Joined Jan 1, 1970
1,010 Blog Posts

Bank Time?

The XLF has has been creeping it’s way up and is now above the 20-day MA.  If it can overtake the 50-day, the XLF could be off to the races.  For the market to maintain these lofty levels and advance higher, I believe the financials need to rally.

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May Seasonality

Going down the list a bit, I like the look of the MAT chart.  The toymaker has a $9B market cap with a large sample of seasonality back-testing.

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After completing the purchase of Redbox in February 2009, earnings at Coinstar have been growing at an impressive clip.  The stock (CSTR) trades at a very reasonable multiple, with $275m in EBIDTA and a market cap of $1.55b.  For their Coinstar machines, they recently have implemented free coin counting if you redeem your cash in the form of a gift card from a retailer like Amazon.com, or if you donate the money to charity.  Before investing in CSTR, I want to see them continue to bring new innovations in the automated retail business.  Innovation, along with another couple quarters of steady earnings growth, will make the stock more attractive.  The chart doesn’t look great now, but CSTR is worth tracking for a suitable entry point.

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Come to me Google!

As a Google investor it is hard to view the 7% sell off this morning as a positive thing, but from a long term perspective it really isn’t so bad.  In Larry Page’s first earnings call since returning as CEO, he basically told Wall Street, “fuck off, I got this”.  Larry is investing in the future of the company, and rising expenses from this activity made for a lackluster quarter.  From a long term perspective, if GOOG is a large core position, the dip in share price can be viewed as an opportunity to build a larger position for a good price.

Google is a company that will grow exponentially with the proliferation of cheap computers, tablets, and phones.  The global internet pie is still growing dramatically, and Google is well positioned in sweet delicious core.  They have the best search engine on the planet, and perhaps the best email service as well.

Android is Google’s latest weapon, and it proven to be a very solid competitor to the iPhone, and is basically killing Nokia and Blackberry.  While Android itself is not a huge moneymaker for the company, it does wonders for maintaining market share as the internet pie spreads more and more to smart phones.  Disruptive products like Android and Google Docs give consumers great products for free, because Google is a pimp and they know people will use their awesomely powerful  search engine and services.

I am using todays decline in share price to add to my super long-term Google position, so that 5 years from now I will be as rich as an astronaut.  Check out this PPT screen of IIP’s, and compare GOOG’s earnings ratios and cash to the other large internet pikers.

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