By:
On:
In: Good company, Stock analysis
Tagged:
With: 0 Comments

Company name Ascena Retail Group Inc
Stock ticker ASNA
Live stock price [stckqut]ASNA[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

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

ANALYSIS

Confident Investor Rating Good
Target stock price (TWCA growth scenario) $24.58
Target stock price (averages with growth) $29.89
Target stock price (averages with no growth) $20.69
Target stock price (manual assumptions) $24.23

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

Ascena Retail Group, Inc. (Ascena) is a national specialty retailer of apparel for women and tween girls operating, through its wholly owned subsidiaries, the dressbarn, maurices, and Justice brands. As of July 28, 2012, the Company operated over 3,800 stores throughout the United States, Puerto Rico and Canada. Ascena operates under three brands: dressbarn, maurices and Justice. In January 2011, the Company completed an internal corporate reorganization and established a holding company, Ascena Retail Group, Inc. In June 14, 2012, the Company acquired Charming Shoppes, Inc., an apparel retailer specializing in women’s plus-size apparel.

 

Confident Investor comments: At this price and at this time, I 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.

By:
On:
In: Commentary
Tagged:
With: 0 Comments

I don’t try to predict why a stock is going up based on market conditions. That strategy is simply fraught with danger that I try to avoid.

I frequently get emails, comments on my site, or Twitter questions regarding my opinion on a particular news story. The questioner is almost always asking for my opinion on the news’ affect on a certain stock.

I strongly urge investors to not worry about such details. I realize that Jim Cramer of Mad Money will often discuss the reaction of a stock to a news item. As a case in point, Mr. Cramer recently tweeted on news of gasoline prices potentially dropping and its influence on the retail segment. Jim is incredibly smart and immensely popular. I enjoy watching his television shows. However, I think that using this information to control your investment is unwise for the individual investor.

As I pointed out in an earlier article, the influence of the news on a particular stock is typically extremely short lived. There was a recent study by an analyst  firm that looked at the help wanted ads for Microsoft [stckqut]MSFT[/stckqut] in order to get an insight into Microsoft’s focus for development. I laughed when I saw that story. The recruitment process by a company has nothing to do with the immediate quarterly success of the company. The long-term success of the company obviously depends on its future investments (which I wrote about here) but to try to predict the success of the company based on who they are going to hire in the short-term is giving far too much omniscience to the analysts doing the study.

I honestly do not think that it is necessary to make such deep analysis to be successful. As I teach in my book, The Confident Investor, most of the analysis can be reduced to a 10-year analysis on 4 different metrics combined with a current analysis of two more metrics. This gives you the capability of finding truly exceptional companies. You should grow your investment in those Good Companies using technical trading tools that control your trades.

It is entertaining and educational to listen to Jim Cramer explain how the various macro factors affect a company or an industry. I am sure that he is often correct. However, I don’t suggest that the individual investor repeats this effort.

You can purchase my book wherever books are sold such as Amazon, Barnes and Noble, and Books A Million. It is available in e-book formats for Nook, Kindle, and iPad.

By:
On:
In: Good company, Stock analysis
Tagged:
With: 0 Comments

Company name Atlas Pipeline Partners, L.P.
Stock ticker APL
Live stock price [stckqut]APL[/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) $55.06
Target stock price (averages with growth) $51.35
Target stock price (averages with no growth) $25.89
Target stock price (manual assumptions) $47.35

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

Atlas Pipeline Partners, L.P. is a provider of natural gas gathering and processing services in the Anadarko and Permian Basins located in the southwestern and mid-continent regions of the United States; a provider of natural gas gathering services in the Appalachian Basin in the northeastern region of the United States and a provider of natural gas liquid (NGL) transportation services in the southwestern region of the United States. Its general partner, Atlas Pipeline Partners GP, LLC (Atlas Pipeline GP), manages its operations and activities through its ownership of its general partner interest. Atlas Pipeline GP is a wholly owned subsidiary of Atlas Energy, L.P, as well as the 2% general partner interest. The Company conducts its business in the midstream segment of the natural gas industry through two segments: Gathering and Processing and Pipeline Transportation. On December 1, 2012, the Company acquired Cardinal Midstream, LLC.

 

Confident Investor comments: At this price and at this time, I 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.
 

By:
On:
In: Good company, Stock analysis
Tagged:
With: 0 Comments

Company name ANSYS, Inc.
Stock ticker ANSS
Live stock price [stckqut]ANSS[/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) $101.22
Target stock price (averages with growth) $129.6
Target stock price (averages with no growth) $94.09
Target stock price (manual assumptions) $101.96

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

ANSYS, Inc. (ANSYS) develops and globally markets engineering simulation software and services used by engineers, designers, researchers and students across a range of industries and academia, including aerospace, automotive, manufacturing, electronics, biomedical, energy and defense. The Company distributes its ANSYS suite of simulation technologies through a global network of independent resellers and distributors (collectively, channel partners) and direct sales offices in global locations. The Company’s product portfolio consists of ANSYS Workbench, multiphysics product, structural mechanics, fluid dynamics, explicit dynamics, electromagnetic, system simulation, simulation process and data management, academic, high-performance computing (HPC), geometry interfaces, meshing and Apache design low-power electronic solutions. On August 1, 2011, the Company acquired Apache Design, Inc. In April 2013, it acquired EVEN – Evolutionary Engineering AG.

 

Confident Investor comments: At this price and at this time, I 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.
 

By:
On:
In: Commentary
With: 0 Comments

Most of the stock that is traded on the market is bought and sold by large institutional investors. At some point in the future, I will explain those ominous institutional investors and why they exist and where they get their money. If you want get an update when that article is published, you can simply follow me on Twitter at @ConfidentInvest, subscribe to my RSS feed, or subscribe to my weekly aggregation newsletter.

These institutional investors are not immune from the herd mentality of the market. In fact, they often drive it! They tend to be very susceptible to market analysts that put a rating on a particular stock such as Buy, Hold, Sell (or one of the other less obvious ratings). They also tend to give a lot of credence to target market pricing that is published by analysts.

The biggest disadvantage of the large institutional investors is simply their size! Their second disadvantage is their report to their investors. A quick discussion of these two points is relevant:

  1. One of the largest investment funds (i.e. mutual fund) is The Growth Fund of America (AGTHX). This fund has approximately 115 BILLION dollars under management!  This is larger than the GDP of a small country like Bangladesh or Morocco! When the fund managers are working with a portfolio this large they have massive investments in any one stock. In fact, according to their 2012 Annual Report their largest holding was $4.8B in Apple [stckqut]AAPL[/stckqut] and now, according to their site, Apple doesn’t make the top ten. When the managers liquidated this stock, they didn’t do it in one order – they had to do it over time. In fact, it is possible that the liquidation of this stock actually drove the stock price down so as they sold more shares, they were selling at lower and lower prices.
  2. The second point that is a disadvantage to mutual fund operators is the focus they get on publishing their largest holdings. If you saw a fund that had 5% of its money in Apple over the last 3-4 months wouldn’t you question the manager’s logic? This means that they are constantly under scrutiny on their top investments. A potential investor may disqualify AGTHX if they see Apple at the top of the list. The manager may think that it is time to buy Apple but the risk of the holdings report means that the investment has to be considered wise within the reporting period of the fund.

The advantage to you, an individual investor, is that you can quickly and efficiently buy or sell stock in any company. You can also take advantage of the herd mentality of the entire investment community: you can buy stocks when they have irrationally been beaten down too low, and you can sell them when market exuberance has overpriced a company.

As a small investor, you will not move the market no matter what you do, so you can remain calm and analyze each company to determine the best price to sell and the best price to buy. Your personal moves will not be noticed and start a run on any company. You can quietly and efficiently make your profit.

The key thing to remember is that, when you buy a stock, you may pay too much or you may get an excellent deal. It is only through analysis and research that you can make that determination. It is also essential to remember that most stocks are appropriately priced and will not be a bargain. You will need to be patient to find companies that are bargains. The tools that I describe in my book, The Confident Investor, will help you with that analysis. You can purchase my book wherever books are sold such as Amazon, Barnes and Noble, and Books A Million. It is available in e-book formats for Nook, Kindle, and iPad.