The Brett Favre saga finally was resolved when the Packers sent him to the New York Jets, and the Jets, in turn, sent their longtime quarterback Chad Pennington packing. He was cut from the team yesterday.
Jet fans are ecstatic about Favre's arrival, but maybe they shouldn't be. This might be a perfect example of not looking past the numbers and accomplishments and evaluating the circumstances surrounding this asset.
In my opinion, what looks like a new beginning will actually be a quick end to a great career. I think this will be a "one and done" situation. Take it from me, something happens when a veteran player is rejected by the team he made his name with. You start to overthink every situation, questioning your skills on every level. An overthinking quarterback (the field general) is a quarterback on his way out of the league.
For me, it was really difficult going from the classic Silver and Black of the Raiders to the pewter, gray and crimson of the Tampa Bay Bucs. It was not cool at all. The first time I saw myself in the mirror, I literally took a triple look at myself! Probably the worst part of the whole deal is living in a new house, driving on new streets and being in the locker room with new teammates. There's something to be said in the NFL for the old adage "you can't teach an old dog new tricks."
It's important when picking up a stock to understand not just the numbers, but the intangibles. Today, I'm going with a company that is in a sector that is down and should be poised for a comeback. I'm going with
Raytheon designs, develops and makes technological products, services and solutions for government and commercial customers. Its six segments include integrated defense systems, intelligence and information systems, missile systems, network-centric systems, space and airborne systems and technical services.
In English, this means the company provides ballistic missile defense, integrated ground systems for signal and image intelligence, weather and climate systems, and command and control solutions for air/space platforms, among others.
I like this company for a ton of reasons.
It's got more than $2.5 billion in cash on hand and almost the same amount in operating cash flow. Its forward price-to-earnings ratio is 13.27, which is a good sign because investors confidence in this stock isn't bloated. It has revenue of more than $22 billion and a return on equity of 14.77%. It has big-time institutional support at more than 80%.
Furthermore, its second-quarter earnings painted the picture of a healthy company. It did show a big drop in net income due to a one-time charge. Since it is a one-time charge, I am not too concerned. However, looking deeper, the company showed lower pension expenses and higher sales of its missiles and border security. In all, net income from continuing operations grew by 20%.
It's been on the upswing in the last week. In early trading, the stock was up about 2% and was trading recently at $59.58. That's smack in the middle of its 52-week range of $52.83-$67.49.
This company will definitely chew up some yardage, so I think picking up some shares will be a great addition to any portfolio.
Keep moving the chains!
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At the time of publication, Brown had no positions in stocks mentioned, although positions may change at any time.
Tim Brown played 16 seasons in the NFL, where he made nine Pro Bowls. After a brief stint with the Tampa Bay Buccaneers in 2004, Brown retired as an Oakland Raider. He was a Heisman Trophy winner in college for Notre Dame.