Free Stuff from INO

I'm an INO.com affiliate. You may have noticed some INO widgets on this blog. I've received a few emails from readers, saying that they find INO's services very useful.

INO has been an investing educator for over 15 years.

What does INO offer?

Here's what's for free:

Trend Analysis: Put in a stock symbol, ETF, commodity, etc, and you'll receive analysis in your email inbox.

INO TV: Four free educational investing videos. Here is a sample, having to do with Gold. Here is another: has gold topped out?
Is there a coming energy bust? Is the move in Crude really over?

Learn how to trade stocks in 90 seconds.

In the early 80s, two men were in a debate about how great traders are made. Is it nature or nurture? Are great traders born with a natural intuition for economics, human psychology and self-discipline, or are great traders a product of intense education and practice? Out of this question emerged an experimental trading group called the "Turtles." These people, with little to no trading experience were put through a vigorous training in trend following.

Out of this experimental group, Russell Sands was one of the first trainees. In this INO TV presentation, "I Am A Turtle," Sands shares the lessons and methodologies that his professional trainers taught him.

Free Dow Jones news.

Free Trial

In the past couple of days, INO introduced a new technical tool called MarketClub Alerts. It is designed to catch market moves as they occur instead of after the fact. It lets you track and identify trend patterns of stocks, ETFs, mutual funds, forex, and futures as often as every ten minutes. Alerts can be sent to you via email or to your smart phone. You can also customize your own charts with 23 other technical indicators.

MarketClub Alerts is based on SmartScan, a proprietary technology that scans over 250,000 different symbols every few seconds.

INO is offering a 30 day free trial of this service. It also includes full access to Trend Analysis, mentioned above, as well as a Trader's Blog, which is updated six days a week with market commentary and trading tips. Additionally, MarketClub membership comes with access to Data Central, where you can download historical data on over 250,000 symbols from 21 exchanges, and Trade School, which features online streaming seminars.

Here's a video of Freddie Mac and Fannie Mae charts, showing how Trend Analysis works on MarketClub.

This is not a paid post, but I do stand to gain financially if you end up buying any of INO's services. Please note that while INO may collect personal information such as your name and email address, should you provide it, I do not. INO is a third party whose services I think you might find useful. I am not responsible for their content or relationship with you.


Procter and Gamble, A Case for Going Long

Headquartered in Cincinnati, Ohio, Procter and Gamble (PG) is the largest consumer household products maker in the world. Operating in the non-cyclical sector, the company sells goods that people use daily. Its brands include Charmin, Cover Girl, Crest, Duracell, Gillette, Iams, Ivory, Mr. Clean, Olay, Pantene, and Tide, to name just a few. Twenty four of its brands make over $1 billion in sales annually.

Procter and Gamble has been around since 1837. The firm has paid investors dividends since 1891, and has increased those payments every year for the last 52 years.

As of writing, PG's shares are off about 15.2% from its 52 week high, set in December 2007. While the stock may certainly go lower, now may be a good time for buy and hold investors to start a position or add to one.

First, consider the headwinds the company faces:

1. As raw materials costs continue to rise, gross margins may suffer.

2. Sales growth is slowing in mature markets. Western Europe and US growth rates are both down, according to a Deutsche Bank research note. Estimates for US growth now range from 2 to 3%, while Western Europe is flat.

3. Increased competition and the emerging presence of hard discounters in Westner Europe are slowing sales.

4. Emerging markets, from which PG derives almost 30% of its sales, are experiencing accelerating inflation. This could curb the current 7 to 9% sales growth there. Moreover, most of the growth in developing markets for PG comes from lower margin products.

5. The Duracell brand continues to perform poorly.

6. Competition from firms like Kimberly-Clark, Johnson and Johnson, and L'Oreal always makes for a tough operating environment.

7. The dollar may appreciate against other currencies. This may harm international sales figures.

Now on to the positives.

Procter and Gamble will sell its Folgers Coffee subsidiary to J.M. Smucker. The $2.95 billion all stock deal (it's tax free), expected to close by the end of the third quarter, will give PG shareholders around a 54% stake in the new company. By selling off Folgers, PG is getting rid of a low margin brand and about $350 million in debt.

Analysts speculate that Duracell may be put up for sale at some point in the future if its margins don't improve.

PG's premium brands, like the fast growing Gillette Fusion, are gaining market share. Moreover, Procter and Gamble has so far been able to raise prices, offsetting raw materials costs and slowing sales in developed markets. Further, while growth in developed markets is slowing, it is only at 1%. Emerging market economies are growing at a fast clip and PG is well positioned to benefit.

The company wants to raise operating margins to 24% by 2010. Analysts think this will be difficult to achieve, but 22% margins are quite possible. This would be an improvement over the past five years. During that period, operating margins were roughly 18% on average.

Procter and Gamble also expects to make further productivity gains. The company says it will improve its productivity gains between 7 and 8% annually (up from 6% annually over the last three decades).

If the past is any indication, PG should outperform the market if the market trends down. Over the last quarter century, PG has outperformed the S&P 500 in all five major market downturns.

With a current earnings estimate of $3.87 a share for 2009, the company is trading at just over 16.5 forward earnings. This is on the low end of PG's 15 year forward price/earnings range.

While the company has around $40 billion in total debt, its operating cash flow was $13 billion in 2007. Its return on invested capital has averaged over 20% for the past five years.

The dividend yield is currently around 2.5% and the payout ratio is roughly 41%. The dividend rate will no doubt increase in the future. Procter and Gamble's five year dividend growth rate is almost 11%.

To conclude, PG is a consumer staples giant facing some headwinds, mostly in the form of rising materials costs and slowing growth in mature markets. Price increases, productivity gains, growth in emerging economies, and the divestiture of lower margin product lines should offset these problems.

With billions in sales spread out over a host of consumer nondurables, PG should weather the economic storm relatively unscathed. If the economy gets worse, people will still buy soap, diapers, razors, detergent, and toilet paper. If it gets so bad that consumers cannot afford to buy these products, then investors will have a lot more to worry about than PG's share price going down.

If you are interested in Procter and Gamble, you may also be interested in the Vanguard Consumer Staples ETF, where it is the top holding.

Another way to own PG is to purchase shares directly from the company.

Disclosure: While I do not hold any shares directly, I own PG through BlackRock's Enhanced Equity Yield Fund.

Why the last ethical investing blog carnival?

This is an explanation of why I've decided to end the ethical investing blog carnival.

There were plenty of submissions, but almost all were completely irrelevant. Here were the guidelines:

"Submit your articles on ethical investing. Topics could include, but aren't limited to, discussions of environmentally friendly, people friendly, animal friendly investments; what makes an investment 'ethical,' can it be profitable, what commonly called 'ethical' investments are anything but that, is investing in the so called 'vice' industry necessary unethical, etc.

"However, please DO NOT submit posts that are irrelevant to the carnival. Posts MUST be about investing AND related to ethics."

Submissions consisted mostly of ads for ebooks on trading stocks, Investor's Business Daily stock picks, lists of index funds, articles on which stocks are hot now, how to make money online, and so on.

Since I received the same submissions to my other blog carnival, "Simply Investing" (the next edition will be huge), I can only surmise that the bloggers who submitted irrelevant articles (there are about 20 regulars) send their articles to every single finance related carnival--indiscriminately. The things we do for inbound links and traffic.

Since there were so few legitimate submissions, I've decided it's not worth the trouble to keep running the carnival. Perhaps I didn't promote it enough or in the right places. Or maybe no one has been blogging on the topic.

Instead of asking for submissions, in the future I'll scour the net for interesting ethical investing related articles and link to them. I should have done that from the start.

If you've written something on ethical investing and would like me to link to it, email me.


Ethical Investing Blog Carnival Last Edition

Welcome to the final edition of Slackerwealth's Ethical Investing Carnival.

There were 24 submissions this time around. Here is the one that made the cut.

Dorian Wales presents Free Market Proponents Call for Regulation on Speculative Oil Futures Trading: Define Irony posted at The Personal Financier, saying, "Analysts say speculative oil trading is to blame for gas prices at $4 a gallon. Congress considers regulation and legislation. What happened to market forces of supply and demand?"

The author makes an argument in favor of more regulations. In the process, futures contracts and the invisible hand are explained, and we are treated to a few quotes from Ayn Rand, Jean Jacques Rousseau, and Thomas Hobbes.

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