Category Archives: $MSFT

NASDAQ Closes above 5k! Bail out or Buy more? 2CentView …….

Can the NASDAQ power on from here or is this Y2K all over again?

$CSCO traded on a p/e of 100x in 2000 and there was talk it could become the first trillion $ company. Today, it has a market cap of 145bn a p/e of 13 and a growth rate of just 5% over 5 years – so not exactly the same as Y2K.
The Biotech sector is showing some signs of a bubble brewing up – but this is still not on the scale of bubble in 2000.

Mobile Social and BioTech stocks have done well over the past 18 months – PC related stocks have performed poorly – and will probably remain that way as there is no growth in PC – look at $INTC and $HPQ recently…

There are very few bargains left in these hot sectors – the last one $SWKS (Skyworks) which was an incredibly cheap stock at $60 when 2CentView tweeted the name back in November 2014, is now $102!

Value names in various Sectors:

PC’s
Keep away from PC Stocks for now – if you do want to buy, $MU is the cheapest.
$MU FV = 38
$HPQ FV = 35 Yield 2%
$INTC FV = 29 Yield 3%

Mobile/Social/Internet of things/Wearables
$GOOG FV=600 – was a great opportunity to buy when below $510
$MSFT FV= 45 – if you think they can move out of their depdendence on the PC
$CSCO FV=30 – buy some for the yield of 3% and potential in the internet of things – implied growth still very low

Internet Software and Services
$BABA FV=120 – includes $20 cash – implied growth 25% vs 45% on $AMZN
$Z FV=108 – Spencer RasCoff is a great young CEO
$YELP FV=70

Biotech/Pharma
$GILD FV = 109 also pays dividend! HepC is competition is heating up though!
$JAZZ FV=189 – could be the next pharma take out!

Solar
$CSIQ FV=60 [see earlier tweet on this name ]

2CentView has core positions in $AAPL, $GOOG, $FB [3 best tech companies in the world!], also $TWTR, $ISIS, $CELG , $GILD and $FEYE

2CentView FVs are calculated using a proprietary earnings based model which has been calibrated to determine a fair vlue stock price today. It is based on consensus analyst predictions of future earnings – these are predictions only and may not play out in the real world. It is designed to identify mispricing between the stock price and future earnings potential of the company. The model has helped 2CentView realise a 35% annual gain over the past 2 years.

Old tech stocks $MSFT and $HPQ rallying..if you missed these $CSCO may be worth taking a look….

Looks like there is some rotation out of Growth stocks into more safer stocks – which should do well if the broader US economy does well.

2CentView has been bullish in $HPQ since 29 area – as it is cheap and should benefit from a broader US Economic expansion plus cheap way to get into the potential of 3D printing.
FV=36 now with stock 32.5.

$MSFT has also had a nice run, hitting $40 FV=$31 + $9 in cash.

Another name which should do well if the broader economy does well is $CSCO (Cisco Systems).
With $30billion in cash, FV = 22 + 5 (Cash) = 27. At $21 stock yields 3.5%!
Some value stocks stay cheap though especially if management are too slow to take advantage of new markets such as cloud – they just announced a play into Clould – 2 years too late!

However, internet security has big potential and $CSCO should look into entering that business.

UK Budget – Pension Shakeup “We plan to overhaul the system completely”…..

The government made a huge change to pensions – from 2015 you can do what you want with your private pensions at 55 subject to marginal tax rate. This mean that you are NOT forced to buy a stupid Annuity or have income drawdown restrictions on your personal pension!
Download the udget_2014_greater_choice_in_pensions_explained.pdf from the government web site.

For example if you had 400k in your private pension then take 100k as cash tax free, the rest you can take out subject to normal tax rate in that year – so if you have retired at 55, and take out only 10,500 you pay no TAX!.

Hargreaves Landsdown stock – the provider of SIPPS rallied 15% on the news and the annuity providers were sold off – it is anticipated many more will contribute to SIPPS.
So plan to have 400k at least in your private pension by 55 – then sell the Porsche for a LAMBO! or pay any debts on your buy to let portfolio or buy the villa in south of france…..its entirely up to you..

Construct your portfolio now of the following:

Recovery plays – Good Companies which are broken but are coming back.
Stocks below have made dramatic gains in less than 3 years:
Sports Direct 60 o 800
Thomas Cook 20 to 180
SuperGroup 300 to 1700
DIxons 20p to 50p
HPQ 12 to 30
RiteAid: 1.50 to 6.50

2CentView model identifies when broken companies earnings expectations are expected to rise but the stock price has not reflected this change.

Low Beta Income stocks

BP, DLG, Scottish and Southern – now SBRY.
Buy these companies when there is potential upside of 15%-25% and dividend carry of between 4 and 6%. e.g. $SBRY FV=360, carry = 6%!

Growth Stocks
the Hardest to play – you need to know what you are paying for the growth and whether you think it can meet these expectations (use the PEG as a guide). If you are right gains will be big, but so also is the risk – the stock will be savaged and you will lose a lot if the company fails to meet the expectations.
Important to stick to stops on these.
2CentView model shows that growth stocks fall into 4 categories (over 5 years): low (5-15), moderate (15-35), High (35-50), Super(50-80)

Low: Apple, MSFT, HPQ, IBM, Oracle
Moderate: Google, GOGO, FSLR
High: FaceBook, AMZN, NetFlix, Tesla, GIMO
Super: FUEL, Twitter

$BBRY up another 8% – Ford switches to QNX from $MSFT for Sync ..is it worth buying?

Have to a look at the sum of the parts valuation for $BBRY – like $YHOO.

Below is ROUGH Guide!

Major Assets are:
$2.2bn CASH – but this is expected to burn down to $1bn before $BBRY become profitable..
$4bn revenues from Enterprise revenue – assume 30% Margin – business is worth around $1bn p.a.
BBM – 80mmusers – $FB paid $42 per user for WhatsApp, if we assume $10 per user could be worth between $750 to $1bn max – but who would be willing to pay for BBM?

At 10.60 the market cap is 5.58bn – the market is applying a Multiple of 3.5x to the Enterprise Business – this does seem a bit low – but there is uncertainty whether the Enterprise business will become a viable business.

There are 2 ways to look at $BBRY –
Bull case:
Blackberry is still well entrenched with the US Government – the Z30 is actually a fantastic phone – and they still do well in Emerging Markets. The Enterprise business is on a low multiple and BBM could be worth a lot more and QNX is well entrenched in the major Cars. If you believe in this, stock could double.

Bear:
BBM is worth nothing, Enterprise revenue will die away and the company will not survive the next 3 years.

2CentView is that If you are in the BULL Camp, Buy HALF your intended position here and the other half at 8 if it gets there, averaging in at 9. Take profit Target (TP) = $17, Stop 5.

$MSFT new ceo will focus on cloud and mobile…fv=39 if you in include 80bn in cash….

Nadella (which always make think of nutella my favourite choc and hazelnut spread) is a much better choice than mulally (who is a brilliant ceo but not right for msft) but will find it tough catching up with $GOOG ..balmer missed the move to mobile and social but managed to get into the cloud which under nadella revenues doubled to 600mm dollars last year.

2centview is that microsoft’s problem is windows architecture is not good enough to support the huge demands mobile apps will have on data and cpu….they need to rewrite it from the ground to support the next generation of mobile apps.

The stock is fairly priced at 36.5 and an entry point would be closer to 30 unless you believe in nadella will catch up more quickly with the competition then buy it now…

Sent from my iPad on airbus 380 using on air wifi

$MSFT – good results – is old tech dead? Some FVs of Old tech Companies

$HPQ FV=34
$MSFT FV = 30 – results show PC is not completely dead
$IBM FV= 200
$INTC – FV= 20
$ADBE FV= 75
$EBAY FV= 45 – icahn declared big stake.

2CentView picks are
$HPQ – only half way through a turnaround strategy being well executed by Meg Whitman – upside potential in 3D printing and a recovery in PCs as seen by Intel and MSFT earnings calls. Buy around $29 – PT 34, Stop $25.

and $ADBE – cheap to FV – but current price does imply 40% 5Y growth – but this is a good cloud play.Buy around $60 – PT $75 , Stop $50.