John Burke

Market.The market cares about earnings, not government policy. The numbers have been consistently good, whether they are earnings or economic numbers. Factory orders were incredibly good. Also, the housing market is starting to pick up. Earnings are good because the world economy is in unison. All the major economies are presently charging forward. There are still cheap stocks out there to buy.

This is now run by the same guy that was a CEO in the breakup of Tyco. He did a great job, so expectations are high. Studies show that companies that are spun off, typically do well. He would wait, because these companies are going to spend money, so the upfront pain is going to be in the first half of the year, and numbers are not going to look that good. Sometime, during that first year, he is going to look to Buy some of this.

Sell?This company has a very high free cash flow yield and is very profitable. Have some drugs coming off patent, but biotech drugs generally survive the loss of patents because the drugs are hard to copy. Thinks you will be fine with this in the long run. 2.6% dividend yield.

Up a little less than 40% for the year. Has done fabulously well because they’ve convinced consumers their product is the product to have. The concern is that there is nothing they make, that somebody else can’t make at half the price. The history of consumer electronic companies is not very good.

You have the declining paper sales. People are using iPads, and don’t need paper. On the other hand, they make packaging, and sales are going up because of Amazon (AMZN-Q) and e-commerce. Looking at earnings and free cash flow, it looks like their growth from packaging is beating out the loss of revenues from paper. You also get a nice dividend of 3.3%.

Hold a stock until the X dividend date, Sell and move into another stock, and do the same thing again?This has been done by some institutional investors, but it is tough to make it work. Once a stock goes X-dividend, it knocks the stock price down by the amount of the dividend, so you really didn’t get anywhere. Not a strategy he would pursue.

Banks are levered by about 10 to 1. In the heydays of 2007, they were levered over 30 to 1, which is why many of them collapsed. A 10 to 1 leverage is a lot of leverage. They are good as long as the depositors don’t pull out the deposits. This bank is not back to where it was. They did a huge reverse split. He would suggest risk-adverse clients stay away from banks.

This is a stock that just keeps going up. The dividend right now is $3.61. If you go back 10 years, the dividend was $1. 10 years prior to that, the dividend was $0.15. When you get a stock that keeps on increasing dividends like that, and you get a chart like the current one, that is what you want to have in your portfolio.

(A Top Pick Aug 22/16. Up 72.36%.) A financial company, but unlike banks, it is not highly levered. It is basically in insurance business, more so they are in the business of providing financial advice for a fee.

(A Top Pick Aug 22/16. Up 54.49%.) A small-cap bank. If you are risk averse, he would advise you to get out of the stock. If not, the story is still good. Thinks there is still some upside, especially if interest rates go up.

(A Top Pick Aug 22/16. Up 50.26%.) This is really 2 companies, insurance and a provider of 4O1K in pension plans, which is a great business. There was some concern about this company, because of new regulations from the Obama administration, which have been delayed for about 1.5 years. Has a terrific cash flow.

If you own healthcare providers, especially in the hospital supply area, they have been great stocks for a long time. We are all getting older and need more help. Prefers Medtronic (MDT-N) a little better. However, this is another dividend growth story, so you can’t go wrong here.

This has 3 things going for it. It is an international stock being Swedish, and European stocks have been stronger than US stocks for the 1^st time in 10 years, and that should continue. Secondly, it is in healthcare which he likes. Thirdly, they’ve been doing a lot of research in immune boosting therapy, helping people fight cancer. This is going to be huge as we have so much further to go in fighting this scourge.

$1.8 billion a year is how much cash they are burning through. That is not good. Also, there are over 30 automobile manufacturers globally. He doesn’t like buying a company with that much competition. Even their competitors are bringing out electric cars. Lithium is very poisonous and the batteries are in the bottom of these cars, so what is going to happen to the batteries after they have finished with their useful life.

Has a terrific free cash flow yield. It is a defence contractor. If you own, you’ve done really well. As long as international governments are not relying on the US to defend them, it seems there is going to be a lot of defence buying by countries such as Japan.