7/16/07

Economics

This month’s lead Fortune article on the global economy:

http://money.cnn.com/magazines/fortune/fortune_archive/2007/07/23/100134937/index.htm?section=money_latest

a rising tax and regulatory burden (Government has never proven that it could solve economic problems efficiently or satisfactorily.) The global economy booms as taxes fall:

http://www.usnews.com/blogs/capital-commerce/2007/7/13/global-economy-booms-as-taxes-fall.html

Politics

Domestic

International War Against Radical Islam

The Market

Technical

Fundamental

Investor sentiment is still cautious--which is bullish:

http://www.marketwatch.com/news/story/contrarians-believe-further-market-gains/story.aspx?guid=%7B9706AC13%2D8E21%2D48DB%2DAE1B%2D3B3A10C3F77F%7D

As you know, Magellan Midstream Partners was added to the High Yield Buy List last week. This is a master limited partnership that is involved with the transportation, storage and distribution of refined petroleum products in the US. Since its founding in 2001, the partnership has grown earnings from $.95 a share to $2.24 in 2006 and dividends from $1.01 in 2001 to $2.34 in 2006. While these growth rates will slow, they nevertheless should continue as the partnership expands its capacity as well as its products and services. Providing a current yield of 5.3% with the expectation of growing its dividend by 6-8% over the intermediate term, this investment provides an attractive total return.

EPS: 2006 $2.24, 2007 $2.40, 2008 $2.55; DVD: $2.46, YLD 5.3%

http://finance.yahoo.com/q?s=MMP

News on Stocks in Our Portfolios

Alcon Inc (Aggressive Growth Portfolio) is acquiring Wavelight AG, a developer and manufacturer of refractive laser and diagnostic systems used in eye surgery.

EPS: 2006 $4.35, 2007 $5.15, 2008 $5.90; DVD: $1.50, YLD 1.5%

http://finance.yahoo.com/q?s=ACL

An update on Graco (Dividend Growth Portfolio):

http://www.bloggingstocks.com/2007/07/15/graco-still-working-on-a-growth-strategy/

EPS: 2006 $2.17, 2007 $2.55, 2008 $2.90; DVD: $.68, YLD 1.6%

http://finance.yahoo.com/q?s=GGG

Market Analysis

More Cash in Investors’ Hands

IHOP is buying Applebee’s for $2.1 billion in cash.