Taking Stock of My Stocks - Part 2

Stock of My Stocks

I am sitting here Christmas Eve, in front of a crackling fire sipping on a Dark & Stormy.  Thought I would craft a start on part deux of my current stock holdings.  Not sure if people find this interesting at all, but it is actually helpful to me. So thanks for your patience



To recap, here are my current holdings:

Index	Stock	Shares
1	AAPL	187
2	CSCO	4,292
3	JPM	1,673
4	GNW	10,000
5	glre	2,500
6	CSQ	5,444
7	SDS	1,000
8	SAI	4,680
9	HFC	1,117
10	KMF	1,845
11	VIVHY	2,296
12	MSFT	1,640
13	PGR	2,092
14	PRE	536
15	PVD	427
16	INTC	1,974
17	JQC	4,192
18	SD	6,000
19	FCX	1,100
20	MPC	582
21	BHK	2,240
22	SLCA	2,060
23	FSC	2,802
24	OIBAX	3,925
25	STO	1,040
26	NSU	5,524
27	KFY	1,436
28	O	556
29	ABC	500
30	VIAB	405
31	WU	1,570
32	LPS	840
33	DLB	580
34	uis	1,001

VIVHY - this is Vivendi, a French conglomerate. This has been another very good buy for me,  up 44% since I bought them They yield about 5.7%, but just pay the dividend annually.  Vivendi owns a bunch of items including a telecom, Universal Music, Activision, a Brazilian Telecom... (you get the picture).  The point with Vivendi, is that the sum of the parts is greater than what they sell for.  If they signal they are willing to look at "strategic" options, the stock could move up sharply.  Interestingly, they were profiled in Barron's over the weekend as one of their picks in their "Buy Europe" article (Europe on Sale).

MSFT - huge company, huge disappointment so far. By pretty much any measure, they are quite cheap. They have a 14% earnings yield, a very high return on capital.  They pay a 3.1% dividend. They are priced with the expectation of continued movement away from standard PCs and that the Surface and Windows 8 mobile will not gain traction.  I have checked out the Surface and some of the new ultrabooks and I think they can be competitive with Tablets. All the reviews I have seen of the new Nokia Lumina phone are very positive. Time will tell if Microsoft has any growth left or whether it has become like a utility.

PGR - who doesn't know this company?  Flo is right up there with Barrack Obama in recognition here in the US. I like Progressive because they are very (ahem) progressive. One of the smartest insurance companies out there.  I love their new snapshot tool that once again will leap them ahead of the competition.  Compared to most insurers they are a bit pricey, but you are paying for best of breed.

PRE - Partner Re for many years traded at a premium amongst reinsurers. But they fell on hard times in 2010 and 2011 as their CEO retired and they had out-sized losses in several events, such as the New Zealand quakes and the Japan quake/tsunami. In addition, the merger with Paris Re was not super-successful.  That being said, they became extremely cheap at the end of 2011. I bought them for that reason, plus I felt that mammoth reinsurers Swiss Re and Munich Re would perhaps become a bit impaired as they had so much sovereign debt (European) on their balance sheets.  I was wrong on that count as they have prospered, but I bought PRE with such a large margin of safety, I have done well.  My chart shows I bought them at $67.23 and have a 23% gain. But I also bought my largest tranche in September of 2011 at the fire sale price of $56.26, which I sold a year later for a 46% profit (for tax reasons). I still think they are a buy with a great balance sheet, an improving reinsurance market, price under book value and a compelling dividend.

PVD - this is a unique stock that I have followed for many years via Vivian Lewis (Global Investing Newsletter).  They manage pension funds in Chile. They pay a very nice dividend ($8.40 this year and $6.50 in 2011).  I bought them as they became dirt cheap in the fall of 201. I did pick up shares on September 26th at $57.00. That savvy purchase is now up almost 90%.  I do have trouble telling if they are fairly valued. But they are unique, one of their peers was sold this summer at a valuation that would imply about $120 is a fair price.  They are owned in part by the Spanish bank, BBVA. So a full sale is always possible given the troubles in Spain and need to raise capital.  In the meantime, I am content with the 9% yield based on 2012 dividends.

INTC - I suppose I could cut and paste what I wrote on MSFT. Since I bought them a couple of years ago, I am up a whopping 3%. The question for the market is whether they have become a 4% yielding utility, or whether there is still growth in them thar hills. They are such a smart, efficient and well-run company, that I would be surprised if they are out of the mobile game indefinitely.  They have also developed a wonderful device that can be charged without being plugged in (Wireless charging could hit next year, says Intel)! They are cheap by pretty much any metric. I have them at a 16% earning yield.  I will continue to be patient.  Any signs of growth and INTC moves quickly towards $30.

JQC - this is another of my closed end bargains.  When I bought them last year, they were at about a 10% discount to their NAV.  Now they trade at about a 1% discount.  They did actually (like CSQ) sell off very sharply post-election and sold at a 13% discount briefly, as shown in the chart on the right (I should have been paying more attention!).  They pay a monthly dividend that yields 8% annually.  They are a hybrid of stocks and bonds. I started buying them too early (July of 2011) and my 1st tranche is only up 19%.  My best tranche was bought in October of 2011 and it is up about 40%.  it is so critical to get good entry points on your investments.  That is why I am sitting with a lot of cash right now.  I expect some better entry points down the road in February.

SD - this is one of my most recent buys.  They are an under-valued energy company that has too much debt on their balance sheet.  However, they do have some under-valued assets and as they sell those (and if the price of natural gas rises) they should appreciate. Prem Watsa bought a 10% stake at about $5.27 a share.  I followed him at $5.53, which I bought on Nov 28th.  I sold those shares 10 days later as the stock price has gone up almost 30% to $7.13.  I have since then re-bought my shares at $6.49.  Now I wait.  This stock is neither in my dividend portfolio or my MFI portfolio.

FCX - this is another very recent buy in my dividend portfolio.  Freeport is a large Gold and Copper miner that pays a nice dividend.  I owned them earlier in the year and sold them for a 15% gain in October at $41.  I then re-bought the same number of shares on December 5th at $32.17 after they announced their purchases of Plains Exploration and McMoran Exploration, making FCX no longer a pure mining play.

MPC - this the refinery spin-off from Marathon Oil a year or so ago. very similar to my play on Holly Frontier (HFC) that was in my top 10.  They have steadily been increasing their dividend and are in a great position in the macro environment.  They are up an awesome 44% since I bought them in February.  Despite that run-up, Barron's listed them as one of 10 best stocks for 2013 (Reviewing Barron's Top 10 for 2013).

Front of our Home Christmas Morning

Ok, enough for now.  beautiful White Christmas in Connecticut.  I will finish my write-up later.  The majority of remaining stocks are MFI stocks.