Should You Buy Target (TGT) Stock?

Target InvestigationDear Mr. Market:

With the holiday season now in the rear view mirror U.S. consumers are being reminded of the world we live in.  In the middle of the holiday shopping season Target made an announcement that had an impact on millions of individuals.  On December 19th Target announced that 40 million credit and debit cards had been jeopardized by a cyber attack.  Since then the number of cards has grown to 70 million, it has been reported that the number could grow to as many as 110 million!  Just last week Neiman Marcus released news that it is dealing with a similar situation and other retailers are likely to be in the same boat in the coming weeks.

On Friday (January 10th) Target announced that the security issue had a negative impact on their holiday shopping results.  Stores saw sales decline up to 5% (depending on location) when compared to the previous years results.  When 4th quarter earnings are announced on February 26, 2014, the additional expenses the company has incurred due to the hacking incident will certainly have an impact.  CEO Greg Steinhafel announced that 4th quarter EPS (earnings per share) were lowered to $1.20 – $1.30 from the previous guidance of $1.50 – $1.60.  Continue reading

Force your Portfolio to be Disciplined in 2014

Rebalance Cartoon

Congratulations Mr. Market…you’ve delivered a tremendous year of returns to equity investors!  With the broad equity markets delivering returns over 25% (S&P =29%, DJIA = 25% and the NASDAQ = 37% as of 12/27/2013) investors are now faced with the question of what to do now?  For those investors that were invested in stocks, especially domestic stocks, year-end statements are going to look very impressive but remember that is only on paper. As we step into 2014 what should investors do with their portfolios?

Often investors choose to go with an adage commonly heard in casinos – “Let it ride!” Although the market defied odds and dodged several ominous obstacles, there is no guarantee that it will continue to do so going forward.  Sitting back and doing nothing could very well allow those returns to dwindle away and become nothing but a memory.  It wasn’t that long ago that ‘The Tech Bubble’ hit investors with a strong left uppercut that they never saw coming.  Mr. Market delivered three years of impressive returns (1997 = 33%, 1998 = 28% & 1999 = 21%) only to see it disappear with three consecutive years of negative returns (2000 = -9%, 2001 = -11%, 2002 = -22%) and let’s not forget 2008 (-37%).   How can investors avoid repeating history while also managing the risk and unrealized gains in their portfolio?  Continue reading

Sorry Mutual Fund: You’re Fired!

always done it that wayDear Mr. Market:

It has been said that eight of the most expensive words in the business world are: “Because we have always done it that way!”  How often have we heard these words in our personal or professional life?  Where would we be as a country if we embraced this phrase?  Isn’t it safe to say life as we know it would not be the same if generations before us didn’t challenge the norm and truly “think outside the box”?

For decades Wall Street has fought change and attempted to maintain a shroud of secrecy with investors.  Mr. Market has become very skilled at pushing aside information and research that questions the norm and in many cases proves him completely wrong.  In this article we will look at some facts and figures that simply can’t be argued with or twisted into something that they are not.  If you are an investor who owns any mutual funds you need to read this! Continue reading

Is Jim Cramer Really Your Financial Advisor?

Unknown-8Dear Mr. Market:

Many investors have made fortunes off of you and others have of course lost their shirts. There is another tranche of folks that we want to bring to your attention and that is about the people who have made money regardless of how well they predicted your next move; let’s talk about the entertainers that you keep in business.

Anytime someone has made millions of dollars from investing we’re going to at least listen and try to learn what they’re all about. In the case of Jim Cramer, however, he’s made his money from Continue reading

Independent Review of the Permanent Portfolio Fund (PRPFX)

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Every so often we come across an investment that grabs our attention. In this case we would like to turn the clock back a bit and revisit a time when the sky was falling and “Mr. Market” seemed to have it in for all of us regardless of where you tried to put your money. That was in 2008 and without reliving too many painful memories or details…let’s just simply refresh you on the performance of certain asset classes/indexes that year:

S&P 500   =  -37.00%

Mid Cap  =  -41.46%

Small Cap  =  -33.79%

MSCI EAFE (International)  =  -43.06%

Emerging Markets  =  -53.18%

If you had any Bond exposure in your portfolio that’s probably all that you had to celebrate as they at least turned in a positive +5.24%. Most people realistically didn’t have enough Bond exposure but flocked to them in 2009. They were rewarded with another positive year with +5.93%. The problem with that, however, is that the areas they just cut bait on (stocks) returned the following:

S&P 500 = +26.46%

Mid Cap  =  +40.48%

Small Cap  =  +27.17%

MSCI EAFE (International)  =  +32.45%

Emerging Markets  =  +79.02%

So what’s the solution during market stretches like this? Continue reading

How Did Mr. Market Fill Out his NCAA Bracket?

Dear Mr. Market:

We understand you’re likely quite busy the past couple of days with some of the whip saw action in the markets. Maybe all the debt crisis news with Cyprus has you in a sour mood? Perhaps you haven’t had time to look at your NCAA brackets? What if we asked you to choose Indiana or Intel? Now are you interested?

basketball on cashMarch Madness is here! We’re proud to roll out another year of our spin on March Madness. How does a collegiate basketball tournament that captures the majority of America tie into the investment world? Well, aside from the massive amounts of money and time that gets allocated to this event, there are some connections worth looking at. For the past few years we take this time to pontificate which asset classes and what specific stocks may outperform their respective benchmarks over the next year. We happen to be avid sports and hoops fans but as financial advisors we’re joining both passions to attempt to connect some dots. Continue reading