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AMERICAN EXPRESS

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AXP is trading at $41.00 a share. Not since July 14th of 2003 has this stock traded so low. In 2003 American Express, the largest of all credit card companies in the world, had gross revenue of $18,235,000. Year ending 2007, $29,900,000. 1/3 or a 33% gain in gross income over 5 years. 1 year EPS gowth of +16.24% P/E (TTM) 12.6x, P/E (forward 12 months) 12.2x. EPS growth rate far exceeds the financial sector. Yet with great numbers, barely a red mark on the balence sheets, this stock continues to fall in price. Even if the US economy falls deep into recession it is doubtful that the Amierican Express's financials would fall to 2003 levels. American Express does not have the reputation of getting involved in the subprime credit expoeure but. like many credit card companies does offer a Gold card with a yearly fee to lower credit rated consumers. They also have the reputatrion of heavy debt collection activitys when they encounter customers that fall behind. As the card needs paid in full each month AXP stays on top of thier collections. Yet the price continues to drop. They don't back mortgages. They charge the highest business percentage of any card just to give a bussiness's custumers the convienence of using the card for thier purchases. Thier involved in business loans and lines of credit but still not in subprime applicants. The companies fudamentals are quite sound with a 12.8% net profit margin.They have completed the sale of the American Express Bank Ltd. to Standard Chartered PLC. this past Feb. Which should supply the company with a large cash stash. The American Express Travlers check is known, sold and excepted wordwide. The American Express Travel services are used worldwide by large and small business's. Yet the stock continues to fall. After the Bears, Strearns Bailout by the Federal Reserve the stock fell another $1.69. This month it has fell $5.00. Of all the financials this stock should enjoy a quick recovery. Maybe not the most but at least the most for sure. Ric B.

STOCK ANALYST"S - OVERWIEGHT OR UNDERWIEGHT

Rating: 1.00 (1 votes) Vote:

Should you be buying stocks on the advice of a professional stock analyst ? Can they be trusted ? Do they know what they are talking about ? Lets look into some of those questions and find some answers. The first thing about a stock analyst is that they are basicly giving advice. Since it is considered advice, that they should not be held financally responsable for you using thier advice. Thus is the reason after all or most recomendations is the forward statement clause. Now not all stock anlyst's are trying to get you to buy a bad stock, some do do due deligense in thier recomendations. Sorry for the pun could not pass that one up. For the most part that is what thier selling or in some instances giving to you, do do. Lets begin with what does all those terms mean. ie. Underwieght, Overwieght, Buy, Strong Buy. Ect., Ect....
The explanation is not as clear cut as it may seem. First off the analyst community wants you to understand that Sell or Buy recomendations do not mean to Sell or Buy the stock immediately to every invester. It means to Sell or Buy the stock if it fits your own unique perticular financial situation. Clear right ?. Well lets look at recomendations in groups to start with. Buy, Stong Buy, Market Outperform, Recomended list all fall into the positive recomendation list. Hold, Neutral, Market perform fall into the without growth list. Sell, Avoid, Market Underperform are the negative stock list's. We will begin with the positive recomendatrions. What does it mean, really to see a Buy or outperform recomdation ? To not get too technicial, it can mean that the stock, in presant market conditions wiill increase in stock price by 5 to 10 percent in the next 18 month period. The Hold or Nutral recomendation means that the stock will not increase or decrease by 5 to 10 percent in the next 18 months in the present market conditions. Of course then the Sell or Underperform recomendations mean that the stock will decrease by 5 to 10 percent in the next 18 months in the present market conditions. That sure leaves a lot of room for error. The Market rarely stays in the same conditions for 18 months and a 5 to 10 percent change in 18 months is not uncommon. As you can see by these guidlines a stock analyst is quite close to being a weatherman as far as accuracy is concerned. Now that we know the guidelines of the stock analyst, lets look at the driving force behind those recomendations Many analyst's work for Brokerage Companys, Institutional money managers, Finanacial Investment Firms and some work on thier own. You must know the reputation and the track record of the analyst before you use those recomendations. These things must be considered when using thier advise. You must also consider how the analyst makes his living. If they work for a brokerage firm, for example how the firm compensates the analyst may be directly related to how the firms portfolio performs. They may pay commissions on covered stocks and therefore have a vested interst in how certian stocks perform. That may also be true with Institutional Money Managers. Thier compensation is directly related to how well thier Mutual Fund performs. On the same hand they may not want to issue a Sell recomendation on a stock that is widely held by thier company or fund. In this case they may issue a market perform or hold recomendation to prevent losses in thier own fund or portfolio. Some analyst are compensated with stock from the recomended company in the event of an IPO. Then they also have a vested interest in the stock price. The company they work for, friends and themselfs may own significant numbers of a recomended stock and then also have an interst in the performance of a stocks price. In the end the anaylst community wants you to believe that they have the publics interests foremost in thier recomendations when in fact it may be someone else who may benifit from any peticular recomendation. Remember that it is your money, keep an eye on it. Nothing beats good sound research of a stock your interseted in. Good luck out there and watch for those falling knives, there everywhere. Ric Bottorf

Stop limit oders

Rating: 2.50 (2 votes) Vote:

Thursday evening I was going over the Market numbers and thought to myself, it looks like we could be in for another sell off. I quickly wrote a blog suggesting Mon.,Tues. or sooner that we could be in for a sell off and to use stop limits on your investments. I then went into my portfolios and sold everything on a stop limit .10 cents below the current price Thursday nite. Now you may ask how would you know there is going to be a sell off without sounding like there is a conspiracy. Well I don't know but I'll try. First off I was thinking the market has been too complacent. Yes there was volitity but there also was profit. I almost felt comfertable agian with my trades. I stop using limit orders, I felt I could leave money in the market overnite and still have it in the morning. Then on Thursday evening when I usually take a look at the new blogs and chart new stocks that are blogged about. Every stock I looked at was down after 2 days of being up. Sure it happens but every stock. I then started charting the markets Feb 7 thru Feb 28. when I realized I saw this same pattern before, right before the last sell off. Stock prices were at the same percentage above their 13 day price avg. as the last time. Almost all stocks had been in the green for 2 weeks with a couple days of small correction. On Thursday morning stock analyst were beginning to pump the dume & glume in print and on the air waves. Still the shortting was beginning to show some slow down. Everything looked as if things were going to get better but, it was not to be. Bad report after bad report began to flow, Then Friday morning stock prices dropped, bounced and started to fall, Then the numbers started to come in sell, sell, sell. As I watched the stock numbers sell off in real time it was unbelievable. Every stock in my portfolio sold off by 9:20. As I watched I thought where is MSFT price at. As I looked it was falling to $27.60 and it hung there about 10 minutes. I placed a limit order for $27.35. As I went back to the real time screen it started to drop so I tried to change my order to $27.20. In all of 10 seconds I was too late, my order was being filled right then for $27.35. I know >15 cents a share dosn't sound like much but I pride myself on buying bottom. As hard as it is to do it can be done with practice. Its funny how the market was tanking and all I could think of was what can I buy cheap. The reason I was free to not worry was Thursday nite as I said I put every stock I had on a limit sell order. The reason I did that was to keep my profits. I can't stress enough that as hard as it is to make a profit in this market it's so easy to lose it. If I think the market will tank I put a >10 cent limit order in place the nite before. If I intend to keep a stock long term I use my profit to determine my limit order. Or I use a .40 cent to .80 cent limit. If the stock fluctuates a $1.00 or more per day and I can't watch it I'll use what ever is nessacary to keep the stock but not lose my shirt. Because of stop limit sale orders I slept well and had money to buy a stock I felt was on sale.

SELL OFF, TUES & WED ? or sooner

Rating: 1.50 (2 votes) Vote:

The market showed signs of another sell off today with no good news to be reported anywhere.
Stop orders should be the action of the day. You should be protecting any profits you may be showing as a precautionary guide if nothing else. A stop order allows your broker to sell your stock if it drops below a predetermined price. I hope I am wrong but if not there are stop orders as some protection.The reasons for a sell off are too many to list but I'll give a few. Some analysts still beleve the sock market is over priced. The last of the baby boomers that did not pull thier retirment out of the market yet, will within days. The retirees that have money in the stock market yet will also pull out soon, very soon. Everyday investers have no reason to stay in.the market, unless you enjoy the frustration of earning very small profits with the chance of lossing it all sundenly is something you enjoy doing. Its been a relaxed market for about 8 to 10 days now. Just long enough to get comfertable. just long enough to get you to invest a little more thah usual. Then bam, Sell Off, but like I said with all the good news lately it might not happen.The present state of the econemy,cash is king. Even with the lower interest rates borrowed money is hard to come by. Institution buyers will be looking to cut losses as they rode out the last sell off and caught a lot of flack from investers. I don't think they will sit on thier hands this time. Of course there is the chance some good news could fall froim the sky. The FED has done about all they can do. They could buy out all the ajustable rate mortgages out there about to foreclose. Or send $1200 emergency checks out to everyone with a SS#. The trouble is they just can't fill the hole that falling house values are creating now. A home worth $200,000 financed @ 80% or $160000 is now worth $158000. Now that home can only be remotgaged @ $126400. Pity the fool that mortgaged @ 100 % or 110% like I saw advertised in 2005. Remember 2005, home prices will never go down and those ajustabvle mortgages won't rise, these are the lowert interest rates in a decade. Did you hear that story ? Of course thats not the only problem we have right now, thats reallly old news. Now we have high energy prices that seem to have no ceiling, unemployment benefits running out, no savings and no incentive to save. Declining sales in all sectors but gas and oil.This is nothing that is not on every news channel every day.Keep your eyes on the weather , one cold snap and oil will go crazy Its starting to seem like the only good news is about the war. I would love to recommend a stock right now but, in good conscience I can't. A few stocks I was watching off the rader fell $8 to $12 with good earnings for no reason. So watchout, good luck and Oh yea, don't forget stop orders. Ya know LDK looks like it could move up some more. (couldn't help it, theres always a few that are moving)
Good luck and oh yea, don't forget to use stops. Ric Bottorf

Rocket Stocks ? UPDATE

Rating: 1.00 (1 votes) Vote:

ADSK Wed. FEB. 20 BUY @ $37.80 Mon.25th close $39.30 +$1.50 & still climing

Wed. FEB. 20 Not yet, wait for bottom. could be awhile
WFMI I jumped the gun on this one but, as I said in the original blog wait for it to bottom

CECO Wed. FEB 20 UP $.38 Today Lost Faith OFF LIST Still has chance if credit woes lighten up but there are much better financial plays TANK THIS ONE

PDCO Wed. FEB. 20 BUY @ $33.50 Mon. 25th close $36.49 +$2.99 & still climing

I think these three will reach thier $5.00 gain Target
will UPDATE next week

ADSK

Rating: 2.00 (1 votes) Vote:

This stock was recommended to me by a professional stock analyst. I have been watching this stock for 8 months now. It was first a buy before the market sell off and more recently as the market began to bottom out. ADSK was a $50 + stock as early as Dec 2007. Since then it has tumbled to $38.60, no fault of the stock, basicly market conditions. Autodesk Inc. ADSK a solutions provider to the Architecture, Engineering and Constuction Industry. Also kown as A/E/C industry. Has aquired a division of ( NYSE) ARP American Reprographics Company located in the Atlanta area and will provide local offices in the South Eastern US and help provide CAD software to some 4000 orginizations in the soutern US. ADSK has also aquired the games software provider Kynogen. Both deals to be completed in the next 3 months. Marc Petit , Senior Vice President of Media and Entertianment said " The future of vidio games is about sophisticated game play,with more believable characters and enviorments. Our goal is to simplify vidio game development by creating cutting edge tools to create, animate, and intregrate 3D assets into game engines. The aquistion of Kynogon ia a key component in reaching that goal." Kynogon is a main supplier to the entire vidio game industry. They have partnered with almost every vidio game maker in the world. Has won many awards for thier expertise in the vidio game industry and are known world wide. In 2007 they also aquired Navisworks, and Plasso Tech, a supplier of analysis and simulation software for the mechanical design market. Also in Jan 2008 they completed the acquistrion of Hanna Strategies and Robobat.

The products avialiable through Autodesk are as the Vice President of Media and Entertianment said. They are cutting edge and quite pricey The tools available for animation, UV texturing, Hair, skin, facial and enviormental rendering software run from an entry level subsciption for $599. available in March, to the extremly complicated software at $4995.

Autodesk also announced an increased commitment and activity in global education programs and sponsership through new Centers of Excellence (COEs) in China, India, and Russia. This is possible because of Autodesks grasp of the world wide industrys needs and the ability to provide funding and expertise in state of the art research and consulting.

The company is in a state of constant improvement and R&D to put out the best products possible in a world wide competative market. Be it the aqusistion of new technology or improvment of products in use.

The company is orginized into two segments. The Design Solutions Segment and the Media and Entertianment Segment. DS segment accounted for 87% of income in 2007. Eps has had constant improvement. 89.8% gross Magin, 17.2% net Margin, P/E normalized 32.4, Return on Assets 19.8%, Equity 32.7 Per share data EPS excluding extraordinary items 1.47, EPS normalized 1.19, Rev per share 8.53, BV per share 5.11 Cash per share 3.78, cash flow per share 1.71 No dividend for ADSK Growth, Sales 14.2% EPS 30.3% It also carries an S&P 4 star buy rating

There seems to be yearly stock options compensation.That seems to cut down on the
amount of insider buying. Still ADSK has had no insider buying in the past 5 years. There has been planned sales.

Now to why I would buy this stock. It is selling at a dicount right now compared to its
competitors and has leveled out at $38.50 for 11 days now. That means the shorting and playing with this stock price has ran its course. The $40.00 call option contracts are selling well. I can't say that this stock will shoot to $50.00 but what I am willing to say is this stock will go to $ 44.50 with in 2 weeks and provide a nice profit. A little patience to allow it to make its move , Buy and Sell in 2 to 3 weeks at most. Really I don;t think it will be that long Well I hope this has answered J'an commennte's questions at service@investorplaceblogs.com

Ric Bottorf