and car rides for the next couple of weeks, picked up two new cable boxes, picked up Jack from school, hooked up two new cable boxes, explained to our next door neighbor that water does not flow uphill, but down hill into our yard, (Actually had to demonstrate?), fixed an incredible salmon pasta dish for dinner (Recipe soon, but not tonight.), watched DWTS and was rewarded for all of my efforts by seeing my son, cleaning the kitchen at 9:35 PM.  What a nice sight.

 

So how was your day?  BTW, Jeff D., our other FA might become our newest reader.  Welcome aboard Jeff.  Hope you find my post entertaining.  Speaking of entertaining, let's see how we did in the market today.

 

 

We Got One In A Row

 

We called a flat day on light volume and we got a DOW off 20 points and an S&P off 3 on light volume.  AAPL did not go up as we suggested, but instead did a "buy on the rumor and sell on the news" classic textbook move and sold off a teeny tiny bit.  Only 5 Million units sold this weekend.

 

Can anybody else think of a company that sold 5 million units with an average price of $260.00 this weekend?  (Sorry got to count the upgrades so they did not all see at 400 bucks.)

 

So did you all run out and buy some AAPL at 700 or so?  If your horizon is beyond 12-18 months it still is a good buy.  But lets say just don't want to ante up 700 a share to take a bite of the Apple.  Here is another way to play the game.  No Hutch, I am not pitching call options again, although some 2013 LEAPS might not be a bad idea.  What I am talking about is the guts of the iPhone 5.  What goes into to one?

 

Ok I am taking apart Devin's brand new 64 Gig iPhone 5.  Write these names down as I get to the parts.  There is a Sony (SNE) 3.8 V battery which will give it a bit more stand by power.  Oh yeah, there on the back of the Meg camera is an image sensor made by, I can barely make it out, Sony.  Mmm.  Sony is at 12 bucks a share?  (That is not a recommendation and we do not have SNE, just food for thought.)

 

Then we have some chips on board.  It looks like the Ram chip is made by our old friends at ARMH (The ADR for the British Chip designer ARM Holdings).  We all, well at least those that listened did quite well with ARMH in 2010 because of the iPhone 3.  Could this be a replay?  Do your homework.

 

There is another chip on board made by Samsung which Apple just won a lawsuit against which could (but won't) preclude Samsung from supplying Google's Android phones.  (GOOG hit an all time high today.  We are long GOOG.)

 

There is a power amplifier made by Skyworks SWKS at 24 bucks a share.  Do your homework, as we do not own this stock.  There is also another power amp made by Triquint Semi TQNT at 5 dollars a share, we do not own that either. 

 

I can also see a dual band duplex module made by Avago Tech AVGO selling for 34 bucks a share, we do not own that either, do your homework. 

 

The modem is made by Qualcomm @ 63 dollars a share.  We do not own it so study it first.

 

The gyroscope and accelerator which allows you to flip the phone around and change screen formats is made by STMicroelectronincs STM @ 5.88 a share.  Do your homework.

 

Then there is this Wi-Fi Module made by Murata MRAAY.PK which I do not know anything about but they are on the pink sheets.

 

The cool touchscreen is made by Texas Instruments TXN at 28 bucks a share.  Do your homework.

 

The touch screen controller is made by Broadcom BRCM @ 35 a share.  We have done our homework on BRCM, we do not own it but it is a sound good investment with target prices in the 42-48 range.

 

I can hear an audio chip made by Cirrus Logic CRUS @ 40 a share.  Do your homework. 

 

OMG this thing is in pieces and its already 11:45.  I got to get this back together again.  I'd like to thank the folks at Seeking Alpha, iFixit, and China Tech News, for most of the info on the iPhone 5 breakout.

 

Let's Get Down To Earth

 

After all that tech talk, let's get some dirt under our fingernails.  I read two good articles today about Ag stocks.  The Journal and Seeking Alpha had a few ideas.  We will be doing homework on this in the next day or so, but if you want to kick the tires, here are a few to consider.

 

MON Monsanto Company, together with its subsidiaries, provides agricultural products for farmers in the United States and internationally. It operates in two segments, Seeds and Genomics, and Agricultural Productivity. The Seeds and Genomics segment produces corn, soybean, canola, and cotton seeds, as well as vegetable seeds, including tomato, pepper, melon, cucumber, pumpkin, squash, beans, broccoli, onions, and lettuce seeds. This segment also develops biotechnology traits that assist farmers in controlling insects and weeds, as well as provides genetic material and biotechnology traits to other seed companies. The Agricultural Productivity segment offers glyphosate-based herbicides for agricultural, industrial, ornamental, and turf applications; lawn-and-garden herbicides for residential lawn-and-garden applications; and other herbicides for the control of preemergent annual grass and small seeded broadleaf weeds in corn and other crops. The company offers row crop seeds principally under the DEKALB, Asgrow, Deltapine, and Vistive brand names; vegetable seeds under the Seminis and De Ruiter brand names; traits primarily under the Roundup Ready, Bollgard, Bollgard II, YieldGard, YieldGard VT, Genuity, Roundup Ready 2 Yield, and SmartStax brand names; seed treatment products under the Acceleron brand name; and herbicide products under the Roundup and Harness brand names. It also licenses germplasm and trait technologies to seed companies. The company sells its products through distributors, independent retailers and dealers, agricultural cooperatives, plant raisers, and agents, as well as directly to farmers. It has a collaboration agreement with BASF in plant biotechnology that focuses on high-yielding crops and crops that are tolerant to adverse conditions. The company was founded in 2000 and is headquartered in St. Louis, Missouri.

MY COMMENTS:It has had a great run this year up about 45%.  It is selling for about 91 and there are TPs in the 95 range.  Forward looking PE is 21 which is a little rich.  Keep it on your radar and wait for the inevitable pull back to say 87.50?  I really like their Gross margin at 52%.  If you can be in for the long haul, this is a major AG player.

 

POT Potash Corporation of Saskatchewan Inc., together with its subsidiaries, produces and sells fertilizers and related industrial and feed products primarily in the United States and Canada. The company mines and produces potash, which is used as fertilizer. It also offers solid and liquid phosphate fertilizers; animal feed supplements; and industrial acids that are used in food products and industrial processes. In addition, the company produces nitrogen fertilizers and nitrogen feed, as well as industrial products, including ammonia, urea, nitrogen solutions, ammonium nitrate, and nitric acid. Further, it holds the right to mine 785,867 acres of land in Saskatchewan; and 58,263 acres of land in New Brunswick in Canada. The company sells its fertilizers to retailers, dealers, cooperatives, distributors, and other fertilizer producers; industrial products primarily to chemical product manufacturers; and purified phosphoric acid directly to consumers of the product. Potash Corporation of Saskatchewan Inc. was founded in 1953 and is headquartered in Saskatoon, Canada.

 

MY COMMENTS:It's looking more like a bargain than it did in February and it throws a sustainable 2% dividend.  The ROE is a very healthy 30.3% and with a forward PE below 12, if Fertilizer is your game POT is the name.  WE DO NOT OWN POT.

 

SYT Syngenta AG, an agribusiness company, engages in the discovery, development, manufacture, and marketing of a range of products designed to enhance crop yields and food quality worldwide. The company operates in three segments: Crop Protection, Seeds, and Business Development. The Crop Protection segment offers herbicides for corn, cereals, soybean, and rice; fungicides for corn, cereals, fruits, grapes, rice, soybean, and vegetables; insecticides for fruits, vegetables, and field crops; seed care for corn, soybean, cereals, and cotton; and professional products, such as products for public health, and turf and ornamentals. This segment markets its products through independent distributors and dealers, agricultural consultants, and growers. The Seeds segment develops, produces, and markets seeds and plants based on advanced genetics and related technologies. This segment provides approximately 200 product lines and approximately 6,800 varieties of proprietary genetics, including vegetables, flowers, corn, soybean, sugar beet, and sunflower primarily under the NK, Golden Harvest, Garst, HILLESHG, S&G, Rogers, Zeraim Gedera, and Fischer brand names. The Business Development segment engages in the development of enzymes and traits to enhance agronomic, nutritional, and biofuel properties of plants. The company was founded in 1999 and is headquartered in Basel, Switzerland.

 

MY COMMENTS:Not as familiar as MON and POT, SYT is a Swiss ag chemical firm.  At 73 a share, it has blown by most analyst target prices, but its forward looking PE is a reasonable 15 and change.  Tere is not a lot of margin of safety on this stock, but put it on a watch list and look for a pull back below 70.

 

DE Deere & Company provides products and services primarily for agriculture and forestry worldwide. Its Agriculture and Turf segment manufactures and distributes a line of farm and turf equipment, and related service parts, which include large, medium, and utility tractors; loaders; combines, corn pickers, cotton and sugarcane harvesters, and related front-end equipment and sugarcane loaders; tillage, seeding, and application equipment, such as sprayers, nutrient management, and soil preparation machinery; and hay and forage equipment comprising self-propelled forage harvesters and attachments, balers, and mowers. This segment also offers turf and utility equipment, including riding lawn equipment and walk-behind mowers, golf course equipment, utility vehicles, and commercial mowing equipment; integrated agricultural management systems technology; precision agricultural irrigation equipment and supplies; landscape and nursery products; and other outdoor power products. The company's Construction and Forestry segment provides a range of machines and service parts used in construction, earthmoving, material handling, and timber harvesting comprising backhoe loaders; crawler dozers and loaders; four-wheel-drive loaders; excavators; motor graders; articulated dump trucks; landscape loaders; skid-steer loaders; and log skidders, feller bunchers, log loaders, log forwarders, log harvesters, and related attachments. This segment markets its products and services primarily through independent retail dealer networks and retail outlets. Its financial services segment finances sales and leases of new and used agriculture and turf equipment, as well as construction and forestry equipment. This segment also provides wholesale financing to dealers of the foregoing equipment, offers operating loans, finances retail revolving charge accounts, and provides crop risk mitigation products and extended equipment warranties. The company was founded in 1837 and is based in Moline, Illinois.

 

MY COMMENTS:At 82 dollars a share we have a forward looking PE of 9.96 making the this a cheap tractor to ride.  ROE is a phenom 40.8%.  They have some debt, but that is not unusual for an industrial like this.  We will be reading SEC reports on this cause I am liking what I see at face value.

 

ADM Archer-Daniels-Midland Company engages in the manufacture and sale of protein meal, vegetable oil, corn sweeteners, flour, biodiesel, ethanol, and other value-added food and feed ingredients. The company's Oilseeds Processing segment is involved in the origination, merchandising, crushing, and processing of oilseeds, such as soybeans and soft seeds into vegetable oils and protein meals. Its products include oilseeds products; crude vegetable and salad oils; margarine, shortening, and other food products; partially refined oils; oilseed protein meals; cottonseed flour; and cotton cellulose pulp. This segment also engages in the blending of fertilizers; procurement and processing of cocoa beans into cocoa liquor, cocoa butter, cocoa powder, chocolate, and various compounds; and supply of peanuts and peanut-derived ingredients. The company's Corn Processing segment converts corn into sweeteners, starches, and bio products. Its products include sweeteners, starch, syrup, glucose, and dextrose; alcohol, amino acids, and other specialty food and animal feed ingredients; ethyl alcohol; corn gluten feed and meals, and distillers' grains; citric and lactic acids, lactates, sorbitol, xanthan gum, and glycols; propylene and ethylene glycol; and sugarcane ethanol. The company's Agricultural Services segment engages in buying, storing, cleaning, and transporting agricultural commodities, such as oilseeds, corn, wheat, milo, oats, rice, and barley; and reselling those commodities primarily as food and feed ingredients. This segment is also involved in the merchandising of agricultural commodities and processed products; origination and processing of wheat flour; and processing and distribution of formula feeds, animal health and nutrition products, and edible beans. The company also engages in futures commission merchant business. Archer-Daniels-Midland Company was founded in 1898 and is headquartered in Decatur, Illinois.

 

MY COMMENTS:ADM makes more of the consumables like sweeteners and vegetable oils, but it is a good ag play. At 27.51 it is reasonably priced and their front office holds about 24% of the stock, so they have some skin in the game.  TPs range from 29-31 so there is some margin of safety.  This is worth a closer look. 

 

Hope that get's you through the day. 

   

Salve Lucrum

 

 

 

 

 

 

 

 

 

 

 

Brian Ireland
 
 
Since 7/26/2012
BAGAKOAA;

I am not a professional investment advisor. Anybody reading my blog and investing accordingly must be out of their minds. I have made more money than I have lost. There are many more qualified people than I to actually tell you how to invest your money.

BAGAKOAA=Boys And Girls And Kids Of All Ages

Salve Lucrum=Latin for Hurrah for Profit.

2012 Year Ending

Dow 13,073

S&P 500 1,358

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