Featured Stocks in Action — week of March 4, 2013 (March 8 update)

(Note: This article was reserved for Goodfellow LLC subscribers until January 28, 2017, when I made it available to the general public.)


Northern Trust Corporation (NTRS, $54.70) continues to climb, as financial stocks provide leadership to the market this year.  Earnings per share (EPS) growth projections stand at 14%, 13% and 12% for the next three years, and the dividend yield is 2.19%.  There is some price resistance in the upper $50’s.  Read our report on NTRS.  (03/08/13)

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Honeywell International Inc. (HON, $73.15) broke through short-term resistance this week and continues to climb to all-time highs.  Projected earnings per share (EPS) growth is slow but steady at 10%, 11% and 10% for the next three years.  The current dividend yield is 2.24%.  This stock is appropriate for growth & income investors.  Read our report on Honeywell.  (03/08/13)

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Macy's Inc. 03/07/13two-year chart

Macy’s Inc. 03/07/13
two-year chart

Macy’s Inc. (M, $41.39) reached a high of about $46.70 in April 2007.  After a big drop with the Financial Meltdown of 2008, and a big run-up afterwards, the stock has been bumping up against resistance at $42 for the last year.  We expect the stock to break out past $42 in the near future and establish a new trading range around $42-$46.  We would still be buyers of Macy’s stock at the current price.  Read our recent report on Macy’s.  (03/08/13)

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News Corp. to Start Cable-Sports Channel in August to Rival ESPN  (Bloomberg)

News Corporation (NWSA, $30.25) will start a national cable sports network called Fox Sports 1.  The network will air in August, and will be available to more than 90 million pay-TV homes.

Fox Sports 1 will initially sustain losses, but could become a multi-billion dollar asset in a few years.

Bloomberg reports, “News Corp. has rights to Pac-12 Conference and Big 12 Conference college games and owns at least 20 regional sports networks. The company also has TV rights to soccer’s World Cup in 2018 and 2022.”

We like News Corp. due to its earnings growth, low PE, and upcoming spin-off of its publishing business.  Read our recent report on NWSA.  (03/08/13)

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Time Warner Will Split From Magazine Unit in Third Major Spinoff (Bloomberg)

“Time Warner Inc. will spin off its magazine business later this year, turning the nine-decade-old publisher of TimePeople and Sports Illustrated into a separate publicly held company,” reports Bloomberg today.

Time Warner Inc. (TWX, $56.33) previously spun off Time Warner Cable and AOL in 2009.

The magazine business has 21 publications, and its revenues have been on a multi-year decline.  After the spin-off, Time Warner will focus on its very profitable film and tv businesses.

The stock has had a strong run-up since July 2012.  We still recommend owning TWX shares, and would especially buy shares during any pullback under $50.  Read our recent report on TWX.  (03/07/13)

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As a reminder, we have also discussed News Corporation’s (NWSA, $29.87) upcoming spin-off of its publishing business this year.  News Corp. owns The Wall Street Journal, several major newspapers in the U.K. and Australia, books and magazines.

The remaining Fox Group will focus on entertainment, film and t.v. businesses, including Fox and ESPN enterprises.

The stock is up about 20% year-to-date.  We still like NWSA, and would especially be buyers on any pullback to $28.  Read our February 2013 report on NWSA.  (03/07/13)

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Leggett & Platt (LEG, $31.47) has broken out of a trading range on the upside.  Earnings growth has slowed down, so we’re not recommending the stock right now.  The stock is up 17% since we recommended it on Nov. 5, 2012.  Current shareholders should use increasing stop loss orders to protect profits as the stock continues to rise.  (03/06/13)

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T. Rowe Price Groupsix-month chart 03/05/13

T. Rowe Price Group
six-month chart 03/05/13

T. Rowe Price Group Inc. (TROW, $74.22) looks like it’s getting ready to break out of a trading range again shortly.  It might bounce at $72 before that happens.  Read our recent report.

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Verizon Seeks Full Control of Industry’s Leading Carrier (Bloomberg)

Verizon Communications Inc. (VZ, $47.38) has a joint venture with Vodafone Group PLC (VOD) wherein Verizon owns 55% of Verizon Wireless.

The two companies have been in discussions for possible changes in ownership for several years now.  These talks include Verizon potentially purchasing Vodafone’s stake in Verizon Wireless for about $115 billion, or a complete merger of Vodafone and Verizon.

Verizon Wireless is the most profitable and fastest-growing major wireless carrier in the U.S.

Verizon has projected earnings growth of 20%, 13% and 7% in the next three years, a dividend yield of 4.32%, and an extremely bullish chart that’s showing signs of an immediate breakout on the upside.

We continue to recommend that growth & income investors buy shares in Verizon.  Read our recent report.


Vodafone Group PLC (VOD, $27.03) is a worldwide mobile communications company with annual revenues of $74 billion.

Vodafone has projected earnings per share growth of 4%, 2% and 1% in the next three years, which is quite stagnant.

The stock pays a hefty 5.5% dividend.

Vodafone stock has been in a two-and-a-half-year trading pattern which has recently been edging lower.

We are not recommending that investors own shares in Vodafone Group.  We don’t see any reason to own stocks that are lacking earnings growth.  Current shareholders might trade out of Vodafone here on a short-term high around $27, into a stock with stronger earnings growth, like Verizon.


AT&T (T, $36.40) is another attractive telecom giant, but nowhere near as successful in wireless customer growth as Verizon.

Wall Street projects AT&T to grow earnings per share 9%, 8% and 7% in the next three years.  These are good numbers for a company with over $100 billion in annual revenue, but not nearly as good as Verizon’s earnings growth.

The dividend yield is 4.92%.

The chart is relatively bullish.  The stock broke out of a trading pattern on the upside last week.  There’s resistance at last fall’s high of about $38.50, and more resistance at $40.

We recommend that investors hold their AT&T shares.  Investors who are looking for big dividend growth stocks with low volatility should bypass AT&T and consider owning Verizon Communications.  (03/06/13)

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The following stocks that we cover are at high points in their trading ranges this morning:  Allergan Inc. (AGN), Celgene (CELG), Comcast (CMCSA), Macy’s (M), MasterCard (MA), News Corp. (NWSA), Northern Trust Corp. (NTRS), Valeant Pharmaceuticals (VRX), Walt Disney Co. (DIS), and Whirlpool (WHR).

Allergan Inc. (AGN), Celgene (CELG), News Corp. (NWSA), Valeant Pharmaceuticals (VRX), and Whirlpool (WHR) recently broke out of trading ranges and should continue to climb in the near-term.

MasterCard (MA), Northern Trust Corp. (NTRS) and Walt Disney Co. (DIS) might break out on the upside quickly.

Comcast (CMCSA) and Macy’s (M) are likely to bounce around a bit at their current levels.

Send questions to research@goodfellowllc.com.  (03/05/13)

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We recommended Allergan Inc. (AGN, $110.96) on Dec. 4, and the stock is up 21% so far.  This is an aggressive growth pharmaceutical stock which could continue to climb for quite a while.  Potential investors should read more here.  (03/05/13)

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We wrote about Valeant Pharmaceuticals (VRX, $69.74) on January 21, and the stock price is up 10% and climbing.  Financial & pharmaceutical stocks are our favorite market sectors this year.  It’s time for aggressive growth investors to make a decision on whether to own VRX shares.  Read more here.  (03/05/13)

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We recommended Whirlpool (WHR, $119.07) two days ago, and it rose as high as $120 this morning.  We love WHR because it fits in beautifully with the growth & income stock theme that’s leading the market in 2013.  Try to jump in under $115 per share.  Read more here.  (03/05/13)

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O'Reilly Automotive3-month chart 03/01/13

O’Reilly Automotive
3-month chart 03/01/13

O’Reilly Automotive Inc. (ORLY, $103.21) appears imminently ready to break out of a strong chart pattern.  Long-term growth investors should review our report from Feb. 25 and make a decision on whether to own shares in ORLY.  (03/04/13)

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Time Warner Inc. 03/01/13three-month chart

Time Warner Inc. 03/01/13
three-month chart

Time Warner Inc. (TWX, $54.01) shares are up over $7 since I most recently recommended the stock in Dec., and the shares are up 45%, plus dividends, since I began recommending the stock exactly one year ago at $37.14.  TWX appears in the Goodfellow LLC Growth & Income Stock Portfolio for 2013.  Growth & income investors should consider accumulating TWX shares on their next bounce below $52.  (03/04/13)

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Verizon Communications Inc. (VZ, $47.06) rose to resistance at $47 this morning.  We expect the stock to trade $44-$47 before breaking out on the upside.  Growth & income investors should read our recent report about VZ here.  (03/04/13)

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Cerner Corp. 03/01/13three-month chart

Cerner Corp. 03/01/13
three-month chart

Cerner Corp. (CERN, $89.23) broke out of a trading range yesterday, March 1, and is now climbing into new territory.  I wrote about CERN on January 7.  The current projected earnings growth rate is 17% per year for each of the next three years.

Standard & Poor’s Research (S&P) made this comment about the fourth quarter 2012 earnings report: “Record bookings of $1.02B were outstanding in our view, and beat management’s guidance of $925M-$975M as we believe more healthcare providers are choosing CERN as an alternative to their existing vendors as healthcare technology requirements become more complex.”

It’s time for growth stock investors and aggressive growth investors to review CERN for possible inclusion into their portfolios.  (03/02/13)


Crista Huff


Goodfellow LLC


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