I’m Back!

I’m back—tanned, rested and ready. Actually, I’m slightly burnt, but that aside, Florida was wonderful.
Here are a few items this morning. In case you missed this, the Wall Street Journal had a great story on “Joe Herrick of Gutterman Research.” That’s the nom de conference call of some hoaxer who manages to slip into real corporate conference calls. When it’s Joe’s turn to ask a question, he lays out some hyper-wonky question to senior management. Stammering and jargon ensues.
Some CEOs are on to Joe and they find him highly annoying. Joseph Weisenthal calls him his “personal hero.” I agree, it’s pretty amusing. Most conference calls are dull, and they’re more about showcasing the analysts instead of the company.
Medtronic (MDT) reported earnings this morning of 63 cents a share, two cents better than what the Street was expecting. These results exclude very large charges dealing with legal issues and acquisitions. The company earned 61 cents a share last year.
Here’s a look at Medtronic’s sales and earnings for the past few quarters:
Quarter………..EPS………….Sales
Jul-01…………$0.28………..$1,455.70
Oct-01………..$0.29………..$1,571.00
Jan-02………..$0.30………..$1,592.00
Apr-02………..$0.34………..$1,792.00
Jul-02…………$0.32………..$1,713.90
Oct-02………..$0.34………..$1,891.00
Jan-03………..$0.35………..$1,912.50
Apr-03………..$0.40………..$2,148.00
Jul-03…………$0.37………..$2,064.20
Oct-03………..$0.39………..$2,163.80
Jan-04………..$0.40………..$2,193.80
Apr-04………..$0.48………..$2,665.40
Jul-04…………$0.43………..$2,346.10
Oct-04………..$0.44………..$2,399.80
Jan-05………..$0.46………..$2,530.70
Apr-05………..$0.53………..$2,778.00
Jul-05…………$0.50………..$2,690.40
Oct-05………..$0.54………..$2,765.40
Jan-06………..$0.55………..$2,769.50
Apr-06………..$0.62………..$3,066.70
Jul-06…………$0.55………..$2,897.00
Oct-06………..$0.59………..$3,075.00
Jan-07………..$0.61………..$3,048.00
Apr-07………..$0.66………..$3,280.00
Jul-07…………$0.62………..$3.127.00
Oct-07………..$0.58………..$3,124.00
Jan-08………..$0.61………..$3,405.00
The company also said that it wouldn’t be surprised to see Wall Street’s full-year estimate rise from $2.52 a share to $2.54 a share.
On Sunday, The New York Times profiled David Swenson, the very successful manager of Yale’s endowment. His advice to investors is, “Don’t try anything fancy. Stick to a simple diversified portfolio, keep your costs down and rebalance periodically to keep your asset allocations in line with your long-term goals.”
I agree with him and that’s pretty much the philosophy of this website. Although I disagree with his view that superior performance is impossible for individual investors. I don’t believe for a second that the little guy is “shut out.”
In fact, I think the smaller investor has many advantages over professional investors. No individual investor has to struggle to “make” a quarter or beat a benchmark. Plus, individuals are probably less willing to follow the Wall Street crowd.
The rules for beating the market are the same for everyone, buy and hold good companies going for a good price.

Posted by on February 19th, 2008 at 9:06 am


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.