I have always felt that for all the blabbing we do -- or blogging, in my case -- we should try as best we can to be accountable for our good and bad calls. This report is long overdue, but I will post it anyway since all of my past year's picks and results have been made public.
The market was very harsh in the early part of 2009, filling investors fear and trepidation, and sinking to a March 9, 2009 bottom. Perhaps some of the bleeding has stopped, but the economy has not healed as bears and bulls seem to carry the day, or every other day.
Continue reading Chasing Value™: 2009 Results Crushed the S&P 500
The following article was contributed via Seed.com, AOL's new platform for freelance writers.
Warren Buffett is one of the few investors in the world that has consistently succeeded where others failed. Part of his success is due to his common sense approach to the stock market. Investors have mocked Buffett for his old fashioned approach to investing when he sat out the dot com era bubble. But Buffett had the last laugh when others lost out during the bust.
Buffett also managed to largely avoid the major losses investors faced when they invested in securities dependent on subprime lending practices. In fact, he managed to profit from it.
Here are some principles Warren Buffett follows and investors would be wise to model:
Continue reading Why You Should Invest Like Warren Buffett
During my tenure at BloggingStocks I have expressed my opinion often about the contribution that dividends make to your overall return. Most shrewd investors, and especially "my pal Warren," know this and understand why I re-emphasize the point when I make my annual selections.
By now I hope you have had a chance to peruse my picks for 2010. If not the links below will give you another opportunity.
Continue reading Chasing Value: 2010 Dividends for Ten Stock Picks
For the first time my annual picks will include a stock option. I have written numerous blogs this year about something called "naked puts" -- that is a sell to open put position -- committing me to buy a certain number of shares by a certain date if the closing price is less than the strike price.
In this case I have selected the E*TRADE (ETFC) January 2011, $2.50 puts last traded on December 28, 2009 at $0.97 for a 39% return. If it expires, as I am betting it will, by the third Friday of that month I have no further obligation.
This type of option transaction is not available to most investors. It is marginable, but you pay no interest.
Continue reading Chasing Value: 2010 -- #10 E-Trade 'Naked Put'
To arrive at this years ten picks I scoured business journals and editorials, online and off. I also ran through a series of stock screens repeatedly over the last few months filtering for five primary value metrics identifying stocks worthy of further consideration.
The 5 data points were price-to-sales (P/S), price-to-book (P/B), price-to-cash flow (P/CF), dividend yield and return-on-equity (ROE). I did look at other things but these were the subject of my initial focus.
Continue reading Chasing Value: 10 Stock Picks for 2010
"We include Price Small Cap Value (PRSVX) in all five of our Master portfolios as well as our Best Buy model portfolios," says Mark Salzinger.
In his The No-Load Fund Investor, the fund expert suggests, "Overall, we consider this fund to be an excellent core holding for small-cap exposure." Here's his bullish overview.
"The fund lost just 28.6% in 2008, vs. anearly 37% loss for the average small-cap-value fund. In 2009, though, that has reversed a bit: Price Small Cap Value has gained 19.6% to its average peer's 22.7% gain. Two reasons for the sluggish performance this year are rooted in the fund's basic composition.
Continue reading Finding value at Price Small Cap Value Fund (PRSVX)
Yesterday my 2009 portfolio closed up 201% for the year. It has been an interesting journey, and while it is rather self congratulatory to discuss it, there are lessons to be learned.
Before I review some of the reasons I was able to do this I want to make it clear that I do not think this can be easily repeated; I look at the portfolio every day thinking this is too good to be true, and we all know what that usually means.
Continue reading Chasing Value: Journey to 201%: APC, ISRG, WFC and more
) will have to create a section for surfboards and snakebite kits to accommodate the customers they hope to gain in Australia by investing in pawn shop operators, Cash Converters International Ltd.
The Texas based pawn shop and check cashing company invested $45 million for a 30% stake
in the Cash Converters getting two seats on the board and making a grand leap half way around the world. Just last year they bought outright a Mexican company, expanding their North American operations.
Last December EZCorp was included on my list of nine suggestions for 2009. Since that time it has remained one of the two laggards. I still believe in the company that continues to expand, using its own cash as it maintains a very low level of debt.
Continue reading Chasing Value: EZ-Corp's Australian move
You can learn a lot from your elders and when it comes to investing, you best listen very attentively. I often refer to 'my pal Warren'
in my posts and I credit Mr. Buffett's investment advice and parables over the years for much of my gains in 2009.
There is another mentor, though, one I have not referred to often but that I have gleaned some wisdom from in terms of value investing and courage, and that is 'my pal Sir John
.' While Buffett has been very straight forward in his position that you should buy on fear and this was the year to do that, it was Templeton that preached buying far and wide and diversifying broadly into out-of-favor companies. As he did when he started out.
Continue reading Ford, Citi, MBIA, GBE and Sir John Templeton
"A focal point of China's ambitious $586 billion stimulus package will be railroads; in fact, investment in railways has already tripled over this time last year." explains value Investor Nathan Slaughter.
In his Half-Priced Stocks he adds, "Guangshen Railway Limited (NYSE: GSH) looks to be an obvious choice to benefit from this trend. Indeed, pricing flexibility, stellar efficiency and utilization has made Guangshen the most profitable rail company in China."
"Growth in China's railways doesn't come as a surprise. Years before this plan was put in motion, China already had bold ideas about building out its railway system -- and was bankrolling those ideas with about $200 billion in government cash.
Continue reading Guangshen (GSH): Riding the rails in China
In his Validea newsletter and his just published book Guru Strategies, stock advisor John Reese assesses companies based on the investment strategies of "legendary investors" such as Ben Graham and Warren Buffett.
Recently, the advisor has highlighted two retailers that pass his guru screens: Gildan Activewear (NYSE: GIL) and Jos. A. Bank Clothiers (NASDAQ: JOSB). Here's his contrarian look at the two out-of-favor firms.
"You might never have heard Gildan Activewear, a Montreal-based clothing manufacturer, but you may well have worn its products. Gildan sells T-shirts, sport shirts and fleece to wholesale distributors as 'blanks' -- that is, without logos or decorating. Screen printers then decorate the items with various designs and logos.
Continue reading Guru strategies pick apparel retailers
"PepsiCo (NYSE: PEP) Pepsi is about as dependable a company as there is and the stock would be an excellent anchor for most portfolios," says value investor Nathan Slaughter.
In his Half-Priced Stocks, he says, "All told, PepsiCo has built an impressive lineup of 18 brands that each generate more than $1 billion in annual sales."
"Long ago, management realized that carbonated drink sales would fizzle out and per-capita consumption would become sluggish. In their place, bottled water and sports drinks became two of the fastest-growing categories. And Pepsi is the dominant player in both, with its Aquafina and Gatorade brands.
"Meanwhile, energy drinks have emerged as the industry's hottest segment -- with sales soaring from $1.2 billion in 2002 to more than $6.6 billion last year. Again, Pepsi is well-represented with Amp.
Continue reading PepsiCo (PEP): A portfolio anchor
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