Analysts Say This Stock Is a Double

Pssst.

I've got a stock tip for you. Three of them, actually. Each of these stocks has been savaged over the past year and, hey, analysts say each of them is at least a double.

Curious? Well, here you go.

Company

Recent Share Price

Analysts' Average Price Target

Potential Upside

Sirius XM Radio (Nasdaq: SIRI  )

$0.43

$1.00

133%

UAL (Nasdaq: UAUA  )

$5.57

$17.61

216%

Blockbuster (NYSE: BBI  )

$0.85

$3.20

276%

Data provided by Capital IQ, a division of Standard & Poor's.

Great, right? There's just one glaring problem.

I wouldn't recommend these stocks to my worst enemy
You heard me. Look, if you're looking to cash in with big bets on penny stocks (and yes, I realize UAL is technically above the $5 threshold for penny stockdom), you may as well skip the "stocks" part and just buy some scratch-off lottery tickets. At least that way, you'll support local schools while you vaporize your remaining savings.

Sure, these stocks could have huge upside from these levels. My dog could also learn to fetch me a beer from the fridge. Sadly, I'm unable to bank on either. Here's why.

For starters, Wall Street analysts are notoriously inaccurate. The analysts are sheep, dragging their estimates and targets behind the market like a puppy chasing after its owner. Ninety days ago, they thought DryShips (Nasdaq: DRYS  ) would earn $4.16 a share in 2010. Sixty days ago: $3.02. Now? $0.99. Talk about staying ahead of the curve.

To me, there are some very good reasons why these companies have been hit so hard. Sirius XM has the fiscal responsibility of a first-semester freshman. I'd rather own $0.43-worth of a stake in a local car wash. Blockbuster, whose lunch is getting eaten by Netflix (Nasdaq: NFLX  ) , is suffocating under its own debt load. And I'll believe UAL can achieve consistent profitability just as soon as pigs fly. OK, so these stocks are garbage. Now what? Well, if you're ready to make the leap from a speculator to an investor, read on.

The path to huge returns
Building real wealth doesn't happen overnight, and it certainly doesn't happen by making emotional short-term bets on bad companies. Consider the following:

  • A study published in The Journal of Finance showed that investors who trade most frequently trail the market by 6.5 percentage points annually.
  • According to Wharton's Dr. Jeremy Siegel, portfolios of the highest-yielding stocks returned 4.8 percentage points higher annually, with less risk than baskets of the lowest-yielding stocks, over the years 1958-2002.
  • The list of top-performing surviving S&P 500 members from 1957-2003 is dominated by dividend payers, names like Income Investor "Buy First" recommendation PepsiCo (NYSE: PEP  ) and recent recommendation Procter & Gamble (NYSE: PG  ) .

In short, the path to building wealth and crushing the market over the long haul doesn't involve day-trading or chasing after the next rocket stock -- just patiently investing in the tried and true. Specifically: Blue chips that pay large, sustainable dividends.

Getting paid to invest
The merits of dividend-focused investing are fairly obvious: The strategy is a proven market-beater over the long run, it comes with lower-risk, and you get paid cash along the way. For perspective, the average yield of the select companies on our scorecard is 5.5%. Compare that to the puny 2.8% yield you can get on a CD.

Of course, you can't just throw darts at a dividend dartboard and hope for the best. You'll want to take a page from our Income Investor  playbook. We look to separate the wheat from the chaff by specifically looking for:

  1. Dividend yields greater than 3%. Again, research shows that stocks yielding above-market rates provide higher returns with lower risk.
  2. Capital gain potential. What can I say? We're a bit greedy. We only recommend companies trading at big discounts to their intrinsic value.
  3. Great management, great returns. We like tenured management teams that have brought home the bacon via long histories of dividend increases and double-digit returns on invested capital.
  4. Durable competitive advantages. Companies with mile-wide moats: unique, sustainable cost advantages; network effects; valuable intellectual property; high switching costs; etc.

Buy great companies. Buy them cheaply. Hold them. Reinvest your dividends. I'd be lying if I said this was rocket science. Still, you'd be shocked at just how few companies make the cut. At best, we think the universe of stocks capable of making the Income Investor grade is only a couple of hundred companies, among the thousands of publicly traded names out there.

Fortunately, Mr. Market has expanded our universe a bit by driving down the shares of first-rate businesses, including my most recent recommendation, Procter & Gamble. The illustrious P&G hasn't yet cracked our elite "Buy First" list, though. To find out which stocks have, and to receive our top new stock idea each month, you can try the service free for 30 days -- just click here to learn more.

Already an Income Investor subscriber? Log in at the top of this page.

Senior Analyst Joe Magyer owns shares of PepsiCo, but no other companies mentioned in this article. Netflix is a Stock Advisor recommendation, while Procter & Gamble and PepsiCo are both Income Investor recommendations. The Motley Fool owns shares of Procter & Gamble. The Motley Fool has a disclosure policy.


Read/Post Comments (68) | Recommend This Article (285)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 08, 2009, at 4:12 PM, asm610 wrote:

    The apology about being so off the mark on SIRIUS is going to suck for you.

  • Report this Comment On May 08, 2009, at 4:54 PM, ComfortPlayer wrote:

    "Buy great companies. Buy them cheaply."

    Wow !! Who knew it was this easy.

    Another Fooolish sales pitch. Why do I even bother to read these.

  • Report this Comment On May 08, 2009, at 5:28 PM, garyc27 wrote:

    Gee, 3 stocks from the analysts that are even too low to short!

  • Report this Comment On May 08, 2009, at 5:34 PM, automaticaev wrote:

    More random guesses?? "buy these 3 stocks and you will double your money." Next sentence "dont buy these 3 stocks they will evaporate your saveings" Nice way to cover your butt. If your just going to make rndom guesses please dont give anyone stock tips.

  • Report this Comment On May 08, 2009, at 5:34 PM, ISLERO wrote:

    Buying SIRI back in December, taking a bit of a plunge, then zipping upward and hitting $0.50 on this roller coaster biz is a tad crazy. But entering the ride at under 10 cents does give one a lovely multipal as long as one pays attention. The Feb dip to 6 cents wasn't inspiring but with the moves by Malone and Company we enjoyed taking a fine bit of change out of this terribly debt ridden company. The ride will continue, certainly, for a good while yet. And some more penneys just might fall into my pockets yet.

  • Report this Comment On May 08, 2009, at 5:49 PM, ISLERO wrote:

    Oh, by the way...my above comments not withstanding, buying such 'penny' stocks is downright foolish! (Not Motley Foolish) Make no mistake, unless you're willing and able to watch such stuff constantly it's most always a lousy deal. There's a reason that stocks sell for practically nothing. SIRI is sinking in debt. But the mashinations to keep it alive, bump some of that debt away, do inspire those extreme ups and downs. Do that only when you have the time to play.

  • Report this Comment On May 08, 2009, at 5:54 PM, Zonker wrote:

    I wish you would have given the same advice for the Motley Fool MDP. The advice and performance of this MF Gem is soooo bad they won't even publish it along with the other newsletters. The MDP is chock full of stocks like the ones you wrote about in this article.. MDP purchased stocks at the high of the market and then sold at the low of the market... and people had to pay money for this advice?!!!

  • Report this Comment On May 08, 2009, at 5:57 PM, whatelseisnew wrote:

    This is to all you Motley Fools who didnt believe in BBI and listened to analyst that are paid to hype stocks. I made more money today on BBI than you Netflix idiots do in a frickin year and risked one fortieth the money. So by all means, keep listening to these PAID morons. You are all sheep of the first magnatude.

  • Report this Comment On May 08, 2009, at 6:06 PM, dojodan444 wrote:

    The best advice you can have as far as stock market tips is to do the opposite of what "analysts" like Motley tell you to do. If you are listening to them then "a fool and his money will soon be parted!" Emphasis on FOOL. I own BBI for under a $1 a share and I have no doubt my money is about to double or triple very shortly. And I would hardly classify BBI as a "penny stock" just because it's been trading below $5 for a year or so now - it's still a multibillion dollar company...

  • Report this Comment On May 08, 2009, at 6:23 PM, whatelseisnew wrote:

    dojodan444 Hang on to BBI and make a butt load of money while these sheep make a fool out of themselves.

  • Report this Comment On May 08, 2009, at 6:40 PM, blkbrd101 wrote:

    "Wall Street analysts are notoriously inaccurate". "The analysts are sheep". So, what is the difference between Wall Street analysts and the Fool analysts. Not much, I would venture to say. Why don't the Fool analysts give us a picture of their losers as well as their winners. Is it because they probably have as many losers as they have winners. Maybe the dart board isn't so bad an idea after all.

  • Report this Comment On May 08, 2009, at 7:43 PM, longsiri wrote:

    SIRI - $1.50 by May 2010.

    2011 DirecTV & Siri merge

  • Report this Comment On May 08, 2009, at 7:46 PM, robertf36009 wrote:

    I have gotten good ideas and seen bad ideas presented by the MF team. I subscribe to Rule breakers and that news letter not only gives readers a report card and penalty box they invite your foolish opinion. As with any investment decision you must do your own due diligence. Fool on.

  • Report this Comment On May 08, 2009, at 7:52 PM, robertf36009 wrote:

    SIRI could be in deep trouble. Blaupunkt is selling a Blue tooth driven combination navigator and internet streaming radio. Good luck with that SIRI going forward. New inovative technologies are worth looking at while they are cheap. Fool on.

  • Report this Comment On May 08, 2009, at 8:06 PM, automaticaev wrote:

    i dunno your plan mabe if you plan to sell blockbuster soon you can profit. The company itself is completely useless. There is no need to rent a movie these days.

  • Report this Comment On May 08, 2009, at 8:09 PM, waewens wrote:

    Stock Advisor have had many losers. I think it is best said by Warren Buffet buy good solid company when others are scared and when others are buying do not enter the market. I have bought Ford , Sprint, and Bank of America at the bottom when others are scared when the market fell out and had great returns. I read what others are saying not just the analyst and I go to the company website and I read financials. PBR is a great buy for the future. I bought AIB at the bottom and have a 32% return. It is good common sense. Buy what people can not do with out and what they need on a daily basis. PG is my next buy. Let buy and keep the market moving and make money.

  • Report this Comment On May 08, 2009, at 8:12 PM, Novaflare wrote:

    what did I get out of reading this..... buy low sell high. ya i'll take that 6% above average over -4% well if I'm that average why wouldn't i just learn how to manage risk and day trade. I'm glad I day trade for a living i do better than 6.5% annually. woopdeedoo

  • Report this Comment On May 08, 2009, at 8:14 PM, automaticaev wrote:

    ire is long term pick let it keep going down first though.

  • Report this Comment On May 08, 2009, at 8:25 PM, TxTom wrote:

    SIRI is at LEAST a double. I was lucky enough to buy it at 14 cents. People can play down this stock all they want, but it will be above the $1 mark before long. A buck-fifty isn't at all out of the question. But what do I know, I'm only up 175% on my portfolio so far this year. A spec stock or two is entirely appropriate under those circumstances. I wouldn't rule out STEM either. Go ahead, laugh. This is an unusual market at a very rare time in history. There are those who choose to be skeptical and ridicule "different" ideas, and then there are those who profit. Pick your poison. Oh, the bank stocks aren't finished yet either. Watch Citigroup go above $6 within weeks if not sooner.... :-)

  • Report this Comment On May 08, 2009, at 8:32 PM, 78rpm wrote:

    I did not renew my SIRI subscription. My 2006 Ford has 12,000 miles on it and I only listen to three channels. Not worth renewing.

  • Report this Comment On May 08, 2009, at 8:37 PM, farmnut1985 wrote:

    Thought the fool was to provide investment advice, not speculation.

  • Report this Comment On May 08, 2009, at 8:45 PM, Notfooled1 wrote:

    Barnum was right!

  • Report this Comment On May 09, 2009, at 12:13 AM, ochamark wrote:

    These MF one way recommend a thing then they wipe off and scare the readers if they do so, then what garbage are they talking about? I followed them on their recommended "gems" and lost money, every since then I do the opposite what they say and most of the time I win. Perhaps that way MF have its value. Fooolishhhhhh!!!

  • Report this Comment On May 09, 2009, at 1:27 AM, herrmannova wrote:

    great comments....i really read seriously the imput of other fools....one question....

    Has anyone heard of the stock CNFO? I'm not used to speculating much but this water caught my eye....the price is around .20 so this is why I am not sure about it. I tried to find something on google but not much info out there.

    Do any others know something on this stock or have any advice about it....water is a good future I think but this , well, I'm not sure

    t.

  • Report this Comment On May 09, 2009, at 1:47 AM, keyjeff wrote:

    First i want to qualify that I'm uneducated when it comes to this. The end of May will complete my first year trying this. Considering i lost my butt in ALL of my managed investments, i decided to invest 3000.00 on my own instincts. At this moment my $3000.00 is worth $4957.25. My plan was to invest and when a stock doubled sell half plus the cost of the trade and keep the rest. I bought 1000 shares of SIRI Feb 6 for 17.1 cents per. on March 18 i sold 465 shares at .39

    On March 6 i bought 500 shares of AIG at .35.9 on the 16th i sold 230 shares for .82. I love penny stocks and am doing well with other stocks under 3.00. And yes, even picked a couple of bad ones.

    I did do well with BRCO(doubled my money) this was the only "Motley" pick that paid off. what i have learned this year is that the "Experts" are only as good as their last guess.

  • Report this Comment On May 09, 2009, at 2:22 AM, LeipersForkTNGal wrote:

    I, like many or MOST of us, have more to do in any given day than I have time for. Checking email has become a necessity for business, investment, and family contact reasons. I signed up for Motley Fool newsletters and subscriptions to receive what I believed would be good investment advice in a concise and time-efficient manner. What I find repeatedly, more than not, it seems, is that when I click on an email from Motley Fool with an interesting subject line, I spend several minutes of my already over-loaded time reading something that I think will lead to an important piece of advice, then find myself snookered into reading an advertising - marketing piece to try to get MORE money from me. I have let myself been enticed three times into subscribing to a different Motley Fool service that supposedly would give me the missing link to investment guru-ism, only to continue receiving more MF marketing 'HOOKS' in my email. Motley Fool directors and marketing staff should not keep stringing along and wasting the time of those of us who have already placed our faith and money in your experience and wisdom and signed on for one or more of your services. Now, we expect to have the benefit of receiving only good advice from you when we click on an email from you with an intriguing subject line. Instead, we find our email boxes inundated by emails from you that are not identified in such a way to enable us to tell which are good advice regarding our subscribed services and which are your cleverly worded advertising traps that trick us to click on them, then waste more of our time reading junk mail. As for me, I want the benefit of your advice, but I am sick and tired of wasting so much of my time weeding through your mass marketing emails to find what I have paid for. I am ready to cancel all three of my subscriptions and save myself the time you steal from me every week by sending me sales pieces with misleading subject lines. You should treat your paying customers with more appreciation and respect!

  • Report this Comment On May 09, 2009, at 2:27 AM, automaticaev wrote:

    they try to gte more money from you because they know you are ____ enough to pay for it. Its your own fault.

  • Report this Comment On May 09, 2009, at 6:40 AM, geoeustis wrote:

    Thankyou LeipersForkTNGal

    My sentiments exactly.

  • Report this Comment On May 09, 2009, at 8:17 AM, geoslv wrote:

    The Motley Fool is probably a good organization and so are the founders. In time they get so many different writers that the advice is inconsistent and not as reliable as the founders.

  • Report this Comment On May 09, 2009, at 8:18 AM, geoslv wrote:

    The Motley Fool is probably a good organization and so are the founders. In time they get so many different writers that the advice is inconsistent and not as reliable as the founders.

  • Report this Comment On May 09, 2009, at 9:36 AM, ewsdr wrote:

    After losing 50% of my retirement funds following MF advise in five news letters, I have decided to place 25% of remaining funds into commodity trading. Am I crazy, probably but MF can take credit for this move. Wish me luck!!!!.

  • Report this Comment On May 09, 2009, at 10:14 AM, Appollonia wrote:

    Gee, having just taken a trial MF subscription I'm a bit taken aback by all the barbs and the lack of kudos. Perhaps I'll just stick with my tried-and-true advisers -- they've helped me to hang in at -15% since all this mess began in fall 07. Good luck to all of you.

  • Report this Comment On May 09, 2009, at 11:25 AM, Rasko wrote:

    Appollonia: If you ignore the critics who cannot spell or use proper English, then you will feel better about TMF. You do not know if those who write here are even being truthful. They may have a hidden agenda, such as driving up the price so that they can make more money. They are sometimes lucky gamblers. If you want to be gambler, TMF is not for you. I have done well with TMF's advice, and you can too.

  • Report this Comment On May 09, 2009, at 12:11 PM, sabourins wrote:

    Just how old is this article? $0.99 for Dryships???

    Take another look at the market $8.00 close on 5-8-2009

    I think you should publish the date of your articles. I am beginning to not trust many things the FOOL is printing. Seems like - just another article. The FOOL is NOT what is used to be.

  • Report this Comment On May 09, 2009, at 12:19 PM, TMFJoeInvestor wrote:

    The date of publication is clearly marked at the top of the article, sabourins, and the DryShips figures are based on earnings per share.

  • Report this Comment On May 09, 2009, at 2:25 PM, toolstofreedom wrote:

    Sabourins, great observation on information that is clearly wrong. I also agree with you on how "The FOOL is NOT what it used to be." And to TMF Loelnvestor Sabourins is referring to earnings per share in DRYS; it is currently at $ 8.00 per share closing on May 8, 2009. Not currently at $0.99 per share on May 8, 2009 when this was published. This shows a serious lack of confidence in trusting Motley Fools advise when they do not even take the time to do the basic research that my kindergartner daughter could have done. Also BBI closed on May 8, 2009 with a profit of 22.35% if you invested $5000.00 and cashed out your shares you would have made $ 1,117.50. Not bad for a days worth of work, bringing your portfolio just with this one stock to a total of $6,117.50.

  • Report this Comment On May 09, 2009, at 2:40 PM, MFtooWordy wrote:

    LeipersForkTNGal is right. MF is way to wordy! IF Dave and Tom are not smart enough to develop information briefs with concise SubTopics which would allow the reader to get to the bottom line if that's all they want to read - then they need to just write books instead of pretending to be a subscription that recommends stocks briefly. MF newsletters eat up all my time and it's just not worth it!

  • Report this Comment On May 09, 2009, at 3:28 PM, TMFJoeInvestor wrote:

    There's no conspiracy here, folks. As the article clearly states, I'm talking about 2010 earnings, which are forward estimates by their nature. And, again, are right around $1 per share, with the nuanced penny difference depending on your source. For example: http://finance.yahoo.com/q/ae?s=DRYS

  • Report this Comment On May 09, 2009, at 3:42 PM, wuff3t wrote:

    Good grief! All this moaning!

    If you don't want to read the e-mails, just don't read them! I receive the e-mails too, I just delete them straightaway. Any information I want I find by accessing the website and the services I've subscribed to.

    Why do you feel obliged to read every e-mail you receive? Some of you must drive around at 5mph so that you can read every road-sign you pass...

    One thing I've noticed about people who are disillusioned with the Fool is that many of them just don't (or won't) grasp the Fool's investment ethos. TMF is all about holding for the long-term, but there are so many comments from people who obviously want to trade in and out and make quick money, and who criticize the Fool for not helping them do that. It's like blaming a marathon runner for not sprinting fast enough.

    If you want to trade and hold for shorter periods that's up to you, but it's pointless lambasting the Fool for not helping you do that - they never said they would.

  • Report this Comment On May 09, 2009, at 6:41 PM, ElCid16 wrote:

    When people say "fool on" it makes me want to throw up.

  • Report this Comment On May 09, 2009, at 7:32 PM, soycapital wrote:

    You guys are a bunch of complainers. Why don't you go read/post somewhere else if you don't like it here. There are plenty of places to go, find something else you know....beat it.

  • Report this Comment On May 09, 2009, at 8:26 PM, StockDude9 wrote:

    I can't believe nobody else noticed. The article states:

    "And I'll believe UAL can achieve consistent profitability just as soon as pigs fly. "

    Haven't you seen the news? "Swine Flu"

    So what's this say about UAL

  • Report this Comment On May 09, 2009, at 11:28 PM, MJHOWARD1 wrote:

    i pay for the fool... but i grow tired of the propaganda like "Analysts Say This Stock Is a Double" and you have to read and read to find out that you have to enter your email to find out more!!! why cant it be simple??? i subscribe to 2 of their offerings... i grow so tired of the b.s.

    MJH

  • Report this Comment On May 10, 2009, at 12:36 PM, Aphexwolf wrote:

    Sure show me a company that has great fundamentals, isn't bogged won by debt, is managed well, and is not slashing their high-yield dividend, and I'll sign up.

  • Report this Comment On May 10, 2009, at 1:04 PM, TMFJoeInvestor wrote:

    Sure, Procter & Gamble. Huge collection of brands (Gillette, Crest, Pampers, Tide, etc.), most of which have incredibly consistent, enduring demand. Some debt, but more than manageable (operating profits cover interest expenses 12 times.) Just raised their dividend by 10%, and the yield is currently at 3.4%.

  • Report this Comment On May 10, 2009, at 5:46 PM, JSinvestmentguru wrote:

    Don't be a motley fool, get some Deere now...sell covered writes for 2 months hence, make 10% in 2 months and get the money up front. Buy more Deere stock long with the proceeds. Any questions? You might want to go back a few months and see my advice regarding Apple....It's had quite a nice ride up.....The point of the article above, is just this. Cheap stocks aren't a good deal. I've owned some that went belly up and the shareholders lose everything, later the bondholders can see the company for billions... i.e. WCOM a few years back.... GM or Chrysler in the near future....Buy companies that have good products that you personally would buy and use and companies that aren't swimming in debt.

    j8

  • Report this Comment On May 10, 2009, at 5:49 PM, JSinvestmentguru wrote:

    Don't be a motley fool, get some Deere now...sell covered writes for 2 months hence, make 10% in 2 months and get the money up front. Buy more Deere stock long with the proceeds. Any questions? You might want to go back a few months and see my advice regarding Apple....It's had quite a nice ride up.....The point of the article above, is just this. Cheap stocks aren't a good deal. I've owned some that went belly up and the shareholders lose everything, later the bondholders can see the company for billions... i.e. WCOM a few years back.... GM or Chrysler in the near future....Buy companies that have good products that you personally would buy and use and companies that aren't swimming in debt.

    j8

  • Report this Comment On May 10, 2009, at 5:51 PM, JSinvestmentguru wrote:

    sorry for the double post, I double clicked I guess.

  • Report this Comment On May 11, 2009, at 12:09 AM, MotleyGulibles wrote:

    The Motley Fool, bunch of sorry losers. Or should I say, their subscribers. Save your money, ignore the MF. Years later MF still touts Marvel as their 600% gainer...have squeezed the Buffet way to the last drop on their bla- bla marketing campaigns.

    Silly Fools and silly bonnets!

  • Report this Comment On May 11, 2009, at 12:12 AM, mlb45 wrote:

    MF is no better than any other advisor. Especially when it comes to UAL. They seem to focus a lot on UAL and always bad. Why? There last advise was UAL lost 40% value so stay away. Well if they watch the stock it's fluctuates 40-50% up and down from one week to the other. I have made a small fortune on them. It's like clockwork. Up and down. Check it out. To all you here your better off listening to your own gut feeling then these guys who got us into this mess in the first place. If they are so great they would all be billionaires.

  • Report this Comment On May 11, 2009, at 11:44 AM, moneygame34 wrote:

    I think BBI is fool's gold if you hold it too long.

    They might be a low risk for short term rewards.

    On Thursday this week, they must show that they have $250M in assests just to satisfy there lenders to restructure a deal in which they owe over $600M.

    This company is losing money just about every quarter.

    The youth of today is downloading,pirating,copying movies for free which will only get worse. I have some BBI at .58 a share and I am worried about Thursday. If they restructure the deal(which I think they will) then this stock will steady go up the rest of the year. September 2010 when the 250M is owed is a serious trouble date for this company.

    Get out before next summer.

  • Report this Comment On May 11, 2009, at 12:16 PM, imacg5 wrote:

    Actually the analysts that cover the Dry Bulk shipping sector have done a fair job of calling for falling revenue over the next few years. They made those assumptions based on the growing fleet, and fall in demand for Ore , Coal and grains. I'm not sure in the case of DRYS that you should expect them to foresee the penalties for the cancellation of 13 ships, and the diminished income from those cancellations, a general raiding of the cookie jar by the CEO.

    And how were the analysts to know that the share count would go from 43 million to 185 million, and since this article was posted that will rise by another 70 million shares. You want them to stay ahead of that curve?

    It's hard to see why you would be so boastful of a buy and hold strategy. Both your stocks fell from over $70, to sub $45. Small dividends don't provide as much reward as being informed and nimble enough to sell in a bear market. Am I using perfect hindsight to make my point? Yes, and so are you.

    My problem is that in doing DD some people will find an article that is a Motley Fool or Seeking Alpha opinion piece, masquerading as a Legitimate Analyst opinion.

    Such as the headline, "A big upgrade for Excel Maritime". There should be a guideline for integrity before an article like that is carried by all the Financial Web pages.

    Unlike the author of that article, the real analysts don't find it a vote of confidence for the company to sell shares to insiders for $1.75. They also don't feel the company should have counted "Amortization of below market charters" towards the revenue that was used to make forward earnings assumptions.

    And the analysts are fully aware that there are at least two years of tough times and falling earnings for Bulk companies.

  • Report this Comment On May 11, 2009, at 2:32 PM, dojodan444 wrote:

    This is in response to comments received over the weekend, in general to my post about BBI. Don't feel like you've been singled out! I purchased BBI for under $1 a share, of course I don't expect the company to go back up to $20 a share - the market has considerably changed since then and yes competition is fierce from Netflix and cable companies. But Netflix has nowhere else to go but down. Movies by mail? Right! How long is that going to last before everyone has on demand options? Not long. BBI however is making other means of income such as their in-store video game sales which is still worthwhile to rent games as opposed to purchasing them brand new for $50. Plus BBI still rents a large selection of titles (including foreign films) not available from Netflix, cable companies or kiosks like Redbox.

    Many of you old fuddy duddies can't relate to gaming, but it's a completely different animal from DVD rental. And BBI is beating Net Flix to the punch on this, plus you can't download video games from cable companies. So in the short term, expect BBI to double or triple from that $1 a share - it's already nearly $1.50 today despite the overall market being down!

  • Report this Comment On May 11, 2009, at 2:50 PM, mpendragon wrote:

    Given the high value the Fools place on dividends it's unfortunate that CAPS doesn't factor in dividends more directly in their comparison against the S&P 500 as part of their scoring model. I think this undervalues organizations with very healthy cash flow but low potential for growth.

  • Report this Comment On May 12, 2009, at 12:27 PM, jddubya wrote:

    herrmannova -

    Take a look at www.cnfowater.com

    Definitely total speculation and a probable loser. Not for the typical investor imho. I'll probably gamble a little bit on it.

  • Report this Comment On May 13, 2009, at 5:41 PM, Alex1963 wrote:

    I tried 3 MF subscriptions for the 30 day free period when I first joined MF. I learned a ton and got some great ideas for companies to further investigate. Some I bought some I passed.

    I would respectfully remind the complainers that no advisor is a substitute for your research & judgment. No investor is right all the time or even runs 50-60% for long.

    Read investing books, stay on top of the news (not financial TV news), question and discover etc but above all you have to figure out your own strategy and style and stick to it.

    Blaming others for your own decisions to buy or not is a dead end. You will learn nothing of value that way.

    Also I have learned that different contributors on the staff have different specialties, philosophies and styles of investing. That's one of the many things I like about TMF it has variety of opinions and many different ways to capitalize if you pay attention. If you are simply receiving picks from a service and blindly buying what is advised then I'm sorry but you don't deserve to make money. If it were that easy we'd all be rich including the staff here. This is common sense and tho I appreciate people have lost money, get upset and want to vent it is frankly embarrassing to read some of these remarks.

    I think BBI is also a bad investment unless they can modify their business model with some innovation. I joined Netflix and rarely go to BBI anymore. Their model is failing, the way they value inventory by counting 3 month old movies as "new release" is accounting trickery and they have little appeal for the consumers poised to drive the future economy. They are sort of an old guys idea of a hip business model (I can say that as a 45 year old), IMO. On demand cable and dish will eventually shutter this company.

    Good luck (the last critical piece of any successful portfolio :)

    Alex

  • Report this Comment On May 15, 2009, at 10:25 AM, smaulcap wrote:

    I have to say, I have never read so much stupidity in my life. I read a lot of news letters and other market related articles. MF is a joke. I read it for fun. I take MF mostly with a grain of salt. Sure....They get some things right, and make sense sometimes. But, more often than not, MF is pure nonsense. They are real good at insulting the intelligence of their readers, that's for sure. I give them high marks for that. I recently read a MF article where the writer called solar technology an "unproven technology" Does that statement insult your intelligence? It insulted mine. He was warning readers to stay far away from FSLR because solar is an "unproven technology." A few days after the article, FSLR went up $30.00 per share, after a good quarterly report! Can you imagine an idiot giving advise and direction by telling readers that solar is an unproven technology, stay away from it, a poor long term investment. That MF article took what little credibility MF had and blew it right out of the water.

    I don't know why they call themselves Motley Fool. I mean....Really, they're not motley at all.

  • Report this Comment On May 15, 2009, at 10:33 AM, W4AGA wrote:

    [quote]

    After losing 50% of my retirement funds following MF advise in five news letters, I have decided to place 25% of remaining funds into commodity trading. Am I crazy, probably but MF can take credit for this move. Wish me luck!!!!.

    [/quote]

    If you are gambling in the market with your retirement funds then you don't need luck, you need some serious financial counseling!

    Never buy with money you can't afford to lose!

  • Report this Comment On May 15, 2009, at 2:38 PM, jbrt wrote:

    I never knew so many knew so much .... " the dumber the farmer - the bigger the potata " , makes about as much sense as half the comments .

  • Report this Comment On May 15, 2009, at 4:13 PM, hadoqur wrote:

    I agree with ComfortPlayer all this article is a sales pitch. Why can't you stop sending this stuff to people who are already members. It is just a waste of my time and gets mixed in with the newsletters and stuff I do want to read. Enough already!

  • Report this Comment On May 15, 2009, at 5:42 PM, byebyebanksters wrote:

    So, how is that bbi stock doing for you guys today after the 28% drop - still hoping to triple your money? Dabbling in penny stocks is risky and requires watching the market continually. I agree with the author on this point

  • Report this Comment On May 15, 2009, at 5:45 PM, robwherrett wrote:

    Interesting (not!) the extent to which two sorts of people feel able to comment on this site.

    The first continually rubbish the MF's ideas/picks - so what on earth are they doing on here in the first place?

    The second pick holes in individual recommendations - yet the whole point of the MF (as I understand it) is to establish a philosophy of investing (in whichever sector) and make some sense of the way forward.

    You may or may not be interested to know that I have followed some of their advice - by reading the underlying assumptions and logic. To date it has stood me in good stead.

    Take the recent post about Midstream Energy Partnerships. Ended up with Markwest Energy Partners - a scheduled distribution running at almost 16% this year on the purchase price and the potential for some capital appreciation over the coming 12-18 months. If it maintains its distribution strategy into the future that is almost equivalent to a Bond with a running yield of 15%+ tax free. That HAS to be a worthwhile recommendation in anyone's book.

    I would never have known about this stock without MF promoting the logic of this peculiar tax-break. It didn't take too much additional research to figure out one to invest in either.

    So if you don't like what is said - quit moaning and go somewhere else. Otherwise add some sense to the debate instead of the mickey mouse c**p.

    Readers don't have to subscribe to the MF reports to make some sensible use of the information they put there free for all to interpret.

  • Report this Comment On May 15, 2009, at 7:01 PM, Kosmo60 wrote:

    If all you detractors hate the Fool so much, WHY ARE YOU READING IT?!? If you don't like it, turn it off, go away and sulk in your negativity somewhere else!

  • Report this Comment On May 15, 2009, at 7:26 PM, Netteligent09 wrote:

    Bankruptcy is the Only Best Option for Blockbuster and Sirius.

  • Report this Comment On May 15, 2009, at 8:39 PM, stockjock43 wrote:

    I concurr... the fools aint what they used to be...too many hacks on the staff......

    back to the good ol days where quality is better than quantity...and im back in

  • Report this Comment On May 18, 2009, at 12:58 AM, tablethree wrote:

    The MF has always been entertaining and helpful. Plus the educational side is second to none. I don't subscribe to any of the news letters now but I plan on doing so in the future - oops! I guess I'll be engaging in real capitalism if I pay for someone's work.

  • Report this Comment On September 26, 2009, at 6:43 AM, BucketOfOnions wrote:

    Let's say you're a shareholder of a publicly held company that cleans homes and offices. The year's revenues are $100 million. Wages and salaries are $80 million. Vacuum cleaners, rags, uniforms, trucks, and gas cost $10 million. Corporate income taxes come to $3 million. The net, after-tax earnings for the year - drumroll, please - are $7 million ($100 - $80 - $10 - $3).

    The company has 10 million shares of stock outstanding, including those owned by employees, institutions, and individual investors. With net, after-tax earnings of $7 million, the earnings per share (EPS) are $.70 ($7 million earnings divided by 10 million shares).

    The Board of Directors decides to pay dividends of $3 million for the year. (Actually, Boards make such decisions quarterly.) With $7 million net earnings, less the $3 million paid in dividends, $4 million remains. The company buys more vacuum cleaners, rags, uniforms, trucks, and gas to stimulate further growth.

    Not all companies pay dividends, of course. High-technology products become obsolescent so quickly that most high-tech companies must spend every nickel to keep up. The entire return to shareholders depends on the stock price appreciation. (The darn things don't always comply.)

    On a per-share basis, the dividends come to $.30 ($3 million of dividends divided by 10 million shares outstanding). Let's say the price is $14 a share. The dividend yield is the annual dividend per share ($.30) divided by the current price per share ($14), making the yield 2.1 percent. We're talking high finance, kiddo.

    Although the dividends may change quarterly, the prices of many stocks fluctuate from second to second. If the company's price rises from $14 to $16, which it could do by the morning coffee, the dividend yield drops from 2.1 percent to 1.9 percent (the annualized dividend of $.30 a share divided by the new price of $16). Shareholders don't mind the yield declining, because the price rise increases the holding's value. But then again, the dividend is cash-in-hand, while the price could drop back to $14 by teatime.

    ---------------------------

    Money without intelligence is like a car without a road.

    http://www.intelligentinvestingtips.com

  • Report this Comment On August 07, 2010, at 11:52 AM, paeanhera wrote:

    Two out of three ain't bad. Sirius did double in ten months but there's little action with that issue. Blockbuster was a bust. NYSE delisted it. BUT, UAUA has gone up five fold between June 2009 and July 2010.

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