Vinyl, Schmynal.

I try to stay modern.

I'm holding onto the Internet, online stuff, and my iPhone with all 8 fingernails in an effort to keep up with those goddamned kids who find this stuff so simple that they can walk, text, drive, and talk on their phone at the same time.  By the way, if you think you can ... you cannot.

I'm with you on a lot of this junk.  The whole "text instead of call" thing is right up my alley.  When my phone rings, I dread picking it up. "Just text me, or send an e-mail," is my usual response.  And this comes from a person who grew up on rotary dial phones and looking for change to use the phone when I was away from home. How quickly I learned your ways, Millennials.

The one thing I cannot join you in is this movement back to vinyl records.  I don't remember what year it was, but at some point, somebody (probably Sony) invented the Compact Disc player.  I was so excited.  No longer would I have to store giant 12-inch recordings and care for them like an elderly parent - constantly cleaning them and looking after them to insure that there wasn't too much dust around, lest they lost their qualities.  What a giant pain in the ass it was.

Along came the CD.   A small, plastic disc that only required placing it back in the case that it came in.  It would sound the same today as it sounded 50 years from now - if it survived the trip.  

My favorite music was the sort of thing that had quiet passages and subtle changes in mood that we could not hear on vinyl because the record would pop and scratch.  

When I heard of this magical thing called the CD player, the first thing I did was go out and buy CDs.  Kate Bush's "The Dreaming" and King Crimson's "Lark's Tongues in Aspic" were my first purchases.  I had a half-dozen CDs before I had a CD player.  That's how excited I was.

My wish of noiseless music was granted. I didn't have to worry if the record I brought home was warped and/or it would skip, and I had to clean it endlessly or place a penny on the tone arm to make it play.  What a relief!  I bought Beethoven's 5th Symphony and a few other classical music CDs before I finally sprung for the $129 (in 1980s money) for a CD player. I reveled in the purity of the sound.  It was beautiful.  Quiet passages were quiet, and there was nothing that sounded like you were listening to music around a campfire.
I listen to stuff on CD and mp3 that I heard originally on vinyl and WISH that I could have had this format in the 1970s.  Egad, no maintenance, no care.  What a life.

Until...

These bloody Millennials figured out that, for some reason, vinyl sounded ... I don't know ... pure to them, or some damned thing.  They were too young to remember the toils of record buying and maintenance.  To them, the vinyl experience was akin to riding a Penny-farthing and thinking, "This is how cycling is supposed to be." No, it fucking isn't.  We found a better way.

The sad thing is that the marketing pressure is so deep that vinyl pressing factories have been re-staffed, and there is a resurgence of the crap.  New bands are releasing stuff on vinyl to appease this group of nincompoops who think that vinyl has some magic.  No, it fucking doesn't.
I love my Apple Music and my mp3s.  Quality loss? I don't think so.  Not compared to the scratch-scratch-skip of those fucking vinyl albums.  I'll keep my entire music collection on an SD card, thank you.

I can't wait for them to want to go back to rotary-dial telephones, bathing on Saturdays, cooking food in conventional ovens, starting cars with a crank, ... well, you get the picture.  There is a better way, and it's sad that some people are too young to appreciate the efforts that their ancestors went through just to be able to listen to music
I'm on my 4th incarnation: Vinyl, CD, cassette, (8-track - if you count that disaster) and now, mp3. I'm done, and it gets better because it gets ... well, better.

Perhaps they would like to go back to standing in line for concert tickets on Saturday mornings, too?  Well, no. That would cut into their sitting around time.

Get a grip, gang. It's way better now.

So ... How are Ya Doing?

It's Earnings Season again.  And as such, it's a little daunting to keep track of it all, but I'll give it a shot.  So, how am I doing?  I write a lot about my investments, and I'll quickly tell you if I fail, but this last quarter and the last six months have been mostly positive.

While I still eschew big-time growth names that I find over-valued, I tend to stick with stocks with one of two potential issues:

1 - There is a growth story, and we are at or near the beginning of it.

2 - There is value in a mature company.

As in life, I don't like to over-pay for anything.  If I think a stock has run-up into a valuation that is either "priced for perfection" or just plain over-priced, I'll pass - and I'd advise you to do so, too.  It's not that I don't appreciate the risk, but I don't necessarily want to pay for it.  Tesla, Facebook, Nvidia, Google - are some of the names that, if I had a 5-year-old, I would happily invest in. At my age ... eh.

I would say that every one of my investments fits one of those two categories.  And so ...

First, the anticipation:  One of my favorite companies (and stocks) Extreme Networks (EXTR) reports on Tuesday.  More important than their earnings report will be their outlook for 2018.  The stock is up about 200% year-to-date, so we're hoping (I hate that word) for some upbeat guidance for a company that has been grabbing market share in the network infrastructure business.  Currently, it's at 18 times future earnings, which could prove to be cheap by today's price of $11.88.  Don't be brave and buy it here. If you've owned the stock from $3.95 back in August of 2016 (as some here have) then you're ahead of the game regardless, and you should have been paying attention.

Cisco Systems (CSCO) reports on the 15th, and almost everyone is expecting big things from this networking giant. They're old-school technology trying to reinvent themselves into new-school data protection and subscription services.  It says here that they can accomplish it, and I wouldn't bet against CEO John Chambers.  Any sort of upbeat report will send the stock soaring toward the high-30s, and if you're willing to buy it here, at $34.60 it should be money well spent.

Another one of my favorites, Square (SQ) reports on the 8th.  It's a big deal, since the stock has run-up significantly over the past month on -- well, nothing really -- and I'm curious as to whether my faith will be rewarded or I'll have to take my profits and move on.  My gut tells me that there is more room to run here, but I wouldn't be adding or buying at the $36 range it's been trading in for the past week. There is a lot of speculation, and still some takeover speculation that might be driving the price up.  They should be making a nice forward-looking statement next Wednesday that should reinforce my confidence in Jack Dorsey and the gang.

Looking back:  DelTaco (TACO) reported a lackluster quarter, and the stock sold-off significantly. However, if you had faith and bought it in the $12 range that it sold down to, you're feeling pretty good about yourself here at $12.60.  But that doesn't salve your wounds from potentially getting out at $15.  If you're a long-term investor (like me) you could be looking to add to a position at this range and figure that the quarter wasn't bad - just not as good as anticipated.  They are still expanding and making money, of course.  The food service business is tough, but they have a management team that should be able to keep the growth story alive. I'm still long.

You might not know much about Acco Brands (ACCO) but if you look at those paper clips, binder clips, and other office supplies that you have (ahem) stolen from your company, you'll see Acco's name all over them. A week ago, they reported diluted earnings that beat last year's numbers by 33%. A stock that I have been looking for an excuse to sell might be a longer term hold than I had anticipated.  At 11 times forward earnings, it's still cheap, but the space is not widely recognized.  You'll (I'll) have to be patient, and even though I'm up on the trade, I'm looking for the $14 to $16 range before I get out.

Last, but not least - my favorite micro-cap Limelight Networks (LLNW) reported the classic "beat and raise" with gross margins, cost-cutting, and operating margins all coming in at the high end of what was anticipated.  They say that they are going to "take on Cisco," and I say, "Go ahead," because - well, I'm in.  I love their aggressive management and the growth story in content delivery as much as I like Square's payment space.  Sometimes, things just grow, and you can't be afraid to be at the bottom-end of the story.  Ask early Facebook and Amazon shareholders.

Summary:  While the Pfizer (PFE) quarter was nothing to write home (or here) about, I held on, and after the small sell-off post-earnings, the stock rebounded.  I'm guessing that investors liked the stability in a market where instability seems to rule the day.  Plus, the 3.65% yield and the forward P/E of 13 make it an attractive investment for people (like me) who want all the upside with almost none of the downside.  At the age of 60, I like that stability in my life.

So, where do we go from here?  Some brick and mortar retail is on life support.  JC Penney, Sears, and Macy's are breathing their dying breaths. What to do?  Run away.  It isn't that Amazon is killing modern retail, it's just that there is so much of it that the space has gotten too crowded.  The weaklings will have to be weeded-out before we can recognize the survivors.  If you feel so compelled, there is an ETF that tracks the retail space that could cushion your risk.  Symbol XRT is trading at year lows, and might be a good choice if you're looking to get in without getting burned.

On the other end, Mattel (MAT) and personal favorite Under Armor (UA) are struggling, and their shares are in free fall.  Both companies admit to having issues, so you're best to be bottom-fishing in the first quarter of 2018 once the Christmas shopping season has nearly killed them.  It's hard to imagine either one of them going away, but on the other hand, it's easy to imagine both of them going away.  They are at once compelling investments and risky as shit.

Facebook is selling-off after earnings, and I think I said that they were over-valued at $160.  In the $180 range today, you may get another shot at that $160 price if you're courageous enough to both wait and weigh-in. Revenue rates are declining, expenses are growing at 40% to 60% over the next year, and cap-ex will double in 2018.  Let it settle-in until at least Monday or Tuesday, and then?

Tesla is struggling to keep-up with production, and it's likely that the stock could be headed back to the $280 range.  I love Elon Musk and I love the company, but I wouldn't buy it here with your money.  It's just too big a mess, frankly.

There is more, but I feel like I've said enough, and we still have a few more weeks of reports to sift through.