Stock Picks Bob's Advice
Wednesday, 6 August 2003
August 6, 2003 Zimmer Holdings, Inc. (ZMH)
The market started off lower, then the bulls stepped in...will it hold? Anyhow, all of these GREAT companies are showing up on our screens.
I do not own any shares of Zimmer but my wife owns I believe 8 shares that are the result of a spinoff of Zimmer from Bristol Myers Squibb. Currently, Zimmer is trading at $49.79 up $2.49 or 5.26% on the day.
According to CNN.Money, Zimmer Holdings, Inc. (ZMH) "...is engaged in the design, development, manufacturing and marketing of orthopaedic reconstructive implants and fracture management products, including artificial knees, hips and other joints."
On July 23, 2003, Zimmer reported (per NYTimes on the Web) 2nd quarter results: Net sales increased 19% (14% adjusted for currency fluctuations) to $411 million. Net earnings increased 35% to $89.0 million, and diluted earnings per share increased 32% to $.45 vs. $.34 in 2002.
Morningstar.com shows a beautiful series of bar graphs representing annual revenues increasing from $861 million in 1998, $939 million in 1999, $1.04 billion in 2000, $1.17 billion in 2001, $1.37 billion in 2002 and $1.44 billion in the trailing twelve months.
This corporation is spinning off lots of free cash: $203 million in 2000, $117 million 2001, $187 million in 2002, and $232 million in the trailing twelve months.
The assets and liabilities look nice too with $33.4 million of cash and $541.3 million of other current assets balanced by $342.7 million of current liabilities and $93.4 million of long-term liabilities.
This is a large company with a market cap of $9.29 billion with 196.5 million shares outstanding with 195.8 million of them that float. There is no dividend, there are 5.84 million shares out short representing 3.0% of the float and 4.19 days of average trading.
Overall, this company looks like an excellent investment quite worthy of your consideration. Perhaps a conservative investment based on its size but the bottom line looks excellent and it fits our criteria!
August 6, 2003 Pulte Homes (PHM)
I really don't WANT to post another home builder after getting by fingers burnt with the spike in interest rates....but there it is...Pulte Homes shows up on the largest percentage gainers. And what is a guy gonna do? I mean rules are rules and there is this homebuilder staring me in the face with all the great numbers that mean we should consider it. So we shall. Maybe the rebound on the homebuilders means that interest rates are temporarily too high...and shall be declining short term.
Pulte, a stock that I do not own any shares, "...is a holding company whose subsidiaries are engaged in homebuilding and financial services businesses." according to Cnn.money.
The stock currently is trading at $63.86 up $3.31 or 5.47% on the day. On July 24, 2003, Pulte reported their second quarter results: net income increased 35% to a record $122.0 million compared to $90.4 million for the same quarter last year. Earnings per diluted share were $1.95 representing a 34% increase over prior year earnings per diluted share of $1.45. Consolidated revenues were $2.0 billion, a 16% increase over prior year results of $1.7 billion.
Morningstar.com shows an equally pretty picture of revenue growth: $2.9 billion in 1998, $3.8 billion in 1999, $4.2 billion i 2000, $5.4 billion in 2001, $7.4 billion in 2002 and $7.6 billion in the trailing twelve months.
Unfortunately, there are no cash flow numbers posted on Pulte on Morningstar.com.
Pulte is fairly flush with cash with $868.7 million in cash, $4.6 billion of other current assets to offset $1.7 billion in current liabilities and $2.25 billion in long-term liabilities.
The company has a market cap of $3.7 billion with 61.1 million shares outstanding and 42.8 million of them that float. There is a small dividend of $.16/share (0.26%), the p/e is a downright dirt-cheap 7.61, and there are 2.28 million shares out short on this company representing only 2.60 days of trading.
I like the numbers of this homebuilder a lot. I just am a bit leary if that sector is a bit overdone...but the numbers cry out for attention!
Have a great Wednesday! Thanks for stopping by.
August 6, 2003 DRS Technologies, Inc. (DRS)
O.K. so I wasn't too excited about my last post. (Sunrise). This one I like a bit more and IS a stock that I own and have in my trading account.
DRS Technologies "...is a diversified, high-technology company serving government and commercial niche markets worldswide. The Company develops and manufactures a variety of systems and components used for the processing and storage of data." according to Cnn.money.
DRS is having a good day trading at $27.98 up $1.47 or 5.55% on the day. Like many of our recent posts, the stock jumped on news of its first quarter earnings that was reported yesterday, August 5, 2003.
Briefly, according to the NYTimes on the Web, Fiscal 2004 first quarter revenues were $167.2 million, a 27% increase over revenues of $131.2 million for last years first quarter. Operating income was $16.4 million representing a 29% higher income than the $12.7 million reported in 2003.
Net earnings were $7.3 million or $.32/diluted share an increase of 34% from last year's $5.4 million net income or an increase of 3% ver last year's $.31/share reported in 2003.
(Diluted shares outstanding were 30% higher at 22.9 million due to a 5.5 million share offering in 2003.
The Morningstar.com site: http://quicktake.morningstar.com/Stock/Financials.asp?Country=USA&Symbol=DRS&sktab=fiin&hsection=
shows a beautiful series of revenue reports from $180.8 million in 1998, $265.8 million in 1999, $391.5 million in 2000, $428 million in 2001, $517 million in 2002 and $676 million in 2003.
Free cash flow has been steady at $18 million in 2001, $14 million in 2002, and $30 million in 2003.
Assets and liabilities not quite as pretty but fairly well balanced with $95.9 million in cash on hand with $293.4 million in other current assets balanced by $289.3 million in current liabilities and $244.7 million in long-term liabilities.
The market cap is $595.3 million with 22.5 million shares outstanding with 22.2 million that float. No dividend is paid. The p/e is a reasonable 16.84 and there are 1.19 million shares out short representing 5.4% of float or 6.46 trading days based on an average day of 184,000 shares trading. (data per Yahoo as of 7/8/03).
Overall, for a defense contractor, this is a pretty picture and worth your consideration. It has already gotten my attention as I bought some shares earlier this year (see my trading account listed elsewhere on bobsadviceforstocks.tripod.com.
Regards to All!
August 6, 2003 Sunrise Senior Living, Inc. (SRZ)
Another bad day in the market. And today they are taking down the HMO's. We have a couple on our list and if you own any, remember to keep a tight 8% stop on your losses. In my trading account, I haven't hit any 8% loss limits with this correction but I am close on Zoran with about a 6.5% loss. Goes down a few more pennies and it will hit the stop.
Anyhow, without giving up all hope and optimism...we are back at work here. Sunrise Senior Living, Inc., is actually having a nice day and fits almost all of our criteria. Currently it is trading at $23.95 up $.62 on the day. They announced their second quarter earnings today and managed to support the stock price in an otherwise poor trading day.
Sunrise reported that second quarter earnings per share were $.67, a 43 percent increase over the same period in 2002. Revenues rose 179% to $334.5 million from $119.9 million in the same quarter last year.
Morningstar.com shows a history of steady revenue growth from $89.9 million in 1997, $171 million in 1998, $255 million in 1999, $345 million in 2000, $428 million in 2001 and $506 million in 2002.
Free cash flow has improved recently from an unimpressive $5 million in 2000, $3 million in 2001, ($1) million in 2002 and a positive $58 million in the trailing twelve months as reported on Morningstar.
The assets/liabilities picture is a little disturbing with $72.2 million in cash and $77.9 million in other current assets with $195.8 million in current liabilities and $534.3 million in long-term liabilities.
While most of the picture looks o.k., the heavy debt picture makes me a little unenthusiastic about this selection. If you need an investment in this arena, this might be a nice selection. Otherwise, like me, you might just wish to pass. Have a great Wednesday!
Monday, 4 August 2003
August 4, 2003 Atrion Corporation (ATRI)
Last one for the day! Atrion Corporation (ATRI). I have never even HEARD of this corporation before finding it on the list of greatest percentage gainers. Yet it does seem to fit the bill.
Needless to say, I do not own any shares of ATRI.
Atrion, according to CNN.Money "...is a holding company that designs, develops, manufactures, markets, sells and distributes medical products and components." ATRI had a nice day today, closing at $34.70 up $2.68 or 8.37% on the day.
On July 30, 2003, Atrion reported their second quarter results: revenues were up 9% and earnings per share from continuing operations were up 29% compared to the second quarter of 2002.
Morningstar.com shows a steady growth in revenue from $43.4 million in 1998, $49.9 million in 1999, $51.4 million in 2000, $57.6 million in 2001 and $59.5 million in 2002.
Free Cash flow has gradually improved from $4 million in 2000, to $6 million in 2001 and $7 million in 2002.
The Balance Sheet on Morningstar shows only a little cash at $700,000 with $21.8 million in other current assets balanced against $6.4 million of current liabilities and $11.2 million in long-term liabilities.
Atrion is a very small company with only a $53.4 million market cap with 1.67 million shares outstanding and 1.20 million that float! The p/e is a very reasonable 13.31. There are no shares reported out short as of 7/8/03.
This is an interesting situation. Numbers are good and the company is tiny. Sometimes with the small float, a little buying pressure can create tremendous upward price movement....then again, if something goes wrong, the average trading volume is 1,000 shares....and it may be harder to unload shares due to the limited liquidity of the stock.
Good luck! And thanks for stopping by! Drop me a line at firstname.lastname@example.org if you have any questions or comments.
August 4, 2003 Intier Automotive Inc. (IAIA)
Well the market is trying to rally today. Let's see if it holds the gain into the close...that could be bullish for trading tomorrow!
Came across this company today. I do not own any shares nor does anyone in my family of Intier Automotive (IAIA). Intier "...is a global full service supplier of automotive interior and closure components, systems & modules. IAIA directly supplies most of the major auto makers in the world." according to CNN.Money.
Intier is having a nice day today, probably in anticipation of earnings, trading at $16.50 up $1.50 or 9.99%.
Morningstar.com shows a nice record of revenue growth from $2.1 billion in 1997, $2.57 billion in 1998, $2.83 billion in 1999, $2.971 billion in 2000, $3.26 billion in 2001, $3.862 billion in 2002.
Intier announced first quarter 2003 results (latest reported quarter) on 5/7/03. At that time they reported that sales increased 17% to $1,031.6 million from $878.9 million in 2002. (currency exchange rates affected this positively by about $70 million).
Free cash flow has improved from a ($133) million in 2000 to a positive $79 million in 2001 and $179 million in 2002. Operating income increased to $30.1 million from $28.5 million for the first quarter of 2002.
Assets and liabilities are fairly well balanced with $241.3 million in cash and $874.9 million in other current assets vs $835.3 million in current liabilities and $302.5 million in long-term liabilities.
Yahoo.com shows that this Canada-based company has a market cap of $723.5 million with 48.2 million shares outstanding and only 4.70 million that float. The companies pays a $.40 dividend suggesting a 2.67% yield. The p/e is a reasonable 16.97, and there are no shares reported short as of 7/8/03.
If you would like something that is not high-tech, a bio-tech, or a financial, this might be a stock for you. I still remain concerned about the overall health of auto sales, so I am a bit slow to embrace this particular stock...but it deserves to be on our horizon. Thanks for stopping by!
August 4, 2003 Mylan Laboratories (MYL)
Another down day for the market! In the midst of this, Mylan shows up on our list. According to CNN.Money, MYL "...is engaged in the development, licensing, manufacturing and marketing of generic and proprietary finished pharmaceutical products." Sounds a little like LCI, and ELAB, which are some of our other stock picks that manufacture generics.
I do not own any shares of MYL nor does anyone in my family.
MYL is having a nice day in the market trading currently at $34.50 up $.95 or 2.83% on the day.
On July 23, 2003, MYL reported their first quarter results for the period ending June 30, 2003. During this period, net revenues increased 20% to $331.4 million from $275.5 million in 2002. Net earnings for the quarter increased 36% to $83.9 million from $61.8 million in the same period last year. On a per share basis, diluted earnings per share were $.46 vs. $.32 last year, an increase of 44%. However, first quarter results included gains on legal settlements amounting to $.08 of the $.12 increase from last year.
Morningstar.com shows a steady growth in revenue: $0.6 billion in 1998, $0.7 billion in 1999, $0.79 billion in 2000, $.84 billion in 2001, $1.1 billion in 2002.
Free cash flow has recently been outstanding with $89 million in 2000, dropping to $41 million in 2001, but increasing to $326 million in 2002. Morningstar reports that the trailing twelve months free cash flow has been $266 million.
The Balance Sheet on Morningstar look excellent: Cash on hand is reported at $708 million, way more than current liabilities of $262.7 million and $39.2 million in long-term liabilities combined. In addition, MYL has $517.3 million in other current assets.
Mylan has a sizeable market cap of $6 billion with 179.0 million shares outstanding and 170.3 million of those that float. The company DOES pay a small dividend yielding 0.40% ($.13/share) and trades at a reasonable p/e of 21.23. There are 2 million shares out short but due to the average trading volume of 1.46 million, this represents only 1.36 trading days.
This is a very nice stock to look at for consideration for investment. Thanks for stopping by and visiting...please feel to leave comments here or email me at email@example.com if you have any questions, comments, or what I love, words of encouragement!
Saturday, 2 August 2003
August 2, 2003 "How are we doing?" Looking back at week of 6/23/03
We had a up and down week during the period of 6/23/03 to 6/27/03. However during the week we made some stock selections. Five weeks isn't a lot of time to give an investment, but let's take a look at how these picks have done this past month. (That is what we USUALLY do on weekends around here!)
On June 23, 2003, we picked two stocks: FDCC at $19.18 and FDP at $26.14. Factual Data Corp. (FDCC) has dropped to $17.25 on Friday 8/1/03. FDCC is being acquired by Kroll and we will not be following this stock much longer. In fact, shortly after our selection, Kroll announced its acquisition plans at a below-market price! How about that for bad timing? Anyhow, at $17.25, this represents a $1.93 loss or 10.06% drop.
Fresh Del Monte Produce (FDP) closed Friday, 8/1/03, at $27.67. This is a $1.53 gain or a 5.85% move to the upside.
Biosite (BSTE) was selected when it was trading at $48.15 on 6/25/03. BSTE closed at $42.04 representing a loss of $6.09 or a 12.6% drop. Not too thrilling this first month!
Digital Insight (DGIN) was picked on 6/25/03 at $17.96. Friday, 8/1/03, DGIN closed at $19.86, a gain of $1.90 or a gain of 10.5%.
Bankrate (RATE) was selected on 6/25/03 while trading at $10.40. This probably is one of our best performers...which now may be under pressure due to interest rate concerns....but it still closed on Friday 8/1/03 at $14.39. This represents a nice gain of $3.99 or a gain of 38.3% for this time period.
Biovail (BVF) was picked on 6/26/03 at $49.30. The company unfortunately posted a loss on 7/29/03 due to acquisition costs and the stock price suffered accordingly. The stock closed Friday, 8/1/03 at $38.31 a loss of $10.99 or a drop of 22.3%.
Online Resource Corp (ORCC) was picked on 6/27/03 at $6.17. Currently, as of Friday, 8/1/03, ORCC closed at $5.27, a loss of $.90 or a drop of 17.1%.
CACI International (CAI) was the last pick for the week when it was trading at $34.27. This stock had a nice month and it closed at $39.23 on 8/1/03, a gain of $4.96 or a gain of 14.5%.
Overall for the week we had four stocks up with gains ranging from 5.85% to 38.3%, and four stocks down with losses ranging from (10.06%) to (22.3%). The average performance for the eight issues was a gain of .88%. Pretty much a wash for the month.
Thanks for stopping by and visit again soon. Would love to hear from more of you about the usefulness of this site and questions, comments, or words of encouragement! You can reach me by posting right on the site or emailing me at firstname.lastname@example.org
Friday, 1 August 2003
August 1, 2003 United Online, Inc. (UNTD)
O.K. how about one more before I call it for the evening? I am a big fan of cable modems and DSL and have not been very impressed with AOL and dial-up services but perhaps this company deserves a second look....
United Online, Inc. (UNTD), according to CNN.Money "...is an Internet Service Provider formed as the result of the merger of NetZero and Juno. The Company offers billable dial-up Internet access services in more than 5,000 cities for $9.95 per month."
United had a wonderful day today closing at $33.64 up $2.25 or 7.20% on the day. They reported their fourth quarter results yesterday (7/31/03) as reported on Yahoo.com: revenue for the quarter was $79.6 million up 46% from $54.4 million for the year ago quarter. Total pay subscribers increased by a net 142,000 during the quarter reaching a record 2.55 million. Excluding a one time tax benefit, net income was a record $10.3 million or $.23/share vs a loss of ($2.7) million or ($.07) per share for the year-ago quarter.
Morningstar.com shows a pretty picture of revenue growth starting with a miniscule $5 million in 1999, $55.5 million in 2000, $57.2 million in 2001, $167.5 million in 2002, and $168 million in 2002. The latest quarter earnings report also reported that 2003 revenue was $277.3 million.
Free cash flow has been improving and is now turning positive: ($104) million in 2000, ($103) million in 2001, ($6) million in 2002 and $53 million in the trailing twelve months.
The balance sheet is pristine with $171.5 million in cash reported with $18.9 million in other current assets. This can be compared to the liabilities picture with $62.8 million of current liabilities and NO long-term liabilities at all.
Per Yahoo.com, UNTD has a market cap of $1.32 billion with 42.1 million shares outstanding, while 37.8 million of those float. There is no dividend.
The p/e while steep at 138.24 represents a company that is just now turning profitable and should come down quickly if growth continues. As of July 8, 2003, there are 5.47 million shares out short, representing 4.63 days of trading for average volume days.
Overall, this company is very attractive with the only negative I could see is that it is a dial-up service...and the p/e is steep. However, with the company just now turning profitable, we can hope that earnings growth will quickly drop the p/e into reasonable territory. Otherwise, lots of cash on hand and an explosive growth story!
Have a great weekend friends! Thanks for stopping by.
Posted by bobsadviceforstocks at 6:02 PM CDT
Updated: Friday, 1 August 2003 6:03 PM CDT
August 1, 2003 Alliance Data Systems (ADS)
Quite a lousy day in the market today! Could feel it yesterday when the Dow sold off and today it followed through with continued selling. Even so, market has had a big run and needs a rest....wish it wasn't so!
Now that my day is done, I have a chance to run through the lists of stocks and see if anything looks nice for our pick list. I came across Alliance Data Systems which I think fits the bill (ADS). Alliance, according to CNN.money "...provides electronic transaction services, credit services and loyalty and database marketing services. The Company develops and executes programs designed to help its clients target, acquire & retain loyal customers."
ADS had a nice day today closing at $28.45 up $1.05 on the day or 3.83%. They reported their earnings on July 16, 2003, for the quarter ending June 30, 2003. At the same time, according to NYTimes on the web, they "...raised guidance for the full year."
By the way, I do not own any shares of this nor do any members of my family!
According to the NYTimes article, total second quarter revenue increased 20% to $247.6 million compared to $205.5 million in the same period a year ago. Net income increased 250% to $11.9 million or $.15/share compared to $3.4 million or $.04/share for second quarter of 2002.
The morningstar.com 5 year financial graph is equally impressive. Revenues have grown sequentially from $411 million in 1998, to $583 million in 1999, $678 million in 2000, $777 million in 2001, $871 million in 2002...and extrapolating the current quarter we should get near $1 billion for 2003.
Free cash flow has been improving from $54 million in 2000, $132 million in 2001, $85 million in 2002, and $206 million in the trailing twelve months.
Financial balance sheet not quite as pretty as the previous facts: $99.7 million in cash, $358.7 million in current assets and $492.2 million in current liabilities and $503.0 million in long-term liabilities. Morningstar.com reports $1.09 billion in long-term aseets. Lots of debt apparently but the cash flow is good and improving, so this hopefully shouldn't be a problem.
Yahoo.com shows a market cap of $2.16 Billion with 78.7 million shares outstanding and 62.2 million that float. The p/e is a steep 49.73 and there are only 966,000 shares out short representing 2.97 days of average volume.
The stock looks nice to me although debt is a bit steep imho, and the p/e is a bit rich. Otherwise the revenue growth and the latest earnings picture as well as the free cash flow generated is all attractive. May be worth your consideration and further investigation!
Thanks for stopping by. Be sure to drop me a line at email@example.com if you have any questions or comments.
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