Top 5 Stock Picks

[QuikSand]

Hecla Mining got totally buried yesterday on news of a refinancing deal, and is again in a great buy-low territory. Since this has become a public pick of mine, I'll confess that I'm already (too) long on HL, but I feel I understand what their business is all about -- and shares under two bucks is just silliness. It opens at 1.83 today, it likely closes the day over 1.95, and in a month it has an excellent chance to be back to 2.40 or so.

[SportsDino]

Okay, this goes against the spirit of the game, and my personal rules, but I feel bored.

I'm a dirty, dirty short term player, but I currently am running one of my patented crazy short/long games on WalMart. Now the news is already out of the bag about january sales and what not, so it may not be the best time to jump if your worried about short term... but anyway I figure a long term stable price on WMT to be 55 (my definition of stable and price target may differ from the entire world, so be wary).


So anyhoo, at a price of $46.5 on Monday (2-2) that puts me at a 18% (selling at a price over 55, obviously this does not include fees).

Against the spirit of things, I fully intend to sell the majority of my position, probably at 20%... and then buy back again if the price falls to where I like it. I loves me volatility and am a shameful gambler (I take risks buying it at sub-47 that it will go up to 55, and i take risks of selling at 55 although it may potentially rocket up to 75 for all I know... but bonus points to anyone who can tell me why I might prefer such a system to buy and hold at $47).

BTW, I'm perfectly fine holding on to this if it doesn't hit my target or even falls below 46.5, so while I'll lock in my gains short term if I have any, I am playing under a sort of long assumption that the value will be at 55 within a reasonable time horizon for my 46.5 investment.

As with all information in this thread, do your own due diligence, and feel free to bash the hell outta anything (you might uncover a nugget my poor artificial toys missed). Please do not consider this as anything more than a crazy ass piece of speculation in a game, as I am not a financial advisor of any kind! Caveat emptor! Beware of economic downturn! Etc.... I think that covers my responsibility as far as saying 'please don't take what I said and lose money because of it'.

[Tekneek]

So, what is your system, SportsDino? Anything similar to Phil Town's philosophy? I used to do all the work involved with that, and before that played around w/ the Mad Money madness.

[sterlingice]

I hear it goes something like this

Front Office Football Central - View Single Post - Ping: Blackjack Players

SI

[SportsDino]

I don't know what the Phil Town or Mad Money system is. Most of my gimmicks are my own invention, although they may be similar to other people's designs. The most accurate term to describe me according to most folk I've talked with is 'insane'...

I'll try and look up what those systems are and see if I come close to em. If you have a link to your preferred definition that would help.

[SportsDino]

Reading this page which seems to be a review:
Phil Town’s Rule #1 Investing ∞ Get Rich Slowly

Not quite what I do.

Things that are similar:
- set a price
- buy and sell the volatility around that price (as in get in when its under price, and lock in profit once it has gained X%)

Things that are not:
- disagree about some of his assumptions, such as 'not being an expert', or using tools to make decisions.
- disagree about how he evaluates companies, although those metrics may be useful, each company really is its own story and has its own relevant numbers.
- any sort of automatic repeated process. Each time I rebuy a company I have made a unique decision to do so, and many times if I feel I don't have a grasp on whats next I move on and count the coin I made.


Anywho, this is just one strategy among those I use. I should state that a relatively small portion of my portfolio is in this and I'm a big fan of diversifying. My primary difference in how I treat risk on these speculative and long plays is that I sometimes assume volatility and cash in short term gains rather than risk a downslide.

I sometimes miss out on continued growth in the stock price if timing is wrong, but I don't play the 'woulda coulda shoulda' game, as I feel that will just encourage me to overplay things. Watching a large farm of stocks there usually is always one that is down on volatility that is due for reevaluation anyway... so I've been fortunate that most of the time I'm locking in a +10-20% (after costs), transitioning to another pick that goes +10-20%, and after a while some bad news has sent my original target back down again so I can decide whether I want to get back into that.

Requires a lot of active involvement, and I should stress that I often 'cash out' portions of that speculative style of play into a pure long portfolio with all those friendly bonds, index funds, mutual funds I researched the components of, even some CDs and lower rate accounts. Also stocks, for instance some portion of this WMT buy will probably stick around, I've got FUN in there, and a bundle of others.

Also I do have losers as well, and most of my speculative plays are red for the majority of their lifespan until they hit that green spike where I auto sell them. For this reason it is very rare that any one of them get very large, although I have knowingly made a rare big gamble once in a while.

[Flasch186]

tough to scale into a stock, say like GE, when it jumps 10% 3 days after entry. pfffft, who's complaining, Im so used to them going down after I enter that I should be happy anyways.

[SportsDino]

Sucks that GE is even considering playing with its sexy dividend (1.24 on any 12.64 is 10% year on dividend, of course such a ratio is unlikely to last).

I've had a chunk of them since November (some recall or something another drove the price down and I picked it up against the trend). Sold most of it at 18, but as is my custom I kept a chunk for my longs. Recently back in them with another chunk (split over two purchases at 11.5 and 11). Be wary of the dividend situation, even if it is not going to be cut for a while and it is still healthy after the cut, if the price has recovered to somewhere nice (say over the unlikely 18) the rumor or re-entry of the factoid into the news cycle can yoyo the price again. I personally plan to jump like the silly chicken I am if it spikes up, again selling the majority although steadilly growing my long share of it.

Long term though, barring uncovering anything ultra bad, its certainly going to be involved in any economic upswing.

[Flasch186]

but to keep the bond rating for that particular company is more important, IMO. Hence my concern over that when I mentioned it and not a cut of it's dividend. That being said, im in so minimally that Im kind of at a loss as to what to do now. The likelihood of scaling in has diminished quite a bit so I may just dump out....I dont know. I like more beta and more cash on the books, hence my overweight in tech. However, im an idiot, and lost a bunch of money last year while talking about strategies that couldve helped me make money or at least be even.

[Flasch186]

hehe, maybe scaling in is still in the cards after all

[lighthousekeeper]

ugh...last time i take investing advice from a sports sim messageboard.

[Flasch186]

losing a little is the new winning.

[Edward64]

What do you guys think about Citigroup now that (I assume) everything has come out? The chances for nationalization is much less with the big upfront investment?

[sterlingice]

Originally Posted by Edward64

What do you guys think about Citigroup now that (I assume) everything has come out? The chances for nationalization is much less with the big upfront investment?

Frankly, I'm pissed since if we were going to invest that much in them, it should be a 51% stake and clean house. This was a stupid move- but this probably should be in a POL thread.

That said, it does decrease the short term chance of them being nationalized significantly so the door is probably open for some short term gains if any are to be had. However, their balance sheets are a mess so it's not that hard to see situation where they are still nationalized 6 months down the road because their situation continues to deteriorate.

SI

[SportsDino]

I would strongly suggest not taking advice from a sports sim message board!

[SportsDino]

I will say Citigroup is a hot potato, if your a gambling man or have a solid research lead, go ahead and play... I'm starting to think it might be good to have a pet politician or two to predict that one.

[sterlingice]

Originally Posted by SportsDino

I will say Citigroup is a hot potato, if your a gambling man or have a solid research lead, go ahead and play... I'm starting to think it might be good to have a pet politician or two to predict that one.

Yeah, if you were a fly on the wall and knew what Geithner/Obama were going to do with it, you could make a killing one way or another either shorting as they zeroed it out or buying into a giant bank at $2 per share and holding until healthy. I mean, really, would you be surprised if in 5 years it was at $40 per share and you made back 20x your money (I mean think about that- you could turn $50K into $1M)?

SI

[SportsDino]

The only reason you have an opportunity of 20x growth though of course is related to the probability of zero-ing out. I can't begin to understand Citigroup's books, and believe me I tried. I knew enough to short them (and BAC) when they were 5 to 10 times what they are now (well I shorted them a few times each, yay evil short monster). But like I said after my last liquidation of BAC... they are so low in share price that even I am getting weary to short them with any serious money anymore. I do make small gambles using SKF/SDS, but always short term and always with an 'oh fuck' exit strategy, and small enough amounts that I can handle it.

So I don't feel as qualified to make a guess as when I was betting house sized (well 2008 prices anyway ) chunks that there was more bad news to come. Basically I was just practicing what I preach though, if I say we were printing money and bailing out to obfuscate serious problems in the banks who have continued bad leadership and bleak outlook, then of course I should put my money where my mouth is and put money on where I think the truth will take us (a continuation of the short term slide in banks). I will admit though with some of the banks, particularly the ones I think will become the evil merger monsters of tommorrow, that I'm playing with buy bets. I'm not so much timing the bottom as still being in the process of calculating whether or when there will ever be an upswing. I've got the money now to sit on some red ink for 2 or 3 years if I know for a fact that the company is not going to go completely under and will be part of a real recovery (not a looks good on paper recovery either).

[flere-imsaho]

Originally Posted by Edward64

What do you guys think about Citigroup now that (I assume) everything has come out? The chances for nationalization is much less with the big upfront investment?

I still think Citigroup is the weakest of the Big Three, with BoFA in the middle and JPM Chase the strongest. For relative values of "strong".

[lighthousekeeper]

Originally Posted by QuikSand

Here's a quick stab at things. Not getting on top of the mountain and predicting what's going to happen with everything... just picking a few stocks, that's all.

Caterpillar (CAT)
Hecla Mining (HL)
Cedar Fair (FUN)
Woodward Governor (WGOV)
Cynosure (CYNO)

doh. % change since pick.

[QuikSand]

Yeah, I have had a pretty tough run with these stocks. I'm actually going even longer in a couple since the price drops (like Hecla) but overall I have been taking a bath (well, I don't even own any CYNO, I just though it was an intriguing spec play...and I didn't own CAT when I posted my interest, though I have bought some since and lost on it). Of course, I'm not really in any of those companies to sell right away anyhow, so the six-week return isn't really my main focus... and since I do have a fair amount of cash on the sidelines, I'm still okay seeing more value open up for more buying opportunities.

I'd still shill HL to just about anyone who would listen. There's a good deal of noise about this company "diluting" their stock, but they issued stock to buy more mines -- that's not exactly a dilution. Bottom line is they own property on which there are marge deposits of valuable minerals. To me, that's a lot more tangible that "we're the company who makes these funny shoes that happen to be selling well this season." I think long term, metals/mining are not a bad play, and this company has been unfairly punished in the euity markets.

Sorry if you actually made investments based on my speculation (I'm mostly in with you there, if so) but I'm still fairly bullish on most of these picks for the medium to long term, which was the game we were playing, after all.

[SportsDino]

You can select any number of stocks and the vast majority are down right now. There is plenty of damage occurring, but I think the original game is to find ones that you assume will recover... not to time their bottom.

The only ones I have played in publicly:

FUN - Down, down, down... but like I said everyone is all in a panic, and they are considering cutting their dividend and they just made a massive acquisition (with a lot of debt). Probably will continue being red until they outright announce how much they are going to cut the dividend, and like GE there will be probably initial continued downsliding until people realize the yield of the new dividend is still reasonable, and it stabilizes. As for the debt, I think they'll survive it, and out the other side they have yet another park to increase their revenues. To me its a potential bouncer. I'm averaged at (11) in it.

WMT - Is up from my buy price (46.5), standard price shocks on every bit of market news, but enough realization that it is not going away anytime soon.

GE - Up from my averaged price (7.5??? not sure would have to go calc it). Granted I got in starting at 11. Again, another situation where the economic situation is dragging everything down, even the rumor of trouble in GE's financial units is enough to cause chaos. And the recent dividend cut was also factored into that drop. Again, the company is not going anywhere, and its another candidate for a recovery bounce.

I still advise against taking the advice of anyone on this board, especially me! However, you will have a hard time finding a portfolio that is not red at the moment. Also I've noticed a slight bias in my own news mongering that companies that are not acting like its the end of the world and are retaining jobs/growth options (or potentially preparing for expansion), are often getting punished by the market. Right now when things are dirt cheap is when you want companies buying up assets and other companies... I always laughed at the fools thinking they are doing a great job with mergers during the good times at companies bought for their peak value... its easy to look good when everyone is drinking the same kool-aid, but real business and growth often happens in the rough red, not in the gaudy green.

[lighthousekeeper]

Originally Posted by SportsDino

I still advise against taking the advice of anyone on this board, especially me!

You mentioned this before, but where else can I get advice without spending any money (i.e. financial advisor, which I won't do unless they can provide a money-backed guarantee that they can outperform this messageboard) or time (i.e. researching on my own).

[Flasch186]

Im the same on GE, last buy at $5.99/share BUT who the hell knows whats going to happen but I feel confident in all of my holdings outside of my 'planned' speculative play, that they wont go out of business anyways.

Ive lost enough over the last 2 years as shorting was only a small thing I considered....stupid me.

My holdings now are:

GOOG (ugh)
GE ( for now)
BBI (speculative and almost a wipeout)
FSLR (my wife's attempt to own a stock)
CSCO (ugh)
cash

I dont mind holding to tech stocks as theyre different sectors within it BUT more importantly I was more worried about balance sheets and cash on hand more than anything else when I bought them.

[Flasch186]

Originally Posted by lighthousekeeper

You mentioned this before, but where else can I get advice without spending any money (i.e. financial advisor, which I won't do unless they can provide a money-backed guarantee that they can outperform this messageboard) or time (i.e. researching on my own).

websites that specialize in this stuff.

Fool.com is just one.


OHHHHH but one thing I forgot to mention that that is supllemental to the assumption that you already know how to read their balance sheets and releases. That's first and foremost.

[SportsDino]

I suggest if you cannot do the research that you should certainly not be involved in direct stock plays. You are not entitled to some magical 12% because you are an American. And diversity is not some mystical security blanket either, like they were preaching before EVERY stock went down.

If you feel there is going to be a recovery in general, buy an index of the group of companies you expect to recover. If you can trust a manager, buy their fund, but I've found many are either incompetent or have conflicted interests (and yes there are some good ones too, but you need to research them like hawks).

If you are interested in doing your own research, one trick I like is to break everything down to cash. If you can truly understand how cash flows into a company and how it flows out, then you understand at least one fundamental aspect of how that company works. It will lead you into investigating other important fundamental aspects, such as revenue and potential growth in sales, funding from equity versus debt, whether you will actually get a dividend and the likelyhood of it being cut/grown, and so on. It may sound easy, but this is actually very hard today with the sparse information and all the ways companies can mess with it to hide things. For instance, what some companies were boasting of a few years ago in reality turned out to be massive blocks of money tied up into leveraged derivatives... trying to understand their bragging about profitability became the basis of my initial monster shorts (granted I've been pissed off since I was but a wee kid in 1997 seeing outrageous noise in the news and trying to puzzle it out ever since).

Cash flow will also help to understand how companies will whether the current storm of credit crisis or whatever you want to call it. For instance, both Ford and GM have been beaten to hell and gone lately, but one is less than 10% of its year peak and the other is less than 25% of its year peak. One had already gone through the bad credit wringer and had done some house cleaning, the other had not, match em up! (Or short both the MFers just to be safe!)

[sterlingice]

Originally Posted by SportsDino

I still advise against taking the advice of anyone on this board, especially me! However, you will have a hard time finding a portfolio that is not red at the moment. Also I've noticed a slight bias in my own news mongering that companies that are not acting like its the end of the world and are retaining jobs/growth options (or potentially preparing for expansion), are often getting punished by the market.

Right now when things are dirt cheap is when you want companies buying up assets and other companies... I always laughed at the fools thinking they are doing a great job with mergers during the good times at companies bought for their peak value... its easy to look good when everyone is drinking the same kool-aid, but real business and growth often happens in the rough red, not in the gaudy green.

That's one thing I'm a little happy about the company I work for. They've been cutting to the bone for the last 2 years so they have yet to really let anyone go (well, aside from 30K from a merger last year that they were already doing). Our CEO has said he thinks the workforce is about the right size (in CEO speak that means we're already understaffed) to emerge from a recession strong.

SI

[Flasch186]

Originally Posted by SportsDino

For instance, what some companies were boasting of a few years ago in reality turned out to be massive blocks of money tied up into leveraged derivatives... trying to understand their bragging about profitability became the basis of my initial monster shorts (granted I've been pissed off since I was but a wee kid in 1997 seeing outrageous noise in the news and trying to puzzle it out ever since).

Criminal in a lot of cases since some levels of assets ( a very large block most recently) couldnt even BE VALUED!!! So you could boil through report after report and still come up with bunk so had I been sitting across the table from you and you said, "Y'know Howard, honestly, I cant understand half this shit these companies are doing. Look, here, here and here...." I probably wouldve been all on board with your short but instead I figured...y'know, they've gotta be doing something right. I was wrong too, hence my theory of 'evaporating money' which is why I dont believe inflation is on the other side of this but that's a different debate where we both at least know where the other one is coming from.

[SportsDino]

To be fair, if everyone shorted the moment I started having reservations, they would have been wiped out from 1997 to 2001, if they started shorting when I knew something was wrong, they would have been destroyed from 2003 to 2006.

Same thing on a recovery, you can know that some parts of going to survive the mess with a pretty high probability, but you have to wait until the market momentum shifts before there will be a profit.

As for me, I'm just lucky I happened to start in 2007, and have always been a fan of the short (since I believe it is easier to predict panic than it is to predict growth). Only time will tell whether my notions of long plays will pan out (I wish I had the assets and the knowledge of a Warren Buffett in that regard, where I can outright buy and manage companies the way I think they would make money... hard working through indirect stocks more like gambling really).

[lighthousekeeper]

i'm telling you the stock market completely confounds me. aig posts $5,000,000,000 in losses for the quarter and their stock skyrockets. i really think the only people who should participate in the stock market are those with insider information, cuz it seems more rigged than boxing.

[Flasch186]

well my short position has been getting killed however I stand by the buy and the reasons behind it.

[sterlingice]

I work in IT as a contractor for a certain Bank. Perhaps it is one of America. As we were sitting there today, catching up on the news and how a certain Bank needs something like $35B, it's stock shot up like 10%. Huh?

EDIT: I know there's more to it than that. Particularly the "we won't let the banks fail" part and the "they've already received a crapload of bailout money and still have a bunch sitting around" part. But it's just stupid. It flies in the face of logic.

SI

[SportsDino]

There is a lot of psychology involved in this, basically people assuming things are going to improve and therefore buying up. You gotta realize that BAC for instance has dropped from $50 to $3 (in the time I've been watching it)... for it to jump from $3 to $15... you can get lost in the percent change numbers.

With the banks I think you have some people that think the government is going to restore them to their old price. Never mind if that price is completely out of whack with dividends , earnings, or debt.

AIG is a mess, I'm not even sure that loss counts the massive amounts of offsetting funding for the guvment. I don't mess with that stock at all these days, I'm assuming they are just treating it as financing and if you took it away the company would be bleeding out every orifice in red ink. I still theorize a decent amount of other company's profits are AIG's Fed money, and that eventually there will be another shell game where the AIG debt is offloaded onto some proxies and the government will let those dies. This is no different than the Enron scheme, except with government backing. But I'll hold my rants I guess and just profit off the bullshit (the government has infinite money after all, right! haha...heehaa... hoo... cry...).

[DaddyTorgo]

Originally Posted by sterlingice

I work in IT as a contractor for a certain Bank. Perhaps it is one of America. As we were sitting there today, catching up on the news and how a certain Bank needs something like $35B, it's stock shot up like 10%. Huh?

EDIT: I know there's more to it than that. Particularly the "we won't let the banks fail" part and the "they've already received a crapload of bailout money and still have a bunch sitting around" part. But it's just stupid. It flies in the face of logic.

SI

$35b really isn't that much all things considered. The expectation was that they would need to raise much more than that.

[CU Tiger]

Originally Posted by CU Tiger

Hell I'll play. And these are all plays I have personally invested in, so my money is where my mouth is so to speak. Dont take my advice or you will go broke.

1) Cummins (CMI) This is a play against QS pick of Caterpillar in a way. CAT recently announced a pull out of the on highway engine market leaving Cummins as the only independent engine manufacturer in the world for on highway applications meeting EPA standards. They are a traditionally liquid company and while a series of recent job cuts seem disastrous it appears they are staying ahead of the curve as opposed to chasing it.

Stock is trading at 24.52 today when as recently as August it was in the 70s. I look for a mid yer rebound and this stock to be in the 50s by year end.

2) Pepsico (PEP) Just a solid value play in my book. Their drink brands, snack food products and fast food business are near recession proof. Sure they are down like every stock but I look for huge returns for year end.

Trading today at 51.10 near a 52 week low I think this stock sees 75 before it sees 40.

3) Research in Motion (RIMM) Despite blackberry taking a beating to the Iphone and Googles latest greatest this stock continues to have ridiculous statistics. With Verizon now pushing the blackberry, as people begin to crunch home budgets I look for them to disconnect home phones and maybe even GASP give up home internet...why not if you can carry both with you?

Today its 45.10. While I dont see the quick run I see in my last 2 the dividend will help offset modest incremental gains. Still I see this stock pushing 60 by years end.

4) Bristol-Myers Squibb (BMY) Not even Obama will keep folks from getting sick. And this is the BEST drug company on the market, another recession proof industry.

Trading today at 22.20 I think this stock hovers on the high 20s maybe bumping 30 by years end.

5) General Electric (GE) With a company this diverse its almost like owning a mutual fund. Jack Welch may be moved on, and Jeff Immelt may have enemies in every corner, but this giant is just too big. I mean seriously when else can you simultaneously buy Aircraft engines and medical imaging equipment?

Its 14.10 today, I jumped in right at 13.00 in mid december. I plan to hold until ~16 and Ill take my profit then...if it drops Ill keep right on holding.

1 and 3 are doing very well....2,4,5 are just holding on..

[Marc Vaughan]

Of mine -

SOLR - GT Solar International, Inc
This has performed ludicrously well on little news or practical reasoning. I'm expecting earnings to be good, but having the stock over double since I posted it seems a tad optimistic even considering its beaten down state at that point.

SOLR continues to be a company which has remained profitable despite the turbulence and is well run - there are legs in this one yet, but don't be surprised if it pulls back a bit at some point first imho.

FVE - Five Star Quality Care, Inc.
The easing of the credit markets has apparently given confidence to the market that FVE will live to fight another day. Its doubled in price since I posted it, but imho still has some way to go until it reaches a sensible price level presuming it can continue to refinance debt sensibly.

NOK - Nokia and MSFT - Microsoft
Both have recovered somewhat along with the rest of the market (probably 20-30% gain) but are out of vogue at present as the money rushes back into the financial system.

I full expect both to recover another 20-30% by christmas, Microsoft especially have a bright year ahead imho with the new version of Windows actually looking like it'll be reasonably warmly recieved by people.

HYGS - Hydrogenics Corporation (USA)
Up about 30% from when I posted and making all the right noises (ie. new sales of buses in Europe etc.) - but still far too small a scale operation to get vastly excited about at present.

I AM concerned for the market in America for HYGS however as some spokespeople in the American goverment have apparently decided that Hydrogen isn't the 'future' for fuel in America (no indication has however been given as to what exactly they think the future will be).

[fantom1979]

I just hooked up with this company ran by some guy named Madoff.. This guy is a flipping genius. Every year I am getting 12% returns like clockwork. I don't know how he does it, I highly recommend it.

[Raiders Army]

Throwing this out there to see what happens in a year:

Human Genome Sciences Inc.: Increased by over 1,000% last year and I think they'll only go higher this year if BENLYSTA is approved.

Bionovo Inc.: Great penny stock and I think they have a chance of being a 1,000% stock this year.

[Marc Vaughan]

Of mine ...

SOLR - 5.40, 5.79 presently has rocked up and down between 4.8 and 7 since I picked it.
FVE - $1.85, $3.70, definitely the pick of the bunch for me - down from its peak of 4.12 but still a nice double.
NOK - $13 - $13.35, surprised it hasn't recovered more to be honest.
MSFT- $19 - $30.95, no brainer as when I picked it windows 7 was on its way.
HYGS - 0.44c - 41c presently, has kicked about between 40c and 65c since I picked it, I still stand by it.

Basically seeing as we started these picks in the depths of the trough it'd have been kinda hard to pick losers unless your company went bust imho, but still it makes us look good

[dervack]

I bought one share of arm holdings (armh) and it's up almost 19% since i bought it. And it's rumored that they might be designing the processor for the "iTablet"

[QuikSand]

Originally Posted by QuikSand

Here's a quick stab at things. Not getting on top of the mountain and predicting what's going to happen with everything... just picking a few stocks, that's all.

- - - - -

Caterpillar (CAT)

Not exactly a “stimulus package” play (I think any reasonable effect of a stim program is already built into prices, sadly), but rather a pretty standard cyclical play. With the economy and real estate both massive depressed, this construction-related blue chip is trading at embarrassingly low ratios – right now its P/E ratio is around 7, that’s just silly (earnings may dent that short term, admittedly). This company is **not** going out of business. The dividend is not a firm one from year to year – but at today’s rates, that itself is around a 4% yield at today’s prices of around $40. Highway robbery for what sits right now as a great value stock.

Forecast: eventually the world starts building shit again, and we need big rigs to move dirt around. CAT makes them. Stock goes to $56 or better in two years, and the dividend is pretty secure.


Hecla Mining (HL)

In the wake of a commodities meltdown, I think there’s real value in a number of related stocks. Precious metals took a massive thumping last year (full disclosure: I suffered) and mining stocks seemed to take a double whammy from not only a loss in the commodity price, but also a sell-of effect just by virtue of being equities. Where does that leave a silver and copper mining company like Hecla? Looking at a $11/oz price for silver, and wondering what the hell happened to them? This is a well run company where I’m already very long, but I see the current price in the $2.20-2.40 range being a complete steal. The gold/silver price ratio is too high, that usually means that silver is heading upwards… but even if silver stays at $11-12 an ounce for the next two years, Hecla should be at $3.50 rather than $2.25.

Forecast: ups and downs in the short run (profitable themselves if you move on both) but this thing has a bounce-back in the next 18 months, and should end 2009 over $3.00, possibly over $4.00.


Cedar Fair (FUN)

My bias is strong here, as I grew up practically in the shadows of their flagship amusement park and worked summers there. But the company has a lot going for it – among the operators of regional amusement parks, they are the one who obviously “gets it” and offers the best mix of entertainment, rides, food, and (underrated) appearance/cleanliness.

This is also a dividend play, almost completely. A share of FUN pays a quarterly dividend of 48 cents – that means you’re getting nearly two bucks a share back in dividends, at a share price right now of only $13. **IF** that remains intact, this is a monstrous yield, completely unsustainable.
There’s a real risk here. The company (a limited partnership) recently bought out Paramount Parks, and did so mostly with leveraged debt, so their books look bad. Their long time CEO is resigning (or just has), and he has been really good. So, it’s possible that this company simply loses its way, slashes its dividend, and the stock price drops to six bucks.

Why like it? Because I like their market position (and I think I understand it). In concept, sure, they lose out when a midwestern family says they can’t afford two hundred bucks for a weekend at Cedar Point this summer due to tight times. But they also make out well when a similar family says they can’t afford twelve hundred for a trip to Disneyland, and so they opt instead to go to a nearby regional attraction like Cedar Point . It’s like Wal-Mart, in a way – neither the top nor the bottom of the ladder, and that’s not too bad in these times.

I also know the driving mentality of this stock… they are a darling of "income investors" and realize that the dividend is essentially sacrosanct. It may not be the smartest move in toto, but I think they want to protect that dividend as best they can for fear of massive investor backlash.

Forecast: 2/3 chance that the company retains its dividends, has a solid 2009, and finishes 2010 with a stock price in the low 20s… 1/3 chance that they are in fairly serious trouble, drop the dividend, and the stock price is halved to 7 by then


Woodward Governor (WGOV)

This NASDAQ listing is somewhere amidst the seas of growth plays, energy plays, and technical plays. I think it has a decent case on each front. They make energy-related equipment, including nearly universal parts for aircraft – a pretty down industry right now. In time, that should promote a cyclical rebound.

However, the area for growth is that their transmission technologies are well suited for… windmills. If you buy the general notion that we have momentum toward renewable energy sources (I do, in part) then this seems like a fruitful area.

On the technical side, the stock is selling at a pretty modest P?E of 13. That’s not criminally low, but if you think this stock has any growth potential, it’s still pretty attractive. The stock price has really been punished of late, and while getting in at around $21 (today’s price) might not be the actual bottom, signs point to this stock heading upwards before long.

Forecast: Immediate future partially tied to oil/gas prices (when they are down, the fervor for alternative energy is lessened) but in the next several years this is a growth company with several reasons to like it – I think it hits $30 by the end of 2010, and has more potential past that, likely back to $40 or better within five years.


Cynosure (CYNO)

A bit of a goofy play here, but I am enamored for two reasons. First, I am becoming an old fart, increasingly out of touch with the young crowd, and thus I just love their company niche – tattoo removal technology.

From a technical standpoint, I also love that they have a ton of cash on their books – fairly odd for a somewhat new company. Even if all that happens is that they get bought out by someone big (and that’s not unthinkable given their balance sheet), that’s still a solid win for a shareholder.

No dividend, no history, nothing to say “solid” but this is an interesting spec play that has a chance to work out really well. Stock price right now is around eight bucks (after a mini-bump the last couple of weeks) and where it goes from here is anyone’s guess.

Forecast: Flip a coin. It could finish 2009 at $6 or $16. Or $36, I suppose. Might need to make that a 20-sided die after all, this thing could land just about anywhere.

Quick recap:

Caterpillar (CAT)
1/13/09 price = 41.40
1/04/10 price = 58.55

Fairly easy play in retrospect, unless you thought we had a long way down still to go in the recessionary drop. I actually bought at about 36 and again (as it ticked upward) at about 38, and am still in.

Hecla Mining (HL)
1/13/09 price = 2.32
1/04/10 price = 6.47

My biggest regret at this point was the shares I sold off as it ticked up top 3 and 4 dollars on the way to, and past, my "target" price. I'm out now for year-end purposes, but it was a good one this year.

Cedar Fair (FUN)
1/13/09 price = 13.62
1/04/10 price = 11.37

A real roller coaster ride... shaky year, never picked things up during the market boom, announced a shaky forecast for the aforementioned dividend in early Nov and fell off a cliff to under 7. I rode it out, and recently a private equity firm moved to buy it out at 11.50. I rang the register a couple of weeks ago, and am now out.

Woodward Governor (WGOV)
1/13/09 price = 21.69
1/04/10 price = 26.47

Basically a miss, in this environment. I did better with other more conventional energy plays - I still like this company, but I fear its niche might be too clever by half, and its stock price isn't a big value. I'm out.

Cynosure (CYNO)
1/13/09 price = 8.42
1/04/10 price = 11.57

Nice hit. I think it's basically just an adjustment, as the balance sheet of the company was too strong for the stock price that low... I'm still in, but don't have a forecast going forward, really.


S&P
1/13/09 price = 871.79
1/04/10 price = 1132.99
Growth: 30.0%

Quik5
Growth: 52.6%

I'll take that every time.

[CU Tiger]

1) CMI 24.52 -> 46.94
2) PEP 51.10 -> 61.24
3) RIMM 45.10 -> 65.93
4) BMY 22.2 -> 25.63
5) GE 14.10 -> 15.45


As Marc said, hard to miss when you pick in the depths of a slough.
Cummins and Research in Motion have donee well and I continue to hold those very strong, I am planning to take a bit of profit off in the coming weeks though.

Bristol-Meyers and GE have really disappointed me though, although have earned steady gains.

[SportsDino]

I've only mentioned playing WMT, FUN, and CAT here, but review of most of the babble I made in 2009:

- WMT: struggling to break 50 most of the time, around 54 now but due for another small dip. I still think it climbs towards 55 eventually, but probably will continue to go from 49-53 for most of the year. This is one I like to spike because I'm reasonably confident it is solid to predict (I like lots of cash and scale and no real panic signs).

- FUN: ugh... this stock is ruined by a changeover in leadership. I was hoping it would not be as much of a factor, but it has been... I liquidated at 11 in late July, picked it at 7 in November on pure dividend fascination, and dumped it again after the latest hooplah over 11 (never turn down a 50% gain with a company that is giving you heartburn). I'm at the point where I am giving up on it... one of those companies where its core is great but top office shenanigans are going to sink it possibly.

- CAT: covered by Quiksand, I was reluctant in January, but loaded up during the great buy fest of March. Haven't even spiked it, just holding on... it has more than doubled though and it has flattened so I think I might just take some profits and risk missing further growth (maybe a bad idea to hope for a downtick reload here though). I rather have the cash at the moment since this is my favorite time of year (so many fiscal years coming to a close, data tends to shake up the markets and I like to gamble).

- XOM: I think I targeted it at 72, and I've sold it whenever it gets over that point (nudging here and there based on the news). I was actually out of it for most of the 4th quarter (except a tiny long term share I keep of a bunch of stocks). My load in point was at 68 for last year, I'm nuding it up to 70 for this year. Not sure where I will put my out price at yet, depends a bit on...

- DIG: Proshares Oil and Gas, I wasn't sure how to model this, all I knew is it would trend up. I actually missed the big June/July dip for the most part, but was still positive overall from March, so held tight. I'm not too disappointed, it is almost double overall for the year. I don't see oil/gas declining significantly... not sure how much more upside remains though so I'm not increasing my load.

- BP: Worked out better than XOM, flew past my target and never looked back. I did use my DIG info to time myself out of the stack during June/July (I wasn't sure about overall oil/gas but I love my predictor based plays). So I tapped out once during the year, so my first climb was about 35-36 to 51, and my second climb was about 46 to today's 59. I'll take those gains over a few months for what I considered a pretty predictable play.


Have to second whoever said it was easy to pick winners from March onward though....

[SportsDino]

Dola, even more stocks I blathered about in various threads:

- JPM: My pick for a big winner of the financial piranha storm. More than doubled from my load up point. Course you could have went with....

- BAC: I was right to doubt them declining too much further from early January of last year (although they did drop 50% if you had optimal timing so maybe not so smart on my part). I was slow to join their uptick party, but they have doubled from early April. If you got them on my favorite day in March they would have quadrupled by end of the year. I still don't like them for a number of reasons, but they did put up gangbuster numbers. But its all RELATIVE... I shorted them in 2007 at greater than $45... and they are only up to $16 now... you fall hard of course you can bounce hard... IF YOU BOUNCE. Still stand by it being a risky grab up and right to be cautious, but what I'm terming the AIG shell game made it obvious they'd bounce for the rest of the year so I tagged along.

- C: I still won't touch Citigroup... relatively they are still hammered even far worst than BAC. Sure they bounced like everyone else, but say you moved in April your annual return would suck now, although if you were smart you could have doubled round August-October.

- AIG: I'm not sure this is even a company anymore. Play with at your own risk, if you are an insider maybe you can make a fortune. The stock even split this last year... you could write a text book if you can fully understand this company... I do not.

Oh and I still dabble in gold (IAU usually) mostly because I'm an inflation paranoid person, and even though gold is pretty worthless the mob doesn't seem to think so! I tend to get in and out of it unpredictably, basically I buy gold when I have some chunk of dollars I don't have other plans for (as opposed to moving it into some form of treasuries for that week/month). Because of this randomness (timing based on other moves, not on particular gold related information for the most part) I got a lot of red and green, but the positive trend and odd November/December behavior led to a nice unexpected bonus.


All in all, a much easier year than 2008 for investing, but i think 2010 will be more difficult to figure out because there is no real clear direction to me where it should go. I was hoping for employment numbers that have not come so I think we'll see some shockwaves related to that. The form of that is important though, if there is investor optimism despite real economic weakness the stocks could stay level or grow slightly. And I'm afraid of shorting in general because if the employment powder keg does explode for the better it might make the current 'leveling off' pattern trade in for a small boom that could eat up a lot of money in a hurry (investor enthusiasm/depression tends to outpace the real economy after all).

Maybe we should start a thread for guesstimating 2010?

[lynchjm24]

I picked up a few thousand shares of BAC in the low double digits. I did grab some Citibank at 3.25. I've been writing covered calls on the BAC and doing well with it thus far. Citibank is just a 10k gamble that maybe some day turns into 100k.

[SportsDino]

I'll admit, Citigroup is one that is bargain priced, but it is for a reason (they had a mess with enough doubt about how it is cleaning up to keep it depressed).

Granted I am curious about what conditions could cause a massive spike in its price so it may indeed quadruple (I'd think a price of $30 is unlikely in the short term, and I stopped looking beyond a couple years a long time ago).

So ya, I'll probably move in eventually, but I come out ahead on average by waiting until I have something bonafide before I move. I'm simultaneously too aggressive and too cautious!!!

[Raiders Army]

Originally Posted by Raiders Army

Throwing this out there to see what happens in a year:

Human Genome Sciences Inc.: Increased by over 1,000% last year and I think they'll only go higher this year if BENLYSTA is approved.

Bionovo Inc.: Great penny stock and I think they have a chance of being a 1,000% stock this year.

I also picked up some GenVen today.

I got HGSI at $30.90, BNVI at $0.51, and GNVC at $1.49. I think the BioTech stocks will do well this year. Just a feeling.

[lynchjm24]

Originally Posted by SportsDino

I'll admit, Citigroup is one that is bargain priced, but it is for a reason (they had a mess with enough doubt about how it is cleaning up to keep it depressed).

Granted I am curious about what conditions could cause a massive spike in its price so it may indeed quadruple (I'd think a price of $30 is unlikely in the short term, and I stopped looking beyond a couple years a long time ago).

So ya, I'll probably move in eventually, but I come out ahead on average by waiting until I have something bonafide before I move. I'm simultaneously too aggressive and too cautious!!!

I had Ford that I picked up when it was at it's nadir. I pussied out and sold it in the 5's.

Pretty much every chance you would have taken on depressed prices have paid off handsomly. Someday that Citi is going to come back and when it does I'm going to be sitting on it. If I'm wrong so be it, I was stupid not to buy BAC at $3 because I was scared because my wife was pregnant. I might be early, but I'd rather be too early then too late.

[SportsDino]

I can respect that.

Well, let me try to explain a bit of what is going through my head on Citigroup to show why you should probably ignore me!

Basically I had limited pile of money and that meant only so many plays.

I also am a big preacher of 'INFORMATION, INFO, INPUT for Johnny 5! MORE INPUT!'... my research said there would be overall positive news for my chosen bank (JPM). So I moved on that in March with my other long plays.

I then eval the other big banks which took me until April. BAC was at 7, C was at 3.... I thought BAC was shady but would look good (overal positive news) and that C was shady and would have red flag news items.

So for me it was where did I reasonably target it hitting, and I was interested in a year play (some volatility profit-mongering but I didn't want to miss out on uptick with too much gaming, so yes I held tight for the most part).

Since I have a limited pool, I pick BAC (and other banks) and I avoid C, simply because for my strategy I wanted ones that would bounce sooner rather than later. This somewhat panned out, BAC doubled, and C is up about a quarter (overall, lets ignore optimal timing in hindsight, just a straight up hold from my decision point to now).

Now of course I'm re-evaluating. At this point JPM and BAC have recovered a good chunk, whereas C's stock is still low compared to historical level, and more importantly, low compared to its scale. So as you identified, it basically has the potential to boom.

If you are certain it will boom, and you are long term, you should buy.

My game introduces a timing variable, and despite my hyperactivity I'm a risk sensitive brat (I'm nervous about the sheer amount of crud on Citi's books, granted all banks have it...). I'm not certain it will boom (although I'd put a high % on it) and more importantly I'm not sure it will boom soon as opposed to an alternative bet I could make that would give me some happy cash now at higher probability.

Presumably if I then can predict when C will boom (say the info changes and the signs point towards an investor crowd being more certain of it) I would presumably have more money to lay on the C bet, and I'm basically hoping it is at the same rough price (as in, my interim bets grow at a faster rate than C's price does before my move).

All of this assumes I can time the market, which of course is a fool's game, but I've been lucky or smart so far.

So all this to say, your strategy is probably going to work. And I no doubt will be in there with you at some point, you might end up making more than me though because you bought now (you will certainly make more on C by itself, my assumption is growth from other bets in addition to the eventual C bet outpaces a single C bet now).

[lynchjm24]

You are thinking much harder about it then I am. Every stock has hit a ridiculous low and has comeback. The only stock that is still at a ridiculous low is Citibank. I'm not certain it will boom, but almost everything else has so why not just make the easy play and see where it leaves me in 2-3 years.

It's just a 10k lottery ticket. I've made more then that on BAC since Monday. I'll take the chance that Citi goes up 500% in 2-3 years over the few thousand dollars I could potentially grind out elsewhere.