mrmarket
03-13-2006, 01:09 PM
How do I do it? How do I do it? There must be some kind of catch. Some kind of string up my sleeve. I must be reading someone else’s newsletter and claiming their stock picks as my own. How can someone who bench presses 385 lbs make 81 consecutive winning trades of 15% or better. This certainly defies reality. Nonsense! I am the one and only $$$MR. MARKET$$$.
Today I sold WIRE at 36.20. That’s a 15% gain over my purchase price of 31.42 on February 16. February 16? That’s only 25 days ago. A 15% gain in only 25 days? That’s a 222% annualized gain. Hmmm. Let’s see what the S&P 500 did over the last 25 days. Ooops….I did it again, the poor S&P 500 was down 0.4% over the same period. That means all of those high paid money managers who try to emulate the S&P 500 just got their butts kicked..once again.. by $$$MR. MARKET$$$.
I am HUGE! Bring me your finest meats and cheeses! I am Strongman, Ropeman, Tornadoman and Diaperman all rolled up into one. I eat Big Macs off of Captain America’s shield. I tied up Wonder Woman in her lasso and made her watch football with me. I farted in the Batcave, and Batman thinks Alfred did it. I can beat the Flash running backwards and I have bigger biceps than Robin (who doesn't...what a wuss).
The really good news is that another $$$MR. MARKET$$$ super pick is around the corner. But first you must tell me who the greatest stock picker on the planet. I want at least 50 responses, or you get no pick. I mean it.
Send this email to 3 of your friends who love the stock market.
I am HUGE!
$$$MR. MARKET$$$
http://www.mrmarketishuge.com
================================================== =============
02-16-2006, 03:15 PM
mrmarket
Administrator Join Date: Sep 2003
Posts: 1,782
WIRE ==> The Canada Flag Day Winner
--------------------------------------------------------------------------------
Copper was a fearless hound.
When confronted with a challenger, he would respond as only a dog could, he would bare his teeth and mark the house with his manly dog musk. This would not sit well with people he protected, so Copper was sent to have a glandectomy.
He wore the collar of shame for a month till his ass healed.
Now he fights injustice with his sidekick Cody.
…..but without the foul odor.
Copper…the joy it used to bring in my youth. Holding a few copper pennies in my hand, I could go to Charlies and get Maryjanes, Bullseyes, wax lips, licorice and Squirrel Nuts. Now with copper prices going up, I can get much more than penny candy.
Today I bought WIRE (Encore Wire) at 31.42. I will sell it in 4 to 6 weeks at 36.20. Here’s why I like WIRE:
WIRE’s stock is up 154% over the last 12 months yet its PE screams value at only 14.7. Surely if this stock keeps up its most recent earnings trend, it’s share price will scream up in a hurry. Look at this chart:
Looks like a stairway to the stars…but other than what the Blue Oyster Cult has to say, there has to be some fundamentals behind all of this.
The Group's principal activity is to manufacture copper electrical building wire and non-metallic cable. The Group supplies residential wire for interior electrical wiring in homes, apartments and manufactured housing. It also provides building wire for electrical distribution in commercial and industrial buildings. The residential wire product consists of non-metallic cable and underground feeder cable and commercial wire product consists of THHN cable. The products are sold through approximately 30 manufacturers representatives located throughout the United States and to a lesser extent through the Group's own direct in-house marketing efforts. The customers of the Group are wholesale electrical distributors and retail home improvement centers.
Oh…so you’re one of those people who think wireless is the way to go? Try running a wrestling match with 200 kids with a PA system using wireless technology in a gym packed with 300 people all using their cellphones at the same time. Wireless is for the birds. Give me good hard copper lines that I can see and touch anyday of the week.
The rest of the world seems to think so. Last week Encore Wire Corp. reported fourth-quarter net earnings of $35.4 million, or $1.50 a share, vs. $6.44 million, or 27 cents a share, in the year-ago period. Revenue surged 66% to $244.2 million from $147.5 million. ANAL-ysts polled by Thomson First Call had forecast earnings of 36 cents a share on revenue of $178.7 million. Boy they were right on the mark with that one.
For the year, earnings jumped to $50.1 million, or $2.13 per share, from $33.4 million, or $1.42 per share, in 2004. The increase was boosted by higher annual sales, which grew to $758.1 million from $603.2 million.
On a sequential quarter comparison, sales for the fourth quarter of 2005 increased 17.7% to $244.2 million from $207.5 million during the third quarter of 2005. Net Income for the fourth quarter of 2005 increased 216% to $35.4 million versus $11.2 million in the third quarter of 2005. Fully diluted net income per common share was $1.50 in the fourth quarter of 2005 versus $0.48 in the third quarter of 2005.
Encore Wire is a smart company, giving the people what they want. Encore Wire introduced its colored wire and cable for the commercial market in 1999 to help contractors with installation and inspection, simplify inventory management and provide a safer, more efficient work environment. With the cable for larger commercial jobs, each conductor comes in a different color.
Encore began manufacturing color-coded wire for the residential market in December 2001. The company now colors all of its 12/2G NM yellow and 10/2G NM orange, after numerous requests from electrical contractors and distributors. In explaining his selection of the colored wire as Product of the Year, a Pittsburgh, Pa.-based general contractor, said, “In residential wiring, there is no longer any question on, ‘Did I use the correct gauge?’ I think this is the clear winner.”
“It really created a buzz,” said Sharon Butler, Richards Electric Supply Co., Louisville, Ky. “The colored wire makes the job look professional and neat. If someone has not seen it on a job before, they need to. They will be using it on their next job.”
Encore's colored commercial building wire can help simplify complex wiring jobs. It saves time and money while providing a safer, more efficient work environment. They will cut, parallel and deliver colored reels to the job site or anywhere in the country in three to four days in most cases. They stock all sizes and colors at their McKinney, Texas distribution center and maintain an inventory level that ensures the quality of service Encore customers have come to expect.
Encore has a state of the art manufacturing facility that has cut down on the number of times the wire must be handled during manufacturing. Employees have performance incentives that have inspired greater productivity as well. The company is focused on rapid delivery and excellent customer service. Both manufacturing and marketing efficiencies have helped the company boost market share.
To compete and carve out a decent return for its shareholders, Encore mostly relies on its status as a low-cost producer and the savvy of its well-experienced management for a competitive advantage. It also does a good job keeping its wholesale electrical distributor customers coming back with a high level of customer service and a high order fill rate.
After doubling in the past 5 months, it would not be surprising to find that Encore Wire is a bit overvalued. However, in Encore's case its earnings have been keeping pace with the stock price and the multiples don't look all that bad. The current trailing PE is 14.7. Meanwhile, the industry PE ratio is 25. The price-to-sales ratio is only 0.9 and is below industry levels of 1.55.
The Company’s operating results in any given time period are driven by several key factors, including; the volume of product produced and shipped, the cost of copper and other raw materials, the competitive pricing environment in the wire industry and the resulting influence on gross margins and the efficiency with which the Company’s plant operates during the period, among others. Price competition for electrical wire and cable is intense, and the Company sells its products in accordance with prevailing market prices. Copper is the principal raw material used by the Company in manufacturing its products. Copper accounted for approximately 73.0%, 67.1% and 63.9% of the Company’s cost of goods sold during fiscal 2004, 2003 and 2002, respectively.
In February, Encore said it was encouraged by the strong increase in sales and margins during the second half of 2005, versus the first half of the year. The company added that margins were low throughout most of the first half of 2005, but began to trend upward late in the second quarter and continued to widen significantly through the third and fourth quarters. WIRE noted that pricing discipline in its industry continued to solidify in the fourth quarter. In July 2005, construction began at a new 150,000 square foot manufacturing plant at the McKinney facility to house production of the new armored cable product line. This extension of Encore’s product line was expected to begin producing sales in the third quarter of 2006.
The company sells its products to at least 60% of the 200 leading wholesale electrical distributors, according to data in the September 2002 issue of Electrical Wholesaling Magazine. No single customer accounted for over 10%.
Digging a little deeper, look at this performance. Revenue has grown each and every year since 2001. Its 5 year sales growth rate is 22% vs. industry average of 12%. Meanwhile, Encore Wire’s balance sheet is in great shape. Total Debt to Equity is only 33% vs. Industry Average of 68%. They have TTM interest coverage of 20, which means even if times get lean (which they won’t for now) they won’t have to take any drastic measures to keep the business running.
Performance metrics signal a company that is really clicking. For example, Return on Assets TTM for WIRE is 16.7% vs. Industry average of 9%. Return on Investment TTM is 19.5% vs 11.3% for the industry. Return on Equity TTM is 27% for WIRE while Industry average is 16.7%. This isn’t just a Britney Spears flash in the pan. No no no. These guys are the Rolling Stones.
Look at their 5 yr averages:
Return on Assets for WIRE is 10% vs. Industry average of 6%. Return on Investment is 12.2% vs 7.4% for the industry. Return on Equity TTM is 17.6% for WIRE while Industry average is 10.2%.
This is because they just operate more efficiently than their competition. Despite being able to fill almost every customer order, their working capital is used efficiently. Inventory Turnover TTM is 11.8 vs. Industry Average 7.2 and Asset Turnover is 2.5 vs. Industry Average 1.5.
So….despite what ANAL-ysts say, where are earnings REALLY going? ANAL-ysts have estimated 2006 revenues of 798 MM and earnings of $1.69/share. Come on. How pathetic is that? And they pay these guys $1,000,000 / yr to spew out such nonsense? With copper prices on the rise, demand on the rise, sales on the rise, WIRE had last quarter revenues of 244 MM. So how on earth could one possibly surmise that they will only sell 798 MM this year??? Come on guys, turn over the crack pipe please before you hurt yourselves.
$$$MR. MARKET$$$ will correctly predict that 2006 revenues will be $1,060 MM and will translate into earnings of $3.64/share. Even with the ridiculously low P/E of 14.7, these earnings will propel the stock price to a calculated value of $53.51/share, which is well past my sell price.
You gotta go with the mo, Joe. Does everyone forget that hundreds of thousands of Gulf Coast homes were destroyed last year. You know how much wire is needed to rebuild these homes? They aren’t going to use all that old wire you know.
BHP Billiton, the world's biggest mining company, expects no slowdown in the demand for metals and energy that contributed to a four-year rally in commodity prices, said Chief Executive Officer Charles ``Chip'' Goodyear.
Production of raw materials will be curbed by a shortage of miners and equipment needed to increase supply, as companies struggle to expand after restraining investments for as long as two decades, he said.
``Ultimately it's underlying demand that sets the product price,'' Goodyear said in an interview in London today. ``As you look around the world, the growth continues to look good.''
WIRE is able to pass on almost all of this cost increase to its customers. Even if the margin percent stays the same, higher prices mean higher gross margins which means higher earnings. This is all in the face of higher demand for wire overall. The stars are all lined up for a banner year.
Here’s what the boss has to say:
Commenting on the results, Daniel L. Jones, President and Chief Executive Officer of Encore Wire Corporation, said, "We are proud to announce new records for quarterly and annual earnings and sales. We are enthused by the strong increase in sales and margins during the second half of 2005 versus the first half of 2005. Margins were low throughout most of the first half of 2005. They began to trend upward late in the second quarter of 2005 and continued to expand significantly through the third and fourth quarters. Pricing discipline in our industry continued to solidify in the fourth quarter, enhancing our margins. The price of copper, our major raw material, continues to be strong, which has historically enhanced our margins. Although other inputs such as PVC resin and energy rose in cost as the Gulf Coast hurricanes impacted supplies of these components, we were successful in passing on these cost increases through the price of our wire, while experiencing minimal interruption in our supply. The construction of our new armored cable plant continues on schedule. This extension of our product line is expected to begin producing sales in the third quarter of 2006. Due to our strong cash flow in the fourth quarter, we were able to pay down our debt $13.1 million to $71.2 million despite the fact we increased our working capital by $19.1 million and spent $7.1 million on capital expenditures. We will continue to manage the Company to grow sales and earnings while maintaining our historically strong and conservative balance sheet. We also want to thank our employees and associates for their tremendous efforts and our stockholders for their support."
Well here is one stockholder who will support you for another 15% rise in your stock price. Then I’ll sell this stock so fast and bury my money that not even Copper and Cody will be able to find it.
If you liked this write up please let me know….and forward it on to 3 of your friends.
I am HUGE!
$$$MR. MARKET$$$
http://www.mrmarketishuge.com
Today I sold WIRE at 36.20. That’s a 15% gain over my purchase price of 31.42 on February 16. February 16? That’s only 25 days ago. A 15% gain in only 25 days? That’s a 222% annualized gain. Hmmm. Let’s see what the S&P 500 did over the last 25 days. Ooops….I did it again, the poor S&P 500 was down 0.4% over the same period. That means all of those high paid money managers who try to emulate the S&P 500 just got their butts kicked..once again.. by $$$MR. MARKET$$$.
I am HUGE! Bring me your finest meats and cheeses! I am Strongman, Ropeman, Tornadoman and Diaperman all rolled up into one. I eat Big Macs off of Captain America’s shield. I tied up Wonder Woman in her lasso and made her watch football with me. I farted in the Batcave, and Batman thinks Alfred did it. I can beat the Flash running backwards and I have bigger biceps than Robin (who doesn't...what a wuss).
The really good news is that another $$$MR. MARKET$$$ super pick is around the corner. But first you must tell me who the greatest stock picker on the planet. I want at least 50 responses, or you get no pick. I mean it.
Send this email to 3 of your friends who love the stock market.
I am HUGE!
$$$MR. MARKET$$$
http://www.mrmarketishuge.com
================================================== =============
02-16-2006, 03:15 PM
mrmarket
Administrator Join Date: Sep 2003
Posts: 1,782
WIRE ==> The Canada Flag Day Winner
--------------------------------------------------------------------------------
Copper was a fearless hound.
When confronted with a challenger, he would respond as only a dog could, he would bare his teeth and mark the house with his manly dog musk. This would not sit well with people he protected, so Copper was sent to have a glandectomy.
He wore the collar of shame for a month till his ass healed.
Now he fights injustice with his sidekick Cody.
…..but without the foul odor.
Copper…the joy it used to bring in my youth. Holding a few copper pennies in my hand, I could go to Charlies and get Maryjanes, Bullseyes, wax lips, licorice and Squirrel Nuts. Now with copper prices going up, I can get much more than penny candy.
Today I bought WIRE (Encore Wire) at 31.42. I will sell it in 4 to 6 weeks at 36.20. Here’s why I like WIRE:
WIRE’s stock is up 154% over the last 12 months yet its PE screams value at only 14.7. Surely if this stock keeps up its most recent earnings trend, it’s share price will scream up in a hurry. Look at this chart:
Looks like a stairway to the stars…but other than what the Blue Oyster Cult has to say, there has to be some fundamentals behind all of this.
The Group's principal activity is to manufacture copper electrical building wire and non-metallic cable. The Group supplies residential wire for interior electrical wiring in homes, apartments and manufactured housing. It also provides building wire for electrical distribution in commercial and industrial buildings. The residential wire product consists of non-metallic cable and underground feeder cable and commercial wire product consists of THHN cable. The products are sold through approximately 30 manufacturers representatives located throughout the United States and to a lesser extent through the Group's own direct in-house marketing efforts. The customers of the Group are wholesale electrical distributors and retail home improvement centers.
Oh…so you’re one of those people who think wireless is the way to go? Try running a wrestling match with 200 kids with a PA system using wireless technology in a gym packed with 300 people all using their cellphones at the same time. Wireless is for the birds. Give me good hard copper lines that I can see and touch anyday of the week.
The rest of the world seems to think so. Last week Encore Wire Corp. reported fourth-quarter net earnings of $35.4 million, or $1.50 a share, vs. $6.44 million, or 27 cents a share, in the year-ago period. Revenue surged 66% to $244.2 million from $147.5 million. ANAL-ysts polled by Thomson First Call had forecast earnings of 36 cents a share on revenue of $178.7 million. Boy they were right on the mark with that one.
For the year, earnings jumped to $50.1 million, or $2.13 per share, from $33.4 million, or $1.42 per share, in 2004. The increase was boosted by higher annual sales, which grew to $758.1 million from $603.2 million.
On a sequential quarter comparison, sales for the fourth quarter of 2005 increased 17.7% to $244.2 million from $207.5 million during the third quarter of 2005. Net Income for the fourth quarter of 2005 increased 216% to $35.4 million versus $11.2 million in the third quarter of 2005. Fully diluted net income per common share was $1.50 in the fourth quarter of 2005 versus $0.48 in the third quarter of 2005.
Encore Wire is a smart company, giving the people what they want. Encore Wire introduced its colored wire and cable for the commercial market in 1999 to help contractors with installation and inspection, simplify inventory management and provide a safer, more efficient work environment. With the cable for larger commercial jobs, each conductor comes in a different color.
Encore began manufacturing color-coded wire for the residential market in December 2001. The company now colors all of its 12/2G NM yellow and 10/2G NM orange, after numerous requests from electrical contractors and distributors. In explaining his selection of the colored wire as Product of the Year, a Pittsburgh, Pa.-based general contractor, said, “In residential wiring, there is no longer any question on, ‘Did I use the correct gauge?’ I think this is the clear winner.”
“It really created a buzz,” said Sharon Butler, Richards Electric Supply Co., Louisville, Ky. “The colored wire makes the job look professional and neat. If someone has not seen it on a job before, they need to. They will be using it on their next job.”
Encore's colored commercial building wire can help simplify complex wiring jobs. It saves time and money while providing a safer, more efficient work environment. They will cut, parallel and deliver colored reels to the job site or anywhere in the country in three to four days in most cases. They stock all sizes and colors at their McKinney, Texas distribution center and maintain an inventory level that ensures the quality of service Encore customers have come to expect.
Encore has a state of the art manufacturing facility that has cut down on the number of times the wire must be handled during manufacturing. Employees have performance incentives that have inspired greater productivity as well. The company is focused on rapid delivery and excellent customer service. Both manufacturing and marketing efficiencies have helped the company boost market share.
To compete and carve out a decent return for its shareholders, Encore mostly relies on its status as a low-cost producer and the savvy of its well-experienced management for a competitive advantage. It also does a good job keeping its wholesale electrical distributor customers coming back with a high level of customer service and a high order fill rate.
After doubling in the past 5 months, it would not be surprising to find that Encore Wire is a bit overvalued. However, in Encore's case its earnings have been keeping pace with the stock price and the multiples don't look all that bad. The current trailing PE is 14.7. Meanwhile, the industry PE ratio is 25. The price-to-sales ratio is only 0.9 and is below industry levels of 1.55.
The Company’s operating results in any given time period are driven by several key factors, including; the volume of product produced and shipped, the cost of copper and other raw materials, the competitive pricing environment in the wire industry and the resulting influence on gross margins and the efficiency with which the Company’s plant operates during the period, among others. Price competition for electrical wire and cable is intense, and the Company sells its products in accordance with prevailing market prices. Copper is the principal raw material used by the Company in manufacturing its products. Copper accounted for approximately 73.0%, 67.1% and 63.9% of the Company’s cost of goods sold during fiscal 2004, 2003 and 2002, respectively.
In February, Encore said it was encouraged by the strong increase in sales and margins during the second half of 2005, versus the first half of the year. The company added that margins were low throughout most of the first half of 2005, but began to trend upward late in the second quarter and continued to widen significantly through the third and fourth quarters. WIRE noted that pricing discipline in its industry continued to solidify in the fourth quarter. In July 2005, construction began at a new 150,000 square foot manufacturing plant at the McKinney facility to house production of the new armored cable product line. This extension of Encore’s product line was expected to begin producing sales in the third quarter of 2006.
The company sells its products to at least 60% of the 200 leading wholesale electrical distributors, according to data in the September 2002 issue of Electrical Wholesaling Magazine. No single customer accounted for over 10%.
Digging a little deeper, look at this performance. Revenue has grown each and every year since 2001. Its 5 year sales growth rate is 22% vs. industry average of 12%. Meanwhile, Encore Wire’s balance sheet is in great shape. Total Debt to Equity is only 33% vs. Industry Average of 68%. They have TTM interest coverage of 20, which means even if times get lean (which they won’t for now) they won’t have to take any drastic measures to keep the business running.
Performance metrics signal a company that is really clicking. For example, Return on Assets TTM for WIRE is 16.7% vs. Industry average of 9%. Return on Investment TTM is 19.5% vs 11.3% for the industry. Return on Equity TTM is 27% for WIRE while Industry average is 16.7%. This isn’t just a Britney Spears flash in the pan. No no no. These guys are the Rolling Stones.
Look at their 5 yr averages:
Return on Assets for WIRE is 10% vs. Industry average of 6%. Return on Investment is 12.2% vs 7.4% for the industry. Return on Equity TTM is 17.6% for WIRE while Industry average is 10.2%.
This is because they just operate more efficiently than their competition. Despite being able to fill almost every customer order, their working capital is used efficiently. Inventory Turnover TTM is 11.8 vs. Industry Average 7.2 and Asset Turnover is 2.5 vs. Industry Average 1.5.
So….despite what ANAL-ysts say, where are earnings REALLY going? ANAL-ysts have estimated 2006 revenues of 798 MM and earnings of $1.69/share. Come on. How pathetic is that? And they pay these guys $1,000,000 / yr to spew out such nonsense? With copper prices on the rise, demand on the rise, sales on the rise, WIRE had last quarter revenues of 244 MM. So how on earth could one possibly surmise that they will only sell 798 MM this year??? Come on guys, turn over the crack pipe please before you hurt yourselves.
$$$MR. MARKET$$$ will correctly predict that 2006 revenues will be $1,060 MM and will translate into earnings of $3.64/share. Even with the ridiculously low P/E of 14.7, these earnings will propel the stock price to a calculated value of $53.51/share, which is well past my sell price.
You gotta go with the mo, Joe. Does everyone forget that hundreds of thousands of Gulf Coast homes were destroyed last year. You know how much wire is needed to rebuild these homes? They aren’t going to use all that old wire you know.
BHP Billiton, the world's biggest mining company, expects no slowdown in the demand for metals and energy that contributed to a four-year rally in commodity prices, said Chief Executive Officer Charles ``Chip'' Goodyear.
Production of raw materials will be curbed by a shortage of miners and equipment needed to increase supply, as companies struggle to expand after restraining investments for as long as two decades, he said.
``Ultimately it's underlying demand that sets the product price,'' Goodyear said in an interview in London today. ``As you look around the world, the growth continues to look good.''
WIRE is able to pass on almost all of this cost increase to its customers. Even if the margin percent stays the same, higher prices mean higher gross margins which means higher earnings. This is all in the face of higher demand for wire overall. The stars are all lined up for a banner year.
Here’s what the boss has to say:
Commenting on the results, Daniel L. Jones, President and Chief Executive Officer of Encore Wire Corporation, said, "We are proud to announce new records for quarterly and annual earnings and sales. We are enthused by the strong increase in sales and margins during the second half of 2005 versus the first half of 2005. Margins were low throughout most of the first half of 2005. They began to trend upward late in the second quarter of 2005 and continued to expand significantly through the third and fourth quarters. Pricing discipline in our industry continued to solidify in the fourth quarter, enhancing our margins. The price of copper, our major raw material, continues to be strong, which has historically enhanced our margins. Although other inputs such as PVC resin and energy rose in cost as the Gulf Coast hurricanes impacted supplies of these components, we were successful in passing on these cost increases through the price of our wire, while experiencing minimal interruption in our supply. The construction of our new armored cable plant continues on schedule. This extension of our product line is expected to begin producing sales in the third quarter of 2006. Due to our strong cash flow in the fourth quarter, we were able to pay down our debt $13.1 million to $71.2 million despite the fact we increased our working capital by $19.1 million and spent $7.1 million on capital expenditures. We will continue to manage the Company to grow sales and earnings while maintaining our historically strong and conservative balance sheet. We also want to thank our employees and associates for their tremendous efforts and our stockholders for their support."
Well here is one stockholder who will support you for another 15% rise in your stock price. Then I’ll sell this stock so fast and bury my money that not even Copper and Cody will be able to find it.
If you liked this write up please let me know….and forward it on to 3 of your friends.
I am HUGE!
$$$MR. MARKET$$$
http://www.mrmarketishuge.com