Latest Expert Opinions

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Opinion
Expert
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May 11, 2016

This has been a well-managed company for some time. What you are buying into is a very high beta of 1.45, meaning it is 45% riskier than the market. He would avoid the stock because there is too much volatility. Also, one of their major inputs is fuel, and feels the price of oil is not done going up. There will be a better chance to get this in the near future.

This has been a well-managed company for some time. What you are buying into is a very high beta of 1.45, meaning it is 45% riskier than the market. He would avoid the stock because there is too much volatility. Also, one of their major inputs is fuel, and feels the price of oil is not done going up. There will be a better chance to get this in the near future.

John Burke
CEO & CIO, Burke Financial Strategies
Price
$75.120
Owned
No
DON'T BUY
DON'T BUY
May 11, 2016

There are 2 cautionary notes on this. 1.) They have offered a partnership. Canadian investors who buy US partnerships are subject to a 35% tax on the dividend. However, they now offer a share class that is not a partnership. 2.) Richard Kinder is the CEO. He was the president of Enron. Has grand ambitions, and is more interested in making the company big rather than making shareholders rich.

There are 2 cautionary notes on this. 1.) They have offered a partnership. Canadian investors who buy US partnerships are subject to a 35% tax on the dividend. However, they now offer a share class that is not a partnership. 2.) Richard Kinder is the CEO. He was the president of Enron. Has grand ambitions, and is more interested in making the company big rather than making shareholders rich.

John Burke
CEO & CIO, Burke Financial Strategies
Price
$17.060
Owned
Unknown
COMMENT
COMMENT
May 11, 2016

He would rather own advertising companies in the consumer discretionary sector. You get a better dividend and a smoother ride.

Staples (SPLS-Q)
May 11, 2016

He would rather own advertising companies in the consumer discretionary sector. You get a better dividend and a smoother ride.

John Burke
CEO & CIO, Burke Financial Strategies
Price
$8.460
Owned
No
COMMENT
COMMENT
May 11, 2016

Wouldn’t own this stock. He has clients that own it, and they are going to start selling it. The signs are in that the company has finally hit the end of the road. Their problem is that their products are very expensive relative to their competitors, so profit margins are very high. The P/E ratio is not very high. The only way the stock is going to continue to go up is 1) to convince you to buy a new iPhone every 2 years or 2) invent a new device. Early signs are that the Apple watch is not moving the needle.

Apple (AAPL-Q)
May 11, 2016

Wouldn’t own this stock. He has clients that own it, and they are going to start selling it. The signs are in that the company has finally hit the end of the road. Their problem is that their products are very expensive relative to their competitors, so profit margins are very high. The P/E ratio is not very high. The only way the stock is going to continue to go up is 1) to convince you to buy a new iPhone every 2 years or 2) invent a new device. Early signs are that the Apple watch is not moving the needle.

John Burke
CEO & CIO, Burke Financial Strategies
Price
$92.510
Owned
No
DON'T BUY
DON'T BUY
May 11, 2016

Healthcare is a great sector, but the worst performing one year-to-date. Politicians are talking about capping prices for healthcare manufacturers, which doesn’t help. More importantly, Medicare and Medicaid US administrations are trying to cap prices and this one is being hit particularly hard. There are better names in this space.

Abbott Labs (ABT-N)
May 11, 2016

Healthcare is a great sector, but the worst performing one year-to-date. Politicians are talking about capping prices for healthcare manufacturers, which doesn’t help. More importantly, Medicare and Medicaid US administrations are trying to cap prices and this one is being hit particularly hard. There are better names in this space.

John Burke
CEO & CIO, Burke Financial Strategies
Price
$38.010
Owned
Unknown
COMMENT
COMMENT
May 11, 2016

This is getting very interesting. The company has been painted with the story that it is a failed company and nobody is buying Xerox machines anymore. They peaked in 2000 and has been straight down and flat lined since then. It looks like they have gotten to the point where revenues have finally stopped going down. Have around $17-$18 billions of revenues. They are in 2 divisions. Documentation of outsourcing and IT consulting. Hasn’t bought the stock yet, because he doesn’t entirely understand what they do.

Xerox (XRX-N)
May 11, 2016

This is getting very interesting. The company has been painted with the story that it is a failed company and nobody is buying Xerox machines anymore. They peaked in 2000 and has been straight down and flat lined since then. It looks like they have gotten to the point where revenues have finally stopped going down. Have around $17-$18 billions of revenues. They are in 2 divisions. Documentation of outsourcing and IT consulting. Hasn’t bought the stock yet, because he doesn’t entirely understand what they do.

John Burke
CEO & CIO, Burke Financial Strategies
Price
$9.290
Owned
No
COMMENT
COMMENT
May 11, 2016

A very difficult stock to get your hands around, because like any high growth stock, it has a 70 P/E ratio. They could come out with profits that are 20%, and yet the stock could go down, because the market was expecting greater growth than that. For him, it is just too dangerous. It is really difficult to beat the market over time, but you can match the market with less risk, by focusing on companies that are more value priced, and this one is definitely not value priced. There are better ideas out there.

A very difficult stock to get your hands around, because like any high growth stock, it has a 70 P/E ratio. They could come out with profits that are 20%, and yet the stock could go down, because the market was expecting greater growth than that. For him, it is just too dangerous. It is really difficult to beat the market over time, but you can match the market with less risk, by focusing on companies that are more value priced, and this one is definitely not value priced. There are better ideas out there.

John Burke
CEO & CIO, Burke Financial Strategies
Price
$730.550
Owned
No