A New High and Other Notes

On Friday, the S&P 500 closed at a new all-time high. The index finished the day at 2,117.69. That tops the previous high of 2,117.39 from March 2. We went nearly two months without making a new high. That’s the longest “new high” drought since June 2013.

Since the bull market began in March 2009, the S&P 500 has gained 212.98%. Add in dividends and the index is up 256.17%.

That actually understates the rally by a little bit since small-caps have done so well. If we look at the Wilshire 5000, which is much broader than the S&P 500, stocks are up 266.96% including dividends. That’s enough to turn $27, 251 into $100,000.

A few other things. Moog (MOG-A) finally announced that they’ll release their earnings next Friday, May 1.

Nick Pinchuk, the CEO of Snap-on (SNA) appeared on Jim Cramer’s show Mad Money.

The tool manufacturer reported its eighth consecutive earnings beat before the market open Thursday.

Pinchuk explained that the company has succeeded simply by producing tools that make mechanics’ jobs easier. To do this, Snap-on consistently observes mechanics in action to identify and fix their frustrations.

“One of the big tailwinds behind Snap-on is the changing technology in the marketplace. We go into those workplaces and see what will make work easier for mechanics, technicians and professionals and we translate that back to our product development people, and it brings out new products,” Pinchuk said.

He added one of the biggest growth areas for Snap-on has been in diagnostics, and also noted the company’s 3,000 vans, its moving retail spaces, have helped drive success.

Cramer called Snap-on a great American company and said he thinks the stock has more room to go higher.

Snap-on beat earnings last week by five cents per share.

On Friday, Ford (F) announced a recall of 390,000 doors that fly open. Ford reports earnings on Tuesday.

This weekend’s Barron’s contains this nugget:

As an alternative, Merrill Lynch strategist Savita Subramanian recommends looking for “high quality” companies rather than judging a stock by the size of its price swings. Characteristics that equate to quality include stability of earnings, balance-sheet strength, and sustainability of dividends. Those traits are hard to come by among utilities and telecoms but are prevalent in sectors that are decidedly not low-beta, including industrials and tech. Among the cheap, high-quality, high-beta stocks in the Standard & Poor’s High Quality Index are insurer Aflac (AFL), which trades at a price/earnings ratio of 10; engine maker Cummins (CMI), at 12.2 times; and software provider Oracle (ORCL), at 14.4 times.

You’ve probably heard me go on and on about high-quality stocks. Two of the three listed, AFLAC (AFL) and Oracle (ORCL), are members in good standing on our Buy List.

Posted by on April 26th, 2015 at 5:44 pm


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.