The Stingy News Weekly (03/23/03)
The Markets This Week
DOW 30: 8,522 +8.42% with a median P/E of 21.8
S&P/TSX: 6,536 +3.66% with a median P/E of 21.1*
The Value View
Dow at a P/E of 20: 7,818 (-8.3%) Poor Value
Dow at a P/E of 15: 5,864 (-31.2%) Fair Value
Dow at a P/E of 10: 3,909 (-54.1%) Good Value
S&P/TSX at a P/E of 20: 6,195 (-5.2%) Poor Value
S&P/TSX at a P/E of 15: 4,646 (-28.9%) Fair Value
S&P/TSX at a P/E of 10: 3,098 (-52.6%) Good Value
Buffett now worth about $32.8 billion
"Warren Buffett may be ranked by Forbes magazine as the world's second-richest man, but he has received the same $100,000 annual salary since 1980."
Not a pretty picture
"Over time, art underperforms stocks. What's more, contrary to popular belief, the prices of art and stocks usually rise and fall in tandem, so there's no diversification value to holding part of your portfolio in art."
Boycott the French?
"Ah, the simplicity of demagogic populism, especially that of Bill O'Reilly and Stephen Moore. They haven't even bothered to notice that Dannon yogurt produces products in three U.S. plants (in Ohio, Texas, and Utah) and distributes them from five U.S. facilities (in Texas, California, Ohio, Florida, and Pennsylvania)."
The Wal-Mart of consumer finance?
"Kerry Killinger is trying to make Washington Mutual the "category killer" of retail banking. The competition, however, is heating up."
More pain for CEOs
"The top 15 chief executive earners netted an average of $35.8 million in 2002. That's down from the $135 million average in 2001."
"That's good news for Buhler, which has been profitable for much of the past three decades since millionaire John Buhler took over the company in 1969. CNH and Deere are still the giants of tractor manufacturing, but Buhler has plowed ahead by making high-powered, stripped-down tractors that lack bells and whistles (like global positioning systems or heated leather seats). While those snazzy features turn the cranks of some younger farmers, most crop growers just want solid equipment that will stand up to heavy use."
Some derivatives are scary
"It's the huge financial transactions that you don't see that worry a lot of people. Poor disclosure and lots of destructive capacity is a lethal combination."
The bond market is at risk
"PIMCO bond guru Bill Gross on the confluence of events that bode ill for the future and on how he's adjusting his strategy."
Buffett targets CEO pay as culprit
"Buffett said it was not realistic to expect CEOs to cut their own pay, but that lower executive compensation had better show up in company reports a year from now."
This week's trivia questions are: Q1. How many S&P/TSX Composite stocks managed to grow earnings-per-share by more than 10% annually over the last three years? Q2. How many S&P500 stocks managed to grow earnings-per-share by more than 10% annually over the last three years? Q3. How many DOW30 stocks managed to grow earnings-per-share by more than 10% annually over the last three years? The answers to last week's trivia questions are: Q1. How many S&P/TSX Composite stocks yield a return on assets of more than 10%? A1. 84 out of 227 (37%). Q2. How many S&P500 stocks yield a return on assets of more than 10%? A2. 120 out of 500 (24%). Q3. How many DOW30 stocks yield a return on assets of more than 10%? A3. 9 out of 30 (30%). Source: globeinvestor.comSymbol Search
Can you find all the DOW stock symbols in the following text block? Repeat symbols are allowed, but diagonals are not. U J U V Y N V M U J O O N G K J X J G U Q B E J N L S H Q P H I G E P Q P H Z F F K U F I Z E O Q N S F S R N U P Q J F J Q F V Number of hidden symbols: 6 The solution to last week's symbol search in lower case U k V O H q p h J o A F J K K m Q Z R F Z P S m E V G W F W X m I Y K L N I I H L U K F D g m J F F P Q B m K Q D Q Z c V R L A Number of hidden symbols: 6 Symbols: c, gm, gm, hpw, mmm, ko 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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