I did my research over the past few days and this is what I came up with. First let’s start with the tech giant Apple (AAPL).
Apple (AAPL) reported record revenue and had the highest earnings in company history. They reported revenue of $20.34 Billion and net quarterly earnings of $4.31 billion. That comes out to $4.64 per diluted share. This time last year Apple made $12.21 Billion with earnings of $2.53 Billion or $2.77 a share. They earned 67.5% more a share from a year ago. $4.64 vs. $2.77. That’s works out to be $1.87 more a share. That is a phenomenal number! Apple sold 3.89 million macs, 14.1 million iPhones (Up 91% from last year), 9.05 million iPods, and 4.19 million iPads. All products were up in unit growth – the iPod which was down 11% from a year ago. International growth continues to drive sales.
The numbers are very promising for Apple in the near future. As of today Verizon is now offering the iPad in stores. I’m interested to see next quarter numbers with the addition of Verizon. The iPhone is the largest revenue driver for Apple and with the new release of the white iPhone (Different Color) in the coming months, there should be a nice spike in iPhone sales. Also, the introduction of Apple TV should add another line of revenue to the company.
The Holiday is always a great time for tech gadgets and Apple should benefit nicely from the Christmas season. Apple continues to improve the strength of their business and I don’t see this company letting up anytime soon. This is still a strong buy for me. I can’t even explain what Apple has in store next as the conference call was full of exciting up and coming business. You have to listen for yourself to understand the positive outlook for Apple’s future. Check it out!
Conference Call
http://www.apple.com/quicktime/qtv/earningsq410/
Next let’s move onto the Peoria Powerhouse! Better known as Caterpillar (CAT)
Caterpillar (CAT) had a great number as I mentioned last week. Compared to last year Caterpillar is on a roll! They earned $1.22 vs. $0.64 this is a $0.58 a share increase from 2009 3rd quarter earnings. That’s an increase of 90.6% in earnings per share. Now here is my take on the earnings. CAT is doing extremely well! The increase in sales volume, favorable pricing, and an improvement in manufacturing costs helped Caterpillar rise to the top for the 3Q 2010 earnings. Other positives include an increase in 2010 sales and revenue from a range of $39 to $42 Billion to a revised number of $41 to $42 Billion. This is slightly higher, but definitely an improvement. The 2011 outlook continues the upward trend at a projection close to $50 Billion. The potential for an $8 Billion increase in sales and revenue should attract new investors. Caterpillar continues to increase their exposure internationally, which should drive sales for 2011.
From browsing over the numbers all sales and revenue were up in all geographical regions compared to the 3rd quarter last year (2009). Much of the growth has come from the machinery side of the business. Machinery sales and revenues were up 89% in North America, 121% in Latin American, 60% in EAME, and 81% in Asia/Pacific. Over 60% of sales and revenue was generated internationally. Engine sales were up 21% from 2009, but I see the bulk of the money being made in machinery. The outlook for 2011 is promising due to the favorable growth rates of the developing countries. The standout for growth has Asia/Pacific in the lead projected to grow at 7.5%.
With increased pricing in commodities into 2011 the demand for Caterpillar’s products should strengthen. The last thing I would like to say is even in hard times Caterpillar was still able to add 6,200 Full time jobs and 9,000 agency/part-time workers in 2010. The Peoria Powerhouse makes money and creates jobs! It’s flat out beautiful to see a company make tremendous strides from a year ago. My take (CAT is a strong BUY!) The story of the Peoria Powerhouse continues on! Yeah Buddy!
P.S. Westport Innovations (WPRT) just received a big purchase order for 180 Peterbilt liquefied natural gas (LNG) trucks including Westport HD Systems. The purchasing company is Robert Transport out of Boucherville, Quebec. Looks like this natural gas thing may be catching on. Hmm! My take (WPRT goes higher!)
Have a great night. I will be back in action on Thursday!
Clay-
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Thursday, October 28, 2010
Sunday, October 24, 2010
Homework! It's The Only Way.
I said on Thursday I was going to research in depth on the 3rd qtr results of CAT and AAPL, however I was unable to accomplish this task. Conference calls are about 1 hour in length and my smart phone wasn’t agreeing with me. Listening to conference calls while in transit to work is the best way to go. So I will work to listen to all 3 calls over the next few days. I rely heavily on homework and will not give any advice until my research is complete.
That being said doing your own research is very important to finding great investments. Investing is hard work, but it pays off when the proper steps are taken to finding that undiscovered company. When investing in stocks the potential for huge profits is during the infancy of a company. Investing before a company is discovered by all of the big institutions is a great way to supercharge your investment portfolio. I like to have a mix of small, medium, and large companies. Large companies offer income and stability. Medium size companies offer growth with minimal income and small companies offer rapid growth (Like Westport Innovations).
Small companies have the potential to make an investor a millionaire with a small investment over time. Now that’s exciting! That is the reason behind diversification. You don’t want to have all of your money tied up in large companies. This may be a more conservative approach by investing in the well known large cap companies, but the potential for significant returns is minimal. Plus in my opinion it’s truly boring! I like change and new companies entering the market is a great recipe to fight boredom.
If investing becomes boring, you’re not as likely to pay attention to your investments. Not paying attention will lose you money. Losing money is not a part of my vocabulary. Yes I lose money just like everyone else, but I minimize my losses with proper research and cut my losses early to move onto better money making opportunities.
The message for today is homework. Everyone had to do homework throughout their school years and in order to get ahead one must continue to do homework for the rest of their lives. Homework prepares one for opportunity. The opportunity to take the money to the bank! LOL!
Also, Schlumberger (SLB) I mentioned on Thursday reported on Friday. They had a solid quarter and the stock closed up 5.38%. Looks like oil service demand is steadily rising. The future for this Industry is heating up for potential profits in the near term.
Lastly, I would like to mention that for the next couple of months I’m going to blog only on Thursdays. This will allow for more time to research and will provide quality posts that can make everyone money.
Happy Sunday!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday.
Occasional Stock Market Commentary during the week.
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Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
That being said doing your own research is very important to finding great investments. Investing is hard work, but it pays off when the proper steps are taken to finding that undiscovered company. When investing in stocks the potential for huge profits is during the infancy of a company. Investing before a company is discovered by all of the big institutions is a great way to supercharge your investment portfolio. I like to have a mix of small, medium, and large companies. Large companies offer income and stability. Medium size companies offer growth with minimal income and small companies offer rapid growth (Like Westport Innovations).
Small companies have the potential to make an investor a millionaire with a small investment over time. Now that’s exciting! That is the reason behind diversification. You don’t want to have all of your money tied up in large companies. This may be a more conservative approach by investing in the well known large cap companies, but the potential for significant returns is minimal. Plus in my opinion it’s truly boring! I like change and new companies entering the market is a great recipe to fight boredom.
If investing becomes boring, you’re not as likely to pay attention to your investments. Not paying attention will lose you money. Losing money is not a part of my vocabulary. Yes I lose money just like everyone else, but I minimize my losses with proper research and cut my losses early to move onto better money making opportunities.
The message for today is homework. Everyone had to do homework throughout their school years and in order to get ahead one must continue to do homework for the rest of their lives. Homework prepares one for opportunity. The opportunity to take the money to the bank! LOL!
Also, Schlumberger (SLB) I mentioned on Thursday reported on Friday. They had a solid quarter and the stock closed up 5.38%. Looks like oil service demand is steadily rising. The future for this Industry is heating up for potential profits in the near term.
Lastly, I would like to mention that for the next couple of months I’m going to blog only on Thursdays. This will allow for more time to research and will provide quality posts that can make everyone money.
Happy Sunday!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday.
Occasional Stock Market Commentary during the week.
Feedback Welcome!
Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
Thursday, October 21, 2010
Caterpillar-The Peoria Powerhouse!
Caterpillar (CAT) was and still is the reigning champion of the farm and construction industry! Today they have proven to the world that they can deliver even in a slow economy. Caterpillar came out blazing with a phenomenal quarter beating analysts’ estimates by $0.13 or roughly 12% higher than expectations. The number was $1.22 vs. $1.09 a share. 12% seems good, but what about comparing to this time last year? Caterpillar earned $1.22 vs. $0.64. That’s a 90.6% increase in earnings. A number like that is truly amazing!
Caterpillar beat estimates, had great revenue, and raised their guidance for the remainder of 2010. What more can you ask for? All of these positives point to a higher stock price for Caterpillar. Today was a day filled with profit taking. This stock is up over 38% since the beginning of the year. That’s a huge gain and it would be reckless not to take a little something off the table. A stock like this doesn't come around very often. Although, I haven’t had an opportunity to listen to the conference call, I believe CAT is on track to make even more money in 2011. Stay away for a bit as CAT should come down in price over the next couple of days or weeks. You would be safe to buy a little stock in low 70’s. If it gets into the 60’s you shouldn’t have a problem turning a profit for 2011. I’m going to listen to the call this weekend and I will have updates if I feel it’s of any interest.
Now that CAT has taken the thunder for the day I still have a couple of my favorites to mention. Apple (AAPL) came through big time. Earnings were spectacular and everything seems to be firing on all cylinders. Of course there is going to be people saying growth will slow and iPad sales weren't as robust as expected. Give me a break! Apple destroyed earnings! You’re not going to take the wind out of this sail. Apple will charge higher. I thought the stock was going to pull back big and it hasn’t yet. Maybe it won’t and this stock will continue higher. Personally I believe it should pull back into the $280’s and then move higher. That’s my opinion and I’m sticking to it!
Lastly, I want to briefly talk about Weatherford International (WFT).
Weatherford International has been traveling down a tough road. They did beat analysts’ estimates and I continue to have great confidence in this stock. WFT has positioned themselves nicely to take advantage of any changes that may occur in Mexico. Mexico was a huge bust for them in the 3rd quarter. Mexico turned sour after a political change prevented WFT from drilling this qtr. It’s all uphill from here in Mexico. I believe improvements in this country will allow earnings to exceed expectations in the coming quarters as this was the main driver for decreased revenue. Stuff happens! Even to the best companies. It’s a real positive to see a company deliver even when the cards are stacked against them. WFT is a buy in my book.
That’s it for today. I have some homework to do over the next few days to see what really is going on with CAT and AAPL.
Don’t forget Schlumberger (SLB) the oil service giant reports tomorrow. They are the market leader and many investors look to SLB for a reliable outlook for the future of oil.
Have a great night!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
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Caterpillar beat estimates, had great revenue, and raised their guidance for the remainder of 2010. What more can you ask for? All of these positives point to a higher stock price for Caterpillar. Today was a day filled with profit taking. This stock is up over 38% since the beginning of the year. That’s a huge gain and it would be reckless not to take a little something off the table. A stock like this doesn't come around very often. Although, I haven’t had an opportunity to listen to the conference call, I believe CAT is on track to make even more money in 2011. Stay away for a bit as CAT should come down in price over the next couple of days or weeks. You would be safe to buy a little stock in low 70’s. If it gets into the 60’s you shouldn’t have a problem turning a profit for 2011. I’m going to listen to the call this weekend and I will have updates if I feel it’s of any interest.
Now that CAT has taken the thunder for the day I still have a couple of my favorites to mention. Apple (AAPL) came through big time. Earnings were spectacular and everything seems to be firing on all cylinders. Of course there is going to be people saying growth will slow and iPad sales weren't as robust as expected. Give me a break! Apple destroyed earnings! You’re not going to take the wind out of this sail. Apple will charge higher. I thought the stock was going to pull back big and it hasn’t yet. Maybe it won’t and this stock will continue higher. Personally I believe it should pull back into the $280’s and then move higher. That’s my opinion and I’m sticking to it!
Lastly, I want to briefly talk about Weatherford International (WFT).
Weatherford International has been traveling down a tough road. They did beat analysts’ estimates and I continue to have great confidence in this stock. WFT has positioned themselves nicely to take advantage of any changes that may occur in Mexico. Mexico was a huge bust for them in the 3rd quarter. Mexico turned sour after a political change prevented WFT from drilling this qtr. It’s all uphill from here in Mexico. I believe improvements in this country will allow earnings to exceed expectations in the coming quarters as this was the main driver for decreased revenue. Stuff happens! Even to the best companies. It’s a real positive to see a company deliver even when the cards are stacked against them. WFT is a buy in my book.
That’s it for today. I have some homework to do over the next few days to see what really is going on with CAT and AAPL.
Don’t forget Schlumberger (SLB) the oil service giant reports tomorrow. They are the market leader and many investors look to SLB for a reliable outlook for the future of oil.
Have a great night!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
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Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
Sunday, October 17, 2010
Cosi up over 12% on Friday
Just thought I would throw a little FYI... Cosi the small speculative penny stock jumped up over 12% on Friday due to a major improvement in comparable restaurant sales up 5.2% compared to the 2009 3rd qtr results. Cosi also stated that company owned restaurant sales were up for the 2010 3rd qtr because of a 3.7% increase in traffic and a 2.9% increase in average check according to marketwire. (all research done through yahoo finance)
Cosi (COSI) is very speculative, but the reward of owning this company could pay off in the coming years. The last time I spoke of this company was back on Sunday July 11th. The stock closed at $0.83 Friday July 9th. From the day I recommended the stock it has moved from $0.83 to $1.03. That's roughly a 24% return over a 3 month period. Just a few days earlier than my recommendation on Wednesday July 9th the stock closed at $0.68. If you had bought the stock 2 days earlier you would have a 51.4% gain. That's huge!
Sometimes speculation pays off and in this case it's working for Cosi investors. I know some of my readers own Cosi and I want to congratulate them for a huge gain on Friday. Cosi was and still is a great speculative investment. Cosi's continuous improvement will not go unnoticed by the micro cap investors. Cosi reports their earnings on Nov 11th and I'm eager to hear what they have to say.
I see big things happening for Cosi in the future! This speculative company could eventually turn into a solid investment.
Remember next week is a big week for stocks as earnings season continues. I mentioned my favorites on Thursday and I left out Caterpillar (CAT). I must have been low on caffeine at the time! CAT reports on Thursday 10/21/10. I expect nothing less than a solid qtr. The Peoria Powerhouse is firing on all cylinders!
Have a great week!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
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Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
Cosi (COSI) is very speculative, but the reward of owning this company could pay off in the coming years. The last time I spoke of this company was back on Sunday July 11th. The stock closed at $0.83 Friday July 9th. From the day I recommended the stock it has moved from $0.83 to $1.03. That's roughly a 24% return over a 3 month period. Just a few days earlier than my recommendation on Wednesday July 9th the stock closed at $0.68. If you had bought the stock 2 days earlier you would have a 51.4% gain. That's huge!
Sometimes speculation pays off and in this case it's working for Cosi investors. I know some of my readers own Cosi and I want to congratulate them for a huge gain on Friday. Cosi was and still is a great speculative investment. Cosi's continuous improvement will not go unnoticed by the micro cap investors. Cosi reports their earnings on Nov 11th and I'm eager to hear what they have to say.
I see big things happening for Cosi in the future! This speculative company could eventually turn into a solid investment.
Remember next week is a big week for stocks as earnings season continues. I mentioned my favorites on Thursday and I left out Caterpillar (CAT). I must have been low on caffeine at the time! CAT reports on Thursday 10/21/10. I expect nothing less than a solid qtr. The Peoria Powerhouse is firing on all cylinders!
Have a great week!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
Feedback Welcome!
Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
Thursday, October 14, 2010
Earnings Season Off To A Great Start. Google Is Back On The Saddle!
I’m back! My Internet was fixed today. Something about the frequency wasn’t in the proper range to pick up the signal. I’m glad to be back in action!
Google jeez! Nice job on a blowout quarter!
Well folks earnings season is back better than ever. Some of the larger companies have already reported their earnings. JP Morgan (JPM) and Intel (INTC) were just a couple of recent out performers that reported better than expected earnings earlier this week. Intel basically saved itself from being cut from the stock prediction game. This stock has performed poorly, but after their recent earnings I believe this stock will be just fine. JP Morgan had some bright points, however from the recent worries about the mortgage mishap with the foreclosure papers the banks have been receiving an extreme amount of pressure. This debacle could cost the banks billions of dollars. With that being said even if the banks report good earnings over the next couple of weeks I would steer clear for awhile until the smoke clears.
Next let's move onto Google. This is my first time mentioning this company and it won't be the last. What a spectacular showing by Google (GOOG) reporting a great number after the bell today. Google destroyed analysts estimates for this quarter. Analysts were expecting $6.69 a share. Google had an upward surprise of $7.64 a share excluding items. This company is making some money! To top it off they added more than 1,500 employees in the 3rd qtr. Adding jobs and making more money now that's a recipe for success. Maybe the government should take a few lessons from the likes of Google. I plan on doing some more research on Google so stay tuned. This company is definitely worth a look. Please don’t buy this stock tomorrow as it has already run up 9% in after hours. You will lose money!
Next on deck we have my following favorites reporting next Tuesday
Apple (AAPL) Tuesday 10/19/10 Apple shouldn’t have a problem topping estimates and should get a nice pop tomorrow from Google’s recent earnings. Don’t be surprised if this stock sells off after they report earnings. Apple has had a great run. There will be profit taking!
Weatherford International (WFT) Tuesday 10/19/10 Similar to Apple, Weatherford has run up quite nicely up 26% from 3 months ago. Earnings should be just fine and some profit taking will take place. Wait until the selling is done and buy some 5-10% lower.
In closing I would like to give a few words of advice. We as individuals work very hard for our money. I say take some pressure off and let great companies like Apple and Caterpillar do the heavy lifting. Large companies generate tons of money and they give us a perfect opportunity to benefit from their success by investing in their stock. It’s as simple as that!
Have a great night!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
Feedback Welcome!
Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
Google jeez! Nice job on a blowout quarter!
Well folks earnings season is back better than ever. Some of the larger companies have already reported their earnings. JP Morgan (JPM) and Intel (INTC) were just a couple of recent out performers that reported better than expected earnings earlier this week. Intel basically saved itself from being cut from the stock prediction game. This stock has performed poorly, but after their recent earnings I believe this stock will be just fine. JP Morgan had some bright points, however from the recent worries about the mortgage mishap with the foreclosure papers the banks have been receiving an extreme amount of pressure. This debacle could cost the banks billions of dollars. With that being said even if the banks report good earnings over the next couple of weeks I would steer clear for awhile until the smoke clears.
Next let's move onto Google. This is my first time mentioning this company and it won't be the last. What a spectacular showing by Google (GOOG) reporting a great number after the bell today. Google destroyed analysts estimates for this quarter. Analysts were expecting $6.69 a share. Google had an upward surprise of $7.64 a share excluding items. This company is making some money! To top it off they added more than 1,500 employees in the 3rd qtr. Adding jobs and making more money now that's a recipe for success. Maybe the government should take a few lessons from the likes of Google. I plan on doing some more research on Google so stay tuned. This company is definitely worth a look. Please don’t buy this stock tomorrow as it has already run up 9% in after hours. You will lose money!
Next on deck we have my following favorites reporting next Tuesday
Apple (AAPL) Tuesday 10/19/10 Apple shouldn’t have a problem topping estimates and should get a nice pop tomorrow from Google’s recent earnings. Don’t be surprised if this stock sells off after they report earnings. Apple has had a great run. There will be profit taking!
Weatherford International (WFT) Tuesday 10/19/10 Similar to Apple, Weatherford has run up quite nicely up 26% from 3 months ago. Earnings should be just fine and some profit taking will take place. Wait until the selling is done and buy some 5-10% lower.
In closing I would like to give a few words of advice. We as individuals work very hard for our money. I say take some pressure off and let great companies like Apple and Caterpillar do the heavy lifting. Large companies generate tons of money and they give us a perfect opportunity to benefit from their success by investing in their stock. It’s as simple as that!
Have a great night!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
Feedback Welcome!
Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
Sunday, October 10, 2010
Thursday, October 7, 2010
Making Money Trend
Since Monday all the market indices are in the green. Today was a bit of a slowdown awaiting the infamous monthly non farm payrolls. I’m feeling pretty good about tomorrow’s jobs report.
Yes stocks tend to sell off the day before a big economic report, but it’s exactly how the big money managers play the game. They lighten up a bit on their winners awaiting the news. If the news is positive (which I think it will be), they will gradually work their way back into their favorite stocks.
From the recent upward trend in stocks I believe the outlook in jobs has turned to the upside. Weekly jobless claims have been gradually dropping in recent weeks and this has given the stock market a boost to the upside. Even if the non farm payrolls is positive tomorrow invest with caution. Remember this saying “Buy on rumor” “Sell on the news” Investing is counterintuitive. When everyone one is selling the smart investors are buying stocks at great prices to position themselves for a hefty profit. When everyone is buying the bulk of the money has already been made and the smart money is gradually selling into the strength on the positive news. Never chase a stock when it’s up big! Never! Be patient and buy on a down day.
This stock market has surprised me over the past few months and I believe stocks will continue to move higher throughout earnings season. The volume always increases and more investors pay attention to their stocks. They pay attention to ensure the companies they invested their hard earned money continue to outperform. For this earnings season pay attention to the winners and sit back and take advantage of the short term moves upward. Earnings time is a great way to find new companies to invest in. Wait until all the earnings noise subsides and invest a couple weeks after the company you would like to invest in reports it’s earnings. I’ve seen the same trend over and over. A company reports great earnings and the stock surges higher for a couple of days and then comes right back down a week or two later. Humans are very emotional and people get too excited when they should be doing just the opposite.
Well that’s it for me. Stocks have been great! I’m definitely a bull in this market. I have no complaints. The positive trend will continue with a good payroll number tomorrow. Sleep easy!
P.S- Kinder Morgan (KMP) broke its 52 week high. Another one of my favorite stocks that has MONSTER STATUS written all over it! It pays a nice juicy 6.30% Dividend. It’s a glorified toll road for oil.
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
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Yes stocks tend to sell off the day before a big economic report, but it’s exactly how the big money managers play the game. They lighten up a bit on their winners awaiting the news. If the news is positive (which I think it will be), they will gradually work their way back into their favorite stocks.
From the recent upward trend in stocks I believe the outlook in jobs has turned to the upside. Weekly jobless claims have been gradually dropping in recent weeks and this has given the stock market a boost to the upside. Even if the non farm payrolls is positive tomorrow invest with caution. Remember this saying “Buy on rumor” “Sell on the news” Investing is counterintuitive. When everyone one is selling the smart investors are buying stocks at great prices to position themselves for a hefty profit. When everyone is buying the bulk of the money has already been made and the smart money is gradually selling into the strength on the positive news. Never chase a stock when it’s up big! Never! Be patient and buy on a down day.
This stock market has surprised me over the past few months and I believe stocks will continue to move higher throughout earnings season. The volume always increases and more investors pay attention to their stocks. They pay attention to ensure the companies they invested their hard earned money continue to outperform. For this earnings season pay attention to the winners and sit back and take advantage of the short term moves upward. Earnings time is a great way to find new companies to invest in. Wait until all the earnings noise subsides and invest a couple weeks after the company you would like to invest in reports it’s earnings. I’ve seen the same trend over and over. A company reports great earnings and the stock surges higher for a couple of days and then comes right back down a week or two later. Humans are very emotional and people get too excited when they should be doing just the opposite.
Well that’s it for me. Stocks have been great! I’m definitely a bull in this market. I have no complaints. The positive trend will continue with a good payroll number tomorrow. Sleep easy!
P.S- Kinder Morgan (KMP) broke its 52 week high. Another one of my favorite stocks that has MONSTER STATUS written all over it! It pays a nice juicy 6.30% Dividend. It’s a glorified toll road for oil.
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
Feedback Welcome!
Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
Sunday, October 3, 2010
A Positive Spin On Your 401k
Investing in your 401K is essential. I mentioned this before that everyone should be taking advantage of their 401K program at work. And I mean everyone! If you have a 401K program you may already know that it has many great advantages to offer.
1. Tax deferred. You don't have to pay taxes on your contributions until you retire.
2. 401K reduces your taxable income. This could potentially put you in a lower tax bracket.
3. Employer match. The majority of employers will match .50 on every $1.00 of contribution up to 6% of your annual salary. (Plans may vary)
4. 401K money comes right out of your check. You never see the money and its a great way to force yourself to invest for your future.
These 4 examples definitely support the advantages of investing in your 401K program. I would like to add another advantage that is straight up mind blowing! (The only catch is your employer must match your contributions)
Investing in your 401K is essentially a hidden raise from your employer. Everyone wants a raise. Right? Here is a perfect opportunity for a raise and you don't even have to be a standout employee at your work. I will explain. Get ready!
Example:
Your current salary is $48,000 and your employer matches .50 for every $1.00 up to 6% of your annual salary.
- 6% of your salary is $2,880. That means your employer will contribute up to $1,440 a year.
-Add that $1,440 to your $48,000 and you just received a 3% raise. That's the easiest 3% you will ever earn.
-You may argue that you are decreasing your annual income by $2,880 since that is what you must contribute to take advantage of the match from your employer. You are correct! The raise is being deposited into your retirement account. Your technically not losing any money. You are moving your money to an account that cannot be used until retirement. You are getting a raise that has delayed gratification written all over it! Now check out these numbers! The numbers below provide the evidence behind a once in a lifetime raise. A phenomenal deal by your employer that you can't refuse!
-Next we will take the $1,440 that your employer matched from your $2,880 contribution and invest it in the stock market for 30 yrs. (You could have multiple employers over the 30 yrs)
-I like to use a 12% return as this is roughly what the S&P 500 has returned historically.
-Take the $1,440 contributed for 30 yrs at a 12% rate of return and you get $389,221.35. (Total contribution of $43,200 from your employer.)
-Now take the $389,221.35 and divide by 30. You get roughly $12,974
Your employer just gave you a $12,974 raise over 30 years. Add that to your $48,000 annual salary and your new salary is $60,974. I call this the delayed gratification raise! I'll take that raise all day long!
So in the end your 3% delayed raise from your employer turned out to actually be a 27% raise!
12,974/48,000 = .27 or 27% My suggestion to all is to go into work Monday morning and give yourself a 27% delayed gratification raise. You deserve it!
I'm not done just yet! While your employer was contributing $1,440 you were also putting in $2,880 a year.
That means over 30 yrs you were actually contributing $4,320 a year. Invest that number at 12% for 30 yrs. and you just became a Millionaire! It's that simple.
-Over 30 yrs you would have accumulated roughly $1,167,664.06
It's true everyone can become a Millionaire! The secret formula is a 401K + Time = Millionaire!
Happy Sunday!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
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Occasional Stock Market Commentary during the week.
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1. Tax deferred. You don't have to pay taxes on your contributions until you retire.
2. 401K reduces your taxable income. This could potentially put you in a lower tax bracket.
3. Employer match. The majority of employers will match .50 on every $1.00 of contribution up to 6% of your annual salary. (Plans may vary)
4. 401K money comes right out of your check. You never see the money and its a great way to force yourself to invest for your future.
These 4 examples definitely support the advantages of investing in your 401K program. I would like to add another advantage that is straight up mind blowing! (The only catch is your employer must match your contributions)
Investing in your 401K is essentially a hidden raise from your employer. Everyone wants a raise. Right? Here is a perfect opportunity for a raise and you don't even have to be a standout employee at your work. I will explain. Get ready!
Example:
Your current salary is $48,000 and your employer matches .50 for every $1.00 up to 6% of your annual salary.
- 6% of your salary is $2,880. That means your employer will contribute up to $1,440 a year.
-Add that $1,440 to your $48,000 and you just received a 3% raise. That's the easiest 3% you will ever earn.
-You may argue that you are decreasing your annual income by $2,880 since that is what you must contribute to take advantage of the match from your employer. You are correct! The raise is being deposited into your retirement account. Your technically not losing any money. You are moving your money to an account that cannot be used until retirement. You are getting a raise that has delayed gratification written all over it! Now check out these numbers! The numbers below provide the evidence behind a once in a lifetime raise. A phenomenal deal by your employer that you can't refuse!
-Next we will take the $1,440 that your employer matched from your $2,880 contribution and invest it in the stock market for 30 yrs. (You could have multiple employers over the 30 yrs)
-I like to use a 12% return as this is roughly what the S&P 500 has returned historically.
-Take the $1,440 contributed for 30 yrs at a 12% rate of return and you get $389,221.35. (Total contribution of $43,200 from your employer.)
-Now take the $389,221.35 and divide by 30. You get roughly $12,974
Your employer just gave you a $12,974 raise over 30 years. Add that to your $48,000 annual salary and your new salary is $60,974. I call this the delayed gratification raise! I'll take that raise all day long!
So in the end your 3% delayed raise from your employer turned out to actually be a 27% raise!
12,974/48,000 = .27 or 27% My suggestion to all is to go into work Monday morning and give yourself a 27% delayed gratification raise. You deserve it!
I'm not done just yet! While your employer was contributing $1,440 you were also putting in $2,880 a year.
That means over 30 yrs you were actually contributing $4,320 a year. Invest that number at 12% for 30 yrs. and you just became a Millionaire! It's that simple.
-Over 30 yrs you would have accumulated roughly $1,167,664.06
It's true everyone can become a Millionaire! The secret formula is a 401K + Time = Millionaire!
Happy Sunday!
Clay-
Have a Question? Send Questions to wheatleycsmk@gmail.com
New Content every Thursday and Sunday.
Occasional Stock Market Commentary during the week.
Feedback Welcome!
Interested? Please become a follower (This gives me an accurate number of readership) I would like to see this number grow! Click the follow button on the right hand side of the screen and follow the prompts. It's easy!
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