mrmarket
12-02-2008, 10:52 PM
It’s time for me to find another hidden gem. Where should I look? I need something to help me find my way. How about my trusty Garmin GPS? I love this thing. It takes me everywhere. I never get lost. It works great. I don’t like driving anymore without it. Everyone should have at least one.
Wow…that hit my over the head like a sledge hammer. Let’s have a look shall we? In doing another value dig, I searched for a stock that had:
• Dropped more than 70% in price over the last 52 weeks.
• Had a trailing 12 month PE of less than 5. Yes less than 5. Why buy something expensive in this market? I’d rather buy something that CAN’T go much lower.
• I want Year on Year earnings growth greater than 60%
• To show consistency, I want a 3 year EPS growth of 60%
• I want annual revenue growth of 40%
• I want return on assets in excess of 20%
• I want return on equity in excess of 30%
• One more thing…I don’t want any debt on the books…zero..nada…nilch.
Only one stock fit the bill…Garmin. GRMN
Today I bought Garmin at 15.74. I will sell it in 4 – 6 weeks at 18.26. Here’s why I like Garmin:
I am sure everyone knows the Garmin story. It’s a great product. It’s 3 biggest competitors are private companies. Garmin’s market cap of 3.3 billion is bigger than all 3 of its competitors put together (Tom Tom, Magellan and some other crap company). The reason I point this out is if the recession is prolonged, then these little guys are going to be the ones who bite the bullet first….not Garmin.
Yeah Yeah…who’s going to buy a fancy GPS in a recession (even though it makes a great Christmas gift)? I’m not going to argue that point, but the world is going to last a lot longer than this recession and men are going to continue to get lost driving and they will continue to not want to ask for directions well after this recession is long gone.
So…even if sales fall off. Remember, we’re looking at a P/E of 4. Garmin has a PE of $ for crying out loud. If Garmin’s sales go down to 1/3 of what they are now…and its earnings go down to 1/3 of what they are now, Garmin’s PE would only go up to 12. It would still be dirt cheap.
So please tell me..what company, who makes a great product, whose sales are growing by 40% and earnings are growing by 60% is going to have its revenues magically drop by 70%??? It’s ain’t happening.
This stock is oversold but its product is not. If you’ve seen one of these GPS’ in action, the first thing you think of is “Wow…that’s friggin cool”. Garmin even makes a dog collar with a GPS in it so your pooch never gets lost again (well actually, you go find the dog, he doesn’t find you using the GPS…but you get the picture).
Anyway, I feel really good about this safe bet and I’m ready to receive my finest meats and cheeses with this investment.
I am HUGE!!!
$$$MR. MARKET$$$
http://www.mrmarketishuge.com
Wow…that hit my over the head like a sledge hammer. Let’s have a look shall we? In doing another value dig, I searched for a stock that had:
• Dropped more than 70% in price over the last 52 weeks.
• Had a trailing 12 month PE of less than 5. Yes less than 5. Why buy something expensive in this market? I’d rather buy something that CAN’T go much lower.
• I want Year on Year earnings growth greater than 60%
• To show consistency, I want a 3 year EPS growth of 60%
• I want annual revenue growth of 40%
• I want return on assets in excess of 20%
• I want return on equity in excess of 30%
• One more thing…I don’t want any debt on the books…zero..nada…nilch.
Only one stock fit the bill…Garmin. GRMN
Today I bought Garmin at 15.74. I will sell it in 4 – 6 weeks at 18.26. Here’s why I like Garmin:
I am sure everyone knows the Garmin story. It’s a great product. It’s 3 biggest competitors are private companies. Garmin’s market cap of 3.3 billion is bigger than all 3 of its competitors put together (Tom Tom, Magellan and some other crap company). The reason I point this out is if the recession is prolonged, then these little guys are going to be the ones who bite the bullet first….not Garmin.
Yeah Yeah…who’s going to buy a fancy GPS in a recession (even though it makes a great Christmas gift)? I’m not going to argue that point, but the world is going to last a lot longer than this recession and men are going to continue to get lost driving and they will continue to not want to ask for directions well after this recession is long gone.
So…even if sales fall off. Remember, we’re looking at a P/E of 4. Garmin has a PE of $ for crying out loud. If Garmin’s sales go down to 1/3 of what they are now…and its earnings go down to 1/3 of what they are now, Garmin’s PE would only go up to 12. It would still be dirt cheap.
So please tell me..what company, who makes a great product, whose sales are growing by 40% and earnings are growing by 60% is going to have its revenues magically drop by 70%??? It’s ain’t happening.
This stock is oversold but its product is not. If you’ve seen one of these GPS’ in action, the first thing you think of is “Wow…that’s friggin cool”. Garmin even makes a dog collar with a GPS in it so your pooch never gets lost again (well actually, you go find the dog, he doesn’t find you using the GPS…but you get the picture).
Anyway, I feel really good about this safe bet and I’m ready to receive my finest meats and cheeses with this investment.
I am HUGE!!!
$$$MR. MARKET$$$
http://www.mrmarketishuge.com