GE: The Recent 7% Pullback Is An Opportunity To Increase Positions

GE Logo

It’s difficult to properly describe GE (GE), or for us old timers, the former General Electric Company. What started in 1878 as a pure play electric company, or more specifically, a light bulb company, has gradually evolved over the last 100+ years into what is considered a global conglomerate. But GE is so much more than that. We can’t walk 10 feet without touching or listening to something produced by GE.

Does this mean the stock is a good buy at any price? Absolutely not. A smart investor will still look for short-term pullbacks in the stock to add or increase positions. With the recent 7% pullback and particularly while the S&P 500 has remained flat, the opportunity to invest in GE may be now.

Hewlett-Packard Has Upside But Barron’s Is Too Optimistic

HPQ Logo

Barron’s published an interesting article on Hewlett-Packard (HPQ) this weekend and highlighting the wonderful job Meg Whitman has done to turn the company around. According to Barron’s, the stock has 20% upside over the next year and is selling at a substantial discount to its long-term value and relative to peers.

On several metrics, Barron’s forecast actually looks conservative. But the stock of a company whose revenues are declining even while cash flow is holding steady needs a catalyst. And with earnings expected to increase just 4% in 2014 and 3% in 2015, price appreciation will have to come from multiple expansion. Hewlett Packard does trade at a discount to peers and Barron’s argues that it should trade at a higher multiple. I agree, but think it will take a little bit longer than Barron’s anticipates.

Google: Optimism Is Built Into the Current Price

Google Zipper Logo

It’s not hard to imaging investors being googly eyed over Google (GOOG). The stock is up from about $100 in 2004 to a high of $1228.88 in February. Getting 12 times return on your initial investment over a 10 year period could be a once in a lifetime event. It’s no wonder investors keep trying to figure out not if to buy more Google, but when to buy more Google.

When I saw the chart below I became hopeful that it had pulled back just enough to take another nibble. The RSI indicated that the stock had reached oversold levels. Meanwhile, the price had dropped below the 2 standard deviation Bollinger band and then flattened out. On a technical basis, it looked good.

Slower-Growing Apple is Still a Buy

Apple Logo

Apple (AAPL) is one of the most followed stocks on Seeking Alpha and quite possibly could be the most widely held stock. A peek into the top holdings of most large cap or technology focused mutual funds will most certainly list Apple. It’s not surprising considering Apple has a market cap of $480 billion, the largest company by market capitalization by a good $55 billion. (Exxon Mobil Corp. (XOM) has a market cap of $422 billion)

But just because Apple is held by all of the top mutual funds doesn’t mean individual investors should follow suit. To determine if Apple is still a good buy, or even a hold for that matter, I wanted to evaluate it for myself.