Jeffrey Saut – 2014

  • Short-term:
    • up
  • Medium-term:
    • up despite traditional Sept. weakness.
  • Long-term:
    • Primary trend is a DOW theory bull market and the 4th major breakout in a century. (see June 2013 gleanings)

September

  • 20140922 “Sisyphus Succeeds!”
  • 20140916 Raymond James Gleanings
  • 20140915 “Then and Now”
    • Stocks fundamentally positioned for growth:
      • Apple has the most desired digital ecosystem in the world and it trades at a discount in comparison to its peers, the market, and its intrinsic value on virtually every metric.
      • Bank of America represents a proxy on an improving domestic economy and a company that still has vast room for operational improvement. BAC remains cheap at 0.7x book value (1.1x tangible book value).
      • Facebook is the backbone of the social media experience for more than one billion connected users around the world and provides the means for marketers to reach these potential customers with more efficiency and precision than has ever been possible.
  • 20140908 “Calm Down 2”
  • 20140902 “Homesick”
    • given an improving real estate market (I agree), and my views on a healthy automobile market, it seems remote that the U.S. economy will slide back into a soft economic spot.
    • Recommendations:
      • Starwood Hotels & Resorts Worldwide (HOT/$84.54/Outperform)
      • Mohawk Industries (MHK/$146.02/ Outperform).

August

  • 20140825 “Being Right or Making Money?”
    • “Are we in a buying stampede?” Recall “buying stampedes” tend to last 17 to 25 sessions, with only one- to three-session pauses/pullbacks before they exhaust themselves on the upside.
    • Stock pickers at the Bank of Montreal, however, are betting on improving growth in the U.S., and a decline in the euro currency, which should be bullish for U.S. equities. I agree and continue to believe we are in a secular bull market that has years left to run.
  • 20140818 “Lucid Dreaming!”
    • a sustainable low happened on August 7th. He subsequent action will be on the upside.
    • A decisive breakout above 1950 would suggest at least a test of the all-time highs and likely more.
    • We offer them for consideration:
      • Advance Auto Parts (AAP/$131.47/Strong Buy),
      • AmerisourceBergen (ABC/$76.33/Outperform),
      • Monolithic Power (MPWR/$44.06/Outperform),
      • Skyworks (SWKS/$54.39/Strong Buy), and
      • UnitedHealth (UNH/$81.47/Strong Buy).
  • 20140811 “A New York State of Mind”
    • We may be at the bottom of a short correction but be patient.
    • we will not be out of the woods until the SPX surmounts the 1940 – 1950 overhead resistance zone.
    • Recommendations:
      • Concho Resources (CXO/$133.33/Outperform).
      • Starwood (HOT/$79.66/Outperform).
      • Iridium Communications (IRDM/$8.22/Strong Buy).
  • 20140804 “Always Wrong?!”
    • “The equity markets do not care about the absolutes of good or bad, but only if things are getting better or worse.” I think things are getting better, and would note that while “easy money” has certainly helped, if next year’s earnings estimates are anywhere near the mark, earnings will have almost tripled since 2008.
    • Iridium (IRDM/$8.24/Strong Buy)

July

  • 20140728 “Trains and Boats and Planes?”
    • Railroad and airline recommendations:
      • Kansas City Southern (KSU/$114.25/Outperform)
      • Strong Buy-rated Genesse & Wyoming (GWR/$102.28)
      • Thus, we reiterate our Outperform ratings on AAL, ALK, ALGT, DAL, SAVE, and UAL.
    • Also:
      • Amerisource Bergen (ABC/$76.79/Outperform),
      • Manhattan Associates (MANH/$31.45/Outperform),
      • RF Micro (RFMD/$10.89/Strong Buy),
      • Skyworks (SWKS/$51.44/Strong Buy),
      • SBA Communications (SBAC/$103.22/Strong Buy), and
      • United Health (UNH/$84.68/Strong Buy).
  • 20140721 “How High is High?” (To Whom?)
    • When taken in concert with the other warning cracks, I continue to think if I am going to err here, I am going to err on the side of caution.
    • Last week’s intraday low was 1955.59. Accordingly, if those lows are violated, concurrent with a break below the 1940 – 1950 zone, the odds increase for a pullback greater than the mere 6E
    • Preferred: industrials, financials, info tech
    • Topping: health care, cons. disc., materials
  • 20140106 “I’m Back”
    • Recommendations:
      • Federal Express (FDX/$140.05/Strong Buy)
      • Danaher (DHR/$76.56);
      • Pall (PLL/$84.01);
      • Precision Castparts (PCP/$267.79);
      • Honeywell (HON/$90.52).
      • Valero Energy (VLO/$49.35/Strong Buy)
      • HollyFrontier (HFC/$49.36/Outperform); and
      • EOG Resources (EOG/$164.56/Outperform).
    • If I could script this week, I would look for another “treading water” session today (Monday) like we experienced last Friday. Then some kind of downside attempt mid-week to test the resolve of the bulls. If the bears can’t gather much traction on the downside, the rally should resume.
  • 20140103 Raymond James Equity Market Outlook 2014. Backdrop is the best since the credit crisis ended

    • Absent a recession (or inflation) triggering chain of
      events, we would expect pullbacks to not run beyond the mid-single digit to low double digit percentage areas.
    • Economic and market backdrops are positive.
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