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Company name Broadcom Corporation
Stock ticker BRCM
Live stock price [stckqut]BRCM[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

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

ANALYSIS

Confident Investor Rating Good
Target stock price (TWCA growth scenario) $56.01
Target stock price (averages with growth) $94.6
Target stock price (averages with no growth) $89.96
Target stock price (manual assumptions) $50.6

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

Broadcom Corporation (Broadcom) is a global semiconductor solution for wired and wireless communications. Broadcom products deliver voice, video, data and multimedia connectivity in the home, the office and the mobile environment. The Company provides system-on-a-chip (SoC) and software solutions. The Company operates in three segments: Broadband Communications, Mobile & Wireless, and Infrastructure & Networking. Broadband Communications (solutions for the home) provides solutions for cable, x digital subscriber line (xDSL), fiber, satellite and Internet protocol (IP) broadband networks to enable the connected home, including set-top-boxes and media servers, residential modems and gateways, femtocells and wired home networking solutions. In April 2011, the Company acquired Provigent Inc. In May 2011, it acquired SC Square Ltd. In February 2012, the Company acquired NetLogic Microsystems, Inc. In April 2012, it acquired BroadLight, Inc.

 

Confident Investor comments: It is very rare for a company to have this much green on my analysis. At this price and at this time, I think that a Confident Investor can confidently invest in this stock.

 

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As regular readers know, I am not a pure lover of P/E ratios. I am frequently concerned that companies are passed over by investors due to some silly belief that an investment’s P/E is too high. This ratio has little usefulness when comparing companies that are in separate industries. P/E is typically a signal of the growth rate of the company, a higher growth rate should earn a higher P/E. So unless you only invest in one type of company e.g. software companies, you need to be very concerned about comparing P/E ratios between industries.

That said, I recently read a very short article on Crossing Wall Street that pointed out an interesting fact. According to the article and the chart, the P/E ratio of the S&P 500 is below the norm for 1991-2010. There are a few brief exceptions to this.

This tells us that the stock market is likely NOT at its peak. While individual companies will go down, in general the market is healthy and investors should continue to use stocks as a major portion of their portfolio.

I am re-posting the excellent stock chart comparison however I didn’t create it and it was originally found on Crossing Wall Street.  I claim no rights to this image.

Historic S&P 500 P/E ratio compared to current P/E ratio

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

MANAGEMENT EXECUTION

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

ANALYSIS

Confident Investor Rating Good
Target stock price (TWCA growth scenario) $231.64
Target stock price (averages with growth) $329.84
Target stock price (averages with no growth) $286.73
Target stock price (manual assumptions) $218.56

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

BlackRock, Inc. (BlackRock) is an independent investment management firm. The Company provides a range of investment and risk management services. The Company serves its clients as a fiduciary, and derives all of its revenues from client business. It invests in capital markets globally. Its clients include taxable, tax-exempt and official institutions (including pension funds, endowments, insurance companies, corporations, financial institutions, central banks and sovereign wealth funds) as well as retail investors and high net worth individuals. Its product range includes single- and multi-asset class portfolios investing in equities, fixed income, alternatives and/or money market instruments. It offer its products directly and through intermediaries in a range of vehicles, including open-end and closed-end mutual funds, iShares exchange-traded funds (ETFs) and other exchange-traded products ( ETPs). In March 2012, it acquired Claymore Investments, Inc. from Guggenheim Partners, LLC.

 

Confident Investor comments: At this price and at this time, I think that a Confident Investor can confidently invest in this stock.

 

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Company name Balchem Corporation
Stock ticker BCPC
Live stock price [stckqut]BCPC[/stckqut]
P/E compared to competitors Fair

MANAGEMENT EXECUTION

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

ANALYSIS

Confident Investor Rating Good
Target stock price (TWCA growth scenario) $47.17
Target stock price (averages with growth) $54.66
Target stock price (averages with no growth) $39.44
Target stock price (manual assumptions) $45.46

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

Balchem Corporation (Balchem) is engaged in the development, manufacture and marketing of specialty performance ingredients and products for the food, nutritional, feed, pharmaceutical and medical sterilization industries. The Company has three reportable segments: Specialty Products, Food, Pharma & Nutrition, and Animal Nutrition & Health. The Company sells its products through its own sales force, independent distributors and sales agents. The Company operates five wholly owned domestic subsidiaries, such as BCP Ingredients, Inc., Aberco, Inc., Balchem BV, Balchem Trading BV and Balchem Italia Srl. The Food, Pharma & Nutrition (FPN) segment provides microencapsulation solutions to a variety of applications in food, pharmaceutical and nutritional ingredients to enhance performance of nutritional fortification, processing, mixing, and packaging applications and shelf-life. Balchem’s Specialty Products segment operates in industry as ARC Specialty Products.

 

Confident Investor comments: At this price and at this time, I think that a Confident Investor can confidently invest in this stock.

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

MANAGEMENT EXECUTION

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

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $62.84
Target stock price (averages with growth) $79.24
Target stock price (averages with no growth) $57.95
Target stock price (manual assumptions) $62.08

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

Atwood Oceanics, Inc., along with its subsidiaries, is engaged in the international offshore drilling contractor engaged in the drilling and completion of exploratory and developmental oil and gas wells. As of September 30, 2011, the Company owned a fleet of 10 mobile offshore drilling units located in the United States Gulf of Mexico, South America, the Mediterranean Sea, West Africa, Southeast Asia and Australia. During the fiscal year ended September 30, 2011 (fiscal 2011), it had a utilization rate of 95%. Its offshore drilling equipments include semisubmersible rigs, jack-up drilling rigs, semisubmersible tender assist rigs and submersible drilling rigs. It obtains the contracts, under which it operates its units either through individual negotiation with the customer or by submitting proposals in competition with other contractors. In October 2010, it entered into turnkey construction agreements with PPL Shipyard PTE LTD to construct two Pacific Class 400 jack-up drilling units.

 

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in this stock as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns. I am taking the stock off of my Watch List although I may continue to hold a position in the stock as long as the price holds.