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Should You Be Shopping for Shares at Macy's?


With no near-term catalyst, maybe not.

I took advantage of the warm weather this past weekend and put up a slew of Christmas lights around my house. But my wife wants more, so it's back to Walmart tonight for a few more strings. I'll keep you posted.

Asian stocks rose overnight. The Hang Seng and the Nikkei were up 1.34% and 2.43% respectively. European stocks were in positive territory too earlier today. And here in the US, we're currently trading higher.

Here's what I'm focused on this morning:

Macy's (M):
The old-school retailer took a pretty good pummeling yesterday dropping nearly 4%. And so some have asked me whether or not I think it makes sense to take advantage of the dip and shop for some shares.

I'm really left wanting here. The stock is pretty fairly valued at 14.3 times this year's estimate. I'm also wondering what the near-term catalyst could be. And as many of you know, I'm not too hip on department stores and would much prefer to wade in the discounter pool.

Bottom line, I won't be bellying up. And the same goes for Saks (SKS), which got its clock cleaned yesterday too, to the tune of more than 6%.

Altera (ALTR):
The chipmaker was out with some good news yesterday: It upped its fourth-quarter guidance. In a release it said that "based on quarter-to-date results and the company's outlook for the remainder of the quarter, the company now expects sales for the fourth quarter to be 15 percent to 18 percent above third-quarter levels. Previous guidance was for sales growth of 6 percent to 10 percent."

My take:

1. Clearly it's good news and the momentum the stock has seen could continue a bit. This could be particularly so if we start to see analysts raising their numbers.

2. But I'm skeptical about chipping in because it's trading at about 18.8 times the 2010 estimate (which is $1.12). I think it's pretty fairly valued at that multiple. That said, if the NASDAQ takes a hit or the shares go back to the mid-teens for some reason, I might take another look.

For my previous take on Altera, click here.
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No positions in stocks mentioned.

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