HSII - Heidrick & Struggles Intl Inc - Small cap special. Rough year for this stock. Recently torpedoed by disappointing first quarter results. Perfect example of investors focusing on the wrong data. Earnings are irrelevant, cash is king - Warren Buffet. Cash flows are very strong. The business has an excellent franchise. Int'l opportunities are huge as emerging markets continue to develop and start to look for more than just factory workers. Current valuation makes it a steal as stock price implies the profits will never grow again.
Sunoco: SUN
SUN - Sunoco - trading at ridiculously low level of valuation relative to cash flow. The current price implies profit will drop by 80% and never grow again. Our research shows SUN's economic cash flows are rising, not falling. SUN is one of the most profitable companies in the market based on Return On Invested Capital. Demand for oil may be softening, but it is not plummeting by 80%.
SELL:
AVB - AvalonBay Communities - big-time misleading earnings. Last year AVB reported that Net Income rose by $91mm while our research shows cash flows declined by $127mm. Making matters worse is the market's expectations for future cash flows - which are very high. In fact the current stock price implies that AVB is going to grow revenues and profits at over 6% for each of the next 60 years. The 5yr avg growth rate for AVB is 4%.
PRGO - Perrigo Company - for every $ of net assets, management has written off 35 cents, not a good track record for creating value for shareholders. Making matters worse, the valuation of the stock gives me a nosebleed as it implies that the company's profits will grow by 1000% next year. The stock's valuation has risen to giddy heights.
CrisisOasis Channel Does the economy have you feeling blue? Tune in here and relax to a never-ending stream of soothing sounds, confident that WBBM NewsRadio 780 is watching the economy and reporting to you 24 hours a day.
Chicago's Reputation On The Run The Chicago Marathon Race director, Carey Pinkowski, says this is a good example of how Chicago could handle the Olympics.The 26.2-mile course starts in Grant Park near Buckingham Fountain, then heads to the North, West and South Sides before returning to Grant Park. A CBS Radio report.
Transit Hikes At Issue The Chicago Transit Authority may not be the only transportation agency planning to hike its fares. WBBM's Craig Dellimore reports. RTA Chairman Jim Reilly and CTA President Ron Huberman are the guests on WBBM NewRadio's At Issue program, heard tonight at 9:30.
Weis Attends Roll Call In a move to shore up morale among rank and file police officers, Chicago Police Superintendent Jody Weis attended a roll call for officers last night across the street from where a teenage girl was fatally shot a week ago on a CTA bus.
G7 Ministers Meet with Bush President Bush Saturday morning emerged from a meeting at the White House with G7 finance ministers. It's the latest attempt to ease market fears and encourage banks to lend money. A CBS Radio report.
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