Go to Jeff Salisbury LWGate Home Page.From: "Tom Worley" <stkguru@bellsouth.net>
Subject: [CANSLIM] Worley's Weekend Weeview
Date: Sat, 29 Jun 2002 18:28:03 -0400
Previous Article (by Date): RE: [CANSLIM] WCOM restatement "Duke Miller"
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This is a multi-part message in MIME format. - ------=_NextPart_000_0309_01C21F9A.B4CFB110 Content-Type: multipart/alternative; boundary="----=_NextPart_001_030A_01C21F9A.B4CFB110" - ------=_NextPart_001_030A_01C21F9A.B4CFB110 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable EARNINGS Confession season is essentially over, without significant or major = warnings. In another week we will start seeing actual results. First = Call is expecting a meager 0.2% improvement in Q2 earnings for the = S&P500 stocks, still better than the negative numbers seen for many = quarters now. And for Q3 First Call expects earnings growth of 17.6% and = 29.1% in the Fourth Quarter. Of course, that is assuming we can accept = and trust the accounting practices being used. - -------------------------------------------------------------------------= - ------- ECONOMICS Durable goods orders rose 0.6% in May, slightly better than expectations = of a 0.5% gain, and improving on April's 0.4% gain. This was the fifth = increase in six months, but was widely different by industry. New home sales jumped 8.1% in May, hitting a record high (1.03 million = annual units), and existing home sales close to a record high. The FOMC (Federal Open Market Committee) left interest rates unchanged, = and indicated the risk to the economy is equally matched between = economic weakness and inflation, thus leaving the bias at neutral. Growth in 1st quarter GDP was revised up from 5.6% annualized to 6.1%, = beating expectations for it to remain unchanged, and putting it even = further ahead of the 1.7% growth in the 4th quarter. Personal spending slipped 0.1% in May (expected to have been flat), = while personal income rose as expected 0.3%. - -------------------------------------------------------------------------= - ------- "M" Reasons to worry (not in order of priority or importance): Mid-East crises (Israel-Palestine) India-Pakistan nuclear war (likelihood diminishing) Lack of growth in earnings (but not declining) Accounting Practices (hard to overlook with CEOs quitting/being = fired/being arrested More terrorism attacks Wirehouse analysts hyping stocks while trashing them in internal memos Weak dollar / further loss of foreign investment money in US stocks Business spending still not picking up Unemployment still high Money flow to equity mutual funds negative Japanese exports being hurt by strong yen (vs. US $) Financial collapse of Japanese banks (less likely now that US economy is = dragging Japanese economy higher) Weak support for the Japanese Prime Minister continuing the pain = avoidance, inaction to clean up their economy Any major company that used Andersen as an auditor in the past several = years NASDAQ has undercut the September lows Reasons to keep watching, and be ready (not in order of priority or = importance): Lots of reasons to worry Corporate earnings likely to show strong growth by end of Q3 Lots of money on the sidelines Sentiment turning more bearish finally September lows being tested on indexes (or exceeded) Consumers still spending Unemployment improving, layoffs diminishing Inventories at record lows, and must be replenished Feds won't be raising rates until late in the year, or later Xerox only overstated revenues by $2 billion, not the $3 billion = estimated by SEC, or $6 billion reported by WSJ Housing markets strong NASDAQ has undercut the September lows Economy improving at a non-inflationary rate - -------------------------------------------------------------------------= - ------- WORLEY'S WATCHLIST WANNABES This list is in no way intended to recommend any stocks to the group. It = is a part of my regular assessment of the health of CANSLIM's "M" and, = as the name implies, only intended to identify some stocks with = constructive chart patterns that may be worth WATCHING (and of course = doing your own due diligence). I am employed in Operations by a US = Broker Dealer, however everything presented by me is strictly my own = ideas and in no way should be taken to reflect the views or opinions of = my employer. I typically list stocks with both RS and EPS ranking of 80 or better, = and try to exclude stocks undergoing any merger / acquisition / buyout = scenario. I also exclude those stocks I spot with earnings forecast for = this year and next that are not at least close to 20%. I do no other due = diligence, that is your responsibility. I will note any CANSLIM patterns = I see, such as c&h, double (or triple) bottoms, or flat bases (shown as = Bx where "x" is the # of weeks, IMO). I will also note LLUR (Lower Left = Upper Right) even though it is not exactly a CANSLIM pattern. The population of stocks I am reviewing this weekend reversed its = decline during the past week and grew measurably. Daily lists were not = even a page long at the start of the week, and nearly three pages by = Friday. The across the board slide in all indexes, including small cap = growth, has hurt a lot of otherwise good looking charts. Next week may = show whether we once again get a FTD, and attempt to reverse this long = slide in a bear market. ACMR - nice cup formed AMZ - LLUR APOL - completed the cup, watch for a handle to form, but if market = takes off may skip the handle, b/o failure then more likely APSG - c&h CECO - beginning of a LLUR? DLTR - 9 week consolidation EPIQ - RS only 55, good recovery on volume over the 50 and to the 200 = dma, at pivot, owned and VR Fund FNLY - B7 FSTW - confused chart, good growth, microcap, in my VR Fund HLYW - saucer HRH - B2 MMSI - nice b/o from the handle on Thursday on volume, held the b/o on = volume Friday MOVI - B3 MTH - double bottom, forecast under 20% but right industry OVRL - double bottom, base on base, don't care just making me money = (real and VR), at the pivot SYPR - possible handle forming on short cup, in my VR Fund WSH - B5, slight trend up Happy Hunting, Tom Worley stkguru@bellsouth.net AIM: TexWorley - ------=_NextPart_001_030A_01C21F9A.B4CFB110 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable <!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> <HTML><HEAD> <META http-equiv=3DContent-Type content=3D"text/html; = charset=3Diso-8859-1"> <META content=3D"MSHTML 6.00.2716.2200" name=3DGENERATOR> <STYLE></STYLE> </HEAD> <BODY bgColor=3D#ffffff> <DIV><FONT face=3DArial><STRONG>EARNINGS</STRONG></FONT></DIV> <DIV><FONT face=3DArial>Confession season is essentially over, without = significant=20 or major warnings. In another week we will start seeing actual results. = First=20 Call is expecting a meager 0.2% improvement in Q2 earnings for the = S&P500=20 stocks, still better than the negative numbers seen for many quarters = now. And=20 for Q3 First Call expects earnings growth of 17.6% and 29.1% in the = Fourth=20 Quarter. Of course, that is assuming we can accept and trust the = accounting=20 practices being used.</DIV> <DIV> <HR> </DIV></FONT> <DIV><FONT face=3DArial></FONT><FONT=20 face=3DArial><STRONG>ECONOMICS</STRONG></FONT></DIV> <DIV><FONT face=3DArial>Durable goods orders rose 0.6% in May, slightly = better=20 than expectations of a 0.5% gain, and improving on April's 0.4% gain. = This was=20 the fifth increase in six months, but was widely different by=20 industry.</FONT></DIV> <DIV><FONT face=3DArial></FONT> </DIV> <DIV><FONT face=3DArial>New home sales jumped 8.1% in May, hitting a = record high=20 (1.03 million annual units), and existing home sales close to a record=20 high.</FONT></DIV> <DIV><FONT face=3DArial></FONT> </DIV> <DIV><FONT face=3DArial>The FOMC (Federal Open Market Committee) left = interest=20 rates unchanged, and indicated the risk to the economy is equally = matched=20 between economic weakness and inflation, thus leaving the bias at=20 neutral.</FONT></DIV> <DIV><FONT face=3DArial></FONT> </DIV> <DIV><FONT face=3DArial>Growth in 1st quarter GDP was revised up from = 5.6%=20 annualized to 6.1%, beating expectations for it to remain unchanged, and = putting=20 it even further ahead of the 1.7% growth in the 4th = quarter.</FONT></DIV> <DIV><FONT face=3DArial></FONT> </DIV> <DIV><FONT face=3DArial>Personal spending slipped 0.1% in May (expected = to have=20 been flat), while personal income rose as expected = 0.3%.</FONT></DIV><FONT=20 face=3DArial> <DIV> <HR> </DIV> <DIV><STRONG>"M"</STRONG></DIV> <DIV><EM>Reasons to worry (not in order of priority or = importance):</EM></DIV> <DIV>Mid-East crises (Israel-Palestine)</DIV> <DIV>India-Pakistan nuclear war (likelihood diminishing)</DIV> <DIV>Lack of growth in earnings (but not declining)</DIV> <DIV>Accounting Practices (hard to overlook with CEOs quitting/being = fired/being=20 arrested</DIV> <DIV>More terrorism attacks</DIV> <DIV>Wirehouse analysts hyping stocks while trashing them in internal=20 memos</DIV> <DIV>Weak dollar / further loss of foreign investment money in US = stocks</DIV> <DIV>Business spending still not picking up</DIV> <DIV>Unemployment still high</DIV> <DIV>Money flow to equity mutual funds negative</DIV> <DIV>Japanese exports being hurt by strong yen (vs. US $)</DIV> <DIV>Financial collapse of Japanese banks (less likely now that US = economy is=20 dragging Japanese economy higher)</DIV> <DIV>Weak support for the Japanese Prime Minister continuing the pain = avoidance,=20 inaction to clean up their economy</DIV> <DIV>Any major company that used Andersen as an auditor in the past = several=20 years</DIV> <DIV>NASDAQ has undercut the September lows</DIV> <DIV> </DIV> <DIV><EM>Reasons to keep watching, and be ready (not in order of = priority or=20 importance):</EM></DIV> <DIV>Lots of reasons to worry</DIV> <DIV>Corporate earnings likely to show strong growth by end of Q3</DIV> <DIV>Lots of money on the sidelines</DIV> <DIV>Sentiment turning more bearish finally</DIV> <DIV>September lows being tested on indexes (or exceeded)</DIV> <DIV>Consumers still spending</DIV> <DIV>Unemployment improving, layoffs diminishing</DIV> <DIV>Inventories at record lows, and must be replenished</DIV> <DIV>Feds won't be raising rates until late in the year, or later</DIV> <DIV>Xerox only overstated revenues by $2 billion, not the $3 billion = estimated=20 by SEC, or $6 billion reported by WSJ</DIV> <DIV>Housing markets strong</DIV> <DIV>NASDAQ has undercut the September lows</DIV> <DIV>Economy improving at a non-inflationary rate</DIV></FONT> <DIV><FONT face=3DArial> <HR> </FONT></DIV> <DIV><FONT face=3DArial> <DIV><FONT face=3DArial><STRONG>WORLEY'S WATCHLIST = WANNABES</STRONG></FONT></DIV> <DIV><FONT face=3DArial>This list is in no way intended to recommend any = stocks to=20 the group. It is a part of my regular assessment of the health of = CANSLIM's "M"=20 and, as the name implies, only intended to identify some stocks with=20 constructive chart patterns that may be worth WATCHING (and of course = doing your=20 own due diligence). I am employed in Operations by a US Broker Dealer, = however=20 everything presented by me is strictly my own ideas and in no way should = be=20 taken to reflect the views or opinions of my employer.</FONT></DIV> <DIV><FONT face=3DArial></FONT> </DIV> <DIV><FONT face=3DArial>I typically list stocks with both RS and EPS = ranking of 80=20 or better, and try to exclude stocks undergoing any merger / acquisition = /=20 buyout scenario. I also exclude those stocks I spot with earnings = forecast for=20 this year and next that are not at least close to 20%. I do no other due = diligence, that is your responsibility. I will note any CANSLIM patterns = I see,=20 such as c&h, double (or triple) bottoms, or flat bases (shown as Bx = where=20 "x" is the # of weeks, IMO). I will also note LLUR (Lower Left Upper = Right) even=20 though it is not exactly a CANSLIM pattern.</FONT></DIV> <DIV><FONT face=3DArial></FONT> </DIV> <DIV><FONT face=3DArial>The population of stocks I am reviewing this = weekend=20 reversed its decline during the past week and grew measurably. Daily = lists were=20 not even a page long at the start of the week, and nearly three pages by = Friday.=20 The across the board slide in all indexes, including small cap growth, = has hurt=20 a lot of otherwise good looking charts. Next week may show whether we = once again=20 get a FTD, and attempt to reverse this long slide in a bear = market.</FONT></DIV> <DIV> </DIV> <DIV>ACMR - nice cup formed</DIV> <DIV>AMZ - LLUR</DIV> <DIV>APOL - completed the cup, watch for a handle to form, but if market = takes=20 off may skip the handle, b/o failure then more likely</DIV> <DIV>APSG - c&h</DIV> <DIV>CECO - beginning of a LLUR?</DIV> <DIV>DLTR - 9 week consolidation</DIV> <DIV>EPIQ - RS only 55, good recovery on volume over the 50 and to the = 200 dma,=20 at pivot, owned and VR Fund</DIV> <DIV>FNLY - B7</DIV> <DIV>FSTW - confused chart, good growth, microcap, in my VR Fund</DIV> <DIV>HLYW - saucer</DIV> <DIV>HRH - B2</DIV> <DIV>MMSI - nice b/o from the handle on Thursday on volume, held the b/o = on=20 volume Friday</DIV> <DIV>MOVI - B3</DIV> <DIV>MTH - double bottom, forecast under 20% but right industry</DIV> <DIV>OVRL - double bottom, base on base, don't care just making me money = (real=20 and VR), at the pivot</DIV> <DIV>SYPR - possible handle forming on short cup, in my VR Fund</DIV> <DIV>WSH - B5, slight trend up</DIV> <DIV> </DIV> <DIV>Happy Hunting,</DIV></FONT></DIV> <DIV><FONT face=3DArial></FONT> </DIV> <DIV><FONT face=3DArial><IMG alt=3D"" hspace=3D0=20 src=3D"cid:030801c21fbc$3bd7db30$6501a8c0@TOMSBOX" align=3Dbaseline=20 border=3D0></FONT></DIV> <DIV><FONT face=3DArial>Tom Worley<BR></FONT><A=20 href=3D"mailto:stkguru@bellsouth.net"><FONT=20 face=3DArial>stkguru@bellsouth.net</FONT></A><BR><FONT face=3DArial>AIM: = TexWorley</FONT></DIV></BODY></HTML> - ------=_NextPart_001_030A_01C21F9A.B4CFB110-- - ------=_NextPart_000_0309_01C21F9A.B4CFB110 Content-Type: image/gif; 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