The Market

• I have waited for a while for the first post because the market could not make up its mind.
• It may still not be able to.
• As the Dow switches from red to green and back again so, too, does my feelings about ultimate direction.  We sure do not want the day to end red.  Two down days in a row, especially like yesterday’s, would not be healthy.  On the positive side, if it gains strength and makes an assault on 800 then we are rarefied territory.
• The S&P is solidly over the problematic area of 745 (763 as I type) and should really stay over 745.
• This morning J&J complained that some of it’s proprietary consumer products were being picked-off by companies duplicating them.  Then selling them at lower retail prices.  Could J&J be referring to Perrigo (PRGO)?  I have owned this for a while as I, too, have searched for lower priced “house brands”.  Take a moment and read the Yahoo Finance description of Perrigo’s products.

• “Perrigo Company, through its subsidiaries, develops, manufactures, and distributes over-the-counter (OTC) and prescription (Rx) pharmaceuticals, nutritional products, active pharmaceutical ingredients (API), and consumer products worldwide. The company operates through three segments: Consumer Healthcare, Rx Pharmaceuticals, and API. The Consumer Healthcare segment offers OTC pharmaceutical and nutritional products, which include analgesic, cough/cold/allergy/sinus, gastrointestinal, smoking cessation, first aid, and vitamin and nutritional supplement products. The Rx Pharmaceuticals segment develops, manufactures, and markets topical generic prescription drug products, including creams, ointments, lotions, gels, shampoos, suppositories, liquid suspensions, and solutions, as well as nasal sprays, oral liquids, and transdermal products. The API segment engages in the development, manufacture, and marketing of APIs used by the generic drug industry and branded pharmaceutical companies. Perrigo Company also provides consumer products, such as cosmetics, toiletries, bar soaps, and detergents; manufactures and markets branded prescription drugs; and imports pharmaceutical, diagnostics, and other medical products. Its customers primarily include retail drug, supermarket, wholesalers, and mass merchandise chains. The company was founded in 1887 and is based in Allegan, Michigan.”
• In ’07 Perrigo earned $1.58/share for year ending June ’08 on revenues of $1.5 billion.  Estimates for June ’09 are $1.78/share on revenues of $1.97.  Estimates for June ’10 are $1.96/share.
• Shares are trading at a PEG (p/e to Growth) ratio of .60, a very small number.
• I will dig a little deeper into the story and may add as confidence improves.

Sidebar

I received my renewal notice from Barron’s Magazine.  It offers one year for $159 and two years for $265.  Funny, Barron’s web site is offering a rate of $99 a year. Are they nuts?