monthly portfolio (november)

Other than the Fountain of Youth, the most desired investor delight is to find high-yielding stocks in a strong bullish

trend. Nothing lights up a portfolio statement like unrealized gains and received dividends.

Finding the right stocks with an attractive yield can at times challenge even the best of investors. The last thing

anyone wants to do is invest in a stock that is about to lower its dividend. With careful research of industries, payout

ratios, technical analysis and a lot of time reading, you can move the odds more in your favor.

Your best asset as an investor is the knowledge you have in the industry you work in. When choosing between

equities, always pick the one in the industry you best understand. Sticking with what you know may be boring at

times but, remember, when it comes to making money, profits are always exciting.

Company Ticker Current Price Monthly Target Stop Loss Long-Term Target

Teradata TDC 63.00 68.00 58.00 72.00 Discover Financials DFS 41.05 43.45 38.8 45.00 Sherwin Williams SHW 142.66 149.85 136 155.00 Apple AAPL 595 645 549 680 Vertex Pharma VRTX 48.29 50.10 46.60 53.20 Nokia NOK ADR 2.72 2.52 2.93 2.20 Amazon AMZN 233 221 245.5 210 Zynga ZNGA 2.29 2.08 2.51 1.85 Facebook Inc. FB 21.16 19.4 23.05 17.50 Campbell Soup CPB 35.33 33.5 37.2 31.50 Regions Financial RF 6.55 6.93 6.19 7.25 Gap Inc. GPS 35.74 37.65 33.95 38.90 Seagate STX 27.35 28.85 25.93 30.00 Sprint Nextel S 5.57 5.99 5.18 6.25 Gold Corp. G 45.19 47.95 42.59 49.50

Monthly Portfolio

CFB Special Report Date 1st November 2012

REPORT NAME: November Monthly

Portfolio

INSTRUMENT NAME: Various

Monthly Portfolio

1. Teradata (TDC)

Teradata, with a market value of $13 billion, is a 32-year-old IT company

focused on developing and commercializing data warehousing services to

the world's largest 3,000 organizations. It was spun off from NCR Corp. in

2007.

Its shares are up 57% this year and have a three-year, average annual

return of 43%. Analysts give its shares six "buy" ratings, seven "buy/holds,"

and seven "holds," according to a survey of analysts by S&P.

2. Discover Financial Services (DFS)

Discover Financial, with a market value of $19 billion, issues credit cards

and acquires transactions. It operates a closed-loop credit card network

and also uses third parties to issue its cards. The company's sales growth

has averaged about 2% a year over the past 14 years.


return of 47%. In March, the company announced a strategy shift toward

becoming a more full-service direct-payments provider. The trend of

moving from cash and checks to electronic payments, such as credit or

debit cards, is a major tailwind for Discover.

3. Sherwin-Williams Co. (SHW)

Sherwin-Williams, with a market value of $14 billion, makes paints, coatings

and wall coverings worldwide. It is the U.S. market leader, with a 30% share.

Investor takeaway: Its shares are up 59% this year and have a three-year,

average annual return of 34%. Earnings are strong as analysts' consensus is

for $6.36 per share this year, and that they will grow by 19%, to $7.59, next

year.

Current Market Price

$63.00

Target: $68.00

Stop Loss: $58.00


$142.66

Target: $149.85

Stop Loss: $136.00


$41.05

Target: $43.45

Stop Loss: $38.80

Monthly Portfolio

4. Apple (AAPL)

Apple, with a market value of $621 billion, designs and makes consumer

electronic devices, including PCs (Mac), tablets (iPad), phones (iPhone) and

portable music players (iPod). Its iTunes online store is the largest music

distributor in the world; it sells and rents TV shows and movies, and sells

applications for the iPhone and iPad.


return of 60%. S&P has it rated "buy" with an $800 price target, a 23%

premium to the current price. S&P says its projected earnings growth, large cash position, strong free

cash flow generation and relatively high return on equity, continues to make the shares "attractive."

Although the company's recent third-quarter results were below expectations because of an

unexpectedly sharp drop in iPhone shipments, we believe the headwinds are primarily short-term in

nature and product-cycle driven. Long-term, as users become more tethered to Apple's iOS ecosystem

rather than a specific device, integrating additional Apple devices into users' routines becomes

seamless.

5. Vertex Pharmaceuticals (VRTX)

Vertex Pharmaceuticals, with a market value of $12 billion, is a

biopharmaceutical company that uses structure-based drug design to

discover and develop small molecule therapeutics for the treatment of a

wide range of diseases, including hepatitis C and cystic fibrosis.


return of 17.5%.


$595

Target: $645

Stop Loss: $549


$48.29

Target: $50.10

Stop Loss: $46.60

Monthly Portfolio

6. Nokia (NOK ADR)

Nokia battled through $555 million and $1.3 billion declines in operating

cash flow and cash equivalent position, respectively. For the year, Nokia

has lost $2 billion off its cash and cash equivalent line item. If this trajectory

continues, Nokia will declare bankruptcy within the next twenty-four

months, and sell off service, handset, intellectual property, and fixed asset

units at fire sale prices.

To postpone the inevitable, Nokia must eliminate its dividend in

conjunction with debt refinancing. These moves would preserve roughly $1.5 billion in cash flow over

the next 18 months. Financial engineering alone, of course, is never enough to safeguard a flawed

business model over the long term.

At $2.57, Nokia's risk versus reward profile, however, is far from favorable, and conservative investors

should immediately sell off stock.

7. Amazon (AMZN)

We believe that Amazon is overvalued and overrated. We believe that

investors have bid this company up to an unsustainable high of 108X

expected 2013 earnings. We are also especially concerned that it is trading

at 32X TTM operating cash flows and over 100X TTM free cash flows. We

see significant operational and execution risk in Amazon and are

concerned that the recent run of rapid revenue growth has not translated

into increased profits for Amazon. We are concerned with the rapid run-up

in its CapEx and its declining Returns on Investment Capital.

We think that investors are too willing to overlook profit growth in exchange for revenue growth at

Amazon. We believe that investors who have been long-time holders of Amazon may want to consider

steadily reducing their exposure to Amazon and to pay the maximum 15% tax rate on their gains rather

than stick around for a significant potential decline in Amazon's shares. In short, while we are impressed

with the performance of Amazon North America and Amazon Web Services, we believe that the halo

effect from those businesses is blinding investors to the poor performance of Amazon International.


2.72

Target: 2.52

Stop Loss: 2.93


$233

Target: $221

Stop Loss: $245.50

Monthly Portfolio

8. Zynga (ZNGA)

The firm reported better earnings than expected for the third quarter,

impressing investors just a few days after discreet layoffs pushed analysts

to rethink estimates. While the news is good for ZNGA shareholders, it

doesn’t do much to change the firm’s technical outlook right now.

That’s because even though ZNGA is up 11%, shares are still sitting just

below resistance at $2.50. In fact, shares actually managed to hit their

head on that $2.50 price level before reversing lower intraday/ That tells

us that the glut of supply that’s caused $2.50 to act as a price ceiling is still

there.

In spite of today’s gains, we are still calling Zynga a social media stock to sell

9. Facebook (FB)

Typically, Zynga and Facebook (FB) go hand in hand. And lately, that’s

meant that they’ve both been in supremely active stocks in freefall. FB

rallied hard after announcing third-quarter earnings that bested analysts’

expectations. While we don’t think that this stock has turned the corner

fundamentally.

Right now, Facebook looks like it’s making a double bottom pattern in

shares. Price action stays below the $23 resistance level, sending a selling

signal. Even if shares are reversing in the short-term, the primary trend is

still down.

10. Campbell Soup (CPB)

The products from Campbell Soup may be tasty and fulfilling, but the

stock is far from such a description. With stagnant long-term growth and

performance, an uneventful stock chart, and a dividend of unreliable

history, an investor is better suited toward other dividend-paying stocks

with bright futures of growth (such as McDonald's). Campbell Soup

simply does not have enough going for it to be worth investing capital in.


$2.29

Target: $2.08

Stop Loss: $2.51


21.16

Target: 19.40

Stop Loss: 23.05


35.33

Target: 33.50

Stop Loss: 37.20

Monthly Portfolio

11. Regions Financial (RF)

Regions Financial, with a market value of $10 billion, and with $122 billion

in assets, is a financial holding company that operates 1,800 banking

offices in 16 states mostly in the Sunbelt. Its operations include banking,

brokerage and investment services, as well as mortgage banking and

insurance brokerage.


return of 11.5%.

12. Gap Inc. (GPS)

Gap, with a market value of $17 billion, is a specialty apparel retailer

that operates Gap, Banana Republic and Old Navy stores. They sell

casual clothing to moderate, upscale and value-oriented consumers.

The company operates more than 3,000 corporate-owned stores

throughout the U.S., Canada, Western Europe and Japan, and 250

franchise stores internationally.

Its shares are up 107% this year and have a three-year, average

annual return of 39%. Gap posted 10% higher same-store sales and 12% higher total sales.

13. Seagate Technology (STX)

Seagate, with a market value of $15 billion, manufactures hard disk

drives used in computer servers, PCs, laptops and personal-

entertainment players. Of the company's revenue, 65% to 75% comes

from original-equipment manufacturers.


annual return of 46%.


$6.55

Target: $6.93

Stop Loss: $6.19


$35.74

Target: $37.65

Stop Loss: $33.95


$27.35

Target: $28.85

Stop Loss: $25.93

Monthly Portfolio

14. Sprint Nextel (S)

Sprint Nextel, with a market value of $15 billion, is the third-largest

wireless carrier in the U.S., serving 48 million customers directly and

8.4 million via resellers, using two separate nationwide networks.


annual return of 11%.

UBS Securities upgraded it to "buy" from "neutral" at the end of July (the same rating as S&P) after

second-quarter earnings indicated a significant increase in the outlook for EBITDA (earnings before

interest, taxes, depreciation and amortization) and free cash flow over the next three years is

warranted.

15. Goldcorp. (G)

Goldcorp (GG) interns to boost cash flow by sharply boosting production.

The company hopes to boost its gold production 70% over the next four

years, to around 4 million ounces annually. Goldcorp’s costs are bit higher

than Barrick’s -- around $625 per ounce -- but surging volume should still

equate to a steadily rising bottom line.

Goldcorp is also one of the financially stronger players in the industry, with

$1.2 billion in cash at its disposal. That should be enough to complete its

existing capital spending programs and make a series of acquisitions of

smaller gold miners.


$5.57

Target: $5.99

Stop Loss: $5.18


$45.90

Target: $47.95

Stop Loss: $42.59

monthly portfolio (november)

Economy & Finance