Chicago Area Corp Stock Prices Up an Average 208% Since President Obama Took Office

In a October 16, 2012 post, I found 59 Corps headquartered in the Chicago Area, which had their common stock trading on both January 16, 2009, which is the last day stocks traded before President Obama took office, and also on October 15, 2012, and which also had externally audited under US Generally Accepted Accounting Principles (US GAAP) After-tax Net Income or Net Loss From Continuing Operations of at least $100 mil in any of the previous five fiscal years.

These 59 Chicago Area Corps had their average stock price increase by a huge 145% from the time President Obama took office in his first term and October 15, 2012, as you can see from the below link:

Chicago Area Corp Stock Prices Up 145% Since Obama Took Office 

So, how have these companies done lately?  Well, even much better, with their average stock price increase by 208% from January 16, 2009 to the close of today May 29, 2013.  And this 208% increase is more than double both the 85% increase in the Dow Industrials Index and the 94% increase in the S&P 500 Index over the identical time span.

There are many financially astute Chicago Area citizens, and they already had this all figured out.  They probably just didn't previously have the precise average percentage increases tied down.

I removed Abbott Labs since it had a huge recent separation, Terra Nitrogen since it is a Limited Partnership, and Aon since it is London-based.  Thus, this leaves the 56 Chicago Area Corps shown below.

It is pretty clear that Chicago Area Corps have flat out thrived during the Obama Administration, and will continue to do so, and particularly so if the US House turns to Democratic control and the US Senate remains in Democratic control, both in 2014. 

Chicago Area citizens have to be extremely happy with the stock market performance of their many fine Chicago Area companies during the Obama Administration.

And Chicago Area citizens also must be very pleased with how the Obama Administration, with much assistance from the US Fed, worked so hard and very effectively on so many fronts to create a US economic environment that permitted these Chicago Area companies to flat out flourish.  This highly successful effort created a robust US economic environment which was quite a change from what existed in the just horrible financial meltdown, near Depression year of 2008. 

Below here are the common stock market closing prices of each of these 56 Chicago Area Corps at both the most recent date (May 29, 2013), and also at the date just before President Obama took office in his first term (Jan 16, 2009), as well as the percentage stock market price changes for this period of time:

	Chicago	Market	Market	Percentage
	Area	Price	Price	Increase
	HQs	5-29-13	1-16-09	(Decrease)
S&P 500 Index		1,648.36	850.12	94%
Dow Industrials Index		15,302.80	8,281.22	85%
Chicago Area Largest Corps
Tenneco	Lake Forest	$44.11	$2.25	1860%
Ulta Salon	Bolingbrook	$91.67	$6.05	1415%
Kapstone Paper & Packaging	Northbrook	$29.34	$2.10	1297%
Brunswick	Lake Forest	$33.14	$3.13	959%
Discover Financial Services	Riverwoods	$47.49	$7.60	525%
Strategic Hotels	Chicago	$8.12	$1.78	356%
LKQ Corp	Chicago	$24.53	$6.02	307%
CF Industries	Deerfield	$194.00	$48.52	300%
Packaging Corp America	Lake Forest	$49.59	$13.33	272%
Hillshire Brands	Downers Grove	$35.10	$9.98	252%
Jones Lang Lasalle	Chicago	$91.50	$26.43	246%
WW Grainger	Lake Forest	$254.99	$76.52	233%
USG	Chicago	$28.02	$9.47	196%
CNH Global NV	Burr Ridge	$43.63	$15.13	188%
Anixter	Glenview	$76.09	$27.17	180%
United Continental	Chicago	$33.00	$11.95	176%
First Industrial Realty Trust	Chicago	$17.52	$6.73	160%
Acco Brands	Lincolnshire	$7.56	$2.94	157%
Accenture	Chicago	$82.95	$32.68	154%
Taylor Capital Group	Wheeling	$16.30	$6.51	150%
Dover	Downers Grove	$77.95	$31.20	150%
Zebra Technologies	Lincolnshire	$45.96	$18.52	148%
CNA Financial	Chicago	$34.32	$13.89	147%
Ventas	Chicago	$72.56	$29.45	146%
IDEX	Lake Forest	$54.99	$22.88	140%
Boeing	Chicago	$99.09	$42.46	133%
Kemper	Chicago	$33.94	$14.94	127%
United Stationers	Deerfield	$33.92	$15.54	118%
Equity Residential	Chicago	$58.54	$27.27	115%
Stericycle	Lake Forest	$108.66	$50.69	114%
Molex	Lisle	$29.40	$13.77	114%
Illinois Tool Works	Glenview	$70.17	$34.63	103%
OfficeMax	Naperville	$12.78	$6.49	97%
CME Group	Chicago	$67.62	$34.90	94%
Aptargroup	Crystal Lake	$56.27	$30.44	85%
Walgreens	Deerfield	$49.54	$26.91	84%
Arthur Gallagher	Itasca	$44.46	$24.35	83%
GATX	Chicago	$50.78	$28.50	78%
Allstate	Northbrook	$48.55	$28.77	69%
Calamos Asset Mgt	Naperville	$10.55	$6.27	68%
Beam	Deerfield	$66.64	$40.12	66%
McDonalds	Oak Brook	$99.05	$59.67	66%
Baxter	Deerfield	$71.34	$54.95	30%
Hospira	Lake Forest	$34.69	$27.04	28%
Navistar International	Lisle	$36.12	$28.47	27%
Old Republic	Chicago	$13.86	$11.88	17%
RR Donnelley	Chicago	$13.00	$11.16	16%
Northern Trust	Chicago	$58.57	$51.08	15%
WMS Industries	Waukegan	$25.39	$24.58	3%
Sears Holdings	Hoffman Estates	$50.23	$49.21	2%
US Cellular	Chicago	$39.68	$41.46	-4%
Telephone & Data Systems	Chicago	$23.25	$29.45	-21%
Old Second Bancorp	Aurora	$5.64	$9.01	-37%
DeVry	Downers Grove	$31.03	$58.99	-47%
Tellabs	Naperville	$2.04	$3.94	-48%
Career Education	Schaumburg	$2.98	$21.41	-86%
Average Increase: All 56 Chicago Area Largest Corps				208%
S&P 500 Index		1,648.36	850.12	94%
Dow Industrials Index		15,302.80	8,281.22	85%

US Technology Corps 1Q 2013 Adjusted After-tax Earnings Down 5%: Clearly Need US Fiscal Stimulus

I found 52 US Technology Corps which have filed their calendar 1Q 2013 earnings with the SEC by May 2, 2013, and which had Core Adjusted After-tax Earnings of more than $100 mil in either the 1Q 2013 or the 1Q 2012.

Core Adjusted After-tax Earnings is what these companies report as their Ongoing Earnings in their quarterly earnings releases.  It is also the key earnings element that the stock market uses to value common stocks.

These 52 US Technology Corps, in the aggregate, were just crushed in the 1Q 2013, with their Total Core Adjusted After-tax Earnings down 5% from the 1Q 2012.  And it was really much worse than that since nearly all of these Technology companies have huge Research and Development Tax Credits, and many of them included their full year 2012 Research and Development Tax Credits in their 1Q 2013 Core Adjusted After-tax Earnings.
 
The main drivers of this 5% Total Adjusted Earnings decline in the 1Q 2013 were Apple, Seagate Technology and Intel.

The Technology companies generating the highest dollars of Adjusted Earnings increase in the 1Q 2013 as compared with the 1Q 2012 were Google, Microsoft and Qualcomm.

It's pretty clear that this critical US Technology Sector needs a huge dose of US economic fiscal stimulation.  This is particularly important since this is where many of the good-paying US jobs are.  But with such lousy 1Q 2013 earnings, the prospects for an increase in these well-paying, full-time US jobs of these Technology Corps doesn't look good for at least the rest of 2013, unless there is a sharp upward earnings reversal.  And certainly the near-term huge Sequester US Government spending cuts will not help here.....just the opposite, and hugely so.

And since these larger US Technology Corps are doing so poorly on an operating basis in the 1Q 2013, it is certain that the smaller ones are doing likewise, and probably even more so.

Don't get misled by the massive stock market upward move so far in 2013.  It's not about strong operating earnings in the 1Q 2013 because they are just not there.  It is all about the US Fed providing such low interest rates for an extended period of time, thereby providing such meager yields on alternative fixed income investments, coupled with also providing an increased incentive for massive, incredibly lucrative common stock buybacks of large US Corporations, which buoys EPS and long-term EPS growth, the drivers of common stock values.  This was all explained in a post I made on March 20, 2013, which you can access in the below link:

Common Stock Buybacks: Main Cause of US Stock Market Sharp Ascent in 2013 

Below here is the Core Adjusted Earnings of each of these 52 US Technology Corps for the 1Q 2013 and the 1Q 2012:

			Core	Core
	1Q	1Q	Adjusted	Adjusted
	2013	2012	Net	Net
	Core	Core	Income	Income
	Adjusted	Adjusted	Increase	Increase
	Net	Net	(Decrease)	(Decrease)
	Income	Income	Amount	%
	mils of $s	mils of $s	mils of $s
Big Technology Corps
Apple	9,547	11,622	(2,075)	-18%
Microsoft	5,479	5,108	371	7%
Google	3,899	3,328	571	17%
IBM	3,376	3,265	111	3%
Oracle	3,108	3,128	(20)	-1%
Cisco Systems	2,722	2,563	159	6%
Qualcomm	2,066	1,759	307	17%
Intel	2,045	2,738	(693)	-25%
Hewlett Packard	1,605	1,832	(227)	-12%
EMC	850	818	32	4%
Ebay	829	725	104	14%
Accenture	720	714	6	1%
Dell	702	913	(211)	-23%
Western Digital	514	619	(105)	-17%
Thermo Fisher Scientific	496	434	62	14%
Automatic Data Processing	483	450	33	7%
Seagate Technology	464	1,222	(758)	-62%
Yahoo	420	334	86	26%
Broadcom	400	387	13	3%
Texas Instruments	362	265	97	37%
Xerox	347	319	28	9%
VMWare	319	287	32	11%
Facebook	287	312	(25)	-8%
NetApp	243	216	27	13%
Agilent Technologies	222	244	(22)	-9%
Nvidia	215	158	57	36%
Sandisk	207	156	51	33%
Motorola Solutions	187	189	(2)	-1%
SAIC	182	106	76	72%
Adobe Systems	179	285	(106)	-37%
KLA Tencor	171	216	(45)	-21%
Check Point Software	159	157	2	1%
Paychex	145	135	10	7%
Maxim Integrated Products	135	100	35	35%
Analog Devices	131	139	(8)	-6%
Xilinx	131	122	9	7%
Linear Technology	130	114	16	14%
Roper Industries	127	108	19	18%
Harris Corp	125	163	(38)	-23%
Juniper Networks	124	84	40	48%
Autodesk	121	106	15	14%
Altera	120	116	4	3%
Amdocs	119	115	4	3%
Citrix Systems	117	111	6	5%
Cerner	117	94	23	24%
Jabil Circuit	109	123	(14)	-11%
Marvell Technology	104	127	(23)	-18%
Intuit	100	158	(58)	-37%
Flextronics	86	166	(80)	-48%
Amazon.com	82	130	(48)	-37%
Teradata	73	103	(30)	-29%
Applied Materials	69	240	(171)	-71%
Total all 52	45,070	47,423	(2,353)	-5%

US Broad-Based Manufacturing Corps 1Q 2013 Adjusted After-tax Earnings Down 10.4%: Clearly Need US Fiscal Stimulus

I found 36 US Broad-Based Manufacturing Corps, other than large US Defense Contractors, which have filed their calendar 1Q 2013 earnings with the SEC by May 2, 2013, and which had Core Adjusted After-tax Earnings of more than $100 mil in either the 1Q 2013 or the 1Q 2012.

Core Adjusted After-tax Earnings is what these companies report as their Ongoing Earnings in their quarterly earnings releases.  It is also the key earnings element that the stock market uses to value common stocks.

These 36 US Broad-Based Manufacturing Corps, in the aggregate, were just crushed in the 1Q 2013, with their Total Core Adjusted After-tax Earnings down a huge 10.4% from the 1Q 2012.  And it was really worse than that since many of these companies included their full year 2012 Research and Development Tax Credits in their 1Q 2013 Core Adjusted After-tax Earnings.  And also, Eaton's very healthy Adjusted Earnings increase below benefits from having no interest expense charge related to the portion of its acquisition of Cooper Industries which was financed with its common stock.

The Motor Vehicle and Parts Corps were especially crushed with their Total Adjusted Earnings in the 1Q 2013 down a massive 19% from the 1Q 2012.  General Motors and Chrysler both had huge Adjusted Earnings declines.

All Other Manufacturing Corps had their Total Adjusted Earnings in the 1Q 2013 decrease by 6% from the 1Q 2012.  The major driver of this earnings decline was Caterpillar.

It's pretty clear that this key Manufacturing Sector needs a huge dose of US economic fiscal stimulation.  This is particularly important since this is where many of the good-paying US jobs are.  But with such lousy 1Q 2013 earnings, some of these well-paying, full-time US jobs of these Manufacturing Corps won't be there for at least the rest of 2013, unless there is a sharp upward earnings reversal.  And certainly the near-term huge Sequester US Government spending cuts will not help here.....just the opposite.

And since these larger US Broad-Based Manufacturing Corps are doing so poorly on an operating basis in the 1Q 2013, it is certain that the smaller ones are doing likewise, and probably even more so.

Don't get misled by the massive stock market upward move so far in 2013.  It's not about strong operating earnings in the 1Q 2013 because they are just not there.  It is all about the US Fed providing such low interest rates for an extended period of time, thereby making fixed income investments unattractive, coupled with the massive, incredibly lucrative common stock buybacks of large US Corporations, which buoys EPS and long-term EPS growth, the drivers of common stock values.  This was all explained in a post I made on March 20, 2013, which you can access in the below link:

Common Stock Buybacks: Main Cause of US Stock Market Sharp Ascent in 2013 

Below here is the Core Adjusted Earnings of each of these 36 US Broad-Based Manufacturing Corps for the 1Q 2013 and the 1Q 2012:

			Core	Core
	1Q	1Q	Adjusted	Adjusted
	2013	2012	Net	Net
	Core	Core	Income	Income
	Adjusted	Adjusted	Increase	Increase
	Net	Net	(Decrease)	(Decrease)
	Income	Income	Amount	%
	mils of $s	mils of $s	mils of $s
Broad-Based Manufacturing Corps
Motor Vehicle and Parts
Ford Motor	1,642	1,578	64	4%
General Motors	1,010	1,574	(564)	-36%
Paccar	236	327	(91)	-28%
Harley Davidson	224	172	52	30%
TRW Automotive	189	211	(22)	-10%
Chrysler	166	473	(307)	-65%
Borg Warner	152	158	(6)	-4%
Lear	124	141	(17)	-12%
Total all 8 Motor Vechicle & Parts	3,743	4,634	(891)	-19%
All Other Manufacturing
3M	1,129	1,125	4	0%
Honeywell	966	823	143	17%
Caterpillar	880	1,586	(706)	-45%
Deere	650	533	117	22%
Danaher	531	520	11	2%
Corning	445	397	48	12%
Illinois Tool Works	437	432	5	1%
Eaton	400	313	87	28%
CNH Global NV	326	269	57	21%
TE Connectivity	323	294	29	10%
Johnson Controls	287	378	(91)	-24%
Cummins	282	455	(173)	-38%
Parker Hannifin	257	312	(55)	-18%
PPG Industries	235	216	19	9%
Dover	192	188	4	2%
Rockwell Automation	189	173	16	9%
Stanley Black & Decker	163	165	(2)	-1%
Whirlpool	159	111	48	43%
Amphenol	142	127	15	12%
Joy Global	140	135	5	4%
Ingersoll-Rand	126	115	11	10%
Ametek	125	110	15	14%
Alcoa	121	105	16	15%
AGCO	118	120	(2)	-2%
Ball Corp	88	101	(13)	-13%
Nucor	85	145	(60)	-41%
Pitney Bowes	85	128	(43)	-34%
Timken	75	156	(81)	-52%
Total all 28 Other Manufacturing	8,956	9,532	(576)	-6%
Total all 36 Broad-Based Manufacturing Corps	12,699	14,166	(1,467)	-10.4%

Optimal Short-term Sequester Solution: Everybody Wins

The country has two major short-term economic problems.

First, the US economy flat-out sucks.  Not only are unemployment and underemployment so high, but also key US companies, across-the-board, are now reporting just horrible 1Q 2013 operating earnings, especially in the key manufacturing and technology sectors.  The companies reporting EPS increases are nearly all accomplishing this by using financial engineering.....substantially lowering their income tax rates and substantially buying back their common shares. 

And second, everyone admits that the way the sequester is working, it is grossly unfair to US citizens and to key US government programs.  And it is also very damaging to the US economy.

Here’s my solution for solving this horrible sequester in the near term, and to do it in such a way that both the Republicans and the Democrats can consider themselves winners.

The Republicans want the $85 bil sequester spending cuts to remain.  OK, leave all of them in, but have them done wisely, and also have them stagger in over the next say 10 years.

The Republicans also want no tax increase.  I have a way to solve that too.  Read further.

The Democrats want $42.5 bil in tax loophole closings.  OK, let them get that, but have them exactly offset with wise business income tax reductions of $42.5 bil which do the best at stimulating the US economy right away.  But focus on the most effective near-term US economy enhancing and US direct job creation initiatives like the following:

• giving smaller businesses a substantial payroll tax credit for substantial increases in organic payroll dollars, but with the requirement that these increases must also be retained for at least several years
• disallowing tax deductions for moving US jobs overseas and giving substantial tax credits to businesses for moving overseas jobs back to the US
• enhancing the R&D tax credit and also simplifying the way it is computed (R&D is predominately payroll expenditures)
• enhancing the domestic production activities tax deduction, but only for labor-intensive US manufacturing companies
• 100% tax expensing of equipment purchases for medium-sized US businesses which increase their full-time organic payroll counts and which also retain this increase for at least several years
• permit smaller and medium-sized US multinational corps to repatriate their foreign earnings at a somewhat discounted US federal income tax rate if they also increase their full-time organic payroll counts and also retain this increase for at least several years

On the other hand, the least effective new tax incentive is the payroll tax holiday, which is very expensive and does not directly create US jobs.

The end result is that the Republicans get their $85 bil of spending cuts and no tax increase.  The Democrats get their $42.5 bil of tax loophole closings. 
  

And more importantly, the US economy and US job creation benefit greatly from the near-term economic stimulus provided by not just eliminating the unsound, economic-damaging $85 bil of near-term sequester spending reductions, but also provided by the $42.5 bil of wisely-designed, directly targeted at US job creation business income tax incentives.