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We dont get too much into large -cap stocks..But we will strongly recommend this 9 billion dollar cap stock..DGX…Quest Diagnostics.You can look at the past 4 quarters of earnings and they have beaten them consistently..They are a Lab Test Result company whose attributes are running tests on blood count,commercial clinical testing results,pre-natal and pregnancy testing,macro biology testing,and alcohol and substance abuse testing among other health care applications in their portfolio..
They will in my opinion survive this credit crises very well..I am going to do something that I generally dont write about –the actual past earnings to estimates–this without revisions..The 1rst quarter of 2008-average estimate of EPS-70 cents a share..EPS actual-72..Beat..2nd Quarter EPS average estimate of EPS-79 cents a share..Beat-actual–83 cents..3rd Quarter–82 cents–beat-actual 84 cents a share of EPS..And the 4th quarter–80 cents–beat by 7 cents-actual EPS was 87 cents a share..Beat from a low of 2.4 % on the low end of one of the quarters to a high of 8.8% cent on the high end of the quarters–this being quarter 4-the most recent..The average mean is 4% beating the average estimate on 2008 earnings for each quarter..
Enough said on earnings from 2008..The key is where do you buy DGX ..It was 46.58 a share the Friday before the Monday Jan 26 earnings that really beat the forecast..It is now 50.58 -up around 60 cents in the beginning of the opening today-February 24,2008.We have both talked to each other about this company and its competitor LabCorp-LH.This company has a stronger balance sheet than even DGX..I recommended BOOM yesterday..Watch this stock rise in the near future..Its up about 3% today..We will due our due diligence on DGX with an earnings calculation to see a good entry point –right now I wouldnt touch it yet..Wait to see if there is a pullback..
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We have answered many family members about our recommendation of SNHY..We are recommended this one as a long term hold..We see near term weakness but it is well position to survive this year and will thrive in 2010 in our opinion..Dont invest in this stock if you are a short term player..It did miss last earnings by 1 cent in quarter 3..Management gave a conservative picture of weakness in 2009 but well-positioned in the long haul to thrive a weaker forecast this year..Its cash position can recover a little weakness this year due to a highly demand product..Its unique niche is what I like about it that isnt like a highly-concentrated product line like an auto company..SNHY deals with hydraulics which hydraulics in in itself is basically in 6 major sectors that involves control,force and power in cartridge valves as an integral part of fluid power systems in the US and abroad and its a small cap stock at that. Do your own research.Hydraulic valves is one of its general product lines..A filthy stock-or greasy one..Again,of the ones I recommend,I will say this will be generally weaker than the others this year in the near term….About 3 weeks to 5 days before quarter 1 earnings of 2009 of DGX -we will look at its share price–if we see a good price –we may recommend it there..Right now –we will keep you updated on DGX..It is better to miss a ride up –than grab one only to hit a bump or dip..Its next earnings should be toward the 3rd week of April 2009.
Remember folks..Keep the powder dry..Dont invest all in in this market..We have opportunities we believe in the future–this isnt the time to add a lot of capital even to these recommendations we have made..These recommendations will very well drive lower after our recommendations..We will tell you an exit strategy if you have invested in some of our recent recommendations..Some of our recommendations are short term in nature and can change without notice..Remember the market we are in..Most of the time our strategies will be based on conservative estimates of earnings growth and the sell signals we give are slightly to quite below its projected upside in earnings growth to protect those who have invested in our recommendations.Also a quick run up in price may mean a sell signal as well..We may be very wrong in some of our recommendations so see our disclaimer about this..Also,our worst caveat is to say ‘sell’ way after that point where it was a good call to sell which thus gives a haircut in what may have been a great profit on an investment..In this environment,we would rather be wrong to the slight downside of a price appreciation of an equity than to give a ‘sell’ recommendation way too late in a downward spiral of a stock in its share price..We have discussed to each other how many restaurant stocks will rise as people get there tax refund checks..We have discussed this in January 2009.However,since then one has blasted off–BWLD -Buffalo Wild Wings and I wouldnt recommend it here.Wall Street knows in advanced such food industry stocks will show good earnings due to tax refunds..Our next blog will be soon on such a stock and when to buy…If we find any that is very cheap..
Mike current owns shares in SNHY but not in DGX and BWLD and LH..Mike would possibly like to own DGX in the near future and possibly LH..Rob doesnt own SNHY,DGX,BWLD and LH..Rob would possibly like to own DGX and LX in the near future..Please do your own independent research before you make an investment purchase..See our disclaimer.
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