Price The Market Part 47
Glen is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Hi, my name is Glen Bradford. I am pricing the S&P500. You are welcome to join me for the ride. Does anyone else stay awake late into the night and draft up Pro Formas and price companies? Just me? Thought so. I'm a stockaholic.
299. First Solar Inc. (NASDAQ: FSLR) has fallen from over $150 to less than $40. Is it a buy now? Well, at these prices I can't really argue that it is worth selling. Target: $30-$50. I think that they have a feasible technology until nuclear and fusion catch up. Solar power has feasibility problems due to the electrical grid not being able to store power at all. Jim Chanos and John Hempton were spot on with their short positions here. Bravo. I think the short case ran its course as I found a few analysts really pushing it out. Tax loss selling usually blows out the end of the game as people finish taking their losses and shorts begin to ring the register.
300. Flowserve Corp. (NYSE: FLS) has seen some relatively large insider buys below $95. That's good enough to set a floor for me. Their backlog is at a little under half of their market capitalization coming in at $2.81B. Their price to book is a little over 2. The company hasn't leveraged up even though their earnings have been strong. A solid dividend but not too strong. Alright, you have the permission to rock on to higher prices! Target: $95-$120. I like what I see here.
301. Avery Dennison Corp. (NYSE: AVY) has gotten crushed since the middle of last year. They cut guidance by about 12%. They were able to maintain their margins even with volume declines. That's pricing power. Target: $30-$35. It's funny to me that their global tax rate goes down with increased business. Doesn't that sound like the opposite of taxes here in America? I'm giving this an outperform in CAPS because it is incredibly cheap as it looks investors have given up.
302. 3M Co. (NYSE: MMM) is right in the middle of my target valuation. After pricing all of these companies so far I am convinced that analyst estimates are too optimistic on average. How do I come to that conclusion? Analyst targets tend to be above the stock price and they tend to be raised as the price appreciates until the price tops out and the analyst looks foolish. MMM has a lot of $100+ targets. No way. That's a P/E of 17+ on MMM. Unbelievable. Target: $80-$90. Trade accordingly.
303. Amphenol Corp. (NYSE: APH) looks like an even better company to trade. The volatility here is remarkable. Target: $46-$54. After they cut their guidance the stock took a dive but since then has come back up to retest those highs. I personally won't be betting on it breaking past them. Their dividend is less than a token dividend. It's laughable. It probably costs them more in fees and headache to account for it than it will ever do for anyone who receives it. I pity the fool who owns this as part of a dividend investment portfolio. I think they should just cut the dividend. $42 makes for an excellent floor.
That's all for now. If you want me to price your company email me: globalspeculation at gmail.com.
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