Olstein Says "Cash is King"

In the New York Times this weekend, Jeff Sommers published an article "Beating the Market, A Reachable Goal" , where he interviews money manager Bob Olstein.

"Mr. Olstein looks for stocks that are under appreciated, and that are strong in a metric he has always favored: “free cash flow yield.” (It is cash, after subtracting capital expenditures and working capital, divided by market capitalization.) “Cash is king,” he says. “That’s what you’re paying for when you buy a stock — the ability to generate cash. But few people even bother with it these days.” He says he prefers “boring companies” — if their free cash flow excites him"

Equities Research archives of Bob Olstein articles 

• OLSTEIN Earnings vs Cash Flow

• Olstein Shareholder Letters 

• (Olstein)Eight Warnings you want to See by Herb Greenberg 2000

• There are Nice People on Wall Street

• Olstein BullishOn Dupont & Cisco

• Olstein Eyes Microsoft & Intel

• Olstein: "Free Cash Flow is Air of Corporations"

 

Bob Olstein Favorite Metric: FREE CASH FLOW

This afternoon money manager appeared on CNBC-TV to discuss his three top picks:

• Harmon International (NYSE: HAR)
• General Electric (NYSE: GE)
• Dupont (NYSE: DD)

Olstein:"Free Cash Flow is the Ultimate Arbiter of Valuation".




More on Free Cash Flow from Bob Olstein can be found:

• Equities Research: Olstein Funds Recommended Reading
• Equities Research: Olstein: "Free Cash Flow is Air of Corporations"
• Equities Research: Bob Olstein's Focus is Cash Flow
• Equities Research: Olstein Bearish on AMZN: A Look at ...
• Equities Research: Olstein: Earnings vs. Cash Flow
• Equities Research: Olstein Bullish on Dupont & Cisco
• Equities Research: Olstein Eyes Microsoft & Intel

My Barber: "Joe the Barber"

Dow Jones Index Needs a Shuffle to take Average to 20,000

Dow Jones Index Needs a Shuffle to take Average to 20,000

(This article by Tommy Renna was  published at Seeking Alpha)

A year ago United Health Group, Inc. (NYSE: UNH) was added to the Dow Jones Industrial Index (DJIA) to replace Kraft Food, Inc, after Kraft’s plans to spin off its American grocery business. Although UNH only accounted for approximately 3% of the index‘s weighted average, the stock’s 29.6% return was the 4th best stock performer of the 30 stocks in the index contributing to the average’s gain of 9.06% since being added through to yesterday’s close. Below is the performance of the Dow Jones Industrial Average and the 30 components since UNH was added on September 24, 2012. (Clicking on the Corporations’ names are links to Stockdiagnostics.com Charts of each stock through the date of the change on September 2012).

Ticker	Company	9/21/12	8/30/13	% return
BAC	Bank of America	$9.09	$14.12	55.34%
BA	Boeing Co.	$68.43	$103.92	51.86%
HPQ	Hewlett-Packard	$17.21	$22.34	29.81%
UNH	UnitedHealth Group Inc.	$55.50	$71.74	29.26%
JNJ	Johnson & Johnson	$66.90	$86.41	29.16%
HD	Home Depot Inc.	$58.54	$74.49	27.25%
CSCO	Cisco Systems Inc.	$18.34	$23.31	27.10%
JPM	JPMorgan Chase	$39.76	$50.53	27.09%
UTX	United Technologies Corp.	$78.87	$100.10	26.92%
AXP	American Express Co.	$57.11	$71.91	25.91%
MMM	3M Co.	$91.00	$113.58	24.81%
PFE	Pfizer Inc.	$23.70	$28.21	19.03%
TRV	Travelers Cos.	$67.39	$79.90	18.56%
DIS	Walt Disney Co.	$51.94	$60.83	17.12%
PG	Procter & Gamble Co.	$67.30	$77.89	15.74%
DD	E.I. DuPont de Nemours	$50.03	$56.62	13.17%
MSFT	Microsoft Corp.	$30.25	$33.40	10.41%
DJIA	Dow Jones Indust Ave	13,579.47	14,810.31	9.06%
VZ	Verizon Communications	$43.72	$47.38	8.37%
MRK	Merck & Co. Inc.	$43.66	$47.29	8.31%
CVX	Chevron	$114.02	$120.43	5.62%
GE	General Electric Co.	$21.97	$23.14	5.33%
MCD	McDonald's Corp.	$91.42	$94.36	3.22%
KO	Coca-Cola Co.	$37.24	$38.18	2.52%
WMT	Wal-Mart Stores Inc.	$72.68	$72.98	0.41%
INTC	Intel Corp.	$22.22	$21.98	-1.08%
XOM	Exxon Mobil	$89.53	$87.16	-2.65%
T	AT&T	$36.26	$33.83	-6.70%
CAT	Caterpillar Inc.	$89.45	$82.54	-7.72%
IBM	Internat'l Bus Machines	$202.26	$182.27	-9.88%
AA	Alcoa Inc.	$9.00	$7.70	-14.40%
KFT	Kraft Foods	$51.93

Since Being added to DJIA, Bank of America is Down 63% 

Although Bank of America (NYSE: BAC) was the top performing stock in the chart above with a 55% return, shares are still 63.54% lower since being added to the Dow Jones Industrial Index on February 19,2008.  Chevron was also added to the index on the same day as Bank of America and CVX shares are 73.38% higher. Since the stocks were added to the DJIA the index has gained 19.94%.

Prior to United Health Group being added to the Dow Jones Index, the last change to the index was made on the opening of June 8, 2009 with the addition of Cisco System (NASDAQ: CSCO) and Traveler Cos. (NYSE: TRV). Since the 2009 change Cisco has gained 23.66% and Travelers is up 105.03%, while the DJIA is 69.01% higher.

Today’s Dow Jones Industrial index has changed significantly since its inception to adapt to the changing landscape of America. Alcoa (NYSE: AA), Caterpillar (NYSE: CAT) and Hewlett-Packard (NYSE: HPQ) are no longer considered leaders in today’s market place and although HPQ stock has performed well of late, the stock performance is not indicative of the underlying business’s future growth. Its time for companies, Google (NASDAQ: GOOG), Apple (NASDAQ: AAPL) and Wells Fargo (WFC), that dominate the marketplace and the world economy to be added to the index to help get the index to 20,000 and beyond.

29 GFNN Stockdiagnostics Portfolios of best Cash Flow Growth Stocks (and weakest)

Performance of 27 Stockdiagnostics Downgrades of Stocks with Negative Cash Flow

Under Armour, Disney, First Solar, Zillow, Papa Johns, Amgen & More

A look at Quarterly Cash Flow: Disney (DIS),Under Armour (UA),Jazz Pharmaceutical(JAZZ), Zillow(Z),Amgen(AMGN),Papa John's (PZZA), DST Systems (DST), MercadoLibre (MELI), PDF Solutions (PDFS), First Solar (FSLR)

$Z Q2 2013 $6.2 million operational cash flow, a decline of $4.3 million vs Q2 2012 . 17% decline

— tom renna (@GFNNstock) August 7, 2013

$DIS Q3 2013 $3.4 Billion operational cash flow, an increase of $528 million vs Q3 2012 . 18% increase

— tom renna (@GFNNstock) August 7, 2013

$AMGN Q2 2013 $1.6 billion operational cash flow, a decline of $775 million vs Q2 2012 . 33% decline

— tom renna (@GFNNstock) August 7, 2013

$PZZA Q2 2013 $17.3 million operational cash flow, a decline of $3.7 million vs Q2 2012 . 18% decline

— tom renna (@GFNNstock) August 7, 2013

$JAZZ Q2 2013 $8.7 million operational cash flow, a decline of $68 million vs Q2 2012 . 89% decline

— tom renna (@GFNNstock) August 7, 2013

$DST Q2 2013 $201 million operational cash flow, an increase of $134 million vs Q2 2012 . 200% increase

— tom renna (@GFNNstock) August 7, 2013

$MELI Q2 2013 $29 million operational cash flow, a decline of $10 million vs Q2 2012 . 26% decline

— tom renna (@GFNNstock) August 7, 2013

$PDFS Q2 2013 $14 million operational cash flow, an increase of $7.1 million vs Q2 2012 . 103% higher

— tom renna (@GFNNstock) August 7, 2013

$FSLR Q2 2013 $222 million operational cash flow, a decline of $206 million vs Q2 2012 . 48% drop

— tom renna (@GFNNstock) August 7, 2013

34 Stockdiagnostics Upgrades Hit All Time Highs

click to see at EquitiesResearch.com

34 Stockdiagnostics Upgrades hitting all time highs on July 9,2013
(click tickers to see links to Stockdiagnostics charts on date of upgrades)

Company Name	Ticker	Upgrade	Price	7/9/2013	time	% Return
Amazon.com, Inc.	AMZN	10/29/2002	$18.57	$291.53	10yr	1470%
Western Digital Corp	WDC	10/1/2002	$4.84	$66.20	11yr	1273%
Concur Technologies	CNQR	8/18/2004	$9.28	$84.71	9yr	812%
Domino's Pizza, Inc.	DPZ	10/16/2009	$7.85	$62.14	45m	692%
Buffalo Wild Wings	BWLD	3/8/2004	$13.69	$103.65	9yr	657%
Sally Beauty Holdings	SBH	2/10/2009	$4.32	$31.40	53m	627%
Conn's Inc.	CONN	9/11/2011	$8.40	$55.19	34m	557%
MultiMedia Games	MGAM	5/19/2010	$4.65	$29.34	38m	531%
The Ultimate Software G	ULTI	8/16/2006	$21.12	$123.96	7yr	487%
JAZZ Pharmaceuticals	JAZZ	3/17/2010	$12.49	$72.46	40m	480%
Enterprise Products	EPD	8/4/2004	$12.27	$63.77	9yr	450%
Darling International	DAR	8/21/2006	$4.01	$19.88	7yr	396%
Nathan's Famous	NATH	8/17/2009	$13.05	$60.48	47m	363%
Cantel Medical Corp.	CMN	12/17/2007	$9.73	$36.69	5yr	277%
Artic Cat, Inc.	ACAT	8/15/2011	$14.62	$51.47	2yr	252%
Polaris Industries	PII	5/12/2010	$28.24	$98.61	38m	249%
GP Strategies Corp	GPX	8/16/2010	$7.92	$26.89	3yr	240%
Tagra Resources Ptnrs	NGLS	11/17/2009	$15.77	$53.35	44m	238%
PVH Corporation	PVH	12/30/2009	$41.02	$130.86	43m	219%
Monroe Muffler Brakes	MNRO	6/16/2009	$17.14	$50.50	4yr	195%
Caseys General Store	CASY	3/13/2007	$22.50	$64.54	6yr	187%
Tyler Technologies	TYL	8/2/2011	$25.55	$72.25	23m	183%
BE Aerospace	BEAV	5/10/2010	$26.81	$66.30	3yr	147%
Cracker Barrel Old C.S.	CBRL	11/25/2011	$42.19	$100.32	20m	137%
Discovery Communicat	DISCA	8/8/2011	$34.75	$81.91	23m	136%
Acuity Brands	AYI	1/11/2010	$36.96	$85.50	42m	131%
WD-40 Company	WDFC	4/14/2006	$26.82	$57.09	7yr	118%
Nordstroms, Inc.	JWN	6/20/2008	$29.85	$62.67	5yr	110%
O'Reilly Automotive, Inc.	ORLY	3/7/2011	$55.38	$116.49	28m	110%
Brinker International	EAT	11/10/2011	$21.59	$41.73	21m	93%
Macy's Inc.	M	6/9/2011	$26.99	$50.37	25m	87%
Teledyne Technologies	TDY	5/13/2010	$43.41	$80.06	38m	84%
Lowe's Corporation	LOW	4/1/2011	$25.53	$43.81	27m	72%
Snyder-Lance	LNCE	5/10/2011	$18.25	$29.60	2yr	62%
Bed Bath & Beyond	BBBY	1/12/2011	$49.47	$75.58	30m	52%

click for EquitiesResearch.com Newsletter here

Olstein Funds Recommended Reading

At the Olstein Funds'  home page is a link to a recommended reading list of 17 books .

Below I copied the list from the link.
  

•   Security Analysis, Sixth Edition (based on the Classic1940 Edition),by Benjamin Graham and David Dodd. New York: McGraw-Hill, 2008.

• The Intelligent Investor, A Book Of Practical Counsel, Revised Edition, by Benjamin Graham and updated with new commentary by Jason Zweig and preface and appendix by Warren E. Buffett. New York: Collins Business, 2003.

•  Benjamin Graham On Value Investing, Lessons From The Dean Of Wall Street, by Janet Lowe. Chicago: Dearborn Financial Publishing, 1994.

• Value Investing with the Masters, Revealing Interviews with the Masters, by Kirk Kazanjian. New York: New York Institute of Finance, 2002.

• Value Investing: FromGraham to Buffett and Beyond, by Bruce C.N. Greenwald, Judd Kahn, Paul D. Sonkin and Michael van Biema. New York: Wiley, 2001.

• The Little Book of Value Investing, by Christopher H. Browne with a foreword by Roger Lowenstein.New York: Wiley, 2007.

• The Little Book That Beats the Market, by Joel Greenblatt with a foreword by Andrew Tobias.New York: Wiley, 2006.

• The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments, by Pat Dorsey. New York: Wiley, 2008.

•  Buffet: The Making of An American Capitalist, by Roger Lowenstein. New York: Random House, 1995.

• Winning the Loser’s Game; Timeless Strategies for Successful Investing, by Charles D. Ellis. New York: McGraw-Hill, 2002.

• Value Investing, A Balanced Approach, by Martin J.Whitman. New York: Wiley, 1999.

• Expectations Investing:Reading Stock Prices for Better Returns, by Alfred Rappaport and Michael J.Mauboussin. Boston: Harvard Business School Publishing, 2001.

• Quality of Earnings, The Investor’s Guide To How Much Money A Company Is Really Making, by Thornton O’glove with Robert Sobel. New York: The Free Press, 1987.

• Financial Shenanigans: How to Detect Accounting Gimmicks & Fraud in FinancialReports,Second Edition, by Howard M. Schilit. New York: McGraw-Hill,2002.

• Financial Fine Print:Uncovering a Company’s True Value,by Michelle Leder. New York: Wiley, 2003.

• Creative Cash Flow Reporting: Uncovering Sustainable Financial Performance, by Charles W. Mulford and Eugene E. Comiskey. New York: Wiley, 2005.

• Reading Between the Lies, How to Detect Fraud and Avoid Becoming a Victim of WallStreet’s Next Scandal, by Jordan E. Goodman with foreword by RobertA.Olstein.Chicago:Dearborn/KaplanBusiness,2003

13 out 15 February Newsletter Picks In the Money

Newsletter Picks UP 16% vs 10% S&P500 index  in 12 Weeks

February 22,2013 

Equities Research Newsletter (subscription)

 (blue is price as of May 15,2013 close)

Long Picks:
(click ticker to see Stockdiagnostics upgrade charts & history)

FLEX  $5.15     ($7.29)   up 42%
PAY     $18.24  ($23.00)  up 26%
YHOO  $20.83  ($27.34)  up 31%

CRAY  $18.94   ($17.36)  down 8%
ADES  $25.20     ($31.37) up 24%
WWWW  $16.84 ($20.13) up 20%
EGHT  $6.33      ($7.38) up17%
RHT   $51.71    ($54.16) up 5%
OSIS  $55.17    ($63.93) up16%
GM   $26.51    ($32.31) up 22%
DIS   $54.17    ($67.67) up 25%
HSY  $80.30    ($90.32) up13%

Warnings:
ADP  $59.85   ($71.74) minus17%
TITN  $28.67   ($22.96) up 25%
SSYS $67.35 

Disclaimer.
All Newsletters, published by Equities Research, LLC , does not constitute a recommendation by Equities Research, LLC to buy, sell, hold any security, or to follow any particular trading or investment strategy. Also, the information provided should not be construed as an offer, or a solicitation of an offer, to buy or sell securities. An investor's best course of action must be based upon individual circumstances. EquitiesResearch.com shall not be liable for any damages or costs of any type arising out of or in any way connected with your use of The Newsletters, or any of our services.
EquitiesResearch.com, its officers and employees may buy and sell any position in the securities or companies mentioned herein.

Content copyright 2010-2013. Equities Research LLC. All rights reserved




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35 Stockdiagnostics Upgrades Hit All Time Highs on Friday

35 Stockdiagnostics Upgrades

Hitting ALL TIME HIGHS FRIDAY MAY 3,2013

Chart Shows:
Date of Upgrade, Price of Upgrade, May 3,2013 Closing Price, Month or Year since Upgrade, and Performance since Upgrade.

Clicking name of Company
will lead to the Stock's Posts along with Stockdiagnostics Operational Cash FLow and Free Cash Flow Charts at time of Upgrades, along with GFNN News Stories on date of the Upgrades.

Company Name	Ticker	Upgrade Date	UpgradePrice	5/3/2013	Time	% Return
Cerner Corporation	CERN	5/8/2003	$5.31	$96.67	10y	1720%
Western Digital	WDC	10/1/2002	$4.84	$57.15	11y	1081%
Concur Technologi	CNQR	8/18/2004	$9.28	$81.79	9y	781%
Patrick Industries	PATK	4/6/2011	$2.75	$20.85	2y	658%
TJX Companies	TJX	9/17/2001	$6.73	$49.55	12y	636%
j2 Global	JCOM	8/22/2002	$5.62	$41.31	11y	635%
Mercado Lobre, Inc.	MELI	3/4/2009	$15.15	$104.02	4y	587%
NIKE, Inc	NKE	8/27/2002	$9.73	$61.68	11y	563%
NetSuite	N	3/22/2010	$14.59	$89.77	3y	515%
Cooper Companies	COO	3/11/2009	$20.57	$112.00	4y	444%
Western Gas Partners	WES	5/18/2009	$12.92	$59.73	4y	386%
Lions Gate Entertain	LGF	6/3/2011	$6.01	$25.92	2y	331%
Susser Holdings	SUSS	5/24/2011	$13.64	$56.00	25m	311%
AO Smith	AOS	5/11/2009	$19.46	$76.52	4y	293%
Nathan's Famous	NATH	8/17/2009	$13.05	$45.25	45m	247%
Web.com	WWWW	6/17/2009	$5.58	$19.00	4y	241%
Cantel Medical	CMN	12/17/2007	$9.76	$32.45	5y	234%
Cymer	CYMI	8/11/2009	$32.54	$108.83	45m	234%
GOOGLE	GOOG	8/15/2005	$284.00	$845.72	8y	198%
Alliance Data Syst	ADS	3/10/2010	$61.71	$173.95	38m	182%
HomeOwners Choice	HCI	4/5/2012	$12.15	$31.86	13m	162%
Macquarie Infras. Co.	MIC	9/5/2011	$22.60	$58.85	20m	160%
MasterCard Inc.	MA	2/24/2010	$219.91	$553.55	3y	151%
Tyler Technologies	TYL	8/2/2011	$25.55	$64.01	21m	151%
Walt Disney Co.	DIS	2/14/2005	$26.24	$64.80	8y	147%
Cornerstone OnDem	CSOD	11/18/2011	$16.07	$38.52	18m	140%
BE Aerospace	BEAV	5/10/2010	$26.81	$63.64	3y	137%
CostCo Wholesale	COST	12/28/2009	$53.25	$109.75	40m	106%
Northeast Utilities	NU	5/22/2008	$21.91	$45.16	5y	106%
Cracker Barrel OCS	CBRL	11/25/2011	$42.19	$83.65	18m	98%
O'Reilly Automotive	ORLY	3/7/2011	$55.38	$109.89	2y	98%
American Express	AXP	3/9/2010	$37.77	$70.23	38m	86%
Little Fuse	LFUS	5/17/2010	$37.07	$68.66	3y	85%
Brinker International	EAT	11/10/2011	$21.59	$39.33	19m	82%
FEI Company	FEIC	11/8/2011	$41.21	$68.11	18m	65%