Some Investment Advice For Dubai (YHOO)(HD)(GE)(MO)(DELL)

Banking, finance, and taxes

Published: November 26, 2007 5:53 am

Now that Dubai International Capital has bought a piece of Sony (SNE), it must have a lot more capital to spread around.

A shopping list:

Yahoo! (YHOO) The stock is still down from $43 in January 2006 and now trades at $26. Short-term, the shares may not go anywhere because the perception is that Google (GOOG) taking up too much of the online ad market. But, Yahoo! has a good footprint in mobile search and is one of only four large online portals. It is a play on the long-term strength of internet marketing, and it might be a takeover target.

GE (GE). Nice long-term investment. The stock has not done much over the last half-decade, so management is under pressure to make the company more attractive to Wall St. GE says that its business in China and India will drive its growth over the next decade. And, a good yield.

Altria (MO) Tobacco stocks are as good a place as any to park money. Very strong yield. The stock is likely to move up more when the company’s international operations are spun off. A lot of people in the Middle East, Asia, and Europe are still big smokers. Good "vice stock" addition to the Dubai portfolio.

Home Depot (HD) Available at a huge discount, if Dubai thinks the US housing market will revive in the next three or four years. Good share buy-back. Leader in its market segment. Stock down from 52-week high of $42 to under $29. Has a yield of almost 3.2%, almost as good as a bond.

Dell (DELL) Nice turnaround play, if Dubai thinks Dell can get back some of its market share in global PCs. In mid-2005 shares were at $42 and now trade at $26. Founder Michael Dell has a big incentive to make the company work–his own net worth.

Douglas A. McIntyre

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