Posts Tagged ‘Stocks’
The Most Undervalued Stocks in the World
If you think the “lost decade” of stock returns seen in the United States since 2000 is bad, you probably haven’t been paying attention to Japan.
Japan’s stock market officially peaked on December 29, 1989, and has yet to recover more than 20 years later. But many companies in the country have continued to do well despite the suffering of the overall stock market. Japanese stocks used to be expensive, with the average stock trading for a price-to-earnings (P/E) ratio of nearly 50 at the market peak in 1989, and an eye-popping 70 as the bursting of the bubble hit earnings in the mid-1990s. Valuations have declined since, and are now trading for an average P/E of 15.6.
Japanese stocks have fallen to levels only seen a couple of times since its market peaked. The market fell to more reasonable levels earlier this decade and perked up during the apex of the financial crisis on optimism that Japan was “decoupling” with the United States. But the Japanese market has again fallen back to earth. This makes Japan one of the most appealing stock markets in the world.
[More from Ryan Fuhrmann: "5 Stocks That Could Win in the Digital Age" ]
A key reason for this appeal is Japan’s economy is geared toward exporting. Unfortunately, the strong yen has hurt sales by making Japanese goods and services more expensive to foreign markets. However, this is just a near-term blip and a number of Japanese firms that are global leaders are likely to continue growing robustly over the long haul. Going forward, the yen should come back down and make Japanese exports more competitive. Over the long run, currency fluctuations tend to cancel out, and Japan will stand out for supplying a growing world economy with automobiles, industrial components, apparel, and related goods and services.
Here are five appealing ways to gain exposure to Japan right now.
1. Toyota Motor Corp. (NYSE: TM)
Business: Auto manufacturing
Current P/E: 19.5
Toyota is well known to U.S.-based investors. The most recent global recession hit car sales badly and the company also got itself mixed up in a high-profile recall of thousands of cars over allegations of sticking accelerators, which damaged its reputation as a top-quality manufacturer. As a result, sales were hit rather significantly and earnings have cratered, but both are in recovery mode, making Toyota a definite rebound play.
Sales for 2011 are projected to rise more than 15% and reach more than $236 billion. Earnings could hit more than $4 a share in a year or two. To indicate the earnings recovery potential, note that earnings reached nearly $13 a share back in 2007, before the economy and product quality issues torpedoed the bottom line.
2. Fast Retailing (OTC: FRCOY)
Business: Retail
Current P/E: 21
Fast Retailing is an undisputed growth company that is blanketing the world with its popular UNIQLO clothing stores. It operates a number of other retail concepts — including the Cabin brand in Japan and the Theory brand in both Japan and the United States — and competes on a global scale with stores throughout the United States, Europe and Asia. The company has ambitious plans to open more than 1,000 stores in China in the next decade and plans to grow into one of the largest apparel retailers on the planet. Fast Retailing has a reputation for selling fashionable clothing at very low prices and therefore appeals to a vast market of cost-conscious consumers.
Financial details are a bit more difficult to find, given the company only issues financial statements in Japan. Sales have grown more than 16% in each of the past five years and profits are up almost 13% annually during this period. Returns on equity are very high and hit nearly 23% in 2010. At a P/E of close to 21, the valuation may not fit the profile of bargain stock, but given the growth profile, rising earnings should easily offset the fact that the multiple is above-average. In other words, a couple of years of rapid earnings growth will lower the P/E, and the stock will follow fundamental improvements over the long haul. Fast Retailing could be worth paying up for given its robust growth outlook.
3. Nippon Telegraph and Telephone Corp. (NYSE: NTT)
Business: Telecom
P/E : 10
NTT is Japan’s dominant phone company and controls about half of the Japanese market. Given the firm’s fixed-line focus, sales growth has been modest in recent years, but profits have grown steadily at more than 7% each year in the past decade. Weak core growth has been easily supplemented by its 57% stake in NTT DoCoMo, NTT’s wireless subsidiary.
In other words, investing in NTT is similar to investing in AT&T (NYSE: T) or Verizon (NYSE: VZ) stateside. The firm’s stated dividend yield is a bit more modest at just over 3%, but the P/E ratio is very modest at less than 10, which means the company doesn’t have to grow much to earn returns for shareholders. Earnings are likely to continue to improve because of cost-cutting measures and growth at DoCoMo. In addition, there is downside protection, given the firm dominates its market.
4. NTT DoCoMo Inc. (NYSE: DCM)
Business: Telecom
P/E ratio: 12
Investors with more of a growth bias may just prefer holding shares of NTT DoCoMo instead of its stodgier parent. DoCoMo also controls about half of the Japanese wireless market. It was the first company in the world to roll out a 3G network, but has since fallen behind by failing to introduce a 4G network fast enough. It appears to be getting its mojo back with the launch of the next generation of wireless technology. Profits are already high, and a return to sales growth could bring life back into the stock. The P/E ratio is quite reasonable at less than 12, and the stated dividend yield of 3.5% is also above average.
5. A general bet on Japan Inc.
Rather than ferreting out individual stock opportunities, investors may prefer to bet on Japan overall, given it has many large firms that successfully compete on a global scale. The MSCI Japan Index Fund (NYSE: EWJ) exchange-traded fund (ETF) is among the best passive approaches, as it provides a low fee way to gain exposure to Japan’s leading companies. Toyota is the top holding, along with a few financial players among the top 10.
Fidelity offers a number of actively-managed options, including Fidelity Japan (Nasdaq: FJPNX) and Fidelity Japan Smaller Cos. (Nasdaq: FJSCX). Both have performed firmly ahead of their benchmarks during the past five years.
Action to Take —> When investing internationally, it generally pays to go with the largest players that operate on a global scale. In terms of Japanese stocks in particular, there are plenty of options and the country has appeal given the stock market is offering some of the most attractive valuations of the past 20 years. If allowed only one choice, my money would be on Toyota, because it has a couple of key ways to boost earnings and will continue to grow briskly in the largest markets in the world.
Questrade no-fee RSP now comes with 10 free trades
Hello my dear fellow Canadians. I just got word from my stock broker – Questrade – that their no-fee RSP now gives you 10 free trades if you open an account by March 1′st. I just thought I’d let you all know in case you’re looking for a no-fee RSP account.
To find out more details see the Questrade homepage.
Like I said this is a limited time offer.
Wishing you the best.
Alan
Earnings Drive Stock Prices? See This Chart Before You Answer
By Elliott Wave International
Since the time of buttonwood trees, Wall Street has had its own version of the Ten Commandments — the cornerstone principles of conventional economic wisdom. The first of these writ-in-stone notions is the widespread belief that earnings drive the stock market.
By this line of reasoning, knowing where a market’s prices will trend next is simply a matter of knowing how the companies that comprise said market are expected to perform. On this, the recent news items below capture the public’s devoted following of earnings data:
- “Stocks Rebound As Investors Await Earnings.” (Associated Press)
- “US Stocks Drop As Earnings Data Fall Short” (MarketWatch)
- “Sideways Market Looks For Direction: Earnings Could Point The Way” (MarketWatch)
In reality, though, much of this belief is based on faith, not facts. While earnings may play a role in the price of an individual stock, the stock market as a whole marches to a different drummer.
You get this ground-breaking revelation in the FREE report from Club Elliott Wave International (Club EWI, for short) titled “Market Myths Exposed.” In Chapter One, our editors shatter the smoke-screen surrounding the widespread notion that “Earnings Drive Stock Prices” with these enlightening insights:
- “Quarterly earnings reports announce a company’s achievements from the previous quarter. Trying to predict futures prices movements based on what happened three months ago is akin to driving down the highway looking only in the rearview mirror. It leaves investors eating the markets dust when the trend changes.”
- And — There is no consistent correlation between upbeat earnings and an uptrend in stock prices; or vice a versa, downbeat earnings and a decline in stocks. Case in point: During the 1973-4 bear market, the S&P 500 plummeted 50% while S&P earnings rose every quarter over that period. Here, “Market Myths Exposed” provides the following, visual reinforcement: A chart of the S&P 500 versus S&P 500 Quarterly Earnings since 1998.
As you can see, the market enjoyed record quarterly earnings right alongside the historic, bear market turn in stocks in 2000. Then again, the first negative quarter ever in 2009 preceded the March 2009 bottom in stocks.
“Market Myths Exposed” dispels the top TEN fallacies of mainstream economic thought. The misconception that “Earnings Drive the Stock Market” is number one. The remaining nine are equally capable of knocking your socks off and most importantly, helping you protect your financial future.
Get the 33-page Market Myths Exposed eBook for FREE
Learn why you should think independently rather than relying on misleading investment commentary and advice that passes as common wisdom. Just like the myth that government intervention can stop a stock market crash, Market Myths Exposed uncovers other important myths about diversifying your portfolio, the safety of your bank deposits, earnings reports, inflation and deflation, and more! Protect your financial future and change the way you view your investments forever! Learn more, and get your free eBook here.
This article was syndicated by Elliott Wave International and was originally published under the headline Earnings Drive Stock Prices? See This Chart Before You Answer. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
Breaking news: Bernanke slams U.S. economy! What to do …
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A momentous event just occurred this afternoon:
For the first time in many years, the Chairman of the Federal Reserve went before Congress, set aside his rose-colored glasses, dispensed with most of his sugar-coated platitudes and made some hard-hitting statements about the U.S. economy.
Bernanke on jobs:
“This is the worst labor market since the Great Depression.”
Bernanke on housing:
“The market remains weak, with the overhang of vacant or foreclosed houses weighing on home prices and construction.”
Bernanke on fears about the future:
“Most … viewed uncertainty about the outlook for growth and unemployment as greater than normal, and the majority saw the risks to growth as weighted to the downside.”
Bernanke on tight credit for small businesses:
“Bank loans outstanding have continued to contract. Small businesses, which depend importantly on bank credit, have been particularly hard hit.”
And never forget: All this is coming from a man whose job invariably makes him extremely reluctant to admit to negative trends in any sector at any time — if Bernanke is saying things are bad, you can bet your bottom dollar they’re actually far worse.
Our recommendation:
- Act on our warnings to greatly reduce your exposure to the stock market, especially in the sectors we’ve been pinpointing as vulnerable to a double-dip recession: Housing and construction, retail, manufacturing, banking and more.
- Keep most of your money safely tucked away in short-term Treasury bills or equivalent. The return on your money (no matter how low) is not nearly as big of an issue as the return OF your money.
- To hedge against any threat to the purchasing power of your dollars, maintain a core position in gold — through bullion, a gold ETF or both.
- Above all, stay safe!
Good luck and God bless!
Complimentary ‘stock mastery training’
If you missed the deadline for Bill Poulos’s Market Mastery
Protege Program last night, I’m sorry, but you’re too late,
because enrollment is currently closed.
However, I have a bit of good news for you.
Bill just gave me a fantastic 62 page trading report he calls:
“Market Mastery Profit Plans”
How Stock Market Insiders Profit in Today’s Economy
He’s giving this away to thank you for participating in his
Market Mastery Protege Program release.
In this report, Bill teaches you the 5 ‘recession proof’ trading
‘attack plans’ that you can use TODAY to enhance ANY trading
method at ANY time in ANY market…
You’ll also learn:
** The 4 “cornerstone components” Wall Street insiders have used
for decades to dramatically put the odds of success in their
favor, and how you can do it, too (page 25)…
** The 4 “emotion stabilizers”, inspired by Einstein, that
finally help keep “fear & greed” out of the picture once & for
all (page 55)…
** How to drastically reduce your “time in the trenches” trading
stocks by spending only 20 minutes a day. This discovery makes
it all possible (page 56)…
** …and a whole lot more, as he reveals the critical & crucial
strategies you need to maximize your profit potential in these
volatile markets…
It’s entirely complimentary & “on the house”. No name or email
required to get it.
Here’s the direct access link:
http://www.marketmastery.com/z/?i=773362&l=f56
Enjoy!
Good Trading,
Alan
Stock Market Mastery Protege Program closes today!
OK.
This is it.
The enrollment page for 35+ year trading veteran Bill Poulos’s
Market Mastery Protege Program closes TODAY, Tuesday, at 11:59pm
Eastern (New York time).
If you get this message in time, you can probably still get in
here:
http://www.marketmastery.com/z/?i=773362&l=f55
As a final reminder, remember that:
* You get the entire Market Mastery Protege Program home study
course that reveals how to spot the 4 “profit pockets” that can
occur on almost ANY stock chart, again & again…
* You get 8 bonus group coaching sessions, which have sold in
the past for $5,000…
* You have 60 days to try out the course. Don’t like it? Send it
back. No questions asked…
* It all breaks down to about $2.74 per day…
If you’re ready to become an independent master trader, join get
in here today:
http://www.marketmastery.com/z/?i=773362&l=f55
Good Trading,
Alan
p.s. As of this writing, Bill’s real-time inventory counter
shows 14 copies remaining.
Stock Market Mastery Protege Program Ends Tomorrow!
Bill Poulos has decided to close enrollment into his Market
Mastery Protege Program TOMORROW, Tuesday, June 22nd, at 11:59pm
Eastern (New York time).
So if you want “in”, hurry and reserve your copy here:
http://www.marketmastery.com/z/?i=773362&l=f49
He even put up a countdown timer on the enrollment page so
you know exactly when it closes.
If you’re “on the fence” about joining Bill as a new student of
his Market Mastery Protege Program, here are some things to keep
in mind:
* The home study course reveals everything you need to know to
spot the 4 “profit pockets” that can occur on almost ANY stock
chart, including:
- The Profit Pipeline Method…
- The Trend Validator Method…
- The Velocity Method…
- The Countertrend Cash Method…
* If you enroll TODAY, you get 8 bonus group coaching sessions,
which have sold in the past for as much as $5,000. This is a
HUGE bonus, and frankly, it’s unheard of.
* The whole thing breaks down to about $2.73 per day over a
year. I think that’s the best deal you’re EVER going to find for
this much handholding in the markets.
* Finally, if you truly don’t think this is for you, Bill is
giving you a full 60 days to take it for a “test drive”. Don’t
like it? Send it back. Simple!
If you’re reading this message in time, you might still be able
to join him here:
http://www.marketmastery.com/z/?i=773362&l=f49
Good luck and Good Trading,
Alan
p.s. If you see a “Sorry, Sold Out” message, then you were too
late. Just add your name to the waiting list & you’ll be
notified if the program is ever released again.
More “Market Mastery” insights revealed (new video)
UPDATE: Bill Poulos just posted a brand new live interview video
he did with his son, Greg, where he answers the top questions
about his Market Mastery program that he received during his 3
training sessions last week.
He reveals some pretty interesting stuff.
You can watch it here:
http://www.marketmastery.com/z/?i=773362&l=f54
Good Trading,
Alan
p.s. Remember, Bill’s closing his Market Mastery enrollment page
this Tuesday at 11:59pm Eastern (New York time), so if you have
any interest in discovering how to spot the 4 “profit pockets”
that can occur on almost ANY stock chart, be sure to check out
his new video here:
‘Market Mastery’ trading indicators revealed
Attention dear fellow traders,
This is interesting…
Bill Poulos just released another new trade video that shows his
Market Mastery program in action yet again, but this time on
NVDA, racking up some nice profit potential in June on a sweet
short trade:
* 10 percent on the first half…
* 8 percent on the second half…
…all in a handful of days, in just 20 minutes or less a night.
NICE.
** Pay attention when you watch this quick 3 minute, 46 minute
trading lesson because you’ll see the indicators that he uses,
which I don’t believe he’s ever published before outside his
“inner circle” of students.
See it here:
http://www.marketmastery.com/z/?i=773362&l=f53
Enjoy!
Good Trading,
Alan
Market Mastery Protege Program home study course 85% discount?!
Bill Poulos just released another new video today that shows
exactly “what’s in the box” when you grab one of the remaining
copies of his Market Mastery Protege Program home study
course…
-but this time you get to see his computer genius son, Greg,
walk you through the course contents.
BTW, this is one of the reasons I get behind all the training
released by Bill. I’ve watched his training company grow from
its start all the way back in 2001 to a professional
organization that works tirelessly to take care of its students.
And while Bill now has many full time staff members working for
him, his company is still very much a “father & son” operation,
so they don’t lose sight of what’s really important — your
potential success in the markets!
ALSO, and this is a “biggie”… Bill didn’t mention anything
about this yet, but I wanted to bring it up because I think it’s
important: He’s essentially giving you “half off” the regular
enrollment fee for his Market Mastery home study course during
this limited release…
-PLUS, he’s throwing in 8 weeks of group coaching “on the house”
which used to cost 5,000 bucks… So, if you do the math, you’re
getting about 7,000 dollars of value for about $2.74 per day
spread out over a year…
(That’s like an unheard of 85 percent discount!)
-all backed by his “no questions asked” 60 day guarante e…
-and it all goes away next Tuesday, June 22nd.
Now, I don’t know about you, but that sounds like the “deal of
the decade” to me, and I think the only reason you WOULDN’T want
to grab a copy of Bill’s Market Mastery course at this point is
if you’re already raking in more money from the markets than you
know what to do with.
So, go ahead and watch the “what’s in the box” video here:
http://www.marketmastery.com/z/?i=773362&l=f52
-and then follow the link on that page to reserve your copy of
Market Mastery TODAY.
(Your portfolio will thank you for it later 
)
Good Trading,
Alan
p.s. Bill also just released these real attendee comments from
the end of his last live group coaching sessions he held for
another one of his training courses. As you can see, his
students are pretty darn happy:
[18:05]-Raymond Y.:Your method is eons ahead of competitors!
Thank’s Bill. I am so lucky to have bumped into you. You’re the
real McCoy!
[18:28]-tom e.:thanks a lot Bill, i learnt a huge amount today.
Look forward to putting this into practice.
[18:30]-Stephen S.:thank you for all the help!
[18:34]-Andrea M.:Thank you Bill!
[18:34]-Jenny S.:Thank you. Gradually getting the ‘hang’ of it
[18:34]-shankar r.:THANKS
[18:34]-Ralph P.:today was exactly what I was trading on thanks
[18:35]-Raymond Y.:Your the perfect example of the quintecential
WI NNER!
[18:35]-Gladys M.:Thank you for the coaching sessions. It’s been
a great help.
[18:35]-peter r.:THANX BILL
[18:35]-Sharon F.:Thank you Bill! I have learned tons!
[18:35]-Moises B.:thank you Bill. Very good
[18:35]-Fang H.:Thank you
[18:35]-Helmut R.:Thanks a lot
[18:35]-Paul S.:Thanks a million Bill
[18:36]-Roslyn d.:Thank you Bill, great to have these live
refresher classes
