The Stingy News Weekly (02/09/03)
The Markets This Week
DOW 30: 7,864 -2.36% with a median P/E of 19.9
S&P/TSX: 6,478 -1.39% with a median P/E of 21.9
The Value View
Dow at a P/E of 20: 7,904 (+0.5%) Poor Value
Dow at a P/E of 15: 5,928 (-24.6%) Fair Value
Dow at a P/E of 10: 3,952 (-49.75%) Good Value
S&P/TSX at a P/E of 20: 5,916 (-8.7%) Poor Value
S&P/TSX at a P/E of 15: 4,437 (-31.5%) Fair Value
S&P/TSX at a P/E of 10: 2,958 (-54.3%) Good Value
The dire state of the States
"For a couple of weeks late last year and early in 2003, investors were able to look past all the signs of economic weakness and see a light at the end of the tunnel. Sure, consumers were flagging and corporations retrenching. But once Iraq was over with (assuming a quick and not-too-dirty fight), the theory was that federal stimulus would kick in, chief executives would dust off their capital-spending plans, and Corporate America as well as individuals would suddenly feel better about investing in the future. That was the idea, anyway."
Pension threat to blue chip credit ratings
"Ten of Europe's biggest companies have been threatened with credit rating downgrades because of shortfalls in their pension funds"
Time to end "friends-and-family" shares
"IPO shares earmarked for a favored few hurt their issuers and other stockholders. Washington can make sure this doesn't happen."
The looting of Kmart
"Some companies never learn. Despite billions in losses, tens of thousands of layoffs, and an internal investigation that turned up evidence of accounting abuses and "grossly derelict" behavior by former managers, top executives at bankrupt Kmart are still enjoying blue-light specials while the company's future grows ever dimmer."
Bristol-Myers cleans up its mess
"Down 50% after an overdose of bad news and scandal, this drugmaker's stock is healthier than it looks."
Debt levels could leave us with hangover
"When central banks have attempted to regulate the supply of money, they have all too often failed."
Buying the wrong stock for the right reason
"We explore whether the Wall Street adage, 'Never catch a falling knife' is advice to be followed under all circumstances."
This week's trivia questions are: Q1. Who's first investment rule is to "Never lose money"? Q2. What is his second rule? Q3. What is the median debt to equity ratio of the S&P/TSX Composite? The answers to last week's trivia questions are: Q1. How many DOW stocks have an earnings yield of more than 5%? A1. 16 out of 30. Q2. How many S&P500 stocks have an earnings yield of more than 5% A2. 255 out of 500. Q3. How many S&P/TSX Composite stocks have an earnings yield of more than 5%? A3. 107 out of 228. Source: globeinvestor.com Symbol Search Can you find all the DOW stock symbols in the following text block? Repeat symbols are allowed, but diagonals are not. C M S P Y A S J K R A U D B X G R B Q L J W F P M V R M X W R N D V O W S H Z X R N G M S A G P U A V D I D X W F G W R D X S U Number of hidden symbols: 8 The solution to last week's symbol search in lower case S M U G B I D N V R Y O D X R V L M J Z k Y N R A e Y o e a b b S g S m Q g e a a F Z I O A U D x i b m U Q H E p U H E D N Q D Number of hidden symbols: 8 Symbols: ibm, ge, ge, mo, ek, ba, ba & axp The Stingy StoreDownload a sample of the Rothery Report Download a sample of Frugal Funds Subscribe Today Bullishly Yours, Norman Rothery ISSN 1499-2795 To (un)subscribe please use our email centre at http://www.stingyinvestor.com/cgi-bin/email.cgi Refer to legal & conflict of interest disclaimers at http://www.stingyinvestor.com/SI/legal.shtml http://www.stingyinvestor.com/SI/legal/conflict.shtml
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