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The last Lato Letter was exactly one month ago today and since that time, US markets have hit all-time highs and the Padlock composite portfolios have advanced at an even better clip. The last time I wrote about Apple in The Lato Letter was the morning before their 1st Quarter earnings release on January 23rd. Although Apple exceeded the analysts' consensus estimates that day, the stock fell 12.3% the next day, has been down 18 out of the next 27 trading days and at one point was down over 40% from its September 2012 high and all of this in a strong market. As mentioned, fortunately for the clients of Padlock, in spite of the decline in Apple, their portfolios have more than weathered the storm and exceeded their benchmarks as the other holdings have more than carried their weight so far this year. In my 32 years of advising investors, there...

Late last year, Padlock was hired to manage the US Equity portfolio of an area foundation. I have recently received a request from the foundation to provide a description of the holdings that were purchased on their behalf in that portfolio. The information below is the material that was sent to them earlier today and so I thought I would share it with you. Air Methods (AIRM-NASDAQ) Air Methods Corporation is a provider of air medical emergency transport services and systems throughout the United States of America. The company is the leader in the air ambulance business and is a major beneficiary of enhanced healthcare coverage in the US. Price/Earnings (P/E) multiple reflects projected earnings growth in the high teens. Amtrust Financial (AFSI-NASDAQ) Amtrust Financial Services, Inc. is a multinational specialty property and casualty insurer company, focused on generating consistent underwriting profits. Very well managed company has grown both organically and through acquisitions. Very...

Google reported earnings last night that were comfortably better than the estimates but the stock price took a huge jump today. Google, as usual, did not provide specific guidance for the next quarter but they did offer a positive view of how the company is managing the transition from desktop search to mobile search. Although investors, myself included, do focus on the quarterly earnings reports it is the broader picture and the stock’s valuation that are far more critical. Google laid out that its business plan continues to be on track and that with its still very reasonable valuation prior to and even after today’s move, the stock remains very attractive. The next big earnings report is tonight, when Apple reports its fiscal 2013 1st quarter results. I was asked to comment on the results by Proactive Investors and here is the link to their article. Although the article does focus on today’s...

The start of 2013 has been encouraging as a bit of optimism is creeping back into most parts of the market.  The Winter 2013 quarterly version of The Lato Letter should be out to you later this week or early next, at which time I will more thoroughly discuss my outlook heading into the rest of the new year. In the interim, today’s commentary from Don Hays can be found here.  I have referred to Don and his team in earlier issues and I thought you would like to see his outlook.  Rest assured, I am not in violation of the warning on his letter that I have agreed not to send it out because I do have a long understanding with the Hays Advisory Group that allows me to send the occasional letter out.  Hope that you enjoy the letter and the longer term perspective that it contains.  My outlook...

I have followed the work and writings of Laszlo Birinyi for many years but have never had the privilege of meeting him. In spite of never having met, Mr. Birinyi and Barron’s gave me an early Christmas gift this weekend with the article “Three Stocks for an Aging Bull Market”. The three stocks that Mr. Birinyi recomended were Apple, Sears Holdings and Walgreen’s; all part of the Padlock portfolios. In addition to the details on why he likes the three stocks, Mr. Birinyi also discusses the reasons he continues to believe that the current equity market still has potential upside. I think that you will find his views on both the stocks and the market very sensible. The Lato Letter is a market commentary and not a political forum but with the tragedies in Newtown last week, we all, even if we are Canadians, must make our views known on the need...

Needless to say, given the volatility in the stock recently, I talked about Apple today during Market Call. To provide far more insight into the company, Tim Cook, the CEO of Apple, was interviewed for the cover story of Business Week. The lengthy article is well worth reading and provides many insights into Tim Cook and Apple. Here is that link. Finally, tonight at 10:00pm Tim Cook will be interviewed on the NBC show Rock Center. As they say, check your local listings for the time and station in your area. As I said to a client earlier today, for years it has been easy to be a shareholder of Apple but now we are having to earn, through our patience, what I still believe will be above average returns. To receive The Lato Letter by email from now on, please click here....

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