January 31, 2014
Comment on Model Portfolio activity
Markets have been under pressure this week and we have
recommitted funds in issues that we sold higher- Symantec, CTXS, Athena
(Justice, Lane Bryant), and added two new issues in Proctor&Gamble and
International Game technology. We also added GM B warrants.
With a nice cash position we are willing to cautiously
commit to issues we feel offer appreciation potential. Further correction is
needed to create a base for a sustained move higher.
*****
January 24, 2014
Comment on Model Portfolio activity
Stocks
are in a correction mode as last year’s winners lock in profits and this year’s
money waits on the sidelines. We sold a few more issues for profits and one
loss (Sony) and repurchased American Eagle $2.50 lower than we sold it a week
ago as the CEO suddenly quit. Old management took over on an interim basis.
Insiders own 17% of the shares so we are willing to give old management the nod
since they are much more involved in AEO’s success than we.
We
repurchased Alcoa higher than we sold last week when a JP Morgan analyst raised
estimates and issued a buy on the stock. We have been trading Alcoa with flat
success for the past few years as it trended lower. The oversupply of aluminum
has been a bugaboo to earnings. The current wisdom suggests that the supply
condition may be tightening. AA has room to run on the upside. Our recent sale
last week was too cute but we don’t want ego to prevent the longer term
potential to be squandered.
Alcoa (AA_) jumped early in Tuesday's session
after receiving an upgrade from JPMorgan. The investment firm upgraded the
stock to "overweight" from "neutral" and raised its price
target to $15 to reflect tightening aluminum markets and rising regional
aluminum premiums on earnings.
"Given
the pace and amount at which premiums have recently increased, it is clearly
difficult to forecast for how long they will remain near current levels which
we believe provide a significant amount of earnings support to the company's
primary aluminum smelting operations," wrote JPMorgan analyst Michael F.
Gambardella in the report.
The firm
increased its 2014 earnings estimates to 78 cents a share from 40 cents a share
and fiscal 2015 earnings to 68 cents a share from 55 cents a share. Analysts
surveyed by Thomson Reuters anticipate net income of 32 cents a share in fiscal
2014 and 58 cents a share in fiscal 2015.
The
world's third-largest aluminum producer enjoyed a strong surge in share prices
last week, after announcing it would close two potlines at its Massena East
plant in New York state on the grounds they were not competitive anymore. The
company also said it plans to expand its Davenport, Iowa factory, a plant
dedicated to supplying aluminum to car and truck producers.
On
Friday, the Pittsburgh-based business announced its board had approved a
quarterly dividend of 3 cents a share payable Feb. 25 to common stock
shareholders of record at the close of Feb. 7. On its cumulative preferred
stock priced at $3.75 a share, the company will offer a
quarterly dividend of 93.75 cents a share on April 1 to shareholders of record
at the close of March 14.
http://www.thestreet.com/story/12253685/1/what-has-alcoa-aa-jumping-on-tuesday.html?puc=yahoo&cm_ven=YAHOO
*****
January 17, 2014
Comment on Model Portfolio activity
We raised more cash this week
taking profits as earnings season continues. Bad news or even neutral news was
greeted with more negative action than above expectations news was followed by
positive action.
With the S&P 500 up 50% in
the last two years without any serious correction we would be pushing our luck
and our experience to remain as fully invested as we were at year end in our
successful attempt to participate in the yearend rally.
The world is not going to end
but with so many bulls caution seems warranted.
*****
January 10, 2014
Comment on Model Portfolio activity
We raised cash in the New Year from some issues that gave us
the year end pop. We also sold Abercrombie for a profit when it jumped 12% on
news of better that expected lower earnings. And we decided to eliminate
J C Penney. We don’t want the soap opera to affect this year’s returns.
January 3, 2014
Happy New Year. Our first post in the New Year will be on
Friday January 10 as we are taking a week to visit clients.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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