Warren Buffett Stocks (II): Eaton Corporation, Gannett, General Electric, GlaxoSmithKline, Home Depot, Ingersoll-Rd Company, Iron Mountain, Johnson & Johnson, Kraft Foods, Lowes

Eaton Corporation (ETN, Financial)Â - previous stock valuation

Gannett (GCI, Financial)

General Electric (GE, Financial)

GlaxoSmithKline (GSK, Financial)

Home Depot (HD, Financial)

Ingersoll-Rd Company (IR, Financial)

Iron Mountain (IRM, Financial)

Johnson & Johnson (JNJ, Financial)Â

Kraft Foods (KFT, Financial)

Lowes (LOW, Financial)

Electrical - electrical systems and components for power quality, distribution and control

Hydraulics - fluid power systems and services for industrial, mobile and aircraft equipment

Aerospace - intelligent truck drivetrain systems for safety and fuel economy

Automotive - automotive engine air management systems, powertrain solutions and specialty controls for performance, fuel economy and safety.

CROIC has been amazing past 10 years.

Management is doing a great job of using its cash.

Plenty of FCF

Debt level has been the same past few years

8c from every dollar of sales converts down to the bottom line

Good margins prove the business can make money during a hard recession

Regression of earnings compared over multiple time frames is flat meaning that growth is coming from other than organic business. Shown by the goodwill balance which I also discussed in the previous ETN stock valuation.

Current Price:Â $55.06

DCF Stock Value:Â $76.42

Graham Stock Value:

0% growth =Â $52.65

7% growth =Â $134.53

Competitor and Peer Comparison:Â Fairly valued

Horrific year in 2008Huge impairments of goodwill and PP&E

Printing equipment would also be of little value if resold

Totally contrarian investment

Declining sales since 2006 and so has earnings

Amazing CROIC despite performance.

Excellent managementBusiness operations can generate FCF

Declining capex

Current Price:Â $8.17

DCF Stock Value:Â $30.47 @ 0% growth

Graham Stock Value:

0% growth =Â $33.21

Competitor and Peer Comparison: Print and media industry shunned by The Street and looks undervalued.

Plenty of cash from all of its operations

High debt ratio and increasing past 2-3 years

Average CROIC of 3%FCF/Sales is pretty good at 8%

Stable inventory turnover in line with past 10 years

Maybe a good company but not great

Current Price:Â $14.20

DCF Stock Value:Â $15.64 @ 5% FCF growth

Graham Stock Value:

0% growth =Â $43.89 @ 8% EPS growth

Competitor and Peer Comparison:Â $18.75

Lots of FCF but slow growth

Excellent CROIC above 30%.

Able to make returns of over 30% from their use of cash.

Pharma companies also are able to drop the sales figures directly to the FCF line

High margins and returns as expected from drug companies

Big drop is tangible shareholders equity due to goodwill from acquisition activity

Current Price:Â $39.44

DCF Stock Value:Â $43.79 @ default 6.5% FCF growth

Graham Stock Value:Â $30 - $60Â depending on pipeline

Competitor and Peer Comparison:Â $32

Struggled with the housing bust

Low growth

Slowed down opening new stores dramatically if you look at capex further

Plenty of FCF

Average CROIC, FCF/Sales, Revenue growth, earning growth

Current Price:Â $27.03

DCF Stock Value:Â $27.23 @ default 5% FCF growth

Graham Stock Value:Â $26.39

Competitor and Peer Comparison:Â $25

Air Conditioning Systems and Services

Climate Control Technologies

Industrial Technologies

Security Technologies

Big increase in goodwill in 2008

FCF positive yet erratic at times.

Median of 11% FCF growth

Excellent CROIC.

Buffett sure does a good job of picking effective management at the helm

Consistency in ROA and ROE when looking at multiple timeframes

Revenue growth on the low side

Current Price:Â $30.94

DCF Stock Value:Â $20 @ default 11%FCF growth adjusted

Graham Stock Value:Â $51.30

Competitor and Peer Comparison:Â Fair to slight premium

Lost more FCF than it made throughout the past 10 years

None or very low FCF growth, CROIC, returns

Steady increase in sales but can’t convert it to FCF

Current Price:Â $29.39

DCF Stock Value:Â N/A

Graham Stock Value:Â $20.79 @ 13% growth rate

Competitor and Peer Comparison:Â $13.40

Current Price:Â $61.28

DCF Stock Value: $70.27. Not much different than the $71 I got last time.

Graham Stock Value:Â $109.84Â compared to $108 previously.

Competitor and Peer Comparison:Â Fairly valued compared to competitors

Margins decreasing for more than 7 years straight

Inventory turnover has been improving

No FCF growth

Makes 22c of every $1 invested (CROIC=22%)

Growth is minimal

Increasing debt

Current Price:Â $28.40

DCF Stock Value:Â N/A

Graham Stock Value:Â $19.96

Competitor and Peer Comparison:Â $24

Better growth opportunity that Home Depot

Good FCF growth but CROIC is very low at 2%.

Better than nothing but not effective with utilizing capital.Good revenue and earnings growth

Gross margins increasing to date

Debt down to average levels

Tangible book value increasing

ROE and ROA declining past 2 years

Sales flat since 2007

The macro idea that people will continue to repair and improve houses still doesn’t work well in a recession.

If I had to choose LOW or HD, I would go for LOW. Or be like Buffett and get both.

Current Price:Â $20.72

DCF Stock Value:Â $18.91

Graham Stock Value:Â $52.66

Competitor and Peer Comparison:Â $22