Monday, May 24, 2010

WMT

WMT is reaching an area in which could be worth to take a look. The stock market is very oversold, and may be WMT is a good opportunity to play the rebound if this one finally arrives. Notice how the 38.2% fibonacci retracement from the September 2008 highs coincides with the 50% fibonacci retracement from the March 2010 highs.

But WMT it is not interesting solely based on it charts. The fundamentals are good too.

Some:

- The sales of this giant had been increasing since 2008, the subprime crisis does not push them into negative zone. They have increased 7.8% between 2008 and 2010 (3.9% annual growth). In this same term, the EPS is up 9%.
- The current divindend yield after taxes is 1.4%, with an average divindend growth in the last 3 years of 5.9%. This give us a discounted cash flow of 37 USD (one of the highest in the DOW JONES) with an 8% risk rate and 6.42% using CAPM (0.25 beta and 3.73% risk free rate)

Weekly chart:






Daily chart:



Saturday, May 8, 2010

Answers

Two weeks later, the market clear all the doubts and apparent contradictions in the gold, treasury and stock market. This are the answers:

France index in USD (weekly chart & fibonacci's):



FTSE in USD (weekly chart & fibonacci's):



IBEX 35 in USD (weekly chart & fibonacci's):

EUR/USD

Finally, the euro break the up-trend long term channel. Massive liquidation. 1.25 & 1.233 next supports.

EUR/USD Daily chart:


EUR/USD Monthly chart: channel 



Some projections: I am not trying to predict the future, I am only considering some probables scenarios since the break of the channel. 



Wednesday, May 5, 2010

European and american indexes

Continuing with the previous posts on the european markets, lets see some interesting coincidences and patterns.

The S & P 500 in euro: 61.8% reached, and uptrending. Look the RSI.



The DAX in US Dollar. Same fibonacci retracement reached... but downtrending.



Finally, look the weak recovery in the Athens market, in which it only reached the 38.2% fibonacci retracement:


We should wait for the week to finish, but the we can reach preliminary conclusions.
First, the american index is uptrending, and we can see a "flight to american securities", not only treasuries. The american stock market is resisting the european crisis.... but will it make it?

The Greece market is in free-falling, (obvious), and we can expect to reach the March 2009 lows. Then, a 10% correction in ATG and 7/8% in the DAX is likely to occur in the next weeks.

Finally, the DAX and the S & P had the same resistances in different currencies (the 61.8% fibo). Quite interesting.

Sunday, May 2, 2010

NII holdings (NIHD:NASDAQ)


This company provides provides wireless communication services to businesses and individuals primarily in Mexico, Brazil, Argentina, Peru, and Chile. Its services include mobile telephone services comprising various calling features, such as speakerphone, conference calling, voice-mail, call forwarding, and additional line service; and Nextel Direct Connect service, which allows subscribers anywhere on its network to talk to each other on a push-to-talk basis, private one-to-one call, or on a group call. The company also offers International Direct Connect service, which allows subscribers to communicate with its subscribers in Mexico, Brazil, Argentina, Peru, Chile, the United States, and Canada. In addition, it provides various services, such as text messaging; mobile Internet; e-mail services; location-based services, which include the use of global positioning system technologies, digital media services, and Java enabled business applications; and international roaming services. Further, the company offers two-way radio service. NII Holdings, Inc. provides its products and services under the Nextel brand name. The company sells its products and services through direct sales representatives, indirect sales agents, telesales, Nextel retail stores, shopping center kiosks, and Web site. It was formerly known as Nextel International, Inc. and changed its name to NII Holdings, Inc. in December 2001. The company was founded in 1995 and is based in Reston, Virginia.


During the first quarter of 2010, the Company added 377,000 net subscribers to its network, bringing its ending subscriber base to over 7.7 million, a 20% increase in the ending subscriber base compared to the end of the first quarter of 2009. Financial results for the quarter included consolidated operating revenues of $1.28 billion, a 33% increase compared to the first quarter of 2009, and consolidated OIBDA of $341 million for the quarter, a 39% increase compared to the same period last year.


The Company continued to invest in the expansion of the coverage and capacity of its networks reporting consolidated first quarter 2010 capital expenditures of $134 million, of which $85 million was invested in Brazil.


The Company ended the quarter with approximately $3.52 billion in total long-term debt and $2.7 billion in consolidated cash and short term investments, resulting in net debt at the end of the quarter of $841 million.

In 2005, the EPS was 1.06 and the stock price 46. Today, with an EPS of 2.26, it is at 42.47. 

Price / Book value = 2.5 /// Average 2002 - 2009 = 4.56
Price / Cash Flow = 8.6 /// Average 2002 - 2009 = 13.56



I would wait a pullback to go long.






Sources:

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