Friday, January 23, 2009

Gold -- is the keyword.


With Obama's Treasury pick calling out the Chinese on currency manipulation, talks of the dollar falling apart has been louder and louder. Why? Because of our debt.

The U.S. government's spending spree to pay for wars and do loan bailouts are going to cost us. Countries like the Chinese have been buying U.S. debt. However, if the Chinese were to suddenly stop buying U.S. debt -- it would essentially cut our ability to repay our obligations.

This is why I'm buying NYSE: GLD [SPDR Gold Trust]. At 87.98, it's going to be a bargain. If the Dow continues to hit below 8,000 -- the dollar will continue to feel pressure and gold and other metals will continue to spring up as investors flock to metal commodities.

Friday, January 16, 2009

Steve Jobs takes a leave of absence

As reported by the Wall Street Journal, Steve Jobs is taking a medical leave until the end of June due to worsening health issues. Mr. Jobs said in an email to employees that he would be handing over the reins of the company temporarily to Tim Cook, Apple's chief operating officer, who filled in for Mr. Jobs when he took a leave in 2004 to battle pancreatic cancer.

We wish him well! As the market reacts and continues to drag the shares price, looks like Apple shares will be a bargain buy at $80's range.

Going to be buying (more of) it at $81.16.

Monday, January 5, 2009

Steve Jobs has a hormone imbalance, not cancer


Steve Jobs doesn't have cancer!

Expect Apple to go up several percentage points today as Steve Jobs announced his health illness is not related to cancer but related to a hormonal problem. This will certainly reassure investors as hormonal issues, specifically on how to gain weight back, is a simple problem to fix. “The remedy for this nutritional problem is relatively simple and straightforward,” Jobs said.

For my MSP performance portfolio, I'm doing a buy rating at 94.44 today.

Thursday, January 1, 2009

Stock Pick: United States Oil Fund (NYSE: USO)


Am I nuts? With oil dropping to one of its lowest points in years, why in the world would I be buying United States Oil Fund? (I will be when the market opens.)

1/1/09 Price Per Share: $33.10

Description
United States Oil Fund, LP (USOF) is a commodity pool that issues limited partnership interests or units that may be purchased and sold on the American Stock Exchange (the AMEX). The Company invests in futures contracts for light, sweet crude oil and other types of crude oil, heating oil, gasoline, natural gas and other petroleum-based fuels that are traded on the New York Mercantile Exchange (NYMEX), International Currency Exchange (ICE) Futures or other United States and foreign exchanges (collectively, Oil Futures Contracts). It holds interests in other oil-related investments such as cash-settled options on Oil Futures Contracts, forward oil contracts, and oil-based over-the-counter transactions.

Trends in Recession
Bear with me so I can break the reason behind this pick. Oil is low now -- but the supply and demand cycle will look entirely different in 2009 and 2010. USO lost 56% its value in '08 largely matching the decline of oil prices but could potentially gain all of that back and then some if OPEC continues to drop production, if the global economy picks up steam in late '09 and 2010, and if we continue to have "peripheral" issues that affect oil prices: problems in the Middle East, piracy, etc.

Summary
At $33.10, knowing the potential turn around of the economy and the spike in demand in the future, at this price, it is a bargain.

-Don

Stock Pick: Philippine Long Distance Telephone Co (NYSE: PHI)


Philippine Long Distance Telephone (NYSE: PHI) is a good mid to long term buy for me, a stock I continue to hold and invest in.

1/1/09 Price Per Share: $46.95

Company Description
Philippine Long Distance Telephone Co (PLDT) is the Mama Bell of the Philippines. It is one of the most diversified telecommunications company in Southeast Asia and almost runs a fixed line monopoly in the Philippines.

PLDT operates through three segments: Wireless, Fixed Line, and Information and Communications Technology. The Company offers a range of telecommunications services to approximately 32 million subscribers in the Philippines. The Company is a fixed line service provider in the Philippines with approximately 59% of the total reported fixed line subscribers as of December 31, 2007. Smart Communications, Inc. (Smart) it’s wholly owned subsidiary, is the cellular service provider, with approximately 37% of total reported cellular subscribers as of December 31, 2007.

Trends in Recession
PLDT met its target for cellular subscribers in 2008. It operates under the SMART brand name. This, with its steady cash flow from a near monopoly of fixed line subscribers and DSL service, continues to put PLDT as a solid market leader in the Philippines.

One of the best run and most respected companies in the Philippines, PLDT also pays $1.50 per share price as a dividend.

Summary
The Philippines is one of the few countries that is not in a recession, thanks large in part to its global imprint with overseas workers. There is roughly 2,500 Filipinos that leave the country every day to work abroad. The remittances being sent from this Filipino diaspora accounts to roughly 10-15% of the country's GDP, with 2008 being a record year. PLDT and other companies directly benefits from this.

-Don

Stock Pick: Archer Daniels Midland Company (NYSE: ADM)


Archer Daniels Midland Company (NYSE: ADM) is a good mid to long term buy for me, a stock I continue to hold and invest in.

1/1/09 Price Per Share: $28.83

Company Description
Archer Daniels Midland Company is primarily a business to business provider. They are a leader in procuring, transporting, storing, processing, and merchandising agricultural commodities and products. They are a processor of oilseeds, corn, wheat, cocoa, and other feedstuffs, and is a manufacturer of soybean oil and protein meal, corn sweeteners, flour, biodiesel, ethanol, and other food and feed ingredients.

Trends and Recession
From renewable energy to vegetarian trends to soy milk to the box of cereal in your house, ADM is heavily involved in making sure companies can manufacture and deliver those products to your home by providing the essential ingredients or components.

While the price of commodities and other external factors will affect ADM -- the fact that it continues to diversify and find innovative ways to sell its products and services, plus have a steady cash flow, in my opinion, will not only help ADM survive this downturn but it will continue to solidify its market position.

Summary
ADM recently beat the consesus on their fiscal first quarter, coming in at 133% over market estimates. While that's noteworthy, the better story is their historical performance and their dividends. In 2004, they were paying roughly 7 cents a share. In 2008, they were paying 13 cents a share.

They are a solid buy for mid-term to long-term position.

-Don

Question: Should I buy (NASDAQ: APPL) Apple now?


Question: Should I buy (NASDAQ: APPL) Apple now?

I asked myself this question over the holidays. My answer after a few brief seconds was a 'no' and to wait and see... The whole world is waiting for some type of announcement regarding Steve Jobs.

1. Short term looks bad for the stock but good for discount buying - Steve Jobs' no show and rumors of him being sick will bring the stock price down. This is a good buying opportunity. Jobs may resign his CEO post and create a "creative thinker" position to reduce the fear factor among the shareholders, similar to what Bill Gates did. I hope and pray he will be well and won't suffer through a cancer recurrence. If he is going through some sort of serious illness now, he needs to take a breather and not get stressed out.

2. Mid term looks slow...
Despite the WalMart iPhone announcement, expect weaker overall sales. Corporations aren't buying and consumers are in save mode. Drop by at my hometown's Apple stores and you will see less folks walking in, while last year I saw it packed during the holidays and I felt a bit cramped.

3. Long term looks okay if they launch a netbook. I'm expecting an Apple netbook at some point priced around $600 (or $599). Netbooks from Dell, Asus, and others were selling like hot cakes during the holidays -- expect more of this to come...cheap, compact, and workable notebooks that can do your homework, basic games, and Internet needs -- that's what people looking-for-a-laptop-for-the-first-time buy in a recession. Or people that travel a lot and have big 15 inch laptops but want a smaller one. (Yeah, I'm one. I expect to buy a netbook this year that can run Microsoft Office.)

-Don

Happy New Year!


Happy New Year!

Year 2009 is here and hopefully this year we are one step closer to bringing this crazy recession to an end. By encouraging trading and smart "picking", we hope to somewhat help with the recovery.

On January 1, 2009, MysteryStockPicks.com was put online to deliver:

  1. Good, free, stock picks. We are so sick and tired of newsletters with user registration requirements (and hidden fees) that we thought....hmm...we could probably do it better!
  2. Research and data driven. We will share our stock picks that are based on data and trends!
  3. Legal and no insider trading. We will not entertain insider trading information.
  4. Mostly mid-term to long-term. We aren't day traders, sorry. If we do see some stocks providing some short term lifts and then profit taking, of course, we will post it. But for the most part, expect our stock picks to be mid-term to long-term buys.
If you got questions about the site, let us know by e-mailing us at mysterystockpicks [at] gmail.com.

Thanks!

Don Sausa
Author of Investing Without Losing Series

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