4 May 2016
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New Officers:
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Presidents: Bianca Yang and Paul Nunzez
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Secretary: Claire Goeckner-Wald
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Director of Operations: Dillon Azzam
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Treasurer: Akshay Srivastava
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General downturn in the economy. NASDAQ dropped.
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Apple (AAPL)
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Every time Apple’s stock drops, the company buys
more stock back; are they making the company semi-private again? Probably not.
o
Apple has been pushed to buy Tesla; general
consensus: probably not.
§
Elon Mush is not interested in that area of
work.
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Apple is turning away from a growth company. P/E
close to IBM.
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Apple thought to be developing a vehicle; the
iCar. They already have a system for integrating with cars.
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Apple has registered “apple.car” domain.
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Oil is up.
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Petrobras (PBR)
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It has turned around, is up 60% in the past
several week.
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Why?
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Brazil is in total chaos, but overall, oil has
been up substantially; thus, the increase.
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Thought: it’s only because they’ve been doing
very, very poorly earlier.
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Possibly most indebted company in the world,
concerning people. However, they have huge oil reserves. So, they have lots of
future value.
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They were purchased at $16 in 2013. We lost a
lot of money here, selling it when it was approximately $5.
o
British Petroleum (BP)
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We do not own this stock anymore.
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Royal Dutch Shell (RDS)
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We have owned Shell for a while.
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Shell just had earnings and they looked way off.
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They have enough cash to pay their dividends.
This is why the oil company’s stocks are going up. No major company has cut
their dividends yet.
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Biotech and Pharmaceuticals have been fairly
hammered in the last months.
o
Valeant Pharmaceuticals (VRX)
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$20 billion loss in market cap recently.
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Teva (TEVA)
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Teva we still own, since 2007. They are long
term.
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They are down due to a recent failure to in
denial of funding by New Zealand for one of their drugs, and due to earnings.
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They only sell generic drugs; they are 60-70%
cheaper, so they can have higher margins.
o
Merch (MRK)
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Merck is down this week.
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They won a case against Gilead Sciences (GILD)
for patent infringement. It’s $2 billion and ongoing royalties.
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Thus, Gilead is down a lot.
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Oncology drug can be $150,000 per year, so
there’s a lot of profit. This is why it was denied in New Zealand.
o
BIND Therapuetics (BIND)
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Nanopharmaceutical start-up out of MIT.
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Filed for Chapter 11 bankruptcy to restructure
debt, to hold off the creditor, so that they don’t default.
·
Not likely to affect shareholders.
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Chapter 7 is extremely unlikely.
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All the airlines went into Chapter 11 and they
were fine, so it doesn’t necessarily mean much.
o
Arrowhead (ARWR)
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Has developed a promising drug for Hep B that
would provide a big boost.
·
Could even be a functional cure.
·
Is already Phase 2, testing on people who have
the disease. They have passed Phase 1 already.
·
At Phase 3, they file with the FDA, and may
approve, reject, or reject it conditionally. If there’s not another drug of the
kind, they can fast track it from Phase 2.
·
They must cut a deal with AllScripts or
something else, depends on the company.
·
Could be a year, three years.
·
Competition: Gilead may also be doing this, but
Arrowhead seems to be leading.
§
Rumor that they may be purchased by Gilead
Sciences (GILD).
§
They are pretty small, may be purchased for $600
to 700 million.
o
Gilead Sciences (GILD)
§
May purchase Arrowhead.
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Caterpillar Inc (CAT)
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Purchased at $52, $54.
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Strong growth everywhere except for those in oil
and gas. Overall, they had a solid earning reports.
o
They have raised dividends constantly for twenty
years.
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Aerospace
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Boeing (BA)
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Makes passenger aircrafts, unlike Lockheed and
Northrup.
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Boeing does do space and defense, too.
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Airbus did better last year, better than Boeing
did.
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777s are not selling super well, but both Airbus
(French + English) and Boeing (American) are in good shape.
§
China bought a bunch of 737s, but they only fly
the shell over. They do the finishing there, which cuts a lot of dollars out of
the sale.
·
Both Airbus and Boeing were forced to set up
finishing operations in China
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Boeing also went down on April 27th for
releasing earnings that were 10 cents per share lower than expected.
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Lockheed Martin (LMT)
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Northrup Grunman (NOC)
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Autos
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Rolls Royce (RR)
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Now that they’re focusing less on profitable
engines, their profit margins are going downhill.
o
Fiat Chrysler
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Signed a deal with Google to produce their cars,
doubling their fleet.
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Entertainment
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Comcast Corporation (CMCSA)
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Possibly purchasing Dreamworks.
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Everybody hates this company, but everybody
hates every company.
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Cable may die soon.
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$200/month gets you “the works”.
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Fox (FOX)
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Disney (DIS)
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Disney has done consistently well.
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Recently released newest Stars Wars.
·
Ryan’s motion to sell everything. (PASSES)
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Idea is that the club can come in a pick stops
anew, instead of having forty different holdings that were picked along time
ago.
o
Suggestion: keep stocks that were purchased this
year.
o
Suggestion: give a date in an email saying “come
on this day to defend this stock, or the stock may be sold”.
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Stocks defended recently in the past may be
kept.
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Final conclusion: any stock that was bought
before January 1st 2015. By June 4th / end of term, we
purge any stocks that haven’t been defended. If you defend a stock, you own it.
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We may buy too small pieces of stock.
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Target purchases of around 4%, or 25 stocks in
the portfolio.
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Current cash value is $600,000.
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Set up a range for how much we can purchase of a
certain type of stock.
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“Less stocks -> more focus”. “We have too
many similar companies.”
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