I trust that Thanksgiving provided everyone an opportunity to enjoy quality time with family and friends. Undoubtedly, many of you continued to enjoy the Thanksgiving leftovers through the weekend, and since I suggested they were
- Frontier Oil (FTO): Monday morning the stock opened at $34.50. Friday afternoon, the stock closed at $37.07. This represents about an 8% gain in just one week.
- Dell (DELL): I suggested buying this stock Monday morning as well, and it opened at $29.98. The stock closed Friday at $30.33. This represents approximately a 1.5% gain in one short week.
Buying Good HealthCentene ( CNC) is a major player in the fast-growing Medicaid managed-care industry, providing managed-care programs and related services to individuals receiving benefits under Medicaid, including Supplemental Security Income (SSI) and the State Children's Health Insurance Program (SCHIP). The company's health plans serve Indiana, Kansas, Missouri, New Jersey, Ohio, Texas and Wisconsin. Centene contracts with other health care organizations to provide specialty services, including behavioral health, disease management, nurse triage and treatment compliance.
Our Board of Directors determined that a stock buyback is in the best interest of our shareholders. This action is reflective of Centene's ongoing confidence in our underlying medical cost trends and short- and long-term growth prospects. Furthermore, the flexibility of the program will ensure that future share repurchases will not hinder our ability to conclude acquisitions and achieve our goal of building a leading multi-line managed care enterprise.You have to love seeing a management team with that kind of confidence in its company (and itself). And you'll love these fundamentals even more: Centene has a forward P/E of 13.18, its return on equity is 18.26%, total debt is $88.1 million and the company has free cash flow of $126.61 million. You can buy it at the 50-day moving average (MA) at $23.62 and look to sell at quarterly resistance, which is $31.89. My second pick this week is BT Group ( BT), a leading European provider of telecommunications services. Based in the U.K., BT serves over 20 million business and residential customers with more than 29 million exchange lines, and provides network services to other licensed operators. The company's second-quarter revenue rose 4.8% year over year to $8.51 billion, and earnings per share has now grown for 14 consecutive quarters. BT earned a staggering $647 million in the three months ended Sept. 30. Revenue from the group's traditional business declined 5%, due to a charge of $122 million for the costs of creating a new business unit required under its agreement with Britain's telecommunications regulator, which saved BT from breaking up its retail and wholesale division. The company has been focusing on new services, such as broadband, to deliver growth, with revenue from its "new wave" services rising 39% vs. the second quarter last year. This was mainly generated from networked IT services, broadband and mobility, and it reached $2.52 billion, accounting for 30% of revenue, compared to 22% in the second quarter of last year. In June, the company unveiled Fusion, which blends landlines with mobile phones and allows consumers to use the same phone at home and away. On Nov. 10, CEO Ben Verwaayen said, "The transformation of BT is right on track."