PR(i)M and Proper

I have mentioned in my blog numerous times that a signal that the value stocks which make up MFI will do well, is when M&A activity heats up. Because who gets bought at a premium? Value stocks. That is often the catalyst.

I have also often harped on these pages of mine, that MFI dividend stocks, for whatever reason, have outperformed the broader basket of MFI stocks since I started tracking in 2006. That has been less true of late, but the winds seem to be changing.

The latest M&A "hit" was on Monday with PRM (Primedia Sold To PE Firm For $525 Million). That represents a 60% premium to where they were trading. That in turn made my dividend portfolios jump up as PRM was in Jan, Feb and September:

Date	Stock	Initial Price	End Price	Percent Change
2/25/2011	USMO	14.93	15.46	4%
2/25/2011	RLRN	10.71	10.41	-3%
2/25/2011	RTN	50.81	49.07	-3%
2/25/2011	PETS	14.72	12.72	-14%
2/25/2011	PRM	4.44	7.02	58%
2/25/2011	PDLI	4.74	6.39	35%
2/25/2011	LO	77.19	111.67	45%
2/25/2011	DLX	25.32	26.89	6%
2/25/2011	CHKE	17.00	19.05	12%
2/25/2011	HRB	15.02	15.87	6%
Date	Stock	Initial Price	End Price	Percent Change
1/3/2011	UNTD	6.53	5.97	-9%
1/3/2011	USMO	18.05	15.46	-14%
1/3/2011	PRM	4.07	7.02	72%
1/3/2011	PDLI	6.20	6.39	3%
1/3/2011	LO	80.55	111.67	39%
1/3/2011	ELNK	8.59	7.82	-9%
1/3/2011	DLX	23.42	26.89	15%
1/3/2011	CHKE	18.97	19.05	0%
1/3/2011	HRB	12.36	15.87	28%
Date	Stock	Initial Price	End Price	Percent Change
9/24/2010	UNTD	5.53	5.97	8%
9/24/2010	USMO	14.69	15.46	5%
9/24/2010	RTN	44.75	49.07	10%
9/24/2010	PRM	3.41	7.02	106%
9/24/2010	PDLI	5.01	6.39	28%
9/24/2010	LO	78.97	111.67	41%
9/24/2010	ELNK	8.85	7.82	-12%
9/24/2010	DLX	18.44	26.89	46%
9/24/2010	HRB	12.78	15.87	24%

Seth Klarman

Repeat after me, "if Seth Klarman likes a Magic Formula Stock buy it!". For those who do not know, Seth Klarman is one of the best value investors out there, often seeing value where others do not.

In the past quarter he increased his holdings in PDLI by 87% at an average price of $5.38. It is now $6.43, plus I am sure he has a dividend... so a nice 20%+ gain. I had bought them at about $5.10, but sold on fear of items in their 10k.

This quarter, he has also been a big buyer of AVEO, picking it up at around $14.21. It is now over $19, a nifty 34% gain for him in the quarter. I have placed it on my watch list, in the event it pulls back.

Dell Reports Solid Earnings

DELL reported their earnings after the bell, and they were quite satisfactory... nice for a change after being bloodied by Cisco. They made 55 cents a share, which seems pretty good for a $16 stock. This quarter replaces a so-so quarter from last year, so I suspect we'll be seeing Dell jump on some of the MFI lists.

In happy hour trading, they are up about 6%. That makes me up about 14%, so I am happy.

People seemed pretty split on Dell. Fast Money says it is time to take profits, while Cramer actually was bullish. I will hold as I think they are a good news story.

New Energy Spikes Up

When you have fallen a long ways, it doesn't take much for out-sized percentage gains. NEWN actually dropped at the end of last week to $2.68 on news that their earnings was being postponed a week. Well in the next two days, NEWN went from $2,68 to $3.34. I don't have mu calculator around, but that as to be pushing 25% in two days. I think there is still some hope for a recovery in this stock for me. Now if NEP would get going as well...

Go Mavericks!