Joy Global (JOYG) has blown through my target price for June 2010 in just two months. Try as I might, I can’t juggle the fundamental numbers to come up a reason to raise that target now, so I’m going to sell these shares out of Jubak’s Picks.
Joy Global did indeed raise its earnings guidance for fiscal year 2009 (which ends in October 2009) when it reported third quarter earnings, but the company also cautioned that fiscal 2010 would be challenging and that 2010 revenue and earnings will be lower than in fiscal 2009.
 Right now Wall Street projects earnings of $4.19 a share for fiscal 2009 and just $2.50 a share for fiscal 2010. I think it’s likely that Joy Global will report a drop in orders in both the fourth quarter of 2009 and the first quarter fiscal 2010. That should give me a chance to get back into the stock before the turn in orders that I project for the second or third quarter of fiscal 2010.
To repeat I like the long-term story for this mining equipment maker–it’s one of the few equipment makers that survived the collapse of its market and can now look forward to decades of growth in the mining industry. It remains a pick in my long-term Jubak Picks 50 portfolio. But in the short-term I think most of the turn in fiscal 2010 is priced into the stock.
I’m selling with a 34.6% gain since I added the shares to Jubak’s Picks on July 21. (Full disclosure: I will sell my shares of Joy Global out of my personal portfolio three days after this post goes up.)
to err is human, to spell is divine…
Mr. J -good luck with this site. Hope you make a bundle with it.
Jim, what do you think would be a decent price to get back in to Joy Global? Also, I would be glad to proof your blog for you !
crd, you’re not being a jerk. I find typos as annoying as the next guy (or maybe more so.) I read everything over as carefully as time permits before I post it and then correct any mistakes I didn’t catch then if I see them later. But frankly I don’t have any more time to sink into proofing At this point in growing the blog any cash I’ve got needs to go into growing the blog. If the blog grows, then at some point I’ll have the cash for a copy editor. Until then I’ll catch as many errors as I can and hope that you’ll bear with me.
I hate to be a jerk, Jim, but you need to get a copy editor. Don’t you have anyone who can read your posts and correct your typing and spelling errors?
sold! for 26% gain