There were again no significant movements among our stocks in the past week, but many of our stocks went up to their fair values, including Walt Disney (DIS) and Berkshire Hathaway (BRK-B), which are rated Hold. Fair values are approximate measurements that I use as benchmarks to measure stocks’ under/overvaluations.
Walt Disney (DIS) is trading above its fair value and looks overvalued. However, from a long-term view, Disney could be an excellent stock to hold. Disney’s management, under the stewardship of Robert Iger, is strategically focusing on releasing its streaming service, similar to Netflix’s—and with the acquisition of Fox’s assets, Disney will have the best content in the media industry. Disney’s assets, unmatched content and characters could make it a company to hold forever (unless the price goes astronomically high). HOLD.
Signet Jewelers (SIG), which I initially recommended at 67 and recommended to accumulate at 51, is now trading at 55. On January 10, Signet is expected to announce its holiday sales. Web traffic during the holiday season seems to have performed well, however, as we witnessed in the previous quarter, I expect sales to come in as a loss due to downtime on Kay Jewelers’ and Zales’ websites. The stock could go either way depending on the January 10 announcement, but from a long-term perspective, I continue to recommend the stock as a Hold. HOLD.
There were no other major developments this week on our recommended stocks that would impact our long term view.
