Summary of Week Ending May 20, 2012

May 22nd, 2012
in b2evolution, contributors

Written by Mark Bern, CPA CFA

The past couple of weeks have been sobering for investors, as we have seen the S&P 500 Index fall by 5.4 percent and a much anticipated IPO by Facebook fall flat. Some investors may be wondering if the party is going to be lively enough to warrant staying. Part of the problem, in my opinion, has been a round of profit taking in Apple (NASDAQ:AAPL) stock which fell from its high of $644 on April 10, 2012 to close on Friday, May 18 at $530.38, a 17.64 percent decline.  Apple has been a leader of the market as of late and that drop just seemed to take the wind out of the broader markets. But this Monday, May 21, 2012, Apple is up to $552.93 (1:04 p.m. EST) and the broader market is also rallying.  There is an interesting article interesting article that discusses the apparent linage between Apple and the indices which was written by a friend and technician for whom I have a great deal of respect. You may want to take a look as I think it makes for a good read.

Follow up:

I had mentioned in my last summary that I intended to start a new series writing about the master list of stocks that I follow and would like to buy if the valuations got to the right levels.  I didn’t exactly kick off the series as planned, by I did write a two-part article about Apple (Part I and Part II) which made it onto my master list when the company started paying a dividend recently.  I did spook a few down-to-earth investors with an off-handed valuation at the end of Part II.  Of course, my more realistic valuation is found earlier in the piece, but I must have chosen my wording poorly because everyone seemed to forget the earlier prediction in favor of the later. Ce la vie!

I also wrote a summary article summary article to bring things into perspective for my enhanced income strategy series of articles that also included an update on what to do with the Teva (NASDAQ:TEVA) stock that was put to us recently. I hope you’ll find the interim results interesting.

Walgreen (WAG) is running through a rough patch at the moment, but I believe it is a great buy at current levels and explain how to make a 4 percent return on your money over the next two months in this stock using my enhanced income strategy in my most recent article on this quality, well-managed company.

Finally, I wrote an article that may appeal to owners of ConocoPhillips (COP), Phillips 66 (PSX) or investors who may be considering either of the two parts. One commenter claimed that this was the best explanation of the rationale he’d read about why the company split itself. I’m not sure if the reader was correct, but I did put a lot of research and thought into my explanation. I hope you’ll enjoy the article.

This week I will definitely start the series on my master list of companies that deserve to be owned by dividend investors looking for quality, a rising income, and some growth, too. I plan on writing an article on each industry that I follow followed by one or more articles about the companies in that industry and why the companies either made my master list or failed to do so.  The series is about past performance, future expectations, rising dividends, and the long-term expected total returns I am forecasting. I focus on dividend-paying stocks so if that is of interest to you, watch for future updates and summaries.  Happy investing!

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