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Danger Zone: Value Investors

Tuesday, April 1st, 2014 7827785878_34859830a8_m

Check out this week’s Danger Zone Interview with Chuck Jaffe of Money Life and MarketWatch.com.
Value investors are in the… Read more >>

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“Index” Label Myths

Friday, May 31st, 2013 “Index” Label Myths

The word “index” in an ETF label does not always mean that investors are getting the specific exposure they seek. Diligence on ETF holdings is necessary despite what the providers might have you believe. Below I dispel the following myths concerning index ETFs.

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S&P Says Ratings Were Never Meant To Be Reliable

Monday, April 29th, 2013 S&P Says Ratings Were Never Meant To Be Reliable

S&P admits its ratings were never supposed to be reliable. How’s that for proof you need to do your own diligence?

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How To Avoid the Worst Style ETFs

Tuesday, March 26th, 2013 HowWorstStyleETFsFig1

Picking from the multitude of style ETFs is a daunting task. We are here to make it simpler and smarter.

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Best & Worst ETFs & Mutual Funds: Industrials Sector

Tuesday, January 29th, 2013 Industrials_Fig5

The Industrials sector ranks fourth out of the ten sectors as detailed in my Sector Rankings for ETFs and Mutual Funds report. It gets my Neutral rating, which is based on aggregation of ratings of 16 ETFs and 18 mutual funds in the Industrials sector as of January 25th, 2013.

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Don’t Trust This Utility’s Dividend

Tuesday, September 18th, 2012 Fig1_ConEd

Smart investors consider more than just the dividend of a stock. They also consider the principal risk. If the principal risk is greater than the dividend yield then the dividend is of no real value. I see the principal risk of this stock at more than 15% with a fair value closer to $50 – after adjusting for the pension accounting shenanigans.

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The Danger Zone Pick: 9/17/12

Monday, September 17th, 2012 The Danger Zone Pick: 9/17/12

The impact on valuation: instead of a fair value in the mid $50s, I now see it in the low $40s – about 30% lower than where the stock is today. 30% dwarfs the 4% dividend yield.

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Goldman’s Sell Rating on DAL Follows My Short Call

Friday, July 13th, 2012 Goldman’s Sell Rating on DAL Follows My Short Call

Yesterday, Goldman Sach’s initiated on Delta Airlines (DAL) with a Sell Rating. This stock call comes two months after my note to clients recommending shorting DAL.

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How To Survive the Euro Crisis

Tuesday, June 26th, 2012 How To Survive the Euro Crisis

As I wrote in “Don’t Be Fooled: Get Short Now”, the euro is not that different from Enron, WorldCom or the Madoff fund. All of these organizations were able to pretend they were profitable or solvent long after they were insolvent.
Now markets are finally acknowledging the intractability of the Euro debacle.

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Top Stock Picks & Shorts: Moneylife Radio Interview w/ Chuck Jaffe

Friday, June 8th, 2012 Top Stock Picks & Shorts: Moneylife Radio Interview w/ Chuck Jaffe

Listen in on my 15 minute interview describing the rigorous diligence New Constructs applies to every rating on the stocks, ETFs and mutual funds we cover.

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Why is S&P Raising Its Outlook on Delta (DAL)?

Tuesday, June 5th, 2012 DAL_Fig2

After S&P’s recent upgrade to its outlook on Delta Airlines [s: DAL], I cannot help but to wonder how they do their analysis.

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Barron’s Features My Analysis on DAL’s Abnormal Pension Accounting

Saturday, May 26th, 2012 Barron’s Features My Analysis on DAL’s Abnormal Pension Accounting

In his weekly column, The Trader, Vito Racanelli features my in-depth work on the funky accounting Delta Airlines’ (DAL) uses… Read more >>

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“S&P: Delta could be in line for upgrade” – Are they kidding?

Friday, May 25th, 2012 “S&P: Delta could be in line for upgrade” – Are they kidding?

I do not think S&P’s analysts are aware of Delta’s staggering $22.3 billion in off-balance sheet liabilities, which include $14.1 billion in underfunded pensions and $8.2 in operating leases.

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Bail Out of DAL Before the Stock Crashes

Friday, May 18th, 2012 DAL_EEvEPS

I recommend investors avoid Delta Airlines (DAL). I think the stock could see significant downward pressure as more investors realize how the company is propping up its earnings with relatively aggressive accounting for its pension and postretirement plan (“pensions”), which are already seriously underfunded.

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