Where September's Stocks Are Headed Next

I wrote six columns in September that included a bullish or bearish stock opinion on:

• Motorola (MOT - commentary - Cramer's Take)
• Yahoo! (YHOO - commentary - Cramer's Take)
• Office Depot (ODP - commentary - Cramer's Take)
• Delta Airlines (DAL - commentary - Cramer's Take)
• Apple (AAPL - commentary - Cramer's Take)
• Adobe (ADBE - commentary - Cramer's Take)

With three months behind those calls, I thought it was a good time to see how they performed and whether any changes in my opinion were warranted. On the whole, the picks are playing out more or less as I expected.

Motorola

On Sept. 10, I wrote that if Motorola could get its free cash flow back up to 2004 levels and grow the cash flow a measly 2% per year from there, MOT shares would be worth nearly $23.

Instead, the cash flow position has continued to deteriorate, contributing to former CEO Ed Zander's recent ouster. The stock is down 7.2% since the article was written, compared to just a 0.5% decline in the S&P 500.

Still, I think the issues at Motorola can be fixed by bringing the costs -- particularly research, development and overhead -- in line with the current revenue generation. Alternatively, activist shareholder Carl Icahn could push to break the company up into smaller pieces that might be acquired for a higher total than the current company is currently able to garner.

Either way, I'm sticking to my guns on Motorola.

Yahoo!

On Sept. 11, I made a bearish call on Yahoo!, saying I didn't believe in the consensus growth estimates and that Yahoo! wasn't generating enough cash flow to make waiting for the recovery worthwhile -- at least not for me.

Things haven't gotten any better since then, and the stock has lost 1.1% -- although that is a slightly better performance than the 1.7% loss in the S&P 500 over the same period.

I remain bearish on Yahoo!.

Office Depot

On Sept. 12, I made a bearish call on Office Depot (ODP - commentary - Cramer's Take), saying "things are likely to get worse before they get better."

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At the time of publication, Trent was long Adobe and had written naked put options against the shares of Office Depot, although positions may change at any time.

William A. Trent, CFA, is a freelance equity analyst based in the New York metro area. He has been an equity analyst since 1996 and is co-author of Understanding and Evaluating Prospectuses, Offering Documents, and Proxy Statements. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Trent appreciates your feedback; click here to send him an email.