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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: - with a K who wrote (23289)	2/7/2006 5:43:36 PM
From: Grommit	Read Replies (2) \| Respond to of 78594

JNJ and HSE ........... (HSE just one example of many because they already reported earnings) thanks. when one undiversifies, choosing the right sector can be more important than the stock. that's why i've been pretty much absent this board for almost a year. but i've been thinking of selling some oil sands and reentering the value world. trying to spread out my portfolio now... but it is still hard to find a more compelling growth and valuation story than oil sands -- if you believe in higher chinese energy demand and limited world production capacity. here's just one example (of many) -- look at Husky vs JNJ: finance.yahoo.com finance.yahoo.com HSE: price $CAN71.50 2005 EPS can$4.65 yahoo 2005 EPS can$4.72 press release. 2006 EPS can$6.14 yahoo 2006 EPS can$6.51 CIBC (report 1-11-06) let's use 2006 EPS of 6.30 2007 EPS can$7.86 CIBC 2006 PE 71.5/6.3 = 11 2006 / 2007 growth = 33% and 25% JNJ: price $56.8 2005 EPS $3.49 2006 EPS $3.79 growth 8.6% PE 2006 = 15. so HSE with a PE of 11 and 25% or 30% growth is a better buy than JNJ with a PE of 15 and growth under 10%. now, i haven't look deeply into JNJ, so if I am missing something, please let me know. But I am not a JNJ buyer at these prices. HSE: For the year 2005, Husky Energy Inc. is pleased to report that net earnings were up 100 percent to a record of $2.0 billion or $4.72 per share (diluted), up from $1.0 billion or $2.37 per share (diluted) in 2004. Cash flow from operations in 2005 was $3.8 billion or $8.93 per share (diluted), compared with $2.2 billion or $5.18 per share (diluted) in 2004. sorry for the ranting. grommit