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Sailing Markets has moved to the Trading Effect blog with all the previous posts and valuable comments.

PFE: update

Price/(book value): 2.08

Annual EPS growth (last 3 years): 7 % / DEC/2009 (quarter) vs June/2009 (quarter): -13%

Revenue growth Dec/2009 vs Sep/2009: -51%

Dividend yield: 4.2%

GE - General Electric

It has one of the lowest Price/book value of the DOW's companies. 

The annual rate of growth in the EPS in the last 3 years is negative, -18%. (and it has decreased 53% from dec/2007 to dec/2009).

Total Debt to equity: 4.35. One of the highest of the DOW JONES.

Annual revenue growth (dec/2008 vs dec/2009): -14%. But from March/2009 to Dec/2009, revenue increased 8%.

Dividend yield: 2.5%.

Weekly chart:

Daily charts:

GOLD

This is one of the elliot wave counts and patterns that I am following in Gold. May be this is a good risk-reward opportunity to go long on gold, considering that the US Dollar is at very high levels and (in my humble opinion) finishing the last impulse (wave 5).

Weekly chart:

Daily Chart:

C: Target reached

Today C reached the objective of 4.34 (EMA 200). I have this tentative elliot structure in the intraday chart...

In the daily chart, this is the structure. Notice the divergences in the RSI. This divergence  at least tell us that we should not go long here... but the EMA's tell that we should not go short too. The 200 daily EMA is the next resistance (4.34) . In addition huge volume today.

3 days frequency chart: notice the resistance in the 23.6 % fibonacci retracement (4.40)

Euro-Usd

Yes, the signal it is not clear enough, but may be the next coming days we will understand. This could be more fuel to the market rally, (if it breaks the channel).

EURO-USD weekly chart - Fibo's: 

EURO-USD daily chart - Fibo's: 

Let's see what's happening in the FXE:

PFE: watch-list

IWM: Bull

Notice how the Russell 2000 broke the key resistance.... but we can expect a pullback this week. The target is 74.55. Amazing the rally of this index.

XOM: Update

We had a buy signal some days ago. Look the interesting pattern that is developing. I am not sure but looking at the volume decreasing during the formation of the triangle and the break with relative high volume (a little high), I would guess that we have a change in the trend, at least in the short term. The target could be 71.5, where it is the  61.8% fibonacci retracement and where it fills the gap.
In addition I suggest to look in the previous post about XOM where there is a long term perspective for the stock.

Critical levels

To continue with the  previous post in which we measure the SPX in euro, we notice the critical resistance reached.

In the previous post on the S & P 500, we highlighted a down trend-line that was acting as a resistance. But this red down trend-line have been broken. Then, I think 1222 in S & P are possible, but respecting the trend-line from 1962 (green dotted line). The green trend line cross 1222 in October 2010.

Quarterly chart S & P 500:

DOW JONES: Fundamental Analysis

During February and March, we have received the last balance sheets of the DOW JONES components. Using the statistics of Yahoo Finance and the information available in my broker, I made some relationships and comparisons between them. In addition, I compare the situation now and some periods ago. 

First, lets take a look to the Current Price / Book value relationship.  I am wondering why BA is so high, and the implications. AA, BAC, CVX, GE, DIS, JPM, KFT, T and TRV have good ratios.

Now, here we compare the beta of each stock. Notice that sectors like energy (XOM & CVX), consumer goods (KO, KFT, PG), Services (MCD & WMT), telecomunications (VZ & T) and drugs manufactures (PFE, MRK & JNJ) have the lowest. This are the "defensives" companies. 

Now that we have some idea about how this companies could react to the crisis, let's take a look on how they reacted until now. 

First, the revenues and the E.P.S.: MRK, T, PFE, MCD, PG, T, VZ and WMT were little affected. 

The E.P.S. growth vs. dividend growth (annual rate, from January 2007 to December 2009). It is interesting to notice the growth in the EPS of MRK, but this growth is not in relationship with the growth in dividend. Then, I would consider that an increase of dividends in MRK is something possible. MCD, PG, PFE and KFT are some companies in the same situation as MRK.

Revenue year over year (2009 vs 2008) and quarter over quarter (DEC/2009 vs SEP/2009). Notice that revenues from BA, HPQ, JNJ,, MCD, MRK, TRV, PFE, T and VZ were not affected.

Average annual  revenue, income and E.P.S. (2007 = 100%). I add up the revenue, income and E.P.S. of the 30 companies and divided by 30, to obtain an idea of this key numbers and their evolution during 2008 and 2009:

Average quarter revenue, income and E.P.S. (June 2009 = 100%):