Thursday, August 12, 2010

Looking a Little Bit Better (all the Time)

I have to say that my portfolio move on 6/29 has really really worked out. Back then, I was down inception to date 11% while the Russell 3000 was down 15%. Now, about a month and a half latter I am down 5.7% and the Russell 3000 is down 14.5%. Even worse, I would be below the 11% mark as the stocks I sold are down since then 5.5% and the stocks I kept are up 1%. Recall that I sold about 65% of my portfolio. You may ask, "how have you moved from down 11% to down 5.7%?". The answer is that I have bought back in some and the stocks I have bought back into have had some spectacular moves

CCME +23%
UTA +26%
CEL +11%
CMFO +18%
BORN +10%

I have essentially gone with the barbell strategy, a group of "safer" stocks with good dividends (PM, CEL, CHKE, VALU, UNTD, RAI and TTT) and a group of riskier stocks such as CSKI, CEU, CCME, CMFO, BORN, NEWN, UTA and KSW. Then my other stocks are FLL, IPXL and CF. Still 30% in cash.

NEWN reports on Monday morning, I have had very good earnings so far on this group. I will bang the table on CCME, which is only not on the MFI list as they show earnings by 6 month intervals rather than quarterly. Here are some key points:
  • They have already stated they expect to make over $80m this year.
  • The second quarter has been pre-announced around 25-27m.
  • Note that annualizes much higher than $80.
  • They have good earnings visibility as they have many long term (5 year) contracts.
They are audited by Deloitte (so people who bash questionable financials can't say anything). Starr International (owned mainly by Hank Greenberg, formerly of AIG and who is intimately knowledge of all things China) invested a chunk of money.

Finally, their market cap is 382m and they have 114m of cash with no debt.

Consider the table pounded.