Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Paul Senior who wrote (31435)	7/10/2008 2:03:09 PM
From: Jurgis Bekepuris	Respond to of 78462

DOW is somewhat interesting. It is cheap, but then the earnings have declined for last couple of years. And it's still unclear when/if it will work out the rising oil costs for its products. Margins are very slim. So I'll pass. I probably would not sell if I had it, but I see why you could argue that it's a sell still. GGB - I don't have a strong feeling about steel producers. It seems that with iron ore price climbing and with coal price climbing they may be squeezed in between like oil refiners are. But maybe I am wrong and they can pass the price increases along. I have a tiny bit in PKX but I am not buying more and I will pass on GGB. BTW, so far their margins were dropping. I also don't like their leveraged balance sheet. :/

To: Paul Senior who wrote (31435)	8/13/2008 2:25:44 PM
From: Paul Senior	Respond to of 78462

Adding small to my losing position in auto supplier Lear, LEA. This stock seems to track GM stock, finance.yahoo.com At some point, if GM stock goes to near zero, I suspect GM will get some government support (ala Chrysler in its dark days). So the production of GM vehicles (and LEA vehicle seats & electrical distribution business) will not necessarily evaporate. LEA also sells to Toyota, Hyundai (Alabama), etc., so if vehicle (truck/car) production ever picks up (Vehicle production is at multi-year low now.), LEA should still be able to participate. I assume LEA has the similar problems of GM - high union labor costs, pension issues, maybe (or maybe not) health care costs. And it's in an increasingly competitive business. Some info about Lear from the 10K: "We are a leading global automotive supplier with net sales of $16.0 billion in 2007 (net sales of $15.3 billion excluding our recently-divested interior business). With this level of sales, we would rank within the top 200 of the Fortune 500 list of publicly-traded U.S. companies. Our business is focused on providing complete seat systems, electrical distribution systems and electronic products, and we supply every major automotive manufacturer in the world. In seating systems, based on independent market studies and management estimates, we believe that we hold a #2 position globally on the basis of revenue. We estimate the global seating systems market to be between $45 and $50 billion. In electrical distribution systems, based on independent market studies and management estimates, we believe that we hold a #3 position in North America and a #4 position in Europe on the basis of revenue. We estimate the global electrical distribution systems market to be between $20 and $25 billion. We have pursued a global strategy, aggressively expanding our operations in Europe, Central America, Africa and Asia. Since 2002, we have realized a 12% compound annual growth rate in net sales outside of North America, with 55% of our 2007 sales coming from outside of North America. Our Asian-related sales (on an aggregate basis, including both consolidated and unconsolidated sales) have grown from $800 million in 2002 to $2.9 billion in 2007. We expect additional Asian-related sales growth in 2008, led by expanding relationships with Hyundai, Nissan and certain regional manufacturers. In 2007, our sales were comprised of the following vehicle categories: 58% cars, including 24% mid-size, 19% compact, 13% luxury/sport and 2% full-size, and 42% light truck, including 23% sport utility/crossover and 19% pickup and other light truck. We have expertise in all platform segments of the automotive market and expect to continue to win new business in line with market trends." finance.yahoo.com

To: Paul Senior who wrote (31435)	12/2/2008 6:18:53 PM
From: Paul Senior	Read Replies (1) \| Respond to of 78462

I've begun adding more shares today my Sysco position. "Sysco is the global leader in selling, marketing and distributing food products to restaurants, healthcare and educational facilities, lodging establishments and other customers who prepare meals away from home. Its family of products also includes equipment and supplies for the foodservice and hospitality industries. The company operates 180 distribution facilities serving more than 400,000 customers. For the fiscal year 2008 that ended June 28, 2008, the company generated more than $37 billion in sales." A big plus would seem to be that distribution costs have come down or are coming down (fuel cost for the trucks that Sysco uses to make all those deliveries). Otoh, with demand for hotel rooms (and hotel meals) down, and with people reducing restaurant visits, the number of Sysco deliveries might be fewer and quantities delivered less. At the current price, you do get the dominant company in the industry, a long history of rising dividends (with the div. yield now up to 4%), great roe, and a company profitable every year (so far). I'll repeat an opinion I've had before: I've observed Mr. Buffett has bought his food stocks at p/e of 12. With that he gets the brand names of the company he's purchased. With SYY, you get a p/e at or below 12 too now. You don't get the well-known consumer brand names, but you do get a powerhouse - in size and scale - a company that delivers food products that commercial customers need - Sysco's commercial brands. And this is a very diverse customer base. sysco.com ----------------- If stock will drop a point more or so on no adverse news, I'll consider if I want to punch up my small position to size it more in the direction of a core holding. -- Here's a 'dividend analysis' of Sysco by Steve Felix in Sept in his "Dividend investing for retirement" subject thread: Message 24912667