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

To: Paul Senior who wrote (40423)	12/6/2010 3:25:08 PM
From: Madharry	Read Replies (2) \| Respond to of 78748

ive decided to not to make any changes to my portfolio since it seems to be doing fine without any interference with me. sticking with silver, gold and other miners- gfre mfcaf/ttt. goog ibm and gm. just watching with a stupid grin on my face for now.

To: Paul Senior who wrote (40423)	12/6/2010 3:37:57 PM
From: Wallace Rivers	Respond to of 78748

Sold STLD today, mostly to raise cash (doing a house reno!) That being said, there has been some insider selling, and IMHO it's somewhat overbought.

To: Paul Senior who wrote (40423)	12/8/2010 12:19:41 AM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78748

Paul, What's your story on CBST? Thanks

To: Paul Senior who wrote (40423)	1/27/2011 10:27:59 AM
From: Spekulatius	Read Replies (4) \| Respond to of 78748

re ABT - anybody looking to buy some ABT here. last time , I bought it, they had 2.5$ in earnings and were trading at around 40$ or a little more. Now they make ~4.5$ and trade at 46$ and change. ABT is about 50% pharma with the remainder in diagnostics, devices and nutrition. It's sort of like JNJ but with much better growth prospects, imo.

To: Paul Senior who wrote (40423)	1/31/2012 1:00:24 PM
From: E_K_S	Read Replies (1) \| Respond to of 78748

Re: Merck & Company, Inc. Common St (MRK) -NYSE Pfizer, Inc. Common Stock (PFE) -NYSE You discussed your views 12/6/2010 on Health Care stocks ( Message 27007980 ) and were avoiding new buys on the major drug companies. Your focus was on specialty drug companies ( finance.yahoo.com ), all have done well during the past year. This was a pretty good observation since the Big Pharma stocks sold off in August 2011, specifically MRK below $30.00/share and PFE below $17.50/share. Both hit my Buy points but I never added to my core positions (deer in the head lights syndrome). My avg cost on MRK is $28.55/share (mainly accumulated in 2008/2009) and PFE is $16.62/share (buys in 2009/2010). The dividend for both companies has been steady yielding around 4%. From your earlier observation in December 2010, several of these large Pharma Companies have patent expiration issues that would impact their FCF and future earnings. Two years down the road, some of these companies seem to have maintained (or grow) their revenues in spite of these events. MRK is now selling at it's GN value of $39.00/share. This is a moving target w/ analysts earnings at $3.76/share but BV at $18.07/ vs tangible BV at $2.32/share. Using BV the GN is $39.00 but using tangible BV you get a GN of $14.00/share. MRK has continued their capital expenditures over the last 5 years and BV has increased every year too (except 2011). To me, it might be selling at the high end of their valuation especially if you look at some of their patents as intangible assets w/ they expire. Drugs they might (or have bought) also includes Goodwill that looses value over time. Pfizer, Inc. Common Stock (PFE) -NYSE has a similar profile as MRK but their tangible BV is actually negative (-$1.43) according to ADFV. The GN is $24.50 but much lower if you use tangible BV. Earnings were hit in 2010 due to patent expiration(s). Even BV and capital spending has been erratic over the last five years, only showing some increase from their low in 2008. I have similar gains in PFE & MRK , both pay a 4% dividend or higher, both are trading near their three year highs and their GN says they are both close to selling at their fair value(s). Didn't know if you had an opinion on the industry in general since on your last post you had positions in JnJ and BMY (I own BMY but sold my JnJ in 2010 at around the current price). My thought was to look at a strategy of writing some "in the money" covered calls on my two largest core positions PFE & MRK (the two make up 4%of the portfolio) and on any market correction sell some naked Puts on MRK (below $30.00/share) and PFE (below $17.5/share). If we get the market correction I expect, both MRK & PFE will test their three year trading lows and would become excellent buys. It is typical of these large Pharma companies to have a large amount of intangible assets (due to acquisitions, expiring patents etc), that it might be better to view the GN values using their BV. If that is the case, then both of these companies are probably selling at their fair value and I should not expect too much more capital appreciation. EKS