April 23, 2013 Comments

It was certainly a pleasant surprise to see Toll Brothers up over 9% today to $34.13. Yesterday morning it had been under $30 briefly. It seems for a day at least the market shared my enthusiasm for the company. Apparently this move was due to an “upgrade” from Barclay’s and perhaps others. That’s a bit scary. It prefer stocks to go up based on earnings rather than based on an upgrade.

The Dow was up just over 1% today.

Wal-Mart was up1.4% today to tie its recent highs at just over $79. For several years I had explained that while Wal-Mart’s stock had not done well since its peak of $60 back in late 1999 that was simply not Wal-Mart’s fault. The market had stupidly bid Wal-Mart way too high back then. The stock then fell to the $50 range and it has taken years of steady earnings growth that has now allowed the stock to set new highs. We rated it (higher) Buy in 2010 and (higher) Buy to start 2011 at $54. And also (higher) Buy at about $60 to start 2012. It was mentioned many times over that period as worthy of consideration. Many analysts considered Wal-Mart to be dead money. It seems they were dead wrong. I recently sold my Walmart to buy more Toll Brothers and to raise cash.


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