Question:
I’m looking at Terex Corp based on a tip. I don’t know much about the company. I’m more familiar with bigger names like Caterpillar and John Deere. I was told Terex could be a good mid-cap play.
Answer:
Terex Corp. (NYSE: TEX) is a global equipment manufacturer of machinery products, for construction and mining. Terex is a lower quality name in the industry as it carries a C++ rating for Financial Strength from Value Line. The company has been earning less than its return on capital, which is an indication the company is taking on debt to stay alive. The outlook is not all that great for the company. We recommend you avoid Terex and opt for Deere & Company (NYSE: DE) or Caterpillar, Inc. (NYSE: CAT) in the heavy machinery industry.
Question:
I own National Presto. The stock just hasn’t performed this year. I was thinking of selling at the end of the year for a tax loss. If I were to stay with a small-cap Consumer Discretionary, where would I go?
Answer:
National Presto Industries, Inc. (NYSE: NPK) manufactures a variety of products including small appliances and 40 millimeter ammunition. Additionally, shipments on their small appliances are down 22%. We recommend selling the stock now, rather than waiting until the end of the year.
We recommend Bed Bath & Beyond Inc. (NASDAQ: BBBY), which is a Large-Cap play at $13 billion. The stock is down, which makes it a good time to buy in our opinion. We believe it would be better to own the store that sells National Presto products as well as its competitors. Bed Bath & Beyond is also competitive with online retailers as far as prices go.
Question:
I am married and my wife has not been working in order to stay home with our daughter. I participate in my employer’s 401k plan, so I will not contribute to an IRA for me, but we would like to make an IRA contribution for my wife. We will file jointly this year and our AGI will be around $110k. We are both under 50. Can I make a spousal IRA contribution to an IRA she set up when she was working or do we have to open a new account?
Answer:
Yes, under spousal IRA contribution rules, you are allowed to make an IRA contribution of up to $5,500 for a non-working spouse who’s married to a working spouse with access to a company retirement plan.
Since you are covered by a qualified retirement plan at work, are married and file jointly in 2014, and your modified adjusted gross income is less than $181,000 you will receive a full deduction for this contribution.
You should be eligible to contribute to your wife’s existing IRA, but you may want to consider setting up a new Roth IRA, this is something you should discuss with your investment advisor. Your income is under the income limit of $181,000, so you may make a full contribution a Roth.
If you have questions regarding your financial strategy, the experts at Henssler Financial will be glad to help:
- Experts Request Form
- Email: experts@henssler.com
- Phone: 770-429-9166.
Disclosures
This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
