Corporate Profits Might Be Falling, But Don’t Let Yours…

The Oxford Portfolio Update – January 22, 2009 (Broadcast #842)
by Louis Basenese, Oxford Club Senior Analyst

Forget the four-day rally for the S&P 500. Or the fact that it traded above its 50-day moving average yesterday for the first time in weeks. Unless you’re a technician, these feats hold little value.

What matters instead, is what’s going on at the company level. And two headwinds exist that can’t be overlooked.

First, companies keep cutting dividends. At the fastest pace in 50 years, no less, according to Howard Silverblatt, Senior Index Analyst at S&P. Already this year, seven companies in the Standard & Poor’s 500 index have decreased their dividends, wiping out roughly $12 billion in payments investors were banking on.

Second, only 45% of U.S. companies have beat earnings estimates. That’s even more pathetic when you consider how dramatically analysts have cut estimates in advance of announcements. True, earnings season is far from over. But if this trend keeps up, it would be the worst “beat rate” in a decade, according to Bespoke Investment Group.

Yesterday, the Fed whipped out its crystal ball and pegged the second half of 2009 as the turning point for our dismal economy. Banks and securities companies concur, according to a recent survey by Bloomberg.

And if that’s the case, here’s a company that it’s time to load up on…

To continue reading and get all the Oxford Club’s latest updates, subscribe today.

• Under Armour (UA) Gets Penalized by Analysts
• This Company Proves Stocks Aren’t Dead…
• Earnings Reports: 3 Stand-Out Stocks & The Post Earnings Announcement Drift

Sign Up now and receive this Free report: Collect 122% in the Next 12 Months From Gold's Surge.

The Single Best Investment for 2009

Forget another stimulus package. Or retreating into "safe-havens" like cash and gold. All you need in 2009 is a small exposure to the "secret" White Cap Index.

It's up as much as 171% straight through Wall Street's meltdown. And one of the latest stocks to be added - an Internet-related venture capital company - is up over 100% since its inclusion into the Index.

Just weeks from now, we'll add another White Cap stock to this market-trouncing index. To get a sneak peek, click here for full details.

Comments

Check out our selection of daily Investment Research:

We Respect Your Privacy

---

What is Investment U?

Since 1999, Investment U has provided impartial, no-nonsense investment advice on how to build long-lasting wealth.

---

Recent Articles

Platinum Services

The Oxford Club is an exclusive, global network of investors, who collectively participate in the pursuit of prosperity and wealth. The Club is renowned for its market-beating, tried-and-true investment principles.

The White Cap Report exclusively identifies companies, White Caps, which - by being among the earliest to gain traction - have secured dominant positions within untapped, billion-dollar markets.

With an elite trading team at the helm, the Xcelerated Profits Report shows any investor how to "invest like a pro," using high-level, yet easy-to-execute strategies that "xcelerate" profits while minimizing risk.

---