Jeffrey Saut – 2012

December

November

October

  • 20121029 “The White Hurricane”
  • 20121022 “Silver Anniversary”
  • 20121015 “Losses?!”
  • 20121010 Gleanings by Raymond James
  • 20121008“A Kid’s Market”
    • I think the upcoming earnings reports will not disappoint.
    • Near-term support exists at 1450 – 1455. Major support resides at 1400 – 1422. With a full load of internal energy I think any pullback will be contained by one of those support zones.
    • Recommendations:
      • Huntington Bancshares (HBAN/$7.19)
      • BB&T (BBT/$33.64),
      • Community Bank System (CBU/$28.41),
      •  I continue to think one of the best ways to invest in the banking complex is using the FBR Small Cap Financial Fund (FBRSX/$19.84)
  • 20121001 “Me, Lord Marlboro and the Dow?”

September

  • 20120924  “Liar’s Poker”
  • 20120917  “The Philosophy of Tops”
  • 20120910  “Performance Anxiety?”
  • 20120905  Raymond James Gleanings
    • No recession in the charts for the near future.
    • Based on a 98% correlation with last year, expect an irregular ralley higher into the a peak in the first or second week in Sept., followed by a pullback and a rally into the year end.
    • Gasoline and certain sectors are the ones to be in.
  • 20120904  “Civility”

August

July

  • 20120716  “Cognitive Dissonance”
  • 20120709“One Way Pockets”. A list of investing legends to read.
    • Recommendations:
      • Allstate (ALL/$34.79/Strong Buy);
      • Covanta (CVA/$17.28/Strong Buy);
      • Johnson & Johnson (JNJ/$67.64/Outperform);
      • Plum Creek Timber (PCL/$40.00/Outperform);
      • Rayonier (RYN/$45.66/Strong Buy); and
      • Stonemor (STON/$26.25/Outperform).
  • 20120703 “Happy Birthday America”
  • 20120702“The Virtue of Necessity”
    • I expect the same outcome that occurred for the past two summers. That being, recession fears … should give way to no recession with an attendant rise in equity prices.
    • It’s almost a rule that after a panic there will be an advance that recovers roughly one-half of the points lost during the panic.
    • If the SPX has a decisive and sustained breakout above 1360, we recommend putting some more cash back to work.
    • Recommendations:
      • Denbury Resources (DNR/$15.11/Outperform);
      • Plains Exploration (PXP/$35.18/Outperform); and
      • Whiting Petroleum (WLL/$41.12/Outperform).

June

  • 20120625“Perspective-or where you stand is a function of where you sit!”
    • Still, to me Friday was merely a reprieve from Thursday’s selling-squall. That seems to be confirmed this morning with the pre-opening SPX futures down some 10 points. I expect some posturing out of Germany early in the week before it agrees to turn on the printing press and rescue Spain, which formally asked for aid over the weekend. If correct, the stock market should continue down into a bottom late this week or early next week.
  • 20120618“MOOD”
    • As the astute GaveKal organization opines, “I think the surprise is going to be America and the surprise is going to be the level of
      productivity the U.S. is going to deliver on the back of reindustrialization, cheaper energy, and smarter policymakers and smarter
      policies.”
    • This week should tell us if this is a “fakeout” rally or something more.
  • 20120611“Atlas Shrugged?!”
    • Recommendations:
      • U.S. Airways (LCC/$12.15/Outperform) by 25% this year and 46% next year.
      • Allstate (ALL/$34.31/$Strong Buy);
      • Davita (DVA/$85.60/Outperform);
      • Dollar Tree (DLTR/$106.72/Strong Buy);
      • Brinker (EAT/$30.90/Strong Buy);
      • Family Dollar (FDO/$69.58/Outperform);and
      • JB Hunt (JBHT/$55.39/Outperform).
  • 20120604“1-800-GET-ME-OUT?”
    • The Dow’s decline is now 22 sessions long. Such “selling stampedes” typically last 17 – 25 sessions before they exhaust
      themselves in a finally panic.
    • Over the past 20 years a break below the 200-DMA by the SPX, after it has stayed above it for three months, has … led to a rally.
    • The SPX needs to quickly recapture 1290, and stay above that level, if a rally is to commence.
    • The decline has left most of the oversold indicators I rely on pretty oversold.

May

  • 20120529“Being There”
    • This year the SPX is also following the presidential-year script, as can be seen in the chart on page 3. Hopefully, this correlation will continue, driven by the bullish theme of more practical leaders.
    • We believed (and have since confirmed) order results for the public builders would reflect surprising strength and a sharp acceleration in activity.
    • Despite the decline, by my work there has been no Dow Theory “sell signal.
    • All of the indicators I monitor extremely oversold, suggestive of at least a near-term bounce.
    • Early high temperatures and low rainfall – if the warmest winter on record is followed by the hottest summer on record there are all kinds of investment ramifications for water stocks, fertilizer stocks, air conditioning stocks, utilities, etc.
  • 20120521“Should Have?!”
    • Accordingly, unless we are in “crash mode,” and I don’t believe that, it is time to ready your “buy list” and begin judiciously recommitting some of that cash to stocks.
    • A tradable bottom is likely at hand unless we are involved in a mini-crash.
    • A potential shopping list include:
      • 3.0%-yielding Automatic Data Processing (ADP/$51.98);
      • 3.8%-yielding Rayonier (RYN/$42.08);
      • 4.3%-yielding Digital Realty Trust (DLR/$68.48);
      • 5.2%-yielding Enterprise Products Partners (EPD/$48.48); and
      • 8.2%-yielding Linn Energy (LINE/$35.24).
  • 20120514“Balance Grasshopper”
    • Of the 63 groups I monitor the ones currently on “buy signals” for the short/intermediate term are: REITs, Insurance P/C, Banks, Restaurants, Building Materials, Specialty Chemicals, Food, Healthcare Supply/Equipment, and Pharmaceuticals.
    • Some names from Raymond James’ research universe that screened positively on both
      their fundamental and technical metrics according to my work, and are favorably rated by our fundamental analysts, include:

      • Allstate (ALL/$34.83/Strong Buy),
      • Simon Property (SPG/$156.08/Outperform),
      • Abbott Labs (ABT/$62.04/Outperform),
      • Cerner (CERN/$79.92/Outperform),
      • Intuitive Surgical (ISRG/$558.95/Outperform),
      • Huntington Bancshares (HBAN/$6.54/Strong Buy), and
      • Kimco Realty (KIM/$19.61/Outperform).
  • 20120507 Toto, I have a feeling we are not in Kansas anymore.”
    • I revisit the dollar/gold topic this morning because I think the most important chart in the world may be in the process of breaking down. The chart in question is that of the U.S. Dollar.
    • A breakdown below February’s intraday reaction low of 78.12, which would also break the index below its 200-day moving average (DMA) at 78.36, would likely confirm the dollar’s downside. The quid pro quo is I think a weaker dollar would be bullish for the equity markets.
    • While I think gold is in a consolidation pattern that will eventually be resolved with higher prices, I don’t think that will happen for a while.
    • Vehicles under consideration for your “buy list,”:
      •  Abbott Labs (ABT/$62.41/Outperform);
      • Equinix (EQIX/$158.94/Strong Buy);
      • Intuitive Surgical (ISRG/$565.16/Outperform).

April

  • 20120430 Truth or Consequences?”
    • Comments on risk management.
  • 20120423 “Dow Direction Dictates”
    • These are two of the most important paragraphs I have encountered in 45 years of studying markets. My advice is to keep this
      quote handy, read it over, and study it every time you get ready to make an important buy or sell decision; especially if your
      emotions reign.
    • You can be cautious, but do not get bearish!
    • stocks that are favorably rated by our fundamental analysts:
      • Brinker (EAT/$27.90/Strong Buy);
      • Baidu (BIDU/$144.91/Strong Buy);
      • Pultegroup (PHM/$8.37/Outperform);
      • and Caterpillar (CAT/$107.73/Outperform
  • 20120416 “Be Conservative, Not Conventional”
  • 20120409 “Pigs and Panics!”
    • Harry D. Schultz identified the seven phases odf a typical market cyclce: 1) shortages, 2) the development of a concept, 3) profitable production, 4) overproduction and oversupply leading to losses, 5) losses, 6) cutbacks in production, 7) shortage and the start of a whole new cycle.
    • Over the years Wall Street has also had a series of pig-to-panic cycles: bowling alleys, color TVs, conglomerates, Alaskan oil stocks, double knits, air pollution, CB radios, mobile phones, soft
      contact lenses, Wankel engines, one-decision growth stocks, gambling casinos, Internet insanity, eyeballs per minute valuations, and most recently social media stocks.
    • last week the entire stuff-stock complex cratered.
    • The implication is that the downside should be somewhat contained, but the SPX is also not likely to break out above 1425 without spending some more time consolidating.
  • 20120402 “Shrugging Off Bad News!”
    • Thus, investors should be prepared for further policies designed to stimulate the economy, which should allow stocks to travel higher even if they do pause, or stumble, in the near-term on concerns the fundamentals are turning squirrelly.
    • in the short/intermediate-term there is not a linear relationship between the fundamentals and the stock market’s directionality.
    • Accordingly, my sense is that the equity markets need another few weeks of convalescing, probably in a range between 1385 and 1420 basis the S&P 500 (SPX/1408.47), before they are ready to re-rally. Still, as long as the SPX resides above 1385 the bullish case remains intact.
    • Expects sideways consolidation into a new rally.

March

  • 20120326 “Patience”
    • This has only been a pause with an upward bias, which is still bullish action.
    • This is why I have been consistent with the statement, “You can get cautious, but do not get bearish!”
    • it looks to me as if the U.S. dollar is in the process of breaking down. If true, and only for a trade, the Market Vector Gold Miners’ (GDX/$49.76) 16.3% mini-crash since February 29th should be over. A good stop-loss point would be slightly below last week’s intraday low of $48.45.
  • 20120319 “Lose Cash”
    • watch the KBW Banking Index (BKX/49.53) for the overall stock market’s near-term direction because the Financials have been leading this year’s charge.
  • 20120312 “The Ambergris Factor!”
  • 20120305 “Street Smarts”
    • One suggestion this week:
      • Vocus (VOCS/$13.52/Strong Buy

February

  • 20120229 Fun, Fun, Fun
    • He reiterates the reasons for his optimism that the US (and global) recovery will be stronger than the prevalent pessimism allows for.
    • He is cautious, but not bearish, featuring more conservative, dividend-paying, stocks:
      • Abbott Labs (ABT/$56.36/Outperform);
      • AFLAC (AFL/$48.01/Outperform);
      • Chevron (CVX/$106.66/Strong Buy);
      • McDonald’s (MCD/$99.99/Outperform);
      • Norfolk Southern (NSC/$68.81/Strong Buy);
      • CenturyLink (CTL/$39.26/Strong Buy);
      • Huntington Bancshares (HBAN/$6.09/Strong Buy).
  • He reiterates the reasons for his optimism that the US (and global) recovery will be stronger than the prevalent pessimism allows for.
  • He is cautious, but not bearish, featuring more conservative, dividend-paying, stocks:
    • Abbott Labs (ABT/$56.36/Outperform);
    • AFLAC (AFL/$48.01/Outperform);
    • Chevron (CVX/$106.66/Strong Buy);
    • McDonald’s (MCD/$99.99/Outperform);
    • Norfolk Southern (NSC/$68.81/Strong Buy);
    • CenturyLink (CTL/$39.26/Strong Buy);
    • Huntington Bancshares (HBAN/$6.09/Strong Buy).
  • 20120213 “The system will hold together…”
  • 20120206 Compelling Valuation, or Value Trap?

January

Truth or Consequences?”

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