Rockwell Collins (COL)

Rockwell Collins (COL) will report earnings in the morning. Estimates are $1.11 versus $0.96. The stock price is above the price target and as such this name is a hold for now. In the last year, the stock is up over $17 in price. Hence the full valuation. 

col

Starbucks (SBUX)

Starbucks (SBUX) will report  earnings after the close. Estimates are $0.80 versus $0.71. There is still more than $7 of upside to our price target. I would be will to wager that this quarter will be a blowout as gas price drops may bring in more customers that want to give Starbucks a try.

 sbux

Weekly Charts Updated

Each week we highlight charts below of the SP500, Russell 2000, NASDAQ Composite, UUP, EEM, TLT, HYG and LQD. The charts use the 50 day moving average slope indicator. When it is green we like the instrument we are tracking and when it is red we avoid the name/sector/asset class.

The S&P 500 is still in the green despite the chaotic volatility. The S&P 500 is above 0 on our indicator but still below the actual 50 day moving average. Charts are created from www.erlangerchartroom.com and if interested in using this indicator in Chart Room please feel free to send us an email by using the Contact Us section from the home page. 

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American Express (AXP)

American Express (AXP) will report earnings after the close. Estimates are $1.39 versus $1.21. Good growth. There is some nice upside to this name. 

axp

Portfolio Update

The big story of our portfolio this past year is that it is a safe portfolio but yet we have a pharmaceutical/biotech stock in Bristol Myers Squibb(BMY)and a large cap biotech stock Celgene (CELG) that are making you lots of money. These two names helped us to get to almost a 30% return for the year.

We bought Celgene (CELG) at $77.66 on June 4th and it is now at $123.25. That is a 58.70% gain folks. Most sellside firm have raised price targets to $140 to $150. With numbers like that, we are getting close to a 100% return in a year.

Bristol Myers is gaining on Celgene as it is now up 21.95% in less than six months as it was bought on July 30th. Sure there are lots of “Johnny Come Latelies” on Bristol Myers but we made the tough call to get in when no one wanted to own it. Even Jim “Bristol Myers” Cramer hated the stock in late July. Of course, he loves it now.

James and I believe that our process trumps others because our technical measures allow us to enter a stock before others see improvement in the charts. With the recent weakness, we are going to find other stocks like Bristol Myers.

Be careful of buying into names recommended that have already moved a big percentage. Many times such names will see 10-25% pullbacks after a big run in a matter of weeks. Now on to our weekly review.

The S&P 500 has moved lower for a third week in a row. The Nasdaq Composite fell as well. The good news is we are still making money despite the drop in the indexes. The portfolio is now 75% invested long, 0% short and 25% in cash, net long 75%. We are now at a value of 956.70% from 954.65% from last Tuesday. We finished the year at a value of 951.10 up 29.86% for the year. Our current value is 956.70% which puts us up 5.60% or 0.58%. This is an abbreviated update due to travel and limited computer capabilities.

Below are the year by year results on a cumulative and absolute basis:

ssi returns

It appears for the time being that 2000 on the S&P 500 has become support and 2050 is resistance. This is where we were last week so no change.

Johnson & Johnson (JNJ)

Johnson & Johnson (JNJ) is near its price target but also close to the lower limit. We note that Goldman Sachs place a sell rating on the stock in front of earnings. We would be a buyer if the lower limit get hits.

 jnj

The Week Ahead

1.Geopolitical and Fiscal Events. Tuesday sees President Obama give his State of the Union Address. Also, on Tuesday the World Economic Forum begins in Davos, Switzerland. Wednesday sees the Bank of Japan announce its latest rate decision. Thursday sees the ECB announce its latest interest rate decision.

2.Economic Releases. Releases of note this week include the weekly chain store sales, oil/gas numbers, mortgage applications and NAHB Housing Index, Housing Starts, Leading Indicators and Existing Home Sales.

3.Earnings Releases. Notable releases include JNJ IBM UNH AXP VZ UNP GE MCD(this is a very light week for earnings with only earnings on Monday and Tuesday). See the earnings section.

Goldman Sachs (GS)

Goldman Sachs (GS) will report earnings. Given the weakness in stocks this week, Goldman is getting attractive to look at as a potential buy.  The stock should find support at $175. Worth a look at that level.

 gs

Weekly Charts Updated

Each week we highlight charts below of the SP500, Russell 2000, NASDAQ Composite, UUP, EEM, TLT, HYG and LQD. The charts use the 50 day moving average slope indicator. When it is green we like the instrument we are tracking and when it is red we avoid the name/sector/asset class. 

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The S&P 500 is still in the green despite the chaotic volatility. HYG clicked into the red too many weeks ago and is still there. Much has been written about high yield and the fact it owns many energy bonds. It ended its free fall but may be starting a new leg down. Remember what matters is the slope of the 50 day moving average not the 50 day moving average itself. 

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All charts are created from www.erlangerchartroom.com and if interested in using this indicator in Chart Room please feel free to send us an email by using the Contact Us section from the home page.

Schlumberger (SLB)

Schlumberger (SLB) will report earnings after the close. Estimates are $1.47 versus $1.35.  Decent growth but the key will be guidance for this and EVERY energy company this quarter. As such, with the stock near its recent low watch to see if this level holds.

 slb