Monday, September 28, 2009

Favorites Hartford Financial and Terex Close at Recent Highs

Hartford Financial (HIG) is now the top position in our Growth portfolio and Terex (TEX) is a long term holding. Both companies closed today at highs not seen since the market blewup late last year. Being that they both broke thru closing highers from the last couple of weeks, they are likely to surge even higher.

HIG: with 2010 estimates now approaching $4, HIG is likely to surpass a 10 PE sooner rather then later. I'd place at least a $50 target on this stock as the SP500 stays above the 1,000 level. So the closing price above $28.5 is still only a 7 PE.

TEX: this construction company is more difficult to value with some analysts placing the trough sales not until 2011. TEX once traded close to $100 so it seems unlikely that a price just jumping above $20 would be anywhere near a top. The way China and India have returned to growth and the demand for housing in Brazil is seems overly pessimistic that demand won't pick up much sooner then expected. MTW has also broken out and is another more speculative play.

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