Amijag Investment Fund, LP

Follow us on facebook for more research reports & timely live updates!

United Health Group (UNH)

Current Price: $56.28 (1/29/13)

Dividend: $0.85

Current Outlook: Positive

Future Outlook: Extreemly Positive

Rating: Strong Buy

Intrinsic Value: $69

Holding Buy Price Target: $52 – $54

Book Value: $30.50

Recommended Trading Strategy:

Buy long UNH shares in blocks of 100 & go short out of the money 2014/2015 calls with a premium of $5 – $7. Along with current dividend income & above average option premium these shares should generate plausible returns.

Assumed growth rates based on historical data & future perspectives:

Sales Growth: 14% for 3 Years & 5% beyond)

Earnings Growth: 11%

Dividend Growth: 7%

Notes & History:

Follow us on facebook for more research reports & timely live updates!

Apple (NYSE – AAPL)

Current Price: $586.10 (11/05/12)

Dividend: $10.60

Current Outlook: Extreemly Positive

Future Outlook: Positive

Rating: Strong Buy

Intrinsic Value: $475

Holding Buy Price Target: $555 – $580

Book Value: $128.60

Recommended Trading Strategy:

Buy Apple (AAPL), Research in Motion (RIMM) & Nokia (NOK). Apple has big trading bands & if you have 100 shares then selling covered options is the best way to play this one.

Assumed growth rates based on historical data & future perspectives:

Sales Growth: 20-25% (3 Years & 8-12% beyond)

Earnings Growth: 15-20%

Dividend Growth: 10%

Notes & History:

Apple Inc has a very unpredictable business model. Given the latest fiascos of  Apple maps, release of 4 apple products in a 2 month time period & departure of two high ranking executives adds to the worries. But in spite of all the negativity around Apple it sure does have a competitive advantage. Today Apple is like Michael Jackson they can do anything & still they make money. Just like Jackson’s personal life was a disaster & he ended up with ridiculous amounts of debt, I won’t be surprised if Apple has a similar fate in next decade. But let’s focus on today & how we can cash in on this Apple wave.

Let’s analyze the personal computer business & competition. Computer’s have become a life blood of modern world & I can’t imagine how will people work if these disappear. This puts computers as a 50-60% on the necessity index. Apple started out with a nice little fancy box & never got a bigger pie as it catered to a niche market. But, Apple is breaking the box & they decided to compete in the day to day PC computer business by making cheaper ibox’s. Due to this price war HP computers has shrinked its computer & printer business, Thinkpad was sold to Lenovo a Chinese company, Dell is trying to recover from the disaster & Sony has been beaten down on all fronts since the nuclear crisis in Japan. We’ve seen a steady market share growth in Apple computer’s PC business but its taking over a dying industry & I won’t be surprised if the ball stops in Apple’s court as ibox’s are getting as low as Gateway & new brand names. For present this mean’s good news as Apple can advertise growing market share & become the fool’s leader! News like these move shares as people want monopoly & have a perception that monopoly makes more money than a free market when the other way is the fact.

Apple is an undisputed king in the ipod kind mp3 players & ipad’s then what was the need to compete against its own products. When all other manufacturers are pulling out allowing Apple to continue charging exorbitant prices what’s the need for a new version in less than a year? On top of that they come out with Mac book mini, why Apple why? What’s more important to make money or have a list of 100 products? If you go back to 1990′s – 2000 when Apple was almost belly up the main catalyst for their failure was a vast product line which Steve Jobs cleaned up. Looks like Apple’s executives haven’t learned from past. Anyways for the next 3 years this means steady revenue growth & positive market sentinement’s.

Lastly, the iphone & its competition. Iphone is the main reason Apple is Apple. Until 2011 you were an Iphone, Blackberry or an Android fan but in 2012 & for the near future its Iphone world v/s non Iphone users. Phone companies have earned more in past 5 years from data plans than they had projected for next 20 years. I won’t be surprised to see 6G & 7G in few years. Blackberry (RIMM) has been trying to find a suitor to marry, Nokia‘s trying to find a live in partner who would keep them (Microsoft MSFT has been supporting it indirectly) & Samsung has been bold & stealing Apple’s every new move. Basically, I see the future of Apple’s iphone being available in every store just like you can buy a nokia or a samsung. It may take a few years (3-5) or until Iphone 7 comes out. Until then I see Apple’s earning crossing $100/share.

DISCLAIMER: All of the above forward looking statements have been based off my research from different sources and publicly available information or are my personal opinions. Please do your due diligence before following these reports & these should only be used as a substitute to your research. I may have a position in the above security or may open one in the next 24 hours.

For Personal Use Only!

Follow us on facebook for more research reports & timely live updates!

Advance Auto Parts (NYSE – AAP)

Current Price: $80.10 (11/05/12)

Dividend: $0.24

Current Outlook: Average

Future Outlook: Extreemly Positive

Rating: Strong Buy

Intrinsic Value: $65

Holding Buy Price Target: $65 – $68

Book Value: $12.96

Recommended Trading Strategy:

Buy & hold for long term investment

Assumed growth rates based on historical data & future perspectives:

Sales Growth: 9-11%

Earnings Growth: 10-12%

Dividend Growth: 0%

Notes & History:

Well a good research in my opinion is approaching any business with a Top down approach. Lets start with Macro Economic factors which helps auto parts industry. On an average every car is in a prime age for repair between 6-10 years. Since Obama new incentive program eliminated every used car on road before 2002 by implementing the Cash for Clunker program back in 2009 majority of the low maintenance cars are off the streets. So if you purchased a new car between 2006-2008 which was an era when money was freely flowing & everyone was making money. New car industry had a significant boom as well. Dealers weren’t able to keep up with orders & inventory turnover was its highest level in decades.

Now let’s observe the micro factors as the economy crashed new cars were repossed & luxury was a true luxury again. This leads to an improved demand for quality used cars & all the cars from from the 2006-2008 are the best sellers in todays market. These cars are approaching a 4-6 years life span. As I mentioned earlier 6-10 years is the prime age & maintenance on these cars costs an arm & leg. I believe the used parts industry will have a major boom from 2013 – 2017 & average same store sales will rise as well.

Auto parts industry is pretty fragmented & there is tremendous expansion opportunity  domestically as well as globally. AAP or any company in this industry does not have potentional for extravagant returns but sure does have potential of returning annualized compounded returns on 10 – 17% over 5 year period.

DISCLAIMER: All of the above forward looking statements have been based off my research from different sources and publicly available information or are my personal opinions. Please do your due diligence before following these reports & these should only be used as a substitute to your research. I may have a position in the above security or may open one in the next 24 hours.

For Personal Use Only!

************************ RESEARCH REPORT **************************

Follow us on facebook for more research reports & timely live updates!

Six Flags Corporation (NYSE – SIX)

Current Price: $36.53 (7/13/11) [ADJUSTED FOR 6/28/11 STOCK SPLIT]
Dividend: $0.12

Current Outlook: Positive
Future Outlook: Extreemly Positive

Rating: Strong Buy
Intrinsic Value: $25

1 Year Price Target: $40
3 Year Price Target: $85 – $105
Dividend/Share: $0.12

Holding Buy Price Target: $28 – $30

Current Share Price: $75.41 (5/6/2011)

Current Outlook: Positive
3 Year Outlook: Extreemly Positive

Book Value (5/6/11): $15.50

EPS (2010): $ 11.26 (This was due to company capitalization as part of a bankrupty reorganization plan)
EPS (2011E): $ 0.80
EPS (2012E): $ 2
EPS (2013E): $ 3.5

Recommended Trading Strategy:

Buy SIX Stock around $30 & hold

Assumed growth rates based on historical data & future perspectives:
Sales Growth: 7%
Earnings Growth: 11%
Dividend Growth: 25%

Notes & History:

Every one of us has visited a Six Flag Theme Park or one owned directly or indirectly by them at some point in our life. Then how did a business which was rivalled by Disney & Universal Studios reach such low heights of bankruptcy?

Well a good research in my opinion is understanding what was right, what went wrong & is fixing it going to work? To understand my research report you have to understand the history & growth of Theme Park Business in America.

Six Flags began its empire from Dallas, Texas with opening its first park in 1960 & two more until 1971. Six Flags changed a lot of hands between 1960 & 1998 where the corporation acquired 6 more theme parks from various new owners.

In 1998 Premier Parks purchased Six flags for $1.86 billion from Time Warner & began a wild expansion ride with as many as 48 theme parks in operation under Six Flags banner by 2004. Along with expansion came a huge debt load which parks cash flow couldn’t meet. In 2005 began a downward spiral with comapany’s largest owners (11.5% & 12%) demanding change & proxy battle began for the board. Now Six flags has to liquidate assets to freeup cash flow to survive. With sale of Astroworld, Houston came a wave of negative publicity in Texas & less than 1/3rd value fetched for the land.

Then came management change & they repeated the mistake of earlier management as credit had dried up for the company & stock prices were tumbling. Finally its stock reached $0.29 thats when I started following six flags & debating weather I should buy their junk bonds which were trading at 6 cents on par value. It indeed go into bankruptcy in April 2008 giving control of 84% company to bondholders who extinguished $1.16 billion off their books & gave an additional $860 million loan as working capital for the parks to get bailed out. Between 2005 & 2010 Six Flags dropped from 48 parks to 18 parks.

Present Day:

Company has revamped its marketing, lowered rates, added amazing adventures & from experts in the entertainment industry they are well ahead of the best days Six Flags Corporation has ever seen in its 50 year history. This year is a golden jubilee for Six Flags corporation & I believe if management stayed focus & expanded from its free cash flow this business can reach new heights unheard of with potential for expansion internationally too as it is “THE” only big brand for South America.

DISCLAIMER:
All of the above forward looking statements have been based off my research from different sources and publicly available information or are my personal opinions. Please do your due diligence before following these reports & these should only be used as a substitute to your research.

For Personal Use Only!

Anadarko Petroleum (APC) is rumored to be bought out by BHP Bhillton (BHP)

About Anadarko Petroleum:

Anadarko Petroleum Corporation (Anadarko) is an independent oil and gas exploration and production company, with 2.3 billion barrels of oil equivalent of proved reserves as of December 31, 2009. The Company operates in three operating segments: Oil and gas exploration and production, Midstream and Marketing. Oil and gas exploration and production segment explores for and produces natural gas, crude oil, condensate and natural gas liquids (NGLs). Midstream segment provides gathering, processing, treating and transportation services to Anadarko and third-party oil and gas producers. The Company owns and operates natural-gas gathering, processing, treating and transportation systems in the United States. Marketing segment sells much of Anadarko’s production, as well as hydrocarbons purchased from third parties. During the year ended December 31, 2009, Anadarko divested certain oil and gas properties, primarily in Qatar, onshore United States and other international properties.

********* RESEARCH REPORT *********

Anadarko Petroleum Corporation (NYSE – APC)

Current Price: $75.59

Dividend: $0.09 (0.48%)

Future Outlook: Extremly Positive

Current Outlook: Extremely Positive

Earnings Per Share

EPS(07) :$8.05
EPS(08) :$6.84

EPS (09) : – $0.28
EPS (10E) : $1.80
EPS (11E) : $2.20

EPS (12-15E): $6

Projected Target Share Price:

1 Year (E) : $76
2 Years (E): $95
3-5 Years (E) : $125 – $150

Notes: Anadarko had 25% stake in BP rig that spilled 4 million gallons of oil. So far its bill has been $1.2 billion & markets have factored in $10 billion of approximate liability. If Anadarko were to pay $10 billion tomorrow its intrinsic value will be $45.

There have been rumors that BHP Bhillton (NYSE – BHP) which is an Australian mining giant is going to come out with $90/ share cash offer. I personally believe this is a very likely possibility. I would like to take you through BHP timeline under its new CEO.

May 31, 2007: Marius Kloppers is elected as BHP CEO and his biography on the firm’s website said, however, he played a “central role” in the merger in 2001 of BHP and Billiton that created the world’s largest mining group.

November 8, 2007: Mr Kloppers launches a takeover bid for rival Rio Tinto (RIO) for $140 billion which would have been worlds second largest takeover. He didn’t realize the Jewish hedge funds holding strength on this giant after wasting BHP’s $450 million in legal cost & over a year haggling with Rio Tinto trying every possible tactic to convince boards around the world & even raising its bid to $150 billion he gave up in November of 2008 after the big crash when the combined companies would have been a mere $63 billion. Both companies shed 2/3rd of its value in drop & after BHP left pursuing Rio it dropped by another 20%. This is when I invested in Rio & have been a fan of Rio since then & didn’t know this history back then.

June, 2009 Rio Tinto is cash stripped & is under intense pressure from shareholders, banks & financial rating agencies to pay down its $40 billion credit line it took in 2007 to buyout Alcan & become worlds larges Aluminium manufacturer. Unfortunately recession kicked in & Aluminium prices dropped from $1.30 to $0.40 making Alcan value at mere interest cost with over 80% loss in asset value. Rio sold a few stakes but with recession no one had the cash to buy billions of assets neither did banks have leverage to fund major deals. Again Mr Kloppers steps in with $116 billion iron ore joint venture this was a win win for both rivals. Unfortunately, government regulators globally didn’t approve of this monopoly & after 16 months it was just abandoned. But it was the best thing for Rio Tinto as its stock quadrupled while BHP just doubled inspite of being in a better financial condition & sitting on over $15 billion in cash for 3 years.

August 17, 2010 After third failed attempt at getting publicity & being down in history books Mr Kloppers decides to fight Canadians (doesn’t he travel internationally Canada is the most reserve country when it comes to opening their borders for sale & after then Arcelor Mittal - Dofasco debacle they haven’t let any foreign giant enter their soil to buyout their national heritage, period!). Mr Kloppers underestimated Canadian holding power which bids up Potash by 30% as for Canadiens Potash is synonymous with Saskatchewan province & major source of employment or revenue in that barren land. If you were to ever take the train ride through these provinces & speak to locals en route you would know what this means. You can’t put a price on this & would be a political suicide for prime minister Harper & his conservative party.

December 30, 2010 Rumors surface from British tabloid that BHP is eyeing Adarako at $90 per share cash offer. After studying this timeline in detail for 9 hours & going through every number in detail I believe finally Mr Klopper might have his way to go down in history if he goes behind Anadarko. American banks were supporting Potash to breakout from BHP & Americans know it better that we might not find a better cash cow than BHP to milk for gulf oil spill. This leak is going to put pressure on BHP to expedite its decision either ways & after the positive reactions to this news globally from bonds, stocks to default swaps. I don’t see any hurdles either from shareholders as 87% of Anadarko is owned by hedge funds & you cannot see the kind of movement we saw today without support from majority hedge funds. I think a $100 – $110 closing deal is more likely & BHP can also make a deal with US lawmakers to lock in their liability before buying Anadarko.  Mr Kloopers will have to be more patient & not be himself if he wants a win win situation otherwise it might loose 50% of Anadarko in gulf liability.

Bottom Line:

Strong Buy Call options for $75 / $80 strike price & Feb 2011 exercise date! 

DISCLAIMER:

The assembled, opinions & views distributed by Amijag Holdings is for information/education purposes only, and is neither a solicitation to buy nor an offer to sell securities. Amijag Holdings does expect that investors will buy and sell securities based on opinions & information assembled and presented herein. Amijag Holdings will not be responsible in any way for or accept any liability for any losses arising from an investor’s reliance on or use of information obtained from our website or emails. PLEASE always do your own due diligence, and consult your financial advisor.

For Educational use Only!

Author: Pratik Shah all rights reserved

********* RESEARCH REPORT *********

CHEVRON (NYSE – CVX)

Current Price: $82.64
Dividend: $2.88 (3.43%)

Future Outlook: Extreemly Positive

Rating: Strong Buy
Intrinsic Value: $143

Earnings Per Share
EPS (09) : $5.24
EPS (10E) : $9.45
EPS (11E) : $10.00
EPS (12E): $10.72
EPS (13E – 15E): $11.45 – $13.00

Projected Target Share Price:

1 Year (E) : $96
2 Years (E): $117
3-5 Yrs (E) : $135 – $160

Recommended Trading Strategy:

Buy January 20 2012 Call Option With a Strike of $80 for $8.00

Assumed growth rates based on historical data & future perspectives:
Sales Growth: 13%
Earnings Growth: 7%

DISCLAIMER:
All of the above forward looking statements have been based off my research from different sources and publicly available information or are my personal opinions. Please do your due diligence before following these reports & these should only be used as a substitute to your research.

For Personal Use Only!

********* RESEARCH REPORT *********

TELEFONICA (NYSE – TEF)

Current Price: $81.14
Dividend: $5.05 (6.23%)

Future Outlook: Extreemly Positive

Rating: Strong Buy
Intrinsic Value: $82

Earnings Per Share
EPS (09) : $7.35
EPS (10E) : $7.98
EPS (11E) : $8.17
EPS (12E): $8.95
EPS (13E – 15E): $11.00 – $11.70

Projected Target Share Price:

1 Year (E) : $98
2 Years (E): $118
3-5 Yrs (E) : $135 – $180

Recommended Trading Strategy:

Buy TEF Stock around $75 – $78

Assumed growth rates based on historical data & future perspectives:
Sales Growth: 3%
Earnings Growth: 8%
Dividend Growth: 12%

Notes:

This stock is a great value play & is hedged directly to EUR-USD hence can be in green when rest of the market is red & vice versa. Dividend of 6% on a mammoth this size is very attractive at current valuations. History says stocks around $80 don’t take very long to cross $150 again do your due diligence.

DISCLAIMER:
All of the above forward looking statements have been based off my research from different sources and publicly available information or are my personal opinions. Please do your due diligence before following these reports & these should only be used as a substitute to your research.

For Personal Use Only!