iBooyah.com Investment Matters

iBooyah.com Financial Blogs

iBooyah.com Investment Matters: Oil profiting strategy

We have written many articles on oil at iBooyah.com because we believed oil plays a large role in the world's economy. When oil was dropping because the weather was unseasonably warm at the beginning of the year, we encouraged people to buy companies like ConocoPhillips (COP), Exxon Mobil (XOM), Chevron (CVX) and Valero (VLO) as they were falling with the price of oil. We also predicted any fall in oil prices would be temporary and should be viewed as an opportunity to buy. Our other prediction that oil will unlikely fall below $50 per barrel remains intact. To profit from oil, read on.. at http://ibooyah.com

As the Feds speak!

As the Feds speak!

Despite recent economic data suggesting the U.S. economy is headed towards a "soft landing", the FOMC has many other reasons to be concern. The November employment number was much greater than the market anticipated. Although this is good news for citizens in search for work; to the Feds, this indicates inflationary pressure. Simply put, as more people have money, the more likely they will spend. When spending increases, the prices of goods and service rises, which in turn decrease the value of our money. The primary tool for combating inflation is to increase the short term interest rate, making it more expensive to borrow. The goal is to make people think twice before pulling out that credit card.

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Reasons the Bull Market will continue in '07

We undersand two weeks into the New Year is hardly enough time to gauge how the stock market will perform the entire year, but despite a rough start, we feel 2007 should be another great year for stocks. When the market hits one of those bad days (and we will), keep these points in mind. Here are six reasons for our optimistic view and some companies to consider:

1. Oil Prices appears to have stabilized. We believed given the recent decline, oil could be trading no more than $60/barrel this entire year. If this prediction holds, consumer confidence will remain strong as inflation will be tamed. The low price of crude should translate into strong consumer spending. The automobile sector will do well if prices of oil remain at this level. Companies such as Honda (HMC), GM (GM) and Toyota %u2122 should do benefit. Heck, even Ford (F) might see the light at the end of the tunnel. Of course, oil affects more than the auto industry, it affects plastics, transportation and etc.

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Pfizer "knee jerk" reaction

Pfizer (PFE) is taking it on the chin this morning as investors are running for the hills. The stock is down about 13% from Friday's close. Dropping from $27/share to $24/share, PFE has lost about $30 billion in market capitalization. The primary reason for the sell off is due to halted development of a key new cholesterol treatment that was heralded as the engine to re-ignite the company's stagnant sales. The news is certainly a disappointment. However, the company did the right thing and cuts its loss instead of attempting to cover up the failed clinical trial, which actually caused a couple of death. If this drug has been released, the damage would be far worse.

continue readking at http://ibooyah.com/blog/2006/12/pfizer_knee_jerk_reaction.html

Netflix Analysis

Netflix Part II: Time to take some profit

Since I last wrote about Netflix in October, the stock has risen almost 27%. In two months, it has risen from $23 to $29. This movement is impressive! What's surprising about Netflix is how the company continues grow despite the eventual demise of DVD. Most analysts covering NFLX knows the future of DVD is numbered as movie distribution are moving towards the network. From this perspective, this company should not be a good investment. However, have these analysts missed the point and under estimated Netflix's ability to adjust to the changing world of movie distribution? I believed so.

Read more at http://ibooyah.com/blog/2006/12/netflix_part_ii_time_to_take_s.html

iBooyah.com: Yahoo (YHOO) a Buy

iBooyah.com upgrading YHOO to a buy

One of Warren Buffet's guiding principles is to invest in things you use and understand. This strategy has proven to be of great success, but it is difficult to find companies that is of good value. In today's bullish environment, it is becoming a challenge to find these types of companies at bargain price. Fortunately, there is one company you probably are using on a daily basis and is a major internet play. What's more interesing is the stock is currently trading at a bargain compared to its competitors. The company is Yahoo! This company is in the same position as Microsoft was earlier this year. In May, MSFT's stock was trading around $23/share. Today, MSFT is almost $30/share. If you recall, in May 2006, Wall St. was disappointed when the company announced it will spend an additional $2 billion in R&D. This caused Wall St. to question the company's future and sell off; six months later, MSFT stock has more than recovered.

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iBooyah.com: Professional Pessimism is your friend

If you haven't noticed, the stock market has been on a tear, setting new highs daily. In fact, the DOW is trading at all time high, almost 400 points above the height of the dot.com bubble. On Tuesday, November 20, the DOW closed at 12,316.54. How long will this rally continue is anyone's guess. Depending on economic data and future interest rate sentiment, the market could change in an instant and head either way. Keep your eyes on the next FOMC meeting. The FOMC is the key. There are some who believe that the Fed might lower interest rate to keep the economy from slowing too much. However, based on recent economic indicators, most analysts believe the Fed will keep rates at 5.25% and possibly cut in early 2007.

continue reading at http://ibooyah.com/blog/2006/11/professional_pessimism_is_your.html

Homebuilders to return

For Homebuilders across the country, 2006 could be viewed as the year the housing bubble finally released some hot air. Similar to the 2000 dotcom bubble, these homebuilder stocks have dropped 50% or more from their all time highs. While the media loves to report on how terrible the housing market is, I believed this is the best opportunity for investors. In some parts of California, new homes that were once selling for 400K is now having hard time moving at 340K. Despite incentives such as free upgrades and cash back, buyers are not willing to commit.

continue reading at http://ibooyah.com

iBooyah.com Investment Matters: Playing with fire, aka hot stocks!

iBooyah.com Investment Matters
Playing with fire, aka hot stocks!
In my 15 years of trading and investing in the stock market, I have never been fond of the so call "hot stocks". The fundamental problem with "hot stocks" is by the time the news reaches the public; the stock is usually over-priced at that point. Consumed by greed, people are tempted to join in on the action in fear of being left behind. The media sometimes further hypes the stocks. We see this every morning on CNBC where some analyst is being interviewed and touting a stock. Once enough people have jumped aboard, the institutional investors then dump their positions, leaving the small investors holding the bag. Despite the dotcom fiasco, people still haven't learned this important lesson. Lesson number one; never attempt to jump on a train when it's going at full speed. Lesson two, don't play with fire because you will get burn!

iBooyah.com Investment Matters: Psst! Newly IPO - KBR Inc. (KBR) is sound

Psst! Newly IPO - KBR Inc. (KBR) is sound

KBR is a subsidiary of Haliburton (HAL). On November 19, 2006, HAL spun off KBR as a separate entity. The issue was offered at $17/share to exclusive investors and closed up 22% on the first day of trading. It was a very successful IPO; the company netted $440 million. It is important to note, HAL still owns over 80% of KBR, but plan to sell the remaining shares to the public in April 2007 (AP, 2006).

iBooyah.com Investment Matters: Does Baidu (BIDU) hold the key to China?

Often referred to as the "Google of China", Baidu (BIDU) has been humming along since its IPO in August 2005. The stock was an instant hit as investors was still enthusiastic after the success of Google's IPO. The stock (BIDU) opened at around $120/share. The enthusiasm quickly turned into doubt as Wall Street began to question the viability of Baidu, especially when Google appear to have a lock on the search business. Most analysts were quick to dismiss the company as they were unable to justify the sky high valuation. This pessimism caused the stock to hit bottom in February 2006, at around $44/share (Yahoo! Finance, 2006). Read more at http://ibooyah.com

iBooyah.com Investment Matters: Toyota Motors Corp (TM) is actually inexepensive

With all the attention Toyota %u2122has been receiving lately, one would think Toyota is the only car company worth investing in. The problem however is the stock price of TM has already risen so much this year that it's difficult not to worry about its valuation. Let's briefly take a closer look at TM's valuation.

iBooyah.com Investment Matters: Yahoo! (YHOO) to be 2007 stock of the year

A proven method of selecting which stock to invest in is to buy positions in companies that provide the products and services we use on a daily basis. When it comes to the internet, we remain bullish on Yahoo! (YHOO). While Wall St. has basically given up on YHOO and rightfully so given 2006 was a terrible year for the company, we believed 2007 could turn out to be a great year. Here are some reasons we believed YHOO is worth your time:

iBooyah.com Investment Matters: It's the oil stupid!

When it comes to the stock market these days, the price of oil plays a big part on where the market goes. While oil has been on the decline as of late, don't be fool. The good old days of $30, $40 or even $50/barrel will never return. According to recent AP report, the world produces about 85 million barrels per day and we consume all of it. The world can't get enough of it. Moreover, if the price of oil falls too quickly, all that the oil czar has to do is cut production to keep prices high. The oil market is the most manipulated of any commodity. The dream of "untapped reserves" and "alternative energy" is misleading and far from reality.

iBooyah.com Investment Matters: AT&T (T) - The Telecoms are back at it again!

Happy New Year! As we start 2007 with cautious optimism, we feel this year could be as exciting as 2006 in respect to the stock market. However, given the recent gains, we also feel it would be prudent to go over your portfolio and sell some your positions if the gains have reached your original target. Taking money off the table and reinvesting it in other stocks will help us reduce the overall risk. With that said, the first stock analysis of 2007 is AT&T (T).

iBooyah.com Investment Matters: 21st Century Investing Requires Global Strategy

Today's portfolio management requires 21st century approach. Twenty years ago, the bulk of investment available to individual investors consisted of U.S. stocks and bonds. Now, however, we have access to a wide range of securities sold throughout the world. Several changes have caused this explosion of investment opportunities. The growth and development of numerous foreign financial markets, such as of those in Japan, the U.K, and Germany, as well as in the emerging markets, such as China, have made these markets accessible and viable for investors around the world.