[CANSLIM] Worley's Weekend Weeview

From: "Tom Worley" <stkguru@netside.net>
Subject: [CANSLIM] Worley's Weekend Weeview
Date: Sat, 16 Feb 2002 18:48:14 -0500
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MORE ENRON NEWS
A total of 20,795 employees of Enron were in the 401K plan, and it is =
estimated that about 63% of the plan was in Enron stock. The loss is in =
excess of one billion dollars. It is estimated that most had already =
lost 70 to 90% in the several months prior to the three week freeze =
imposed while they changed plan administrators.=20
- -------------------------------------------------------------------------=
- -------

EARNINGS
For the first time in 15 months, analysts are raising more earnings =
estimates than cutting them. The total raised was 51% for the week ended =
1/25/02.=20
- -------------------------------------------------------------------------=
- -------

ACCOUNTING REPERCUSSIONS
Krispy Kreme, which had planned to shift some of its debt using off =
balance sheet financing, has now announced it will use conventional =
financing. Then there is Newmont Mining (NEM) which got hurt Monday =
after Prudential downgraded it, saying "Several of the deposits that =
Newmont classifies as reserves or resources appear suspect". Want to =
guess who their auditor is??=20

I expect that eventually accounting firms will be banned from doing =
consulting business with the same companies they audit. But meantime, =
most are already changing their practice to follow this. And any company =
with any kind of accounting problem is suffering the hot spotlight of =
the media. Latest to surface include IBM, WCOM, NVDA, AFAM.

- -------------------------------------------------------------------------=
- -------

JAPAN
Total of bad bank loan debt now being estimated at $1.1 trillion, and =
that's given their generous interpretation of what is a non-performing =
loan. Govt debt from deficit spending is already 130% of GDP. And still =
the Nikkei comes roaring back to break 10,000 again, all on hopes that =
the govt is finally moving to bail out the banks. Just operational last =
Friday is the Banks Shareholding Purchasing Corp (BSPC) funded with $15 =
billion to spend to March 31, and another $15 billion for the next =
fiscal year. Money comes from over 100 financial institutions, and will =
be used to buy stocks from the banks rather than have the selling =
pressure hitting the markets. Sounds like a shell game to me, moving =
losses from the banks to BSPC. And still unclear to me is whether the =
sale to BSPC will be done at current market prices, or at original cost =
basis. I just don't see the benefit of a financial institution funding =
BSPC to buy its own portfolio. But somehow the Japanese see this as a =
good thing.

- -------------------------------------------------------------------------=
- -------

ECONOMICS
Retails sales slipped a little (minus 0.2%) in January due expected weak =
car sales (told you late last year they were cannibalizing future =
sales), but the figure beat expectations for sales less cars, rising =
1.2%. Both beat expectations of minus 0.3% and plus 0.4%. In addition, =
December figures were revised upward from a negative 0.1% to plus 0.2% =
and plus 0.7%. The combo of revising all data for December up and into =
positive territory, along with two straight months of strong sales =
(except for autos) is a compelling trend. And even the decline in auto =
sales is soft and expected, given all the zero interest loan incentive =
plans late last year.

New unemployment claims fell a little instead of rising a little as =
expected, further pointing to stabilization in the employment sector.

Overall inventories were down in December 0.4%, just under expectations =
of a 0.5% drop. But excluding autos (which rose 0.1%, another sign of =
just how sales were cannibalized late last year) inventories were down =
0.6%. This was the 11th straight month of inventory declines.

Producer Price Index (PPI) beat expectations (overall up 0.1%, expected =
was 0.2 to 0.3%, and core was down 0.1% against expectations of a rise =
of 0.1%) continuing to signal no inflation, at least at the wholesale =
level. For all of 2001, the PPI dropped 2.6%, biggest drop for 12 months =
since Feb '49-'50.

- -------------------------------------------------------------------------=
- -------

"M"
Don't know if everyone had a week like mine, but I felt pretty bloodied =
and battered by the time Friday's trading was over. Not a good week for =
growth, especially for the small and micro cap stocks. Despite that, for =
the week, the DOW 30, S&P500, and the Russell 2000 managed to close =
slightly higher for the week. And NASDAQ finished less than a percent =
down. Gold began a slide back below $300, no surprise to me who doesn't =
believe this was anything more than a spike in a continuing bear market =
for the precious metals.=20

- -------------------------------------------------------------------------=
- -------

WORLEY'S WATCHLIST WANNABES
As always, Bx means a chart where I see the stock in a flat line "B"ase =
of "x" weeks duration. If I see a specific pattern such as a cup & =
handle, double bottom, LLUR, etc I will say so. And this review is with =
all my blinders and personal biases removed, they are not stocks I might =
personally consider buying. For the most part, I am only considering the =
prior 6-9 months of the chart.

Population of stocks I am reviewing this weekend appears to be stable to =
slightly larger.

AMWD - B2, but may be trying to reestablish its LLUR patter from last =
year
ATK - c&h, triple bottom, handle two weeks long with price spike on =
volume Friday approaching pivot
BPRX - b/o from an 8 week consolidation appears to have failed
BRO - B2
CDWC - B3
CECO - B2
DHI - B3, another home builder
DHOM - B2, another home builder, in my fund
DKWD - rough LLUR
DLX - LLUR
EPIQ - 9 week consolidation base, owned and in fund
FCEA - B8
FCN - the beautiful LLUR pattern may be on its last legs
FLIR - possible c&h
FMAR - B6
GFF - LLUR
GTK - B2
HOV - B7, another home builder
HRB - LLUR
MBFI - B6
MCL - low priced LLUR
NOBL - consolidation, great earnings growth, in my fund
OVRL - B3, I own and in my VR fund, EPS 49
RMCI - c&h, owned and in fund
SHLR - B2, another home builder
SNS - B5
STJ - B3
SWTX - B6, low priced
SYPR - LLUR
URBN - ascending base??
WLS - hummm??, in my fund, another home builder
WSH - B2

Happy Hunting,




Tom Worley
stkguru@netside.net
AIM: TexWorley

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<HTML><HEAD>
<META http-equiv=3DContent-Type content=3D"text/html; =
charset=3Diso-8859-1">
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<BODY bgColor=3D#ffffff>
<DIV><FONT face=3DArial><STRONG>MORE ENRON NEWS</STRONG></FONT></DIV>
<DIV><FONT face=3DArial>A total of 20,795 employees of Enron were in the =
401K=20
plan, and it is estimated that about 63% of the plan was in Enron stock. =
The=20
loss is in excess of one billion dollars. It is estimated that most had =
already=20
lost 70 to 90% in the several months prior to the three week freeze =
imposed=20
while they changed plan administrators.=20
<HR>
</FONT></DIV>
<DIV><FONT face=3DArial><STRONG>EARNINGS</STRONG></FONT></DIV>
<DIV><FONT face=3DArial>For the first time in 15 months, analysts are =
raising more=20
earnings estimates than cutting them. The total raised was 51% for the =
week=20
ended 1/25/02.=20
<HR>
</FONT></DIV>
<DIV><FONT face=3DArial><STRONG>ACCOUNTING =
REPERCUSSIONS</STRONG></FONT></DIV>
<DIV><FONT face=3DArial>Krispy Kreme, which had planned to shift some of =
its debt=20
using off balance sheet financing, has now announced it will use =
conventional=20
financing. Then there is Newmont Mining (NEM) which got hurt Monday =
after=20
Prudential downgraded it, saying "Several of the deposits that Newmont=20
classifies as reserves or resources appear suspect". Want to guess who =
their=20
auditor is?? </FONT></DIV>
<DIV><FONT face=3DArial></FONT>&nbsp;</DIV>
<DIV><FONT face=3DArial>I expect that eventually accounting firms will =
be banned=20
from doing consulting business with the same companies they audit. But =
meantime,=20
most are already changing their practice to follow this. And any company =
with=20
any kind of accounting problem is suffering the hot spotlight of the =
media.=20
Latest to surface include IBM, WCOM, NVDA,&nbsp;AFAM.</DIV>
<DIV>
<HR>
</DIV></FONT>
<DIV><FONT face=3DArial><STRONG>JAPAN</STRONG></FONT></DIV>
<DIV><FONT face=3DArial>Total of bad bank loan debt now being estimated =
at $1.1=20
trillion, and that's given their generous interpretation of what is a=20
non-performing loan. Govt debt from deficit spending is already 130% of =
GDP. And=20
still the Nikkei comes roaring back to break 10,000 again, all on hopes =
that the=20
govt is finally moving to bail out the banks. Just operational last =
Friday is=20
the Banks Shareholding Purchasing Corp (BSPC) funded with $15 billion to =
spend=20
to March 31, and another $15 billion for the next fiscal year. Money =
comes from=20
over 100 financial institutions, and will be used to buy stocks from the =
banks=20
rather than have the selling pressure&nbsp;hitting the markets. Sounds =
like a=20
shell game to me, moving losses from the banks to BSPC. And still =
unclear to me=20
is whether the sale to BSPC will be done at current market prices, or at =

original cost basis. I just don't see the benefit of a financial =
institution=20
funding BSPC to buy its own portfolio. But somehow the Japanese see this =
as a=20
good thing.</DIV>
<DIV>
<HR>
</DIV>
<DIV><STRONG>ECONOMICS</STRONG></DIV>
<DIV>Retails sales slipped a little (minus 0.2%) in January due expected =
weak=20
car sales (told you late last year they were cannibalizing future =
sales), but=20
the figure beat expectations for sales less cars, rising 1.2%. Both beat =

expectations of minus 0.3% and plus 0.4%. In addition, December figures =
were=20
revised upward from a negative 0.1% to plus 0.2% and plus 0.7%. The =
combo of=20
revising all data for December up and into positive territory, along =
with two=20
straight months of strong sales (except for autos) is a compelling =
trend. And=20
even the decline in auto sales is soft and expected, given all the zero =
interest=20
loan incentive plans late last year.</DIV>
<DIV>&nbsp;</DIV>
<DIV>New unemployment claims fell a little instead of rising a little as =

expected, further pointing to stabilization in the employment =
sector.</DIV>
<DIV>&nbsp;</DIV>
<DIV>Overall inventories were down in December 0.4%, just under =
expectations of=20
a 0.5% drop. But excluding autos (which rose 0.1%, another sign of just =
how=20
sales were cannibalized late last year) inventories were down 0.6%. This =
was the=20
11th straight month of inventory declines.</DIV>
<DIV>&nbsp;</DIV>
<DIV>Producer Price Index (PPI) beat expectations (overall up 0.1%, =
expected was=20
0.2 to 0.3%, and core was down 0.1% against expectations of a rise of =
0.1%)=20
continuing to signal no inflation, at least at the wholesale level. For =
all of=20
2001, the PPI dropped 2.6%, biggest drop for 12 months since Feb =
'49-'50.</DIV>
<DIV>
<HR>
</DIV>
<DIV><STRONG>"M"</STRONG></DIV>
<DIV>Don't know if everyone had a week like mine, but I felt pretty =
bloodied and=20
battered by the time Friday's trading was over. Not a good week for =
growth,=20
especially for the small and micro cap stocks. Despite that, for the =
week, the=20
DOW 30, S&amp;P500, and the Russell 2000 managed to close slightly =
higher for=20
the week. And NASDAQ finished less than a percent down. Gold began a =
slide back=20
below $300, no surprise to me who doesn't believe this was anything more =
than a=20
spike in a continuing bear market for the precious metals. </DIV>
<DIV>
<HR>
</DIV>
<DIV><STRONG>WORLEY'S WATCHLIST WANNABES</STRONG></DIV>
<DIV>As always, Bx means a chart where I see the stock in a flat line =
"B"ase of=20
"x" weeks duration. If I see a specific pattern such as a cup &amp; =
handle,=20
double bottom, LLUR, etc I will say so. And this review is with all my =
blinders=20
and personal biases removed, they are not stocks I might personally =
consider=20
buying. For the most part, I am only considering the prior 6-9 months of =
the=20
chart.</DIV>
<DIV>&nbsp;</DIV>
<DIV>Population of stocks I am reviewing this weekend appears to be =
stable to=20
slightly larger.</DIV>
<DIV>&nbsp;</DIV>
<DIV>AMWD - B2, but may be trying to reestablish its LLUR patter from =
last=20
year</DIV>
<DIV>ATK - c&amp;h, triple bottom, handle two weeks long with price =
spike on=20
volume Friday approaching pivot</DIV>
<DIV>BPRX - b/o from an 8 week consolidation appears to have =
failed</DIV>
<DIV>BRO - B2</DIV>
<DIV>CDWC - B3</DIV>
<DIV>CECO - B2</DIV>
<DIV>DHI - B3, another home builder</DIV>
<DIV>DHOM - B2, another home builder, in my fund</DIV>
<DIV>DKWD - rough LLUR</DIV>
<DIV>DLX - LLUR</DIV>
<DIV>EPIQ - 9 week consolidation base, owned and in fund</DIV>
<DIV>FCEA - B8</DIV>
<DIV>FCN - the beautiful LLUR pattern may be on its last legs</DIV>
<DIV>FLIR - possible c&amp;h</DIV>
<DIV>FMAR - B6</DIV>
<DIV>GFF - LLUR</DIV>
<DIV>GTK - B2</DIV>
<DIV>HOV - B7, another home builder</DIV>
<DIV>HRB - LLUR</DIV>
<DIV>MBFI - B6</DIV>
<DIV>MCL - low priced LLUR</DIV>
<DIV>NOBL - consolidation, great earnings growth, in my fund</DIV>
<DIV>OVRL - B3, I own and in my VR fund, EPS 49</DIV>
<DIV>RMCI - c&amp;h, owned and in fund</DIV>
<DIV>SHLR - B2, another home builder</DIV>
<DIV>SNS - B5</DIV>
<DIV>STJ - B3</DIV>
<DIV>SWTX - B6, low priced</DIV>
<DIV>SYPR - LLUR</DIV>
<DIV>URBN - ascending base??</DIV>
<DIV>WLS - hummm??, in my fund, another home builder</DIV>
<DIV>WSH - B2</DIV>
<DIV>&nbsp;</DIV>
<DIV>Happy Hunting,</DIV>
<DIV>&nbsp;</DIV>
<DIV><IMG alt=3D"" hspace=3D0 =
src=3D"cid:005301c1b744$660b4bc0$1ba08fd0@D73PS211"=20
align=3Dbaseline border=3D0></DIV>
<DIV>&nbsp;</DIV></FONT>
<DIV><FONT face=3DArial></FONT>&nbsp;</DIV>
<DIV><FONT face=3DArial>Tom Worley<BR><A=20
href=3D"mailto:stkguru@netside.net">stkguru@netside.net</A><BR>AIM:=20
TexWorley</FONT></DIV></BODY></HTML>

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