Comments on: For after the correction, think industrial stocks: Market history says this is their time

By: drpearso

drpearso — Wed, 27 Jan 2010 02:29:03 +0000

If Energy is suppose to recover here in the “EARLY RECOVERY” period, would you recommend Exxon as a buy in this ‘Early Reovery’ period.

Exxon has dropped 14% over the last several weeks (from approx Dec 1st until 1/26/20100 … yet the other large integrated Energy companies such as Chevron, BP etc have all gone up since Dec 1st to 1/26/2010.

considering that, would it be a good time to buy into Exxon now???? Thanks the input .. regards

By: francolargo

francolargo — Tue, 26 Jan 2010 20:30:01 +0000

Happy to oblige, Jim! I think you are correct to stay out of ERJ at the moment unless exchange rates are a strong part of the play. [I made money on ERJ with you when it was a pick, BTW!] Bombarier, Sukoi, Mitsubishi, a Chinese firm (don’t recall name), and others will make the regional jet marketplace very challenging for ERJ. The fact that the new ‘larger’ regional jets now seat about 150 people makes them attractive for many routes, but I think that the long view in operating efficiencies must recognize that re-engineered 737s and A320s can have expanded roles if their efficiency is adequately improved. Of course, those projects haven’t been started yet. Still, while passenger levels are depressed now, orders for new planes typically have lead times of several years. Add to that the fact that there are simply too many (old school) single-aisle commercial jets in the world, and the new regional jet market becomes pretty tough to call! Airbus and Boeing have their own space for the larger aircraft, which is a much simpler situation than ERJ’s.

I may be wrong to short BA for tomorrow’s conference call (a low-stakes gamble for fun), but I follow breaking news and there have been a few unanswered questions on the 787 flight test program. they’ll try to gloss over them because the plane reportedly flies well: e.g., the sticky nose gear and the cause of a broken windshield… Plus, the order book for the new 747-8 – mostly ordered for freight service – is not looking strong as many older 747s are being retired from passenger service.

Thanks again, Jim, for all you do!

Frank – Mpls.

By: Jim Jubak

Jim Jubak — Tue, 26 Jan 2010 19:15:35 +0000

Francolargo, thanks for the long take on Boeing (and the reminder on ATI). I’ve also been watching Embraer (ERJ) and the regional jet market.Personally I’ve wound up on a lot of ERJ planes lately in some unexpected markets (NYC to Washington). Looks like flying smaller planes is one way some airlines are planning to deal with the cost crunch.

By: doydum

doydum — Tue, 26 Jan 2010 18:29:05 +0000

EdMcGon:

> eliminate wealth in this country.

Dont worry. This president is not going to eliminate wealth in this country. On the contrary, Obama, like his predecessors, will continue to eliminate the American working class. ‘Liquidate’ better describes the situation just like Mellon who was Herbert Hoover’s Treasury Secretary, who according to Hoover told him to “liquidate the workers, liquidate the farmers, purge the rottenness”.

By: Soonerxii

Soonerxii — Tue, 26 Jan 2010 17:27:42 +0000

I certainly don’t trust any gov number re employment right now. I don’t believe that the Fed is going to actually raise rates until employment is ACTUALLY improving, though they will talk tough about it going forward. What will really happen is massive money printing by any gov that has a press.