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Bargain nr.1 of 10


There are many companies that promise and make rosy presentations about their future.

I found CMZ, the guy was predicting steep growth and guess what ? It didn't work out.He was right with a steep growth - companys debt has increased sharply:-)

Another company UUU.TO was promising growth and large reserves they were right,but it didn't work out as well.
They couldn't make it into production.

If you want to see what can happen when things get nasty and company is weak check JRCC .They survived ,but only by the chance of luck.

I stopped buying these promises. Lets talk real - lets talk cash.

My first stockpick is ExxonMobil (XOM). 

Company has no debt,but thats not all company has $6 cash on each stock. What is unbelievable is how much cash it produces on each outstanding stock roughly $8 dollars.

It means that you pay $82 ($88-$6) for a share that produces $8dollars every year . That gives you 10% cash yield!

This is my goal to find another stocks that give you 10% cash yield.

Anyway,company knows what they should know- they are focused on return on capital. Their efficiency is brutal and their CEO is not loading itself with stock options. 

So, I will add XOM to my pelcmarek2 portfolio on monday. The price now 30/5/2008 is $88.76/share. 
   
Cool

PS: dividend /share rose from $1 a share 2003 to almost $1.50 2008.

First I count value and then I compare it with price.

How much debt company has ?                        10.01  B
How much cash company has ?                        41.39  B
What is difference between cash and debt?        31.38 B

What is the cash flow company generates ?             43 B
What is 10x cash flow company generates?            430 B

How many outstanding shares company has ?       5.28 B

What is the value per share? (430+31.38)/5.28= $87.3

 
Because value of the stock is $87.38 and price of the stock is $85.7 stock is cheap !

Stockholders 2002  2003  2004 2005  2006   2007
equity           74.5   89.9  102   111    113    122

Stock's P/E   2002  2003  2004 2005  2006   2007
                   21.7   13     13     9.8    11.6    13.6

By pelcmarek at 2008-05-30 17:28 | Stocks | pelcmarek's blog


What the Fuck ?!

by Chris Krasowski

Exxon Mobil reported second-quarter earnings of $11.68 billion today, the biggest quarterly profit ever by any U.S. corporation, but the results fell short of Wall Street expectations and shares fell in premarket trading.

A record profit for Exxon Mobil, but nonetheless an increase year-over-year that was smaller than expected by analysts. Smaller?!?

Give me a f***ing break: that's nearly $1500 a second! And nonetheless the Street is not impressed!

To put things slightly in perspective; Exxon could buy Ford (F) outright from this quarter's profit alone, or it could almost buy General Motors (GM)  twice over.

Oh, and the company is also buying back a further $8Billion in stock, and it yields about 2%, and should be in a PE range of approximately 10-12 currently. Did I mention almost $12Billion in quarterly profit?!

By pelcmarek at Thu, 2008-07-31 17:20 | login or register to post comments