FA help...

Picked up a little GOL for short term trade.

NTRI 60 min chart looks interesting here and may offer short term trade on long side.

DXPE 60 min chart looking interesting here and might offer a short term trade on the long side.

[IIC]

I will need to gather more knowledge of the FA side of things and may even buy a book to try to learn. I’ll also need to find out how to sift thru the chaff. I’ve thus far learned low PE is good and high does not mean bad but the stock may have run its race. I’ve learned a company that has increased sales over a 3-year period might be able to continue to increase these sales. I’m thinking this and could be wrong. If the pe has a 10 year history and is now at the lowest point in those 10 years this stock is attractive to investors as long as sales and earnings are strong.

Decreasing sales is not always bad...Depends why...A company that eliminates low margin products to spend more time selling high margin products can actually have increased eps as revenue declines. Or possibly, they have taken the lean and mean approach...eliminated lower producing sales staff...sales might decline overall...but eps could increase due to elimination of dead weight overhead...Just some food for thought...Doug(IIC)

Here is a brief look of the entire group that NBR is in

[Rob]

High P/E OK IF ...

I'll only buy a high PE stock if its earnings AND revenue growth are accelerating.

I wholeheartedly agree with that, $$$ Mr. Market $$$. Here's an example that illustrates the power of revenue growth:

[mrmarket]

I will need to gather more knowledge of the FA side of things and may even buy a book to try to learn. I’ll also need to find out how to sift thru the chaff. I’ve thus far learned low PE is good and high does not mean bad but the stock may have run its race. I’ve learned a company that has increased sales over a 3-year period might be able to continue to increase these sales. I’m thinking this and could be wrong. If the pe has a 10 year history and is now at the lowest point in those 10 years this stock is attractive to investors as long as sales and earnings are strong.

Nothing is a certainty...for example the homebuilders, even with record earnings and revenue growth, had stubbornly low PE ratios. Then the market finally decided that speculation in real estate had run its course and the homebuilders got hammered.

Having said that, these companies continue to make money, and I see management doing the following:

paying dividends, buying back stock, consolidations...all are good for stock prices.

I hope that gave you a little taste of the kinds of things I look at.

I will need to gather more knowledge of the FA side of things and may even buy a book to try to learn. I’ll also need to find out how to sift thru the chaff. I’ve thus far learned low PE is good and high does not mean bad but the stock may have run its race. I’ve learned a company that has increased sales over a 3-year period might be able to continue to increase these sales. I’m thinking this and could be wrong. If the pe has a 10 year history and is now at the lowest point in those 10 years this stock is attractive to investors as long as sales and earnings are strong.

[mrmarket]

10-4 MM, ok looking into NBR’s PE I notice that right now it is showing a 10-year low at 14.6. Now according to PE readings this stock should be cheap at 34.54. It also makes me wonder if long term investors will often sell the stock if it should get closer to its 10 or 5 year high. This might indicate a stock that is now run its race? Short term I’m not bullish in the energy sector but NBR looks attractive.

Here is my understanding thus far of the FA approach on NBR:

NBR-drilling Company

This company has increased sales over the last three years from 1,880>2,394>3,459 and is currently at a PE of 14.6 this also is a 10 year low.
Sales have also increased over the last three QTR’s from 893>1,017>1,163

Return on Equity is currently at 20.4 and the 5 year average is 12.2
This stock is projected to continue strong earnings going into 2007 with this year projected EPS 3.34 and next year 4.50.

Based on me limited exposure to FA here is what I see
Low P.E ratio compared to the 10 year average. Expected strong growth going forward and so I rate NBR highly as a possible buy when TA conditions improve.

Runner,

NBR is an energy play, so I really try to hold back commenting on it. However when I compare the drilling companies, I like to see how much money they make in different oil price environments. For example, how much money did they make when oil was $40, $50, $60 and now $70/bbl. You can compare these earnings with those of the other contract well service firms and determine which companies the oil guys go to when the going just started to get good. This gives you an indication of which company will be left standing if oil prices start to fade again.

If you love the oil business right now, this is a good stock to own. If you are skeptical about the oil business, then maybe this is too risky for you. You are right though, the low PE makes it easier to swallow.

There's no reason why good FA can't be used with TA.

[billyjoe]

Runner,
Please tell us if you decide to buy any on your list.

billyjoe

[mrmarket]

I hope that gave you a little taste of the kinds of things I look at.

[mrmarket]

Nsr

I really can't figure out what this company actually does to make money. They seem to be successful at it, but since I'm too stupid to understand their business, I won't buy their stock, especially at a PE of 41.

[mrmarket]

Cwtr

CWTR has been in the MM top 5 before, so you know I have to like it. Unfortunately for me, I never bought this stock and its PE is now over 50. When I'm paying that much for a stock, I really have to like its product and understand just what it is that makes it that much better than its competition.

In the case of CWTR..it's a specialty retailer of women's stuff. Sure it is growing its revenues and earnings but I can't quite grasp why other companies won't be able to jump into this fun. It's forward PE is still as high as 30, which means even if it makes its numbers next year, its stock will still be expensive.

With only a 6% profit margin, they need to push a lot more volume of this stuff. I just can't see the growth that will sustain it right now. CWTR was a MM top 5 pick back in June 2004. I guess I should have bought it then. I can't really love it now.

WOW, thanks for taking the time to check these out for me MM.

10-4 MM, ok looking into NBR’s PE I notice that right now it is showing a 10-year low at 14.6. Now according to PE readings this stock should be cheap at 34.54. It also makes me wonder if long term investors will often sell the stock if it should get closer to its 10 or 5 year high. This might indicate a stock that is now run its race? Short term I’m not bullish in the energy sector but NBR looks attractive.

Here is my understanding thus far of the FA approach on NBR:

NBR-drilling Company

This company has increased sales over the last three years from 1,880>2,394>3,459 and is currently at a PE of 14.6 this also is a 10 year low.
Sales have also increased over the last three QTR’s from 893>1,017>1,163

Return on Equity is currently at 20.4 and the 5 year average is 12.2
This stock is projected to continue strong earnings going into 2007 with this year projected EPS 3.34 and next year 4.50.

Based on me limited exposure to FA here is what I see
Low P.E ratio compared to the 10 year average. Expected strong growth going forward and so I rate NBR highly as a possible buy when TA conditions improve.