newplasmalg.com Financial Commentary: Coverage Initiated

March 28, 2008

Coverage Initiated - Financial Services

As I have discussed in the past, I keep up with a cross section of stocks from every sector and industry. However, most of my in-depth research and interest for the purpose of this site lies in the financial services sector. With that sentiment in mind, I intend to use this medium to regularly discuss their valuations, news, and corporate strategies. (Note: I do reserve the right to occasionally discuss stocks outside the financial services arena that I believe are attractive assets and my conviction list will be constructed with stocks from every sector) The firms I will cover in depth on this site:

Investment Banks - Bear Stearns, Goldman Sachs, Lehman Bros., Merrill Lynch, & Morgan Stanley

Asset Management - Lazard, Och Ziff, & Blackstone

Money Bank Centers - Citigroup, Bank of America, JP Morgan, Wells Fargo, & Wachovia

Investment Brokerages - E-trade, Schwab, & TD Ameritrade

You can download my comprehensive list:

Download ag_financial_services_overview.pdf

Posted at 12:40 AM in Corporate Finance | Permalink

Conviction List

BUY Goldman Sachs (ticker: GS)
Recent Px: $180
12 Mo. Target Px: $230
Goldman Sachs is a "best of breed" firm that prints money like no other on Wall Street. Trading at 9 times next years earning there is no reason to see this stock going lower than recent volatility has suggested. Recent earnings announcement surpassed analyst expectations. I would expect them to continue doing so. Buying in the 160s or lower would be a good buy.
SELL Bear Stearns Corp. (ticker: BSC)
Recent Px: $10
12 Mo. Target Px: N/A
JP Morgan got a heck of a deal and even felt bad about their initial offering price that they raised the bid from $2 to $10 per share. I guess it always possible that the deal falls apart and other outside bids are submitted but not without losing their building. Its a virtual lock at this point. Therefore, I think its time to look elsewhere.
BUY Ultra Petroleum (ticker: UPL)
Recent Px: $78
12 Mo. Target Px: $100
Ultra Petroleum's knack for oil and gas exploratory success makes this name a "must have" in the portfolio. This Houston-based firm has interests and business in Green River Basin, Wyoming, and offshore China.
BUY iShares China 25 (ticker: FXI)
Recent Px: $145
12 Mo. Target Px: $175
Chinese economist have forecasted a 11% growth in GDP for this year...and that comes on the heels of a slowing US economy. One word: "WOW!"
BUY Dow Jones Ultra 200% Index (ticker: DDM)
Recent Px: $70
12 Mo. Target Px: $88
Goldman superstar Abbey Cohen has predicted that the DJIA will see 14700 this year. With that logic and her call in mind, then consider using the 2:1 magnification etf that is based on the Dow's performance.

March 28, 2008

Coverage Initiated - Financial Services

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