Daily Investment Tips

To know where a company stock is heading you need to look at future sales and profits. If the future revenues and profits will go up the stock will follow. One way companies boost sales and profits is by introduction of new products.

One company introducing new products is Starbucks, the coffee store power house. Speaking during the Shareholders annual general meeting, the CEO told shareholders what the company is brewing.

“Starbucks is firing on all cylinders,” CEO Howard Schultz told 2,000 shareholders. “We are now creating lots of Starbucks products to live outside of our stores.”

The move comes at a time the company is barreling into the multibillion-dollar consumer product goods segment. Starbucks executives say sales from this emerging side of the business will someday match sales from its retail stores.

According to annual reports, in 2011 Starbucks total sales was $11 Billion that brought in profits of $ 1.2 billion. If the company can double it sales to $22 Billion you can predict the profits will also rise. At the moment, Starbucks profit margins are at on average around 11%. By that estimate you can predict if revenues hit future target the profits will more than double. Some of the products they are introducing such as energy drinks have high profit margin.

written by Constantine Njeru \\ tags: Annual Reports, Coffee Store, Company Stock, Energy Drinks, Future Sales, Howard Schultz, Introducing New Products, Profit Margin, Profit Margins, Profits, Retail Stores, Shareholders, Starbucks, Starbucks Coffee, Target

If you are thinking of investing in oil in 2011, there are three ways of investing in oil,  as a physical commodity, oil ETF or in oil stocks.

Oil Stocks 2011

Buying traditional oil stocks is the easiest method to investing in oil. You can buy stocks of oil giants such as Exxonmobil, Chevron, Shell and BP. One interesting oil stock is BP. The company stock was battered in 2010 due to bad news from the Gulf of Mexico accident. But the cost of the cleanup may be less than feared and the share price has recovered some of the lost ground.

Another good thing about Oil stocks is they are known for paying generous dividend.

Don’t limit yourself to the oil giants. There are many small oil companies operating around the world. If you look far and wide you may find undiscovered gems.

Oil Futures 2011

Oil futures market as been around, for a long time it has been the only way to invest directly in oil. Investing in oil futures is done via commodities market. In places such as London, New York and Chicago. This means you must use a commodities broker to invest in them. You can find commodities brokers online at several websites.

Oil ETF 2011

Now there are ETF, exchange-traded fund. Oil ETFs are traded just like shares but reflect the price of Crude oil price.

Oil ETF investments may not be as simple as they seem. Do consult a stockbroker if you are keen on investing in Oil ETFs.

written by Constantine Njeru \\ tags: Commodities Brokers, Commodities Market, Commodity Oil, Company Stock, Crude Oil Price, Etf Investments, Exchange Traded Fund, Futures Market, How To Invest In Oil, Investing In Oil, Oil Etf, Oil Futures, Oil Giants, Oil Stock, Oil Stocks, Physical Commodity, Price Of Crude Oil, Price Oil, Traditional Oil, Undiscovered Gems

Businessweek has a story about investment funds that have invested in Facebook. This funds are providing retail investors with a means to invest indirectly into facebook.

Facebook Funds

EB Exchange Funds, based in San Francisco, along with New York firms Felix Investments and GreenCrest Capital, have opened Facebook funds.

Since you cant buy facebook stock directly you instead buy into the fund just like you buy a mutual fund.

Read the full story at businessweek facebook.

There is no doubt facebook is the biggest story since Google. Those investors who were lucky to get in early are smiling all the way to facebook IPO date. Funds such as EB exchange have given retail investors another window to get a piece of facebook.

Although Facebook is still a private company investors have been able to buy stock of the company. Stock of Facebook trade on a private-company stock market. The market is known as Secondmarket.

Although there is a secondary market it is extremely hard for outsiders to even get a single stock. The funds have provided another window to get into facebook.

written by Constantine Njeru \\ tags: Businessweek, Buy Stock, Company Investors, Company Stock, Exchange Funds, Facebook, Felix, Google, Greencrest, Investment Funds, Investments, Mutual Fund, No Doubt, Outsiders, Private Company, Retail Investors, San Francisco, Stock Funds, Stock Ipo, Stock Market, Stock Trade

Eldorado Gold is a Canadian gold mining company. It has operations around the world.The company stock is listed in NYSE.

Eldorado Gold Competitive advantages

The only North American mineral operator with mines in China. Which places it at a strategic position to take advantage of the booming Chinese economy.

The company has low cost strategy, Eldorado aims to keep the costs of mining, processing, transport, and selling around $375 an ounce.

When you think about that low cost strategy, gold could fall dramatically from its current heights around $1200, and Eldorado would remain profitable.

written by Constantine Njeru \\ tags: Canadian Gold, China, Chinese Economy, Company Stock, Competitive Advantages, Eldorado, Gold Investing, Gold Mining Company, Gold Stock, Investing In Gold, Nyse, Ounce, Stock Analysis, Stock Investing

Although Facebook is still a private company investors have been able to buy shares of the company. Shares of Facebook trade on a private-company stock market. The market is known as Secondmarket.

According to an article I read in Techcrunch

SecondMarket is a private stock market with thinly traded shares where demand often outstrips supply. (By definition, private stock sales trade in an illiquid market)

The Article makes analysis of the latest valuation of facebook, as of june 2010

Shares of Facebook on private-company stock market SecondMarket are going through the roof right now. This week, Facebook shares traded on SecondMarket passed $50, giving Facebook a total market value of $25 billion, according to sources with access to the market. (SecondMarket itself does not disclose pricing or valuation of the private stocks it trades)

Facebook shares are available to investors via SecondMarket. If you want to buy into facebook before the IPOthen you may consider opening an account at SecondMarket. According to the site, Signing Up is free!

written by Constantine Njeru \\ tags: Buy Shares, Company Investors, Company Shares, Company Stock, Facebook, Illiquid Market, Investment Tip, Private Company, Private Stock, Private Stocks, Stock Market, Stock Sales, Stocks Shares

Successful investing in stocks is never easy because of the many factors that affect a stock. In this article I outline the 10 factors that you need to go through before buying  a stock.

1. Understanding the Services or Products the company sells.

Buy stocks of companies that you understand. If you cant figure out what the company sells it is impossible to understand the companies financial s.

2. Understand How to read a  Companies Balance sheet and Income statements.

Drop by your local library and borrow a simple guide to accounts or economics  and read pages on business finance. If you cant crack it on your own hire a tutor.

3. Understanding the Sector / Industry

Understand the number of players in the sector and the position of your target company. If the company is the market leader it has advantages.

4. Understand how the company will make you money.

Figure out why the company will outperform. How they launched new products that will do well? Are they expanding abroad or into new markets? These are the factors that keep a company stock rising.

5. Understanding that stocks go up and down.

Its important to know stock prices do not go up in a straight line. Stocks prices sometimes go down. When they they drop don’t panic and sell.

6. Take advantage of free online tools.

Free online tools such as Google finance and yahoo finance can help you a great deal in doing your stock purchase research.

7. Investing for dividends.

Some stocks are in mature industries. These stocks have few opportunities for price appreciation. But the good thing about them is that they pay annual dividends. Such industries are mining, oil and tobacco.

8. We All Mistakes.

Even after going through the best research mistakes will be made. When you realise you made a mistake the best thing to do is to cut your losses. Sell the stock and invest the money in a new stock.

9. Diversify You Stock Purchases

You have heard it since you were a kid “Don’t put all your eggs in one basket.” Don’t put all your money in one stock, spread the money in different stocks. This will protect you from large losses.

10. Have an exit strategy.

Have a targeted share price you want to reach before selling all or part of your position? If you reach your target share price, stick to your initial plan and cash out at least some of your position.

While this stock investment guide is by no means exhaustive, it will certainly help you begin your thought process when making a decision to buy a specific stock or not.

written by Constantine Njeru \\ tags: Balance Sheet, Business Finance, Buy Stocks, Buying Stocks, Company Stock, Dividends, Eggs In One Basket, Free Online Tools, Google, Income Statements, Investing In Stocks, Investment Guide, Line Stocks, Local Library, Market Leader, Mature Industries, Price Appreciation, Stock Prices, Stock Purchase, Stock Purchases, Straight Line, Target Company