Sold out of Anadarko at a small profit. Chart could go either way, and I found myself waiting for the weekly oil supply numbers. Everybody and their mother is in on that game, with a lot more money... so I'll leave before I get hurt. Ironically, I doubled down on Consol Energy. The downward moves have been painful, but the 200-day average is providing good support, as it's done in the past. Now that I'm here, it could very well change. We'll see. I also picked up some Viacom Class A (voting) shares. I'm having trouble with it's valuation, but when you've got MTV, VH1, Nickelodeon and Paramount... that's not by accident. These are some brands that get very heavy rotation at my house. Without Cruise they have the capacity to get younger and reconnect with their target demographics.
P.S. After hours, I see Anadarko struck some more oil with BP in the deep Gulf and sales of generic Plavix have been ordered to stop. I was on the right track but got impatient and jittery. I really have to stop doing that. Solid historical equity growth is not an artifact, but a testament to a company's management, there proven past, and their ability to position themselves to take advantage of future opportunities. I say this as a general observation and not specifically about Anadarko and Sanofi/Bristol-Myers. Forethought can do wonders for "luck". In 1759 or so, Arthur Guiness signed a 9000 year lease for his St James Gate location at a cost of 45 pounds a year. Brilliant.
Thursday, August 31, 2006
Friday, August 25, 2006
Wow! It's been two weeks...
I'll get this off my chest: I'm watching Cramer's 'Atonement' show for the umpteenth time tonight. I remember watching that show where he told the world to buy Dick's the night before earnings! Pretty bold... awfully wrong. It makes me remember every time anybody ever called him about Anheuser-Busch and he told them off, with gusto! Especially since the price was down towards $40. Now, I have no record of this except my own mind, and my wife can tell you how bad my memory is, but I did tell my wife (when I thought she might have actually been interested in my knowledge of stocks), my father-in-law, my father, and my sister: SOMEBODY DOESN'T LIKE BUD TRADING AT $40. Three times. Now, of course, I didn't have enough capital to do some damage, nor did I have the risk tolerance, but I liked that, and "the Brain" didn't... what's the point? BUD heads north of $45 and all of a sudden, he's telling everyone how he owns BUD for his charitable trust. Beer, butts, soap and grub. That's all we hear nowadays. I had a lot of respect for him pumping oil so much, but those BUD rants lost him some points with me. The lesson is, you have to think independent. The 'talking heads' are valuable for at least one thing: using you and me to bounce ideas off of. I've found Cramer to be no different; just a bit more entertaining. And unfortunately, I believe his Mad Money persona has gotten the upper hand on his Real Money humility. Oh well.
Onward and upward. A lot happened since I last talked to you. First, LOW is down near $26 since I sold it for a small profit up near $29.50. Glad I did that. I sold my remaining shares in First Horizon for a small profit due to the overwhelming long term trend line resistance. Maybe I'll reload when it gets back in the mid 30s... as of last check, that plane has departed. I sold DuPont at a small loss because it was doing nothing for me, although it was bouncing up and down. Impatient, I told you; I shouldn't have bought it in the first place, or at least waited until it pierced $39.00. I sold Sanofi because it didn't have the action I thought it might. The looming judicial matters weighed more and more on my decision. I read that the generic Plavix DID have FDA approval... but again I had to ask, if that company was so right, why did THEY sign that $40m deal with Bristol Myers and Sanofi? Too much risk. See ya!
I took my DuPont money and my First Horizon money and bought 100 shares of Anadarko afterall. The wall street pimps are going to play the oil thing as long as they possibly can... how long exactly? I don't know, but oil was backing down from $75 towards $71 very cautiously and everyone was bailing, even with the BP-Alaska and Middle East situations still unfolding... so I pounced. I looked over the domestic independent oil companies' reserve data long and hard. I think M&A activity may pick up amongst the group, but the pickens are slim. Chesapeake has lots of gas. Whiting has some oil. Occidental has lots of oil, but not so much gas. Encana has quite a bit of both, both I thought a good amount was stuck in the sands. Anadarko had almost as much oil as Occidental (~75%) but a lot more gas. I ran over the acquisition presentation and then realized how big the Kerr McGee deal was in getting to those deepwater gulf fields. Anadarko was virtually non-existent in the area and now they own a big, solid piece of the pie. It's a lot of energy, it's in our neighborhood, and if someday, somebody wants to take it, they gotta go through us. The chart said it was oversold, it wasn't even keeping pace with the other oils... diworseification? I think it was more a food coma. But both deals are done now... and there's a hurricane in the carribean. I bought it at $45.50. Before I forget, both APC and CNX gave me ulcers one day this week, sinking hard. It hurt, but no pain, no gain. Besides, I had my hands tied by the rules of the game makers. Good thing.
I also had given some of my money to the folks at MWRK. I see another mini-baby boom going on at the beach, in the office, and among my friends. Even my wife and sister - my retail eyes - have commented how everybody's pregnant. All I remember is how my wife had to scour the ends of the earth to find a maternity dress for a wedding, and everytime we looked at dresses either online or in person, at any store, every item was from one brand - Motherhood. They supply Nordstom's, Sears, Macy's, Babies R Us, their own Pea in the Pod, Mimi Maternity, Motherhood Maternity and Destination Maternity stores, plus every boutique we went to in NYC. They have a stranglehold on the market, plus hardly anything is on sale and the full price stuff isn't cheap. Women need these clothes so we have to cough up the dough. Their cap is less than $200m, they're working out of debt... I saw the stock at $24 and hesitated. When I looked again, it was $36. I still think they have a LONG way to grow, so I followed Lynch's advice and put as much money in the stock as I did in the store. We'll see.
Lastly, I bought Target. I'll take another shot at a big retailer. I think the perception of the housing market is killing stocks like Lowe's, even thought the first place people put money in times like these are into their own homes in order to build value. Myself included. We'll see how Low it goes. As for the consumer staples that are on everybody's mind, Target is the much more pleasant place to make these purchase - my own opinion and per my retail scouts - so I don't think they'll suffer from a lack of business. I see no competition emerging from anywhere. Add a dividend - I have a longer term than 2 weeks for Target - and a bit more room to grow before it saturates the landscape. It's down from $60 to $46, looks oversold, and reminds me of Budweiser a year ago. This could be the bottom, or it may go to $40 - wouldn't that be ironic - but I thought the reward justified the risk. It actually sounds A LOT like Lowe's. Time will tell. I also decided to tap the CBH well for a second time. The first I rode it from 33.25 to 36. I reloaded at 33.26.
Until next time.
Since 7/7/06
Nasdaq -0.5%
My mutual funds -0.01%
DJIA +0.5%
S&P +1.5%
Neduardo +9.8%
Note to self: Stay disciplined.
Onward and upward. A lot happened since I last talked to you. First, LOW is down near $26 since I sold it for a small profit up near $29.50. Glad I did that. I sold my remaining shares in First Horizon for a small profit due to the overwhelming long term trend line resistance. Maybe I'll reload when it gets back in the mid 30s... as of last check, that plane has departed. I sold DuPont at a small loss because it was doing nothing for me, although it was bouncing up and down. Impatient, I told you; I shouldn't have bought it in the first place, or at least waited until it pierced $39.00. I sold Sanofi because it didn't have the action I thought it might. The looming judicial matters weighed more and more on my decision. I read that the generic Plavix DID have FDA approval... but again I had to ask, if that company was so right, why did THEY sign that $40m deal with Bristol Myers and Sanofi? Too much risk. See ya!
I took my DuPont money and my First Horizon money and bought 100 shares of Anadarko afterall. The wall street pimps are going to play the oil thing as long as they possibly can... how long exactly? I don't know, but oil was backing down from $75 towards $71 very cautiously and everyone was bailing, even with the BP-Alaska and Middle East situations still unfolding... so I pounced. I looked over the domestic independent oil companies' reserve data long and hard. I think M&A activity may pick up amongst the group, but the pickens are slim. Chesapeake has lots of gas. Whiting has some oil. Occidental has lots of oil, but not so much gas. Encana has quite a bit of both, both I thought a good amount was stuck in the sands. Anadarko had almost as much oil as Occidental (~75%) but a lot more gas. I ran over the acquisition presentation and then realized how big the Kerr McGee deal was in getting to those deepwater gulf fields. Anadarko was virtually non-existent in the area and now they own a big, solid piece of the pie. It's a lot of energy, it's in our neighborhood, and if someday, somebody wants to take it, they gotta go through us. The chart said it was oversold, it wasn't even keeping pace with the other oils... diworseification? I think it was more a food coma. But both deals are done now... and there's a hurricane in the carribean. I bought it at $45.50. Before I forget, both APC and CNX gave me ulcers one day this week, sinking hard. It hurt, but no pain, no gain. Besides, I had my hands tied by the rules of the game makers. Good thing.
I also had given some of my money to the folks at MWRK. I see another mini-baby boom going on at the beach, in the office, and among my friends. Even my wife and sister - my retail eyes - have commented how everybody's pregnant. All I remember is how my wife had to scour the ends of the earth to find a maternity dress for a wedding, and everytime we looked at dresses either online or in person, at any store, every item was from one brand - Motherhood. They supply Nordstom's, Sears, Macy's, Babies R Us, their own Pea in the Pod, Mimi Maternity, Motherhood Maternity and Destination Maternity stores, plus every boutique we went to in NYC. They have a stranglehold on the market, plus hardly anything is on sale and the full price stuff isn't cheap. Women need these clothes so we have to cough up the dough. Their cap is less than $200m, they're working out of debt... I saw the stock at $24 and hesitated. When I looked again, it was $36. I still think they have a LONG way to grow, so I followed Lynch's advice and put as much money in the stock as I did in the store. We'll see.
Lastly, I bought Target. I'll take another shot at a big retailer. I think the perception of the housing market is killing stocks like Lowe's, even thought the first place people put money in times like these are into their own homes in order to build value. Myself included. We'll see how Low it goes. As for the consumer staples that are on everybody's mind, Target is the much more pleasant place to make these purchase - my own opinion and per my retail scouts - so I don't think they'll suffer from a lack of business. I see no competition emerging from anywhere. Add a dividend - I have a longer term than 2 weeks for Target - and a bit more room to grow before it saturates the landscape. It's down from $60 to $46, looks oversold, and reminds me of Budweiser a year ago. This could be the bottom, or it may go to $40 - wouldn't that be ironic - but I thought the reward justified the risk. It actually sounds A LOT like Lowe's. Time will tell. I also decided to tap the CBH well for a second time. The first I rode it from 33.25 to 36. I reloaded at 33.26.
Until next time.
Since 7/7/06
Nasdaq -0.5%
My mutual funds -0.01%
DJIA +0.5%
S&P +1.5%
Neduardo +9.8%
Note to self: Stay disciplined.
Friday, August 18, 2006
Friday Musings
I watched as UPS went over $72, but now I see it below where I sold it. Not as big a profit as I COULD have had, but better than a sharp stick in the eye. Took that money and bought Consol Energy (CNX) at 38.09. Considered Anadarko, but it's not moving with the other oil companies - quite possibly due to a pending Lynchian "diworseification". CNX has coal and natural gas exposure as people were fleeing energy. Plus, it had the oversold MACD, slow stochasctics, and RSI...
Watching SNY today. I'm up the tiniest of bits on my position - better than, well you know... Here's the dilemna: As far as I know, you need FDA approval to sell generics (in the US at least), which that Canadian company does not have (again, to my knowledge). But if they're so in the wrong, why did BMY/SNY try to bribe them? Preservation of capital or wait for the ruling. Now I'm not watching support lines and equity supply/demand imbalances, but a judge. And it's not Mike Judge. News coverage and a kneejerk reaction, as I alluded to in my first entry.
I let go of Lowe's, too. Impatient again. Hit resistance at about 29.75 and fell back for the third time. I'll see how I played it Come Monday when earnings are released. Saw it going to the mid-30s. Oh well.
Did buy some Sirius Satellite March '07 $3 calls. Trading just above good support... for the next 7 months, I have back to school, the holidays, Howard Stern, AND Mel Karmazin working for me. We'll see.
Watching SNY today. I'm up the tiniest of bits on my position - better than, well you know... Here's the dilemna: As far as I know, you need FDA approval to sell generics (in the US at least), which that Canadian company does not have (again, to my knowledge). But if they're so in the wrong, why did BMY/SNY try to bribe them? Preservation of capital or wait for the ruling. Now I'm not watching support lines and equity supply/demand imbalances, but a judge. And it's not Mike Judge. News coverage and a kneejerk reaction, as I alluded to in my first entry.
I let go of Lowe's, too. Impatient again. Hit resistance at about 29.75 and fell back for the third time. I'll see how I played it Come Monday when earnings are released. Saw it going to the mid-30s. Oh well.
Did buy some Sirius Satellite March '07 $3 calls. Trading just above good support... for the next 7 months, I have back to school, the holidays, Howard Stern, AND Mel Karmazin working for me. We'll see.
Wednesday, August 16, 2006
Monday, August 14, 2006
I really couldn't wait to see how this post would come out with the graphs and all, sooo...
Here's a 10-yr Lowe's weekly dot chart. Oversold right to the 200-week EMA, as it's done before. Will it be any different this time? With my luck?? Quite possibly, but I thought the Rolling EPS line might ease my nerves. I like the dots because the outliers stand out so much more... like a connect-the-dots that's got a big fat mistake.
Next up is DuPont. Quite choppy and near the bottom. A mistake? Maybe, in the fact I'll have to wait a bit longer to recoup my money. I like Yum Brands' action too, but the bottom support got broken and I'm waiting for it to define it's new range. Not the cyclical, like DuPont... plus, I can never find a KFC/Taco Bell when I want one. In my view, they have great growth potential before they saturate the dreamscape. At least DuPont has a big fat dividend yield as I wait.
Le Sanofi-Aventis. Oui. A big pipeline, nice uptrends, a clearly defined channel (not shown), add in some volatility...
And last but not least, UPS. Retesting it's long-term trend line (also not shown) and, as I read on another blog today, "oversold to a level never before seen". They also pointed out what happened every time after UPS was oversold (it went back up)... except once (there note, not mine), when it kept going down for several months. My note: it went down for several months, until it finally hit that aforementioned trend line!
Here's a 10-yr Lowe's weekly dot chart. Oversold right to the 200-week EMA, as it's done before. Will it be any different this time? With my luck?? Quite possibly, but I thought the Rolling EPS line might ease my nerves. I like the dots because the outliers stand out so much more... like a connect-the-dots that's got a big fat mistake.
Next up is DuPont. Quite choppy and near the bottom. A mistake? Maybe, in the fact I'll have to wait a bit longer to recoup my money. I like Yum Brands' action too, but the bottom support got broken and I'm waiting for it to define it's new range. Not the cyclical, like DuPont... plus, I can never find a KFC/Taco Bell when I want one. In my view, they have great growth potential before they saturate the dreamscape. At least DuPont has a big fat dividend yield as I wait.
Le Sanofi-Aventis. Oui. A big pipeline, nice uptrends, a clearly defined channel (not shown), add in some volatility...
And last but not least, UPS. Retesting it's long-term trend line (also not shown) and, as I read on another blog today, "oversold to a level never before seen". They also pointed out what happened every time after UPS was oversold (it went back up)... except once (there note, not mine), when it kept going down for several months. My note: it went down for several months, until it finally hit that aforementioned trend line!
Friday, August 11, 2006
Are you Ed Phlanders? Good...
I've decided to take another, more serious attempt at blogging. Trying to analyze stock charts has really grown on me since my previous blogging life, when I was pretty much just bored at work. After having been laid off I had six weeks of 'vacation' where I would usually get up in the morning, feed my daughter, put a video on for her... and waste about three hours analyzing charts (in between shooting out resumes in search of a new job). I landed a temp job that lasted about seven weeks before finally getting a permanent offer. During that time I decided to roll over my 401(k). I fretted over mutual funds and high yield stocks for weeks while waiting for the distribution check to arrive. I read Cramer's 'Real Money' and a couple of Peter Lynch books. I rifled through copies of Money, Kiplinger's, and SmartMoney whenever I got the chance - even while driving - trying to keep a mental note of the recurring themes.
Originally I'd gotten pretty lucky and cashed out some stock options from my previous employer. Going public was pretty exciting for our small company - if you had asked aloud what we were currently trading at, you'd get an answer from someone nearby. Once we got favorable news, the stock took off overnight. Within a year or so it had lost 80% of it's maximum value. Today I think it's down 90% from those highs. I sold off shares all the way up... and all the way down. I think I actually even sold some within $3 of the top. "It'll go higher... it just has to!" eventually led to "It'll turn around... it's just correcting itself a little bit... OK, a LOT!" Finally, the price spiked one afternoon - right up against the downward trend line - and I squeezed what I could out my last options before they expired. The point is I was able to put some of those proceeds into a brokerage account. And so the lessons began.
I won't go into the gory details, but quite a few other people ended up with my money. I'd read a quote by someone saying that the money on Wall St flows from the impatient to the patient. I was impatient. So I learned a lot about bad timing. I bought high and sold low. Duped every single time! I continued to watch the stocks for a while after I dumped them. I had the right idea, but just bad timing. I try to remember the ones that got away, as learning experiences. Arch Coal and Frontier Oil. Both breaking out and on a tear. I got on board... and got weak in the knees when they retested support. Both eventually exceeded what I saw as target prices. Same with Nvidia. Those are the biggest foul ups I can remember at the moment. I've also tried way too hard to find obscure microcaps that might grow into small- and mid-caps. Impatient again. Maybe they will, just not in my lifetime, I hope. I've studied too many charts looking for telltale technical signs of a move. Impossible. The biggest reason I believe is the blanket news coverage and the ensuing kneejerk overreactions. My favorite was Elan stock losing 90% of its value because a couple of patients died while taking Tysabri. There was no direct cause-and-effect established for these rare but unfortunate events, so I bought some near the lows, made a little bit of quick money and moved along when I got bored.
I've learned a lot from my father-in-law, too. High-yield financials and utilities are his game. And he's got a mean game. He also took Lynch's "buy what you know" to heart... and that's also worked real well. He's reinforced Cramer's motto "It's better than a sharp stick in the eye" upon me. Nevermind the ability to bounce ideas off each other whenever we have a couple of cocktails at a family function. On a recent family vacation, I asked him why I would want to buy Marriott at these prices. I mean they do have a great business going on and all... "because you want a piece of their profits!" Last but not least, I have to give Jim Cramer his fair shake. When I first started getting serious about learning all this stuff, the daily commute home would never be complete without his radio show. And he started telling people to buy oil a LONG time ago, before anybody else was pounding the table on it. Naturally, I think he's had to make some stretches to fill his daily airing schedule, but I'm starting to understand why he likes certain stocks and not others - I think. Especially the larger caps. At least he's entertaining.
Anyway, I've started to develop an appreciation for trendlines, support, and resistance. And I'm starting to understand the rationale for charts having MACD as a default indicator... I just wish the slow stochastics and relative strength were defaults, too, to save time. Oh well, I'll have to look at the volume sooner or later, anyway. More to the point, I've tried to develop an understanding of how demand drives volume, and volume drives prices. I guess I had to mature a bit, get out into the real world, since failing basic economics classes in both high school AND college! I've always had a knack for math though...
Anyway, now that you know my secrets, here's the deal. I bought my own high-yield stocks for my account right before they both jumped up more than 10% in a week. High-yield stocks don't do this! It was better than a sharp stick in the eye, so I took my profits so I could get back in at cheaper prices and with more money. Noticing it might take them a while to go back down to the lower support, I looked for more stocks that were already there... and wating for their turn to turn back up... established companies with good brands bouncing around their price ranges, using the overbought/oversold indicators to help me get in and out with the greatest risk/reward payoffs. I'll admit right up front that this experiment is VERY new and it's been a tough week this last one. My goal is to accumulate money. My ultimate goal is to retire to a boat parked in Nantucket harbor so I can sit back with a cold drink, take a deep breath, and watch the world go by.
Shorting stocks isn't in my cards. I'm long LOW @ 28.65, DD @ 40, SNY @ 44.5, and UPS @ 66.25. I'll get into my reasoning and macro outlook another time. Why the economy isn't slowing down, per se... efficiency. Inventory. I may publish my charts, but for now I've got to get to bed.
Originally I'd gotten pretty lucky and cashed out some stock options from my previous employer. Going public was pretty exciting for our small company - if you had asked aloud what we were currently trading at, you'd get an answer from someone nearby. Once we got favorable news, the stock took off overnight. Within a year or so it had lost 80% of it's maximum value. Today I think it's down 90% from those highs. I sold off shares all the way up... and all the way down. I think I actually even sold some within $3 of the top. "It'll go higher... it just has to!" eventually led to "It'll turn around... it's just correcting itself a little bit... OK, a LOT!" Finally, the price spiked one afternoon - right up against the downward trend line - and I squeezed what I could out my last options before they expired. The point is I was able to put some of those proceeds into a brokerage account. And so the lessons began.
I won't go into the gory details, but quite a few other people ended up with my money. I'd read a quote by someone saying that the money on Wall St flows from the impatient to the patient. I was impatient. So I learned a lot about bad timing. I bought high and sold low. Duped every single time! I continued to watch the stocks for a while after I dumped them. I had the right idea, but just bad timing. I try to remember the ones that got away, as learning experiences. Arch Coal and Frontier Oil. Both breaking out and on a tear. I got on board... and got weak in the knees when they retested support. Both eventually exceeded what I saw as target prices. Same with Nvidia. Those are the biggest foul ups I can remember at the moment. I've also tried way too hard to find obscure microcaps that might grow into small- and mid-caps. Impatient again. Maybe they will, just not in my lifetime, I hope. I've studied too many charts looking for telltale technical signs of a move. Impossible. The biggest reason I believe is the blanket news coverage and the ensuing kneejerk overreactions. My favorite was Elan stock losing 90% of its value because a couple of patients died while taking Tysabri. There was no direct cause-and-effect established for these rare but unfortunate events, so I bought some near the lows, made a little bit of quick money and moved along when I got bored.
I've learned a lot from my father-in-law, too. High-yield financials and utilities are his game. And he's got a mean game. He also took Lynch's "buy what you know" to heart... and that's also worked real well. He's reinforced Cramer's motto "It's better than a sharp stick in the eye" upon me. Nevermind the ability to bounce ideas off each other whenever we have a couple of cocktails at a family function. On a recent family vacation, I asked him why I would want to buy Marriott at these prices. I mean they do have a great business going on and all... "because you want a piece of their profits!" Last but not least, I have to give Jim Cramer his fair shake. When I first started getting serious about learning all this stuff, the daily commute home would never be complete without his radio show. And he started telling people to buy oil a LONG time ago, before anybody else was pounding the table on it. Naturally, I think he's had to make some stretches to fill his daily airing schedule, but I'm starting to understand why he likes certain stocks and not others - I think. Especially the larger caps. At least he's entertaining.
Anyway, I've started to develop an appreciation for trendlines, support, and resistance. And I'm starting to understand the rationale for charts having MACD as a default indicator... I just wish the slow stochastics and relative strength were defaults, too, to save time. Oh well, I'll have to look at the volume sooner or later, anyway. More to the point, I've tried to develop an understanding of how demand drives volume, and volume drives prices. I guess I had to mature a bit, get out into the real world, since failing basic economics classes in both high school AND college! I've always had a knack for math though...
Anyway, now that you know my secrets, here's the deal. I bought my own high-yield stocks for my account right before they both jumped up more than 10% in a week. High-yield stocks don't do this! It was better than a sharp stick in the eye, so I took my profits so I could get back in at cheaper prices and with more money. Noticing it might take them a while to go back down to the lower support, I looked for more stocks that were already there... and wating for their turn to turn back up... established companies with good brands bouncing around their price ranges, using the overbought/oversold indicators to help me get in and out with the greatest risk/reward payoffs. I'll admit right up front that this experiment is VERY new and it's been a tough week this last one. My goal is to accumulate money. My ultimate goal is to retire to a boat parked in Nantucket harbor so I can sit back with a cold drink, take a deep breath, and watch the world go by.
Shorting stocks isn't in my cards. I'm long LOW @ 28.65, DD @ 40, SNY @ 44.5, and UPS @ 66.25. I'll get into my reasoning and macro outlook another time. Why the economy isn't slowing down, per se... efficiency. Inventory. I may publish my charts, but for now I've got to get to bed.
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