From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #408 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk Content-Transfer-Encoding: quoted-printable X-No-Archive: yes canslim-digest Saturday, October 10 1998 Volume 02 : Number 408 In this issue: Re: [CANSLIM] Flags and Poles Re: [CANSLIM] DG On-line Re: [CANSLIM] 'M Re: [CANSLIM] DG On-line Re: [CANSLIM] DG On-line [CANSLIM] Overbot/sold oscillator and other stuff Re: [CANSLIM] Flags and Poles Re: [CANSLIM] Flags and Poles Re: [CANSLIM] Scan for fundamentals resembling those of DELL [CANSLIM] Brokerages Re: [CANSLIM] Brokerages [CANSLIM] ASND Re: [CANSLIM] Overbot/sold oscillator and other stuff Re: [CANSLIM] Brokerages Re: [CANSLIM] Flags and Poles Re: [CANSLIM] Scan for fundamentals resembling those of DELL Re: [CANSLIM] Scan for fundamentals resembling those of DELL [CANSLIM] A more positive view Re: [CANSLIM] A more positive view [CANSLIM] Gotta chuckle about this [CANSLIM] Stock Screens Re: [CANSLIM] Scan for fundamentals resembling those of DELL Re: [CANSLIM] Overbot/sold oscillator and other stuff [CANSLIM] US Leadership in World [CANSLIM] (CANSLIM] Yield curve Re: [CANSLIM] (CANSLIM] Yield curve Re: [CANSLIM] What the pro's look for: Db's questions answered Re: [CANSLIM] What the pro's look for: Db's questions answered Re: [CANSLIM] Flags and Poles Re: [CANSLIM] Scan for fundamentals resembling those of DELL Re: [CANSLIM] Flags and Poles Re: [CANSLIM] Scan for fundamentals resembling those of DELL Re: [CANSLIM] Scan for fundamentals resembling those of DELL ---------------------------------------------------------------------- Date: Fri, 09 Oct 1998 10:11:31 +0100 From: Johan Van Houtven Subject: Re: [CANSLIM] Flags and Poles At 07:51 AM 08/10/98 -0700, you wrote: > > >Here's a good chance to test out the theory on price targets for flag >formations. The downside target for the Naz, according to the >wizards, is 1400. We will see. We will see. I know nothing about the theory on price targets for flag formations. But I'm more than willing to learn. :) Can you explain what you look for? - -- Johan Van Houtven - - ------------------------------ Date: Fri, 09 Oct 1998 10:38:16 +0100 From: Johan Van Houtven Subject: Re: [CANSLIM] DG On-line At 06:23 PM 08/10/98 -0700, you wrote: >Now that some time has passed since DGO went commercial ... can any of you >who pay for the service let the rest of us know how you feel about the value >you are getting ... I for one miss the beta service ... and have been >considering getting the fee service ... thanks ... John John, I would not like to be without it, since there is no real alternative for quality fundamental data and lists with EPS rank, RS rank and GRS, etc. Having said that I also must say that I go get these lists maybe once a week, during the weekend. During the trading week I use it to look at the indexes because some of them are shown in real-time, like the NASDAQ, Dow Ind Actual, SP500 and NYSE. That helps me to asses the current state of the market. Sometimes I also look at a chart of a stocks, primarily when a certain stock catches my interest and I want to have a quick look at the fundies and chart. What about the value you ask? I think it is priced to high. But I do choose to pay up for it since there is no alternative for me. (I live abroad so can't get IBD.) Quotes plus v2 is much better value, BUT is can't replace DGO's quality fundamental data yet. If I were forced to choose, I'd choose QPv2. If you really want to try DGO again, why not take a monthly subscription. If you find that you don't want it anymore, you can cancel it that month. Hope this helps a bit. - -- Johan Van Houtven - - ------------------------------ Date: Fri, 09 Oct 1998 11:18:23 +0100 From: Johan Van Houtven Subject: Re: [CANSLIM] 'M >Me, I'm >not panic'd, too late for that I guess, just generally disgusted with >my lack of discipline and attention. Maybe I shouldn't offer any advice, but I have a hard time keep thoughts for myself when I *think* they might help someone even it it would help just a liile bit. So here goes: For me personally I've come to realise that times of real pain are also times of great potential to change things. As I've mentioned before the following is one of the "Functional Fantasies" that I have hanging on the wall here: "In every adversity are hidden the seeds of victory." The next one might also be useful now: "Things don't get better by accident; they get better by appropriate action." Hope you can drawn some benefits out of this when the time is right. - -- Johan Van Houtven - - ------------------------------ Date: Thu, 8 Oct 1998 21:55:35 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] DG On-line While I can't claim it has made me a specific amount of money having the service, I don't regret spending the money. The cheapest route, assuming they are still offering the discounts, is to take one book a month, then subscribe to the online service as an "added". Cost $530 that way vice the $700+ for just DG Online by itself. You can always throw away the book, and still save $200/year. And they have added a few new features since going commercial which make it slightly more "value added". Tom W - -----Original Message----- From: John Iding To: canslim@lists.xmission.com Date: Thursday, October 08, 1998 9:24 PM Subject: [CANSLIM] DG On-line >Now that some time has passed since DGO went commercial ... can any of you >who pay for the service let the rest of us know how you feel about the value >you are getting ... I for one miss the beta service ... and have been >considering getting the fee service ... thanks ... John > > > >- > - - ------------------------------ Date: Thu, 08 Oct 1998 22:18:21 -0500 From: "John Adair, M.D." Subject: Re: [CANSLIM] DG On-line I too miss the DGO. Have you checked the specials when you subscribe to one book monthly you can get both for $ 500.00. If you subscribe to both books weekly you can get the DGO for $99.00.I am tempted but not in this market When the dust settles and The sun shines on canslim Type stocks. I plan to subscribe in some manner. John Adair John Iding wrote: > Now that some time has passed since DGO went commercial ... can any of you > who pay for the service let the rest of us know how you feel about the value > you are getting ... I for one miss the beta service ... and have been > considering getting the fee service ... thanks ... John > > - - - ------------------------------ Date: Fri, 9 Oct 1998 07:15:37 -0400 From: "Tom Worley" Subject: [CANSLIM] Overbot/sold oscillator and other stuff Noticed this morning that DG Online is showing the oscillator for Nasdaq at a minus 1237. I cannot recall ever seeing it break 1000 before. It was around -800 just a day or so ago. I don't watch other overbot-oversold oscillators as regularly, but suspect most will show similar nrs on Naz. Comments?? Japan failed to make any gains, closing down for the day at another new record, this time breaking the 12,900 level. Europe, however, on the plus side. And the yen is stronger against the dollar, tho the dollar appears to be finally stabilizing. Monday is Columbus Day in the USA, another of those hard to understand things we do, honor the guy who ultimately led the invasion and exploitation of this country, leading to the destruction of most of the native population. Maybe that explains why the banks are closed (thus no liquidity) yet the stock markets are open. For the past ten years, I have always grumbled at having to work when the banks are closed. Finally, this year, I intend to enjoy my day off (tho I admit I will sneak a peak at the mkts occasionally). I would expect volume to be down, however. If today proves to be quiet, as I suspect it will, Monday might prove to be a "rebuilding" day of calm. Tom W - - ------------------------------ Date: Fri, 9 Oct 1998 05:43:55 -0700 (PDT) From: TM Subject: Re: [CANSLIM] Flags and Poles Here is one person's opinion: http://www.geocities.com/WallStreet/Exchange/9807/Charts/Temp/US298798.htm Look under where are we now. TM - ---Johan Van Houtven wrote: > > At 07:51 AM 08/10/98 -0700, you wrote: > > > > > >Here's a good chance to test out the theory on price targets for flag > >formations. The downside target for the Naz, according to the > >wizards, is 1400. We will see. We will see. > > I know nothing about the theory on price targets for flag formations. But > I'm more than willing to learn. :) > > Can you explain what you look for? > > > > > -- Johan Van Houtven > > > > - > > _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 06:00:24 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Flags and Poles <> Take the height of the pole, then deduct it from the point at which the flag fails. In the case of the Naz, the pole is about 300 points long and the price fell out of the flag at 1700. So 1700-300=1400, more or less. When it works, the technicians all point to it and say "See?" and when it doesn't, everyone changes the subject, so it isn't the sort of thing you can take to the bank. But when the results of these arithmetic manipulations match up to the level of the long-term trendlines, I start to feel real creepy. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 07:11:44 -0700 (PDT) From: rolatzi Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL - ---Dan Sutton wrote: > > > I ran the scan tonight looking for the following characteristics: > > > STOCK PRICE > 10.0 > EARNINGS GROWTH 1-YR > 50 > EPS RANK > 90.0 > ANNLZD 5-YR PROJ EPS> 20.0 > PROJ EPS % CHG CUR >30.0-999998.0 a > NXT FY PROJ EARNINGS > 20.0 > EPS STABILITY> 90.0 > POSITIVE EARNINGS SURPRISES LAST 4 QTRS = OR >2 > > And here are the results: Dan: Interesting idea. My first look at these companies was how far from their yearly highs are they now. They look terrible. The decline from their yearly highs are as follows with * indicating the best of them. > DELL 26 * > ABDR 34 * > LGTO 36 * > ANF 54 > RHI 47 > KEA AMEX > HCFP 54 > INSS 36 * > SAPE 54 > MCRL 47 > AHLS 47 > CHRZ 57 > PSUN 79 > MISI 50 > ACTN 49 > HH 28 * > RXSD 54 > ANLT 67 > CBR 63 Ciao, rolatzi _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 07:22:38 -0700 (PDT) From: dbphoenix Subject: [CANSLIM] Brokerages If you have any interest in brokerages, note that MER, LEH and MWD were the most heavily traded brokerage stocks yesterday with the biggest price gains. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 10:22:12 -0400 (EDT) From: Deepak Kapur Subject: Re: [CANSLIM] Brokerages Db, >If you have any interest in brokerages, note that MER, LEH and MWD >were the most heavily traded brokerage stocks yesterday with the >biggest price gains. What is the implication here? Bottom reached in thses stocks? Thanks. Deepak - - ------------------------------ Date: Fri, 9 Oct 1998 07:33:03 -0700 (PDT) From: dbphoenix Subject: [CANSLIM] ASND It's always a good idea to note what are the first stocks that investors turn to on a rally. Also what groups, if you can detect a pattern. (Also, which stocks and groups they DON'T turn to . . .) ASND was one of these. It's formed a very nice double bottom, and the relative strength line shows that the second leg undercut the first (not shown by the price plot). The reward/risk ratio here is not favorable due to all the resistance it has to face, but this was a beautiful LLUR until July. One to watch. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 09 Oct 1998 10:32:51 -0400 From: Ari Lawson Subject: Re: [CANSLIM] Overbot/sold oscillator and other stuff Tom, Where do you see the DGO Nasdaq overbot cscillator at -1237 ? Mine says -899 for 10/08/98 ? Thanks Ari - - ------------------------------ Date: Fri, 9 Oct 1998 07:37:09 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Brokerages <If you have any interest in brokerages, note that MER, LEH and MWD >were the most heavily traded brokerage stocks yesterday with the >biggest price gains. What is the implication here? Bottom reached in thses stocks? Thanks. Deepak>> As I said in a subsequent post, it's always interesting to see which stocks--either in general or within a group--investors rush to first after a major decline. If, for example, you have any interest in banks but don't know which to choose, look to see which banks investors want to own the most after the group has been trashed. This doesn't mean that all these stock won't retest their lows. They should. I never buy off V bottoms, though some people do and are successful at it. But the stocks that are the most eagerly sought are the ones that are most likely to go on my short-term watchlist. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 09 Oct 1998 16:45:18 +0100 From: Johan Van Houtven Subject: Re: [CANSLIM] Flags and Poles TM, Thx, interesting reading. Thx to DB also for the concise explanation of the rising flag scenario. At 05:43 AM 09/10/98 -0700, you wrote: > > >Here is one person's opinion: >http://www.geocities.com/WallStreet/Exchange/9807/Charts/Temp/US298798.htm > Look under where are we now. > >TM - -- Johan Van Houtven - - ------------------------------ Date: Fri, 9 Oct 1998 10:17:07 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL Since Abby reduced her projections for earnings in '98 and '99, I've been thinking about what professionals are going to look for in the coming year. Companies whose projected percentage earnings growth numbers are going to be greater than this year's? Or if everybody's "PPEG" is going to be less, then what? Companies whose PEs are less than their projected growth rates? Companies whose earnings had been accelerating but are not decelerating but are expected to accelerate again? It's going to get complicated. For example, I went through Dan's list to see what the growth picture looked like and how the PEs compared to the "PPEG". Every stock is expected to have a lower PPEG than for the current year. Only DELL and LGTO have PEs that are greater than the PPEG. So do we concentrate on DELL and LGTO because their higher PEs indicate a higher desire to own them? Or do we focus on the stocks with the lower PEs because they represent value (eliminating, of course, those stocks which have declined for more serious reasons than the general world situation)? Or do we junk them all and look only for stocks which are expected to grow earnings during the coming year no matter what? Do we forget about EPS entirely and go with RS? What is to be the strategy for searching, selecting, tracking, and buying? Comments? - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 10:26:42 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL <> Correction. That should read "now", rather than "not". - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 10:36:35 -0700 (PDT) From: TM Subject: [CANSLIM] A more positive view http://cbs.marketwatch.com/archive/19981009/news/current/moses.htx?source=blq/yhoo http://cbs.marketwatch.com/archive/19981009/news/current/moscow.htx?source=blq/yhoo Also, according to infobeat, the IMF has money for Brazil now. TM _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 11:45:03 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] A more positive view Someone in another group pointed out to me that the volume on the Naz is decreasing, whereas the volume on the NYSE is increasing, indicating a possible bottoming process in the Naz (and potentially more downside in the other major averages?). What makes this all so difficult is that these are all weighted averages. If you want to know what's going to happen to the Naz, watch DELL, CSCO, INTC, and MSFT. In a sense, they ARE the Naz. Ditto with the NYSE. The ten largest-cap stocks there are GE, XON, MRK, PFE, KO, WMT, IBM, MO, T, and JNJ. As they go, so goes the composite. The Naz has done nothing more than catch up with all the other stocks represented by the index. The other major averages have yet to do the same. Perhaps the question is, will the large-cap love affair turn sour, and, if so, when? And at the end of that tunnel, what will emerge? Perhaps the stocks that are least dependent on world events, like internet (and related stocks like networks and data storage), healthcare, software, retail geared toward teens and children. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 9 Oct 1998 18:56:49 -0400 From: "Tom Worley" Subject: [CANSLIM] Gotta chuckle about this I love it, now the Japanese authorities are blaming the crash of their mkt on Thursday, and a further slide on Friday, on the weak US dollar which now makes their exports more expensive, and caused their major exporters to tank. And now they are running around trying to squelch any rumors about possible dollar/yen intervention, the very thing they were talking up and "leaking" only about a week or so ago. Has anyone out there even got a plan? Even a concept of a plan? BTW, next week could be interesting from an economic standpoint. It's one of the rare occasions when the PPI and the CPI get reported on consecutive days (Thursday and Friday). Leaves little time to absorb the effects of the first before the second hits, unless they are in line with expectation. Tom W - - ------------------------------ Date: Fri, 09 Oct 98 19:07:50 PDT From: "Walter Stock" Subject: [CANSLIM] Stock Screens Have been following the screening that various members have been doing with interest. It may help the newbies (and perhaps the veterans as well) to check out the following. Back on September 11, IBD ran an article entitled "How to Screen for Top Stocks without a Computer" in the Investor's Corner section. In a nutshell, the article said to use the "Weekend Graphic Review" provided in IBD every Friday. The article said specifically that this list is derived from IBD's own computerized stock screen: " The computer starts with the top [industry] group and moves through the list, extracting all the stocks that score 85 = or higher in EPS and RS ranks. They must also be over $7 in price." = - page A7 The other criteria to be on the list is that the stock must be within 15% of its twelve month high. The idea is to combine this list with chart analysis, and away you go. The article also detailed in an accompanying table some of huge gains you would have made if you had invested in some of the stocks from the January 16 Weekend Review, e.g. EAII (+133%), LGTO (+127%), SAPE (+88%), AVRI (+67%), and 12 others. Interestingly, when the market is healthy, this list includes hundreds of equities. Today's IBD has the shortest list I have ever seen... a total of 32 stocks. PNNW SWWC PRU CGP WCG EWP CAH UFS MNMD JWA JWB MHP IBC OVID WWIN SCP SGP LLY LSBI CPN GENZ GNE VBNK BDX MATW BEI PSO RX FRE GILTF Hope this helps, Walter Stock Oakville, ONT - Canada - - ------------------------------ Date: Fri, 9 Oct 1998 19:08:07 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL I suspect the "big names" like Abbey Cohen are pretty shook up about now, and will be quite defensive for some time. Don't expect them to get aggressive or bullish until a trend is already (or nearly so) apparent. And I wouldn't expect that to happen with Q3 earnings reports, so likely it may not occur till early 1999. Until then, I would expect these "gorillas" to work on highly liquid, big cap, defensive stocks. Probably some in the consumer arena like P&G or Gillette; some major names in the tech sector (where DELL might even be considered); maybe even some of the biggest names in the financials or brokerage houses. But size will count, for safety. Tom W - -----Original Message----- From: dbphoenix To: canslim@lists.xmission.com Date: Friday, October 09, 1998 1:17 PM Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL > > >Since Abby reduced her projections for earnings in '98 and '99, I've >been thinking about what professionals are going to look for in the >coming year. Companies whose projected percentage earnings growth >numbers are going to be greater than this year's? Or if everybody's >"PPEG" is going to be less, then what? Companies whose PEs are less >than their projected growth rates? Companies whose earnings had been >accelerating but are not decelerating but are expected to accelerate >again? It's going to get complicated. > >For example, I went through Dan's list to see what the growth picture >looked like and how the PEs compared to the "PPEG". Every stock is >expected to have a lower PPEG than for the current year. Only DELL >and LGTO have PEs that are greater than the PPEG. So do we >concentrate on DELL and LGTO because their higher PEs indicate a >higher desire to own them? Or do we focus on the stocks with the >lower PEs because they represent value (eliminating, of course, those >stocks which have declined for more serious reasons than the general >world situation)? Or do we junk them all and look only for stocks >which are expected to grow earnings during the coming year no matter >what? Do we forget about EPS entirely and go with RS? What is to be >the strategy for searching, selecting, tracking, and buying? > >Comments? > >--Db > > >_________________________________________________________ >DO YOU YAHOO!? >Get your free @yahoo.com address at http://mail.yahoo.com > > >- > - - ------------------------------ Date: Fri, 9 Oct 1998 19:31:27 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Overbot/sold oscillator and other stuff Ari, At DGO, click on f2 (Markets) and move the cursor down to Nasdaq Market Indicators. This will bring up the 4 chart display. On the title line of the overbot/sold oscillator is the actual nrs (since the chart itself is off the scale). There you will see the -1237 that I noted. Tom W - -----Original Message----- From: Ari Lawson To: canslim@lists.xmission.com Date: Friday, October 09, 1998 10:33 AM Subject: Re: [CANSLIM] Overbot/sold oscillator and other stuff >Tom, > Where do you see the DGO Nasdaq overbot cscillator at -1237 ? Mine >says -899 for 10/08/98 ? > Thanks Ari > > >- > - - ------------------------------ Date: Fri, 09 Oct 98 20:12:56 PDT From: "Walter Stock" Subject: [CANSLIM] US Leadership in World In response to a private e-mail from a member of our group, a note about the perception of American leadership in the world. A member asked me about what the foreign perception of the US really is right now, and what the American market potential looks like to those living outside of the US. For the last century Canada has been the US's biggest trading partner, and best ally. Canadians have fought alongside Americans in every conflict from World War I to the Gulf War, the sole exception being Vietnam. Having said that, to many Canadians, the US is looking leaderless and weak... and more self-absorbed than usual. Many Canadians wonder if this is just temporary, or a sign of things to come. Rightly or wrongly, the Clinton mess makes US motives look very suspect (as in the military strike against Sudan/Afghanistan). Regardless of whether he survives the impeachment process or not, the foreign perception is that this process has to be debilitating to your country. I am convinced that a part of the fall in the US equity market comes from foreign selling of stocks, reinforced by the collapse in the US dollar against the Yen. Similarly, the bailout of LTCM seems like an exercise in hypocrisy. The financial media up here is absolutely livid about this, and Greenspan's halo has been permanently tarnished. After enduring lectures for years from the Fed about the merits of letting weak institutions go under, the feeling is that if LCTM had been allowed to perish, that the world financial system would still no doubt have survived. The press here says that this is an example of American "do as I say, not as I do". More reason to exit US equity markets, as many pundits up here say that the European "Big Three" (Germany, France and Britain) are the place to invest. After all, they say, the US markets have been = a nice ride over the last years, but all good things must end. Do I personally agree with these perceptions? Not really. I still think that the US markets will outperform for at least the next year or so. This may change after European unification. Americans should never forget that they border on greatness. ( It' s just to the north. ) :-) Walter - - ------------------------------ Date: Sat, 10 Oct 1998 14:34:39 +1300 From: "Dean Edwards" Subject: [CANSLIM] (CANSLIM] Yield curve This is really cool! The Living Yield Curve http://www.smartmoney.com/si/tools/onebond/index.cfm?story=yieldcurve You can compare the present yield curve against previous years and months, going as far back as 1978. With explanations on the shapes - inverted, flat etc. Other signs of increased confidence among investors included the move away from defensive type stocks such as McDonald's Co. and Procter & Gamble Co. , and taking cash from typical safe-havens such as utilities. The Dow Jones Utility Average closed down 9.05 points, or 2.82 percent, at 311.46. . Financials and techs stocks, two key sectors which have led Wall Street's bull run, rebounded after being oversold, traders said. Hopes of a Fed rate cut, belief that a leading fund was not in danger and that broker Merrill Lynch was the focus of interest on several fronts, also helped the financials rally. - - ------------------------------ Date: Fri, 9 Oct 1998 19:07:55 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] (CANSLIM] Yield curve <> You're right. Smart Money is a great site. It's one of my nitely stops. Have you checked out their Sector Tracker? Extremely cool. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 09 Oct 98 22:18:39 PDT From: "Walter Stock" Subject: Re: [CANSLIM] What the pro's look for: Db's questions answered > Since Abby reduced her projections for earnings in '98 and '99, I've > been thinking about what professionals are going to look for in the > coming year. Companies whose projected percentage earnings growth > numbers are going to be greater than this year's? Or if everybody's > "PPEG" is going to be less, then what? Companies whose PEs are less > than their projected growth rates? Companies whose earnings had been > accelerating but are not decelerating but are expected to accelerate > again? It's going to get complicated. > For example, I went through Dan's list to see what the growth picture > looked like and how the PEs compared to the "PPEG". Every stock is > expected to have a lower PPEG than for the current year. Only DELL > and LGTO have PEs that are greater than the PPEG. So do we > concentrate on DELL and LGTO because their higher PEs indicate a > higher desire to own them? Or do we focus on the stocks with the > lower PEs because they represent value (eliminating, of course, those > stocks which have declined for more serious reasons than the general > world situation)? Or do we junk them all and look only for stocks > which are expected to grow earnings during the coming year no matter > what? Do we forget about EPS entirely and go with RS? What is to be > the strategy for searching, selecting, tracking, and buying? > Comments? > --Db Hi Db, I have the answers to your questions. ;-) Unfortunately they are from last December, and fashions change.... On December 8 '97, Barron's ran an article about what exactly causes = Wall Street's professionals to "pull their billions out of one stock and put them into another". Seems Merrill Lynch conducts an annual poll of its institutional clients to get the answer. These items are wha= t the institutional investors watch: "Reason for Deciding to Buy or Sell a Stock" Earnings surprise - 54.1 % of institutional investors consider this ROE - 50.8% Analysts' earnings revisions - 48.4 % Price to cash flow ratio - 48.4 % Projected 5 year profit growth - 45.9 % Debt to equity ratio - 43.4 % Earnings momentum - 41.0 % Relative Strength - 38.5 % Price to earnings ratio - 34.4 % Price to book ratio - 33.6 % Analyst opinion change - 33.6 % Earnings variability - 31.1 % Dividend discount model - 29.5 % Price to sales ratio - 27.9 % Neglected stocks - 24.6 % Beta - 13.9 % Earnings estimate dispersion - 13.9 % Dividend yield - 12.3 % Earnings uncertainty - 12.3 % Foreign exposure - 12.3 % Size - 12.3 % Low stock price - 7.4 % Interest-rate sensitivity - 5.7% Now my question back to Barron's is... if I start following all of this, do I get to underperform the S&P just like the pro's ? Huh ? Huh? Oh pretty please ? Nah, I think I'll wait for John Meriwether and the rest of the geniuses at LTCM to publish their memoirs so I can learn how to invest just like them : Lemme see now... we use full margin... we buy common stock on Thanksgiving falling on the first Wednesday of November, and short stock on Christmas falling in December. Umm... we borrow cash using full house equity. Uhh... max up leverage now, using same cash from house collateral for 23 different bank loans, heh, heh, heh. Oh... now have brainwave... sell call options on movie Titannic, naked; sell puts on Godzilla, naked. Um... more genius brainwave coming... go long Ashtar; short Saving Private Ryan. For result of strategy refer to latter movie (first 25 minutes) (with apologies to Jeff Berkowitz and theStreet.com) Happy trading. Walter Stock Oakville, ONT - Canada - - ------------------------------ Date: Fri, 9 Oct 1998 19:43:45 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] What the pro's look for: Db's questions answered <> Well, my first question is, since there are only two items which more than half those surveyed pay attention to, and even those are only 51% and 54%, just what DO they pay attention to? I suspect the truth is that they buy what all the other managers are buying but don't want to admit it. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 09 Oct 1998 06:50:22 -0400 From: Kom Tukovinit Subject: Re: [CANSLIM] Flags and Poles Oh, yeah, I refuse to sell below cost, so I am holding the shares till either it goes to 0 or goes above cost, whichever comes first... kom dbphoenix wrote: > < formations. But > I'm more than willing to learn. :) > > Can you explain what you look for?>> > > Take the height of the pole, then deduct it from the point at which > the flag fails. In the case of the Naz, the pole is about 300 points > long and the price fell out of the flag at 1700. So 1700-300=1400, > more or less. > > When it works, the technicians all point to it and say "See?" and when > it doesn't, everyone changes the subject, so it isn't the sort of > thing you can take to the bank. But when the results of these > arithmetic manipulations match up to the level of the long-term > trendlines, I start to feel real creepy. > > --Db > > _________________________________________________________ > DO YOU YAHOO!? > Get your free @yahoo.com address at http://mail.yahoo.com > > - - - ------------------------------ Date: Fri, 9 Oct 1998 21:42:23 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL > I suspect the "big names" like Abbey Cohen are pretty shook up about > now, and will be quite defensive for some time. Don't expect them to > get aggressive or bullish until a trend is already (or nearly so) > apparent. And I wouldn't expect that to happen with Q3 earnings Abby was in town yesterday, was reported on in the local business section, she remains bullish, said the market will move up 20-25% in the next 12 to 15 months. Said stocks are undervalued at this time. So she is sticking to her bullish stance. - - ------------------------------ Date: Fri, 9 Oct 1998 22:32:50 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] Flags and Poles > Can you explain what you look for? > I can't give you too much help, but Biogen (BGEN) formed a nearly perfect pennant in mid Sept., where it ran up to 64, then traded lower for a few days, down to 60, then spiked up to maybe 67. That is what the things look like anyway, if that is any use to you. - - ------------------------------ Date: Sat, 10 Oct 1998 10:27:47 +0200 From: Johan Van Houtven Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL At 07:08 PM 09-10-98 -0400, you wrote: >I suspect the "big names" like Abbey Cohen are pretty shook up about >now, and will be quite defensive for some time. Don't expect them to >get aggressive or bullish until a trend is already (or nearly so) >apparent. And I wouldn't expect that to happen with Q3 earnings >reports, so likely it may not occur till early 1999. Until then, I >would expect these "gorillas" to work on highly liquid, big cap, >defensive stocks. Probably some in the consumer arena like P&G or >Gillette; some major names in the tech sector (where DELL might even >be considered); maybe even some of the biggest names in the financials >or brokerage houses. But size will count, for safety. > >Tom W Whar I saw yesterday, was significant selling in 'safe' utilities like BLS and buying in 'risky' financials like MER. Whether this is temporary or not we'll have to see. Johan Van Houtven / CLICK! N.V. - - ------------------------------ Date: Sat, 10 Oct 1998 10:15:04 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL I don't think yesterday is a very good guide. Rumors abound, action is very emotional and volatile, and major price swings are occurring for reasons having little to do the the stocks themselves. Utilities are generally valued as income devices, relatively safe since we all continue to need their services. However for the past several weeks to over a month, they just like the Treasuries have become a safe haven, and were well overpriced and due for some serious profit taking. Merrill (MER) was the subject of rumors regarding a possible buyout, with several different parties interested. This coincided with it already being seriously oversold, for due for a correction upward anyway. Even with some drop in earnings from fewer IPOs and Investment Banking activities, this is viewed as temporary. Merrill remains a strong company. And look at the huge reversal in Treasuries in the past two days, a move bigger than any in 25 years. And all attributed to hedge funds unwinding positions, many related to being on the wrong side of the yen. I think we are only beginning to see the tip of the iceberg on hedge funds, they seem to have all followed the LTCM model like lemmings. And since Greenspan and others have already established the practice of bailouts, maybe now we need a new Resolution Trust Corp for hedge funds. At least then their positions might get unwound in a smoother fashion without disrupting the mkt. It'll take a while, and some calmness and sanity returning to the mkts, before it's clear what the gorillas are going after, either by sector or individual stock. Tom W - -----Original Message----- From: Johan Van Houtven To: canslim@lists.xmission.com Date: Saturday, October 10, 1998 4:27 AM Subject: Re: [CANSLIM] Scan for fundamentals resembling those of DELL > >Whar I saw yesterday, was significant selling in 'safe' utilities like BLS >and buying in 'risky' financials like MER. Whether this is temporary or not >we'll have to see. > > > >Johan Van Houtven / CLICK! N.V. > > > > >- > - - ------------------------------ End of canslim-digest V2 #408 ***************************** To unsubscribe to canslim-digest, send an email to "majordomo@xmission.com" with "unsubscribe canslim-digest" in the body of the message. For information on digests or retrieving files and old messages send "help" to the same address. Do not use quotes in your message.