– The Stock Market Companion –
15MinuteStocks
Market Update
January 25, 2011
—— Stock Market Investing since the 1980’s ——
Published all Market Days
Monthly Subscription $29.95
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-Executive Summary-
- Mixed. The Dow (DJ-30) closed a bit lower while the NASDAQ posted gains (thanks to Apple Inc. and Intel Corp)… see below.
- At the SMC, we announced our entry TODAY in Intel Corp (Ticker: INTC) at $21.33/share with a stop at around $20.70/share … see below.
- We sent an SMC Intra-Day UPDATE highlighting YRC Worldwide Inc. (YRCW) … Special “Thank-You” to SMC Subscriber “Mr. N. Sackett – Tacoma, WA for the early email heads-up…
This Stock Market Companion 15MinuteStocks Market Update is a powerful tool designed to help you make money in the stock market. It’s web-based, therefore available wherever and whenever you are. It is your essential link to the markets, delivers a broad to narrow summary of important market and company specific conditions and events, and prepares you to be ready for actionable ideas. We show you when/where we put our own money to work… and when/where we take our profits/losses. Please see our short (2 minute) website videos for more information.
– Markets “At a Glance” –
(Please scroll down to the end of the report to see your favorite benchmarks – Dollar, Oil, Gold … closing prices and daily direction.)
Market |
Price (Today’s Close) |
Unit of Measure |
Today’s Direction |
SP-500 |
1,291.18 |
Index |
Flat = +0.34 points |
DOW-30 |
11,977.19 |
Index |
Flat = -3.33 points |
NASDAQ |
2,719.25 |
Index |
Flat = +1.70 points |
NASDAQ 100 |
2,304.03 |
Index |
Flat = +3.64 points |
– Market Trends –
Trend |
SP-500 |
DJ-30 |
NASDAQ |
NASDAQ 100 |
Short Term |
Down |
*FLAT/UP* |
Down |
Down |
Intermediate |
UP |
UP |
UP |
UP |
Long Term |
Lateral |
Lateral |
Lateral |
Lateral |
*Summary of terms from Trader Vic II-Principles of Professional Speculation (pg. 140-141)
*_________* Represents a change in trend rating.
– Market Perspectives –
For your added perspective, we’ve included these two different views of the broader market –
1. SMC SP-500 ETF Daily Chart (Click to open helpful chart in a separate browser window).
2. SMC SP-500 Weekly Chart (Spanning back through 2007)
– Today’s Highlights –
Here are some important points that are useful when considering the markets today –
1. Great Britain surprised everyone with a NEGATIVE gross domestic product quarter compared to the prior quarter. Remember that one measure of a recession is two consecutive quarters of negative GDP growth. Right now, the government is identifying snowy weather as the cause.
2. The European Financial Stability Facility (Euro-bonds being sold related to recent bailouts of Ireland…) bond sales were “exceptionally strong” on their first day today! “…Describing interest as “exceptionally strong,” The EFSF said its bond sale had attracted orders from more than 500 investors totaling 44.5 billion euros — roughly nine times the 5 billion euros of paper on offer….”. OK.
3. Commodity related metal stocks and oil were heavily sold today.
4. American consumer sentiment increased in January, compared to last month.
– Story-Stock Investing –
At the Stock Market Companion, we sent out an SMC Intra-Day Alert notifying of our SMC move into Intel Corporation (Ticker: INTC) stock at $21.33/share, with a stop at around $20.70/share. The stock moved favorably following our entry and closed higher on a rather lackluster day for the market. Good. Our investment is founded on the excellent earnings that Intel has announced in the last two quarters, their $10 billion share repurchase plan announced yesterday, and the idea that they are not going to let the smart phone and tablet-PC business develop without them. That being said, currently there are 1 million PC’s sold per DAY worldwide! That’s a staggering number. Here’s our SMC Intra-Day Alert for INTC –
Dear Subscriber-Friend –
At the SMC, we purchased shares of Intel Corp. (Ticker: INTC) on the favorable orientation of the stock this morning relative to the overall market and their $10 billion share repurchase plan announced yesterday. Our entry is $21.33/share. Our stop is down around $20.70/share
For your protection and our own, we would like to remind everyone that this is not an investment recommendation for any particular individual. We cannot possibly know the risk tolerance and investment suitability of such investments for any particular subscriber. Successful investors know their own objectives, purposes, and risks associated with any investment – whether in real estate, stocks, or other investments. Each investor is on their own.
We are simply reporting the SMC actions in the market place.
Your – Stock Market Companion
Today, “LTL” trucking company (LTL=Less than a Truckload) – YRC Worldwide, Inc.’s (Ticker: YRCW) STOCK crossed above $4/share on strong volume. The stock has been in a tight consolidation and today’s move looks good under our more “speculative” glasses at the Stock Market Companion.
Here’s a little history about YRCW and our Stock Market Companion involvement with the stock (please excuse us for being a bit long winded here)-
* On 9/30/2010 the company completed a reverse stock split of 1/25. This means for every 25 shares a shareholder had, he/she received “1” in return. The purpose of this reverse split was to get the stock price back up from 0.15/share (15 cents) to well above the stock exchange minimum of a $1/share in order to remain listed on the stock exchange. On that day, the stock closed at the post split amount of $6.25/share and has proceeded to sink to the low $3’s and is now pushing above $4/share.
* Before the above mentioned stock split, the stock had at one time been trading above $60/share and was reduced to almost valueless (0.15/share) due to reckless management in a razor-thin margin business. In a nutshell (and at the risk of possible over-simplification), the company had leveraged itself to make acquisitions and paid the debt expense by lowering shipping rates to attract shipping VOLUME. When the shipping volume dried up during the recent recession, the company quickly became a financial basket-case. The stock plummeted as investors abandoned the stock.
* YRCW competitors were licking their chops like wolves throughout 2009, eagerly awaiting for YRCW’s imminent bankruptcy filing. YRCW is severely disliked in the shipping industry for having contributed to destroying the pricing power of the shipping companies with its rock-bottom rates that they used to capture VOLUME (above). YRCW staggered along the edge of the bankruptcy precipice BUT in December of 2009 pulled out a hat-trick by convincing many of their bondholders to accept common stock in lieu of their bonds AND convincing their lenders that re-financing was better than a defunct YRCW. During the late Christmas season of 2009 at the end of a trading day, at the Stock Market Companion we caught wind of YRCW’s bond rating being UPGRADED from destined for default to CCC- (approx.) – which meant that the company would perhaps live again and the stock price would shoot higher. We immediately purchased shares at that time at approx. 93 cents a share and the stock increased to a 1.15. We thought that the stock may continue higher (when a sudden shift from imminent bankruptcy to still a “going concern” takes place, stocks can often really multiply – such as from $1/share to $6/share quickly), but it didn’t. Instead there were still “bugs in the ointment” and the stock slid back through our buy-point, we were stopped out for a loss (-17% = our worst loss of last year – but on a reduced share count commensurate with the speculative nature of the investment) and the stock continued to slide down to approx. 0.34/share, when there was huge volume and we bought again, as news was emerging that shipping volumes were on the rise and YRCW was proclaiming that they may be EBITDA (earnings before interest, taxes, deductions, amortizations) positive for the quarter. The stock began to really improve in luster and moved from our entry point at around 0.38 to 0.76 … and looked like it could be one of the last turn-around wonders from the recent financial panic and keep going higher. BUT it didn’t. It sank again, we took our +35% profits in the 50 cent/share range and watched the stock plummet to 10 cents a share!
* Then something crazy happened again. Several months later, the stock was hit with some incredibly strong buying volume at approx. 0.15/share, and we got on board again at around 0.16/share and ran the stock up to 0.40/share and then back down to approx. 0.32/share. At which point we took our approx. +104% profits and the stock slid back down to oblivion as the details of the reverse split (mentioned above) we beginning to be worked out. We have stayed away from the stock since then.
* YRCW meanwhile has managed to continue to stumble from quarter to quarter under their “comprehensive recovery plan”, selling off assets (shipping warehouses, distribution locations, and logistics operations) to raise cash, reducing head-count, and has renegotiated contracts with their union employees. Competitors have again tried to push YRCW into insolvency by claiming that the YRCW union agreement is illegal relative to the industry wide union agreement, but they haven’t been successful in their claims in court. This litigation was part of the reason for the recent post reverse stock-split slide from “$6 something” to “$3 and change.” The shipping business is known for its tough players and razor thin margins.
The stock is shooting higher today, but we can’t find any particular reason for the share price increase other than speculators taking a position prior to the Feb. 4th earnings release. The stock could very well recover in price to the pre-labor litigation price of $6/share going into the latest earnings report.
Our investments in YRCW last year were driven by –
1. Sudden news that the company would not file bankruptcy.
2. News that bondholders accepted common stock.
3. Frequently announced improved shipping volumes.
4. Announcements that the company may be EBITDA positive
5. “Hail-Mary” potential of the stock appreciating very significantly due to the convergence of points 1-4 above.
At this point, we don’t have the “surprise” advantage identified through points 1-4 above. There may however be some new surprises that are causing speculators to get on board today. We’ll see what tomorrow brings.
Special “Thank-You” to subscriber “Nathan” for flagging us early today on the YRCW volume surge.
Your – Stock Market Companion
—————————————————————————————————————————————————
Please remember – at the Stock Market Companion we do not and cannot give individual investment advice. According to the State of Washington RCW 21.20.005 the Stock Market Companion is not a Registered Financial Advisor and we do not render any advice on the basis of the specific investment situation of a particular individual. This information is for a wide readership and is not intended for any particular individual, and under no circumstances should our SMC Intraday Update, SMC 15MinuteStocks Market Update or Watchlist be considered an investment recommendation or plan for any specific individual. By accessing this material, you agree that the Stock Market Companion will not be held liable for any actions taken by a subscriber or other parties. Please seek the counsel of a broker or other licensed investment professional for accurate pricing and concerning the suitability of all investments that you may be considering. Disclosure : Please understand that the Stock Market Companion may hold positions in the above mentioned securities. Based on market related or personal events these positions may change without notice.
– Stock Market Companion – Current Holdings –
| Nr. | Co. | Ticker | Action | Entry Date | Current Gain (Loss) |
| Intel Corporation | INTC | Purchased Today | 1-25-2011 | +1% |
– Stock Market Companion – Performance –
Please click on this chart to see the Stock Market Companion 15MinuteStocks stock performance versus the SP-500. It will open in a separate browser window.
* Gains (losses) do not include brokerage fees. Our returns are very strong … BUT … WE have to remind everyone just like all other financial sites in America – Past Performance is No Guarantee of Future Returns. Unlike others however, our objective is to teach you to be able to make these types of strong returns On Your Own.
All of the investments – stocks, entries, and exits are listed on our Stock Market Companion Watchlist at the bottom of the spreadsheet, in the section labelled Former Holdings.
– Benchmarks “At a Glance” –
US Dollar |
1.3684 USD = 1 Euro |
USD / EUR |
Dollar = Flat |
Gold |
$1,331.90 |
Ounce |
Gold = Down |
Oil |
$86.21 |
Barrel (West Texas Crude) |
Oil = Down |
30 Yr. Fixed Mortgage |
4.82% |
Percent |
Flat |
10 Yr. Bond Yield |
3.31 |
Percent |
Flat |
1 Yr. CD |
1.36 |
Percent |
Flat |
Data Source : Financial Visualizations Inc.
Signing-Off for Today,
Your -Stock Market Companion
** Stock Market Companion Disclaimer **
The Stock Market Companion (SMC) Market Update and Watchlist are published documents to subscribers that show how we (SMC) are viewing the markets and what we are watching, investing in or selling today. This information is for a wide readership and is not intended for any particular individual, and under no circumstances should this Market Update or Watchlist be considered an investment recommendation or plan for any specific individual. By accessing this material, you agree that the Stock Market Companion will not be held liable for any actions taken by a subscriber or other parties. You understand that the Stock Market Companion holds positions in the above mentioned securities. Based on market related or personal events these positions may change without notice.
Furthermore, the Stock Market Companion, Inc. is a content provider and publisher and not a registered broker-dealer or licensed investment professional. Our intent is to publish very accurate market information for an audience of subscribers (1000+ subscribers). By accessing the Stock Market Companion website and/or using the Stock Market Companion products and services such as this Market Update and accompanying Watchlist, you understand and agree that the material provided in the Stock Market Companion products and services is for informational and educational purposes only, and that no mention of a particular security in a Stock Market Companion product or service constitutes a recommendation to buy, sell, or hold that or any other security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. To the extent any of the information contained in any Stock Market Companion product or service may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person. Before selling or buying any stock or other investment you should consult with a qualified broker or other financial professional to verify pricing information and to solicit advice as to the appropriateness of a given transaction or investment.
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