JBL: The Strong Survive

The good news is Americans hate treadmills. Americans like being able to take a pill to be healthier. Viagra ushered in the new lifestyle drug era. With an aging population, this is potentially a terrific era for the pharmaceutical companies.

Pfizer still has a decent pipeline and plenty of cash to fund an already massive research and development effort. Pfizer believes using this cash to increase advertising will help sales as well.

Pfizer has 10 drugs with more tha $1 billion in sales. Pfizer has potential blockbusters in several newer drugs, including another cholesterol drug (torcetrapib) and an insulin inhalant (exubra).

With a dividend yield over 3%, the worst news behind it and potential blockbuster drugs emerging, this is a chance to get a great company on sale.

I have owned Pfizer for some time, and earlier this year added to my position. Do I wish I'd bought in the low $20s vs. the high $20s? Absolutely. But I sure wouldn't be a seller here.

Sam's Store

Wal-Mart (WMT Quote) is the same price as it was in 1999, yet earnings have doubled. Sam Walton's firm has rarely ever traded at a discount to the market as it does now. With a forward price-to-earnings ratio just above 15, Wal-Mart's stock is a screaming buy.

Sam Walton had a vision and he achieved it in spades.

Wal-Mart is the world's largest retailer, with almost $300 billion in annual sales. Mr. Walton cannibalized a lot of mom-and-pop stores by offering a better service and everyday low prices. Wal-Mart is No. 1 one in general merchandise and food and beverage. The retailer is No. 3 in the pharmacy sector.

Despite some obstacles, Wal-Mart still has been able to grow domestically. But overseas is where the company has a tremendous opportunity. Wal-Mart has set a long-term goal of deriving 33% of its earnings from international operations. On the opening day of a Wal-Mart in Shenzhen, China, in 1996, 100,000 customers came through the doors the first day; it also has set a global record with 40,000 sales in a single day.