Thursday, December 07, 2006

Looking at AOS

Lately, with the markets on an uptrend, it has been more difficult to find "value" stocks.
At this time, AOS (A. O. Smith Corp.) comes close to attractive for the near future.
AOS manufactures electric motors and water systems for use in various residential, commercial and industrial applications.
Along with my previous choices, it is directly affected by interest rates and the building industry. I see a pattern here, and if I am right, there is a possibility of good returns in the next year or so.
The stock is trading today at 36.06, with short term support at about 34. Low debt, decent volume, good fund ownership, a fair dividend (1.9%); in addition, good earnings expected for '06 and '07, make this company worth considering.

5 comments:

  1. Are you single?

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  2. Hi Ernie,

    Just a quick question, not knowing much about stocks, do you have advise for someone holding mutual funds that have gone up the roof in this market????


    lovela

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  3. Yes "anonymous" I am single, however, I can't find the relevance of your question since this is not a dating or matchmaking site... are you single? (LOL)

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  4. lovela,
    The markets are a bit high for comfort. I would not be amazed if we see a correction (temporary but significant downturn) in the next two months. Nothing goes up forever.
    Depending on the holdings and sectors of the mutual funds, I may consider at this time taking some profits. I would not necesarily sell all of it, just secure some realized gains.

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  5. Thank you. Based on previous experience, that is what I have done in the past, however at this time I was thinking of waiting till nex year to do it. These MF are going to possibly go towards the purchase of a home next year so any significant loss would affect my decision greatly...

    lovela

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