Kraft and IBM have headwinds in the US. Buffet is buying them for their overseas opportunities as much as anything else. The growth is not in the US.
The whole organics thing is a very serious competitive threat as it gains traction. But, let's face it, most folks won't shop at Whole Foods, aka, Whole Paycheck. But, IBM doesn't sell groceries.
Buffet is a GARP player as much as anything at this point. The earnings will come from overseas, not so much the US. If they come at all for either IBM or Kraft. But, the price of both is pretty reasonable, so not a lot of risk (on the surface).
The next few quarters of IBM on the hardware side will say a lot about prospects. New cycles on Z and P should drive some good biz. If it doesn't, that will definitely show diminished near term prospect for IBM. If Open Power can blunt ARM, then deflate INTC profits, then it gets interesting.
Google - "America's changing grocery habits are a huge threat to Kraft and Heinz" = Business Insider
Kraft is a dinosaur that is slowly losing market share due to changing consumer trends away from packaged products and towards organics and fresh produce.
Think I am wrong.
Go into any major supermarket and look at what many people are buying.
Kroger understands what is going on and is moving towards more organic related products.
You remind me of an investor type that has no clue as to the changes occurring in a market place that business it owns sells into.
Before using Kraft as an example I suggest that you look at consumer trends that are impacting the grocery industry.
Kraft is under increasing pressure due to changing consumer habits.
Consumers are moving towards organics, fresh produce and away from packaged food products.
So far, IBM is earning money every day and every month as we speak. I cannot eliminate that so long as it pays the dividend, make great cash flow. I agree corp American may be full of greed. I do not think Buffet needs that. Do you trust the analysts earning 100K or the person earning more than 1000k in a minute ? With my own analysis, the cash IBM is generating, I concur with Buffet. IBM is the best bargain in blue chip, the lower it goes sideway, the more money it is accumulating on the balance sheet as retained earning. Stock price has to reflect that eventually. IBM is the kind of business that can own and just see its revenue compounding positively. Who knows, Apple will buyout IBM next with its change, IBM is a mirror of Kraft, deep value under priced business. .
Sentiment: Strong Buy
topinvestfool wrote: "management with integrity."
You must have missed the part where the soon-to-be CEO - Bob Moffatt - went to jail for insider trading.
And how about the part where the Justice Dept. filed racketeering and money laundering charges against 5 IBM senior executives.
i do know this .....chinese corp hackers are better than ibm is at protecting itself.....besides this fact, 'approval_myass,' you have long lost any credibility of objective opinion.
after all, says she.......china has already stolen all things tech from ibm....as ibm has ceased to be innovative, it has no secrets. lol
A real correction to the overall market will drive IBM through it's recent 153 support toward weak support at 140 and most likely to stronger support at the 125 level. Earnings could also be a catalyst to this downside move. In addition the BOD meets in late April during the stockholders meeting and they need to act to support the CFO's assertion of return of free cash flow through dividend increases is the model going forward.
Very choppy in here.