General

General

@DavidWisniewski001
• 2 months ago

Starting Valuations

So, I listed a boat load of companies we looked through their balance sheets, income statements, and cash flows.

Through that I was able to determine what areas I want to focus in on and which areas I will stay away from. Right now I believe tech and AI are hot stocks and may have some more potential to run out.

My current thesis: Focus on businesses that have customers that are locked into their business model when they sign up.

Industrial Automation (Pass)

  • Investigated Rockwell and Industrial Automation Firms ( In the US Economy these firms look overweight and bloated)

  • Eaton (Dropped)

  • Lincoln Electric (Dropped)

Company Supplies (Very Interesting Prospects)

  • Figs who makes and supplies uniforms to hospitals is seeing an uptick in imports

  • Cintas and Unifirst seem to be on diverging paths. Worth investigating further

  • Clorox Co Every Bathroom needs to be cleaned right?

Networking/Connectivity (Potentially Over Valued But warrants further investigation)

  • Broadcom who supplies the chips seems to have a very strong position in the market with their software arm

  • Nokia is a rising potential challenger

  • CloudFlare I had higher hopes for

ERP Systems (Meh Energy here but I believe there needs to be more to the puzzle)

  • SAP SE Did not pique my interest on my initial read through but I believe this area has good potential.

Moving Forward I am going to pass on the Industrial Automation Sector. As I believe current economic has lead this area to be overvalued via investor tourism and maybe a little bit of market hype.

Next up would be the companies that supply goods and services to other corporations. This is a very attractive sector due to it being diversified. 1 Steel Mill closing will not put Cintas or Unifirst out of business but they can tap into the success of other sectors. Brands like Clorox have this same ability to be strangely cross sector.

Lastly, There is Networking/Connectivity and ERP systems. Currently, I believe these businesses are riding the AI boom cycle but this is the area I will look if a market correction takes place.

Broadcom has 2 things that make it stand out a proven track record and a software arm.

Nokia has just purchased a company that is a leader in this field combined with its cameras I believe this company was forced to become lean after it fumbled its market position in the cell phone market.

With that being said there are more interesting things playing out that I was unaware of such as pension funds being on the hook to payout every month. I also have already completed my analysis of the health sector prior to my arrival here. I will be circling back around to that from that analysis. I set a purchase price for $UNH that was carried out to completion when the stock tanked. I also purchased pfizer.

Happy Presidents Day. :)