The bull market in our turnaround stocks has pushed more names above their price targets. Many (most) of these companies continue to see their fundamentals improve while their valuations still look attractive enough to keep, so we are raising our price targets on six stocks today.
Signet Jewelers (SIG) – from 49 to 65
Volkswagen (VWAGY) – from 24.50 to 30
Conduent (CNDT) – from 6 to 9
BorgWarner (BWA) – from 46 to 57
Baker Hughes (BKR) – from 23 to 26
Berkshire Hathaway (BRK/B) – from 250 to 285.
Many other CTL recommended stocks are either at or just below our price targets. We want to think more about their valuation and fundamentals in the context of volatile but historically low interest rates, enormous government stimulus spending and a likely strong economic re-opening.
Earnings Reports
No companies reported earnings this past week. Next Monday, Volkswagen (VWAGY) is holding a “Power Day 2021” conference, and on Tuesday will release its full-year earnings and host its annual Media Conference and Investor Conference.
On Thursday, Duluth Holdings (DLTH) and Signet Jewelers (SIG) report earnings, both pre-market.
Ratings/Price Target Changes
Signet (SIG) – from 49 to 65
Volkswagen (VWAGY) – from 24.50 to 30
Conduent (CNDT) – from 6 to 9
BorgWarner (BWA) – from 46 to 57
Baker Hughes (BKR) – from 23 to 26
Berkshire Hathaway (BRK/B) – from 250 to 285.
Friday, March 12, 2021 Subscribers-Only Podcast
Covering recent news and analysis for our portfolio companies and other topics relevant to value investors.
Today’s podcast is about 14½ minutes and covers:
- Brief updates on:
- General Motors (GM) – As batteries become strategically important for electric vehicle makers, GM is close to committing to a second battery factory. We discuss some of the reasons behind the strategy.
- General Electric (GE) – Selling its aircraft leasing operation for $30 billion, of which $26 billion is cash. We outline why the stock went down even though this deal is good news.
- Ironwood Pharmaceuticals (IRWD) – Stock rebounds following 25% drop right after we recommended purchase.
- Volkswagen (VWAGY) – Stock surges, maybe on CEO using Twitter?
- Credit Suisse (CS) – Greensill is yet another example of the bank’s dysfunctional culture. A new CEO and incoming chairman should help root out the problems.
- Royal Dutch Shell (RDS/B) – New chairman provides a credibility boost.
- Mosaic (MOS) – ITC ruling is a win for Mosaic and will likely lead to higher domestic phosphate prices.
- Toshiba (TOSYY) – Two proxy advisors provide support for activists’ proposals in advance of the March 18 shareholder meeting.
- Adient (ADNT) – Reached a deal to simplify and consolidate their China operations and receive $1.5 billion in cash.
- Elsewhere in the Market:
- The $1.9 trillion stimulus law is equal to 9% of U.S. GDP and is larger than Canada’s total GDP. Will there be any costs?
Please feel free to share your ideas and suggestions for the podcast with an email to either me at bruce@cabotwealth.com or to our friendly customer support team at support@cabotwealth.com. Due to the time limit we may not be able to cover every topic each week, but we will work to cover as much as possible or respond by email.