Sunday, August 16, 2015

Home Sweet Home

Home Sweet Home

Good to be back home. Had a great vacation, am recharged and ready to get back up and at 'em.  I did gain about 5 pounds as we ate out a lot. So job one will be to lose a little weight.Also, lost my iPad during the trip. Little disappointed in human nature. It was in a leather portfolio with my business card. But no calls or emails.  Hmm, just went through Spam to make double sure - nada.  So I guess I'll be buying a new toy.  I think i may just get a better computer as this one is four years old.

Newest Tranche

As I mentioned the other day, I have just kicked off my August 2015 tranche.  I was very tempted to just keep the same five stocks:

8/15/2014 Start Current Dividend Pct Gain R3K Gain
CSCO $24.40 $28.95 $0.80 21.9% 8.8%
AGX $36.71 $40.69 $0.70 12.7% 8.8%
ITRN $21.32 $25.11 $0.87 21.9% 8.8%
BRCD $9.34 $10.15 $0.15 10.3% 8.8%
CBI $58.25 $51.70 $0.21 -10.9% 8.8%
Totals 11.2% 8.8%

  • CSCO is on Goldman's conviction buy list and I am excited in the energy a new CEO will bring in.
  • AGX still seems very cheap by many metrics.  Recall that I actually bought two years ago at the extremely cheap price of $15.60!  That goes down as a great trade. But I was worried that they are dependent on a couple large projects.
  • ITRN was a quietly solid stock that no one has heard of. They are not on the list any more (though they are in my top 200). I will sell on Monday, though they are so lightly traded that I will need to be thoughtful about my trade.
  • BRCD seems cheapish to me.  They were 20% higher just a month or two ago. They announce earnings next week and I am considering holding through those earnings, but will likely sell tomorrow.
  • CBI - this is just a cheap stock. I suspect I'll regret selling them. I do own in one of my other tranches.  I will keep on my radar and may re-buy later. They are tied somewhat to the energy industry - but they have a solid backlog of projects.
So CSCO was the only one I kept.  It is the true blue chip in the group. CBI and BRCD were close runner ups.

8/17/2015 Start Current Dividend Pct Gain R3K Gain
VDSI $18.66 $18.86 $0.00 1.1% 0.0%
SALE $9.34 $9.36 $0.00 0.2% 0.0%
CSCO $28.95 $29.03 $0.00 0.3% 0.0%
TGNA $25.30 $25.44 $0.00 0.6% 0.0%
HSII $20.14 $20.15 $0.00 0.0% 0.0%
Totals 0.4% 0.0%

Here is my new tranche.  I think I was a bit excited by some new names on the list.

  • VDSI is actually a data security company.  Recall I did own AVG for a pretty long stretch. They were in my May 2014 and ended up 19%. Since I sold them, they're up another 5.5%.  They have a solid balance sheet. They're growing 18% this year. Next year they have guided lower which caused them to sell off from over $30 to under $19.
  • SALE - this was a much bally-hooed IPO a couple years ago, kind of like Groupon. They had very disappointing earnings this quarter and have gone (ahem) on "sale", dropping from north of $20 to under $10.  Theyhave a great balance sheet ($5.22 of cash per share for a $9.35 stock). They are making money.  The issue is that they are no longer in growth mode. But that seems priced in to me.
  • TGNA - I was surprised to see that Carl Icahn is a huge owner of this stock.  He bought at much higher price, they've fallen from $37 to $25 in past quarter.  They operate TV stations.  Maybe a bit of a slower growth business with the internet growing, but I expect consolidation to occur here. And political advertising is potential catalyst over next year.
  • HSII - this is a stock I have owned before. Back in October 2007, which was a bad time to buy an employment company stock as we had the 2008-09 recession. They are like KFY, who I owned in my August 2012 tranche and they are essentially a bet that employment growth continues.  They do pay decent dividend (2.6%).

Stocks that I considered include AGX, BRCD, CBI, KORS, MNDO, BSQR, BKE, VIAB, LCI and PERI.  I will take these ten stocks (as I always do) and create a "reject" portfolio so I can kick myself if I made wrong choices.

Last Year's Rejects

As a benchmark, my five picks went up 11.2%.  My reject portfolio was only up 3%. It was really hurt by VIAB being down 46%. ACN was the big winner, up 32%.  If I had just carried over my 5 picks from August 2013, I would have been down 4% - so that was a near miss as well. It was really hurt by FLR (down 34%) and KLIC (down 28%).  KLIC by the way, is looking very cheap to me at $10.25.

Have a great day everyone.

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