3/13/08

Economics

The economics of ethanol:

http://www.ibdeditorial.com/IBDArticles.aspx?id=290119894243935

Politics

Domestic

Obama on social security:

http://online.wsj.com/article/SB120528180300228815.html

International War Against Radical Islam

The Market

Technical

Fundamental

Aggressive Growth Buy List

Company Close 3/12 Buy Value Range

Amphenol $35.84 $35-40

Ecolabs 44.57 43-49

Fastenal Inc 40.55 36-41

Franklin Resources 93.25 82-94

Mastercard 203.90 178-205

Microsoft 28.63 26-30

SAP Inc 49.05 46-54

Reliance Steel 56.24 48-55

Company Highlight

Charles Schwab Corp is a holding company whose primary subsidiary is Charles Schwab and Co, a retail discount securities broker serving almost 6.7 million investors with approximately $1.2 trillion in assets. The company has earned a 20%+ return on equity over the last several years while growing profits and dividends between 15-20%. SCHW should continue to produce above average returns as:

(1) a gradually improving economy lifts cash flow from current clients,

(2) the company’s aggressive marketing effort increases its customer base,

(3) an aggressive acquisition program for non commission services such as asset management both domestic and international, and trust services to registered investment advisors which will increase cash flow stability and

(4) its ongoing restructuring and cost reduction plan yields wider margins.

The company is rated A by Value Line, has a capital structure that contains only 7% debt and its stock yields approximately 1%. Further , the company has a large stock buy back program and paid a $1.00 a share special dividend last year--signs of management’s commitment to share the company’s success with stockholders.
http://finance.yahoo.com/q?s=SCHW

Subscriber Alert

The stock price of Pfizer (PFE-$22) has fallen below the lower boundary of its Buy Value Range. Accordingly, it is being Removed from the High Yield Buy List. The High Yield Portfolio will continue to Hold PFE.

Yesterday the Aggressive Growth Portfolio Sold the remaining shares of its position in UnitedHealth Group (UNH-$37). At the Market open this morning, the Aggressive Growth Portfolio will Buy additional shares of Mastercard (MA-$200) and Reliance Steel (RS-$54).

The stock price of Blackrock Inc (BLK-$170) has fallen below the upper boundary of its Buy Value Range. Accordingly, it is being Added to the Aggressive Growth Buy List. The Aggressive Growth Portfolio will Buy a one half position at the Market open this morning.

News on Stocks in Our Portfolios

More Cash in Investors’ Hands