So Long Dow 10,000

The pre-market activity is signaling another down day for the markets. The Dow looks to fall below 10,000 (yet again).
The troubles are once again coming from Europe. The euro is below $1.22 and it’s close to the low it reached last week.
The market’s activity is similar to what happened in 2008. I’m not saying this is a repeat or it’s on the same scale, but we’re seeing the similar moves. For example, investors are filing out of gold, oil and stocks and into U.S. Treasuries.
In the Treasury market, the five-year yield is down to a puny 1.91%. That’s just absurd! Who really wants to lock-in 1.91% over the next five years? I guess someone does because that’s where it is but it’s less than 10% for the entire time. The ten-year yield is just 3.10%.
The good news today came from Medtronic (MDT), one of our trusty Buy List stocks. The company earned 89 cents per share which beat Wall Street’s estimate by a penny a share. Medtronic’s revenue jumped to $4.2 billion from $3.13 billion a year ago. This just barely topped Wall Street’s forecast of $4.19 billion.
This earnings report was for Medtronic’s fourth quarter. Their fiscal year ends on April 30. For the current fiscal year, the company forecasts earnings growth between 10% and 13%. Excluding charges, that means the company is looking for EPS between $3.54 and $3.64. At $40 a share, the stock is a bargain although it may be even more of a bargain later today.

Posted by on May 25th, 2010 at 9:20 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.