Qantas: How come nine analysts had ‘buy’ ratings?

Qantas Limited (ASX: QAN) yesterday announced a surprise profit downgrade – well a surprise to many, but not me. As I mentioned a few weeks ago, “Airlines are notoriously bad investments – In aggregate airlines globally lose billions most years.”  The share price subsequently dropped 18.7% to close at $1.155.

What was most surprising to me was that nine out of 13 analysts had a ‘buy’ or ‘strong buy’ rating on the stock before the announcement. How did they get it so wrong? I have several possible explanations for that.

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Is JB HiFi going to do a “Steve Bradbury”?

Steve Bradbury was an Australian short track speed ice skater who won the 1000 metre event at the 2002 Winter Olympics when all of his opponents crashed at the last corner.

He only made the final after finishing third in the quarter finals, when the defending world champion was disqualified from the final. His tactic during the final was to cruise behind his opponents, and hope they crashed, as they would be taking greater risks to try to win, and he reasoned that they could crash. Read more of this post

Where can I get financial data from for free?

As a personal investor, it can be tough to get free financial data on Australian listed companies. In the US in particular, on sites such as Reuters, Google Finance, Yahoo Finance plus many others, you can find loads of information regarding US stocks, including brief analyst forecast information, historical ratios and financial statements. For Australian stocks, it’s much harder, but as I discuss in this blog, you can get data from a variety of sources for free. Read more of this post

Would I buy shares in Warren Buffet’s company – Berkshire Hathaway?

While this might be controversial, there are several issues I see with investing in Berkshire Hathaway (BRK-A, BRK-B), that would stop me from buying shares. While I’m a great admirer of Warren Buffett and Charlie Munger, as an investor, I want to know when and how I will receive a return on my investment. There’s not much point in investing in something, if you can’t envision the end game. At some point as an investor, you either want to be able to sell the investment and make a profit, or you want to receive a return along the way (usually in the form of dividends).

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Austock portfolio versus my model portfolio update (as at 31st March 2012)

Austock portfolio versus model As at the end of March 2012, The model portfolio is beating the Austock portfolio by over 6%, and also beating the ASX 200 Accumulation Index by 1.4%. The Austock portfolio continues to underperform the Accumulation Index by 4.8%.

19 of the stocks in the model portfolio (out of 30 stocks) are beating the accumulation index, while the Austock portfolio has less than half (14 / 30) of its stocks beating the index.

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JB HiFi: Is NOW the time to buy?

JB HiFi Limited’s (ASX: JBH) share price has been pummelled over the last year and is down 40% since 29th March 2011, and currently trading at $11.06.

As my Motley Fool colleague Bruce Jackson mentioned in this article, “You don’t make money looking backwards. Yet so many people do exactly that. They look at the recent past, and extrapolate that deep into the future.”

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Austock portfolio versus my model portfolio update (as at 7th March 2012)

Austock portfolio versus model 7 Mar 2012  As at 7th March 2012, the model portfolio is outperforming both the ASX/S&P 200 Accumulation index and the Austock portfolio. The Austock portfolio continues to under-perform the market – down by 8.92%, compared to the Index at -6.57%. My model portfolio has 17 stocks out of 30 that are beating the index, compared to the Austock portfolio, which only has 14 stocks beating the index.

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