The First Data LBO is another data point confirming that US stocks are cheap. FDC had a PE of 21x on 2007 estimates (19x on 2008 estimates) even with choppy, low growth of earnings. FDC does have good cash flow and is in a business that's not too risky in a downturn. FDC earnings grew in the 2000-2001 recession. KKR is paying $34/share, or a PE of 30x on 2008 numbers. I'll write more about valuations of growth later. I think the excessive funds in trading oriented hedge funds has led to substantial undervaluation of US stocks, particularly "three letter stocks" hehe. Over this year, barring unforeseen events, I think the market will grind out a 20% gain as these values are slowly realized.
Over the past two weeks I put more money in big cap US stocks in a separate fund managed primarily by Mrs. Bunkerman. I need a name for that fund, but for now I guess I'll watch it as part of the Krypto Fund. Maybe the "Sky Fund" would fit. [hehehe.] He's going to be our biggest dog [big caps - big dog, hehe] & the "sky" sort of fits Mrs. Bunkerman's interests.
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11 comments:
so MTB is the first alt a to blow up, suggesting its not contained at the sub prime level. fed seems between rock (inflation) and hard place (slowing growth) at the same time more upside wudnt shock me
i put eee hgr asgr ont mcv nm thn inxi ntls and vcc on a trading list. some of the those look pretty gud
nvax cures flu in ferrets, lol.
darkside calling me here
A banker making no-docs loans should be in jail, imho, unless for under 50% knock-down LTV.
Obviously the regulators were asleep on that one, amazing to see it happen again after the 1990 RTC mess.
y is silver getting slammed?
beefers?
oops prices paid 65.5, way above exp.
LEH to 0? charts says bye bye baby
Silver is just in a trading band for awhile, consolidationg imho. Ditto gold.
It's always hard for me put ever put any credence in expecations on something like ISM prices paid. Those guys know zippo. As if a little hot prices is new since we have the CPI & PCE data for awhile.
But by spring we need a dip of stocks will have a hard time going up.
Who has a list of stocks with big alt-A exposure? ABK BKUNA STI some I came up with....but I not so smart
ooops, by spring a dip in inflation OR stocks will have a hard time giong up. Sorry typo, I can't go in & fix those.
bsc
leh nde lum tri imh gs & bac to name some.
hit 500 bkuna for a gud time
MTB sure looked like LEH and BSC before today
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