Glen Doth Know

For those of you who passed simple math, 2+2=4

For those of you who understand a successful merger/acquisition, the goal is the combination of the two companies to yield more than their separate parts, essentially 2+2=5

Anyway, what you saw in Wells Fargo is going to happen over the next 5 weeks to the entire banking sector as well. If you cut the rate at which banks borrow to finance their loans, that increases their profit margin. Expect either a blockbuster quarter or a write off, but the blockbuster is more likely in my opinion.

Get ready to either be positioned in these stocks or miss the boat.

Tuesday: Goldman Sachs

Thursday: JPMorgan Chase

Friday: Citigroup reports

Where is the play? FAS. Further, I like Citigroup over JPM and GS, cause --- it has the most upside.

If I owned AIG, I'd sell out at $5 if it ever gets that high. The old CEO laughed at management's decisions since he left, go figure. Pass the blame.

If you're into insurance, GNW, PNX, and CNO are the ones I'm riding.

Labels: AIG, C, CNO, FAS, GNW, GS, JPM, PNX

Dario,

Yahoo is priced to grow at 11.5% by my calculations. I know they have had deals with Microsoft and Google and neither have worked as far as I know. It’s been growing revenues at 6% to 8% and earnings growth is also questionable. Everyone knows google’s a better search engine. I’d rather own the best in class. There is a PE ratio discrepancy of about 22 to 19. That’s no question. Unless you know about some deal that Yahoo’s got up it’s sleave. Owning it and not google at this point in time is in my opinion like paying the same price for a moped when you could get a BMW. But, hell, if gas mileage turns you on. Go for it.

I don’t know anything about banks. I figure, I’d rather not try and read financial statements that are produced by banks (the institutions that in my opinion can manipulate them the most). JPM has a PE of about 18. It’s priced to grow at 11%. I have no idea. Well, finally: “(JPM) has just announced it will be making changes to about $110 billion in mortgages to help its borrowers” That’s good news.

I have other companies that I’d rather own. 1 Year targets are stupid, but analysts set them. There’s all sorts of bad measurements out there. That said, I reference them each time before I buy.

All things considered, I don’t own either.

Glen

From: Dario Visnjic
Sent: Friday, October 31, 2008 2:39 PM
To: gbradfor
Subject: Stocks

Hey

I have some shares of JPM, and yahoo is showing that its 1-Year Target is like 46. Does that mean I should sell at $46 or what. Also when do you think I should sell JPM?

Thanks

Labels: JPM, YHOO