With shares of Toyota Motor (NYSE:TM) trading around $128, is TM an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let's analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
T = Trends for a Stock’s MovementToyota Motor is a Japan-based company mainly engaged in the automobile business and financial business. The company operates through three business segments: Automobile, Finance, and Others. Through its segments, Toyota Motor designs, manufactures, and sells vehicles as well as related parts and accessories; offers financial services related to the sale of its products; and is involved in the design, manufacture, and sale of housing, information, and communication businesses. Vehicles and related products are seeing increased innovation and Toyota Motor is at the head of this trend. Toyota has been dominating the competition and has been first to provide new technologies so look for the company to continue innovating.
Toyota is still the world's largest car manufacturer by volume, according to January-through-September sales data released by the Japanese automaker. Toyota beat out rivals General Motors (NYSE:GM) and Volkswagen (VLKAY.PK). Toyota's strong sales in the U.S. pushed the automaker to unload 7.412 million vehicles in the year to date. General Motors came in second, with 7.25 million vehicles, and Volkswagen sold 7.03 million cars.
T = Technicals on the Stock Chart Are StrongToyota Motor stock has been in a range in recent months. The stock is currently trading at highs for the year, but slightly below its all time high prices. Analyzing the price trend and its strength can be done using key simple moving averages. What are the key moving averages? The 50-day (pink), 100-day (blue), and 200-day (yellow) simple moving averages. As seen in the daily price chart below, Toyota Motor is trading above its rising key averages, which signal neutral to bullish price action in the near-term.
(Source: Thinkorswim)
Taking a look at the implied volatility (red) and implied volatility skew levels of Toyota Motor options may help determine if investors are bullish, neutral, or bearish.
| Implied Volatility (IV) | 30-Day IV Percentile | 90-Day IV Percentile | |
| Toyota Motor Options | 28.70% | 53% | 51% |
What does this mean? This means that investors or traders are buying a significant amount of call and put options contracts as compared to the last 30 and 90 trading days.
| Put IV Skew | Call IV Skew | |
| November Options | Flat | Average |
| December Options | Flat | Average |
As of today, there is an average demand from call buyers or sellers and low demand by put buyers or high demand by put sellers, all neutral to bullish over the next two months. To summarize, investors are buying a significant amount of call and put option contracts and are leaning neutral to bullish over the next two months.
On the next page, let’s take a look at the earnings and revenue growth rates and the conclusion.
E = Earnings Are Increasing Quarter-Over-QuarterRising stock prices are often strongly correlated with rising earnings and revenue growth rates. Also, the last four quarterly earnings announcement reactions help gauge investor sentiment on Toyota Motor’s stock. What do the last four quarterly earnings and revenue growth (Y-O-Y) figures for Toyota Motor look like and more importantly, how did the markets like these numbers?
| 2013 Q2 | 2013 Q1 | 2012 Q4 | 2012 Q3 | |
| Earnings Growth (Y-O-Y) | 55.77% | 113.50% | 9.74% | 213.10% |
| Revenue Growth (Y-O-Y) | -8.43% | -10.59% | -1.86% | 16.55% |
| Earnings Reaction | 6.41% | 3.12% | 1.04% | 4.36% |
Toyota Motor has seen increasing earnings and decreasing revenue figures over the last four quarters. From these numbers, the markets have been happy with Toyota Motor’s recent earnings announcements.
P = Excellent Relative Performance Versus Peers and SectorHow has Toyota Motor stock done relative to its peers, General Motors (NYSE:GM), Ford Motor (NYSE:F), Tesla Motors (NASDAQ:TSLA), and sector?
| Toyota Motor | General Motors | Ford Motor | Tesla Motors | Sector | |
| Year-to-Date Return | 37.69% | 23.17% | 35.52% | 381.8% | 33.12% |
Toyota Motor has been a relative performance leader, year-to-date.
ConclusionToyota Motor provides innovative vehicles and related products to consumers and companies worldwide. The stock has been in a range in recent months, but is currently trading at highs, slightly below its all time highs for the year. Over the last four quarters, investors in the company have been happy, however, revenues have been declining while earnings have been rising. Relative to its peers and sector, Toyota Motor has been a year-to-date performance leader. Look for Toyota Motor to OUTPERFORM.
Mark Bowden, Getty Images By the time most college graduates reach their 30s, they've been dealing with student loans for years. Yet increasingly, even 30-somethings still face big challenges from their outstanding college debts, and those challenges are affecting the way they manage the rest of their financial lives. Homeownership rates among 30-year-olds have fallen much more dramatically since 2008 for those with student loan debt than for those without it, according to a recent Federal Reserve Bank of New York study. Yet many people in their early 30s have either already started a family or plan to do so in the near future. That raises the question of how to balance your own financial needs against those of your children in order to reduce the odds that your kids will suffer under the crippling weight of excessive student loans of their own. Let's look at some tips for getting your own debt paid down and for preparing for potential family educational costs down the road. 1. Put Student Loans in Their Place. Many borrowers assume that they should always pay down their student loans as quickly as possible. Yet even though paying off those loans can give you a psychological boost, it's not necessarily the smartest move if you have other debt with less generous terms and higher finance charges. By understanding the terms of your student loans as well as credit-card agreements, car loans, mortgages, and other debt you might have, you can identify the highest-cost debt you have and prioritize getting that paid off first. Even if that means waiting longer to retire your student loans, doing so will still save you money in the long run. 2. Don't Skimp on Savings. Whether to put money toward savings and investing when you have outstanding student loan debt is a subject of debate, with good arguments on both sides. But to take advantage of the tax deductions and free employer-matching contributions you get from contributing to a retirement account, it's worth diverting extra money away from paying down student loans, especially those with low interest rates in the 3 percent to 4 percent range. As your income increases, you'll be able both to stay current on your loan obligations to set money aside for other important financial goals. 3. Make Your Employer Pay for More School. As you advance in your career, getting more education and boosting your skills might be a lucrative move. But once you're in the workforce, you don't necessarily have to pay for those classes yourself anymore. Many employers have recognized the value of investing in their employees through tuition reimbursement programs, which will pay you back for all or part of your costs. Availability and conditions differ from company to company, and typically, the education has to be connected to your job. But they're a great way to avoid adding to your student loan debt. 4. Don't Let Student Loan Debt Hit You Twice. As heavy a burden as today's young graduates carry, educational debt among their parents is also reaching epidemic levels. In 2011, parents received $10.6 billion in Parent PLUS loans, a 145 percent increase since 2000, even adjusted for inflation, according to a study from The Chronicle of Higher Education and ProPublica. And the size of average individual loan is up as well, by about a third to nearly $12,000 in constant dollars. If you have kids or plan to, you'll want to take steps to ensure you don't end up facing a huge loan burden a second time around. Put time on your side by setting up savings programs for their college educations now. As your income grows and you rise into higher tax brackets, the advantages of using a tax-favored college savings strategy such as a 529 plan increase in value. As with any market-based investment and saving strategy, 529 plans work best when you give them as much time as possible to produce strong returns. Moreover, 529 plans have very small minimum starting investments, so you can start a account without placing too big a burden on your finances.
Alamy Sorry, recent college grads: That mountain of student loan debt you have to scale is going to delay your retirement by more than a decade. That's the conclusion of an analysis by personal finance site NerdWallet, which looked at the dismal financial state of today's average college graduate. With a median debt load of $23,300, a 10-year repayment plan and an unemployment rate of 18 percent upon graduation, new grads aren't exactly set up to start socking away retirement funds. It all translates to about $115,000 less in your retirement fund by the time you hit the typical retirement age. So how does $23,000 in college debt now wind up costing you $115,000 later? It's partly a matter of interest on the loan, which winds up costing the typical grad an additional $5,000 or so by the time the debt is repaid. But the real issue is opportunity cost. "[A]lthough the median college graduate leaves with a seemingly manageable $23,300 debt load, 7% of a student's earnings go toward yearly loan payments of $2,858 for the first ten years of his or her career," writes NerdWallet analyst Joseph Egoian. "This prevents any meaningful contributions toward retirement." Now, if that $28,580 being doled out in loan payments instead sat in a plain-vanilla retirement account averaging a 5 percent annual return for 33 years, it would become more than $143,000. But it won't, and as a result, the typical debt-laden college graduate won't be well-situated to retire until he or she is 73 -- a good 12 years later than the current average retirement age. Even with a projected life expectancy of 84, that's still only a decade of retirement to enjoy. Later retirements are somewhat inevitable, even in the absence of exploding student loan debt -- as medical science extends our lifespans, you'll have to work longer simple give yourself a shot at not outliving your money. That's why it's more important than ever to contribute as much as possible to your retirement accounts and take full advantage of any employer matching you can get on your 401(k). Even with tuition growth starting to slow, it's tough to avoid graduating college with a heavy debt load. But you don't have to follow the crowd into a seriously delayed retirement: Being smart about your education can help you get there right on schedule.
If you are concerned that the month to month graph might not be indicating day to day volatility in the market, this graph should set that fear to rest: 
Some analysts have pointed at the increase in the T.Bill rate as evidence of market concern about default and there is some basis for that. 
The one-month T. Bill rate has climbed from zero in mid-September to 0.35% yesterday. However, note that the US T.Bond rate actually declined over the same period, again indicative that if there is a heightened sense of worry about default with the US Treasury, it is accompanied by a sense that the default will not last for long and will affect short term obligations by more. Valuation Implications What are the implications of heightened default risk in government bonds for risky assets? In the immediate aftermath of the 2008 crisis, I worked on a series of what I call my "nightmare" papers, where I took fundamental assumptions we make about markets and examined how corporate finance and valuation practice would have to change, if those assumptions were not true. The very first of those articles was titled, "Into the Abyss: What if nothing is risk free?" and it looked at the feedback effects of government default into valuation inputs. You can download the paper by clicking here, but I can summarize the effects on equity value into key macro inputs that affect the value of every company: 1. Risk free rate: How will a default or a heightened expectation of default by the US government affect the risk free rate in US dollars? It is tough to tell, but my guess is that the risk free rate in US dollars will decline. That may surprise you, but that may be because you are still equating the US treasury bond rate with the risk free rate in US dollars. Once government default become a clear and present danger, that equivalence no longer holds and the risk free rate in US dollars will have to be computed by subtracting out the default spread for the US from the US treasury bond rate. Thus, just as a what if, assume that there is default and the US T.Bond rate jumps from 2.60% today to 2.75% tomorrow and that your assessment of the default spread for the US (either from a newly assigned lower sovereign rating or the CDS market tomorrow) is 0.25%. Risk free rate in US dollars = 2.75% - 0.25% = 2.50% 
If you go along with my estimates, the US $ risk free rate has dropped from 2.67% to 2.42% over the last 30 days, while the default spread has widened from 0.19% to 0.28%. 2. Equity Risk Premiums and Corporate Default Spreads: Lest you start celebrating the lower risk free rate as good for value, let me bring the other piece of the required return into play. If the default risk in the US is reevaluated upwards, it is also very likely that investors will start demanding higher risk premiums for investing in risky assets (stocks, corporate bonds, real estate). In fact, I think that the absence of a truly risk free alternative makes all risky investments even riskier to investors and that will show up as higher equity risk premiums. The same argument can be applied to the corporate bond market, where default spreads will increase for corporate bonds in every ratings class, as sovereign default risk climbs. To get a measure of how equity risk premiums have behaved over the last month, I can provide my daily estimates of the implied ERP from September 16 to October 16 for the S&P 500. 
Note that I have computed the implied ERP over my estimated US$ risk free rate (and not over the US T. Bond rate). You can download the spreadsheet and make the estimates yourself. The net effect on equity will therefore depend upon whether equity risk premiums (ERP will increase by more or less than the risk free rate decreases. If default occurs, the ERP will increase by more than the risk free rate drops, which will have a negative effect on the value of equity. However, that effect will not be uniform, with the negative impact being greater for riskier companies than for safer ones. The End Game By the time you read this post, I would not be surprised if Congress has stitched together a last minute compromise to postpone technical default to another day. In a sense, though, it is too late to put the genie back in the bottle and while it is easy to blame political dysfunction for this debt default drama, I think that it is reflective of a much larger macro economic shift. With globalization of both companies and markets, even the largest economies are no longer insulated from big crises and in conjunction with the loss of trust in institutions (governments, central banks) over the last few years, I think we have to face up to the reality that nothing is truly risk free any more. That is the bad news. The good news is that the mechanism for incorporating that shift into valuation and corporate finance exists, is already in use in many emerging market currencies and just has to be extended to developed markets. 
) announced that it has signed a definitive agreement to divest its global Polypropylene Licensing & Catalysts business to W.R. Grace & Co. for a sale price of $500 million.
Getty Images On Oct. 1, millions of uninsured Americans got their first chance to sign up for the health insurance exchanges that the Affordable Care Act created. Yet in all the attention that the new Obamacare exchanges have received, another important event for health care coverage has largely gone unnoticed -- even though it potentially affects even more of the American public. More than 50 million Americans are eligible for Medicare according to the Department of Health & Human Services, and every year, Medicare participants get a chance to choose or make changes to their existing coverage options under the program. With the annual open enrollment period running from Oct. 15 to Dec. 7, those eligible for Medicare -- typically Americans age 65 or older -- need to be prepared to make smart choices about their coverage. Here are three things you should know in helping you make your decision. 1. Obamacare Open Enrollment Is Entirely Different From Medicare Open Enrollment. One major source of confusion among Medicare recipients comes from the fact that the inaugural open-enrollment period for Obamacare is happening at the same time. However, if you're eligible for Medicare, you won't get your insurance from an Obamacare health insurance exchange, and if you visit the exchange websites, you won't find Medicare as an option. Moreover, the insurance policies you will find on the Obamacare health insurance exchanges won't be appropriate for Medicare recipients, as they won't take Medicare's provisions into account. Instead, the Medicare website is the best place to start in signing up for Medicare or choosing a new coverage plan. There, you'll find detailed information to help you learn more about your available options and find out about the various plans that are available to you. 2. Changing Plans During Open Enrollment Can Be Especially Smart If Your Health Has Changed. One of the most important aspects of Medicare open enrollment is that it allows Medicare recipients to tailor their coverage to their particular needs. Although traditional Medicare Part A and B coverage doesn't involve much decision-making, prescription drug coverage under Part D gives Medicare recipients many different choices. Some Part D plans offer comprehensive coverage of prescription drug costs but at higher monthly premiums, while other Part D plans have much lower monthly costs but don't pay for as much of your potential prescription-drug expenses. If your health hasn't changed much during the past year, you might well find that your existing Part D coverage still suits your needs and therefore won't need to make major changes. But if your health has changed markedly, requiring you to take new prescription drugs, looking at other Part D plans might save you money. Paying higher premiums might actually reduce your overall costs if a new plan covers more of the out-of-pocket costs of obtaining your prescriptions. 3. Understand the Medicare Advantage and Medigap Coverage Options. Another source of confusion for Medicare recipients involves the difference between traditional Medicare, Medicare supplemental insurance, and Medicare Advantage plans. Traditional Medicare covers you for medical services from any provider that accepts Medicare, but it doesn't cover all of the costs of those services. In order to cover the rest, those who have traditional Medicare can get Medicare supplemental insurance from third-party insurers, with policies designed to fit Medicare's broad coverage. On the other hand, Medicare Advantage plans often take the place of traditional Medicare coverage, with many plans offering both medical services and prescription-drug coverage in one package. Medicare Advantage plans often involve networks of physicians through health maintenance organizations or preferred provider organizations, so you might not have as much flexibility to choose whatever doctor you like. Assessing the cost differences can be complicated, but the right choice can nevertheless produce substantial savings. Make the Smart Choice It's easy to let Medicare's open enrollment period pass you by without a thought, especially if you've largely been happy with your existing coverage. But this is the only chance during the year you have to assess what you're spending on health expenses, so taking the time to see if a new Medicare coverage option would save you money is well worth the effort.