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New York -
On January 1 of each year
- we publish 10 stocks that our research analysts believe will outperform the S&P 500
Index for a three to five year period. Trading
costs and dividends are excluded from our results because they impact the net after-tax
investment performance on an individual basis. Here are the stocks and our
investment themes:
|
1 E*Trade
(EGRP)
|
| Rating: |
BUY |
Original
Comments: E*Trade continues to be one
of the leading on-line discount brokers. Sooner or later - this stock will be acquired by
a large bank or broker. If not - it will continue to dominate the online business and
expand overseas. If a bear market occurs - trading of stocks will slow down and so will
this stock. Hold onto your seats but we will go with this stock at $11.69
(split adjusted) |
| Last
Review: |
12/31/99 |
| 1/1/99
Price: |
$12 |
| Recent
Price: |
$26
1/8 |
| Update:
If you believe in the growth of
online financial services, we
believe this is still one stock to own. |
|
2 H&R
Block (HRB)
|
| Rating: |
BUY |
Original
Comments: HR Block continues to focus on generating more
revenue from their tax stores. They have purchased mortgage brokers, financial planners
and accounting firms. It has an underutilized brand name and may be looking to partner
with a dynamic company such as Intuit. The yield of 2.2% as of January 1, 1999 is not too
bad either. A buy at $45. |
| Last
Review: |
12/31/99 |
| 1/1/99
Price: |
$45 |
| Recent
Price: |
$43
3/4 |
| Update:
The
Company is well positioned for a record 2000 Tax
season. |
|
3 Humana
(HUM)
|
| Rating: |
BUY |
Original
Comments: One
of the largest HMOs in the country. The company was almost
purchased for $38 per share. The merger fell through and the
stock bombed. Market overreaction has left us with a great
stock to buy at $17 13/16. |
| Last
Review:
|
12/31/99 |
| 1/1/99
Price: |
$17.81 |
| Recent
Price: |
$8
3/16 |
| Update:
Humana
remains a value contrarian play and has been added to our Year
2000 contrarian portfolio. |
|
4 AMERICAN
EXPRESS (AXP)
|
| Rating: |
BUY |
Original
Comments: A repeat from our 1998 stock picks. American
Express continues to be rewarded with our admiration and recommendation. American Express
continues to make acquisitions of accounting firms which are non-dilutive to EPS. In fact
- they are pretty positive. As long as this trend continues - this stock will continue to
shine. |
| Last
Review:
|
12/31/99 |
| 1/1/99
Price: |
$102.5 |
| Recent
Price: |
$166
1/4 |
| Update:
After two years on our recommended list, we remove the company
as of 12/31/99. The recent introduction of the
"Blue-Card" does not sit well with us.
No one we know has the blue card. |
|
5 INFORMIX
(IFMX)
|
| Rating: |
BUY |
Original
Comments: Another repeat from our 1998 stock picks. We
called Informix to double and we were wrong. It more than doubled and increased 108% in
1998. Informix is a revitalized company. We see Informix being acquired during 1999 which
will reward investors who hold onto this stock.. |
| Last
Review:
|
12/31/99 |
| 1/1/99
Price: |
$9.875 |
| Recent
Price: |
$11
17/16 |
| Update:
As the #2 player
in a competitive market, we would take our profits on this database software
provider as of 12/31/99. |
|
6 CITIGROUP
(C)
|
| Rating: |
BUY |
Original
Comments: This is a huge global company that has only started to think about what it
can do. Citigroup has offices in Rome, China and Moscow. You know - the saying - when in
Rome do what the Romans do. Well if Citigroup is everywhere ... well you get the picture. |
| Last
Review:
|
12/31/99 |
| 1/1/99
Price: |
$33.125 |
| Recent
Price: |
$55
11/16 |
| Update:
The
Company continues to trade at a discount to its peers and
remains a Top Selection for Year 2000. |
|
7 USA
Floral (ROSI)
|
| Rating: |
BUY |
Original
Comments: USA Floral is the word's largest distributor of
flowers. Customers include Wal-Mart, K-Mart and small retail stores all over the World. It
is profitable, has assembled a good management team and is looking to increase
profitability, revenue and all sorts of goods stuff. At $11 5/8 - we expect this stock to
be a double in 1999. |
| Last
Review:
|
12/31/99 |
| 1/1/99
Price: |
$11.5 |
| Recent
Price: |
$2
15/16 |
| Update:
We blew
this. Management was not up to the task of integrating local
distributors and incorrectly forecasted the impact of price
cuts. Sell the stock and take the loss.
|
|
8 AT&T
(T)
|
| Rating: |
BUY |
Original
Comments: Everybody is saying that MCI/WorldCom will be the
telephone company to beat in 1999. We think AT&T has a fighting chance. The Company is
investing huge sums of money in the wireless market, the cable market and the Internet.
This will drag down earnings but if management can pull this off - this stock will shine
over the next few years. With a dividend yield of 1.74% - we can buy and hold.. |
| Last
Review:
|
12/31/99 |
| 1/1/99
Price: |
$50.5 |
| Recent
Price: |
$50
13/16 |
| Update:
A
broadband play in Year 2000.
|
|
9 FORD
(F)
|
| Rating: |
BUY |
Original
Comments: We believe the automobile sector continues to be
undervalued. With a PE ratio of about 10, a dividend yield of 3.14%, we just could not pass
this up. A buy at $58 11/16. |
| Last
Review: |
12/31/99 |
| 1/1/99
Price: |
$58.68 |
| Recent
Price: |
$53
5/16 |
| Update:
Ford is a value play and will continue to reward patient
investors.
|
|
10 TEXACO
(TX)
|
| Rating: |
BUY |
Original
Comments: If Mobil was cheap enough to be bought by Exxon.
We believe that Texaco is cheap too. At $53 - this stock yields 3.4%. Cheap oil will be
around for a while. As Texaco gets more efficient and adjusts to the new price
levels, earnings and the stock will increase. If oil prices increase again - this could be
a double very quickly. |
| Last
Review:
|
12/31/99 |
| 1/1/99
Price: |
$53 |
| Recent
Price: |
$54
5/16 |
| Update:
Gas goes in your car and should go in your stock portfolio. A
simple thought but one that we practice here. Although
the stock has not moved in 1999, we still like this one.
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here for current stock quotes on all companies
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