Month: April 2016

The stock market rout over the Summer and the beginning of the year led to a broad decline in animal spirits of the consumer. It’s starting to be readily apparent in the earnings commentary on 1st quarter conference calls as business seems to have mysteriously improved with the rise in the share price in March.  It seems the market really is the leading indicator of both the economy and the Fed. U.S. corporate profits are set to decline for the third straight quarter, the longest and broadest slide in earnings since the financial crisis, weighed down by the energy slump … Read more

Under Armour trading at 57 forward P.E. is near all time highs which is amazing considering that the market seems to be in a major shift from growth to value.  This doesn’t seem to have gone unnoticed by the insiders who are dumping an unprecedented amount of stock. Two insiders dump 25-45% of their holdings.  

I try to stay out of politics for obvious reasons as some of my clients are Democrats and some are Republicans but all of them appreciate a good return on their investment.  The Presidential contest will likely have great impact on the markets in the short term so paying attention to it does matter.   So check out this Youtube video of the White House Correspondents Dinner in 2011 where Obama publicly humbled Donald Trump and then read this so prescient New Yorker article from late last year. https://www.youtube.com/watch?v=k8TwRmX6zs4 Some day someone may well write a kind of micro-history of … Read more

Insider selling is a very difficult thing to analyze.  After all significant buying only means one thing but insiders could sell for a variety of reasons.  We were short Apple going into earnings in spite of the stock being fundamentally undervalued because insiders were unloading Apple stock in an unprecedented  manner. VP Phil Schiller sold $62.6 million in March and April of this year. CO Jeffrey Williams sold $61.7 million April and $28.3 million in March of this year. CFO Luca Maestri sold $5.3 million in March of this year. CEO Tim Cook sold $18 million in October and November … Read more

United Airlines CEO Oscar Munoz bought a million dollars worth of company shares. Jamie Dimon made a fortune buying JPMorgan stock. Source: When a CEO buys shares, here’s why you should do the same – Yahoo Finance

Initially Intel stock went down understandably on the news that business was slowing and the 2nd quarter revenues numbers would be lower than forecast and the Company would lay off 10% of the workforce. What I don’t understand is why the stock reversed and went up.  Note we were short for earnings.  Maybe the market just got it wrong as evidenced by the Chairman of the Board selling $5.9 million shares reducing his stock ownership by over 30%. Source: EZ-EDGAR(tm) Filing: INTEL CORP F4 Filed on 2016-04-22

“I find it hard to grasp a continued rally without the participation of the second-largest group in the S&P 500,” said Omar Aguilar, chief investment officer for equities at Charles Schwab Investment Management, which oversees about $278 billion. Source: Miserable Year for Banks: Stocks Suffer as Rates Stay Low – WSJ

Japan may be weakening but all that really matters is the US and Chinese economies to some degree.  But it will temper global growth with Japan and Europe slow. There’s increasing evidence the People’s Bank of China’s year-and-a-half-long easing cycle is hitting the mark. Source: China’s Monetary Easing Is Starting to Hit Home – Bloomberg

For global equity investors and Shinzo Abe, it’s splitsville. Source: BlackRock Joins $46 Billion Japan Pullout – Bloomberg

Under Jack Dorsey, Twitter’s data business has gotten stronger as he pitches his company’s global, real-time services. Source: Twitter Data Business Is Growing As Jack Dorsey Courts Developers I have to admit, I hadn’t given Twitter much thought even though there was significant insider buying, notably Chairman Omid Kordestani increased his holdings 30.6% with his purchase in February of 122,250 shares at $16.34. The reason I dissed the buying was that even though CFO Noto was a buyer too, there were plenty of owners cashing out.  It was the Business Week interview with founder and newly named CEO, Jack Dorsey, that … Read more