Tuesday, January 19, 2010

BAGAKOAA Jan 19, 2010 CHU on this.


Jan 19, 2010 CHU on this.

Well Citi continued to disappoint with a 33 cent a share loss, the guess of 25 cent a share loss made here this weekend was way off. The stock came back later in the day.

IBM came in way below my grandiose expectation at 3.59 a share. (The idea was for 4.19 a share higher than all of the analysts) That is between the estimates and the whisper number so look for a sell off tonight and at the opening. Please read Palmisano’s comments and listen to the earnings call. This, Like INTC this is a strong well positioned expertly run company. If the stock drops more than 1.5 to 2.0%, consider picking up some. This is the 7th year of double digit growth. 15 billion in free cash flow, ya gotta love it. Margin is approaching 50%, sweet. This will be a stock to hand down to the grandkids.

With all the scrutiny on banks and financial organizations, it is easy to see how the competitive climate is changing and that their need for more IT infrastructure will be met. For obvious reasons IT cap expenditures were cut late 08 and all of 09. 2010 Should see a 6-7% increase in IT solutions. This bodes well for the likes of IBM. Once the manufacturing sector starts seeing demand for product post the initial pipeline fill, we should see yet another 5% in IT Cap spending. This should take us into first quarter 2011 and again support the likes of IBM.

AAPL was up today as they announced a product event next week. That is cool. All they do is announce a product event and their stock goes up. Of course the expectation is the new notebook, eReader, browser, 4G, diaper changing notebook. I have AAPL so its good news and a nice change to the upside after trading sideways, well downward sideways for the last 3 weeks.

As far as trades in the portfolio. I accidentally took a profit in Hasbro. The 15% gain in 3 months was accidental as this dopey guy was trying to set a stop and mistakenly set a limit order. Ouch! I will review and get back in as the Transformer franchise revenues should have done well over the Holidays.

Sold out of my position on FLIR with a teeny weeny gain. Cramer lambasted the CEO for being less than forthright about a recent appearance. The price had done OK because of the lap bomber incident. He felt the CEO knew they were going to disappoint but did not say anything during his last visit to Mad Money. Over the weekend I did my own homework and agree that stock probably did get a bump from the lap bomber, has not done a great job of integrating the various divisions of the company and probably does lack a clear vision of where the company should go. Anyway I am out and suggest others do the same before the homeland security threat calms and people figure out the issues as well. If that paragraph didn’t get a few visits from NSA and Echelon, nothing will. Fortunatley the site needs the visits.

I also got out of my speculative position in SPNS. They sell software to the insurance industry. I don’t remember why I bought it and have done Ok with it. I started with it in October at about 1.09 a share. In cleaning up my portfolio this weekend. It looks like a solid stock but the steam seems to have run out of it. Take the money and run.

I mentioned I pulled out of CHU after a disappointing run. China Unicom is still getting pimped by Cramer. I felt you should know that as he is convinced long term it is a good bet. I got out for various reasons including the GOOG issue and the rumor (Remember buy on the rumor sell on the news), that CHU was going to postpone the release of two GOOG phones with Droid software. Cramer still has his money of AAPL, the iPhone and CHU. He bought CHU big on this dip. Just wanted you to have a balanced perspective. Cramer might know a little more than this Monkey in a casino.

Salve Lucrum


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