Entries for March 2012

Standard & Poor's fourth quarter 2011 preliminary buyback report for the S&P 500 Index shows buybacks declined in Q4 along with reported earnings. Preliminary earnings were reported at $186.76 in Q4 2011 versus $206.08 in Q3 2011 and $187.67 billion in Q4 2010, while buybacks declined to $91.46 billion versus $118.41 billion in the prior quarter.From The Blog of HORAN Capital AdvisorsS&P's Howard Silverblatt, Senior Index Analyst, notes,“Companies appear to have finally gotten it right with aver...  Read more...

In a dividend report released by Factset this past Friday, it is noted the number of dividend paying companies in the S&P 500 Index has reached a 12-year high. The report notes,"The number of dividend-paying companies was 393 at the end of Q4 2011 (January 2012), which marks a 12-year high. Aggregate quarterly dividend payments amounted to $260.8 billion over the trailing twelve months. On a per-share basis, the aggregate figure was $26.78 per share, reflecting year-over-year growth of 16.1%. Th...  Read more...

Recent unemployment data released by the Labor Department continues to indicate the economy is adding 200,000 jobs per month. This has been the case for the last three months. What is interesting about the continued job growth figures is the GDP growth rate is suggesting a much lower rate of job additions. A recent article in the Wall Street Journal, Piecing Together the Job-Picture Puzzle ($), notes the level of job improvement over the last year would indicate the economy is growing at a 4-5% ...  Read more...

Various techniques are available to investors in order to customize an effective approach to reducing a concentrated investment. Investors must continually evaluate the investment landscape, concentrated position risk, opportunity cost, time horizon and taxable consequence related to concentrated holdings. We recently prepared a report titled, Unlocking Concentrated Risk (PDF), that we feel is timely for investors as the market and individual stock prices have increased significantly since the m...  Read more...

The consumer is the one important key to economic growth as they account for nearly 70% of GDP. Recent data does show consumer balance sheets have been improving based on the Fed's Financial Obligation Ratio.From The Blog of HORAN Capital AdvisorsEven consumer loan charge offs at commercial banks continue to show significant improvement.From The Blog of HORAN Capital AdvisorsThe water on the fire though is the fact consumer delinquencies have recently turned higher. Is this a precursor to a less...  Read more...

The Chart of The Day charting service provides a graphic look at the market recovery for various indices since the financial crisis trough in March 2009."For some perspective on the post-financial crisis rally, today's chart illustrates how much of the downturn that occurred as a result of the financial crisis has been retraced by each of the five major stock market indexes. For example, the Dow peaked at 14,164.53 back in October 9, 2007 and troughed at 6,547.05 back on March 9, 2009. The ...  Read more...

The dividend paying stocks in the S&P 500 Index have significantly lagged the performance of their non paying counterparts. The payers return in February and YTD have totaled 3.84% and 8.92% respectively. The non-payers on the other hand have generated February and YTD returns of 5.55% and 14.19% respectively.From The Blog of HORAN Capital AdvisorsSource: Standard & Poor'sOne could say the market has been in a "risk on" mode this year and at least since the end of September last year. As we disc...  Read more...

Mutual fund flow data appears to indicate investors have been late to allocate additional funds to equities in spite of the strong equity market advance since the end of September last year. As the blue bar in the below chart indicates, monthly net flows into equity mutual funds has been negative in spite of the continued advance in the market.From The Blog of HORAN Capital AdvisorsThe below chart shows the same data with flows accumulated on a rolling one year basis. Historically, when equity f...  Read more...