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Strategies & Market Trends : Disciplined Investing, especially the NAIC way -- Ignore unavailable to you. Want to Upgrade?

To: - with a K who wrote (365)	1/28/2003 8:56:16 AM
From: Mark Marcellus	Read Replies (1) \| Respond to of 469

Re HD, on the SSG I get a buy range up to around $30. Beyond that, it becomes a judgment call on whether Nardelli is saving or destroying the company, and there are strong opinions on both sides of the argument. There is no question that he has strengthened the company financially, but a lot of veteran HD employees (and customers) are saying that he ruined the company's culture in the process. My own opinion is that the company's culture HAD to change. The decentralized entrepreneurial model that worked so well in earlier years was choking HD at their current size. They would have been in trouble regardless, but the looming threat from Lowe's would have made it happen a lot faster. Nardelli has made some mistakes, most notably the excessive cut back of full-timers and overreliance on part-timers, but overall I think he's done an excellent job. As with any company in transition, plenty of uncertainties remain, but IMO HD is an excellent buy at current prices. Unfortunately, my club bought in the mid 30's. I bought a little at about $25, bought a lot more around $22 right after their recent miss, and plan to add another chunk if we get down to the $17-18 range.

To: - with a K who wrote (365)	1/28/2003 10:41:43 AM
From: The Philosopher	Respond to of 469

Thanks for the congrats on AZO; we owe it all to diligent use of the SSG. We require the person following a stock (each stock is assigned to a member to follow) to update the SSG and present it after each quarterly earnings report. Funny you should mention HD and LOW; I'm in the process of preparing an analysis of them to present a week from Thursday. I agree they both look good, except that HD worries me if you look at the PERT-A. Qtr-over-qtr sales results have been slowing significantly. This doesn't bode well for the future -- it may be reaching he same point that McDonald's reached, that at some point it has saturated the market and growth no longer comes easily, if at all. I agree that at this moment Lowe's looks like the more aggressive, better managed, more nimble company. I'll check out RD. Thanks.

To: - with a K who wrote (365)	1/28/2003 10:46:44 AM
From: The Philosopher	Read Replies (1) \| Respond to of 469

RD certainly isn't a classic NAIC stock, is it? Not great growth, and earnings all over the map. But at its five year low, it could be a fallen angel. Or is it a falling knife? Are the cockroaches out? I would have to take a lot closer look at it. The dividend is certainly interesting, if they can sustain it. They certainly show a commitment to paying a dividend, but it varies a chunk year to year. It would never have shown up on any of my screens because of the erratic earnings line (BTW, the NAIC data file has actual earnings data totally missing, blank spaces. Wonder what THAT means?!), but as you say the dividend is interesting.