Company name Molina Healthcare, Inc.
Stock ticker MOH
Live stock price [stckqut]MOH[/stckqut]
P/E compared to competitors Fair

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Good
EPS growth Poor
P/E growth Good
EBIT growth Poor

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $43.13
Target stock price (averages with growth) $65.19
Target stock price (averages with no growth) $52.44
Target stock price (manual assumptions) $42.49

The following company description is from Google Finance: http://www.google.com/finance?q=moh

Molina Healthcare, Inc. provides medicaid-related solutions. The Company operates in two segments: Health Plans and Molina Medicaid Solutions. Its Health Plans segment consists of health plans in California, Florida, Michigan, New Mexico, Ohio, Texas, Utah, Washington, and Wisconsin, and includes the Company’s direct delivery business. Its Molina Medicaid Solutions segment provides design, development, implementation, and business process outsourcing solutions to state governments for their Medicaid Management Information Systems (MMIS).As of December 31, 2012, Health Plans segment served approximately 1.8 million members eligible for Medicaid, Medicare, and other government-sponsored health care programs for low-income families and individuals. In June 2013, Molina Healthcare Inc announced that, through its wholly owned subsidiary, Molina Center LLC, it has successfully completed a sale and lease back transaction with the dedicated net lease group of Angelo, Gordon & Co (AG).

 

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in Molina Healthcare, Inc. as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $34.71

Growth: 0.15

Current EPS (TTM): $1.62

P/E: 21

Future EPS Calc: $3.25

Future Stock Price Calc: $68.42

Target stock price: $42.48

I hope that this makes you a better investor. [/s2If]

ID-10044378There are a few things that every investor can do to help ease the process of saving for retirement. Here are 10 activities to help with retirement planning.

1. Start investing early

The earlier you start saving; the more compound interest can working for you. For each year you delay saving, the higher your monthly contribution will need to be to achieve the same targeted amount. The law of compound interest shows that starting in your 20s means it will be a lot easier to be wealthy; however, if you are just getting started – don’t despair.

2. Make additional savings

Whenever you save on a major expenditure, you should put part of that savings into your retirement. Get in the habit of putting half of the savings on the “great deal” at the store into your retirement account. If the recliner is $100 off this month, put $50 into your long-term savings account. This will help to reduce impulse purchases on “great deals” and it will also help you grow your savings even more quickly.

3. Keep up with inflation

Your monthly contribution to your retirement account will diminish in real terms over time if you don’t adjust your contributions in line with inflation. This will result in you contributing less than you think you. Investing more, as well as investing slightly more aggressively, could lead to an even higher return over time.

4. Expose yourself to growth assets

To keep pace with inflation, you will need a certain allocation in growth assets, such as equities, in your portfolio – even post-retirement. I advise people to follow the investment strategies of my book, The Confident Investor, well into their 70s if not 80s. Assume you will outlive the oldest person that you know right now.

5. Diversify

While the majority of your income should be in direct equities using my Watch List as a guide, you should have 20-40% of your portfolio in index funds. These index funds should be a small cap, large cap, bond, and international.

6. Stick to your investment strategy

I strongly suggest that you follow my Grow on Other People’s Money strategy. However, if you don’t feel comfortable with that strategy, find one that works for you and stick with it. Nothing will destroy your portfolio more than panic selling.

7. Look after your health

You should prioritise health and medical care when saving for retirement as medical costs can form a large percentage of a retiree’s spending. It’s well documented that medical inflation is much higher than general inflation. Nothing is enjoyable without health, so staying active and doing everything you can to stay healthy should be a priority at any age.

8. Keep active and interested in life

Retirement options aren’t what they used to be. These days retirees are opting to start new businesses and even further their studies. These activities can give meaning and purpose to your golden years while allowing you to continue playing a role in the economy. The message is clear – don’t stop planning, working or dreaming.

9. Read about the market

You have already started this habit if you are reading this site. Read my book as well and other books on investments. You should never stop learning.

10. Take responsibility

No one said it was going to be easy. But you can do a lot for yourself by taking an active interest in your investments, reading and staying up to date on the markets. Products change and sometimes investment views change too. So be informed, ask questions and take control of your future, starting today.

Image courtesy of Ambro at FreeDigitalPhotos.net

Company name FLIR Systems, Inc.
Stock ticker FLIR
Live stock price [stckqut]FLIR[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Poor
EPS growth Fair
P/E growth Poor
EBIT growth Poor

ANALYSIS

Confident Investor Rating Poor
Target stock price (TWCA growth scenario) $22.62
Target stock price (averages with growth) $34.73
Target stock price (averages with no growth) $35.37
Target stock price (manual assumptions) $24.92

The following company description is from Google Finance: http://www.google.com/finance?q=flir

FLIR Systems, Inc. (FLIR), is a designer, manufacturer, and marketer of thermal imaging systems. The Company’s advanced sensors and integrated sensor systems enable the gathering and analysis of critical information through a range of applications in commercial, industrial, and government markets worldwide. Its business is organized into two divisions: Commercial Systems and Government Systems. Commercial Systems division includes Thermal Vision & Measurement and Raymarine. Government Systems division include Surveillance, Detection, and Integrated Systems. It offers a range of sensor products, including infrared imaging cameras and systems, detector cores, CBRNE threat detectors, test and measurement instruments, radars, maritime electronics, and related products and solutions. In August 2013, Tessera Technologies Inc announced that FLIR Systems, Inc. acquired a portion of the assets of Tessera’s Micro-Optics business based in Charlotte, North Carolina.

 

Confident Investor comments: At this price and at this time, I do not think that a Confident Investor can confidently invest in FLIR Systems, Inc..

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $28.54

Growth: 0.07

Current EPS (TTM): $1.59

P/E: 18

Future EPS Calc: $2.23

Future Stock Price Calc: $40.14

Target stock price: $24.92

I hope that this makes you a better investor. [/s2If]

Company name CBIZ, Inc.
Stock ticker CBZ
Live stock price [stckqut]CBZ[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Poor
Sales growth Poor
EPS growth Poor
P/E growth Poor
EBIT growth Poor

ANALYSIS

Confident Investor Rating Poor
Target stock price (TWCA growth scenario) $5.87
Target stock price (averages with growth) $6.43
Target stock price (averages with no growth) $6.74
Target stock price (manual assumptions) $3.51

The following company description is from Google Finance: http://www.google.com/finance?q=cbz

CBIZ, Inc. (CBIZ) provides professional business services, products and solutions. These services are provided to businesses of various sizes, as well as individuals, governmental entities and not-for-profit enterprises throughout the United States and parts of Canada. CBIZ delivers its services through four practice groups: Financial Services, Employee Services, and National Practices. Its Financial Services group includes accounting, tax, financial advisory, valuation, litigation support, internal audit, family office services, fraud detection and real estate advisory. Its Employee Services group provides group health, property and casualty, retirement planning, payroll services, life insurance, human capital management, compensation consulting, recruiting and actuarial services. In September 2013, CBIZ, Inc completed the sale of its Medical Management Professionals (MMP) business to Zotec Partners, LLC.

 

Confident Investor comments: At this price and at this time, I do not think that a Confident Investor can confidently invest in this stock.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $7.89

Growth: 0.04

Current EPS (TTM): $0.58

P/E: 8

Future EPS Calc: $0.7

Future Stock Price Calc: $5.64

Target stock price: $3.5

I hope that this makes you a better investor. [/s2If]

ID-10099202Most people that I speak to regarding investing strategies will tell me about their employer stock program. Using this program, you are investing in your employer at a discount from the market rates.

A typical employer investment program will allow you to save a portion of your after-tax regular paycheck into a special fund. This is a great strategy as it allows you to pay yourself first before any other bills are paid. I applaud this type of program! However, doing this doesn’t make investing in your employer a great deal.

The second step of the investment program that provides investing in your employer will vary somewhat from employer to employer. Typically, the employer selects a period of time of either 3-months or 6-months. The value of the stock to be purchased is determined by either the lowest of either the start or the end of the period. In some cases, I have heard that the average of the start and end are used. The employer may elect to give a discount from that price, as well. The discount can be 10% or 15%.

This can make investing in your employer seem like a great deal. You have an automatic savings program that allows you to buy at the best price over a period of time. The employer may have even subsidized the investment which further increases your profit.

Unfortunately, this is where the good habits tend to stop. I have seen people that use this type of program develop an effective portfolio where 20-40% of their portfolio is in their employer. This is way too high for any single company and even worse for your employer. Remember, you are already investing your time every week in that company. They are providing 100% of your income.

Think of your paycheck as a dividend check based on your labor. You are investing your daily work time into that company, and in return you are receiving a dividend check for that effort. Under that scenario, your employer already plays an extremely large portion of your portfolio. By investing in the company as well, you are committing an outlandish portion of your net worth to one investment.

So what is the solution to investing in your employer?

If your employer is subsidizing the program by discounting the purchase by at least 5%, you should participate. Investing in your employer for the short term will then make good economic sense. However, once the investment in your employer reaches 5% of your portfolio, you need to start liquidating the stock. You could do this on a LIFO (Last In First Out) basis and immediately sell the stock you just bought at a discount. You could also do it on a FIFO (First In First Out) basis and sell the shares you first accumulated in the program.

Avoid investing too much in the stock of any company that you currently work for. You are essentially doubling your risk. Should something go wrong with the company, you are looking at losing both your investment and paycheck at the same time. Although, if employee shares can be purchased at discount, it might be a good bargain and worth purchasing. While it is fine to support your company by purchasing stock, you do not want your portfolio to consist mainly of that one investment. When you put all your faith in one stock and it does not perform at the level you expected, you can end up losing all or most of your investment as the price of the stock falls or if a company goes out of business. This is even more painful if you lose your job, as well.

Image courtesy of smarnad at FreeDigitalPhotos.net