Any thoughts? Where's the sector rotation going? Just a thought: the market rebounds 27%, on average, before corporate earnings rebound. If you look for deep value plays, that rebound can be quite a bit bigger. I bought shares today in ERJ. Brazilian supplier of small to mid size jet liners (i.e. fuel efficient). Great company, beaten down due to rising input costs/real. Based on conservative 09 earnings estimates and a historical P/E multiple of 19, I think shares could easily double. Seems to have hit technical resistance as well. Still have my CAL short, so I have a hedge of sorts, if oil keeps demand from airlines lower than expected. Anyhow, aerospace could hold some real value. Might be a good place to rebalance some hot commodities money, if oil/precious metals resume their correction. The market always looks ahead, and the rebound could be enormous.
The Mediterranean? GULF and PMNA seem to be the only ways to play it at the moment, but I like the potential...
Another company I like-LPL...LG displays, South Korean company.... Trades at 4.5 X earnings and 2X cash flow, has insane margins. Another deep value play-it trades at just 1.2X book value...very odd for its sector. A lot of these emerging market companies can really stray from their intrinsic value...more so than most domestic shares. I know, I'm a bit scatter brain. Sometimes just writing down my thinking helps me, and if it helps a fellow ETer get ideas, even better.
Here's Goldman Sachs Water Conference webcast PDF. Could water (infrastructure, waste water management) be the next big thing? 1. http://www.ge.com/files/usa/company/investor/downloads/webcast/webcast_presentation_03262008.pdf 2. http://www.unepfi.org/fileadmin/events/2006/stockholm/Stockholm_DeaneDray.pdf ETFs: PHO, FIW, PIO, and CGW Stocks: VE, PNR, ERII, HOO, ITT, MWA, WTS (more on the 2nd PDF above) Some articles: http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/05/ccwater105.xml Note - VE's Price/Free Cash Flow is around 100 and Debt/Equity ratio is about 2 .... not good during credit crisis.
Electricity has to be generated, coal will be viable for a long time,boring as it may be. http://www.latimes.com/news/printedition/asection/la-fg-coal20-2008jul20,0,5961612.story
Good post luckylee. I'm long VE (high 51's) and WTR (high 15's). Will continue to add to these positions as well as buy PHO and AWK on any correction.
I'm still long Oil, Oil&Gas Services, Materials (Steel, Mining). Underweight Tech. Short REITs, Financials, Casinos, Telcos, Media/TV.