A Look Back Almost a Year Ago

My February 1st 2013 MFI tranche has about 15 trading days left.  It is up by 93.6%:

2/1/13 Stocks	Start	Current	Dividend	Pct Gain	R3K Gain
AAPL	$450.60	$540.04	$8.75	21.8%	24.4%
GA	$6.10	$11.00	$0.65	91.0%	24.4%
STRZA	$16.06	$30.00	$0.00	86.8%	24.4%
CA	$25.07	$33.45	$1.00	37.4%	24.4%
NUS	$41.94	$137.68	$1.20	231.1%	24.4%
Totals				93.6%	24.4%

I felt it might be instructive (since this is a Diary after all) to go back and read what I wrote when I bought these five stocks (MFI Diary: The Ultimate Bear Signal).

Here are my thoughts on February 1st:

So now that my apology is over, let me tell my 20 regular readers my five new MFI stocks.  There is a surprise or two.  Let us go alphabetical:

1. AAPL - I know they are already in my second tranche.  But I have only committed to trying to pick the five best stocks each quarter, never said I would not double up.  I got 'em at $450.60.  I do not think I need to get on the soap box, read Sh(aapl)led from last week.
2. CA - this is Computer Associates.  I have thought about buying them about 100 times. They meet my dividend requirement as they pay a snappy 4% dividend. They have a fortress balance sheet and their earnings have been very stable.  Recall my discussion a couple days ago about how I thought 2013 would be the year pent-up M&A demand starts up?  CA is a perfect company for some one to snap up.
3. GA - Not sure if people know Giant Interactive.  If you go back and look at my top 200 list, you'll see they are top 10.  First the "negative" news.  They are based in China. I know, I have taken my lumps there.  But they are a cash-generating machine, kind of the ultimate "Jake's Bubble Gum Shop" from Greenblatt's book.  I can tell they are "real" as they are a billion $ company and have paid out tons of "real" dividends.  They have a core group of online games, so kind of like Electronic Arts or Take Two, except they are 100% on the web.
4. NUS - this is a MLM (dirty word since the HLF power point came out), but therein lies the opportunity as they have sold off of late.  They have a decent 1.8% dividend (GA is around 5%, varies by year).
5. STRZA - this is a spin-off (which can often unlock great value) from Liberty Media.  They are the STARZ franchise; like HBO.

Now, there was actually some wisdom in there.  AAPL was a good buy at $450.  This was the first time I had bought a MFI stock in two tranches, and I think that is a good strategy as I am buying stocks that I understand.  That is a theme that has been successfully continued.

CA never got a nibble to be bought, but as a 4% yielder and continued solid earnings they rose with the rising tide.

GA was and is the cash generating machine I mentioned.  They have instituted a dividend and have a buyout offer at 11.75.

NUS was a great example of buying when others are fearful.  MLMs where still out-of-favor and that did turn out to be a great opportunity, plus NUS came out with some products that have been extraordinarily successful.

STRZA was a great example of unlocking value with a spin-off.  Classic buy via JG's first book.  They are also putting out their own content and initial opinions are favorable.  They are still (remarkably) on the MFI lists.  It is tempting to hold them for another year as they still seem to have very good potential and are certainly an acquisition target.

Today was a very solid day, up a notch more than 1%.  I am now in the green for the year... woo-hoo!