General Body Meeting 9/15/10 1. Mutual Investment Club of Cornell Agenda Announcements Junior...
-
date post
21-Dec-2015 -
Category
Documents
-
view
216 -
download
0
Transcript of General Body Meeting 9/15/10 1. Mutual Investment Club of Cornell Agenda Announcements Junior...
General Body Meeting 9/15/10
1
Mutual Investment Club of Cornell
2
Agenda
Announcements Junior analysts Upcoming info sessions
Financial regulation headline Portfolio review General Growth Properties Update Brain teaser answer Conclusion
Mutual Investment Club of Cornell
3
Junior analysts
Tech: David Kim, Zach Peskin, Josh Lyons, Nicole Kim Media: Macro: Duane Mitchell, Larry Kogos, Mollie Maher Financial Institutions: Phil Crawford, Adam Nicoletti,
Albert Esteves, Jessica Zapas Real Estate: James Bosco, Wen Jun Wong, Brian Hong Energy: Steph Menke, Andrew Schoen, Stephen Lane,
Andrew Kugler Consumer/Retail: Philip Gatto, James Rockas, Andrew
Schrichte Industrials/Basic Materials:
Mutual Investment Club of Cornell
4
Buying shares
All members participating in the management of the fund must purchase a minimum of 3 shares
Investments will be collected next week
Mutual Investment Club of Cornell
5
What to do next
If you are a junior analyst Reach out to your senior analyst and
await instructions Attendance at general body meetings is
mandatory If you are not a junior analyst
Highly encouraged to attend education sessions (5:00-6:00pm)
Mutual Investment Club of Cornell
6
Basel III
Banks will have to keep more capital on hand to protect against huge investment losses They have to hold common equity to the
value of 4.5% of their assets by 2015 up from 2%
By 2019, need a 2.5% capital conservation buffer of common equity to be run down during financial stress
Tier 1 leverage ratio of 3% Bank stocks led gains for Europe’s
stock markets The euro gained 0.7% against the dollar
Mutual Investment Club of Cornell
Credit Suisse Group(CS)
P/E ratio 9.2 compared to industry 10.7 CHF 14 million net inflows of new
assets Increase in market share in AM and IB Industry-leading capital strength; Tier 1
of 16% Continued movement to a more
conservative risk profile Hiring up 5% Q2 EPS of $1.12 with share price of
$46.91 Recommendation: Hold
Mutual Investment Club of Cornell
Technology Sector Holdings
Cisco Systems, Inc. (CSCO) Consumer electronics, networking and
communications Hewlett-Packard (HPQ)
Computing, data storage, and networking hardware
iGo, Inc (IGOI) Power products for electronic devices
Mutual Investment Club of Cornell
Cisco and HP
Mutual Investment Club of Cornell
iGo, Inc
Different story from Cisco and HP Short-term play
Mutual Investment Club of Cornell
11
América Móvil (NYSE: AMX)
Mutual Investment Club of Cornell
AMX- Overview
Leading provider of wireless telecommunications in Mexico, owned by Carlos Slim
Fifth largest mobile operator (number of subscribers) in the world
Largest company in Latin America: operates throughout Latin America, U.S.A., and South America
12
Mutual Investment Club of Cornell
AMX – Recent News
Performance since summer: up 3% Fixed line expansion to compete with
telefonica Acquires Telmex, Mexico’s largest carrier
of telephone and Internet service Partially owns NETC, largest cable
operator in Brazil Q2 Earning
Subscribers up 30.7% Revenue up 12% YOY
13
Mutual Investment Club of Cornell
14
AMX - Analysis
Bullish on Latin America Control over Mexico telecom market Growth in fixed line operation Strong liquidity position Some concern over 3G competition
Mutual Investment Club of Cornell
GLD
Current Price: 123.99
Mutual Investment Club of Cornell
16
GLD (continued)
Falling value of the USD Against Euro, CAD, AUD, Asian currencies
Growth and strong demand from China and India
Consistent fear of inflation (though experienced volatility along the way)
Mutual Investment Club of Cornell
Union Pacific Corp (UNP)
Recommendation: Hold Thesis:
Best way to play recovering economy
Efficient method of transportation
Undervalued Great business with a
durable competitive advantage
Mutual Investment Club of Cornell
18
Major Events Since Purchase
Post purchase drop Bad outlook by
management Rebound
Warren Buffett: BNI
Reports earlier this year of higher car loadings.
Mutual Investment Club of Cornell
19
Recent Events
Q2 Earnings Record EPS of $1.40
52% improvement yoy.
Total revenue growth of 27% yoyAll segments
Operating Ratio of 69.4%Best ever
Mutual Investment Club of Cornell
20
Occidental Petroleum (OXY)
Recommendation: Hold
Oil and gas producer Small chemical
business Strong balance sheet
Debt/Equity .08 Steady production
gains Primarily onshore
Mutual Investment Club of Cornell
21
Original Thesis
Oil was undervalued
Good reserve replacement ratio
Well run company
Mutual Investment Club of Cornell
22
Second Quarter Earnings
Q2 2010 net income $1.1 billion ($1.31 per diluted share).
Quarterly yoy production volume growth of over 3 ½ percent. Management style
Mutual Investment Club of Cornell
23
Boardwalk Pipeline Partners (BWP) Simple: Gas
transportation and Storage in Southeast Region
Tax advantaged set-up
Dividend of 6.5%
Mutual Investment Club of Cornell
24
Thesis
Take the yield Natural gas supply growth pipeline
demand increase. Profit and yield will rise.
Barriers to competition If market range bound, profit comes
from dividends
Mutual Investment Club of Cornell
25
Recent events
Q2 Earnings Revenue disappoints
Likely temporary Joint anomalies Basis spreads on
interruptibles
Macroeconomic weakness
Treasury yields dropping
Range bound market
Mutual Investment Club of Cornell
Procter & Gamble
The Procter & Gamble Company manufactures and markets consumer products in countries throughout the world.
The Company provides products in the laundry and cleaning, paper, beauty care, food and beverage, and health care segments.
Procter & Gamble's products are sold primarily through mass merchandisers, grocery stores, membership club stores, drug stores, and neighborhood stores.
26
Mutual Investment Club of Cornell
Original Thesis
Portfolio of strong billion dollar brands Consumer preference for quality and
strong value in tough economic environment
Consistent strong performance throughout all markets
Trading at a discount due to fearful market sentiment despite stronger fundamentals
Low risk play on economic recovery
27
Mutual Investment Club of Cornell
Flat Performance, Currently at $60.64
28
Mutual Investment Club of Cornell
Updates
New Environmentally Friendly Compacted Laundry Detergent Formula to join Future Friendly Portfolio of Products
P&G reaffirmed expected organic sales growth of 4-6%
P&G investing $1 billion over 5 years in China to develop research and manufacturing centers closer to consumers
Look for PG to beat analyst estimates and for the stock price to bump up